Summary: GAO discussed the Urban Mass Transportation Administration's (UMTA) 5-year reauthorization proposal, focusing on the sources and uses of funds, increased funding flexibility between mass transit and highway, and UMTA oversight of grantees. GAO noted that: (1) between fiscal year (FY) 1981 and FY 1991, federal transit funding declined from $4.6 billion to $3.2 billion; (2) various legislation limited the Highway Trust Fund which, at the end of FY 1991, was expected to have $4.1 billion available; (3) UMTA proposed spending $16.3 billion between FY 1982 and FY 1986 and drawing down the uncommitted balance in the mass transit account to less than $1 billion by 1996; (4) an industry association estimated that $6.5 billion in federal funds would be needed annually to maintain the existing mass transit infrastructure; (5) the UMTA reauthorization proposal would allow state and local governments flexibility in allocating federal funds between mass transit and highway projects, but several obstacles could limit the success of such multi-modal funding; (6) the proposal could continue the existing bias for highway construction over mass transit; (7) the proposal would shift a larger share of the financial burden to grant recipients by reducing the federal share for capital projects from 80 percent to 60 percent; (8) greater cost-sharing by states, localities, and grantees could promote leveraging of scarce federal funds, but caution should be exercised in making an immediate shift of financial responsibility to transit authorities; and (9) UMTA did not effectively oversee grantees' management and use of federal funds, which placed those funds at risk for waste and misuse.
