Transit agencies see little immediate effect from government shutdown

Prolonged shutdown could limit funds for transit operations; shutdown limits federal accident investigations
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An inbound NJ Transit commuter train approaches Newark Broad Street Station with a Bombardier ALP-46 leading a string of new bilevels. If the federal government shutdown continues, the agency may need to draw on its line of credit to sustain regular operations.
Brian Schmidt
WASHINGTON – As the partial government shutdown drags on, worries grow for transit agencies and municipalities.

Moody’s Investors Service warns that a prolonged shutdown would negatively affect a range of sectors, including U.S. transit systems that could see their credit ratings turn negative. As an example, Moody’s points to NJ Transit, which the firm says relies on federal grants for bond payments.

Asked for comment, Jim Smith, spokesman for NJ Transit, tells Trains News Wire, “At this time, the lack of a federal budget that resulted in the shutdown has no immediate impact on current NJ Transit’s federally funded projects. Should the government shutdown be prolonged, we may need to draw on the credit facility more than anticipated. However, at this point, we are not seeking to raise the credit limit. Our current limit is $300 million and there is a zero balance.”

Sen. Chuck Schumer, D-New York, raised the specter of financial issues when he told the New York Post that the New York Metropolitan Transportation Authority stands to lose $150 million a month in reimbursements from the Federal Transit Administration. Schumer said that could lead to service cutbacks or the need to borrow funds.

Shams Tarek, a spokesman for the MTA, would only say that “a prolonged federal government shutdown would be bad news for customers and the MTA and we thank Senator Schumer for his leadership in fighting to stop it.”

Most transit agencies contacted by Trains News Wire reported few immediate concerns or impacts, but Kansas City’s Main Street Extension project, currently in the design phase, could be delayed. “We have not heard about the status of our New Starts Grant application and with the current federal shutdown, our timeline may be pushed a bit,” says Donna Mandelbaum, spokeswoman for the KC Streetcar Authority.

The Massachusetts Bay Transportation Authority expects to spend $2 billion this year on capital projects including new construction, new vehicles, and state-of-good-repair projects. Spokeswoman Lisa Battiston says the federal shutdown will not affect their plans. “Though federal formula funds or other federal grants are not available to be drawn from during the shutdown, delivery of the MBTA’s capital plan is unaffected as there are significant funds on hand with the ability to raise more, if needed.”

Dave Sotero, spokesman for LA Metro, says the agency expects to meet their current construction schedule, explaining that their expansion projects are primarily funded by state SB-1 funds and local sales taxes. “We already have secured federal funding for the first two segments of the Purple Line, which are now under construction.” He added that they anticipate receiving a Full Funding Grant Agreement for the third section of the Purple Line this year.

Dallas Area Rapid Transit will go ahead with construction for the new Cotton Belt Corridor this year, says spokesman Morgan Lyons. “The federal RRIF loan was closed prior to the start of the shutdown, so that should not affect our plans.” Similarly, Bill Brennan of the Honolulu Authority for Rapid Transportation, which is constructing a new 20-mile elevated rail system, says they are fine right now.

Erica Kato, spokeswoman for the San Francisco Municipal Transportation Agency, which is looking to complete its Central Subway project this year, says the agency is not concerned yet, but “if it were to carry on for many months, it could pose some coordination challenges.”

At the National Transportation Safety Board, the budget impasse has halted accident investigations. NTSB’s website, which is not being updated due to the shutdown, lists 11 major investigations into railroad accidents dating back to 2016. These including the derailment of Amtrak Cascades train No. 501 near Dupont, Wash., and the Feb. 4, 2018, collision of southbound Amtrak Silver Star train No. 91 with a CSX Transportation freight train in Cayce, S.C.

NEWSWIRETrains News Wire

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