Grants and cooperative agreements; availability, etc.: Transit programs; changes and final funding levels (1998 FY),

[Federal Register: June 24, 1998 (Volume 63, Number 121)]

[Notices]

[Page 34505-34547]

From the Federal Register Online via GPO Access [wais.access.gpo.gov]

[DOCID:fr24jn98-146]

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Part II

Department of Transportation

Federal Transit Administration

FTA Transit Program Changes and Final Funding Levels for Fiscal Year 1998 Under the Transportation Equity Act for the 21st Century; Notice

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DEPARTMENT OF TRANSPORTATION

Federal Transit Administration

FTA Transit Program Changes and Final Funding Levels for Fiscal Year 1998 Under the Transportation Equity Act for the 21st Century

AGENCY: Federal Transit Administration (FTA), DOT.

ACTION: Notice.

SUMMARY: This Notice announces the availability of the remaining fiscal year 1998 funding for the Federal transit programs that was not available previously due to the lack of a full year authorization of the transit program. The Transportation Equity Act for the 21st Century (TEA-21), signed into law by President Clinton on June 9, 1998, provides a six-year reauthorization of the Federal transit program and the necessary contract authority needed to fully fund the fiscal year 1998 obligation limitations contained in the fiscal year 1998 Department of Transportation Appropriations Act. In addition to announcing the remaining fiscal year funding, this Notice also revises the apportionment of funding for the Section 5307 Urbanized Area Formula Program in compliance with new provisions which require a one percent set-aside for transit enhancements, and $4,849,950 to be set aside for financing the Alaska Railroad. Additionally, this Notice revises the apportionment of funds for the Section 5309 Fixed Guideway Modernization Program to reflect the new allocation formula established in TEA-21. It also revises the Section 5309 Bus Allocations to comply with new provisions in TEA-21 to fund a Bus Test Facility in the amount of $3,000,000 and a Fuel Cell Bus Program in the amount of $4,850,000 in fiscal year 1998. These two programs were not provided for in the original Bus Allocations.

This Notice updates and expands on the December 5, 1997, Federal Register Notice entitled ``FTA Fiscal Year 1998 Apportionments, Allocations and Program Information.'' It also contains information regarding the changes made by TEA-21 to the various Federal transit programs, as well as the FTA policy on pre-award authority and other new program information.

The new programs are the Clean Fuels Formula Program, the Job Access and Reverse Commute Program, the Over-the-Road Bus Accessibility program, the Single State Pilot Program for Intercity Rail Infrastructure Investment, and the State Infrastructure Banks Pilot Program. The funding level for the Over-the-Road Bus Accessibility Program is subject to a pending technical correction bill which would decrease the $6.8 million a year for operators of other over-the-road service to a total of $6.8 million for the four years, 2000-2003.

FOR FURTHER INFORMATION CONTACT: The appropriate FTA Regional Administrator for grant-specific information and issues; Patricia Levine, Director, Office of Resource Management and State Programs, (202) 366-2053, for general information about the Urbanized Area Formula Program, the Nonurbanized Area Formula Program, the Elderly and Persons with Disabilities Program, the Rural Transit Assistance Program, or the Capital Program; or Robert Stout, Director, Office of Planning Operations, (202) 366-6385, for general information concerning the Metropolitan Planning Program and the State Planning and Research Program.

SUPPLEMENTARY INFORMATION:

Table of Contents

  1. Background II. FTA Fiscal Year 1998 Funds Available for Obligation III. Fiscal Year 1998 Revised Section 5307 Urbanized Area Formula Apportionments IV. Fiscal Year 1998 Revised Section 5309 Fixed Guideway Modernization Apportionments V. Fiscal Year 1998 Revised Section 5309 Bus Allocations VI. Transit Authorization Levels Under TEA-21 VII. Changes Affecting FTA Formula, Capital Investment and Planning Programs

    1. Capital Project Definitions

    2. Operating Assistance

    3. Preventive Maintenance

    4. Transit Enhancements

    5. Proceeds from Sale of Assets

    6. Revenue Bond Proceeds As Local Share

    7. Notice of Pre-award Authority to Incur Project Costs

      1. Conditions

      2. Environmental, Planning, and Other Federal Requirements

    8. Metropolitan Planning

  2. New Starts Evaluation and Criteria VIII. New Programs Authorized by TEA-21

    1. Clean Fuels Formula Program

      1. Definition of Eligible Projects

      2. Application and Apportionment Deadlines

      3. Formula for Apportioning Funds

      4. Availability of Funds

    2. Job Access and Reverse Commute Program

      1. Definition and Eligible Projects

      2. Factors for Consideration

      3. Availability of Funds and Grant Requirements

    3. Over-the-Road Bus Accessibility Program

    4. Single State Pilot Program for Intercity Rail Infrastructure Investment

    5. State Infrastructure Banks Pilot Program IX. General Information Tables:

      1. FTA Fiscal Year 1998 Revised Appropriations and Funds Available for Grant Programs

      2. FTA Fiscal Year 1998 Revised Section 5307 Urbanized Area Formula Apportionments

      3. FTA Fiscal Year 1998 Revised Section 5309 Fixed Guideway Modernization Apportionments

      4. FTA Fiscal Year 1998 Revised Section 5307 Section 5309 Bus Allocations

      5. FTA TEA-21 Authorization Levels

      6. FTA TEA-21 New Start Project Authorizations

      7. FTA TEA-21 Bus Capital Project Authorizations

      8. FTA Fiscal Years 1998-2003 Apportionment Formula for Sections 5307 and 5311

      9. FTA Fiscal Years 1998-2003 Apportionment Formula for Section 5309 Fixed Guideway Modernization Program

      10. FTA Unit Values of Data--Fiscal Year 1998 Revised Formula Grant Apportionments

  3. Background

    The fiscal year 1998 apportionments and allocations for the formula, capital, and transit planning and research programs were published in a Federal Register Notice on December 5, 1997, entitled ``FTA Fiscal Year 1998 Apportionments, Allocations and Program Information.'' That Notice contained apportioned funds based on the 1998 Appropriations Act and Federal transit laws, as well as funds available under the Surface Transportation Extension Act of 1997. Because the Surface Transportation Extension Act of 1997 only provided contract authority through March 31, 1998, FTA published (1) a listing of the full amount of the fiscal year 1998 apportionments and allocations for the formula, capital, and transit planning and research programs, based on the 1998 Appropriations Act and Federal transit laws; and (2) a listing of the partial amount of the apportionments and allocations, based on the fiscal year 1998 available funds for these programs, in accordance with the 1998 DOT Appropriations Act and the Surface Transportation Extension Act of 1997. Now that full year contract authority is provided under TEA-21, the full amount of the fiscal year 1998 apportionments and allocations is available for obligation.

  4. FTA Fiscal Year 1998 Funds Available for Obligation

    The total fiscal year 1998 apportionments and allocations for the formula, capital investment, and transit planning and research programs in the amount of $4,547,737,724 were

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    published in the Federal Register Notice of December 5, 1997. Full obligational authority for each of the amounts listed in the December 5, 1997, Notice is now provided for the following programs:

    Section 5307 Urbanized Area Formula Program;

    Section 5311 Nonurbanized Area Formula Program;

    Section 5310 Elderly and Persons with Disabilities Program;

    Section 5309 Capital Investment Program: Fixed-Guideway Modernization Program, and the Bus Capital Program.

    Obligational authority for the following programs is not affected by this Notice because they received the full year's funding pursuant to the December 5, 1997, Federal Register Notice:

    Section 5311(b) Rural Transit Assistance Program Funds;

    Section 5309 New Starts Program;

    Section 5303 Metropolitan Planning Program;

    Section 5313(b) State Planning and Research Program.

    Table 1 displays the amount of appropriations and funds available for each of the programs listed in this Notice.

  5. Fiscal Year 1998 Revised Section 5307 Urbanized Area Formula Apportionments

    The new law provides that, of the funds apportioned each fiscal year under the Urbanized Area Formula Program to urbanized areas of 200,000 or more in population, at least one percent shall be used for transit enhancement activities. It also requires that $4,849,950 shall be available annually to the Alaska Railroad for improvements to its passenger operations. Accordingly, the fiscal year 1998 Urbanized Area Formula apportionment has been revised to accommodate these two provisions.

    The fiscal year 1998 funds appropriated and made available for Urbanized Area Formula grants total $2,303,702,677. After a deduction of .32343056 of one percent for Project Management Oversight ($7,450,879), $2,296,251,798 is available for apportionment to the urbanized areas and states. Of this amount, $4,834,264 ($4,849,950 less $15,6896 for PMO) is set aside for the Alaska Railroad. In addition to the balance of $2,291,417,534 of the appropriated funds, the revised apportionment also includes $7,162,381 in deobligated funds which have become available for reapportionment for the Urbanized Area Formula Program, leaving a balance of $2,298,579,915 to be apportioned to urbanized areas and states. Table 2 shows a revised apportionment of $2,303,414,179, which includes the Alaska Railroad.

    There is no longer an operating assistance limitation for areas under 200,000 in population. TEA-21 eliminates Federal financing of operating expenses for areas 200,000 and above effective immediately.

    Also indicated on Table 2 is the amount set aside for transit enhancements as provided in TEA-21. See Section VII.D of this Notice for a further discussion of transit enhancement funds. This transit enhancement provision is effective immediately.

  6. Fiscal Year 1998 Revised Section 5309 Fixed Guideway Modernization Apportionments

    TEA-21 modifies the formula for allocating the Fixed Guideway Modernization funds. The new formula contains seven tiers rather than four. The allocation of funding under the first four tiers has been modified slightly and, through fiscal year 2003, will be allocated based on data used to apportion the funding in fiscal year 1997. Funding in the three new tiers will be apportioned based on the latest available route miles and revenue vehicle miles on segments at least seven years old as reported to the National Transit Database, rather than on route miles and revenue vehicle miles on entire systems which are seven years old.

    TEA-21 specifically required the FTA to revise the fiscal year 1998 Fixed Guideway Modernization funds using the new formula. This has resulted in generally minor changes in the amounts available. However, one area, Worcester, Massachusetts, is no longer eligible, because the fixed guideway segment attributable to that urbanized area was not in place as of October 1, 1990. For the fiscal year 1998 revised apportionments, sufficient funds were available to allocate only to the first five tiers. The revised apportionments are contained in Table 3. For the reapportionment of fiscal year 1998 funds, Tier 5 uses Urbanized Area Formula Program fixed guideway tier formula factors that were used to apportion the fiscal year 1998 Fixed Guideway allocations in the December 5, 1997, Federal Register Notice. Any fixed guideway segment that is less than seven years old has been deleted from this data base.

    For fiscal year 1998, there is an $800,000,000 obligation limitation for fixed guideway modernization. After a deduction of .32343056 of one percent for Project Management Oversight ($2,587,445), $797,412,555 is available for apportionment to the specified urbanized areas.

    Each year, the new fixed guideway modernization formula will allocate funds by seven tiers as follows:

    Tier 1

    The first $497,700,000 shall be apportioned to the following urbanized areas as follows: Baltimore $8,372,000; Boston $38,948,000; Chicago/Northwestern Indiana $78,169,000; Cleveland $9,509,500; New Orleans $1,730,588; New York $176,034,461; Northeastern New Jersey $50,604,653; Philadelphia/Southern New Jersey $58,924,764; Pittsburgh $13,662,463; San Francisco $33,989,571; Southwestern Connecticut $27,755,000.

    Tier 2

    The next $70,000,000 shall be apportioned as follows: Tier 2B: 50 percent to areas identified in Tier 1; and Tier 2B: 50 percent to other urbanized areas with fixed guideway in operation at least seven years. Funds for both Tiers 2A and 2B are apportioned using the Urbanized Area Formula Program fixed guideway tier formula factors that were used to apportion funds for the Fixed Guideway Modernization Program in fiscal year 1997.

    Tier 3

    The next $5,700,000 shall be apportioned to the following urbanized areas as follows: Pittsburgh, 61.76 percent; Cleveland, 10.73 percent; New Orleans, 5.79 percent; the remaining 21.72 percent is apportioned to areas in Tier 2B using the fixed guideway tier formula factors used in fiscal year 1997.

    Tier 4

    The next $186,600,000 shall be apportioned to all eligible areas using the fixed guideway tier formula factors used in fiscal year 1997.

    Tier 5

    The next $70,000,000 shall be apportioned as follows: 65 percent to the eleven areas specified in Tier I, and 35 percent to all other urbanized areas using the most current urbanized area formula program fixed guideway tier formula factors. Any segment this is less than seven years old has been deleted from this data base.

    Tier 6

    The next $50,000,000 shall be apportioned as follows: 60 percent to the eleven areas specified in Tier I, and 30 percent to the other urbanized areas with fixed guideway system segments in

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    revenue service for at least seven years. Allocations will be based on the latest available route miles and revenue vehicle miles for fixed guideway segments at least seven years old as reported to the National Transit Database.

    Tier 7

    Any remaining amounts shall be apportioned as follows: 50 percent to the eleven urbanized areas specified in Tier I, and 50 percent to the other urbanized areas with fixed guideway system segments in revenue service for at least seven years. Allocations will be based on the latest available route miles and revenue vehicle miles for fixed guideway segments at least seven years old as reported to the National Transit Database.

  7. Fiscal Year 1998 Revised Section 5309 Bus Allocations

    TEA-21 provides funding for a Bus Testing Facility in the amount of $3,000,000 and a Fuel Cell Bus Program in the amount of $4,850,000 in fiscal year 1998. These two programs were not provided for in the original allocations; therefore, all bus allocations have been reduced on a prorated basis to accommodate these two additional activities. Table 4 displays the revised allocations.

  8. Transit Authorization Levels Under TEA-21

    TEA-21 provides a combination of trust and general fund authorizations that total $42.0 billion over the six year period, fiscal years 1998--2003. However, $36 billion is guaranteed funds included under the discretionary spending cap. TEA-21 includes $6 billion above the guaranteed level. See Table 5 for the guaranteed funding levels by program, and Table 5A for the guaranteed and nonguaranteed levels by program.

    TEA-21 authorizes 191 New Starts projects. Of this number, 108 projects are authorized for final design and construction funding and 68 projects are authorized for alternatives analysis and preliminary engineering funding. Of these, 34 projects have specific dollar amounts associated with them. An additional 15 projects have specific dollar amounts but are not included in the first two lists. All earmarks are listed in Table 6 by area and project, including the dollar amount if specified. Projects authorized for alternatives analysis and preliminary engineering also become authorized for final design and construction as of October 1, 2000.

    TEA-21 contains a provision that makes $10,400,000 available from Section 5309 New Starts funds in fiscal years 1999--2003 for ferry boat capital projects in Alaska or Hawaii. These projects may be ferry boats or ferry terminal facilities or approaches to ferry terminal facilities. TEA-21 also authorizes an additional $3,600,000 from Section 5309 New Start nonguaranteed funds in fiscal years 1999--2003 for ferry projects as defined above.

    It should be noted that projects earmarked in TEA-21 are subject to Congressional actions in later appropriations bills.

    Also authorized are project specific allocations in fiscal years 1999 and 2000 for 158 Capital Investment Bus projects totaling $539,637,000. These projects by amount and area are displayed on Table 7.

    Information regarding estimates of funding levels for 1999--2003 by state and urbanized area is available on the FTA home page at www.fta.dot.gov. These numbers are for planning purposes only as they will be revised in the future but may be used for programming metropolitan transportation improvement programs and statewide transportation improvement programs.

  9. Changes Affecting FTA Formula, Capital Investment, and Planning Programs

    1. Capital Project Definitions

      TEA-21 amends the definition of a capital project placing several new items in the general definition and formally codifying in the FTA authorizing statute several items that had been modified in the past through appropriations acts.

      Following is the definition of a capital project contained in TEA- 21. The term `capital project' means a project for:

      1. Acquiring, constructing, supervising or inspecting equipment or a facility for use in mass transportation, expenses incidental to the acquisition or construction (including designing, engineering, location surveying, mapping, and acquiring rights of way), payments for the capital portions of rail trackage rights agreements, transit-related intelligent transportation systems, relocation assistance, acquiring replacement housing sites, and acquiring, constructing, relocating, and rehabilitating replacement housing;

      2. Rehabilitating a bus;

      3. Remanufacturing a bus;

      4. Overhauling rail rolling stock;

      5. Preventive maintenance;

      6. Leasing equipment or a facility for use in mass transportation subject to regulations the Secretary prescribes limiting the leasing arrangements to those that are more cost-effective than acquisition or construction;

      7. Joint development: a mass transportation improvement that enhances economic development or incorporates private investment, including commercial and residential development, pedestrian and bicycle access to a mass transportation facility, and the renovation and improvement of historic transportation facilities, because the improvement enhances the effectiveness of a mass transportation project and is related physically or functionally to that mass transportation project or establishes new or enhanced coordination between mass transportation and other transportation, and provides a fair share of revenue for mass transportation that will be used for mass transportation--

        (a) Including property acquisition, demolition of existing structures, site preparation, utilities, building foundations, walkways, open space, safety and security equipment and facilities (including lighting, surveillance, and related intelligent transportation system applications), facilities that incorporate community services such as daycare and health care, and a capital project for, and improving, equipment or a facility for an intermodal transfer facility or transportation mall, except that a person making an agreement to occupy space in a facility under this subparagraph shall pay a reasonable share of the costs of the facility through rental payments and other means; and

        (b) Excluding construction of a commercial revenue-producing facility or a part of a public facility not related to mass transportation;

      8. The introduction of new technology, through innovative and improved products, into mass transportation; or

      9. The provision of nonfixed route paratransit transportation services in accordance with section 223 of the Americans with Disabilities Act of 1990 (42 U.S.C. 12143), but only for grant recipients that are in compliance with applicable requirements of that Act, including both fixed route and demand responsive service, and only for amounts not to exceed 10 percent of such recipient's annual formula apportionment under sections 5307 and 5311.''

    2. Operating Assistance

      Operating assistance for urbanized areas with populations under 200,000 continues to be available, at the Federal/local share ratio of 50/50, with no limitation on the amount of a grantee's

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      apportionment that may be used for operating assistance. Operating assistance funds for urbanized areas with populations of 200,000 and above are no longer available as of effective date of TEA-21.

      For fiscal year 1999 and thereafter, operating assistance is available only to nonurbanized and urbanized areas with populations under 200,000. For these smaller areas, there is no limitation on the amount of the apportionment that may be used for operating assistance, and the Federal/local share ratio is 50/50. However, for both categories of urbanized areas, many of the activities formerly funded by FTA with operating assistance are now eligible capital items under the category of preventive maintenance. Operating assistance as a capital project with an 80 percent federal match ratio will continue for fiscal year 1998 for areas under 200,000. Operating assistance at the 80/20 match will not be available in fiscal year 1999 or thereafter.

    3. Preventive Maintenance

      Preventive maintenance, an expense that became eligible for FTA capital assistance with the DOT 1998 Appropriations Act, is now eligible for FTA capital assistance under TEA-21, so that fiscal year 1998 funds and subsequent fiscal year appropriations may be used for preventive maintenance. Preventive maintenance costs, as in fiscal year 1998, are defined as all maintenance costs. For general guidance as to the definition of eligible maintenance costs, the grantee should refer to the definition of maintenance in the most recent National Transit Database reporting manual. A grantee may continue to request assistance for capital expenses under the FTA policies governing associated capital maintenance items (spare parts), maintenance of vehicles leased under contract, and vehicle overhauls; or a grantee may choose to capture all maintenance under preventive maintenance. If a grantee purchases service instead of operating service directly, and maintenance is included in the contract for that purchased service, then the grantee may apply for preventive maintenance capital assistance for the actual maintenance costs of the purchased service.

      For accounting purposes, the grantee is cautioned not to confuse the fact that an item generally considered to be an operating expense is now eligible for FTA capital assistance. Generally accepted accounting principles and the grantee's accounting system determine those costs that are to be accounted for as operating costs. The National Transit Database Reporting System (NTD) follows generally accepted accounting principles, and so a grantee reporting to the NTD must report the operating costs the grantee has incurred as operating costs regardless of grant eligibility as capital. Nevertheless, under provisions of the fiscal year 1998 Appropriations Act, and now under provisions of TEA-21, some of those operating costs, while continuing to be accounted for as operating costs in the grantee's accounting records, are now eligible for FTA capital assistance. Grantees may not count the same costs twice.

    4. Transit Enhancements

      TEA-21 establishes a one percent set-aside for transit enhancements under the Urbanized Area Formula Program for areas 200,000 and above in population. The term ``transit enhancement'' includes projects that are designed to enhance mass transportation service or use and are physically or functionally related to transit facilities. Eligible projects are: (1) historic preservation, rehabilitation, and operation of historic mass transportation buildings, structures, and facilities (including historic bus and railroad facilities); (2) bus shelters; (3) landscaping and other scenic beautification, including tables, benches, trash receptacles, and street lights; (4) public art; (5) pedestrian access and walkways; (6) bicycle access, including bicycle storage facilities and installing equipment for transporting bicycles on mass transportation vehicles; (7) transit connections to parks within the recipient's transit service area; (8) signage; and (9) enhanced access for persons with disabilities to mass transportation.

      One percent of the urbanized area formula apportionment in urbanized areas with a population of 200,000 and above shall be available only for transit enhancements. Table 2 indicates the amount set aside for enhancements in urbanized areas of 200,000 and above. If these funds are not obligated for transit enhancement projects by three years following the fiscal year in which the funds are apportioned, the funds shall be reapportioned under the urbanized area formula program.

      The project budget for each urbanized area formula grant application which includes enhancement funds shall include a scope code for transit enhancements and specific budget line activity items for transit enhancements. Transit enhancements may exceed the one percent set-aside. However, items that are only eligible as enhancements such as operating costs for historic facilities may only be funded with the enhancement funds.

      Recipients of the one percent set-aside enhancement funds shall submit a report to the appropriate FTA regional office listing the projects carried out during the fiscal year with those funds. This report shall be part of the recipient's annual certification to the FTA. If at all possible, the report should be submitted electronically and should utilize the budget line item codes used in the approved project budget.

      Under a related provision, projects providing bicycle access to mass transportation funded with the enhancement set-aside shall be funded at a 95 percent Federal share.

    5. Proceeds From Sale of Assets

      TEA-21 provides an additional option for handling proceeds from the sale of federally-funded assets. This new provision allows the recipient, with FTA approval, to sell, transfer, or lease real property, equipment, or supplies acquired with FTA assistance and no longer needed for transit purposes. The net proceeds of the transaction may then be used to reduce the gross project cost of other Federally- assisted capital transit projects.

      If the asset is identified as no longer needed by the grantee for public transportation purposes, and determined by FTA as eligible for disposition, then the new requirements would apply. That is, the proceeds could be retained by the grantee and used to reduce the gross project costs of another Federally-assisted capital transit project prior to applying for Federal financial assistance.

      If the asset is to be retained in transit use after being transferred, sold, or leased, such as by another transit provider or in a joint development project, then existing requirements would apply.

      Previous provisions continue to allow the recipient of assistance to transfer assets to another public agency to be used for a public purpose. Additional information is available from the appropriate FTA Regional Office.

    6. Revenue Bond Proceeds as Local Share

      Beginning with fiscal year 1999, and permissible thereafter, a recipient of assistance under the Urbanized Area Formula Program (Section 5307) and the Capital Program (Section 5309), may use as the local share for capital projects the proceeds from the issuance of bonds that are backed by future revenue from the farebox. This provision of TEA-21 is expected to help reduce borrowing costs for transit authorities. Under this

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      provision, using the proceeds of the revenue bonds as matching share will be approved only if the aggregate amount of financial support from the State and affected local governmental authorities in the urbanized area during the next three fiscal years is not less than the aggregate amount provided by the State and affected local governmental authorities in the urbanized area during the preceding three fiscal years (as is made evident in the State Transportation Improvement Program).

    7. Notice of Pre-Award Authority To Incur Project Costs

      Since fiscal year 1994, FTA has provided pre-award authority to cover certain planning and capital costs prior to grant award. This automatic pre-award spending authority permits a grantee to incur costs on an eligible transit capital or planning project without prejudice to possible future Federal participation in the cost of the project or projects. Prior to exercising pre-award authority, grantees are strongly encouraged to consult with the appropriate regional office where there could be any question regarding the eligibility of the project for future FTA funds.

      Authority to incur costs for fiscal year 1998 Fixed Guideway Modernization, Metropolitan Planning, Urbanized Area Formula, Elderly and Persons with Disabilities, Nonurbanized Area Formula, and State Planning and Research Programs in advance of possible future Federal participation was provided in the December 5, 1997, Federal Register Notice. This pre-award authority now also extends to future formula funds that will be apportioned during the authorization period of TEA- 21, 1998-2003. Pre-award authority also applies to Capital Bus funds identified in the December 5, 1997, notice. This pre-award authority also applies to projects intended to be funded with STP or CMAQ funds transferred to FTA in fiscal year 1998. This pre-award authority for STP or CMAQ funds is now extended for the 1998-2003 authorization period of TEA-21. Pre-award authority applies to FTA funds and flexible funds provided the conditions in paragraphs (1) and (2) below are met. The pre-award authority does not apply to Capital New Start funds, or to Capital Bus projects not specified in this or previous notices. Pre- award authority also applies to preventive maintenance costs incurred within a local fiscal year ending during calendar year 1997, or thereafter, under the formula programs cited above. 1. Conditions

      Similar to the FTA Letter of No Prejudice (LONP) authority, the conditions under which this authority may be utilized are specified below:

      1. This pre-award authority is not a legal or moral commitment that the project(s) will be approved for FTA assistance or that FTA will obligate Federal funds. Furthermore, it is not a legal or moral commitment that all items undertaken by the applicant will be eligible for inclusion in the project(s).

      2. All FTA statutory, procedural, and contractual requirements must be met.

      3. No action will be taken by the grantee that prejudices the legal and administrative findings which the Federal Transit Administrator must make in order to approve a project.

      4. Local funds expended by the grantee pursuant to and after the date of this authority will be eligible for credit toward local match or reimbursement if FTA later makes a grant for the project(s) or project amendment(s).

      5. The Federal amount of any future FTA assistance to the grantee for the project will be determined on the basis of the overall scope of activities and the prevailing statutory provisions with respect to the Federal/local match ratio at the time the funds are obligated.

      6. For funds to which this authority applies, the authority expires with the lapsing of the fiscal year funds. 2. Environmental, Planning, and Other Federal Requirements

      FTA emphasizes that all of the Federal grant requirements must be met for the project to remain eligible for Federal funding. Some of these requirements must be met before pre-award costs are incurred, notably the requirements of the National Environmental Policy Act (NEPA), and the planning requirements. Compliance with NEPA and other environmental laws or executive orders (e.g., protection of parklands, wetlands, historic properties) must be completed before state or local funds are advanced for a project expected to be subsequently funded with FTA funds. Depending on which class the project is included under in FTA's environmental regulations (23 CFR part 771), the grantee may not advance the project beyond planning and preliminary engineering before FTA has approved either a categorical exclusion (refer to 23 CFR part 771.117(d)), a finding of no significant impact, or a final environmental impact statement. The conformity requirements of the Clean Air Act (40 CFR part 51) also must be fully met before the project may be advanced with non-Federal funds.

      Similarly, the requirement that a project be included in a locally adopted metropolitan transportation improvement program and federally approved statewide transportation improvement program must be followed before the project may be advanced with non-Federal funds. In addition, Federal procurement procedures, as well as the whole range of Federal requirements, must be followed for projects in which Federal funding will be sought in the future. Failure to follow any such requirements could make the project ineligible for Federal funding. In short, this increased administrative flexibility requires a grantee to make certain that no Federal requirements are circumvented through the use of pre- award authority. If a grantee has questions or concerns regarding the environmental requirements, or any other Federal requirements that must be met before incurring costs, it should contact the appropriate regional office.

      Before an applicant may incur costs either for activities expected to be funded by New Start funds, or for Bus Capital projects not listed in the December 5, 1997, Federal Register Notice, it must first obtain a written LONP from FTA. To obtain an LONP, a grantee must submit a written request accompanied by adequate information and justification to the appropriate FTA regional office.

    8. Metropolitan Planning

      TEA-21 retains much of the basic structure of the metropolitan and statewide planning process, as established by ISTEA, with a few significant changes. The set of sixteen metropolitan planning factors has been reduced to seven factors: economic vitality; safety and security; accessibility and mobility; environment, energy conservation and quality of life; integration and connectivity; efficient operation and management; and preservation of existing transportation resources. Freight shippers and users of public transit are added to the explicit set of stakeholders to be given opportunities to comment on metropolitan plans and transportation improvement programs (TIPs).

      Metropolitan planning organizations (MPOs) may include in their TIPs an ``illustrative'' list of projects that could be implemented if additional resources were made available. MPOs will also be encouraged to coordinate the planning for Federally-funded non-emergency transportation services as part of the metropolitan planning process. FTA and FHWA will be revising the Joint Planning Regulations (23 CFR part 450 and 49 CFR part 613) to formally

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      incorporate changes to the planning program.

  10. New Starts Evaluation and Criteria

    TEA-21 includes several changes to the evaluation process and criteria for New Starts fixed guideway projects. The Secretary shall consider several additional factors in the Department's review and evaluation of candidate New Starts projects. FTA will be required to evaluate each project authorized for New Starts funding by each criterion, as well as provide an overall project rating of ``highly recommended,'' ``recommended,'' and ``not recommended.'' In addition to its annual report to Congress on Funding Levels and Allocations of Funds for Transit Major Capital Investments, FTA will be required to issue a supplemental report in August of each year which rates all projects that have completed alternatives analysis and preliminary engineering since the date of the last report. FTA must also approve candidate New Starts project's entry into final design. FTA also continues its prior approval authority for entrance into preliminary engineering.

    TEA-21 requires that no less than 92 percent of the annual New Starts program must be used for final design and construction.

    FTA will issue regulations implementing the New Starts provision of TEA-21.

  11. New Programs Authorized by TEA-21

    1. Clean Fuels Formula Program

      1. Definition and Eligible Projects

      The Clean Fuels Formula Program will finance the purchase or lease of clean fuel buses and facilities and the improvement of existing facilities to accommodate clean fuel buses. Clean fuel buses include those powered by compressed natural gas, liquefied natural gas, biodiesel fuels, batteries, alchohol-based fuels, hybrid electric, fuel cell and certain clean diesel, and other low or zero emissions technology, and which the Environmental Protection Agency (EPA) has certified sufficiently reduces harmful emissions. Eligible projects include:

      1. purchasing or leasing clean fuel buses, including buses that employ a lightweight composite primary structure;

      2. constructing or leasing clean fuel buses or electrical recharging facilities and related equipment;

      3. improving existing mass transportation facilities to accommodate clean fuel buses;

      4. repowering pre-1993 engines with clean fuel technology that meets the current urban bus emission standards;

      5. retrofitting or rebuilding pre-1993 engines if before half life to rebuild; and may,

      6. at the discretion of the FTA, projects relating to clean fuel, biodiesel, hybrid electric or zero emissions technology vehicles that exhibit equivalent or superior emissions reductions to existing clean fuel or hybrid electric technologies. 2. Application and Apportionment Deadlines

        Any designated recipient seeking to apply for a grant under this section shall submit an application to FTA no later than January 1 of each fiscal year. No later than February 1 of each fiscal year FTA shall apportion funds to designated recipients who submitted applications. FTA is required to issue regulations to implement this program. 3. Formula for Apportioning Funds

      7. Areas 1,000,000 and above. Two thirds of the funds available shall be apportioned to designated recipients with eligible projects in urban areas with a population of 1,000,000 and above. Of this, 50 percent shall be apportioned so that each designated recipient receives a grant in an amount equal to the ratio between:

        (1) the number of vehicles in the bus fleet of the eligible project, weighted by the severity of nonattainment for the area in which the eligible project is located; and

        (2) the total number of vehicles in the bus fleets of all eligible projects in areas with a population of 1,000,000 and above funded, weighted by the severity of nonattainment for all areas in which those eligible projects are located as provided in c. below. The remaining 50 percent shall be apportioned such that each designated recipient receives a grant in an amount equal to the ratio between:

        (a) the number of bus passenger miles of the eligible project of the designated recipient, weighted by the severity of nonattainment of the area in which the eligible project is located as provided in c. below.

        (b) the total number of bus passenger miles of all eligible projects in areas with a population of 1,000,000 and above funded, weighted by the severity of nonattainment of all areas in which those eligible projects are located as provided in c. below.

      8. Areas under 1,000,000 Population. The formula for areas under 1,000,000 is the same as for areas 1,000,000 and above, except that in areas 1,000,000 and above the formula uses a pool of all eligible projects in areas with a population of 1,000,000 and above and the formula for areas under 1,000,000 uses a pool of all eligible project for areas under 1,000,000.

      9. Weighting Factors. The number of clean fuel vehicles in the fleet or the number of passenger miles shall be multiplied by a factor of:

        (1) 1.0 if, at the time of the apportionment, the area is a maintenance area for ozone or carbon monoxide;

        (2) 1.1 if, at the time of the apportionment, the area is classified as a marginal ozone nonattainment area or a marginal carbon monoxide nonattainment area;

        (3) 1.2 if, at the time of the apportionment, the area is classified as a moderate ozone nonattainment area or a moderate carbon monoxide nonattainment area;

        (4) 1.3 if, at the time of the apportionment, the area is classified as a serious ozone nonattainment area or a serious carbon monoxide nonattainment area;

        (5) 1.4 if, at the time of the apportionment, the area is classified as a severe ozone nonattainment area or a severe carbon monoxide nonattainment area;

        (6) 1.5 if, at the time of the apportionment, the area is classified as an extreme ozone nonattainment area or an extreme carbon monoxide nonattainment area;

        (7) The fleet and passenger miles for an eligible project shall also be multiplied by a factor of 1.2 in those areas that are both nonattainment for carbon monoxide and are also classified as nonattainment or maintenance for ozone.

        Note: Certain of the carbon monoxide categories are inconsistent with the categories established by the Clean Air Act, as amended.

      10. Limitation on Use of Funds and Maximum Grant Amounts. The amount of a grant to a designated recipient shall not exceed the lesser of $15,000,000 in areas under 1,000,000 population, or $25,000,000 in areas with a population of 1,000,000 and above, or 80 percent of the total project cost.

        No more than $50,000,000 of the amount made available each year may be available to fund clean diesel buses.

        No more than five percent of the amount made available may be available to fund retrofitting or replacement of the engines of buses that do not meet the clean air standards of the EPA.

        At least five percent of the total program funding must be used for the

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        purchase or construction of hybrid electric or battery-powered buses or facilities designed to service those buses. 4. Availability of Funds

        TEA-21 authorizes $200,000,000 each year for the Clean Fuels Formula Program. However, only $100,000,000 each year is within the guaranteed funding level. Any amount made available shall remain available to a project for one year after the fiscal year for which the amount is made available and any funds that remain unobligated at the end of the second fiscal year shall be added to the amount made available in the following fiscal year.

        FTA will issue guidance and application instructions for this program.

    2. Job Access and Reverse Commute Program

      1. Definition and Eligible Projects

      The Job Access and Reverse Commute Program, to develop additional transportation services needed to connect welfare recipients and other low income persons to jobs and needed support services, is authorized at $150 million annually. However, the amounts under the guaranteed funding level start at $50 million in fiscal year 1999 and increases to $150 million in fiscal year 2003.

      A Job Access project is a project designed to transport welfare recipients and eligible low-income individuals to and from jobs and activities related to their employment. The grants may finance capital projects and operating cost of equipment, facilities, and associated capital maintenance items related to providing access to jobs; promote the use of transit by workers with nontraditional work schedules; promote the use by appropriate agencies of transit vouchers for welfare recipients and eligible low-income individuals; and promote the use of employer provided transportation, including the transit pass benefit program under section 132 of the Internal Revenue Code of 1986.

      A Reverse Commute project is a project related to the development of transportation services designed to transport residents from urban areas, urbanized areas and nonurbanized areas to suburban employment opportunities. Eligible projects include projects which subsidize the costs associated with adding reverse commute bus, train, carpool, van routes or service from urbanized and nonurbanized areas to suburban work places; subsidize the purchase or lease by a nonprofit organization or public agency of a bus or bus dedicated to shuttling employees from their residences to a suburban work place; or otherwise facilitate the provision of mass transportation services to suburban employment opportunities. Planning and coordination are not eligible activities under this program. 2. Factors for Consideration

      There will be a competitive grant selection process and TEA-21 contains specific factors for consideration in awarding grants under this program. Factors include:

      1. The percentage of the population in the area to be served by the applicant that are welfare recipients;

      2. The need for additional transportation services in the area to be served;

      3. The extent to which the applicant demonstrates:

        (1) Coordination with and the financial commitment of existing transportation service providers; and

        (2) Coordination with the State agency that administers the State program funded under part A of Title IV of the Social Security Act;

      4. Maximum utilization of existing transportation service providers and expanded transit networks or hours of service,

      5. Innovative approach that is responsive to identified service needs;

      6. The extent to which the applicant for a Job Access project:

        (1) Presents a regional transportation plan for addressing the transportation needs of welfare recipients and eligible low income individuals, and

        (2) Identifies long-term financing strategies to support the services;

      7. The extent to which the applicant demonstrates that the community to be served has been consulted in the planning process; and

      8. For Reverse Commute projects, the need for additional services identified in a regional transportation plan to transport individuals to suburban employment opportunities and the extent to which the proposed services will address these needs. 3. Availability of Funds and Grant Requirements

        Of the funds made available under this program, 60 percent shall be allocated for eligible projects in urbanized areas with populations of 200,000 and above. Twenty percent shall be allocated for eligible projects in urbanized areas with populations under 200,000. Twenty percent shall be allocated for eligible projects in nonurbanized areas.

        The program has a 50 percent federal share. Certain other Federal funds may be used to meet the 50 percent local match requirement. The requirements of Section 5307, the Urbanized Area Formula Program, apply to these grants. All planning requirements apply to these grants.

        FTA will issue further guidance and application instructions for this program.

    3. Over-the-Road Bus Accessibility Program

      TEA-21 establishes the Rural Transportation Accessibility Incentive Program, hereinafter referred to as the Over-the-Road Bus Accessibility Program. This program is designed to assist operators of over-the-road buses to finance the incremental capital and training costs of complying with the Department of Transportation's anticipated final rule regarding accessibility of over-the-road buses required by the Americans with Disabilities Act.

      Beginning in fiscal year 1999, funding will be available for operators of over-the-road buses in intercity fixed route service, starting with $2 million in fiscal year 1999 and increasing to $5.25 million in fiscal year 2003. In addition, beginning in fiscal year 2000, an additional $6.8 million each year will also be available for operators of other over-the-road bus service, including local commuter service and charter or tour service. Total funding authorized through fiscal year 2003 is $17,500,000 for fixed route over-the-road bus operators and $27,200,000 for operators of other over-the road bus services. (Note: The pending technical correction bill decreases the $6.8 million a year for operators of other over-the-road service to a total of $6.8 million for the four years, fiscal years 2000-2003.)

      TEA-21 directs FTA to conduct a national solicitation for applications. FTA must select the recipients of grants on a competitive basis, considering the following criteria:

      1. The identified need for over-the-road bus accessibility for persons with disabilities in the areas served by the operator;

      2. The extent to which the applicant demonstrates innovative strategies and financial commitment to providing access to over-the- road buses to persons with disabilities;

      3. The extent to which the over-the-road bus operator acquires equipment required by the final rule prior to any required timeframe in the final rule;

      4. The extent to which financing the costs of complying with the DOT's final rule regarding accessibility of over-the-

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        road buses presents a financial hardship for the applicant; and

      5. The impact of accessibility requirements on the continuation of over-the-road bus service, with particular consideration of the impact of the requirements on service to rural areas and for low-income individuals.

        The Federal share shall not exceed 50 percent of the project cost. The grants under this new program will be subject to all of the terms and conditions applicable to intercity bus operators assisted under the nonurbanized formula program and any other terms and conditions FTA prescribes.

        FTA will issue implementing guidance.

    4. Single State Pilot Program for Intercity Rail Infrastructure Investment

      TEA-21 establishes a pilot program to determine the benefits of using transit funds to support intercity passenger rail service in the State of Oklahoma. Any assistance provided to the State of Oklahoma under Sections 5307 and 5311 during fiscal years 1998-2003 may be used for capital improvements to, and operating assistance for, intercity passenger rail service. The Secretary must submit to the House Transportation and Infrastructure Committee and Senate Banking, Housing and Urban Affairs Committee by October 1, 2002, a report which evaluates the pilot program. The evaluation must address the effect of the pilot program on alternative forms of transportation within the State, the effects on operators of mass transportation and their passengers; a calculation of the amount of Federal assistance provided for intercity passenger rail service; and an estimate of the benefits to intercity passenger rail service.

    5. State Infrastructure Banks Pilot Program

      The State Infrastructure Bank program was first authorized as a pilot program under the National Highway System Designation Act of 1995. TEA-21 provides for a revised pilot program in four states, California, Florida, Missouri and Rhode Island. These four states may enter into new or revised cooperative agreements that specify procedures and guidelines for establishing, operating and providing assistance from the infrastructure bank. These four states may capitalize the infrastructure bank with funds from Section 5307, 5310 and 5311 as well as with Federal highway funds. There is no limitation on the amount of Federal funds that may be used to capitalize the bank as there was under the original pilot program.

      TEA-21 specifies that the requirements of Titles 23 and 49, United States Code, shall apply to repayments from non-Federal sources to an infrastructure bank from projects assisted by the bank. Such repayment shall be considered to be Federal funds. Repayments from Federal sources will also be subject to the requirements of Titles 23 and 49. In addition, for transit projects, the requirements for Sections 5307 and 5309 projects will apply.

  12. General Information

    For technical assistance purposes, the Fiscal Years 1998-2003 Apportionment Formula for Sections 5307 and 5311 are contained in Table 8. Table 9 displays the FTA Fiscal Years 1998-2003 Apportionment Formula for the Section 5309 Fixed Guideway Modernization Funding. The FTA Fiscal Years 1999-2003 Apportionment Formula for the Section 5308 Clean Fuels Formula Program is shown on Table 10. Displayed on Table 11 are the dollar unit values of data derived from the computations of the fiscal year 1998 revised Urbanized Area Formula Apportionment and the Fixed Guideway Modernization Apportionment.

    This Notice is included on the FTA Home Page and may be accessed at www.fta.dot.gov.

    Issued on: June 18, 1998. Gordon J. Linton, Administrator.

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    [FR Doc. 98-16698Filed6-23-98; 8:45 am]

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