Main Street Chases Transportation Money (The Center for Public Integrity)

Last September, city fathers in Dubuque, Iowa, lured three members of the White House cabinet to the banks of the Mississippi River on the same day they welcomed officials from one the world’s biggest corporations, IBM. Transportation Secretary Ray LaHood, Environmental Protection Agency Administrator Lisa Jackson and Housing and Urban Development Secretary Shaun Donovan, accompanied by a host of aides, all climbed aboard the city’s green trolley car. Among their stops: Dubuque’s renovated harbor area, and then the historic millwork district — once the nation’s largest — and the nearby Roshek building, a depression-era department store undergoing a grand remodel.

Meanwhile, Dubuque’s private sector guest, IBM, was over at the convention center announcing plans to make the city a living laboratory for its Smarter Planet program. Up to 1,300 new IBM employees will begin fielding tech service calls later this year at the Roshek building, and the company hopes those workers will also be able to enjoy the fruits of a sweeping partnership between IBM and its host city — a partnership aimed at creating an integrated transportation system involving smart new bus routes, pedestrian-friendly streets, and arterial roads to take trucks out of neighborhoods.

It sounds positively idyllic, but there is, of course, a catch. In order to begin turning this vision into a reality, Dubuque wants a federal investment of $50 million. The economic returns would be 50 to one, officials maintain. And while that’s impressive, federal transportation policy has rarely been geared to reward such things, let alone Dubuque’s partnerships among local and state government and the business community. Instead, the process of seizing federal transportation dollars has often been a political free-for-all, with some of the biggest fights in Washington, D.C.

“I told them we had in essence a 21st-century project here,” says Mayor Roy Buol of his multi-pronged transport plan. “But we’re trying to get money through a 20th-century funding stream.”

Indeed. On that September day, Buol’s municipal government was among more than 650 cities and counties paying federal lobbyists to help deliver them transportation dollars from the nation’s capital. While polls show Americans don’t want to make transportation policy through earmarks, that hasn’t stopped local officials from going after them. As lawmakers grappled with renewal of an expiring multi-year transportation law last September, the number of cities and counties lobbying on transportation had grown by 80 percent since the last time a transport bill was about to expire, in the fall of 2003. And the cities and counties who list transportation as among their priorities spent a total of more than $35 million lobbying Washington through the first three quarters of last year; if even a quarter of that spending was solely devoted to transportation, it totals more than $8 million, a hefty sum for cash-strapped local governments.

Those numbers track with another sobering trend line. The Bipartisan Policy Center, a Washington think tank, notes that the last few transportation bills “have been marked by the rapid proliferation of federal transportation programs and by an increasing reliance on congressional earmarks,” adding that “both are symptoms of lack of focus and accountability.”

A harsh judgment, to be sure. But until the local lobby sees a new vision from Washington, the scramble for cash remains the only way to play, insiders say.

Earmarks and Stimulus Spending

Officials break ground on Hawaii’s Kapolei Interchange Complex, one of many projects earmarked for funds from an appropriations bill that passed last month. The project, mostly reliant on federal funds, will provide greater access to a major freeway. Just last month, for instance, Congress passed its appropriations spending for 2010, including more than $52 billion for highways and transit. Most of this money flows to states and transit agencies to be spent at their discretion, but hundreds of local governments circumvented that by winning earmarks from their congressional delegations. Hawaiian members, for instance, marked more than $3.4 million for the Kapolei Interchange Complex. Dubuque won $389,600 from its Iowa Senators to go towards the construction of an arterial road to help divert truck traffic from its downtown and neighborhood streets; officials there have been trying unsuccessfully to fund the road for more than a decade. Neither earmark will fund the entire project, so local officials will likely be back to ask for more. In both those cases, the state will provide little or no matching funds.

“I’m conflicted,” says Alameda County, California, Commissioner Scott Haggerty of the earmark process. “Because in a way, I like earmarks. You can’t stop cities and counties from going forward and saying ‘I need this project.’ But there has to be accountability to it.”

The 100-plus separate programs stuffed into those multi-year transportation bills have also been an earmark bonanza. Washington’s last multi-year transportation bill, made famous in 2005 for earmarking a so-called “bridge to nowhere” in Alaska, contained more than 6,300 earmarks. . Leaders of the House Transportation committee managed last summer to draft a new $500 billion measure for the next six years. But that bill stalled in committee when no one could agree how to pay for it. So the previous law — which was set to expire September 30 — has now been extended three times.

In the meantime, other transportation dollars are still coming in from the American Recovery and Reinvestment Act. More commonly referred to as the stimulus bill, it included more than $35 billion for highway and transit spending — distributed largely through pre-established formulas. That means most money has flowed directly to the states, in this case free of congressional earmarking. But $1.5 billion of that cash was set aside for something new: so-called TIGER grants, or Transportation Investment Generating Economic Recovery, from the Department of Transportation, for which local governments directly competed with states, transit agencies, ports, and others. All were required to prove how their project would measure up to a set of goals, such as long-term economic development. The department ultimately raked in 1,380 applications worth $56.5 billion for those limited TIGER grants, leading Congress to appropriate another $600 million last month for a similar program. Dubuque is among those with its fingers crossed. Within a month, it will know its fate.

And finally, there’s one fresh hat in the ring — proposed new stimulus legislation known as the Jobs for Main Street Act. The bill, which narrowly passed by the House before its holiday recess, would provide more than $35 billion for highway and transit projects , essentially paying for another extension of transportation law through September. A variety of other federal money, which could eventually include revenues raised from a climate bill, holds additional appeal. Just last month Secretary LaHood announced $280 million for streetcar and bus projects.

All these developments make navigating the waters a complicated — though potentially lucrative — process for local governments.

Lots of Washington Lobbyists

Part of Dubuque’s transportation plan includes construction of a road that would divert truck traffic from the city’s main streets and residential neighborhoods. As a result, lots of governmental entities want their own Washington lobbyists, in order to compete for the cash. Data from the third quarter of 2009 shows that, on top of the 650 cities and counties, those contracting with lobbyists include more than a dozen states, 90 mass transit agencies, 45 local development authorities, and 25 metropolitan and regional planning organizations. The national organizations for state transportation departments have a very strong lobbying presence, as does the American Public Transportation Association, which works on behalf of the nation’s mass transit agencies. Then there are umbrella local government groups like the National League of Cities and the National Association of Counties.

Alameda County commissioner Haggerty is among those advocating for both local causes and fundamental reform. Haggerty chairs not only the San Francisco Bay Area’s nationally respected planning organization, the Metropolitan Transportation Commission, but also a federal policy committee at the National Association of Counties, which is pushing Congress for more county-level input.

The city of Alameda shares the same lobbying firm, Holland & Knight, as does its neighbor the city and county of San Francisco. That firm is one of ten that represent more than 260 local governments with a stated interest in transportation spending. The county of Alameda also shares a common lobbying group, CJ Strategies, with San Francisco’s transit agency. Oakland’s nearby transit agency contracts with the boutique firm Simon and Company, which has 15 municipal transportation clients in its portfolio, including Madison, Wisconsin, and Salt Lake City, Utah.

Another Simon client, Mayor Jim Brainard of Carmel, Indiana, hired the firm shortly after entering office with a vision for remaking his growing, affluent Indianapolis suburb. “Part of the problem in my experience,” says Brainard, “is transportation agencies look at moving people, but they’re not interested in what it does to commerce. They’re not interested in land planning. They’re very narrowly focused.” That view helps explain why a local leader would turn to Congress for help. But it also leaves Congress free to pick and choose among all those voices — and some argue that this comes often at the expense of the greater public interest.

“We do infrastructure as a result of a highly politicized, election-day process,” says Rep. Keith Ellison, a Minnesota Democrat. Ellison told a Washington crowd in December that the system should instead make decisions based strictly on merit, “rather than helping somebody to say, ‘Hey, I just put a bridge in your district, so vote for me next time.’”

Reforming the Process

For years local governments have lobbied to shake up the way transportation is funded, with modest success. A new program here. A bit more money there. But this time the local government lobby is dramatically raising its voice and garnering attention. As the U.S. Conference of Mayors meets January 21 with President Obama, Secretary LaHood, and the White House economic team, part of the discussion will turn to both direct transportation funding from the proposed Jobs for Main Street Act and a $50 billion program put forth by the House to fund “metropolitan mobility” in the next long-term transportation bill. The initiative doesn’t go as far as distributing money directly to metropolitan areas based on their economic output, which the conference of mayors would like, but it would award more grants directly to those metro areas of at least a half-million people, bypassing state departments of transportation. Staffers working on the bill say that last bit is receiving a healthy share of opposition.

“Transportation dollars should be funneled through metros,” argues longtime Schaumburg, Illinois, Mayor Al Larson, who sits on the board of the Chicagoland area’s planning organization, which would oversee those funds. Larson’s suburb of 76,000 is the second largest center of retail development in the state. Larson argues that Illinois has “a screwed up state [government]” that “can’t get anything done.” “They’re so damn road oriented,” adds Larson, whose top priority is a commuter rail line. In reality, every state is a different story.

A Small City’s Path

The development of the interstate highway system — which goes back to the presidency of Dwight Eisenhower — is widely considered America’s last great transportation vision. But it mostly missed Dubuque. The city saw some tough times since then — tough times that have spawned a crop of current leaders intent on nurturing what is now nationally recognized as a business-friendly environment.

In coming weeks, the Obama administration will award its $1.5 billion in TIGER stimulus grants to a few of the hundreds of cities, counties, states, and other entities that applied.To build on that reputation, the city’s TIGER stimulus proposal includes constructing the arterial road that’s already been partially funded through an earmark. Other components involve overhauling downtown streets so they are more bike and pedestrian friendly, and partnering with IBM on a data collection program that would allow the city to efficiently manage its traffic flow.

“We want to be a model for communities under 200,000,” says a hopeful Mayor Buol. In its quest, last year Dubuque contracted with the Ferguson Group, a Washington lobbying firm that represents more transportation clients than any other Beltway outfit. Ferguson specializes in helping local communities navigate what two of its lobbyists have called a congressional “Chinese menu” of funding options. The Dubuque Area Chamber of Commerce is also registered to lobby through a firm run by former area congressman and White House budget director Jim Nussle.

Dubuque is joined by lobbyists for dozens of other groups with TIGER applications, including cities, counties, port authorities and transit agencies in at least 18 states. The ports of Houston and Gulfport, Mississippi, are among them. Even the Philadelphia Museum of Art.

Beth Osborne, the Transportation Department’s deputy assistant secretary for policy, also sat in that trolley car in Dubuque last September. Osborne says the program is forcing her department to develop relationships with new levels of government — including cities like Dubuque. In the next few weeks it could reward some of them. Statistically speaking, Dubuque is still a long shot, since so many have applied for that TIGER money. But the Obama administration is hopeful the TIGER grants mark the beginning of a process in which transportation funding is based on both merit and stated goals. Last week, for instance, the Transportation Department announced plans to change the federal transit application process. And at Congress’ behest, the department will spend 2010 crafting its own vision for the next federal transport law.

When the feds on that trolley tour asked Dubuque’s leaders what it is they wanted most, their first response was to be rewarded in that transportation bill. But not with an earmark. “We need supportive policies,” assistant city manager Teri Goodman told them. “That’s what we ask for.”

That could be a while. For now, she’ll be happy to take whatever the city can get.

Computer-assisted reporting specialist M.B. Pell and staff writer Caitlin Ginley also contributed to this report.