The Federal Transit Administration (FTA), part of the Department of Transportation (DOT), announced on November 12, 2025, the availability of its final policy guidance for the Capital Investment Grants (CIG) program. This guidance amends the version published in December 2024 and incorporates feedback from public comments on proposed changes issued in August 2025. The updates, effective immediately, refine the evaluation process for discretionary transit grants under 49 U.S.C. 5309, focusing on environmental benefits and land use criteria. By streamlining complex calculations, the guidance seeks to expedite project reviews without compromising the program's integrity, potentially accelerating funding for public transportation initiatives across the United States. This development is significant as it aligns with statutory requirements for biennial updates and responds to industry calls for reduced administrative burdens, while ensuring FTA can fulfill its obligations to rate projects and recommend funding in its annual report to Congress.
Background on the CIG Program
The CIG program provides federal funding for major transit capital projects, including new fixed guideway systems, core capacity improvements, and small starts projects. Governed by 49 U.S.C. 5309 and regulations at 49 CFR part 611, it requires FTA to evaluate projects based on criteria such as mobility improvements, environmental benefits, cost-effectiveness, and land use. The policy guidance complements these regulations by detailing evaluation methods and procedural steps. FTA must update this guidance at least every two years or when making significant changes, as mandated by 49 U.S.C. 5309(g)(5). Previous iterations, including the 2013 shift to a vehicle miles traveled (VMT)-based environmental assessment, have evolved to balance analytical rigor with practicality. Key players include FTA Administrator Marcus J. Molinaro, who signed the notice, and project sponsors such as transit agencies that apply for grants. The program's framework draws from precedents like the National Environmental Policy Act (NEPA), which addresses broader environmental effects separately from CIG's focus on benefits.
Key Changes to Environmental Benefits Evaluation
A central amendment replaces the VMT-based methodology for assessing environmental benefits with a simpler approach tied to EPA air quality designations. Under the prior system, projects were rated based on monetized changes in emissions, including the social cost of carbon. The new method assigns ratings using the EPA Green Book's classifications for criteria pollutants: carbon monoxide, nitrogen dioxide, ozone, and particulate matter. Projects in nonattainment or maintenance areas receive a 'High' rating, while those in attainment areas get a 'Medium' rating. This shift responds to comments highlighting the old method's complexity and data intensity. For instance, FTA noted in the notice that the VMT approach was 'complex, subject to varied interpretations, data-intensive, complicated, and burdensome.' Supporters, including transit agencies and policy groups, praised the change for reducing administrative burdens and streamlining the CIG process. Critics, however, argued it oversimplifies analysis and removes climate considerations, potentially conflicting with statutory requirements for a 'comprehensive review' under 49 U.S.C. 5309(d)(2)(A)(iii). FTA countered that the method still evaluates benefits against a no-action alternative by prioritizing areas with poor air quality, where transit can reduce vehicle emissions. The update aligns with Executive Order 14154, issued by President Trump, which withdrew the Interagency Working Group's social cost of carbon guidance, citing logical deficiencies and lack of legislative basis. FTA clarified that projects spanning multiple areas with varying designations will receive a 'High' rating if any part is in nonattainment or maintenance zones.
Adjustments to Land Use Criterion
The guidance removes urgent care facilities from the 'access to essential services' measure within the land use criterion. This change stems from the discontinuation of the Homeland Infrastructure Foundation-Level Data (HIFLD) set by the Department of Homeland Security, which previously provided location data. Commenters noted the broader HIFLD shutdown, announced after FTA's proposal, and suggested alternatives like the Census Bureau's North American Industry Classification System (NAICS) for future evaluations. FTA declined to revise rating breakpoints, reasoning that essential services constitute a small portion of the overall project rating—about 1.67 percent. Supporters viewed this as a practical response to data loss, while one commenter expressed concern over diminished consideration of healthcare access. The land use criterion remains one of six project justification factors, ensuring projects are assessed holistically.
Response to Public Comments and Broader Perspectives
FTA received 16 comments on the August 2025 proposal, from transit agencies, interest groups, individuals, and others. Roughly half supported the environmental changes for their simplicity, with some criticizing the social cost of carbon as flawed. Opponents worried about losing climate metrics and urged retention of VMT-based analysis. FTA addressed legal concerns by emphasizing that environmental 'benefits'—not 'effects'—are the focus, with effects handled via NEPA. Two comments fell outside the scope, such as general calls for CIG streamlining. Perspectives vary: industry groups see efficiency gains, environmental advocates fear weakened climate analysis, and legal experts debate statutory fidelity. No endorsements are made here, but these views highlight tensions between regulatory simplification and comprehensive evaluation.
Implications and Potential Trajectories
The immediate effective date, justified under the Administrative Procedure Act for good cause, allows FTA to resume project ratings stalled by the social cost of carbon revocation. Short-term, this could speed up funding allocations in the FY26 report to Congress, benefiting ready projects. Long-term, it may encourage more applications by lowering barriers, though critics warn of undervalued environmental impacts. FTA plans to update companion documents like reporting templates soon, maintaining January 2025 versions interim. Ongoing debates include integrating new data sources or refining metrics, with FTA open to future industry collaboration. Potential challenges involve adapting to data changes or legal challenges to the methodology. Trajectories could include further deregulation under Executive Order 14192, which deems this a deregulatory action with unquantified savings, or reversals if policies shift.