Argued Oct. 5, 1988.
Before HIGGINBOTHAM, MANSMANN, and GREENBERG, Circuit Judges.Reargued In Banc May 15, 1989.
Before GIBBONS, Chief Judge, and SEITZ, HIGGINBOTHAM, SLOVITER, BECKER, STAPLETON, MANSMANN, GREENBERG, HUTCHINSON, SCIRICA, COWEN, and NYGAARD, Circuit Judges.OPINION ANNOUNCING THE JUDGMENT OF THE COURT
BECKER, Circuit Judge.This case, before us on consolidated cross-appeals from the judgment of the district court, requires us to construe a welter of statutory provisions establishing the obligations of recipients of federal financial assistance to provide accessible public transportation for the handicapped. The statutory provisions involved are section 16(a) of the Urban Mass Transportation Act (“UMTA”), 49 U.S.C.App. § 1612(a) (1982); section 504 of the Rehabilitation Act of 1973, 29 U.S.C. § 794(a) (1982 & Supp. V 1987 & West Supp.1989); section 165(b) of the Federal-Aid Highway Act, 23 U.S.C. § 142 note (1982) (Bus and Other Project Standards); and section 317(c) of the Surface Transportation Assistance Act of 1982 (“STAA”), 49 U.S.C.A.App. § 1612(d) (West Supp.1989) (originally codified at 49 U.S.C.App. § 1612(c) (1982)). The principal question before us is whether certain regulations promulgated by the Department of Transportation (“DOT”) at 49 C.F.R. § 27.95 & 27.97 (1987), delineating local transit authorities’ obligations to meet the needs of the disabled, are in compliance with these statutes. The regulations were challenged by seven disabled individuals and twelve organizations, who brought one of the consolidated actions on behalf of themselves and their mobility-impaired members (“ADAPT”), on the grounds that they were in derogation of the applicable statutes.
The first challenged regulation, 49 C.F.R. § 27.95 (1987), gives local governments the option to effectuate the purposes of the statutes through either ccessible mass transit, paratransit,1 or a combination of both. The district court concluded that the regulation was not an arbitrary and capri*1187cious exercise of delegated authority and granted summary judgment for the defendant Secretary of Transportation on this issue. Contending that the law requires mainline accessibility, or “mainstreaming,” and that the regulations’ paratransit-only option obviates that requirement, ADAPT appeals, No. 88-1177.
The other challenged regulation, 49 C.F.R. § 27.97, is a safe harbor provision insulating transit operators that spend 3% of their average operating costs from further liability under the statutes. The district court granted summary judgment for the plaintiffs on this issue, holding that the safe harbor was arbitrary and capricious. The district court set the regulation aside and remanded for further consideration by the Secretary. The Secretary, contending that the safe harbor provision was necessary to keep expenditures for transportation for the disabled within reasonable bounds, as mandated by the statutes, appeals, No. 88-1139.2
For the reasons that follow, we will affirm, though on remand we will require the district court to set a timetable for the Secretary’s further rulemaking.
I. STATUTORY AND REGULATORY HISTORY
The first of the relevant statutes to be enacted was the Urban Mass Transportation Act of 1964, amended by Congress in the Urban Mass Transportation Assistance Act in 1970. The Act provides for federal financial assistance to local transit operators. The 1970 amendments added section 16(a), which declared a national policy that
elderly and handicapped persons have the same right as other persons to utilize mass transportation facilities and services; that special efforts shall be made in the planning and design of mass transportation facilities and services so that the availability to elderly and handicapped persons of mass transportation which they can effectively utilize will be assured....
49 U.S.C-App. § 1612(a).
Subsequently, Congress passed section 504 of the Rehabilitation Act of 1973, commonly known as the civil rights bill of the disabled. Section 504, which was introduced by Senators Humphrey and Percy as an amendment to the Civil Rights Act of 1964, provides that:
No otherwise qualified individual with handicaps in the United States ... shall, solely by reason of her or his handicap, be excluded from the participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving Federal financial assistance
29 U.S.C. § 794(a).3
Congress then enacted section 165(b) of the Federal-Aid Highway Act of 1973, which directed that
[t]he Secretary of Transportation shall require that projects receiving Federal financial assistance ... shall be planned, designed, constructed, and operated to allow effective utilization by elderly and handicapped persons who, by reason of illness, injury, age, congenital malfunction, or other permanent or temporary incapacity or disability ... are unable without special facilities or special planning or design to utilize such facilities and services effectively_ The Secretary shall not approve any program or project to which this section applies which does not comply with the provisions of this subsection requiring access *1188to public mass transportation facilities, equipment, and services for elderly or handicapped persons.
23 U.S.C. § 142 note.
To implement these statutory mandates, DOT promulgated regulations in 1976 requiring local planners to make “ ‘special efforts’ in planning public mass transportation facilities and services that can effectively be utilized by elderly and handicapped persons.” 41 Fed.Reg. 18,234 (1976).
Moreover, two days before the regulations were published, then-President Gerald Ford issued Executive Order Number 11,-914, 41 Fed.Reg. 17,871 (1976), directing the Department of Health, Education, and Welfare (“HEW”) (now the Department of Health and Human Services, see 20 U.S.C. § 3508 (1982)), to coordinate implementation of the non-discriminatory policy announced in section 504 for all federal agencies.
HEW’s guidelines, issued in 1978, required all recipients of federal funds to mainstream handicapped persons by making public transportation “readily accessible to and usable by handicapped persons.” 45 C.F.R. §§ 85.57(a), 85.58(a) (1978). The HEW guidelines stressed that participating programs should authorize those options offering access “in the most integrated setting appropriate.” 43 Fed.Reg. 2132, 2138 (1978). With respect to public transportation, the HEW guidelines specifically required retrofitting of subways and buses to make these modes of transportation fully accessible to the disabled. 45 C.F.R. §§ 85.57(b), 85.58.
Importantly, even though the language of HEW’s guidelines appeared to require mainstreaming, HEW was careful not to preclude the possibility of paratransit. HEW stated that it “wish[ed] to make clear that it does not construe [the guidelines] to preclude in all circumstances the provision of specialized services as a substitute for, or supplement to, totally accessible services.” 43 Fed.Reg. at 2134.
In 1979, DOT promulgated regulations in compliance with the HEW guidelines. Those regulations contained requirements mandating across-the-board alterations to ensure that all transportation facilities were made accessible to handicapped persons. 44 Fed.Reg. 31,442 (1979). The 1979 regulations, accordingly, were viewed as requiring transit operators to retrofit their existing systems to make them accessible to the handicapped.
The 1979 regulations were immediately challenged by the American Public Transit Association, a trade association of public transit operators. In American Public Transportation Association (APTA) v. Lewis, 655 F.2d 1272 (D.C.Cir.1981), the Court of Appeals for the District of Columbia Circuit invalidated the retrofitting requirements as inconsistent with section 504. APTA v. Lewis, 655 F.2d at 1278. The court found that compliance would require extensive modifications to existing systems and would impose heavy financial burdens on local transit authorities. The court remanded and directed DOT to determine whether other statutes could support the extensive requirements of the regulations.
Subsequent to APTA v. Lewis, DOT promulgated interim regulations. 46 Fed. Reg. 37,488 (1981) [hereinafter 1981 Interim Regulations]. Pursuant to these regulations, recipients of federal funds were required to make “special efforts” to accommodate the transportation needs of the handicapped but could elect under “local option” provisions how to do so. Local transit operators were to opt whether (1) to make their buses accessible by the installation of wheelchair lifts; (2) to establish a paratransit system, separate from the regular transit system, using vans that could accommodate wheelchairs; or (3) to establish a mixed system, using accessible buses for some parts of the system and paratran-sit for other parts. The 1981 Interim Regulations also contained a safe harbor: transit operators would be relieved of their obligation to provide transportation services to the handicapped as long as they spent 3V2% of UMTA funds on such services. Under the regulations, once the spending requirement was met, there would be no federal scrutiny of the extent of the trans*1189portation services provided to the handicapped.
Then, in January of 1982, DOT announced a notice of proposed rulemaking. 47 Fed.Reg. 1890, 1891 (1982). Noting the 3V2% safe harbor provision, DOT observed that without any substantive criteria, the quality of the transportation services offered handicapped persons might be inconsistent or quite low in some geographical areas. DOT stated it was considering three alternative approaches, each of which would allow local transit authorities discretion to determine the type of service they would offer.
Apparently dissatisfied with the slow pace of DOT’s rulemaking, Congress, in December of 1982, enacted the Surface Transportation Assistance Act of 1982, 49 U.S.C.A.App. § 1612(d), which requires that DOT issue regulations to establish minimum criteria for the provision of services to the disabled.4 In fact, when the provision of STAA ordering DOT to establish the minimum service criteria was proposed by Senator Cranston, he criticized the 1981 Interim Regulations as “a total abdication of Federal responsibility for protecting handicapped persons from discrimination and inadequate services.” 128 Cong.Ree. 30,822, 30,824 (1982); see also 128 Cong.Ree. 32,634, 32,642 (1982) (Sen. Riegle saying same). Senator Cranston underscored the need for the provision as follows:
[A] most unfortunate situation [exists] in which the Department of Transportation’s hands-off, local-option, self-certification, no-monitoring, and no-criteria position is transforming the antidiscrim-ination laws into meaningless symbols. And it is not just that accessible bus service is fast becoming a lost hope in many parts of the country; the special services — paratransit—for handicapped persons are proving to be unsatisfactory.
The present course is clearly not the answer. Not only are we headed toward affording handicapped and elderly persons third-class treatment, but we are frustrating our own efforts to rehabilitate people, help them get back into productive activities, be more independent, and get off of disability and welfare rolls. Mobility is certainly critical to these efforts, and it is a tragic waste to fund vocational rehabilitation programs and then frustrate those rehabilitation efforts by failing to insure that we continue to make progress in enabling disabled persons to find and to get to and from work.
128 Cong.Ree. at 32,643.
On September 8, 1983, DOT published a second notice of proposed rulemaking to replace the 1981 Interim Regulations. See 48 Fed.Reg. 40,684 (1983). The proposed regulations would continue to allow local transit systems to select how they would provide for the transportation needs of the handicapped. However, in contrast to the 1981 Interim Regulations, the 1983 proposed regulations would have established six service criteria that special transit systems were required to meet.
The next step in the rulemaking process proceeded from the case of Maine Association of Handicapped Persons v. Dole, 623 F.Supp. 920 (D.Me.1985), in which the district court criticized the Secretary’s “unimaginably leisurely pace” in promulgating the final regulations and entered an order directing that the regulations be issued. 623 F.Supp. at 926. On May 20, 1986, the Secretary published the regulations at issue here. See 51 Fed.Reg. 18,994 (1986). Subpart E of the regulations maintains a local option provision and establishes minimum service criteria for handicapped persons for the three different types of transportation services: accessible bus, para-transit, and a combination of the two. The minimum service criteria for each of the available options take into account: (1) nondiscriminatory eligibility; (2) maximum re*1190sponse time; (3) no restrictions or priorities based on trip purpose; (4) comparable fares to those for the general public; (5) comparable hours and days of service; and (6) comparable service area. See 49 C.F.R. § 27.95.
After setting forth the detailed service criteria, Subpart E sets forth the current safe harbor provision:
(a) Calculation. To determine its limit on required expenditures for a given fiscal year, the recipient shall calculate 3.0 percent of its total annual average operating costs (as reported to UMTA in compliance with requirements under section 15 of the Urban Mass Transportation Act, as amended) it reasonably expects to incur in the current fiscal year and did incur during the previous two fiscal years.
(b) Effect. A recipient is not required, in any fiscal year, to spend more than the amount of its limit on required expenditures that fiscal year in order to comply with this subpart, even if, as a result, the recipient cannot provide service to handicapped persons that fully meets the service criteria specified by § 27.95(b), (c) or (d), as applicable. Each recipient shall, in all cases, comply with § 27.95(b)(1) or (c)(3)(i), as applicable.
49 C.F.R. § 27.97(b).
II. THE CURRENT ACTION
In its complaint for declaratory and in-junctive relief, ADAPT requested the district court to vacate Subpart E of the Department of Transportation’s 1986 regulations, alleging that Subpart E’s local option provisions unlawfully permitted recipients of federal transportation systems to exclude handicapped persons from effective and meaningful access to federally-assisted transit systems. ADAPT further attacked the regulations on the ground that the provision excusing full compliance with federal disability rights statutes beyond expenditures of 3% of operating costs was invalid.
In its complaint, ADAPT contended that denial of accessibility resulted in confinement of its members to segregated specialized transportation facilities, increased the burden of obtaining employment, education and meeting other essential needs, restricted- opportunities to take part in cultural, social and community activities, and abridged the opportunity to exercise guaranteed constitutional rights.
In addition to its contention that the regulations were promulgated in violation of the enumerated transportation statutes described above, ADAPT charged that the challenged regulations violated section 10(e) of the Administrative Procedure Act, 5 U.S.C. § 706 (1982). ADAPT claimed that the rules were promulgated in bad faith, without sufficient factual basis, without adequate explanation, without sufficient consideration of reasonable alternatives, and hence, in an arbitrary and capricious manner.
On cross-motions for summary judgment, the district court held that DOT could reasonably conclude that Congress has not legislated mainstreaming the disabled into public transportation. The court thus upheld DOT’s implementation of a local option policy and granted summary judgment on that issue in DOT’s favor. See Americans Disabled for Accessible Public Transportation v. Dole, 676 F.Supp. 635, 640-41 (E.D.Pa.1988) (Katz, J.).
The district court held, however, that the 3% safe harbor provision was an arbitrary and capricious exercise of delegated power. ADAPT, 676 F.Supp. at 642. The court recognized the agency’s responsibility to consider costs in determining what efforts transit providers are to take to accommodate the handicapped. Nonetheless, it found the 3% figure unreasonable on the facts of the administrative record. The district court determined that although DOT may properly take costs into account, it “may not ... abrogate entirely the rights granted by th[e] statutes” by cost considerations. Id. at 641. The court concluded that there was no rational connection between the facts found and the choice made and that the decision to impose the 8% safe harbor provision ran contrary to the evidence before the agency. Therefore, on the challenge to the safe harbor provision, *1191summary judgment was entered in ADAPT’s favor. Declining to rewrite the regulations to delete the arbitrary portions, the court remanded the matter to DOT, directing it to formulate regulations resolving the conflicting goals of equality for the handicapped and cost efficiency.5 As noted above, both sides appealed.6
III. VALIDITY OF THE LOCAL OPTION PROVISION
A. Is Mainstreaming Required?
The threshold question is whether mainstreaming is required by the relevant federal statutes. None of the statutes at issue expressly require local transit authorities to provide mainstreaming for mobility-impaired individuals. While some portions of the legislative history support a mainstreaming requirement, there is also much evidence of congressional opposition to mainstreaming and a preference for local option. The Supreme Court has held that “if the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency’s answer is based on a permissible construction of the statute.” Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 843, 104 S.Ct. 2778, 2782, 81 L.Ed.2d 694 (1984). Given the breadth of the Secretary’s discretion to fashion appropriate minimum criteria for handicapped services, we must accord particular deference to the standards set forth in the challenged regulations. The Secretary struck a balance between preserving local discretion, avoiding the imposition of unduly burdensome costs, and ensuring adequate transportation services for the handicapped. If this balance represents a permissible reading of the statutes, the regulations must be upheld even if we would have struck a different balance in the absence of the regulations. See Chevron, 467 U.S. at 843 n. 11, 104 S.Ct. at 2782 n. 11.
1. Section 504 of the Rehabilitation Act
In attempting to discern what is required by the language of section 504, we must view it in light of two countervailing legislative concerns: (1) effectuation of the statute’s objectives of assisting the handicapped; and (2) the need to impose reasonable boundaries in accomplishing this purpose. See Alexander v. Choate, 469 U.S. 287, 299, 105 S.Ct. 712, 719, 83 L.Ed.2d 661 (1985). The Supreme Court first considered the balance between these considerations in Southeastern Community College v. Davis, 442 U.S. 397, 99 S.Ct. 2361, 60 L.Ed.2d 980 (1979). In Davis, a deaf plaintiff, denied entry to a nursing school because she could not participate in the nursing program without full-time supervision, alleged that the school’s admission decision violated section 504. On review, the Court determined that section 504 requires that an “otherwise qualified handicapped individual” must be provided with *1192meaningful access to benefits that a federal fund grantee offers. The Court defined the phrase “otherwise qualified” as “one who is able to meet all of a program’s requirements in spite of his handicap.” 442 U.S. at 406, 99 S.Ct. at 2367.
The Court carefully circumscribed its mandate that otherwise qualified individuals may not be treated differently by holding that section 504 does not compel fundamental alteration to programs receiving federal assistance since such radical adjustments would constitute an “unauthorized extension of the obligations imposed by [§ 504].” Id. at 410, 99 S.Ct. at 2369. The Court then concluded that “neither the language, purpose, nor history of § 504 reveals an intent to impose an affirmative-action obligation on all recipients.” Id. at 411, 99 S.Ct. at 2369.
The Court found that Southeastern’s physical qualification requirement for its nursing program was legitimate and that to change it would alter the fundamental nature of the program. Since Davis could not meet this requirement, she was not otherwise qualified under section 504 and Southeastern’s decision to exclude Davis was not discriminatory.
The Court clarified Davis in Alexander v. Choate, 469 U.S. 287, 105 S.Ct. 712, 83 L.Ed.2d 661 (1985). Challenged in Choate was a state’s proposal to impose a limitation on the number of annual in-patient hospital days for which state Medicaid would reimburse hospitals on behalf of Medicaid recipients. A class of disabled Medicaid recipients argued against the 14-day limitation, asserting that the proposal’s implementation would have a disproportionately adverse impact on the disabled in violation of section 504. As in Davis, the Court held that the proposal did not preclude meaningful access to or exclude the handicapped from Medicaid services in a way that violated section 504. The Court amplified its Davis holding and stated that federally-funded programs were required to make reasonable modifications to accommodate the disabled. The Court interpreted section 504 as imposing two limitations on the duty to accommodate.
It clearly enunciated the first limitation that accommodations necessitating fundamental or substantial changes to the nature of the program were not mandated. The second, concerning the extent of expenditures required to effectuate the alteration, was not as fully delineated. As the Court explained, “[t]he balance struck in Davis requires that an otherwise qualified handicapped individual must be provided with meaningful access to the benefit that the grantee offers.” Choate, 469 U.S. at 301, 105 S.Ct. at 720; see Davis, 442 U.S. at 405-06, 99 S.Ct. at 2366-67. In both Choate and Davis, the Court recognized that where handicapped persons’ needs can be accommodated without imposing undue financial or administrative burdens, the refusal to make necessary modifications might become unreasonable and discriminatory. See Choate, 469 U.S. at 301, 105 S.Ct. at 720; Davis, 442 U.S. at 412-413, 99 S.Ct. at 2370. In both cases, however, the Court refused to mandate the modifications sought because they were “substantial.” See Choate, 469 U.S. at 308-09, 105 S.Ct. at 724; Davis, 442 U.S. at 413-14, 99 S.Ct. at 2370-71. Choate and Davis therefore contemplate a continuum in which some modest modifications may be necessary to avoid discrimination but other more substantial modifications are not required by section 504.
In its final rulemaking, DOT characterized Choate as an elaboration of the “undue burden” standard announced in Davis. See 51 Fed.Reg. 18,996 (1986). DOT noted that although Choate was decided after the expiration of the comment period on the proposed regulation, DOT would have entertained additional comments on the impact of Choate had it believed it necessary to do so. DOT, however, construed the holding in Choate as consistent with Davis to the extent that if accommodations entail extensive costs and administrative burdens, the refusal to undertake alterations to a program is not discriminatory. See id.
The district court disposed of the reasonable accommodation issue by stating that it had reviewed section 504 and concluded that Congress has not yet legislated main*1193streaming for the disabled in public transportation. ADAPT, 676 F.Supp. at 639 (“Congress has not yet legislated equality for the handicapped regardless of cost”). The district court then upheld the validity of Subpart E’s local option provision.
Neither Supreme Court precedent nor section 504 on its face addresses the extent to which federally-funded transportation programs are required to make physical modifications to accommodate disabled people. However, every federal court that has addressed the question whether mainstreaming in public transit is required has concluded that section 504 does not mandate mainstreaming. See, e.g., Rhode Island Handicapped Action Committee v. Rhode Island Public Transit Authority, 718 F.2d 490, 494-99 (1st Cir.1983); American Public Transportation Association v. Lewis, 655 F.2d 1272, 1277-78 (D.C.Cir.1981); Disabled in Action of Baltimore v. Bridwell, 593 F.Supp. 1241, 1250-52 (D.Md.1984), appeal dismissed, 820 F.2d 1219 (4th Cir.1987).
The difficulty in determining precisely the extent of accommodation mandated by section 504 is illustrated by the history of the regulations intended to implement section 504. As previously discussed, the regulations were subject to much revision prompted either by executive, legislative or judicial pressures.
In the absence of a clear congressional mandate, the Supreme Court’s decision in Chevron, 467 U.S. 837, 104 S.Ct. 2778, requires us to defer to an agency’s interpretation of the relevant statute in its regulations. The regulations we consider today were enacted pursuant to a broad delegation of discretion under statutory standards that this Court has previously characterized as ambiguous at best. See Disabled in Action of Pennsylvania v. Sykes, 833 F.2d 1113, 1117 (3d Cir.1987), cert. denied, — U.S. -, 108 S.Ct. 1293, 99 L.Ed.2d 503 (1988). Applying the Davis/Choate standard, we conclude that section 504 does not mandate mainstreaming.
2. The Urban Mass Transportation Act
Nothing in the plain language of section 16(a) of UMTA suggests that Congress has mandated mainstreaming. While portions of the pertinent legislative history support ADAPT’s position,7 a thorough reading of the statutory text and the legislative history suggests that Congress gave the Secretary broad discretion to address the transportation problems of the handicapped rather than requiring one particular solution, i.e., mainstreaming.
Section 16(a) expresses a clear intent to increase the accessibility of federally assisted mass transportation. It speaks, however, in broad and general terms that cannot fairly be construed as establishing particular standards or mandating a particular federal policy. Section 16(a) requires only that federally assisted programs make “special efforts” to ensure that the handicapped can effectively utilize transportation services. It requires that the handicapped be able to utilize mass transportation systems, but does not explicitly or implicitly mandate the means by which mass transportation must be made available to the handicapped. Under the common understanding of the phrase, it is surely possible to conclude that a community has made “special efforts” to ensure that the handicapped may use mass transportation facilities and services even if those efforts do not actually enable the handicapped to fully exploit each of those facilities and services. Because section 16(a) does not unequivocally require the Secretary to implement mainline accessibility, Congress apparently left the Secretary broad discretion to map out the contours of an appropriate federal policy.
*1194Every federal court that has squarely addressed the contention that section 16(a) mandates mainstreaming has held that it does not. See, e.g., Rhode Island Handicapped Action Committee, 718 F.2d at 497, 499 (finding that section 16(a) provided no “legislative standards to guide a court in this area” and concluding that guidance on the appropriate implementation of the statute must come from the Secretary); Atlantis Community, Inc. v. Adams, 453 F.Supp. 825, 881 (D.Colo.1978) (“In [UMTA and § 504], Congress said do something for the mobility handicapped and left it to the Secretary to determine what that something should be.... [T]he federal statutes ... do not provide a sufficient definition of the duties of the federal [transportation officials] to give direction to them.”); Vanko v. Finley, 440 F.Supp. 656, 660 (N.D.Ohio 1977) (rejecting “plaintiffs contention that [section 16(a) ] requires that ‘all transit rolling stock and facilities [must be able to be] effectively utilized by all mobile disabled and elderly people’ ” and finding no “statutory infirmity in ... the operation of a separate paratransport system parallel to the main bus and rapid systems”); see also American Public Transit Association v. Goldschmidt, 485 F.Supp. 811, 823 (D.D.C.1980) (generality of congressional expression in UMTA and § 504 establishes broad delegation of authority; “law, the hete-rogenous character of the handicapped population, the breadth and variety of the states and communities affected, and the uncertain and changing technology available preclude a Congressional prescription of the particular means for carrying out its policy”), rev’d on other grounds sub nom. APTA v. Lewis, 655 F.2d 1272 (D.C.Cir.1981).
In light of UMTA’s broad language, which clearly does not define the ways in which UMTA was to be effected, we also conclude that section 16(a) of UMTA does not mandate mainstreaming, but rather grants wide latitude to the Secretary to determine how best local governments are to comply with the mandates of UMTA.
3. The Federal-Aid Highway Act
Although ADAPT raised the issue below, the district court reached its conclusion that Congress has not ordered mainstreaming of the disabled without commenting on section 105(b) of the Federal-Aid Highway Act. We hold what is implicit in the district court’s silence, that the Federal-Aid Highway Act does not speak to whether mainstreaming is required.
Section 105(b) of the Federal-Aid Highway Act, amending section 165(b) of the Federal-Aid Highway Act of 1973, provided that DOT must require that “projects” funded pursuant to particular provisions of the Federal-Aid Highway Act be “planned, designed, constructed, and operated to allow effective utilization by ... handicapped persons.” 23 U.S.C. § 142 note. The “projects” included within the purview of section 165(b) include “construction” of “high occupancy vehicle lanes, highway traffic control devices, bus passenger loading areas and facilities ... and fringe and transportation corridor parking facilities,” the “purchase of buses,” and the “construction, reconstruction, and improvement of fixed rail facilities including ... rolling stock.” 23 U.S.C. § 142(a) (incorporated by reference into 23 U.S.C. § 142 note). DOT acknowledges that this amendment expressed a clear intention of requiring increased accessibility to mass transit. DOT, however, argues persuasively that the amendment did not mandate mainstream accessibility.
With regard to this amendment, the Senate Report stated:
The bill contains a statement of national policy which is similar to that found in Section 16(a) of the Urban Mass Transportation Act of 1964, as amended, and which declares that elderly and handicapped persons have the same right to utilize mass transportation systems as other persons. This amendment goes further than the Urban Mass Transportation Act, however, permitting the Secretary to approve only those programs or projects which comply, to the maximum extent feasible, with the provisions of this subsection.
S.Rep. No. 1111, 93d Cong., 2d Sess. 8 (1974) (emphasis added). The amendment *1195may have been intended to “go[] further than [UMTA],” id., in the sense that it added the enforcement mechanism of requiring DOT to withhold approval where certain new federally-funded facilities, buses and rolling stock were not made accessible, but it continued to emphasize that efforts of accommodation are to be limited by feasibility, and we understand feasibility to include financial, engineering and physical plant considerations.
By its terms, the Federal-Aid Highway Act does not speak to whether a system as a whole must be accessible. The text of the act, see supra at 1194, directs the Secretary to require that projects, including buses, purchased with certain federal funds, be designed and operated to allow effective utilization by the handicapped. It thus arguably requires that certain funds appropriated for projects involving the areas that serve as ingress and egress to transportation be spent on accessible projects and that new buses and rolling stock be accessible. It does not speak to what is required of existing systems. Insofar as a system, whether it is fully accessible, paratransit-oriented, or a combination, gets funds for these new facilities or purchases new buses and rolling stock pursuant to the statutory provisions listed in section 165 of the Federal-Aid Highway Act, that Act may require those new additions to be accessible.8 However, section 165 does not indicate whether existing systems may incorporate paratransit services or provide transportation to the handicapped solely through paratransit. Section 165 thus does not speak to the issue of mainstreaming, but only to new purchases. It therefore does not undermine the Secretary’s interpretation of the transportation acts in Subpart E.9 See infra at 1197-99.
4. The Surface Transportation Assistance Act of 1982
Section 317(c) of STAA, 49 U.S.C.A. App. § 1612(d), was enacted to require a more active federal role in the development and enforcement of substantive standards for serving the handicapped in federally-assisted mass transit programs. The statute gives the Secretary extremely broad discretion to adopt appropriate standards for handicapped services. On its face section 317(c) requires only that the Secretary establish “minimum criteria” for serving the handicapped and does not specify any substantive standard mandating mainline accessibility or otherwise constraining the Secretary’s discretion. See 49 U.S.C.A. App. § 1612(d).
The legislative history of STAA also demonstrates that Congress did not unambiguously mandate mainstreaming. While this history contains some statements supporting mainstreaming, it also contains contrary statements. Senator Cranston, a cosponsor of the provision adding section 317(c), stated that “we are not imposing an enormously costly burden for transit systems or requiring an immediate return to the controversial, tough [mainline accessibility regulations] in place before July of 1981.” 128 Cong.Rec. at 32,643.
Congress was apparently unlikely to approve any effort to compel accessible mainline transit. Senator Cranston stated, when he proposed § 317(c), that
[ultimately and ideally, I believe that transit systems should be fully accessible to handicapped and elderly persons, including those who must use wheelchairs. However, I recognize that it is not now feasible to gain approval of legislation that would provide a full guarantee of eventual accessibility.
*1196128 Cong.Rec. at 30,824. Indeed, the Secretary’s 1979 regulations had set out precisely such a policy and were met with severe criticism in Congress. In 1980, both houses of Congress passed bills that would have compelled the Secretary to abandon the compulsory mainline accessibility policy of the 1979 regulations and required the Secretary to permit a “local option.” See, e.g., S. 2720, 96th Cong., 2d Sess., § 118; 126 Cong.Rec. 32,197-98 (1980). In the course of considering this legislation, several members of Congress expressed a clear preference for local discretion and paratransit alternatives to mainline accessibility.
Senator Exon, for example, stated that “[t]he adoption by the Congress of a local option exemption to section 504 would remedy what I consider the very unfortunate rules and regulations of the Department of Transportation regarding the issue of so-called accessible buses versus special transportation services for the handicapped.” 126 Cong.Rec. 16,696 (1980). Similarly, Senator McClure noted that paratransit alternatives offered a feasible and, in some cases, more effective means of providing services than accessible bus service. 126 Cong.Rec. 16,698-16,700 (1980). While these “local option” bills were not enacted into permanent law, the terms of the Senate provisions were incorporated by reference into DOT’s 1981 appropriations legislation, thereby barring the Secretary from using any funds to compel bus accessibility in fiscal year 1981. See Pub.L. No. 96-400, § 324, 94 Stat. 1699 (1980).
There is nothing in the legislative history that suggests that in enacting section 317(c) of STAA, Congress intended to reverse itself and to foreclose paratransit alternatives to bus accessibility. Indeed, Senator Riegle, a co-sponsor of the provision, suggested that the Secretary could adopt standards governing services that “are not in the form of accessible buses or other equipment serving the general public.” 128 Cong.Rec. 32,642-43. Similarly, Senator Cranston noted that rather than alter federal policy on accessibility, the measure would “still retain[] the philosophy of granting broad discretion to local systems in the design and implementation of their programs.” Id. at 32,644. We conclude that both the statutory language and the legislative history demonstrate that section 317(c) vests the Secretary with the discretion to permit each community to develop paratransit systems or other alternatives to mainline accessibility.
Congress adopted section 317(c) of STAA in 1982 to prod DOT into action following the 1981 remand of the regulations in APTA v. Lewis. Accordingly, DOT was directed to promulgate final regulations establishing minimum criteria for the provision of transportation services to the disabled. DOT, in formulating the regulations before us today, found it reasonable to interpret section 317(c) as not requiring that transportation services for the handicapped be the same as or comparable to that provided the general public. 48 Fed.Reg. 40,685 (1983). The district court, relying on its basic premise that mainstreaming has not been legislated, agreed. So do we.
5. Subpart C
We emphasize that we do not reach the issue whether all new purchases by transit authorities must be of accessible buses. We simply hold that the transportation acts do not mandate mainstreaming, or, in other words, the total revamping of a mass-transit system so that it can accommodate the handicapped in the same facilities and on the same terms as other people. ADAPT at no time requested a declaratory judgment that all new purchases must be accessible. Thus we limit our holding to the validity of Subpart E, which by its terms does not speak to new acquisitions, but rather sets the minimum service criteria by which to judge whether transit systems are fulfilling the mandates of the transportation acts.
Subpart C of the DOT’s regulations provides in relevant part that
Each facility ... constructed by, on behalf of, or for the use of a recipient [of financial aid from DOT] shall be designed, constructed, and operated in a manner so that the facility or part of the *1197facility is accessible to and usable by handicapped persons, if the construction was commenced after the effective date of this part.
49 C.F.R. § 27.67(a). “Facility” is defined to include “all or any portion of buildings, structures, vehicles, equipment, roads, walks, [and] parking lots.” 49 C.F.R. § 27.5.
We do not think it appropriate at this time to address the relationship between Subparts C and E. First, the issue was not adequately presented in the district court. In its reply brief to this Court, ADAPT suggests that upholding Subpart E of the challenged regulations would in effect vitiate Subpart C of the regulations, which requires transit authorities to make newly purchased facilities accessible to the handicapped, and therefore E must be struck down. See ADAPT Rep.Br. at 16. However, ADAPT did not request declaratory relief with respect to Subpart C in its complaint in the district court or even in its initial brief to this court. It requested only that the provisions of Subpart E be struck down. See ADAPT Br. at 26-27 (“This appeal challenges only the validity of sub-part E_”). Similarly, EPVA has never requested declaratory relief with respect to Subpart C.
Moreover, briefing on the relationship between the two subparts has not been significant either in the district court or this Court. And counsel for the Secretary conceded at oral argument that it was a “fair interpretation” to say that the issue of the relationship between the two subparts was not presented to the district court. Although he subsequently stated that this Court should nonetheless address the issue because the relationship was a question of law that was critical to the outcome of the case, as we discuss below, we disagree with that proposition. While acquisition of buses without lifts may be in violation of the transportation acts and Subpart C, it is not a wrong remediable by attack on Subpart E. Subpart E by its terms does not speak of new acquisitions, but rather sets the minimum service criteria by which to judge whether transit systems are fulfilling the mandates of the transportation acts.
Second, the issue was not addressed below. “It is the general rule that a federal appellate court does not consider an issue not passed upon below. This rule is one of discretion rather than jurisdiction, and in the past we have heard issues not raised in the district court when prompted by exceptional circumstances.” See Selected Risks Insurance Co. v. Bruno, 718 F.2d 67, 69 (3d Cir.1983) (citations omitted). We find no exceptional circumstances in this case justifying a departure from the general rule.
Third, we do not believe that the issue is ripe for review. Judge Mansmann, in dissent, argues that, in order to give the statutes their full force, Subpart C must be read to require that all new buses are accessible, and concludes that because there is a potential conflict between Sub-part C and the part of Subpart E that allows paratransit only, Subpart E must fall. See post at 1214. However, we believe that it is clearly possible to read the two provisions as independent and consistent requirements. If a municipality purchases no new buses, it would be perfectly permissible under both Subparts for none of the city’s buses to be accessible and for the city to rely only on paratransit. See ADAPT Br. at 28 (“Of course, if a transit system chooses not to purchase any new buses, it need not comply with anything in subpart C, and in that event need only comply with the service requirements of subpart E.”).
It is also not clear that the Secretary will interpret the regulations so as to cause a conflict since it is not clear that the Secretary will allow municipalities to evade the facial mandate of Subpart C on the grounds that they are in compliance with the paratransit only option of Subpart E. In its brief to this Court, the Secretary does take the position that the regulations taken as a whole “did not intend to mandate acquisition of accessible buses.” Secretary’s Br. at 28. At oral argument on the appeal, the Secretary’s counsel, when questioned on the point, contended that compliance with Subpart E excuses compli-*1198anee with Subpart C. But the fact that the Secretary has taken a litigation position on the matter does not make it ripe for review. See FTC v. Standard Oil Co. of California, 449 U.S. 232, 241-42, 101 S.Ct. 488, 493-94, 66 L.Ed.2d 416 (1980) (agency filing of complaint before administrative law judge not final action and not judicially reviewable because it is not a definitive statement of the agency’s position); cf. Bowen v. Georgetown University Hospital, — U.S. -, 109 S.Ct. 468, 473, 102 L.Ed.2d 493 (1988) (“ ‘Congress has delegated to the administrative official and not to appellate counsel the responsibility for elaborating and enforcing statutory commands.’ ” (citation omitted)). ADAPT does not contend that the agency has made it clear, either through a rule-making or by approving mass transportation plans that comply with Subpart E but not with Sub-part C, that the agency’s final position is that Subpart E trumps Subpart C.10
This Court has held that when there is no facial inconsistency between a regulation and a statute there is “no need to anticipate” that the regulation will be applied inconsistently with the statute. In such a case, the regulation is not ripe for judicial review. See Westinghouse Electric Corp. v. NRC, 555 F.2d 82, 92 (3d Cir.1977). That is the situation here. We see no reason to anticipate that the Secretary will apply Subpart E in a way that would undermine Subpart C.
6. Summary
As the preceding examination of the relevant statutes demonstrates, neither in the express language nor in the legislative history of these statutes has Congress expressly mandated mainstreaming or indicated an intention to do so. Instead, the statutes delegate broad powers to the Secretary to promulgate regulations detailing minimum criteria for handicapped services that balance the goals of preserving local discretion, avoiding the imposition of unduly burdensome costs, and ensuring adequate transportation services for the handicapped. The regulations must be upheld if the balance they strike represents a permissible reading of the statutes, even if the court would have struck a different balance in the absence of the regulations. See Chevron, 467 U.S. at 843 n. 11, 104 S.Ct. at 2782 n. 11. To this inquiry we now turn.
B. Are The Local Option Provisions Arbitrary and Capricious?
The district court found that the Secretary’s decision to allow communities the option of providing alternatives to accessible bus service is adequately supported by record evidence of the relative costs and benefits. See ADAPT, 676 *1199F.Supp. at 640-41. Much of this evidence is derived from the Secretary’s Regulatory Impact Analysis (“RIA”). See 51 Fed.Reg. 18,994. The RIA evaluated the costs and benefits of various service options and was based on two research methods. One method compiled detailed case studies of seven cities selected as representative of the array of possible modes of providing transportation services to the handicapped. See RIA at v-vi. A second method constructed a computer model designed to predict the relative costs of paratransit systems providing a range of alternate levels of service. See RIA at IV-1 to IV-18.
The RIA indicated that special services for handicapped persons were likely to be more cost-effective than accessible bus service. Specifically, the Secretary concluded that specialized services would generate more handicapped rides per dollar expended, thereby resulting in lower costs per trip. See RIA at VI-9. This conclusion was reflected in data from both the actual case studies and a computer model. The case studies, for example, indicated that:
[L]ift-bus service does not appear to be a particularly cost effective way of meeting the transportation needs of large numbers of disabled persons.... To date, the Seattle Metro bus system has attained the highest lift use rate of any large lift-bus system.... Based on the adjusted cost of the Seattle service, the estimated costs per trip is $16.90. In comparison, the paratransit systems in Cleveland and Pittsburgh are more cost-effective (with cost per trip of $12.06 and $11.95), and serve roughly four times the number of disabled trips as Seattle’s lift-buses.
RIA at III — 6.
The computer model produced similar predictions of greater cost effectiveness for specialized services:
At a discounted cost-per-trip of $25.00 ... lift-equipped buses are clearly less cost-effective than paratransit services ($11.56 per trip) and are estimated to serve considerably fewer persons as well.
RIA at VI-9 to VI-10.11
The higher ridership rates for paratran-sit services suggest that a system providing only accessible bus service may not fully and adequately serve the handicapped community. Indeed, the Secretary took note of comments in the rulemaking record indicating that
not all handicapped persons could use accessible bus service, for reasons such as distance from bus stops, inability to use a lift, physical barriers between the bus stop and the user’s origin or destination, bad weather, etc.
51 Fed.Reg. at 19,009.
Given our narrow scope of review, and the Secretary’s conclusion that local discretion in providing handicapped services is essential, 51 Fed.Reg. at 19,004, evidence showing that the paratransit systems already operated by many communities could offer more cost-effective service, while providing advantages that cannot be provided by accessible bus service alone, provides sufficient support for DOT’s decision to permit such alternatives. We conclude therefore that the district court correctly held that the provisions permitting para-transit alternatives are a rational exercise of the Secretary’s discretion pursuant to the STAA’s command to issue minimum criteria.
We admit to some discomfort with our conclusion, because ADAPT has forcefully argued that a system that is wholly para-transit results in rather serious restrictions on spontaneous travel for the disabled. The regulations provide for 24-hour response time for paratransit services. See 49 C.F.R. § 27.95(b)(2). Therefore, the disabled may have great difficulty in attending social events or getting to work on short notice where the system is not fully accessible. Despite our unease in the face of these difficulties, neither the language nor the legislative history of any of the *1200acts at issue here justifies a conclusion that DOT has acted arbitrarily and capriciously in promulgating the local option provision. Under current administrative law doctrine, we “need not conclude that the agency construction was the only one it permissibly could have adopted to uphold the construction, or even the reading [we] would have reached if the question initially had arisen in a judicial proceeding.” Chevron, 467 U.S. at 843 n. 11, 104 S.Ct. at 2782 n. 11. The accommodation of the transit needs of the disabled can only come from Congress or the Secretary.
IV. VALIDITY OF THE THREE-PERCENT SAFE HARBOR PROVISION12
There is no doubt that, in establishing the minimum service criteria required by section 317(c), Congress gave the Secretary the discretion to take compliance costs into account. None of the statutes governing the Secretary’s responsibility to ensure that federally assisted transit programs serve the handicapped contains any language that would preclude the Secretary from considering costs. With respect to section 504, as APTA v. Lewis, 655 F.2d at 1278, makes clear, standards that would impose unreasonable cost burdens on local transit operators would exceed the Secretary’s authority.13
The Secretary concluded that a limit on required expenditures was necessary to avoid imposing unduly burdensome modifications and to preserve a community’s discretion to choose service options carrying higher overall compliance costs. 51 Fed. Reg. at 18,998-99, 19,011. The district court held that consideration of compliance costs is within the Secretary’s discretion. 676 F.Supp. at 641. The current 3% safe harbor provision is not the first safe harbor provision implemented by DOT. In 1976, the regulations established a 5% safe harbor which was decreased to 2% in 1979 and then raised to 3.5% in 1981. See Rhode Island Handicapped Action Committee, 718 F.2d at 497 n. 10.
While upholding the local option provision of Subpart E and the minimum service criteria contained therein, the district court struck down the 3% safe harbor provision as arbitrary and capricious and in violation of section 317(c) of STAA. However, the district court decided not to redact the regulations (to delete the portions it found to be arbitrary) or to rewrite them. Unable to conclude that DOT would have adopted the same service criteria absent the 3% provision, the district court remanded the regulations to DOT for “proceedings consistent with its decision.”
In its cross-appeal, DOT contends that the 3% safe harbor provision of Subpart E *1201is an integral part of the minimum standards developed and that the standards themselves would be impaired necessarily if a cost limit were not applied. DOT also takes the position that the Supreme Court’s decisions in Davis and Choate require the safe harbor so that undue financial burdens not be imposed on mass transit agencies. DOT bases its interpretation of the holdings of Davis and Choate essentially on its contention that the statutes governing its responsibility to ensure that the federally-assisted programs serve the disabled do not include language which precludes DOT from taking the cost of accommodation into consideration.
A regulation is arbitrary and capricious when the agency fails to “articulate a satisfactory explanation for its action, including a ‘rational connection between the facts found and the choice made.’ ” Motor Vehicle Manufacturers Association v. State Farm Mutual Automobile Insurance Co., 463 U.S. 29, 43, 103 S.Ct. 2856, 2866, 77 L.Ed.2d 443 (1983) (quoting Burlington Truck Lines v. United States, 371 U.S. 156, 168, 83 S.Ct. 239, 246, 9 L.Ed.2d 207 (1962)). “Normally, an agency rule would be arbitrary and capricious if the agency ... entirely failed to consider an important aspect of the problem, offered an explanation for its decision that runs counter to the evidence before the agency, or is so implausible that it could not be ascribed to a difference in view or the product of agency expertise.” 463 U.S. at 43, 103 S.Ct. at 2867.
The district court acknowledged DOT’s intended application of the safe harbor provision, which DOT expressed as follows:
If the recipient cannot meet the six criteria for the type of service it chooses without exceeding this limit on required expenditures, the recipient may modify its service to keep its expenditures within the limit, after consultation through its public participation process.
51 Fed.Reg. at 18,994.14 However, according to DOT, if the 3% safe harbor were implemented, cities of less than one million people in which the transit authorities implemented a paratransit-only system would virtually never meet all of the applicable service criteria. See 51 Fed.Reg. at 19,012 (paratransit-only service “could be provided for less than the cost limit amounts only in cities of more than 1,000,000 population”).
The district court explained:
§ 317(c) requires the Secretary to establish minimum service criteria for the provision of transportation services to the handicapped, yet the 3% safe harbor cost limitation allows DOT grantees to undercut the Congressional intent of § 317(c) by avoiding compliance with some or all of the service criteria simply by spending a certain percentage of their funds.
676 F.Supp. at 641. In effect, under the safe harbor provision, cities could deny to the disabled the minimum quality of service mandated by the Congress with impunity. The Secretary’s claim that the 3% safe harbor provision adequately ensures minimum compliance with the transportation statutes therefore runs counter to the evidence before the agency at least with respect to cities of populations below 1,000,000. Immunization from compliance for an entire class of cities was not contemplated by Congress. Therefore, we must conclude that the 3% safe harbor provision is arbitrary and capricious.
Judge Greenberg’s dissenting opinion concedes that there will be cases in which cities would not meet the minimum service criteria if they failed to spend more than the 3% safe harbor figure on attempting to comply with the criteria. See, e.g., post at *12021223-24. Relying on our opinion in Westinghouse Electric Corp. v. NRC, 555 F.2d 82 (3d Cir.1977), however, Judge Greenberg states that such a concern is irrelevant because the instant case involves only a facial challenge to the regulations. See post at 1225-26. In Westinghouse, we held that an NRC regulation concerning the protection of proprietary information was not facially invalid because it was unclear how the rule would be applied in practice and under one possible application the rule would be consonant with the underlying statute. See 555 F.2d at 92. The principle of Westinghouse, that a regulation is not facially invalid when it is unclear if the regulation as applied in practice would violate the underlying statute, is an important one, but it is not relevant to the 3% safe harbor provision at issue in this case.
The regulation at issue in the instant case, 49 C.F.R. § 27.97(b), on its face, admits of no uncertainty in application. The regulation states (with clearly delineated exceptions) that a recipient is not required to spend more than the 3% figure. See 49 C.F.R. § 27.97(b) (“A recipient is not required, in any fiscal year, to spend more than the amount of its [3%] limit on required expenditures for that fiscal year in order to comply with this subpart, even if, as a result, the recipient cannot provide service to handicapped persons that fully meets” certain of the service criteria.). Where there is no uncertainty as to how a regulation will be applied, judicial invalidation of a regulation not supported by the administrative record need not wait until the actual application of the regulation. See EPA v. National Crushed Stone Assoc., 449 U.S. 64, 72 n. 12, 101 S.Ct. 295, 301 n. 12, 66 L.Ed.2d 268 (1980) (holding that pre-enforcement review of EPA regulation’s validity was not premature since EPA had made clear its final position on how the regulation would be applied).
Judge Greenberg relies heavily on 49 C.F.R. § 27.85 to buttress his position that the 3% safe harbor is not facially invalid. See post at 1224-25, 1226-27. That section grants the Secretary discretion to decline to approve a transit operator’s proposed service program. Judge Greenberg argues that the Secretary might never approve a program that failed to extend to mobility impaired individuals the level of service that Congress has required and that Subpart E, as a consequence, cannot be facially invalid. See post at 1226.
The problem with this argument is that section 317(c) of the STAA expressly requires DOT to promulgate “not later than [180] days after January 6, 1983 ... final regulations ... establishing ... minimum criteria for the provision of transportation services to handicapped and elderly individuals by recipients of” certain federal funds. 49 U.S.C.A.App. § 1612(d). STAA obligates DOT to promulgate a rule that establishes minimum service criteria; a safe harbor provision permits transit operators to comply with Subpart E without meeting DOT’s criteria. With respect to the transit operators that take advantage of the 3% safe harbor, the only service criteria that Subpart E establishes is the eligibility standard (that all persons who are physically handicapped and unable to use the recipient’s bus service shall be eligible to use the recipient’s special service). See post at 1224; 49 C.F.R. § 27.97(b).
We believe that with respect to these transit operators (those that take advantage of the 3% safe harbor), DOT will not have complied with the STAA’s mandate that it promulgate a regulation establishing minimum service criteria. As the instant case demonstrates, a section that permits the Secretary, on a case by case basis, to evaluate whether a proposed service program “den[ies] mobility impaired individuals the level of service that Congress has required,” post at 1226, does not, in our view, comply with the STAA’s mandate to “promulgate final regulations ... establishing ... minimum [service] criteria.” 49 U.S.C.A.App. § 1612(d). In the instant case, the 3% safe harbor runs afoul of this evil because, as discussed supra at 1201-02, the administrative record indicates that a significant number of transit operators that rely on the 3% safe harbor will not meet the minimum service criteria. Congress mandated a rule establishing *1203minimum service criteria rather than a rule that, in a significant number of cases, leaves it to the Secretary to decide on a case by case basis whether a transit operator’s service program is sufficient.15 Consequently, we believe that Judge Green-berg’s reliance on 49 C.F.R. § 27.85 to save Subpart E from facial invalidation is misplaced.
We agree with the district court that it is not apparent whether DOT would have issued the identical minimum criteria to implement UMTA, the Federal-Aid Highway Act and the Rehabilitation Act without the 3% safe harbor provision. See ADAPT, 676 F.Supp. at 643 (“I cannot say that the defendant would have adopted the rest of the regulations in their present form, if the arbitrary portions were subtracted, particularly since compliance costs are a legitimate factor for agency consideration.”). Therefore, while we will affirm the grant of summary judgment to the plaintiffs, we will remand the case to the district court with instructions that it remand to DOT for further rulemaking consistent with this opinion.
EPVA requests that DOT be given a specific timetable in which to formulate conforming regulations. In light of the lengthy delay in implementation of STAA that has already occurred — more than six years have passed since the regulations were supposed to be promulgated — this is a meritorious request. We do not believe, however, that we stand in the best position to determine the most appropriate time frame; rather we will remand to the district court for determination, after consultation with the parties, of an expeditious timetable for promulgation of regulations in conformity with this opinion.
V. CONCLUSION
For the foregoing reasons, the district court’s grant of summary judgment to the Secretary on Subpart E’s local option provision will be affirmed. Additionally, the district court’s grant of summary judgment for the plaintiffs on the safe harbor issue will be affirmed, and the case remanded to the district court for determination, after consultation with the parties, of an expeditious timetable for promulgation of regulations in conformity with this opinion.
All members of the Court join in parts I and II of this opinion.
GIBBONS, Chief Judge, and COWEN and NYGAARD, Circuit Judges, join in part III of this opinion in its entirety.
SEITZ, STAPLETON, GREENBERG, and HUTCHINSON, Circuit Judges, join in parts III-A-1, III-A-2, III-A-4, III-A-6, and III-B of this opinion.
GIBBONS, Chief Judge, and SEITZ, A. LEON HIGGINBOTHAM, Jr., SLOYITER, MANSMANN, SCIRICA, COWEN, and NYGAARD, Circuit Judges, join in part IV of this opinion.
. By "paratransit," we describe those transportation services, usually performed by wheelchair-accessible vans, that are provided to the handicapped separate from the mass transit's normal operations. DOT refers to paratransit in its regulations as "special service systems." See 49 C.F.R. § 27.95(b) (1987). In general, paratran-sit is transportation that is provided upon request by the handicapped individual.
. An action similar to ADAPT’s, filed by the Eastern Paralyzed Veterans Association (“EPVA”), was consolidated with ADAPT’s and is before us as well. EPVA’s complaint challenged the imposition of the safe harbor provision to excuse noncompliance with the minimum service criteria, alleging that the 3% figure was selected in an arbitrary and capricious manner. On appeal, No. 88-1178, EPVA contends that the district court, after voiding the 3% provision, erred in remanding to DOT the regulations outlining the minimum service criteria. EPVA maintains that in the event the remand was appropriate, the district court should have set a timetable for promulgation of the final regulations. We address these issues infra.
. In presenting the bill, Senator Humphrey announced that ”[t]he time has come when we can no longer tolerate the invisibility of the handicapped in America.” 118 Cong.Rec. 525 (1972).
. The Act directs the Secretary to publish and promulgate regulations
not later than ninety days after January 6, 1983 ... establishing (1) minimum criteria for the provision of transportation services to handicapped and elderly individuals by recipients of Federal financial assistance ... and (2) procedures for the Secretary to monitor recipients’ compliance with such criteria.
49 U.S.C.A.App. § 1612(d).
. The district court also found arbitrary and capricious the Secretary’s decision to permit local transit operators to include within the amount of money encompassed by the 3% limitation the costs incurred in offering half-fare discounts to the elderly and the handicapped during off-peak hours. See 676 F.Supp. at 642-43. In contrast, the court found reasonable the regulations that the transit operator be required to meet the minimum service criteria and thus provide transportation services to the handicapped at full performance level as soon as reasonably feasible but in any case within six years of the initial determination of DOT’S approval of its program. 49 C.F.R. § 27.95(a). See 676 F.Supp. at 643. The government has not appealed that aspect of the district court’s decision striking down the inclusion of the half-fare program within the safe harbor funds and neither ADAPT nor EPVA challenges the reasonableness of the six-year phase-in.
. Summary judgment will be granted if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. On review the appellate court is required to apply the same test the district court should have used initially. Goodman v. Mead Johnson and Co., 534 F.2d 566, 573 (3d Cir.1976), cert. denied, 429 U.S. 1038, 97 S.Ct. 732, 50 L.Ed.2d 748 (1977). In determining the applicable law, we must examine the district court’s interpretation of the DOT regulations. This is a question of law subject to plenary review. Disabled in Action of Pennsylvania v. Sykes, 833 F.2d 1113, 1116 (3d Cir.1987), cert. denied, — U.S. -, 108 S.Ct. 1293, 99 L.Ed.2d 503 (1988).
. With respect to § 16(a) of UMTA, its sponsor, Rep. Biaggi, stated that the amendment was intended to "grant[ ] equal rights [to the disabled and elderly] to use public facilities with the same ease as everyone else." 116 Cong.Rec. 34,180, 34,181 (1970). He also apparently rejected paratransit-only programs when he stated that "they would further serve to segregate the elderly and the handicapped from our society.” Id. Taken alone, these statements might lead us to conclude that mainstreaming was mandated. However, the language of UMTA, which only requires "special efforts," see infra at 1193-94, militates against this view.
. In fact, Subpart C of DOT’S regulations, which is not before us, see infra at 1196-98, on its face apparently requires that all newly built facilities and newly purchased buses be accessible. See 49 C.F.R. 27.67(a) (1987).
. This conclusion is consistent with Rep. Biag-gi’s comments on § 105, the amendment to § 165. Rep. Biaggi, in commenting on § 105, stated that § 16(a) of UMTA "sought to require [that] the design and construction of all new mass transit systems, equipment, and facilities be totally accessible to the elderly and the handicapped.” 120 Cong.Rec. 19,851 (1974). This statement does not suggest that § 165 mandates retrofitting, which would be the central requirement if immediate mainstreaming were required.
. We disagree with Judge Greenberg’s contention in dissent that when Secretary Dole promulgated Subpart E, she explained that compliance with Subpart E would excuse compliance with Subpart C. See post at 1219 & n. 4. As we read the two citations that he provides, they do not support that contention.
At 51 Fed.Reg. at 19,004, Secretary Dole merely takes the position that it is not mandatory for a city to provide a system of accessible bus service, especially in light of the high costs of retrofitting. The Secretary justifies the decision not to require a system of accessible bus service in part because "[i]n the Department’s experience, this approach was not successful. The high cost of making old rail systems accessible was one of the most important factors leading the Court of Appeals in the APTA case to declare that the 1979 rule imposed undue burdens.” 51 Fed.Reg. at 19,004. This says nothing about whether, if a municipality is operating an adequate paratransit system, it is excused from any requirement that the new buses that it purchases be accessible.
At 51 Fed.Reg. at 18,998, Secretary Dole states that “ '[e]ven if a recipient chooses to comply [with Subpart E] through bus accessibility, every new bus need' not be accessible to wheelchair users. Only those buses needed to meet service criteria must be accessible.”’ Post at 1219 (quoting 51 Fed.Reg. at 18,998) (brackets added by dissenting opinion). These sentences, as we read them, merely state that municipalities electing the accessible bus service option of Subpart E need not make every new bus accessible in order to comply with the minimum service criteria of Subpart E. They do not state that compliance with Subpart E excuses a municipality from complying with Subpart C; rather, they state only that Subpart E does not independently require that municipalities purchase only accessible buses. Although these sentences are not wholly unambiguous, we cannot conclude based on these two sentences, buried in a lengthy release, that Secretary Dole "explained that compliance with Subpart E of the regulations did excuse compliance with Sub-part C." Post at 1219.
. The conclusion that paratransit services attract greater numbers of handicapped riders is also supported by independent research. As the Secretary noted in the rulemaking record, the RIA figures on comparative ridership are consistent with a survey conducted for the National Cooperative Highway Research Program. See RIA at VI-7.
. We use the term "safe harbor” because the 3% figure refers to the minimum level of spending which the Secretary will deem to constitute compliance with the UMTA and section 504. The regulations have previously provided a series of alternative safe harbor provisions. See Rhode Island Handicapped Action Committee v. Rhode Island Public Transit Authority, 718 F.2d 490, 493-94 & nn. 5 & 6 (reviewing the three safe harbor provisions of the 1981 regulations); Disabled in Action of Baltimore v. Bridwell, 593 F.Supp. 1241, 1246-47 (D.Md.1984) (same). Only the 1979 regulations as interpreted in APTA v. Lewis, 655 F.2d 1272, did not provide such safe harbors, and these regulations were invalidated by the D.C. Circuit as exceeding the authority granted by § 504. 655 F.2d at 1280.
Many transit authorities apparently spend in excess of the specified minimum percentage. See, e.g., Rhode Island Handicapped Action Committee, 718 F.2d at 494 n. 7 (finding that the local transit authority spent 46% of the applicable funds for services for the elderly and handicapped when the regulations then in effect established a 3.5 percent safe harbor). Disabled in Action of Baltimore, 593 F.Supp. at 1247 (finding that the local transit authority spent 3.9, 4.4, 5.7, 6.4, and 9.3 percent of the applicable funds from 1979 to 1983, respectively, on its paratransit program in addition to expenditures for taxi subsidies and mainline accessibility when the regulations then in effect established a safe harbor that varied between 2 and 3.5 percent); Vanko v. Finley, 440 F.Supp. 656, 668 (N.D.Ohio 1977) (finding that the local transit authority’s spending on services for the mobility-impaired "greatly surpasses” the regulatory safe harbor); 51 Fed.Reg. at 19,013 (four of seven RIA case study cities spend more than proposed safe harbors).
. Arguably, UMTA, STAA, or the Federal-Aid Highway Act could require more than § 504, but we find neither language nor legislative history that would indicate that those acts would mandate or permit the imposition of extraordinary expenditures to satisfy the mandates of those acts.
. There is language in the Final Rule that would indicate that the service criteria cannot be undercut by the safe harbor provision. See 51 Fed.Reg. at 19,010 ("The preamble discussion of this proposed section stated that the accessible bus and special service components of the mixed system, taken together, would have to meet all the service criteria.”). However, DOT eliminated the force of this statement when it stated that “[t]he full performance level for a mixed system is reached when, subject to the overall limit on required expenditures, each component of that system meets the service criteria_” Id. at 19,011 (emphasis added). Therefore, there can be no question that the 3% safe harbor provision places a limit on the requirements set forth in the minimum service criteria.
. Because we hold that this particular safe harbor is arbitrary and capricious, we do not reach the issue whether some other safe harbor provision would be permitted by the STAA.