September 28, 1978
Page 32155
Mr. MUSKIE. Mr. President, I understand that Senator BROOKE will be on the floor shortly, so I would like to reserve my amendment until that time. I have some further comments on the bill to make before that time. The distinguished ranking Republican member of the Budget Committee (Mr. BELLMON) is here with some comments of his own. So, pending time for Senator BROOKE to arrive and to get into the issue raised by the provisions of the bill which is identified with his name, I will proceed with my general comments.
Mr. President, the Senate now has before it S. 2441, the Federal Public Transportation Act of 1978. This is a major multi-year, mass transit authorization bill, and I am certain the Senate will want to know the implications of its enactment on the congressional budget ceilings. Before I get into that subject in detail, however, I want to say that I support most of the provisions of the bill.
The major exception is section 104 (c), which would establish an expensive new policy regarding Federal mass transit operating subsidies. That particular provision stands out so clearly as a "budget buster," that I believe the Senate has no alternative but to eliminate it from the reported bill.
I commend Senator WILLIAMS, the manager of the bill, for his skill in defining the transit problems that we have in our urban areas, and for his many contributions to solving those problems with Federal assistance.
I can recall when he began those efforts years ago, when I, myself, was a member of the then Senate Banking Committee. I remember what a struggle it was for him to get a start in establishing Federal policy dealing with mass transit. I have watched his efforts over the years and I want to take this opportunity to commend him for those efforts.
Although I have serious concerns regarding certain aspects of the bill, as I just mentioned, I want to say that I believe my colleague from New Jersey has made another substantial contribution to mass transit by shaping this major authorization legislation now before us.
Mr. President, I should like to take a few minutes to report to the Senate on the potential impact of this bill on the Federal budgets for fiscal year 1979 and future years.
To begin with, S. 2441 provides specific UMTA authorizations of $14.8 billion over a 4-year period beginning in fiscal year 1979, plus indefinite authorizations for interstate transfers — that is, transfers from the highway program — which are expected to require a further $2.7 billion over the same period. Annual program authorizations total approximately $4.0 billion in fiscal year 1979, and increase steadily thereafter to $4.6 billion in fiscal year 1982.
As chairman of the Budget Committee, I regret to say that these authorization levels could cause serious budgetary problems. The spending ceilings agreed to by the Congress in the second budget resolution allow for a substantial but responsible 16 percent increase in mass transit program levels. This increase substantially exceeds the overall 11.1 percent increase in the budget for fiscal year 1979 and reflects the priority that the Congress attaches to mass transit programs. But, full funding of S. 2441 would produce an immediate 32 percent increase in program levels and cause the budget ceilings in function 400, transportation, to be exceeded by $0.4 billion in budget authority and $0.3 billion in outlays in fiscal year 1979 alone. Further, full funding would cause the 5 year transportation targets to be breached by at least $2.5 billion in budget authority and $2.2 billion in outlays.
Fortunately, Mr. President, unlike existing mass transit legislation, S. 2441 does not provide "backdoor" spending which automatically provides full funding. Rather, in accordance with the requirements of the Budget Act, it provides only authorizations for appropriations. This should result in a significant improvement in the Congress' ability to control mass transit spending.
This new control may already be in evidence in the form of the recently approved fiscal year 1979 Department of Transportation Appropriations Act that provides mass transit funding which is consistent with congressional spending ceilings and much lower than would be authorized by S. 2441 or companion House legislation. However, I must caution that the regular appropriations bill does not include funds for several programs and projects which would be authorized by S. 2441 and could be funded with supplemental appropriations.
Mr. President, I have reviewed the list of possible transportation supplementals very carefully, and I believe that if there is no unwarranted expansion of established Federal policy toward mass transit; then we can expect the Appropriations Committee to assure that the Congress stays within its fiscal 1979 transportation spending ceilings.
The important question, then — and I am now approaching the question of my amendment — is whether S. 2441 includes any provisions which would fundamentally alter Federal mass transit spending policy, and in so doing jeopardize the Appropriations Committee's ability to hold spending within the congressional budget ceilings.
Unfortunately, there is one such policy change in S. 2441 as reported, and I believe its budgetary implications are so unfavorable that the Senate must remove that provision from the bill. I refer, Mr. President, to section 104(c) , which would establish a new and expensive policy regarding Federal assistance for the financing of mass transit operating deficits.
AMENDMENT NO. 3458
The amendment I call up at this time would strike this section from the bill. I am joined in this amendment by my distinguished colleagues (Senator PROXMIRE) the chairman of the Banking Committee which reported S. 2441; Senator BAYH, chairman of the Transportation Subcommittee of the Appropriations Committee; and Senator BELLMON, the ranking member of the Budget Committee. Also cosponsoring the amendment are Senators DOMENICI, LUGAR, and SASSER. Mr. President, I ask unanimous consent that Senators MCINTYRE, EAGLETON, BENTSEN, HATCH, MCCLURE, and THURMOND, be added as cosponsors of this amendment.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. MUSKIE. Mr. President, enactment of section 104(c) would redefine mass transit policy to provide Federal operating subsidies to all transit operators up to the point where the total amount of these subsidies is equal to one-half of each transit operator's operating deficit. The only limitation is one that is included in a separate section of the bill, and provides that the subsidies cannot equal more than one-third of the recipient's total operating expenses.
Under current policy, 50 percent of the transit operating deficit represents a ceiling above which Federal operating subsidies cannot rise. Section 104(c) would fundamentally change this policy, by converting the ceiling to a floor.
There is a song that was popular not long ago which suggests that there is no real difference between a ceiling and a floor, that it is all a matter of perspective. In the words of Paul Simon's song, "one man's ceiling is another man's floor." Well, Mr. President, in case any of my fellow Senators live in high-rise apartments where that message has a ring of truth, let me assure them that, at least as far as Federal spending is concerned, there is a very significant difference between a ceiling and a floor, as analysis of this provision makes very clear.
As reported, S. 2441 includes an authorization for section 104(c) that starts at $127 million in fiscal year 1979 and increases each year thereafter, reaching $318 million by fiscal year 1982. These authorization amounts are based upon the critical assumptions that transit deficits are under control and that the proposed new Federal policy will not influence transit operators, local transit unions and city officials to alter existing approaches to transit financing. However, those assumptions are totally unrealistic.
In fact, it is very likely that enactment of section 104(c) would have a very significant impact on future decisions related to transit fares and transit operating costs, and therefore also on the level of Federal operating subsidies required to implement the new policy.
Were the provision to be enacted, the perception would be that the Federal Government stands ready to pay for all increases in each transit operator's costs and deficit until the size of those payments reaches one-half of the operating deficit, or one-third of total operating costs. This 100 percent Federal share would provide a clear financial incentive for local transit operations to allow wages and other costs to rise and fares to fall — or fail to rise with continued increases in costs, until one of the two limiting conditions applicable to the size of Federal subsidies became operative.
For example, assume that a particular transit operation currently has annual operating costs of $200 million, operating revenues of $100 million and therefore an annual deficit of $100 million as well. Assume further that the local government is financing $75 million of the deficit and that the Federal Government is providing operating g subsidies of $25 million, equal to 25 percent of the deficit. Enactment of section 104(c) would establish the "proper" level of Federal subsidy at 50 percent of the deficit, or $50 million. Because of a "maintenance of effort" provision in the law, the local government could not reduce its subsidy of $75 million. Therefore, the only way in which the transit operation could receive the additional Federal subsidies to which it was now "entitled" would be for it to allow its deficit to rise. It could do this by any of several methods, including the tactic of simply acquiescing to high-cost wage settlements which add $50 million to operating costs. Total annual operating costs would then be $250 million. As before, operating revenues would be $100 million and the local subsidy $75 million. The Federal subsidy, however, would increase by $50 million, to $75 million, equal to one-half of the new deficit. The result, therefore, would be that the Federal Government paid for 100 percent of the increase in operating cost and in the deficit.
Theoretically, it would be possible to contain Federal subsidies by limiting the authorization and appropriation amounts. However, this would prove extremely difficult, if not impossible. Under section 104(c), transit operations which are not already eligible for assistance under the new policy would become eligible in the future as their costs and deficits rise. Since this ultimately would lead to transit operations in essentially all cities being eligible, the pressure on the Congress to provide additional funding would be extremely strong.
Enactment of section 104(c) thus could result in significantly greater additional Federal spending than the specific authorizations in S. 2441 suggest. For example, UMTA has estimated that the radical policy change could quickly result in additional costs of as much as $2 billion per year. The Congressional Budget Office, even though using a much more conservative method to project transit deficits, still estimates that the additional annual cost of this section alone would climb to over $1 billion by fiscal year 1983.
Mr. President, in terms of the level of Federal operating subsidies, CBO's estimate — which, again, is much more conservative than that of UMTA — shows that section 104(c) by itself could cause Federal operating subsidies to approximately double in 3 short years. In terms of the congressional budget, section 104(c) by itself could cause the fiscal year 1979 through fiscal year 1983 spending targets to be exceeded by nearly $4 billion.
Mr. President, given this situation I see but one possible conclusion: The section 104(c) provision in S. 2441 represents an unwise new direction for mass transit policy, the cost of which is seriously understated.
Others have recognized this to be the case. I note that the provision was extremely contentious in committee, where it was approved by only 1 vote, 8 to 7. No less than five members, including the chairman of the committee, filed dissenting views. It is also strenuously opposed by the administration and by the League of Cities and U.S. Conference of Mayors, all of which see very clearly the fiscal irresponsibility which the provision entails.
Mr. President, I would conclude by reminding the Senate of two points. First, section 104(c) is a problem not only because it would cause the Congress to break its own budget, but also because it represents very bad mass transit policy. If enacted, it would provide incentives for cities to mismanage their transit operations. Second, defeat of this provision will in no way shortchange the cities with regard to Federal operating subsidies. Even without section 104(c), S. 2441 still provides for an immediate increase in annual authorizations available for operating subsidies of about 48 percent or $400 million, most of which is earmarked for the same large cities that would benefit the most under section 104(c). No one can charge that the Senate is being stingy with mass transit.
I urge the Senate to vote "aye" on our amendment to strike this unwise and excessively costly policy provision from the Federal Public Transportation Act of 1978.
Mr. President, at this point, I am happy to yield to my good friend from Oklahoma, the ranking Republican on the Budget Committee (Mr. BELLMON), for such time as he may wish.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. BELLMON. Mr. President, I thank my friend, the Senator from Maine.
I strongly support the Muskie amendment, of which I am a cosponsor.
The distinguished Senator from Maine has made several important and telling points against the amendment, and much of what I want to say will simply reinforce the position he has taken.
The amendment would strike portions of section 104 from S. 2441. The problem, as I see it, is that the new policy, established by the amendment relating to mass transit operating subsidies established in section 104, sends all the wrong signals to local transit authorities. In essence, it encourages such transit systems to act in an irresponsible manner as regards the control of operating deficits because the bill provides full assurance that the Federal Government will pick up the check for any adverse financial results.
Heretofore, our policy with respect to Federal assistance to mass transit operations has been one which limited Federal exposure to no more than 50 percent of operating deficits. This new policy, envisioned in section 104, would provide additional operating subsidies of no less than one-third of total operating costs or 50 percent of operating deficits. Thus — and Senator MUSKIE made this point — what was formally a ceiling will now become a floor.
Transit systems would then have no reluctance to permit costs to rise or fares to remain static in the face of rising costs, since the Federal subsidy would increase, leaving them financially no worse off and politically better off than they were before.
In addition to establishing bad transit policy, the new provisions of section 104 are authorized at unrealistically low levels and therefore subvert future budgets. The authorization suggests that $1.3 billion would adequately fund the purposes of this section between now and 1982. CBO however, has estimated that, as local transit operators change their behavior and flock to the Federal feast, an additional $2.6 billion would be required, if the purpose of this section were to be realized.
It has been alleged that the appropriations process could be used to prevent such escalating costs. However, we all recognize that as virtually all transit systems became eligible for the subsidy, intense pressure to fatten up the subsidy would be put on the appropriations process. Certainly it is undesirable to create such a situation with full knowledge and seemingly by design.
Finally, Mr. President, I feel compelled to point out that initially two cities, Boston and New York, would receive over 50 percent of the incremental funding associated with section 104 operating subsidies. In the case of Boston we would be rewarding a transit system whose fares according to DOT are among the lowest (25 cents) and its employees among the highest paid in the Nation, over $8 an hour. In short, by "bailing out" the Boston transit system, we would be rewarding profligate behavior and encouraging others to adopt the same theory of operation which has created a crisis in that city. Should that come to pass, the extent of Federal commitments to mass transit subsidies become virtually limitless. Resources are scarce and Federal support must be limited and constrained in such a manner that its implementation improves rather than destroys local initiative and responsibility.
I encourage my colleagues to support this amendment, which reaffirms existing public policy and precludes the establishment of a new, expensive and undesirable alternative.
Mr. BENTSEN. Mr. President, I strongly support the Muskie amendment, and I congratulate the Senator from Maine for his diligence in trying to see that we have some legislation to help the taxpayers get some results for their money. I think we have to strike section 104(c) from the Federal Public Transportation Act.
My opposition to this provision stems not from any innate bias against mass transit. I have been a strong supporter of mass transit, as the Senator from Maine well knows from the 1974 fight, in which I helped him. I recognize the pressing need to improve these facilities and encourage their use.
In chairing the Transportation Committee, I held hearings in New York; in Watts, Los Angeles; in Chicago, and in Atlanta, involving the mass transportation systems, and I saw how effective they can be and saw how much waste can occur with poor management.
I do not want a situation in which we have rewards for bad management, and that is what this provision would do. I appreciate the vital role of mass transit in urban areas of this country. I understand the energy saving and environmental advantages of mass transit.
I submit, however, that we have an obligation to approach even the most commendable objectives in a rational, fiscally responsible manner.
Inflation is the most difficult problem facing this country today. We do have finite resources, and we do have competing objectives. Mass transit is one of the very high priorities, and seeing that we accomplish it effectively is our responsibility.
Section 104(c) is neither rational nor fiscally responsible. It is generous to a fault. It will encourage waste and inefficiency in the management of our mass transportation resources.
Mr. President, the Federal Government has recognized and accepted an obligation to help meet the deficits of local mass transportation systems. Last year we spent $750 million in this endeavor; we picked up 30 percent of the mass transportation deficits in this country. That is not an insubstantial effort; it is a commitment of major importance.
Some may argue that allocation formulas for offsetting grants have traditionally been unfair or inadequate since they have been based in the past on population and population density.
Many of these concerns and objections are addressed in the pending legislation, which adds to the formula such factors as age of bus fleets, bus seat miles, fixed guide way route miles, and community rail miles.
Section 104(c), however, goes too far. It constitutes fail-safe insurance for mass transportation systems, regardless of management practices or demonstrated need. By guaranteeing that the American taxpayer will pick up half of any deficit, providing it does not exceed one-third of total operating revenues, 104(c) constitutes an open invitation to inflationary mismanagement.
Let me cite an example of what this provision would entail. Let us assume that city X has a mass transportation system with operating expenses of $1 million and a deficit of $100,000. Let us further assume that the Government, under current legislation, picks up 45 percent of that deficit. The local taxpayers, in other words are out $65,000.
If 104(c) becomes law, it will not be long before local officials sense the significance of the legislation. The people in city X might reduce bus prices or they might raise salaries. And well they should. Let us assume that the local deficit rises 30 percent — to $130,000. The Government pays half and the city pays half, $65,000 apiece. The local jurisdiction, in other words, could purchase an additional $30,000 of deficit at no additional cost to itself.
I submit that such a provision is clearly lacking in logic and deserves prompt and overwhelming rejection by the Senate.
Mr. President, there are many worthwhile programs and problems in this country that could effectively absorb more resources than we can afford to commit to them. Mass transportation is a legitimate and worthwhile contender. It deserves our serious, sympathetic consideration.
But, like other problems and issues, it also demands a sense of fiscal responsibility; a rational allocation of finite resources; sound management practices, and a recognition that we simply cannot ask the American taxpayer to foot 50 percent of any mass transit incurred by an urban area.
The deficiencies of 104(c) are not limited to logic; the provision is costly in the extreme. It is estimated that 104(c) would cost about $900 million over the next 4 years. But this is only the beginning — it sets a policy which the urban mass transportation administration estimates could eventually require $2 billion per year to fully fund.
Let us do what we can for mass transit, Mr. President. But let us also recognize the constraints of the possible and delete section 104(c) from this bill.
Mr. BROOKE. Mr. President, will the Senator yield?
Mr. BENTSEN. I am happy to yield.
Mr. BROOKE. Does the distinguished Senator from Texas realize that his city of Houston already gets 50 percent of itsoperating deficit from the section 5 formula?
Mr. BENTSEN. I say to the Senator from Massachusetts that as this bill structured — and we are seeing a major change in the mass transit system of Houston and it is long overdue — but this one is structured, there is nothing to encourage management to be more efficient. There really is a bonus, in effect, for mismanagement. I do not believe that is a proper way to approach this.
Mr. BROOKE. That is a separate issue. The Senator talks about fiscal responsibility. There should be something called fiscal equity as well as fiscal responsibility.
I am just pointing this out to my distinguished colleague from Texas, and am not saying that it is irresponsible or anything of that nature, that Houston already receives at least 50 percent of its operating deficit under the section 5 formula.
Mr. BENTSEN. I say to the distinguished Senator from Massachusetts that providing fiscal equity does not make it right. With this provision, I cited the example of how transit authorities could raise their salaries substantially and they would not pick up any of it. They would let the Federal Government foot the bill.
Whether it is Houston, Austin, San Antonio, or Boston, we should try to think about the taxpayers of this country and see if they can get their money's worth, and we should encourage effective and efficient management in this country.
Mr. BROOKE. I could not agree more with the Senator from Texas. That is exactly what I believe in. I think that the Senator from Maine, the Senator from Oklahoma, certainly the Senator from New Jersey and I all agree that we have to be concerned about the American taxpayer. But we also should be concerned about the fairness of the allocation mechanism. Should population be the principal means of allocation or should it be commitment to mass transit? Many of the cities do not want mass transit at all. They do not want to put any money into it. They can solve their problems otherwise. But there are some cities that are committed to mass transit. They have done a lot for mass transit. Their whole economy depends upon mass transit systems, and that commitment cannot be measured by the population of the particular city.
Rural areas are also concerned about the need for mass transit, because they see that it is cost effective. It takes people to their jobs and it creates jobs.
Mr. BENTSEN. Let me say to the Senator from Massachusetts I held hearings in New York, Chicago, Detroit, Los Angeles, and Atlanta, on mass transit. I think Houston is late coming to the party. They have done a very poor job on mass transit. They have just passed a very substantial bond issue to try to do something about it. They advise me that the way they are going to fund it is by an increase in revenue and a substantial one.
But again whether it is Houston or any other city in my State, I am not going to support something that I think really does not put the incentive in there for more effective and efficient management. In fact it is the very contrary.
Mr. BROOKE. I think the Senator is absolutely correct. On the other hand, I do want to see equity for those cities that are committed to mass transit, those cities which are not faring equitably under the existing formula, and it is very difficult to get congressional legislation which takes that into effect.
It seems now that we are moving in the direction of revenue sharing, revenue sharing based upon population. And I am just suggesting to the distinguished Senator from Texas that in this amendment which was adopted by our committee we look at other criteria when we develop a formula that is going to be used for the distribution of mass transit funds. But I am certainly not picking on Houston by any means and I want the Senator from Texas to understand it. I simply pointed that out to him.
Mr. BENTSEN. I am picking on Houston myself, and I am glad to aid and abet.
Mr. BROOKE. I just mentioned Houston as a matter of personal knowledge that they do receive 50 percent or more of their operating deficit.
But, at any rate, I thank the Senator for yielding, and I do have a statement that I wish to make regarding the amendment which is proposed by the distinguished Senator from Maine and supported by the distinguished Senator from Oklahoma, the distinguished Senator from Texas, and others.
Mr. President, I must strongly oppose the amendment of my distinguished colleague from Maine.
Let me first explain what the supplemental operating assistance provision in this bill will actually do. The specific language of this provision tends to be overshadowed by the rhetoric about "guaranteed 50 percent funding," "inflation," "inefficiency," and "open-ended commitments."
Those are the words that I have heard this morning. Those are the words that I have heard before. I repeat them.
Guaranteed 50 percent, funding, inflation, inefficiency, and open-ended commitments, words with which we all disagree. I think that all of us here in the Senate and certainly the President, would find these words anathema.
The additional operating subsidy provision would be available for those local transit systems, or "urbanized areas," as they are called in this legislation, which do not receive 50 percent of their operating deficits under the section 5 formula for operating assistance.
If I may have the attention of the Senator from Maine, as the Senator from Maine recognizes, what we have tried to do in this legislation is to focus upon those urbanized areas, as they are called, which do not receive 50 percent of their operating deficits from the existing section 5 formula. That was the purpose of this provision, not inflation, not guaranteed 50 percent funding, not inefficiency, and certainly not open-ended commitments. That was the purpose of my amendment when it was introduced and that is what is would do. In order to promote an equitable distribution of funds, and I am sure the Senator from Maine understands the necessity for equity in this instance, this provision would provide that the Secretary of Transportation shall use the funds authorized in this section to bring those transit systems up to either a 50 percent level or to one-third of total operating expenses in accordance with the limit of maximum Federal participation established in this bill, whichever is the lower.
Therefore, even if the provision were fully funded, not all cities would receive full 50 percent funding, because of the cap of one-third of total operating expenses.
Mr: MUSKIE. Mr. President, will the Senator yield?
Mr. BROOKE. I yield.
Mr. MUSKIE. No. 1, with respect to the point the Senator made earlier, I, of course, do not quarrel at all with the intent or motivation of this amendment. What concerns me is its effect. I say in that connection that there seems to be general consensus that the current law did result in inequities. I am not sufficiently expert on all of the city transportation systems to comment in detail on that, but there was general consensus. And, as I understand the second tier of funding for operating subsidies, it was put together after a long and strenuous effort on the part of people concerned in trying to ameliorate those inequities and deal with them.
The Senator's proposal is supplementary to that second tier funding.
Our estimates of the costs are, first, with respect to the fiscal year 1979, the resulting costs would exceed the budget as it stands. Second. with respect to the estimates of future funding costs, those estimates have not been based upon the assumption that all cities support would rise to 50 percent of deficit, because you do have the one-third control.
But one of those estimates, the most pessimistic of them, comes from UMTA itself, and amounts to $2 billion; the CBO estimate is more conservative at $1 billion. No one really knows for certain how many cities will rise to the bait of 100 percent Federal support of higher deficits, therefore of higher wage settlements or of lower fares. But there is definitely an incentive for them to move in that direction.
Mr. BROOKE. Mr. President, if the Senator will yield, the Senator is well aware of the limitation. There is an authorization limitation in the first year of $127 million, in 1980 of $191 million, in 1981 of $255 million, and in 1982 of $318million. That is the limitation.
Mr. MUSKIE. I also understand the pressures for meeting the eligibility for funding in response to this formula. I mean, I saw evidence of it on the floor today. Your justification for the bill, in part, rests upon the fact that Houston now gets 50 percent of its deficit supported. Well, that is your argument for Boston. I imagine that a similar argument will be raised for every city offering mass transit system anywhere in the country, and I cannot believe those pressures will be resisted if we establish this policy of this eligibility formula in this bill.
Mr. BROOKE. Mr. President, if the Senator will yield, let me assure the Senator from Maine that cognizant as I am of the budgetary problems which he faces as chairman of our Budget Committee and, as he knows, I have supported him in his endeavors to stay within the budget, that is why the limitation was placed in the authorization.
What the Senator is suggesting is that we may not be able to hold to that limitation.
Mr. MUSKIE. I just recognize from 4 years with the budget process the kind of pressures that generate future years' spending. The time to apply the discipline is at the point where you create the pressure-generating policy. If it is not the intent that this policy should result in the kind of future year budget costs that I tried to project, then we ought to have a different formula. We ought to have a different policy. We ought not to deliberately put in place a policy that has this kind of pressure-generating potential, and I just think it has that potential.
I have looked over the pressure process, which is something of an education in a variety of fields, I might say. Every time I come to the floor I learn more things. I am not sure they are all stored in this inadequate head, but in any case, I do understand it.
There is, of course, wide diversity in the circumstances of mass transit systems in our cities across the country. Differences are reflected in fare levels, they are reflected in deficits, they are reflected in revenue responses, in the fare box revenues, and so on. There is great diversity, and I understand the difficulty of having to establish a policy that applies to those diverse circumstances.
But I just think that this proposal will generate pressure that Congress will not be able to resist, pressure to provide funding to the levels that will equal, hopefully, the conservative estimate of what those levels might be, and potentially to provide the higher levels estimated by UMTA, and it is for that reason that I am concerned. All this is in addition to the fact that the immediate effect of the formula is to breach the fiscal year 1979 budget levels.
(Mr. MELCHER assumed the chair.)
Mr. BROOKE. Let me assure my colleague from Maine—
Mr. MUSKIE. Let me emphasize, too, that the Senator has been a supporter ofthe budget process, so I would not want that ambiguity to be in the RECORD.
Mr. BROOKE. I thank the Senator.
I just want to say that being cognizant of that, in an attempt to be reasonable while at the same time attempting to correct what I believe, and I believe the Senator from Maine has already agreed, although he may not understand the extent to which inequities exist in funding for the various rapid transit systems around the country, that what we have tried to do in this bill is to try to correct those inequities while, at the same time, giving serious consideration to the budgetary problems we knew could exist. Therefore, the limitations are clearly contained in the authorization. I certainly would be one to resist the pressures, and I am quite aware that pressures would build. I have seen them build around here, and I know the Senator from Maine sees them every day. As a matter of fact, almost every bill we have on the floor requires his attention constantly, both in authorizations and in appropriations, to see to it that the pressures that build to go beyond our budget ceilings are rejected.
But I just wanted to assure the Senator that when I hear such language, as I said before, as "inflation, inefficiency, and open-ended commitments," that that was not the intent of the proposer of this amendment or my distinguished chairman, Senator WILLIAMS, or the members of the Banking, Housing, and Urban Affairs Committee on which the distinguished Senator from Maine once served himself.
It is a very serious-minded and very conservative committee, as he well knows.While there was not an overwhelming vote in the committee I must confess, at least the committee did vote on this provision with full knowledge of what its impact would be, and I think the deciding factors were based upon the inequities that presently exist in the formula.
There are many cities which we are trying to help here that are committed to mass transit and need increased mass transit. They have already demonstrated their desire to have a viable transit system by their own expenditures. So what we would be doing here is to correct an inadequate formula so that it would be a formula which did not short change those cities that want mass transit and have demonstrated not only their desire for it, but their intention to construct and to operate mass transit systems, which are so sorely needed in those cities.
I thank the Senator and I would just like to proceed and get back to another subject.
There is a second limitation also present in the bill. Recognizing the budgetary constraints and the fact that 50 percent funding is actually a goal — it is a goal and not a mandate — I want to point that out, because I think I heard language on the floor this morning which would indicate that some thought it was a mandate — I repeat it is not a mandate, it is just a goal — the bill provides that if appropriations in any given year are insufficient to finance fully the 50 percent provision, then those cities which are eligible for assistance under this provision would take a pro-rata reduction in supplemental assistance.
I think that is a real safeguard, and that was put in for a specific and obvious reason.
As I have stated, the 50 percent provision, far from being a floor, as some have claimed — and I heard this morning that it was a floor, and it is not a floor — it is rather a goal, which would represent the achievement of equity for those eligible cities under the operating assistance program.
This provision does not establish the principle that a city is entitled to receive 50 percent funding of its transit deficit. It recognizes the reality that some cities are currently receiving 50 percent funding and more under the formula, and that other cities, which are constrained by an inequitable population formula allocation, are not receiving their just share of funding. I think that is a laudable purpose, and it is based upon a material existing fact.
The city of Houston, as I pointed out, receives 50 percent or more under the present formula, and there are other cities which, because they have an inequitable formula allocation, are just not receiving their equitable share of the funding. In fact, the 11 cities which would gain under this provision represent a majority, almost 60 percent, of the transit ridership in the Nation, in the entire Nation, and I think that is very significant.
We are talking about people, we are talking about transporting people from job to home or wherever they need to be transported, and 60 percent of the entire ridership in the whole Nation would gain under this provision in these 11 cities.
Those three cities which are cited as major beneficiaries of the provision are New York, Boston, and San Francisco. They carry nearly 50 percent of our Nation's riders. Can you imagine, just three cities whose transit systems carry nearly 50 percent of our Nation's riders?
Now, mass transit operating assistance is not a general revenue-sharing program. It was never intended to be a general revenue-sharing program. Nor is it the same as a community development block grant program.
These funds are to be targeted at those local transit systems with demonstrated needs, those systems which provide substantial transit service, in localities which are willing to make a real local financial commitment to transit.
I somewhat liken it to the debate concerning the Department of Housing and Urban Development's UDAG program, which we considered on the floor earlier this year. The program provides discretionary money which the Secretary of HUD distributes to cities which have developed specific programs. Many believe that UDAG should be just another revenue-sharing program, when the purpose of that bill was to aid distressed cities wherever they may be in the country — cities that are really economically distressed and are deteriorating. It is not intended that all cities be eligible for that special program.
Some claim that, say, my own home town of Newton, Mass., which by no means could ever be classified as a distressed city, should share UDAG funds with, say, some of the cities around the country that are really distressed such as Detroit, for example, or Newark, N.J.,or Washington, D.C.
(Mr. NELSON assumed the Chair.)
Mr. BROOKE. I say again, under this provision we are not concerned with all cities, we are concerned with those cities that need and are committed to and are willing to make a real financial commitment to additional mass transit services.
I am proud to say that cities and towns across my own State of Massachusetts have made and continue to make that kind of substantial commitment to mass transit. They are aware of the energy shortage, of the pollution and congestion from just too many automobiles, and the need to serve our low-income families, our elderly, and our handicapped, who just cannot be transported from one place to another.
In fact, among Massachusetts mayors alone, this is not looked upon as an urban transit bill, it is called the Property Tax Relief Act of 1978. And any increased funds received by the Massachusetts Bay Transportation Authority would be used to reduce the share paid by property taxes in all the cities and towns in the MBTA area. The tax rate savings would be substantial — at least $10 in Boston, Revere, and Somerville, with similar substantial savings in at least six other Boston area communities. I would hope that other localities which have tax funds specifically committed to transit would propose similar savings for their localities under this program. As the mayor of Oakland, Calif., has written in support of this provision:
The communities of the San Francisco-Oakland urbanized area have made a substantial commitment to transit. Oakland taxpayers support their respective shares of both the Bay Area Rapid Transit District and the Alameda-Contra Costa Transit District. The supplemental operating provision will provide funds that will bring the percentage of Federal contribution closer to the 50 percent level of net operating expenses which is provided in other areas of the country.
In fact, it is not just the older, developed transit systems which gain under this provision. The Washington, D.C.-Maryland-Virginia Metro system, the Atlanta MARTA system, Denver, Portland, and Seattle are all expending large sums of money to develop and expand their transit systems and would all benefit under the supplemental assistance program.
It is an unfortunate fact of life that transit systems do run operating deficits. And it is also true that transit systems which are developing, expanding, up-grading, or purchasing new equipment are likely to face more substantial deficits. New systems, in particular, are likely to keep fares low in order to attract transit ridership.
We have seen that happen here in the District of Columbia, when the Metro first opened. It was a question of getting people to get out of their cars and into rapid transit, learning how to use it, rather than clogging up downtown Washington by creating traffic jams, which we have enough of with the tourist business in the city. And this happens not only in Washington, but in all the major cities of the country.
I believe that it would be a cruel deception for the Federal Government to provide substantial assistance to localities to build new transit systems and to upgrade and expand existing systems and then not provide adequate funding so that these systems may operate.
In other words, you let them build the system, and what can you do when the system does not have sufficient operating funds. You just cannot price this service out of the market. People are paying so much now to ride rapid transit systems that they just cannot afford increase fares in many cities. If it is not more economical for them to ride the transit system than it is for them to come into town with an automobile, and pay a high parking lot fee, then people will not use transit. And most cities today do not even have parking lots to adequately take care of people who come in with their cars, and then they just park illegally. It is getting so now you cannot even find an illegal place to park any more in many cities of this Nation; so that they really have a very serious transit problem on their hands.
There is one final point which I would like to address. I know the strong feelings of the administration in opposition to my provision. I know the strong feelings of the distinguished chairman of the Budget Committee, not on the issues I am talking about, because I think he agrees with me on the issues I have raised. He is only talking from his position as chairman of the Budget Committee, and I understand that and respect that position, and I feel the same with respect to the Senator from Oklahoma (Mr. BELLMON) .
So I shall not prolong this debate. I do want to call for the yeas and nays, after my distinguished chairman (Mr. WILLIAMS) has an opportunity to talk.
Mr. JAVITS. Mr. President, will the Senator yield to me?
Mr. BROOKE. Yes, I yield to my friend from New York.
Mr. JAVITS. I just wish to record myself as being for the Brooke formula, for one critical reason. It is the best way in which fair weight can be given to transit ridership, those who are saving gasoline and energy for the country. Failure to give weight to that item has resulted in very serious disadvantages to the major urban mass transit systems in the country. Three of these, New York, Boston, and San Francisco, have 50 percent of the transit riders in the country. New York alone has about 30 percent and yet receives only about 11 percent of Federal financial assistance. Cities over 1 million receive from the Federal Government approximately 6 cents per rider. By contrast, cities between 50,000 and 200,000 receive about 25 cents per rider.
Finally, as to the regulator — the fact that this will be handled temperately — municipalities have to come up with the other 50 percent of the operating deficit. I can assure you that in New York, that is an absolutely rigorous regulator. So I shall support Senator BROOKE's position.
Mr. BROOKE. I thank my colleague from New York. I have always said whenever you have problems in any city of this country, you can find them multiplied in the city of New York.
I know we have problems in transit, and this is a problem we will have to address. These three cities that I mentioned, New York, Boston, and San Francisco, actually carry 60 percent of the Nation's ridership.
But rather than belabor this debate, since we have had a very spirited debate, the chairman and the ranking Republican member of the Budget Committee, primarily, for budget reasons as I understand it, not that they are against rapid transit systems, have made their positions known. I see that our colleague on the Banking, Housing, and Urban Affairs Committee, the distinguished former mayor of the city of Indianapolis, and now a very distinguished member of our committee, is here to support this amendment. I believe that he would similarly raise the fiscal problems — none of my colleagues, I think, are against mass transit. And they recognize that at sometime in the near future we have to develop a formula which is more equitable than the formula which exists at the present time.
The final point I should like to stress before yielding to the chairman of the committee is whether this provision promotes inefficiency and inflation in the operating assistance program, as some critics have stated. As I have said, the cities eligible for this provision are subject to two caps:
One, 50 percent of the operating deficit, which would mandate a 50 percent local share — localities would have to come up with a 50 percent matching share — and one-third of total operating expenses. Those cities eligible for supplemental assistance are the only cities which must operate under both of these caps.
Under the existing formula, that does not exist. But under this formula, they would have to operate under both of those caps.
I believe that these two requirements constitute the most significant constraints against inflationary increases in the bill. Those are pretty severe constraints, when you have to come up with 50 percent local money, No. 1, and you are constrained by a one-third cap on operating expenses.
On the other hand, this bill eliminates the existing cap of 50 percent funding of operating deficits by the Federal Government and substitutes the "one-third of operating expense" maximum of Federal participation. I have yet to hear any complaint about the inequity and inflationary incentive of providing increased operating funds for those cities currently receiving 50 percent funding under the formula.
I never hear that. It is very strange, for those cities without the cap, there is no complaint at all.
Rather, the administration and my colleagues who support the amendment of the distinguished Senator from Maine target their attack — I am not talking about the Senator from Maine, I am talking about others — at those cities which have been unfairly treated under the existing formula and which are trying to "catch up" to those cities which are unfairly rewarded by the operation of the formula.
That is my charge. These cities are being rewarded and they are being rewarded unfairly, because they are really not even committed to mass transit. Yet they are getting the benefits without the liabilities or without the commitment, so to speak. The proponents of this amendment have certainly set a selective standard of fiscal responsibility.
May I add that once those cities eligible for supplemental operating assistance receive 50 percent of their operating deficits, they would have to provide one-half of any increase in operating expenses in order to receive increased Federal assistance. That would be likely to require increases in State or local taxes — such as property taxes — which, as we all know, will be very difficult for local officials to propose. Requiring an increase in State and local tax dollars is a most effective disincentive to increasing local operating deficits.
I do not think you will find many mayors out there now or many city councilors out there now who are prepared to increase property taxes. They have heard of proposition 13. They have read about it. They know about it. For them to increase taxes, you can bet your bottom dollar they will do so only under the closest scrutiny and only for the best and most compelling reasons; namely, the necessity to have a viable mass transit system.
Mr. President, I believe that the Committee on Banking, Housing and Urban Affairs has developed a legislative package which would provide a strong and equitable Federal commitment to urban mass transit. The amendment of my distinguished colleague from Maine severely distorts the equity and balance which the bill sought to achieve in the area of operating assistance.
It is the cost of operating transit systems which stands as the most severe impediment to the development and expansion of public transportation services in our urban areas. These costs represent a significant portion of State and local budgets. At the same time, all local tax sources — not just the property tax — are under great pressures today. I do not believe that it is a wise Federal response to cut back an important Federal program in an area of critical national interest which could reduce the burden placed on local tax sources.
I am aware that the Carter administration strongly supports the amendment of my distinguished colleague from Maine. It is impossible to understand how this administration can argue for a rational effort to address the problems of the scarcity and cost of energy and not recognize the critical role for mass transit in reducing energy consumption.
We talk about new sources of energy. We talk about capturing the wind and the waves and the Sun. But the best and sole source of energy is conservation. Conservation is one of the best sources of energy we have. If you do not use it, if you conserve it, you do not need to have any more. The more you can cut back, the less you will have to find; there is no question about that. Certainly, mass transit is one of the most important steps that we can take for conservation of energy in this country. I think everyone recognizes that.
If we could get more people out of the gas-guzzling automobiles and into mass transit, you have no idea what we can do so far as solving our national energy problems is concerned. I think that this program we are recommending here today is one that will do it. I just cannot understand how this is not understood downtown.
I believe that this administration has sent a clear message to the cities of Boston, San Francisco, Atlanta, Denver, Portland, Seattle, and other cities which are planning major investments in transit m the future. They are saying that the Federal Government is not prepared to make a definite and long-term commitment to the operation of mass transit in this country.
Therefore, Mr. President, though I know what the opposition is, I still, in good conscience strongly urge my colleagues to reject this amendment and to let our cities know that the Federal Government is prepared to act as a full partner in the most critical area of public transportation.
Mr. WILLIAMS. Mr. President, the Senator from Massachusetts has done a most able job of describing his amendment that is in the bill, that the amendment of the Senator from Maine would strike from the bill. Therefore, I am not going to take a great deal of time in stating here that I supported the Brooke amendment in the committee and support it here on the floor. I think it might be useful to take just a moment, however, to think through some of the problems we have when we are developing the distribution of funds under a formula. I think this is one of the toughest problems we have here in the Senate: to find equity as we direct the funds to the designed need that we have legislated for.
We see this in many areas.
Now, in transportation, we had a national program of urban mass transportation in the area of capital fronts for 10 years before we developed any program of support to the urban areas for the expenses, the operating costs, of running their systems.
Of course, within that period, the program was broadened in many ways and we tried to reach the small urban and rural areas. It took us 10 years to realize the necessity and, then implement what we realized the necessity of — a contribution to the costs of operations.
We knew this was necessary. We could see the decline and abandonment of transit systems even while we were prepared to make contribution for capital purposes.
So, in order to keep old systems alive and help defray the operating expenses, the Congress put in the operating assistance in 1974.
Now, in the original formula so that it would have a national reach, we restored to the simplest approach. We used population and population density factors. For practical reasons this was an approach which we are all familiar with.
That population-population density approach, however, did not reflect effort, and the intensity of transit operations, in many of our areas.
Transit intensity was not reflected in that formula. That is why we had these disparities in communities that could get 50 percent of their operating deficits out of section 5. That is why those highly intense transit areas, New York, Boston, Atlanta, and many others, were way short of that percentage of their operating deficit — way short.
This year with this bill we have improved the formula distribution and we get a lot closer to a realistic reflection of transit operations within the various areas.
But, even with that, there was not that fine tailoring of this legislation to all of the urban areas that are making a significant effort. This amendment of the Senator from Massachusetts is in response to that.
We know the areas that clearly would be reached by the Brooke amendment are those areas that have done a significant amount of work in the last few years to expand, improve, modernize, and to generally make transit all that it can be within those areas.
Take Atlanta, I believe that is one of the areas that has expanded so greatly to improve its mass transportation, public transportation systems and would receive money under the Brooke amendment. There are others, too.
Again, it comes down to the everlasting search for the equity in the situation the Brooke amendment represents, and I support it and hope it will stay in the bill.
Mr. METZENBAUM addressed the Chair.
The PRESIDING OFFICER. The Senator from Ohio.
Mr. METZENBAUM. Mr. President, I rise to support the Senator from Maine in an effort to delete this amendment. I do so in spite of the fact that I know that if the amendment remained in the bill it would be good for the community in which I live — Cleveland. I am told it would mean $20 million extra in the next 4 years.
It is very difficult for any Member of this body to stand up and oppose legislation that helps his own community. But I do so because I am concerned about the manner in which the Regional Transit Authority in Cleveland has been expending their funds.
I am concerned when I read about their hiring practically every executive who has worked for them in recent years on a consultant basis and paying them tremendously high fees, the purposes for which are not easily explained.
I am concerned when I read about the Regional Transit Authority in my own community sending people to various conferences, or making other kinds of expenditures, and then responding and saying, "Well, the Federal Government will pay 80 percent of it."
I believe in fiscal responsibility, whether or not it is the Federal Government's money, or whether it is the State government or the Regional Transit Authority, or any other particular body.
I have not seen that kind of fiscal responsibility on the part of the Regional Transit Authority in the largest community in Ohio. I have not seen them using competitive bidding, at times when they should have been using competitive bidding, but, rather, negotiating contracts that I questioned their negotiating, and saying that it is in the community's best interest.
So, although I know that it is difficult to oppose a proposal that is going to help one's own community, because I do live in a suburb of the Cleveland area and the RTA does serve my community, I believe that this is my way of saying to the RTA: "Look, it's time for you to take stock in yourself. There just is not an unlimited amount of money available to you at the Federal level, and somewhere along the line you ought to start to economize; you ought to look at the salaries paid to your executives because they are very high, indeed."
But no, they say that the Federal Government is going to pay 80 percent of it and they do not have to give that kind of concern.
I am concerned about lower fares for the people who ride the RTA in Cleveland. I would hope these moneys would cause those lower fares to result. But I also feel that maybe we have to say to an executive body such as this: "Quit thinking that the Federal Government has an unlimited amount of money available to you."
This is an instance in which I think we ought to send a message to some of the transit systems around the country, because I do not believe that Cleveland is alone in the wasteful expenditure of funds. I believe that they are typical of many other transit authorities throughout the country, because one of the answers has been, "Well, we're only paying the same amount of money that is being paid in other parts of the Nation."
I believe the people ought to be paid well, but I think those salaries ought to be comparable to other people in industry and in the governmental service.
Therefore, I rise to support the Senator from Maine in his effort to delete the amendment of the Senator from Massachusetts in this area.
Mr. BROOKE. Will the Senator yield?
Mr. METZENBAUM. I certainly will.
Mr. BROOKE. I certainly admire and respect the Senator's courage in what he has said. If he has that kind of situation existing in his city, and I regret to find that he does, then I think he is certainly within his right to do everything he can to alleviate that condition.
However, I want to point out to the Senator when he talks about 80 percent funding, that refers to capital assistance. When a city wants to construct a rapid transit system, they are eligible for 80 percent.
But this amendment does not direct itself at all to that 80 percent funding. I just wanted the Senator to be sure. We are here talking about operating expenditures, and that alone.
Cleveland gets less than 50 percent of its operating expenses. It gets about 25 percent, which is considerably less than other cities. The reason is that the section 5 formula, under which we are working, is an inequitable formula.
I know the Senator was not here during the debate, but the point I was trying to make — and the Senator has every right to support the amendment of the Senator from Maine to delete this from the bill — is that all the committee tried to do in adopting this provision was to bring equity into this whole question of operating deficits. It established two caps: a 50 percent cap and a one-third cap for operating expenses. It also would require a matching local 50 percent. The cities would have to come up with 50 percent themselves, and it would have to be cities, obviously that were committed to the program and that really were suffering.
Cleveland may have a unique problem. Cleveland has had several unique problems, as I have been reading recently, and I sympathize with that city.
I assure the Senator that this has nothing to do with the 80 percent. If they have been misusing that, if they have been hiring consultants they do not need, that should be corrected, not only in Cleveland but also anywhere we find it. We cannot waste Federal taxpayers' dollars or local taxpayers' dollars. If they are getting 25 percent under the existing formula, most of the money they are wasting, as the Senator from Ohio has said, is coming out of the local taxpayers' property taxes, I would assume, rather than from the Federal Government, because they are not getting it from the Federal Government. I think that should be brought to the attention of the Governor and the officials in the city of Cleveland.
But that is not my concern. My concern is merely to point out to the Senator that we are not concerned here with capital; we are concerned with operating deficits and an attempt to bring some equity into a situation which is inequitable at this time and has been inequitable — namely, the section 5 formula. This amendment would try to do exactly that and would do exactly that, even though, as the Senator from Maine pointed out, it could potentially have some budgetary problems.
Mr. METZENBAUM. I appreciate the clarification of the Senator from Massachusetts, and I do not take issue with him.
The 80 percent I mentioned was the quotation I used from the newspapers. I think they were somehow charged in as capital expenditures, to go to conventions and things of that kind, and to hire consultants. One way or the other, it comes out the same way.
I agree with the Senator from Massachusetts that the present formula is inequitable, and I share his concern about changing that formula. I am not certain that this is the manner in which to do it, but I feel that the formula should be changed, because I think my community is shortchanged. I am not certain that I am prepared to support changing it in this manner, but I hope that along the way we can make that change.
Mr. President, I ask unanimous consent that during the consideration of this bill, Mr. Tom Hall, of my staff, have the privilege of the floor.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. MUSKIE. Mr. President, will the Senator yield?
Mr. METZENBAUM. I yield.
Mr. MUSKIE. There are other points I would like to make in response to the Senator from Massachusetts and the Senator from New Jersey, along with the comment that the Senator from Ohio made, and to emphasize what was said earlier in the debate.
Independent of the Brooke amendment, the pending bill does undertake to reform the formula. For example, with respect to the additional amounts provided, independent of the Brooke formula, the city of Cleveland will get an increase of 72 percent over current law for its operating costs. It is one of the highest. Boston gets an increase of 118 percent. San Francisco, another city mentioned by Senator BROOKE, will get an increase of 98 percent. Philadelphia gets an increase of 131 percent. Chicago gets an increase of 94 percent and Cleveland 72 percent, and all others are under that.
Those changes are a reflection of the change in the formula that is in the bill if the Brooke amendment is stricken out of the bill. So Cleveland will get some relief. I thought the Senator would like to know that.
Mr. METZENBAUM. I appreciate the statement of the Senator from Maine.
I know that Cleveland will gain from it. I think we need that assistance. But I thought I should address myself to some of these practices that have concerned me over a period of months.
Mr. MUSKIE. I appreciate that comment, because it is a point that needs to be made with respect to the Brooke amendment and with respect to the widely varying circumstances in which the mass transit systems of many cities find themselves.
I have before me a table which I ask unanimous consent to have printed in the RECORD.
There being no objection, the table was ordered to be printed in the RECORD, as follows:
[Table omitted]
Mr. MUSKIE. Mr. President, the table shows the relationship between operating revenues and operating expenses as well as operating deficits in Boston, Chicago, New York, Philadelphia, and in the Nation as a whole. This table reflects widely varying differences. in these particular measures of the health and operating policies of these large mass transit systems.
For example, in the Nation as a whole, revenues over a 4-year period are 55 percent of operating expenses. That means that operating revenues are running about one-half of operating expenses in the Nation as a whole.
However, in Boston, for example, operating revenues are only 28 percent of operating expense levels. In Chicago, they were 69 percent of operating expenses; in New York, 58 percent; in Philadelphia, about 50 percent.
So there is a difference. Those differences reflect the effectiveness of management. They reflect possibilities of waste. They reflect differences in wage scales and wage policies, differences in pressures to control costs.
There are many stories I could put in the record, if I were aiming my remarks at particular cities, of poor management and wasteful management in our mass transit systems. All I am trying to focus on is not a catalog of mistakes or shortcomings by management of our mass transit systems but instead the incentives in the proposed policy with respect to wasteful and inefficient management.
I understand that about 75 percent of transit operating expenses represents wages. If the formula written into the bill by the Brooke amendment makes it possible to increase operating expenses by increasing wages entirely at Federal expense, the Senator understands, I think, what kind of pressures there will be for higher wage settlements because Uncle Sam will pick up the entire tab.
Mr. President, in the course of the debate, the distinguished Senator from Massachusetts has identified three cities particularly as cities that would be treated inequitably under the present formula — Boston, New York, and San Francisco. Under the committee bill, without the Brooke amendment, Boston, one of those three cities, would get increased apportionments for operating expenses of 118 percent — without the Brooke amendment.
New York would get an increase of 92 percent without the Brooke amendment. San Francisco would get an increase of 98 percent without the Brooke amendment. Only a few other cities get increases above 50 percent.
So that the bulk of the assistance for operating expenses provided by the committee bill, without the Brooke amendment, goes to the three cities which the Senator from Massachusetts has identified as three of the situations representing inequities under current law. So, obviously, without the Brooke amendment, the committee has gone a long way to correct the inequities represented in current policy.
The second point I should like to make with respect to the observations of the Senator from Massachusetts is this: He says he is not setting a policy of 50 percent, or 33 percent if the cost measure is controlling. But it is striking to me that he said his proposal originated out of the fact that in some cities, the Federal Government was covering 50 percent of the deficit. Obviously, he chose that as the norm toward which we should move. So if we adopt this policy, we are saying that it should be the policy. How fast we fund it will depend upon the budget resolutions, says Senator BROOKE.
But he is adopting it as a policy; 50 percent Federal funding of local mass transit deficits or one-third of operating costs, whichever is the lower.
So what he is saying is that it is policy, and if we can find the money in the Federal budget then we should try to find it to increase Federal assistance up to funding of 50 percent of local mass transit deficits or up to one-third of local operating costs. To the extent that Federal assistance in any community is below either of those policy objectives which are established by the Brooke amendment, we create incentives to increase operating deficits, to increase operating expenses, whether or not those increases are justified in terms of better service, more efficient service, or better management.
We are also taking the pressure off any incentive there may be to increase the fare, the fare box revenue in these cities. If operating costs, if wages can be increased without increasing fares on local riders, what local resistance then could there conceivably be? We should be asking the riding public in a community to carry a fair share of the burden of funding the expenses of the system.
So, Mr. President, our objection to this is not the shortcoming of any particular transit system. The appropriate committees, the appropriate Federal agencies have a responsibility under the current law as well as the pending bill to try to ride herd on things of that kind.
But what we are concerned about is the incentive that the Brooke amendment creates for further mismanagement, for further waste, for further expensive cost increases, for holding fares down when they should be increased. Whatever the policy mix one should have to get a better managed system, a more soundly financed system, the Brooke amendment creates pressures in the opposite direction.
The paymaster will be Uncle Sam's Treasury and that we cannot afford.
One further observation: With respect to the increases in operating subsidies which this bill provides, independent of the Brooke amendment, the total is $425 million of which $379 million or about 90 percent will go to the largest cities.
Mr. President, I ask unanimous consent that a table reflecting that fact be printed in the RECORD.
There being no objection, the table was ordered to be printed in the RECORD, as follows:
[Table omitted]
Mr. MUSKIE. Mr. President, the committee bill goes a long way without the Brooke amendment to deal with the problem which Senator BROOKE has described through most of his presentation here this morning.
Mr. President, I have nothing further that I need to add to the debate. I think Senator BROOKE indicated he wishes a rollcall vote.
I shall suggest the absence of a quorum so that we might try to corral the number of Senators required to request a rollcall vote.
Mr. President, I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The assistant legislative clerk proceeded to call the roll.
Mr. MUSKIE. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. MUSKIE. I ask for the yeas and nays on the amendment.
The PRESIDING OFFICER. Is there a sufficient second? There is a sufficient second. The yeas and nays were ordered.
The PRESIDING OFFICER. The question is on agreeing to the amendment of the Senator from Maine.
On this question, the yeas and nays have been ordered, and the clerk will call the roll.
The assistant legislative clerk called the roll.
The result was announced — yeas 74, nays 15 as follows:
[Vote tally omitted]
So the amendment (No. 3458) was agreed to.