SEATTLE -- The municipal finance industry should find rewards in innovative federal transportation legislation passed in 1991, but this will take some time, transportation officials told municipal analysts yesterday.

The intermodal Surface Transportation Efficiency Act marks a new focus on flexible use of federal funds, Hank Dittmar, manager of legislation and finance at the Metropolitan Transportation Commission, said. The commission is the San Francisco Bay Area's regional transportation planning agency.

Dittmar said the act also spotlights increased regional and local decision making and more efficient management of existing transportation facilities.

He made his comments at the annual conference of the National Federation of Municipal Analysts, which this year has set a record. About 200 analysts have attended the meetings, according to a federation official.

The transportation act, which provides about $150 billion, targets new financial, opportunities, including use of federal funds for toll facilities and focusing funding on a wide variety of technology initiatives, such as high-speed rail projects.

Many of the new possibilities represent "a revolutionary change." said Richard Mudge, president of Apogee Research. which specializes in public works policy issues. Generally, however, "none of these innovative things have happened yet." he said.

Regarding ISTEA, "everyone is looking at what the opportunities are because it's been so heavily promoted," said Thomas Clash, director of planning and program management at New York State's Department of Transportation.

One problem, Clash said, is that there have been expectations the transportation world would "turn on a dime" and implement the legislation. There has been pressure to "spend that money as fast as we could," he said, but "it flies in the face of reality" because the programs envisioned by the legislation are longer-term in nature.

Clash said the new approach is "a positive one" and opens the door to innovation, but he noted the adjustments to mandates such as shared decision making will take time.

Mudge noted that funding of more than $150 billion established by the act is really "not much money" for the entire nation, which could be another impediment to seeing the full power of the changes for a number of years.

In another panel yesterday, municipal analysts heard an executive recruiter discuss trends affecting their field.

According to a national survey of municipal research directors, almost 70% of firms that responded will add analysts over the next five years, said David Morris, managing director and Houston branch manager of Russell Reynolds Associates Inc.

Almost all of the firms with hiring plans indicated they would add between one and five analysts, Morris said. This number may seem small, but Morris noted that numerous firms have smaller staffs to begin with compared to other industries.

The anticipated hiring plans generally coincide with expected asset growth by many firms over the next five years. If current ratios in the survey of roughly one analyst per $1 billion of assets are a reliable predictor, the field could add "well over 100 new [analysts'] jobs in the next five years," Morris said.

The survey also shows the importance of continuing training and education for the field, Morris said.

"The colleges are not essentially equipping people to do the job you do," Morris said, noting that 84% of the survey respondents held that opinion.

Regarding compensation, Morris said "this is a well-paid profession" with a "normal distribution" for pay levels based on experience.

The base and bonus pay for analysts can range from $38,500 for newer hires to $115,400 for those with five years or more of experience, Morris said. But he stressed these figures "are midpoints" and can vary widely among firms and individuals.

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