This document is the Secretary of Transportation's report to the General Assembly summarizing efforts undertaken in the Commonwealth of Virginia in Fiscal Year 2017 (FY17) to leverage the state's investments in transit and transportation demand management (TDM) programs. A primary goal of these efforts, and part of the mission of the Department of Rail and Public Transportation (DRPT), is to reduce highway congestion and single occupant vehicle usage through transit, vanpooling, carpooling, teleworking, and other commuter services.

DRPT's efforts to increase transit usage, reduce congestion, and decrease reliance on single occupant vehicles through its funding and programs have been consistently successful.

Efforts to boost these numbers continue apace: (i) There are now a total of 41 transit agencies in all nine Commonwealth Transportation Board districts, following the addition of a new system in 2017; (ii) service expansion is occurring throughout the state; and (iii) DRPT continues to help its partners promote TDM efforts, such as Vanpool!VA and Telework!VA.

Transit Usage and Trends in the Commonwealth: In 2016, DRPT finalized a statewide mobility study to provide a snapshot of the state of travel in the Commonwealth of Virginia. The study highlighted and underscored the changing dynamics of transportation and provided additional direction to DRPT on how to wisely invest its limited federal and state funding to further its agency goals. A notable finding of the study was that even though the population of Virginia increased by 7.8 percent between 2007 and 2015, the number of single occupant vehicle trips decreased by six percent. Transit usage in Virginia also increased during that time period:

2007

Total transit usage: 5.1%
Bus transit usage: 1.8%
Rail transit usage: 3.3%

2015

Total transit usage: 6.8%
Bus transit usage: 3.0%
Rail transit usage: 3.8%

Total transit usage nationally increased by a similar rate over the same time period. Additionally, utilization of teleworking and/or compressed work schedules rose from 4.5 percent to 8.3 percent, and the number of employers offering formal telework programs increased to 20 percent.

Effectiveness of Transit Services Proven in Smart Scale: SMART SCALE prioritizes projects based on their effectiveness at meeting the transportation goals of the Commonwealth. This process then ensures that localities and transit agencies will be concentrating on developing the best projects for SMART SCALE applications in the future. During this process, DRPT worked with localities and agencies to identify potential projects; and DRPT also provided technical assistance and project data to help complete the applications.

In SMART SCALE Round 2 for FY18 funding, 17 public transportation projects across six districts were selected for $168 million. These transit projects selected demonstrate transit's high return-on-invest for public dollars. Additionally, the fact that transit projects scored so highly is indicative of transit's high value for alleviating congestion and addressing other transportation policy objectives.

• The third and fourth highest benefit-to-cost scores in the second round of SMART SCALE were transit projects: Columbia Pike Smart Corridor and Valley Metro's Smart Way expansion.

• The transportation project with the highest raw benefit score was the Fredericksburg line capacity expansion for Virginia Railway Express (VRE).

The Hopper, Lynchburg's downtown circulator, and the Averett Cougar Express, Danville Transit's new route, were the first SMART SCALE projects completed in the Commonwealth. Both projects were completed and initiated service in August 2017.

Metrorail Safety Commission: The Washington Area Metropolitan Area Transit system is part of the multi modal transportation network that supports the economic vitality of Northern Virginia. Recent ridership numbers indicate that Metrorail carries over 300,000 riders daily from Virginia.

Federal law mandates state safety oversight to heavy rail transit systems operating under their jurisdiction, and new administrative rules promulgated in 2016 gave all states until 2019 to receive federal certification. However, in early 2016, the Federal Transit Administration (FTA) assumed full federal safety oversight over Metrorail and gave Virginia, Maryland, and the District of Columbia until February 2017 to institute a new, fully certified state safety oversight agency.

DRPT continues to proactively work with Washington D.C. and Maryland to ensure that FTA requirements for certification are met. During its 2017 session, the General Assembly enacted legislation to meet federal law and certification requirements creating the Metrorail Safety Commission (MSC). The D.C. Council passed identical legislation in 2016, and Maryland followed suit in March 2017. As required, Congress gave its final approval by passing a resolution in August 2017; and President Trump signed the resolution that same month. On October 20, Governor McAuliffe appointed two Commissioners to the MSC Board.

Innovative Methods For Improving Mobility Along Most Congested Highways: Some of the most congested roadways in the Commonwealth, I-66 and I-395, will witness major transformation due to implementation of High-Occupancy Toll (HOT) lanes that provide reliable travel option to residents and businesses while improving traffic flow along general purpose lanes that will continue to remain free.

While the I-395 Express Lanes, I-66 Inside the Beltway, and I-66 Outside the Beltway projects will result in major improvements, there is a need to provide other reliable travel options to the public. DRPT worked with the Virginia Department of Transportation (VDOT), Northern Virginia Transportation Commission, and other local entities to provide a package that ensures a steady stream of revenue for much needed transit services along those transportation corridors. These transit services will provide low-cost reliable travel options to area residents, remove cars from those congested roadways, and also improve traffic flow for everyone. Transit will receive the following funding to expand services:

• I-395 Express Lanes: Annual $15 million payment.

• I-66 Inside the Beltway: $9.8 million in 2017 to fund the first group of multimodal improvements selected by the Northern Virginia Transportation Commission.

• I-66 Outside the Beltway: $800 million over the next 50 years to fund new point-to-point, peak period commuter bus services that will begin operation in the corridor when the Express Lanes open in 2022.

Ensuring Continuation of Critical Transit Funding: In 2019, $110 million in dedicated revenues-44 percent of all program funding-will begin to phase out as the ten-year life of the Capital Project Revenue bonds comes to a close. The General Assembly passed HB1359 to establish the Transit Capital Projects Revenue Advisory Board (RAB) during the 2016 Session as recognition of the need to identify new funding sources for transit capital investments. This legislation further required that a prioritization process for funding transit capital investments be explored.

Over the past year, the RAB worked to quantify the gap between transit capital needs and available funding, evaluate potential revenue options, identify a possible process for prioritization of transit capital projects, and outline recommended changes to the structure of the transit capital program.

An evaluation of the Commonwealth's documented funding needs and projected revenues has conservatively identified an average revenue gap of $130 million annually over the next ten years, representing a drop of over 40 percent from existing funding levels. In 2020, the estimated gap will be $35 million; and it will grow to an estimated gap of $178 million by 2027.

Without addressing the shortfall, public transportation agencies will not be able to maintain the assets the Commonwealth has already invested in. Agencies will not be able to deliver today's level of service, and there will be increased maintenance costs with fewer routes and less transit service on the road. Decreased quality and reliability of public transportation directly impacts the ridership of transit, especially when it comes to services that address congestion such as commuter routes and rapid transit systems. The August 2017 RAB report to the General Assembly outlined an approach to addressing the capital revenue shortfall.

Investments in transit and TOM are reflective of the importance of both in the Commonwealth and their vital role in creating a sustainable and equitable multi modal future. Reducing both congestion and the number of single occupant vehicles is one of the agency's goals-one at which it excels-but it is important to note the other benefits of transit and TOM as well. These benefits as well as statewide and locally-based initiatives to meet the goals are further explained in this report.