Project Management Oversight

 
CONTENT
Federal Register, Volume 84 Issue 165 (Monday, August 26, 2019)
[Federal Register Volume 84, Number 165 (Monday, August 26, 2019)]
[Proposed Rules]
[Pages 44590-44596]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-18286]
[[Page 44590]]
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DEPARTMENT OF TRANSPORTATION
Federal Transit Administration
49 CFR Part 633
[Docket No. FTA-2019-0016]
RIN 2132-AB35
Project Management Oversight
AGENCY: Federal Transit Administration (FTA), DOT.
ACTION: Notice of proposed rulemaking (NPRM); request for comments.
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SUMMARY: The Federal Transit Administration proposes to amend its
project management oversight rule to make it consistent with recent
statutory changes and to modify the scope and applicability of the
rule. FTA seeks comments from project sponsors, the transit industry,
other stakeholders, and the public on the proposed changes to the rule.
DATES: Comments must be received October 25, 2019. Any comments filed
after this deadline will be considered to the extent practicable.
ADDRESSES: You may submit comments, identified by the docket number at
the top of this document, by any of the following methods:
     Federal eRulemaking Portal: Go to http://www.regulations.gov and follow the instructions for submitting
comments.
     Mail: Docket Management Facility, U.S. Department of
Transportation, 1200 New Jersey Ave. SE, West Building Ground Floor,
Room W12-140, Washington, DC 20590-0001.
     Hand Delivery or Courier: West Building Ground Floor, Room
W12-140, 1200 New Jersey Ave. SE, between 9:00 a.m. and 5:00 p.m.
Eastern time, Monday through Friday, except Federal holidays.
     Fax: (202) 493-2251.
    Instructions: All submissions received must include the agency name
and docket number or Regulatory Information Number (RIN) for this
rulemaking. All comments received will be posted without change to
www.regulations.gov, including any personal information provided. You
may review the U.S. Department of Transportation's (DOT) complete
Privacy Act Statement in the Federal Register published on April 11,
2000 (65 FR 19477).
    Docket: For access to the docket to read background documents or
comments received, go to www.regulations.gov at any time or to the U.S.
Department of Transportation, 1200 New Jersey Ave. SE, Docket
Operations, M-30, West Building Ground Floor, Room W12-140, between
9:00 a.m. and 5:00 p.m. Eastern time, Monday through Friday, except
Federal holidays.
FOR FURTHER INFORMATION CONTACT: For program matters, Corey Walker,
Office of Program Management, (202) 366-0826 or [email protected].
For legal matters, Mark Montgomery, Office of Chief Counsel, (202) 366-
4011 or [email protected].
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Background
II. Section-by-Section Analysis
III. Regulatory Analyses and Notices
I. Background
    Recognizing a compelling need to strengthen the management and
oversight of major capital projects, in the Surface Transportation and
Uniform Relocation Assistance Act of 1987 (STURAA) (Pub. L. 100-17)
(April 2, 1987), Congress authorized FTA's predecessor agency, the
Urban Mass Transportation Administration (UMTA), to conduct oversight
of major capital projects and to promulgate a rule for that purpose.
The statute, now codified at 49 U.S.C. 5327, authorizes FTA to obtain
the services of project management oversight contractors (PMOCs) to
assist FTA in overseeing the expenditure of Federal financial
assistance for major capital projects. Further, the statute requires
FTA to promulgate a regulation that includes a definition of ``major
capital project'' to identify the types of projects governed by the
rule.
    Accordingly, UMTA promulgated a rule for oversight of major capital
projects on September 1, 1989, at 49 CFR part 633 (54 FR 36708). At
that time, UMTA's capital programs were comparatively small, relative
to today, totaling a little more than $2 billion annually. UMTA
promulgated a regulation that defined ``major capital project'' as any
project for the construction of a new fixed guideway or extension of an
existing fixed guideway or a project involving the rehabilitation or
modernization of an existing fixed guideway with a total project cost
of $100 million or more. The rule limited covered projects to those
receiving funds made available under sections 3, 9, or 18 of the
Federal Mass Transit Act of 1964, as amended, 23 U.S.C. 103(e)(4), or
section 14(b) of the National Capital Transportation Amendments of
1979. That rule is still in effect today.
    By 2011, however, the annual dollar value of the Federal transit
capital programs was nearly five times the level authorized under
STURAA in 1987, and the number of active PMOC task orders was more than
double the number in 1987. Furthermore, FTA funded a larger number of
projects with a total cost of over one billion dollars that presented
significant oversight challenges. Thus, on September 13, 2011, FTA
published a Notice of Proposed Rulemaking (NPRM) (76 FR 56378) that
proposed to enable FTA to identify more clearly the necessary
management capacity and capability of a sponsor of a major capital
project; spell out the many facets of project management that must be
addressed in a project management plan; tailor the level of FTA
oversight to the costs, complexities, and risks of a major capital
project; set forth the means and objectives of risk assessments for
major capital projects; and articulate the roles and responsibilities
of FTA's PMOCs.
    After the NPRM was published, however, the Moving Ahead for
Progress in the 21st Century Act (MAP-21) (Pub. L. 112-141) (July 6,
2012) repealed the Fixed Guideway Modernization program, created the
State of Good Repair program, and amended the Capital Investment Grants
Program to add Core Capacity Improvement projects and streamline the
New and Small Starts project development process. Moreover, MAP-21
shifted the initiation of project management oversight to the project
development phase and removed the statutory requirement that recipients
of financial assistance for projects with a total cost of $1 billion
submit an annual financial plan. Given the fundamental changes to these
competitive and formula capital programs, FTA withdrew the NPRM (78 FR
16460) to reexamine its proposed definition of major capital projects
and its policy and procedures for risk assessment. Subsequently, the
Fixing America's Surface Transportation (FAST) Act (Pub. L. 114-94)
(December 4, 2015) further amended section 5327 to limit project
management oversight to quarterly reviews, absent a finding that more
frequent oversight was necessary, and mandated that the Secretary
prescribe regulations outlining a process for at-risk recipients to
return to quarterly reviews.
    FTA has become much more knowledgeable about the risks inherent in
major capital projects, having conducted its own risk assessments since
2005, witnessed some project sponsors' lack of management capacity and
capability and appropriate project controls for some projects, and
studied the reasons for cost and schedule changes on many major capital
projects.
[[Page 44591]]
Consequently, FTA now proposes to amend its project management
oversight rule.
    First, this proposed rule would change the applicability of the
regulation by shifting the definition of a ``major capital project''
from one based on the type of project or total project cost to one
based on both the amount of Federal financial assistance and the total
project cost, which FTA views as a more appropriate benchmark than the
type of project or total capital cost of a project alone. The current
definition of a ``major capital project'' under 49 CFR 633.5 applies to
all construction projects for new fixed guideways or extensions of
existing fixed guideways, regardless of project cost, and to fixed
guideway rehabilitation and modernization projects with total project
costs over $100 million. The NPRM applies a project cost threshold to
all fixed guideway capital projects. As a default, the proposed rule
raises the total project cost threshold to $300 million or more and
requires that the project receive $100 million or more in Federal
investment to be subject to project management oversight. Under this
default, the number of current projects undergoing project management
oversight would decrease by forty-nine, out of a total of eighty-eight
major capital projects under construction, allowing FTA to focus on
higher-risk projects.
    Second, as described in more detail below, the NPRM amends the
regulation to bring it into compliance with recent statutory changes.
The proposed rule limits project management oversight to quarterly
reviews, absent a finding by FTA that a recipient requires more
frequent oversight, and provides a process for such a recipient to
return to quarterly reviews. Additionally, the rule applies project
management oversight to major capital projects receiving Federal
financial assistance under any provision of Federal law. The proposed
changes would have no impact on safety.
II. Summary of Provisions
Section 633.1 Purpose
    This section proposes an update to reflect the mandate in 49 U.S.C.
5327(a) to perform program management oversight of major capital
projects for public transportation under Chapter 53 of Title 49, United
States Code, or any other provision of Federal law.
Section 633.3 Scope
    This section proposes an update to reflect the mandate in 49 U.S.C.
5327(a) that the regulation applies to recipients of Federal financial
assistance undertaking a major capital project for public
transportation under Chapter 53 of Title 49, United States Code, or any
other provision of Federal Law.
Section 633.5 Definitions
    This section sets forth the definitions of some key terms
applicable to this rule. FTA proposes to establish a definition for
``project development'' and remove the definitions for ``full funding
agreement'' and ``FT Act.'' Also, FTA proposes to amend the current
definitions for ``fixed guideway,'' ``major capital project,''
``project management oversight,'' and ``recipient.''
    The current definition of a ``major capital project'' under 49 CFR
633.5 applies to all construction projects for new fixed guideways or
extensions of existing fixed guideways, regardless of project cost, and
to rehabilitation and modernization projects with total project costs
over $100 million. In this rule, FTA proposes to define a ``major
capital project'' generally as a project to construct, expand,
rehabilitate, or modernize a fixed guideway of $300 million or more
that receives $100 million or more in Federal financial assistance. FTA
believes it is more appropriate to apply the regulation to any given
project based on the level of Federal investment in addition to total
project cost, as opposed to the type of project or the total project
cost alone. FTA further proposes that a project that does not meet the
dollar-amount thresholds for the level of Federal investment and total
project cost may be deemed a ``major capital project'' under certain
circumstances.
    This section would amend the definition of ``fixed guideway'' to
add passenger ferries as a qualifying public transportation facility,
to reflect amendments made by MAP-21 to the definition of ``fixed
guideway'' under 49 U.S.C. 5302(7). FTA proposes to add a definition
for ``project development'' to correspond with the MAP-21 requirement
that oversight begins in this phase, as reflected in 49 U.S.C.
5327(d)(2)(A). The proposed changes to the remaining definitions,
``project management oversight'' and ``recipient,'' are simply for
clarity.
Section 633.11 Covered Projects
    This section would amend the current rule by omitting obsolete
legal citations and extending the regulation to all major capital
projects funded from any source under 49 U.S.C. Chapter 53 or any other
Federal Law, as required under 49 U.S.C. 5327(a).
Section 633.13 Initiation of Project Management Oversight Services
    This section would make amendments for clarity and consistency with
recent statutory changes. Per 49 U.S.C. 5327(d)(2)(A), project
management oversight now begins during the project development phase
unless the Secretary determines that it is more appropriate to begin
the oversight during another phase of the project to maximize the
transportation benefits and cost savings.
Section 633.15 Access to Information
    This section would make amendments for clarity.
Section 633.17 Project Management Oversight Contractor Eligibility
    This section would make amendments for clarity.
Section 633.19 Exclusion From the Project Management Oversight Program
    FTA proposes revising this section as it is no longer necessary to
identify the administrative funding source (now in 49 U.S.C. 5338) for
FTA to conduct project management oversight. Instead, this section
would provide for an exclusion from the definition of ``major capital
project'' for projects for which the Administrator determines that
project management oversight would not benefit the Federal government
or the recipient.
Section 633.21 Basic Requirement
    This section would make amendments for clarity and to reflect that
oversight now begins during the project development phase of the
project, as required under 49 U.S.C. 5327(a).
Section 633.23 FTA Review of a Project Management Plan
    This section would make amendments for clarity.
Section 633.25 Contents of a Project Management Plan
    The project management plan is critical to successful management of
any major capital project, throughout the development and
implementation of that project. The project management plan and its sub
plans further enable the sponsor's staff to effectively manage the
scope, budget, schedule, and quality of the project through a set of
common objectives, while managing the safety and security of the
public. This section would provide a summary to clarify that a project
management plan is not one-size-fits-all, but rather is based on the
complexity of the project. Further, as required under 49 U.S.C.
5327(a), FTA
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proposes adding three additional minimum elements to the plan: Periodic
updates of the plan, the recipient's commitment to submit a quarterly
project budget and schedule, and safety and security management.
Additionally, based on industry best practice, FTA proposes adding the
management of risks, contingencies, and insurance as an element of the
plan.
Section 633.27 Implementation of a Project Management Plan
    FTA's review and approval of a project management plan seeks to
verify that a sponsor has all the relevant capabilities and resources
in place to ensure successful management of the project using available
best practices. A project management plan is a dynamic management tool
that requires periodic updates when a project transitions from one
phase to another, or as a result of other changes, such as turnover in
personnel. This section would continue the requirement for regular
reporting and clarify other requirements aimed at improving the
management of a major capital project. Specifically, FTA's proposed
amendments would limit oversight to quarterly reviews, as opposed to
monthly reviews, but provide for more frequent oversight when the
recipient fails to meet the requirements of the project management plan
and the project is at risk of materially exceeding the budget or
falling behind schedule. This section also would add a process for at-
risk and noncompliant projects undergoing more frequent oversight to
return to quarterly reviews.
Section 633.29 Project Management Plan Waivers
    FTA proposes repealing this section. Instead, section 633.25 of
this part, as amended, would provide sufficient flexibility to reflect
FTA's practices. FTA may permit a recipient when developing a project
management plan to incorporate applicable elements from a previously
approved project management plan or to incorporate procedures that a
recipient uses to manage other capital projects on a programmatic
basis.
III. Regulatory Analyses and Notices
Executive Order 13771 (Reducing Regulation and Controlling Regulatory
Costs)
    This proposed rule is expected to be an Executive Order 13771
deregulatory action. Details on the estimated cost savings of this
proposed rule can be found in the rule's economic analysis.
Executive Order 12866 (Regulatory Planning and Review), Executive Order
13563 (Improving Regulation and Regulatory Review) and Department of
Transportation (DOT) Regulatory Policies and Procedures
    Executive Orders 12866 and 13563 direct Federal agencies to assess
all costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits--including potential economic, environmental, public
health and safety effects, distributive impacts, and equity. The
proposed rule would amend the definition of a ``major capital project''
under 49 CFR part 633 by raising the total project cost threshold and
adding a minimum Federal share, thereby reducing the number of public
transportation projects subject to project management oversight. This
action complies with Executive Orders 12866 and 13563 to improve
regulation.
    FTA has determined that this rulemaking is not a significant
regulatory action within the meaning of Executive Order 12866 and
within the meaning of DOT regulatory policies and procedures. FTA has
examined the potential economic impacts of this rulemaking and has
determined that this rulemaking is not economically significant because
it will not result in an effect on the economy of $100 million or more.
Additionally, this proposed rule would not have an impact on another
agency and would not materially alter the budgetary impacts of
entitlements, grants, user fees, or loan programs. This rule would not
raise novel legal issues.
    To calculate the benefits and annual cost savings from this
proposed rule, FTA evaluated its project management oversight contracts
for major capital projects from 2013 through 2018. This period was
chosen to reflect changes to FTA's program management oversight
procedures after MAP-21 was enacted in 2012. This period included a
number of emergency relief program projects under 49 U.S.C. 5324 to
repair significant damages to public transportation infrastructure
resulting from Hurricane Sandy, which FTA also analyzed.
    Using FTA's risk evaluation tool, FTA evaluated projects in
construction during that period based on ten key risk factors to
produce a risk score from 0-100. Projects were then assigned a risk
range based on the calculated score, with low-risk projects in the
range of 0-39, medium-risk projects from 40-55, and high-risk projects
from 56-100. This evaluation indicated that a majority of high-risk
projects, including eighteen of the twenty-two projects in the high-
risk range, involved total project costs of over $300 million. While
removing project management oversight from projects with total costs
between $100 and $300 million may increase the risk of materially
exceeding budget or falling behind schedule for some projects, there
are currently only four high-risk projects in this range, and under the
proposed rule, FTA may deem certain projects that do not meet the
dollar-amount thresholds a ``major capital project'' to mitigate
unacceptable risk. Additionally, reducing the number of lower-risk
projects undergoing project management oversight will allow FTA to
focus on higher-risk projects while yielding annual cost savings to FTA
and its recipients.
    FTA calculated the average total cost of oversight for projects in
construction during that period that would not have qualified as major
capital projects under the default threshold of this proposed rule. FTA
estimates that an average of 38.3 projects annually, including
emergency relief program projects, would no longer require additional
oversight under the default threshold.
    This proposed rule would reduce recipients' labor hours for
oversight procedures, which include attending meetings, preparing
quarterly reports and other requested documents, and accompanying
contractors onto project construction sites. To estimate the potential
cost savings for project sponsors, FTA staff examined the current
projects in construction that would no longer qualify as major capital
projects under the NPRM and estimated the level of effort required for
oversight procedures. For two projects, FTA received input from
recipients. Assuming variations in the level of effort based on the
complexity of the project, FTA estimated that the labor hours required
for recipients ranges from 1.7 to 2.3 times FTA's level of effort of
approximately 39,477 hours per year for project management oversight
procedures. Accordingly, FTA used an average factor of two and
determined that the default threshold to qualify as a major capital
project under the proposed rule would reduce the level of effort
required for project sponsors by an average of 78,955 hours annually at
a wage rate of $139.67 based on an average of the Bureau of Labor
Statistics rate for Construction Managers and the PMOC loaded rate for
contractors. This burden reduction would result in an annual cost
savings to project sponsors of approximately $11 million.
    In addition, the proposed rule would reduce the level of effort
required under
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FTA's project management oversight contracts and yield corresponding
cost savings to FTA. Removing oversight from an average of 38.3
projects annually would yield annual cost savings to FTA of
approximately $8.1 million.
Regulatory Flexibility Act
    In compliance with the Regulatory Flexibility Act (Pub. L. 96-354;
5 U.S.C. 601-612), FTA has evaluated the likely effects of the
proposals set forth in this NPRM on small entities, and has determined
that the NPRM would not have a significant economic impact on a
substantial number of small entities.
Unfunded Mandates Reform Act of 1995
    FTA has determined that this rule does not impose unfunded
mandates, as defined by the Unfunded Mandates Reform Act of 1995 (Pub.
L. 104-4, March 22, 1995, 109 Stat. 48). This rule does not include a
Federal mandate that may result in expenditures of $155.1 million or
more in any 1 year (when adjusted for inflation) in 2012 dollars for
either State, local, and tribal governments in the aggregate, or by the
private sector. Additionally, the definition of ``Federal mandate'' in
the Unfunded Mandates Reform Act excludes financial assistance of the
type in which State, local, or tribal governments have authority to
adjust their participation in the program in accordance with changes
made in the program by the Federal Government. Federal public
transportation law permits this type of flexibility.
Executive Order 13132 (Federalism)
    Executive Order 13132 requires agencies to assure meaningful and
timely input by State and local officials in the development of
regulatory policies that may have a substantial direct effect on the
States, on the relationship between the national government and the
States, or on the distribution of power and responsibilities among the
various levels of government. FTA has analyzed this action in
accordance with the principles and criteria contained in Executive
Order 13132, and FTA determined that this action will not have a
substantial direct effect or federalism implications on the States. FTA
also determined that this action will not preempt any State law or
regulation or affect the States' ability to discharge traditional State
governmental functions.
Executive Order 12372 (Intergovernmental Review)
    The regulations effectuating Executive Order 12372 regarding
intergovernmental consultation on Federal programs and activities apply
to this proposed rulemaking.
Paperwork Reduction Act
    Federal agencies must obtain approval from the Office of Management
and Budget (OMB) for each collection of information they conduct,
sponsor, or require through regulations. FTA has analyzed this rule
under the Paperwork Reduction Act and determined that it does not
impose additional information collection requirements for the purposes
of the Act above and beyond existing information collection clearances
from OMB.
National Environmental Policy Act
    NEPA requires Federal agencies to analyze the potential
environmental effects of their proposed actions in the form of a
categorical exclusion, environmental assessment, or environmental
impact statement. This proposed rulemaking is categorically excluded
under FTA's environmental impact procedure at 23 CFR 771.118(c)(4),
which pertains to planning and administrative activities that do not
involve or lead directly to construction, such as the promulgation of
rules, regulations, and directives. FTA has determined that no unusual
circumstances exist in this instance, and that a categorical exclusion
is appropriate for this rulemaking.
Executive Order 12630 (Taking of Private Property)
    FTA has analyzed this rule under Executive Order 12630,
Governmental Actions and Interference with Constitutionally Protected
Property Rights. FTA does not believe this rule effects a taking of
private property or otherwise has taking implications under Executive
Order 12630.
Executive Order 12898 (Federal Actions To Address Environmental Justice
in Minority Populations and Low-Income Populations)
    Executive Order 12898, Federal Actions to Address Environmental
Justice in Minority Populations and Low-Income Populations, and DOT
Order 5610.2(a) (77 FR 27534) require DOT agencies to achieve
environmental justice (EJ) as part of their mission by identifying and
addressing, as appropriate, disproportionately high and adverse human
health or environmental effects, including interrelated social and
economic effects, of their programs, policies, and activities on
minority and/or low-income populations. The DOT Order requires DOT
agencies to address compliance with the Executive Order and the DOT
Order in all rulemaking activities. In addition, on July 17, 2014, FTA
issued a circular to update its EJ Policy Guidance for Federal Transit
Recipients (www.fta.dot.gov/legislation_law/12349_14740.html), which
addresses administration of the Executive Order and DOT Order.
    FTA has evaluated this rule under the Executive Order, the DOT
Order, and the FTA Circular and has determined that this rulemaking
will not cause disproportionately high and adverse human health and
environmental effects on minority or low-income populations.
Executive Order 12988 (Civil Justice Reform)
    This action meets the applicable standards in sections 3(a) and
3(b)(2) of Executive Order 12988 (February 5, 1996), Civil Justice
Reform, to minimize litigation, eliminate ambiguity, and reduce burden.
Executive Order 13045 (Protection of Children)
    FTA has analyzed this proposed rulemaking under Executive Order
13045 (April 21, 1997), Protection of Children from Environmental
Health Risks and Safety Risks. FTA certifies that this proposed rule
will not cause an environmental risk to health or safety that might
disproportionately affect children.
Executive Order 13175 (Tribal Consultation)
    FTA has analyzed this action under Executive Order 13175 (November
6, 2000), and determined that it will not have substantial direct
effects on one or more Indian tribes; will not impose substantial
direct compliance costs on Indian tribal governments; and will not
preempt tribal laws. Therefore, a tribal summary impact statement is
not required.
Executive Order 13211 (Energy Effects)
    FTA has analyzed this proposed rulemaking under Executive Order
13211, Actions Concerning Regulations That Significantly Affect Energy
Supply, Distribution, or Use (May 18, 2001). FTA has determined that
this action is not a significant energy action under the Executive
Order, given that the action is not likely to have a significant
adverse effect on the supply, distribution, or use of energy.
Therefore, a Statement of Energy Effects is not requirement.
[[Page 44594]]
Privacy Act
    Anyone may search the electronic form of all comments received into
any of FTA's dockets by the name of the individual submitting the
comment, or signing the comment if submitted on behalf of an
association, business, labor union, or any other entity. You may review
USDOT's complete Privacy Act Statement published in the Federal
Register on April 11, 2000, at 65 FR 19477-8.
Statutory/Legal Authority for This Rulemaking
    This rulemaking is issued under the authority of 49 U.S.C. 5327,
which requires the Secretary to conduct oversight of major capital
projects and to promulgate a rule for that purpose that includes a
definition of major capital project to delineate the types of projects
governed by the rule.
Regulation Identifier Number
    A Regulation Identifier Number (RIN) is assigned to each regulatory
action listed in the Unified Agenda of Federal Regulations. The
Regulatory Information Service Center publishes the Unified Agenda in
April and October of each year. The RIN set forth in the heading of
this document can be used to cross-reference this action with the
Unified Agenda.
List of Subjects in 49 CFR Part 633
    Grant programs--transportation, Mass transportation.
    Issued in Washington, DC, under authority delegated in 49 CFR
1.90.
K. Jane Williams,
Acting Administrator.
    In consideration of the foregoing, and under the authority of 49
U.S.C. 5327, the Federal Transit Administration proposes to amend 49
CFR chapter VI by revising part 633, as follows:
PART 633--PROJECT MANAGEMENT OVERSIGHT
Subpart A--General Provisions
Sec.
633.1 Purpose.
633.3 Scope.
633.5 Definitions.
Subpart B--Project Management Oversight Services
633.11 Covered projects.
633.13 Initiation of project management oversight services.
633.15 Access to information.
633.17 Project management oversight contractor eligibility.
633.19 Exclusion from the project management oversight program.
Subpart C--Project Management Plans
633.21 Basic requirement.
633.23 FTA review of a project management plan.
633.25 Contents of a project management plan.
633.27 Implementation of a project management plan.
633.29 [Reserved]
    Authority: 49 U.S.C. 5327; 49 CFR 1.90.
Subpart A--General Provisions
Sec.  633.1  Purpose.
    This part implements 49 U.S.C. 5327 regarding oversight of major
capital projects. The part provides for a two-part program for major
capital projects receiving Federal financial assistance. First, subpart
B discusses project management oversight, designed primarily to aid FTA
in its role of ensuring successful implementation of federally-funded
projects. Second, subpart C discusses the requirement that, to receive
Federal financial assistance for a major capital project for public
transportation under Chapter 53 of Title 49, United States Code, or any
other provision of Federal law, a recipient must prepare a project
management plan approved by the Administrator and carry out the project
in accordance with the project management plan.
Sec.  633.3  Scope.
    This rule applies to a recipient of Federal financial assistance
undertaking a major capital project for public transportation under
Chapter 53 of Title 49, United States Code, or any other provision of
Federal Law.
Sec.  633.5  Definitions.
    As used in this part:
    (a) Administrator means the Administrator of the Federal Transit
Administration or the Administrator's designee.
    (b) Days means calendar days.
    (c) Fixed guideway means any public transportation facility: using
and occupying a separate right-of-way for the exclusive use of public
transportation; using rail; using a fixed catenary system; for a
passenger ferry system; or for a bus rapid transit system.
    (d) FTA means the Federal Transit Administration.
    (e) Except as provided in Sec.  633.19 of this part, Major capital
project means a project that:
    (1) Involves the construction, expansion, rehabilitation, or
modernization of a fixed guideway that:
    (i) Has a total project cost of $300 million or more and receives
Federal funds of $100 million or more; and
    (ii) Is not exclusively for the acquisition, maintenance, or
rehabilitation of vehicles or other rolling stock; or
    (2) The Administrator determines to be a major capital project
because project management oversight under this part will benefit the
Federal government or the recipient, and the project is not exclusively
for the acquisition, maintenance, or rehabilitation of rolling stock or
other vehicles. Typically, this means a project that:
    (i) Involves new technology;
    (ii) Is of a unique nature for the recipient; or
    (iii) Involves a recipient whose past record indicates the
appropriateness of extending project management oversight under this
part.
    (f) Project development means the phase of a project after a
locally preferred alternative has been chosen where design and
engineering work is undertaken to advance the project from concept to a
sufficiently mature scope to allow for the development of a reasonably
reliable project cost, schedule, and project management plan.
    (g) Project management oversight means the risk-informed monitoring
of the recipient's management of a major capital project's progress to
determine whether the project is on time, within budget, in conformance
with design and quality criteria, in compliance with all applicable
Federal requirements, constructed to approved plans and specifications,
delivering the identified benefits, and safely, efficiently, and
effectively implemented.
    (h) Project management plan means a written document prepared by a
recipient that explicitly defines all tasks necessary to implement a
major capital project. A project management plan may be a single
document or a series of documents or sub plans integrated with one
another into the project management plan either directly or by
reference for the purpose of defining how the recipient will
effectively manage, monitor, and control all phases of the project.
    (i) Recipient means a direct recipient of Federal financial
assistance or the sponsor of a major capital project.
Subpart B--Project Management Oversight Services
Sec.  633.11  Covered projects.
    (a) The recipient is using funds made available under Chapter 53 of
Title 49, United States Code, or any other provision of Federal law;
and
    (b) The project is a major capital project.
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Sec.  633.13  Initiation of project management oversight services.
    Project management oversight services will be initiated as soon as
practicable, once the Administrator determines that this part applies.
In most cases, this means that project management oversight will begin
during the project development phase of the project, unless the
Administrator determines it more appropriate to begin oversight during
another phase of the project, to maximize the transportation benefits
and cost savings associated with project management oversight.
Sec.  633.15  Access to information.
    A recipient for a major capital project shall provide the
Administrator and the project management oversight contractor chosen
under this part access to its records and construction sites, as
reasonably may be required.
Sec.  633.17  Project management oversight contractor eligibility.
    (a) Any person or entity may provide project management oversight
services in connection with a major capital project, with the following
exceptions:
    (1) An entity may not provide project management oversight services
for its own project; and
    (2) An entity may not provide project management oversight services
for a project if there exists a conflict of interest.
    (b) In choosing private sector persons or entities to provide
project management oversight services, the Administrator uses the
procurement requirements in the government-wide procurement
regulations, found at 48 CFR Chapter I.
Sec.  633.19  Exclusion from the project management oversight program.
    The Administrator may, in compelling circumstances, determine that
a project meeting the criteria of Sec.  633.5(e)(1) of this part is not
a major capital project because project management oversight under this
part will not benefit the Federal government or the recipient.
Typically, this means a project that:
    (a) Involves a recipient whose past record indicates the
appropriateness of excluding the project from project management
oversight under this part; and
    (b) Involves such a greater level of financial risk to the
recipient than to the Federal government that project management
oversight under this part is made less necessary to secure the
recipient's diligence.
Subpart C--Project Management Plans
Sec.  633.21  Basic requirement.
    (a) If a project meets the definition of major capital project, the
recipient shall submit a project management plan prepared in accordance
with Sec.  633.25 of this part, as a condition of Federal financial
assistance.
    (b)(1) The Administrator will notify the recipient when the
recipient must submit the project management plan. Normally, the
Administrator will notify the recipient sometime during the project
development phase. If the Administrator determines the project is a
major capital project after the project development phase, the
Administrator will inform the recipient of the determination as soon as
possible.
    d. Revise subsection (b)(2) to read as follows:
    (2) Once the Administrator has notified the recipient that it must
submit a plan, the recipient will have a minimum of 90 days to submit
the plan.
Sec.  633.23  FTA review of a project management plan.
    Within 60 days of receipt of a project management plan, the
Administrator will notify the recipient that:
    (a) The plan is approved;
    (b) The plan is disapproved, including the reasons for the
disapproval;
    (c) The plan will require modification, as specified, before
approval; or
    (d) The Administrator has not yet completed review of the plan, and
state when it will be reviewed.
Sec.  633.25  Contents of a project management plan.
    A project management plan must be tailored to the type, costs, and
complexity of the major capital project, and to the recipient's
management capacity and capability. A project management plan must be
written to a level of detail sufficient to enable the recipient to
determine whether the necessary staff and processes are in place to
control the scope, budget, schedule, and quality of the project, while
managing the safety and security of all persons. A project management
plan must be developed with a sufficient level of detail to enable the
Administrator to assess the adequacy of the recipient's plan.
    At a minimum, a recipient's project management plan shall include:
    (a) Adequate recipient staff organization with well-defined
reporting relationships, statements of functional responsibilities, job
descriptions, and job qualifications;
    (b) A budget covering the project management organization,
appropriate contractors and consultants, property acquisition, utility
relocation, systems demonstration staff, audits, contingencies, and
miscellaneous payments as the recipient may be prepared to justify;
    (c) A construction schedule for the project;
    (d) A document control procedure and recordkeeping system;
    (e) A change order procedure that includes a documented, systematic
approach to the handling of construction change orders;
    (f) A description of organizational structures, management skills,
and staffing levels required throughout the construction phase;
    (g) Quality control and quality assurance functions, procedures,
and responsibilities for project design, procurement, construction,
system installation, and integration of system components;
    (h) Material testing policies and procedures;
    (i) Internal plan implementation and reporting requirements
including cost and schedule control procedures;
    (j) Criteria and procedures to be used for testing the operational
system or its major components;
    (k) Periodic updates of the plan, especially related to project
budget and project schedule, financing, ridership estimates, and the
status of local efforts to enhance ridership where ridership estimates
partly depend on the success of those efforts;
    (l) The recipient's commitment to submit a project budget and
project schedule to the Administrator quarterly;
    (m) Safety and security management; and
    (n) Management of risks, contingencies, and insurance.
Sec.  633.27  Implementation of a project management plan.
    (a) Upon approval of a project management plan by the Administrator
the recipient shall begin implementing the plan.
    (b) Generally, a project management plan must be modified if the
project is at a new phase or if there have been significant changes
identified. If a recipient must modify an approved project management
plan, the recipient shall submit the proposed changes to the
Administrator along with an explanation of the need for the changes.
    (c) A recipient shall submit periodic updates of the project
management plan to the Administrator. Such updates shall include, but
not be limited to:
    (1) Project budget;
    (2) Project schedule;
    (3) Financing, both capital and operating;
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    (4) Ridership estimates, including operating plan; and
    (5) Where applicable, the status of local efforts to enhance
ridership when estimates are contingent, in part, upon the success of
such efforts.
    (d) A recipient shall submit current data on a major capital
project's budget and schedule to the Administrator on a quarterly basis
for the purpose of reviewing compliance with the project management
plan, except that the Administrator may require submission more
frequently than on a quarterly basis if the recipient fails to meet the
requirements of the project management plan and the project is at risk
of materially exceeding its budget or falling behind schedule.
Oversight of projects monitored more frequently than quarterly will
revert to quarterly oversight once the recipient has demonstrated
compliance with the project management plan and the project is no
longer at risk of materially exceeding its budget or falling behind
schedule.
Sec.  633.29  [Reserved]
[FR Doc. 2019-18286 Filed 8-23-19; 8:45 am]
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