None of FTA's $14 billion in transit grants was verified

When Congress passed the Infrastructure Investment and Jobs Act (IIJA) in 2021, it told the Federal Transit Administration (FTA) -- the Department of Transportation agency that funds transit construction and expansion -- to check something before writing big checks for new systems: whether the applicant was also keeping the system it already has in a state of good repair.▸ A Department of Transportation Office of Inspector General audit⧉ -- DOT's own independent watchdog, reporting on FTA's use of FTA's own money -- found the agency skipped that check on more than half the funds involved. Of the $14,034,586,006 FTA awarded in Capital Investment Grants (CIG) from January 2023 through January 2025, FTA determined the repair-progress requirement simply didn't apply to $7,271,699,805 of it. For the remaining $6,762,886,201, the agency took the applicant's own word.

IIJA authorized up to $23 billion for the CIG program through 2026 -- discretionary grants for new rail lines, streetcars and bus rapid transit, roughly two-thirds more money than the prior five-year law provided.▸ The law's tradeoff, which FTA's own economic analysis acknowledged⧉, is that every dollar spent building new track is a dollar not spent maintaining the track a transit agency already runs. So IIJA required FTA to confirm an applicant was making progress on its own Transit Asset Management (TAM) repair targets -- the federally mandated benchmarks every transit agency sets for its buses, railcars, facilities and track -- before FTA could award it money to expand.

FTA decided that requirement didn't apply to 5 of the 19 CIG grants it awarded in the review window.▸ Four were smaller (two Austin, TX bus-rapid-transit projects, one in San Bernardino, CA, and one in St. Paul, MN, totaling $391.7 million) and were excluded because the applicants had filed their construction-grant requests before FTA's January 2023 guidance took effect, even though the grants themselves were awarded afterward. The fifth was not small: the $6.88 billion Hudson Tunnel Project -- a new two-track heavy-rail tunnel under the Hudson River into Manhattan's Penn Station, and the single largest CIG grant FTA has ever awarded. FTA exempted it because the applicant, the bistate Gateway Development Commission, doesn't itself own or operate transit assets -- even though the tunnel will be used by NJ Transit, which does have its own repair targets. That one grant alone accounts for 94.6% of everything FTA exempted.

For the other 14 grants -- $6.76 billion -- FTA did apply the check, but "primarily relied on CEO attestations," a signed letter from the applicant's own chief executive, rather than independently confirming anything in it.▸ That falls short of the Government Accountability Office's fraud-risk framework⧉, the government's own codified standard for program integrity, which instructs managers to "conduct data matching to verify key information, including self-reported data" -- precisely the step FTA's process omits.

The letters themselves varied wildly in what they actually said.▸ King County Metro in Seattle, the City of Madison, and the Port Authority of Allegheny County in Pittsburgh submitted formal letters citing specific data from the National Transit Database and explaining how they were meeting their targets. VIA Metropolitan Transit in San Antonio submitted bullet points with little reference to any specific target. The Indianapolis Public Transportation Corporation and Nevada's Regional Transportation Commission of Southern Nevada sent letters that mostly affirmed a general "commitment to" repair -- not evidence that repair was happening. FTA staff read all of it, OIG found, but verified none of it.

The stakes are not abstract.▸ FTA and DOT's Volpe Center estimated⧉ in January 2025 that the nation's transit systems carry a $140.2 billion state-of-good-repair backlog -- the value of buses, railcars, track and facilities that have already fallen below the condition FTA requires, up from $101.4 billion just four years earlier. That backlog is roughly ten times everything FTA awarded in new construction grants over the two years OIG reviewed. FTA runs a separate program, the State of Good Repair Grants Program, that gave states $4.3 billion in formula funding for maintenance in fiscal year 2025 alone -- money flowing specifically to fix the kind of shortfall the TAM check exists to track. The CIG check was Congress's attempt to make sure the expansion side of FTA's budget didn't work against the repair side. OIG's finding is that FTA cannot currently show that it does.

OIG's finding is not that any of the 19 grant recipients failed their repair targets -- nobody checked closely enough to know.▸ Its single recommendation asks FTA to "develop and document implementation of a methodology to verify" applicant progress before awarding future CIG grants. FTA concurred on October 1, 2025, and told OIG it plans to propose revised CIG policy guidance addressing verification "by May 30, 2026," as part of a broader rewrite of the program's rules. Until that guidance exists, OIG classifies the recommendation "resolved but open" -- FTA has agreed to fix the gap but has not yet done so, and nothing besides its own timeline compels it to.