By Mark Aesch
CEO, TransPro
Millions of people who work in the public transportation industry woke this morning to the sound of a turntable needle screeching across vinyl.
The Acting Director of the White House Office of Management and Budget (OMB) Matthew Vaeth took action through Presidential Executive Order to freeze all federal and domestic aid. This impacts hundreds of billions of dollars for health care agencies, school districts, and yes, transit agencies.
In our view, there appears to be three elements of this action.
- Congressionally Approved Funding: The Executive Order goes out of its way to include the following language. “To the extent required by law, federal agencies may continue taking certain administrative actions, such as closeout of Federal awards (2 CFR 200.344), or recording obligations expressly required by law”.
This language seems to suggest that if an agency is in the active use of a Congressionally authorized grant, the strong likelihood is it is not in jeopardy.
- Non-Congressionally Approved Executive Action Funding: Inconsistent with the New Administration’s Agenda, this may apply to grant funds disbursed in the days leading up to the election, and certainly in the nearly 100 days that have passed following the election.
These grants will likely meet a heightened level of scrutiny, and recipients should be most worrisome. These are funds that the outgoing Administration authorized from subjective pot of tax dollars, and the incoming Administration will query, in their words “the consistency with the President’s agenda”.
- Non-Congressionally Approved Executive Action Funding – Deemed Consistent with the New Administration’s Agenda: These are grants that have been made both in recent months, and perhaps even longer, deemed “consistent with the President’s agenda”.
The strategic question is how do agencies make the reasonable argument they are in Bucket #3? How do transit operators make the argument they are consistent?
- Clear and measurable value
- Innovative methodologies to bring greater value to taxpayers.
- A broad internal and external communications strategy to deliver the above two.
This is a significant action by the White House. It will require significant (and new methods of communication) to keep the resources that agencies have worked so tirelessly to receive.
It is likely that the arguments that secured the grant will not be the same arguments to retain it if transit agencies want to hear the music of money play again.