# Project Evaluation and Rating Process 

Section 5309(e) requires FTA to evaluate each proposed New Starts
project according to a set of criteria for project justification and
local financial commitment. As proposed projects proceed through the
stages of the planning and project development process, they are
evaluated against the full range of statutory criteria. Based on the
results of this evaluation and consistent with Section 5309(e)(6),
summary ratings of "Highly Recommended," "Recommended," or "Not
Recommended" are assigned to each proposed project. The results of these
evaluations are used as the basis for decisions regarding approval for
entry into preliminary engineering and final design, execution of an
FFGA, and annual funding recommendations to Congress. FTA relies on a
multiple-measure approach to assign these ratings, which are updated
throughout the preliminary engineering and final design processes as
information concerning costs, benefits, and impacts is refined. The data
used to evaluate and rate proposed projects are developed during the
project development process, and are collected annually for the
production of this report, as well as when individual project sponsors
request approval to enter preliminary engineering or final design, and
to receive an FFGA. The New Starts project evaluation criteria are in
addition to the general grant eligibility requirements that apply to all
FTA programs.

## The Criteria

The criteria under which proposed New Starts projects must be evaluated
are established by statute in Section 5309(e), and are included under 49
CFR Part 611. The Secretary of Transportation may approve a grant or
loan under the Section 5309 New Starts program only for projects that
are:

Based on the results of alternatives analysis and preliminary
engineering;

Justified based on a comprehensive review of mobility improvements,
environmental benefits, cost effectiveness, and operating efficiencies;
and

Supported by an acceptable degree of local financial commitment,
including evidence of stable and dependable financing sources to
construct, maintain, and operate the system or extension.

### Project Justification

As required by 49 CFR Part 611, project justification is evaluated based
on the following criteria:

Mobility improvements

Environmental benefits

Cost effectiveness

Operating efficiencies

Transit-supportive existing land use, policies and future patterns

Other factors

The first four criteria above are taken directly from statute. Although
land use factors are not specifically included among the project
justification criteria established by Section 5309(e)(1)(B), they are
referenced repeatedly among the "considerations" that Section 5309(e)(3)
directs FTA to take into account when evaluating project justification.
Because of this emphasis, found in both the Transportation Equity Act
for the 21^st^ Century (TEA-21) and the earlier Intermodal Surface
Transportation Efficiency Act of 1991 (ISTEA), FTA has established
criteria for evaluating the extent to which existing land use, policies
and future patterns are transit-supportive. Consistent with Section
5309(e)(3)(H), FTA also considers a variety of other factors when
evaluating project justification, to account for project benefits not
covered by the five criteria explicit in the law.

FTA uses the following measures for each of the project justification
criteria.

##### 

##### 

##### 

##### Table 1 -- Project Justification Criteria

+-------------------------------+--------------------------------------+
| **Criterion**                 | **Measure(s)**                       |
+-------------------------------+--------------------------------------+
| Mobility Improvements         | -   Normalized Travel Time Savings   |
|                               |     (Transportation System User      |
|                               |     Benefits per Project Passenger   |
|                               |     Mile)                            |
|                               |                                      |
|                               | -   Low-Income Households Served     |
|                               |                                      |
|                               | -   Employment Near Stations         |
+-------------------------------+--------------------------------------+
| Environmental Benefits        | -   Change in Regional Pollutant     |
|                               |     Emissions                        |
|                               |                                      |
|                               | -   Change in Regional Energy        |
|                               |     Consumption                      |
|                               |                                      |
|                               | -   EPA Air Quality Designation      |
+-------------------------------+--------------------------------------+
| Operating Efficiencies        | -   System Operating Cost per        |
|                               |     Passenger Mile                   |
+-------------------------------+--------------------------------------+
| Cost Effectiveness            | -   Incremental Cost per Hour of     |
|                               |     Transportation System User       |
|                               |     Benefit                          |
+-------------------------------+--------------------------------------+
| Transit Supportive Land Use   | -   Existing Land Use                |
| and Future Patterns           |                                      |
|                               | -   Transit Supportive Plans and     |
|                               |     Policies                         |
|                               |                                      |
|                               | -   Performance and Impacts of       |
|                               |     Policies                         |
+-------------------------------+--------------------------------------+
| Other Factors                 | -   Number of optional factors,      |
|                               |     including economic impact of the |
|                               |     project.                         |
+-------------------------------+--------------------------------------+

Significant among the project justification measures is the
transportation system user benefits measure, which is used in the
calculation of both project cost effectiveness and mobility
improvements. Transportation system user benefits are intended to
capture the broad set of benefits to transit riders -- including
reductions in walk times, wait times, ride times, and number of
transfers -- in terms of perceived savings in travel time. User benefits
are best described as "travel time benefits," and are referred to as
such throughout this report. The cost per hour of transportation system
user benefits is a preferable measure for cost effectiveness (as
compared to the former measure of cost per new rider), as it (1)
captures the benefits which accrue to all transit system users
(including existing transit riders); (2) better reflects the underlying
reason for ridership increases -- improvements in travel time; (3)
incorporates and considers the nature of the service being provided by
the candidate project (for example, the measure distinguishes the
benefits of long vs. short trips); and (4) does not penalize those
agencies which are already providing a high level of transit service in
a corridor for which a major capital investment is proposed.

### Local Financial Commitment

Section 5309(e)(1)(C) requires that proposed projects be supported by an
acceptable degree of local financial commitment, including evidence of
stable and dependable financing sources to construct, maintain and
operate the system or extension. The criteria for evaluation of the
local financial commitment to a proposed project are:

The proposed share of total project costs from sources other than the
New Starts section of Section 5309, including Federal formula and
flexible funds, the local match required by Federal law, and any
additional capital funding;

The stability and reliability of the proposed capital financing plan;
and

The ability of the sponsoring agency to fund operation and maintenance
of the entire transit system (including existing service) as planned,
once the guideway project is built.

## The Evaluation

As noted above, FTA evaluates proposed New Starts projects against the
full range of criteria for both project justification and local
financial commitment, using a multiple-measure method. Project
evaluation is an ongoing process; as proposed New Starts projects
proceed through the project development process, information concerning
costs, benefits, and impacts is refined, and the ratings are updated to
reflect new information. The ratings reported in this document were used
as part of the development of the President's FY 2005 Budget, and, like
all information contained in this report, are current for that purpose.

The rating process used in the FY 2005 evaluation process is the same as
the process followed for the President's FY 2004 Budget and is
documented in Appendix E of FTA's Reporting Instructions for the Section
5309 New Starts Criteria (June 2003). To assign overall project ratings
to each proposed New Starts project, FTA considers the individual
ratings for each of the project justification and local financial
commitment measures. FTA combines this information into summary
\"finance\" and \"project justification\" ratings for each candidate
New Starts project. For both project justification and finance,
individual measures and summary ratings are designated as \"High,"
\"Medium-High," \"Medium," \"Low-Medium," or \"Low.\"

For most of the project justification criteria, the proposed New Starts
project is evaluated against a baseline alternative. The baseline
alternative is best described as a set of improvements to the transit
system that are relatively low in cost and the "best that can be done"
to improve transit service in the corridor without major capital
investment for new infrastructure. Use of a baseline alternative for
comparison purposes results in a more realistic depiction of the
benefits of a significant capital investment. For purposes of project
evaluation and rating, a project sponsor and FTA must agree on the
definition of the baseline alternative for the proposed New Starts
investment.

FTA assigns a weight of 50 percent each to the cost effectiveness and
land use criteria in order to establish a summary project justification
rating. The table below presents the thresholds FTA uses for assigning a
*\"High," \"Medium-High," \"Medium," \"Low-Medium," or \"Low\"* cost
effectiveness rating for each project:

Table 2 - Cost Effectiveness Thresholds

  ----------------------------------- -----------------------------------
  High                                \$9.99 (per hour of user benefits)
                                      and under

  Medium-High                         \$10.00- \$12.99

  Medium                              \$13.00-\$19.99

  Low-Medium                          \$20.00-\$24.99

  Low                                 \$25.00 and over
  ----------------------------------- -----------------------------------

Table 3 summarizes the ratings applied to each of the factors considered
in FTA's evaluation of the transit supportive land use and future
patterns criterion. Note that as New Starts projects proceed through
development, FTA expects that affected jurisdictions and authorities
will make commensurate progress in the development and adoption of
transit supportive land use plans and policies.

***Table 3 Ratings*** ***Applied in*** ***Assessment of*** ***Land***
***Use*** ***Criterion***

+------------+---------+----------------------------------------------+
| **I.       |         |                                              |
| EXISTING   |         |                                              |
| LAND USE** |         |                                              |
+------------+---------+----------------------------------------------+
| ***a.      |         |                                              |
| Existing   |         |                                              |
| Land       |         |                                              |
| Use***     |         |                                              |
+------------+---------+----------------------------------------------+
| Phase of   | Land    |                                              |
| Project    | Use     |                                              |
| D          | Ass     |                                              |
| evelopment | essment |                                              |
|            | Ratings |                                              |
+------------+---------+----------------------------------------------+
| P          | HIGH    | Current levels of population, employment,    |
| reliminary |         | and other trip generators in station areas   |
| E          |         | are suffi­cient to support a major transit    |
| ngineering |         | investment. Most station areas are           |
| and Final  |         | pedestrian-friendly and fully accessible.    |
| Design     |         |                                              |
+------------+---------+----------------------------------------------+
|            | MEDIUM  | Current levels of population, employment,    |
|            |         | and other trip generators in station areas   |
|            |         | marginally support a major transit           |
|            |         | investment. Some sta­tion areas are           |
|            |         | pedestrian-friendly and accessi­ble.          |
|            |         | Significant growth must be realized.         |
+------------+---------+----------------------------------------------+
|            | LOW     | Current levels of population, employment,    |
|            |         | and other trip generators in station areas   |
|            |         | are inade­quate to support a major transit    |
|            |         | investment. Station areas are not            |
|            |         | pedestrian-friendly.                         |
+------------+---------+----------------------------------------------+
| Ratings    |         |                                              |
| based on   |         |                                              |
| assessment |         |                                              |
| of the     |         |                                              |
| following: |         |                                              |
|            |         |                                              |
| -          |         |                                              |
|   Existing |         |                                              |
|            |         |                                              |
|   corridor |         |                                              |
|     and    |         |                                              |
|            |         |                                              |
|    station |         |                                              |
|     area   |         |                                              |
|     de     |         |                                              |
| velopment; |         |                                              |
|            |         |                                              |
| -          |         |                                              |
|   Existing |         |                                              |
|            |         |                                              |
|   corridor |         |                                              |
|     and    |         |                                              |
|            |         |                                              |
|    station |         |                                              |
|     area   |         |                                              |
|     d      |         |                                              |
| evelopment |         |                                              |
|            |         |                                              |
| character; |         |                                              |
|            |         |                                              |
| -          |         |                                              |
|   Existing |         |                                              |
|            |         |                                              |
|    station |         |                                              |
|     area   |         |                                              |
|            |         |                                              |
| pedestrian |         |                                              |
|     f      |         |                                              |
| acilities, |         |                                              |
|            |         |                                              |
|  including |         |                                              |
|     access |         |                                              |
|     for    |         |                                              |
|            |         |                                              |
|    persons |         |                                              |
|     with   |         |                                              |
|     dis    |         |                                              |
| abilities; |         |                                              |
|     and    |         |                                              |
|            |         |                                              |
| -          |         |                                              |
|   Existing |         |                                              |
|            |         |                                              |
|   corridor |         |                                              |
|     and    |         |                                              |
|            |         |                                              |
|    station |         |                                              |
|     area   |         |                                              |
|            |         |                                              |
|    parking |         |                                              |
|            |         |                                              |
|    supply. |         |                                              |
+------------+---------+----------------------------------------------+
| **II.      |         |                                              |
| TRANSIT-   |         |                                              |
| SUPPORTIVE |         |                                              |
| PLANS AND  |         |                                              |
| POLICIES** |         |                                              |
+------------+---------+----------------------------------------------+
| ***a.      |         |                                              |
| Growth     |         |                                              |
| Man        |         |                                              |
| agement*** |         |                                              |
+------------+---------+----------------------------------------------+
| Phase of   | Land    |                                              |
| Project    | Use     |                                              |
| D          | Ass     |                                              |
| evelopment | essment |                                              |
|            | Ratings |                                              |
+------------+---------+----------------------------------------------+
| P          | HIGH    | Adopted and enforceable growth management    |
| reliminary |         | and land conservation policies are in place  |
| E          |         | throughout the region. Existing and planned  |
| ngineering |         | densities and market trends in the region    |
| and Final  |         | and corridor are strongly compatible with    |
| Design     |         | transit.                                     |
+------------+---------+----------------------------------------------+
|            | MEDIUM  | Significant progress has been made toward    |
|            |         | implementing growth management and land      |
|            |         | conservation policies. Strong policies may   |
|            |         | be adopted in some jurisdictions but not     |
|            |         | others, or only moderately enforceable       |
|            |         | policies (e.g., incentive-based) may be      |
|            |         | adopted region-wide. Existing and/or planned |
|            |         | densities and market trends are moderately   |
|            |         | compatible with transit.                     |
+------------+---------+----------------------------------------------+
|            | LOW     | Limited consideration has been given to      |
|            |         | implementing growth management and land      |
|            |         | conservation policies; adopted policies may  |
|            |         | be weak and apply to only a limited area.    |
|            |         | Existing and/or planned densities and market |
|            |         | trends are minimally or not supportive of    |
|            |         | transit.                                     |
+------------+---------+----------------------------------------------+
| Ratings    |         |                                              |
| based on   |         |                                              |
| assessment |         |                                              |
| of the     |         |                                              |
| following: |         |                                              |
|            |         |                                              |
| -   Con    |         |                                              |
| centration |         |                                              |
|     of     |         |                                              |
|     d      |         |                                              |
| evelopment |         |                                              |
|     around |         |                                              |
|     e      |         |                                              |
| stablished |         |                                              |
|            |         |                                              |
|   activity |         |                                              |
|            |         |                                              |
|    centers |         |                                              |
|     and    |         |                                              |
|            |         |                                              |
|   regional |         |                                              |
|            |         |                                              |
|   transit; |         |                                              |
|     and    |         |                                              |
|            |         |                                              |
| -   Land   |         |                                              |
|     co     |         |                                              |
| nservation |         |                                              |
|     and    |         |                                              |
|     m      |         |                                              |
| anagement. |         |                                              |
+------------+---------+----------------------------------------------+

TABLE 3 (Continued)

+--------------+--------+----------------------------------------------+
| **II.        |        |                                              |
| TRANSI       |        |                                              |
| T-SUPPORTIVE |        |                                              |
| PLANS AND    |        |                                              |
| POLICIES**   |        |                                              |
+--------------+--------+----------------------------------------------+
| ***b.        |        |                                              |
| Transi       |        |                                              |
| t-Supportive |        |                                              |
| Corridor     |        |                                              |
| Policies***  |        |                                              |
+--------------+--------+----------------------------------------------+
| Final Design | HIGH   | Conceptual plans for the corridor and        |
|              |        | station areas have been developed. Local     |
|              |        | jurisdictions have adopted or drafted        |
|              |        | revisions to compre­hensive and/or small area |
|              |        | plans in most or all station areas. Land use |
|              |        | patterns proposed in conceptual plans and    |
|              |        | local and institutional plan revisions are   |
|              |        | strongly supportive of a major transit       |
|              |        | investment.                                  |
+--------------+--------+----------------------------------------------+
|              | MEDIUM | Conceptual plans for the corridor and        |
|              |        | station areas have been developed. Local     |
|              |        | jurisdictions have initiated the process of  |
|              |        | revising compre­hensive and/or small area     |
|              |        | plans. Land use pat­terns proposed in         |
|              |        | conceptual plans and local and institutional |
|              |        | plan revisions are at least moderately       |
|              |        | supportive of a major transit investment.    |
+--------------+--------+----------------------------------------------+
|              | LOW    | Limited progress, to date, has been made     |
|              |        | toward developing station area conceptual    |
|              |        | plans or revising local comprehensive or     |
|              |        | small area plans. Existing station area land |
|              |        | uses identified in local comprehensive plans |
|              |        | are marginally or not transit-supportive.    |
+--------------+--------+----------------------------------------------+
| Preliminary  | HIGH   | Conceptual plans for the corridor and        |
| Engineering  |        | station areas have been developed.           |
|              |        | Discussions have been undertaken with local  |
|              |        | jurisdictions about revising comprehensive   |
|              |        | plans. Land use patterns proposed in         |
|              |        | conceptual plans for station areas (or in    |
|              |        | existing comprehensive plans and             |
|              |        | institutional master plans throughout the    |
|              |        | corri­dor) are strongly supportive of a major |
|              |        | transit investment.                          |
+--------------+--------+----------------------------------------------+
|              | MEDIUM | Conceptual plans for the corridor and        |
|              |        | station areas are being developed.           |
|              |        | Discussions have been undertaken with local  |
|              |        | jurisdictions about revising comprehensive   |
|              |        | plans. Land use pat­terns proposed in         |
|              |        | conceptual plans for station areas (or       |
|              |        | existing in local comprehensive plans and    |
|              |        | institutional master plans) are at least     |
|              |        | mod­erately supportive of a major transit     |
|              |        | investment.                                  |
+--------------+--------+----------------------------------------------+
|              | LOW    | Limited progress, to date, has been made     |
|              |        | toward developing station area conceptual    |
|              |        | plans or working with local jurisdictions to |
|              |        | revise comprehensive plans. Existing station |
|              |        | area land uses identified in local           |
|              |        | comprehen­sive plans are marginally or not    |
|              |        | transit-supportive.                          |
+--------------+--------+----------------------------------------------+
| Ratings      |        |                                              |
| based on     |        |                                              |
| assessment   |        |                                              |
| of the       |        |                                              |
| following:   |        |                                              |
|              |        |                                              |
| -   Plans    |        |                                              |
|     and      |        |                                              |
|     policies |        |                                              |
|     to       |        |                                              |
|     increase |        |                                              |
|     corridor |        |                                              |
|     and      |        |                                              |
|     station  |        |                                              |
|     area     |        |                                              |
|              |        |                                              |
| development; |        |                                              |
|              |        |                                              |
| -   Plans    |        |                                              |
|     and      |        |                                              |
|     policies |        |                                              |
|     to       |        |                                              |
|     enhance  |        |                                              |
|     tran     |        |                                              |
| sit-friendly |        |                                              |
|              |        |                                              |
|    character |        |                                              |
|     of       |        |                                              |
|     corridor |        |                                              |
|     and      |        |                                              |
|     station  |        |                                              |
|     area     |        |                                              |
|              |        |                                              |
| development; |        |                                              |
|              |        |                                              |
| -   Plans to |        |                                              |
|     improve  |        |                                              |
|              |        |                                              |
|   pedestrian |        |                                              |
|              |        |                                              |
|  facilities, |        |                                              |
|              |        |                                              |
|    including |        |                                              |
|              |        |                                              |
|   facilities |        |                                              |
|     for      |        |                                              |
|     persons  |        |                                              |
|     with     |        |                                              |
|     d        |        |                                              |
| isabilities; |        |                                              |
|     and      |        |                                              |
|              |        |                                              |
| -   Parking  |        |                                              |
|              |        |                                              |
|    policies. |        |                                              |
+--------------+--------+----------------------------------------------+

***TABLE 3 (Continued)***

+-------------+--------+----------------------------------------------+
| **II.       |        |                                              |
| TRANSIT     |        |                                              |
| -SUPPORTIVE |        |                                              |
| PLANS AND   |        |                                              |
| POLICIES**  |        |                                              |
+-------------+--------+----------------------------------------------+
| ***c.       |        |                                              |
| Supportive  |        |                                              |
| Zoning      |        |                                              |
| Regulations |        |                                              |
| Near        |        |                                              |
| Transit     |        |                                              |
| Stations*** |        |                                              |
+-------------+--------+----------------------------------------------+
| Final       | HIGH   | Local jurisdictions have adopted zoning      |
| Design      |        | changes that strongly support a major        |
|             |        | transit investment in most or all transit    |
|             |        | station areas.                               |
+-------------+--------+----------------------------------------------+
|             | MEDIUM | Local jurisdictions are in the process of    |
|             |        | adopting zoning changes that moderately or   |
|             |        | strongly support a major transit investment  |
|             |        | in most or all transit station areas.        |
|             |        | Alternatively: strongly transit-supportive   |
|             |        | zoning has been adopted in some station      |
|             |        | areas but not in others.                     |
+-------------+--------+----------------------------------------------+
|             | LOW    | No more than initial efforts have begun to   |
|             |        | pre­pare station area plans and related       |
|             |        | zoning. Existing station area zoning is      |
|             |        | marginally or not transit-supportive.        |
+-------------+--------+----------------------------------------------+
| Preliminary | HIGH   | A conceptual planning process is underway to |
| Engineering |        | recommend zoning changes for station areas.  |
|             |        | Conceptual plans and policies for station    |
|             |        | areas are recommending transit-supportive    |
|             |        | densities and design characteristics. Local  |
|             |        | jurisdictions have committed to examining    |
|             |        | and changing zoning regulations where        |
|             |        | necessary. Alterna­tively, a "high" rating    |
|             |        | can be assigned if existing zoning in most   |
|             |        | or all transit station areas is already      |
|             |        | strongly transit-supportive.                 |
+-------------+--------+----------------------------------------------+
|             | MEDIUM | A conceptual planning process is underway to |
|             |        | recommend zoning changes for station areas.  |
|             |        | Local jurisdictions are in the process of    |
|             |        | com­mitting to examining and changing zoning  |
|             |        | regulations where necessary. Alternatively,  |
|             |        | a "medium" rating can be assigned if         |
|             |        | existing zoning in most or all transit       |
|             |        | station areas is already moderately          |
|             |        | transit-supportive.                          |
+-------------+--------+----------------------------------------------+
|             | LOW    | Limited consideration has been given to      |
|             |        | pre­paring station area plans and related     |
|             |        | zoning. Existing station area zoning is      |
|             |        | marginally or not transit-supportive.        |
+-------------+--------+----------------------------------------------+
| Ratings     |        |                                              |
| based on    |        |                                              |
| assessment  |        |                                              |
| of the      |        |                                              |
| following:  |        |                                              |
|             |        |                                              |
| -   Zoning  |        |                                              |
|             |        |                                              |
|  ordinances |        |                                              |
|     that    |        |                                              |
|     support |        |                                              |
|             |        |                                              |
|   increased |        |                                              |
|             |        |                                              |
| development |        |                                              |
|     den­sity |        |                                              |
|     in      |        |                                              |
|     transit |        |                                              |
|     station |        |                                              |
|     areas;  |        |                                              |
|             |        |                                              |
| -   Zoning  |        |                                              |
|             |        |                                              |
|  ordinances |        |                                              |
|     that    |        |                                              |
|     enhance |        |                                              |
|     trans   |        |                                              |
| it-oriented |        |                                              |
|             |        |                                              |
|   character |        |                                              |
|     of      |        |                                              |
|     station |        |                                              |
|     area    |        |                                              |
|             |        |                                              |
| development |        |                                              |
|     and     |        |                                              |
|             |        |                                              |
|  pedestrian |        |                                              |
|     access; |        |                                              |
|     and     |        |                                              |
|             |        |                                              |
| -   Zoning  |        |                                              |
|             |        |                                              |
|  allowances |        |                                              |
|     for     |        |                                              |
|     reduced |        |                                              |
|     parking |        |                                              |
|     and     |        |                                              |
|     traffic |        |                                              |
|             |        |                                              |
| mitigation. |        |                                              |
+-------------+--------+----------------------------------------------+

***TABLE 3 (Continued)***

  -------------------- --------- -----------------------------------------------
  **II.                          
  TRANSIT-SUPPORTIVE             
  PLANS AND POLICIES**           

  ***d. Tools to                 
  Implement Land Use             
  Policies***                    

  Final Design         HIGH      Transit agencies and/or regional agencies are
                                 working proactively with local jurisdictions,
                                 developers, and the public to promote
                                 transit-supportive land use planning and
                                 station area development. The transit agency
                                 has estab­lished a joint development program and
                                 identi­fied development opportunities. Agencies
                                 have adopted effective regulatory and financial
                                 incentives to promote transit-oriented
                                 devel­opment. Public and private capital
                                 improve­ments are being programmed in the
                                 corridor and station areas which implement the
                                 local land use policies and which leverage the
                                 Federal investment in the proposed corridor.

                       MEDIUM    Transit agencies and/or regional agencies have
                                 conducted some outreach to promote
                                 transit-supportive land use planning and
                                 station area development. Regulatory and
                                 financial incen­tives to promote
                                 transit-oriented development are being
                                 developed, or have been adopted but are only
                                 moderately effective. Capital improvements are
                                 being identified that support station area land
                                 use plans and leverage the Federal investment
                                 in the proposed major tran­sit corridor.

                       LOW       Limited effort has been made to reach out to
                                 jurisdictions, developers, or the public to
                                 pro­mote transit-supportive land use planning;
                                 to identify regulatory and financial incentives
                                 to promote development; or to identify capital
                                 improvements.

  Preliminary          HIGH      Transit agencies and/or regional agencies are
  Engineering                    working proactively with local jurisdictions,
                                 developers, and the public to promote
                                 transit-supportive land use planning and
                                 station area development. Local agencies are
                                 making rec­ommendations for effective regulatory
                                 and financial incentives to promote
                                 transit-oriented development. Capital
                                 improvement programs are being developed that
                                 support station area land use plans and
                                 leverage the Federal invest­ment in the proposed
                                 major transit corridor.

                       MEDIUM    Transit agencies and/or regional agencies have
                                 conducted some outreach to promote
                                 transit-supportive land use planning and
                                 station area development. Agencies are
                                 investigating regulatory and financial
                                 incentives to promote transit-oriented
                                 development. Capital improvements are being
                                 identified that support station area land use
                                 plans and leverage the Federal investment in
                                 the proposed major tran­sit corridor.

                       LOW       Limited effort has been made to reach out to
                                 jurisdictions, developers, or the public to
                                 pro­mote transit-supportive land use planning;
                                 to identify regulatory and financial incentives
                                 to promote development; or to identify capital
                                 improvements.
  -------------------- --------- -----------------------------------------------

***TABLE 3 (Continued)***

+------------+--------+-----------------------------------------------+
| **II.      |        |                                               |
| TRANSIT-   |        |                                               |
| SUPPORTIVE |        |                                               |
| PLANS AND  |        |                                               |
| POLICIES** |        |                                               |
+------------+--------+-----------------------------------------------+
| ***d.      |        |                                               |
| Tools to   |        |                                               |
| Implement  |        |                                               |
| Land Use   |        |                                               |
| Policies   |        |                                               |
| (Con       |        |                                               |
| tinued)*** |        |                                               |
+------------+--------+-----------------------------------------------+
| Ratings    |        |                                               |
| based on   |        |                                               |
| assessment |        |                                               |
| of the     |        |                                               |
| following: |        |                                               |
|            |        |                                               |
| -          |        |                                               |
|   Outreach |        |                                               |
|     to     |        |                                               |
|            |        |                                               |
| government |        |                                               |
|            |        |                                               |
|   agencies |        |                                               |
|     and    |        |                                               |
|     the    |        |                                               |
|            |        |                                               |
|  community |        |                                               |
|     in     |        |                                               |
|            |        |                                               |
|    sup­port |        |                                               |
|     of     |        |                                               |
|     land   |        |                                               |
|     use    |        |                                               |
|            |        |                                               |
|  planning; |        |                                               |
|            |        |                                               |
| -          |        |                                               |
| Regulatory |        |                                               |
|     and    |        |                                               |
|            |        |                                               |
|  financial |        |                                               |
|            |        |                                               |
| incentives |        |                                               |
|     to     |        |                                               |
|            |        |                                               |
|    promote |        |                                               |
|            |        |                                               |
|   transit- |        |                                               |
| supportive |        |                                               |
|     de     |        |                                               |
| velopment; |        |                                               |
|     and    |        |                                               |
|            |        |                                               |
| -          |        |                                               |
|    Efforts |        |                                               |
|     to     |        |                                               |
|     engage |        |                                               |
|     the    |        |                                               |
|     d      |        |                                               |
| evelopment |        |                                               |
|            |        |                                               |
|  community |        |                                               |
|     in     |        |                                               |
|            |        |                                               |
|    station |        |                                               |
|     area   |        |                                               |
|            |        |                                               |
|   planning |        |                                               |
|     and    |        |                                               |
|            |        |                                               |
|   transit- |        |                                               |
| supportive |        |                                               |
|     de     |        |                                               |
| velopment. |        |                                               |
+------------+--------+-----------------------------------------------+
| **III.     |        |                                               |
| P          |        |                                               |
| ERFORMANCE |        |                                               |
| AND        |        |                                               |
| IMPACTS OF |        |                                               |
| LAND USE   |        |                                               |
| POLICIES** |        |                                               |
+------------+--------+-----------------------------------------------+
| ***a.      |        |                                               |
| P          |        |                                               |
| erformance |        |                                               |
| of Land    |        |                                               |
| Use        |        |                                               |
| P          |        |                                               |
| olicies*** |        |                                               |
+------------+--------+-----------------------------------------------+
| Final      | HIGH   | A significant number of development proposals |
| Design     |        | are being received for transit-supportive     |
|            |        | housing and employment in station areas.      |
|            |        | Sig­nificant amounts of transit-supportive     |
|            |        | devel­opment have occurred in other, existing  |
|            |        | transit corridors and station areas in the    |
|            |        | region.                                       |
+------------+--------+-----------------------------------------------+
|            | MEDIUM | Some development proposals are being received |
|            |        | for transit-supportive housing and employment |
|            |        | in station areas. Moderate amounts of         |
|            |        | transit-supportive development have occurred  |
|            |        | in other existing transit corri­dors and       |
|            |        | station areas in the region.                  |
+------------+--------+-----------------------------------------------+
|            | LOW    | A limited number of proposals for             |
|            |        | transit-sup­portive housing and employment     |
|            |        | development in the corridor are being         |
|            |        | received. Other existing transit corridors    |
|            |        | and station areas in the region lack          |
|            |        | significant examples of transit-supportive    |
|            |        | housing and employment development.           |
+------------+--------+-----------------------------------------------+
| P          | HIGH   | Transit-supportive housing and employment     |
| reliminary |        | development is occurring in the corridor.     |
| E          |        | Sig­nificant amounts of transit-supportive     |
| ngineering |        | devel­opment have occurred in other, existing  |
|            |        | transit corridors and station areas in the    |
|            |        | region.                                       |
+------------+--------+-----------------------------------------------+
|            | MEDIUM | Station locations have not been established   |
|            |        | with finality, and therefore, development     |
|            |        | would not be expected. Moderate amounts of    |
|            |        | transit-supportive housing and employment     |
|            |        | develop­ment have occurred in other, existing  |
|            |        | transit corridors and station areas in the    |
|            |        | region.                                       |
+------------+--------+-----------------------------------------------+
|            | LOW    | Other existing transit corridors and station  |
|            |        | areas in the region lack significant examples |
|            |        | of transit-supportive housing and employment  |
|            |        | development.                                  |
+------------+--------+-----------------------------------------------+
| Ratings    |        |                                               |
| based on   |        |                                               |
| assessment |        |                                               |
| of the     |        |                                               |
| following: |        |                                               |
|            |        |                                               |
| -   De     |        |                                               |
| monstrated |        |                                               |
|     cases  |        |                                               |
|     of     |        |                                               |
|     d      |        |                                               |
| evelopment |        |                                               |
|            |        |                                               |
|   affected |        |                                               |
|     by     |        |                                               |
|     transi |        |                                               |
| t-oriented |        |                                               |
|            |        |                                               |
|  policies; |        |                                               |
|     and    |        |                                               |
|            |        |                                               |
| -          |        |                                               |
|    Station |        |                                               |
|     area   |        |                                               |
|     d      |        |                                               |
| evelopment |        |                                               |
|            |        |                                               |
|  proposals |        |                                               |
|     and    |        |                                               |
|            |        |                                               |
|    status. |        |                                               |
+------------+--------+-----------------------------------------------+

***TABLE 3 (Continued)***

+----------+--------+-------------------------------------------------+
| **III.   |        |                                                 |
| PER      |        |                                                 |
| FORMANCE |        |                                                 |
| AND      |        |                                                 |
| IMPACTS  |        |                                                 |
| OF LAND  |        |                                                 |
| USE      |        |                                                 |
| PO       |        |                                                 |
| LICIES** |        |                                                 |
+----------+--------+-------------------------------------------------+
| ***b.    |        |                                                 |
| P        |        |                                                 |
| otential |        |                                                 |
| Impact   |        |                                                 |
| of       |        |                                                 |
| Transit  |        |                                                 |
| Project  |        |                                                 |
| on       |        |                                                 |
| Regional |        |                                                 |
| Land     |        |                                                 |
| Use***   |        |                                                 |
+----------+--------+-------------------------------------------------+
| Pre      | HIGH   | A significant amount of land in station areas   |
| liminary |        | is available for new development or             |
| Eng      |        | redevelop­ment at transit-supportive densities.  |
| ineering |        | Local plans, policies, and development          |
| and      |        | programs, as well as real estate market         |
| Final    |        | conditions, strongly support such development.  |
| Design   |        |                                                 |
+----------+--------+-------------------------------------------------+
|          | MEDIUM | A moderate amount of land in station areas is   |
|          |        | available for new development or redevelop­ment  |
|          |        | at transit-supportive densities. Local plans,   |
|          |        | policies, and development programs, as well as  |
|          |        | real estate market conditions, moder­ately       |
|          |        | support such development.                       |
+----------+--------+-------------------------------------------------+
|          | LOW    | Only a modest amount of land in station areas   |
|          |        | is available for new development or             |
|          |        | redevel­opment. Local plans, policies, and       |
|          |        | develop­ment programs, as well as real estate    |
|          |        | market conditions, provide marginal support for |
|          |        | new development in station areas.               |
+----------+--------+-------------------------------------------------+
| Ratings  |        |                                                 |
| based on |        |                                                 |
| as       |        |                                                 |
| sessment |        |                                                 |
| of the   |        |                                                 |
| fo       |        |                                                 |
| llowing: |        |                                                 |
|          |        |                                                 |
| -   Adap |        |                                                 |
| tability |        |                                                 |
|     of   |        |                                                 |
|          |        |                                                 |
|  station |        |                                                 |
|     area |        |                                                 |
|     land |        |                                                 |
|     for  |        |                                                 |
|     deve |        |                                                 |
| lopment; |        |                                                 |
|     and  |        |                                                 |
|          |        |                                                 |
| -        |        |                                                 |
| Corridor |        |                                                 |
|          |        |                                                 |
| economic |        |                                                 |
|     envi |        |                                                 |
| ronment. |        |                                                 |
+----------+--------+-------------------------------------------------+

In evaluating local financial commitment, the primary factors considered
are the measures for the proposed local share of capital costs and the
strength of the capital and operating financing plans. The evaluations
are based upon the certainty of the non-New Starts funding proposed in
the project's financial plans, the completeness of the financial plan,
and the financial capacity of the project sponsor to undertake the major
capital investment, and to operate and maintain the planned transit
system over a 20-year period. FTA designates the status of the funds
proposed in each financial plan as existing, committed, budgeted,
planned, uncertain or unspecified for the proposed major capital
investment and ongoing operations and maintenance costs of the planned
transit system.

FTA rates the capital and operating plan for each factor according to
the standards defined in Tables 4 and 5, respectively, on the following
pages.

***TABLE 4***

***FINANCIAL RATINGS: CAPITAL FINANCING COMMITMENTS***

+---------+---------+-----------+----------+----------+--------------+
|         | *       | **Medi    | **       | **Low-   | **Low**      |
|         | *High** | um-High** | Medium** | Medium** |              |
+=========+=========+===========+==========+==========+==============+
|         |         |           |          |          |              |
+---------+---------+-----------+----------+----------+--------------+
| **      | \-      | \-        | \-       | \-       | \- Average   |
| Current | Average | Average   | Average  | Average  | bus fleet    |
| capital | bus     | bus fleet | bus      | bus      | age 12 years |
| cond    | fleet   | age under | fleet    | fleet    | or more.     |
| ition** | age     | 6 years.  | age      | age      |              |
|         | under 6 |           | under 8  | under    | \- Bond      |
|         | years.  | \- Bond   | years.   | 12.      | ratings      |
|         |         | ratings   |          |          | below        |
|         | \- Bond | (if any)  | \- Bond  | \- Bond  | investment   |
|         | ratings | of A      | ratings  | ratings  | grade        |
|         | (if     | (Fitch/   | (if any) | (if any) |              |
|         | any) of | S&P       | of BBB   | of BBB   |              |
|         | AAA     | /Moody's) | (Fi      | (Fi      |              |
|         | (Fit    | or better | tch/S&P) | tch/S&P) |              |
|         | ch/S&P) |           | or Baa   | or Baa   |              |
|         | or Aaa  |           | (        | (        |              |
|         | (M      |           | Moody's) | Moody's) |              |
|         | oody's) |           | or       | or       |              |
|         | or      |           | better   | better   |              |
|         | better  |           |          |          |              |
+---------+---------+-----------+----------+----------+--------------+
| **      | Capital | Capital   | Capital  | Capital  | Capital plan |
| Complet | plan    | plan is   | plan is  | plan is  | is           |
| eness** | in      | complete, | c        | p        | incomplete.  |
|         | cludes: | i.e. it   | omplete, | artially | Missing some |
|         |         | includes: |          | c        | key          |
|         | \-      |           | i.e. it  | omplete, | components,  |
|         | 20-year | \-        | i        | i.e. it  | including    |
|         | cash    | 20-year   | ncludes: | i        | the 20-year  |
|         | flow    | cash flow |          | ncludes: | cash flow.   |
|         |         |           | \-       |          |              |
|         | \- All  | \- Key    | 20-year  | \-       |              |
|         | assu    | as        | cash     | 20-year  |              |
|         | mptions | sumptions | flow     | cash     |              |
|         | are     |           |          | flow     |              |
|         | clearly | \-        | \- Key   |          |              |
|         | ex      | Moderate  | ass      | \-       |              |
|         | plained | level of  | umptions | Missing  |              |
|         |         | detail    |          | other    |              |
|         | \- High |           | \-       | items of |              |
|         | level   | \- Fleet  | Missing  | su       |              |
|         | of      | M         | some     | pporting |              |
|         | detail, | anagement | exp      | docum    |              |
|         | in      | Plan      | lanatory | entation |              |
|         | cluding |           | details  | (i.e.    |              |
|         | his     | \-        |          | fleet    |              |
|         | torical | Se        | \- Fleet | ma       |              |
|         | info    | nsitivity | Ma       | nagement |              |
|         | rmation | Analysis  | nagement | plan,    |              |
|         |         |           | Plan     | key      |              |
|         | \-      |           |          | assu     |              |
|         | Fleet   |           |          | mptions) |              |
|         | Man     |           |          |          |              |
|         | agement |           |          |          |              |
|         | Plan    |           |          |          |              |
|         |         |           |          |          |              |
|         | \-      |           |          |          |              |
|         | Sens    |           |          |          |              |
|         | itivity |           |          |          |              |
|         | a       |           |          |          |              |
|         | nalysis |           |          |          |              |
+---------+---------+-----------+----------+----------+--------------+
| **Com   | For     | For final | For      | For      | For final    |
| mitment | final   | design -  | final    | final    | design -     |
| of      | d       | Over 75%  | design - | design   | Under 25% of |
| capital | esign - | of        | Over 50% | --       | Non-Section  |
| funds** | 100% of | No        | of       | Between  | 5309 New     |
|         | Non-    | n-Section | Non      | 25% and  | Starts Funds |
|         | Section | 5309 New  | -Section | 50% of   | are          |
|         | 5309    | Starts    | 5309 New | Non      | committed.   |
|         | New     | Funds are | Starts   | -Section | Not all      |
|         | Starts  | c         | Funds    | 5309 New | remaining    |
|         | Funds   | ommitted. | are      | Starts   | funds are    |
|         | are     | The       | co       | Funds    | budgeted.    |
|         | com     | remaining | mmitted. | are      |              |
|         | mitted. | funds are | The      | co       | For PE - The |
|         |         | budgeted. | r        | mmitted. | sponsor has  |
|         | For PE  |           | emaining | The      | not          |
|         | -- Over | For PE -- | funds    | r        | identified   |
|         | 50% of  | Over 25%  | are      | emaining | any          |
|         | Non-    | of        | b        | funds    | reasonable   |
|         | Section | No        | udgeted. | are      | funding      |
|         | 5309    | n-Section |          | b        | sources for  |
|         | New     | 5309 New  | For PE - | udgeted. | the          |
|         | Starts  | Starts    | No       |          | Non-Section  |
|         | Funds   | Funds are | Non      | For PE - | 5309 New     |
|         | are     | committed | -Section | No       | Starts       |
|         | co      | or        | 5309 New | Non      | funding      |
|         | mmitted | budgeted. | Starts   | -Section | share.       |
|         | or      | The       | Funds    | 5309 New |              |
|         | bu      | remaining | are      | Starts   |              |
|         | dgeted. | funds are | c        | funds    |              |
|         | The     | planned.  | ommitted | are      |              |
|         | re      |           | or       | co       |              |
|         | maining |           | b        | mmitted. |              |
|         | funds   |           | udgeted, | The      |              |
|         | are     |           | but the  | sponsor  |              |
|         | p       |           | sponsor  | has no   |              |
|         | lanned. |           | has a    | re       |              |
|         |         |           | re       | asonable |              |
|         |         |           | asonable | plan to  |              |
|         |         |           | plan to  | secure   |              |
|         |         |           | secure   | the      |              |
|         |         |           | all      | n        |              |
|         |         |           | needed   | ecessary |              |
|         |         |           | funding. | funding. |              |
+---------+---------+-----------+----------+----------+--------------+
| **      | The     | The       | For      | The      | The          |
| Capital | ap      | applicant | final    | a        | applicant    |
| funding | plicant | has       | design - | pplicant | has no       |
| cap     | has     | available | The      | has a    | reasonable   |
| acity** | access  | cash      | a        | re       | plan to      |
|         | to      | reserves, | pplicant | asonable | cover cost   |
|         | funds   | debt      | has      | plan to  | increases or |
|         | via     | capacity, | a        | cover    | funding      |
|         | add     | or        | vailable | only     | shortfalls.  |
|         | itional | a         | cash     | minor    |              |
|         | debt    | dditional | r        | (under   |              |
|         | ca      | funding   | eserves, | 10%)     |              |
|         | pacity, | co        | debt     | cost     |              |
|         | cash    | mmitments | c        | i        |              |
|         | re      | to cover  | apacity, | ncreases |              |
|         | serves, | cost      | or       | or       |              |
|         | or      | increases | ad       | funding  |              |
|         | other   | or        | ditional | sho      |              |
|         | co      | funding   | c        | rtfalls. |              |
|         | mmitted | s         | ommitted |          |              |
|         | funds   | hortfalls | funds to | For PE   |              |
|         | to      | equal to  | cover    | --The    |              |
|         | cover   | at least  | cost     | a        |              |
|         | cost    | 25% of    | i        | pplicant |              |
|         | in      | estimated | ncreases | has a    |              |
|         | creases | project   | or       | re       |              |
|         | or      | costs.    | funding  | asonable |              |
|         | funding |           | sh       | plan to  |              |
|         | sho     |           | ortfalls | cover    |              |
|         | rtfalls |           | equal to | cost     |              |
|         | equal   |           | at least | i        |              |
|         | to at   |           | 10% of   | ncreases |              |
|         | least   |           | e        | or       |              |
|         | 50% of  |           | stimated | funding  |              |
|         | es      |           | project  | sh       |              |
|         | timated |           | costs.   | ortfalls |              |
|         | project |           |          | equal to |              |
|         | costs.  |           | For PE - | at least |              |
|         |         |           | The      | 10% of   |              |
|         |         |           | a        | e        |              |
|         |         |           | pplicant | stimated |              |
|         |         |           | has a    | project  |              |
|         |         |           | re       | costs.   |              |
|         |         |           | asonable |          |              |
|         |         |           | plan to  |          |              |
|         |         |           | cover    |          |              |
|         |         |           | cost     |          |              |
|         |         |           | i        |          |              |
|         |         |           | ncreases |          |              |
|         |         |           | or       |          |              |
|         |         |           | funding  |          |              |
|         |         |           | sh       |          |              |
|         |         |           | ortfalls |          |              |
|         |         |           | equal to |          |              |
|         |         |           | at least |          |              |
|         |         |           | 25% of   |          |              |
|         |         |           | project  |          |              |
|         |         |           | costs.   |          |              |
+---------+---------+-----------+----------+----------+--------------+
| **Rea   | Fi      | Financial | F        | F        | Financial    |
| sonable | nancial | plan      | inancial | inancial | plan         |
| capital | plan    | contains  | plan     | plan     | contains     |
| p       | c       | con       | contains | contains | capital      |
| lanning | ontains | servative | capital  | op       | planning     |
| assump  | very    | capital   | planning | timistic | assumptions  |
| tions** | conse   | planning  | ass      | capital  | and cost     |
|         | rvative | as        | umptions | planning | estimates    |
|         | capital | sumptions | and cost | ass      | that are far |
|         | p       | and cost  | e        | umptions | more         |
|         | lanning | estimates | stimates | and cost | optimistic   |
|         | assu    | when      | that are | es       | than recent  |
|         | mptions | compared  | in line  | timates. | history      |
|         | and     | with      | with     |          | suggests.    |
|         | cost    | recent    | hi       |          |              |
|         | es      | h         | storical |          |              |
|         | timates | istorical | exp      |          |              |
|         | when    | ex        | erience. |          |              |
|         | c       | perience. |          |          |              |
|         | ompared |           |          |          |              |
|         | with    |           |          |          |              |
|         | recent  |           |          |          |              |
|         | his     |           |          |          |              |
|         | torical |           |          |          |              |
|         | expe    |           |          |          |              |
|         | rience. |           |          |          |              |
+---------+---------+-----------+----------+----------+--------------+

***TABLE 5***

FINANCIAL RATINGS: STABLE AND RELIABLE OPERATING REVENUE

+-----------+----------+-----------+------------+----------+----------+
|           | **High** | **Medi    | **Medium** | **Low-   | **Low**  |
|           |          | um-High** |            | Medium** |          |
+===========+==========+===========+============+==========+==========+
| **Current | \-       | \-        | \-         | \-       | \-       |
| Operating | Hi       | H         | Historical | Hi       | Hi       |
| Financial | storical | istorical | and actual | storical | storical |
| Co        | and      | and       | balanced   | and      | and      |
| ndition** | actual   | actual    | budgets.   | actual   | actual   |
|           | positive | balanced  | Any annual | cash     | cash     |
|           | cash     | budgets.  | cash flow  | flow     | flow     |
|           | flow. No | Any       | shortfalls | show     | show     |
|           | cash     | annual    | paid from  | several  | several  |
|           | flow     | cash flow | cash       | years of | years of |
|           | sho      | s         | reserves   | revenue  | revenue  |
|           | rtfalls. | hortfalls | or annual  | sho      | sho      |
|           |          | paid from | appro      | rtfalls. | rtfalls, |
|           | \-       | cash      | priations. | Any      | or       |
|           | Current  | reserves  |            | annual   | hi       |
|           | o        | or other  | \- Current | cash     | storical |
|           | perating | committed | operating  | flow     | inf      |
|           | ratio    | sources.  | ratio is   | sh       | ormation |
|           | e        |           | at least   | ortfalls | not      |
|           | xceeding | \-        | 1.2        | paid     | p        |
|           | 2.0      | Current   |            | from     | rovided. |
|           |          | operating | \- No      | short    |          |
|           | \- No    | ratio is  | service    | term     | \-       |
|           | service  | at least  | cutbacks   | bo       | Current  |
|           | cutbacks | 1.5       | or only    | rrowing. | o        |
|           | in       |           | minor      |          | perating |
|           | recent   | \- No     | service    | \-       | ratio is |
|           | years.   | service   | cutbacks   | Current  | less     |
|           |          | cutbacks  | in recent  | o        | than 1.0 |
|           |          | in recent | years      | perating |          |
|           |          | years.    |            | ratio is | \- Major |
|           |          |           |            | at least | Service  |
|           |          |           |            | 1.0      | cutbacks |
|           |          |           |            |          | in       |
|           |          |           |            | \- Major | recent   |
|           |          |           |            | Service  | years    |
|           |          |           |            | cutbacks |          |
|           |          |           |            | in       |          |
|           |          |           |            | recent   |          |
|           |          |           |            | years    |          |
+-----------+----------+-----------+------------+----------+----------+
| **Compl   | O        | Operating | Operating  | O        | O        |
| eteness** | perating | plan is   | plan is    | perating | perating |
|           | plan     | complete, | complete,  | plan is  | plan is  |
|           | i        | i         | including: | missing  | missing  |
|           | ncludes: | ncluding: |            | no key   | some key |
|           |          |           | \- -       | com      | com      |
|           | \- More  | \- More   | 20-year    | ponents, | ponents, |
|           | than 5   | than 5    | cash flow  | i.e.:    | i.e.:    |
|           | years of | years of  |            |          |          |
|           | hi       | h         | \- 5 years | \- - 3   | \- No    |
|           | storical | istorical | of         | years or | cash     |
|           | data     | data      | historical | less of  | flow     |
|           |          |           | data       | hi       |          |
|           | \-       | \-        |            | storical | \- No    |
|           | 20-year  | 20-year   | \- Key     | data     | hi       |
|           | cash     | cash flow | a          |          | storical |
|           | flow     |           | ssumptions | \-       | data     |
|           |          | \- Key    | identified | 20-year  |          |
|           | \- Key   | as        |            | cash     |          |
|           | ass      | sumptions | \- Missing | flow     |          |
|           | umptions | i         | some       |          |          |
|           | id       | dentified | e          | \-       |          |
|           | entified |           | xplanatory | Missing  |          |
|           |          | \-        | detail     | key      |          |
|           | \-       | Moderate  |            | ass      |          |
|           | E        | level of  |            | umptions |          |
|           | xtensive | detail    |            |          |          |
|           | level of |           |            |          |          |
|           | detail   |           |            |          |          |
+-----------+----------+-----------+------------+----------+----------+
| **C       | For      | For final | For final  | For      | For      |
| ommitment | final    | design -  | design --  | final    | final    |
| of O&M    | design - | Over 75%  | Over 50%   | design - | design - |
| Funds**   | 100% of  | of the    | of the     | Sponsor  | Sponsor  |
|           | the      | funds     | funds      | has      | has not  |
|           | funds    | needed to | needed to  | id       | yet      |
|           | needed   | operate   | operate    | entified | received |
|           | to       | and       | and        | re       | any      |
|           | operate  | maintain  | maintain   | asonable | funding  |
|           | and      | the       | the        | p        | com      |
|           | maintain | proposed  | proposed   | otential | mitments |
|           | the      | transit   | transit    | funding  | to fund  |
|           | proposed | project   | system are | sources, | transit  |
|           | transit  | are       | committed. | but has  | op       |
|           | project  | c         | The        | received | erations |
|           | are      | ommitted. | remaining  | less     | and      |
|           | co       | The       | funds are  | than 50% | mai      |
|           | mmitted. | remaining | budgeted.  | com      | ntenance |
|           |          | funds are |            | mitments | and has  |
|           | For PE   | budgeted. | For PE --  | to fund  | not      |
|           | -- Over  |           | While no   | transit  | id       |
|           | 75% of   | For PE -  | additional | op       | entified |
|           | the      | Over 50%  | O&M        | erations | any      |
|           | funds    | of the    | funding    | and      | re       |
|           | needed   | funds     | has been   | main     | asonable |
|           | to       | needed to | committed, | tenance. | plan for |
|           | operate  | operate   | a          |          | securing |
|           | and      | and       | reasonable | For PE - | funding  |
|           | maintain | maintain  | plan to    | Sponsor  | comm     |
|           | the      | the       | secure     | does not | itments. |
|           | proposed | proposed  | funding    | have a   |          |
|           | transit  | transit   | c          | re       | For PE - |
|           | project  | project   | ommitments | asonable | Sponsor  |
|           | are      | are       | has been   | plan to  | has not  |
|           | c        | committed | presented. | secure   | id       |
|           | ommitted | or        |            | O&M      | entified |
|           | or       | budgeted. |            | funding. | any      |
|           | b        | The       |            | No       | re       |
|           | udgeted. | remaining |            | uns      | asonable |
|           | The      | funds are |            | pecified | funding  |
|           | r        | planned.  |            | sources. | sources  |
|           | emaining |           |            |          | for the  |
|           | funds    |           |            |          | o        |
|           | are      |           |            |          | peration |
|           | planned. |           |            |          | and      |
|           |          |           |            |          | mai      |
|           |          |           |            |          | ntenance |
|           |          |           |            |          | of the   |
|           |          |           |            |          | proposed |
|           |          |           |            |          | project. |
+-----------+----------+-----------+------------+----------+----------+
| **O&M     | \-       | \-        | \-         | \-       | \-       |
| Funding   | P        | Projected | Projected  | P        | P        |
| C         | rojected | cash      | cash       | rojected | rojected |
| apacity** | cash     | balances, | balances,  | cash     | cash     |
|           | b        | reserve   | reserve    | b        | balances |
|           | alances, | accounts, | accounts,  | alances, | are      |
|           | reserve  | debt      | debt       | reserve  | insu     |
|           | a        | capacity  | capacity   | a        | fficient |
|           | ccounts, | or access | or access  | ccounts, | to       |
|           | debt     | to line   | to line of | debt     | maintain |
|           | capacity | of credit | credit     | capacity | balanced |
|           | or       | exceeding | exceeding  | or       | budgets. |
|           | access   | 25        | 12 percent | access   |          |
|           | to line  | percent   | of annual  | to line  |          |
|           | of       | of annual | operating  | of       |          |
|           | credit   | operating | expenses.  | credit   |          |
|           | e        | expenses. |            | are less |          |
|           | xceeding |           |            | than 8   |          |
|           | 50       |           |            | percent  |          |
|           | percent  |           |            | of       |          |
|           | of       |           |            | annual   |          |
|           | annual   |           |            | o        |          |
|           | o        |           |            | perating |          |
|           | perating |           |            | e        |          |
|           | e        |           |            | xpenses. |          |
|           | xpenses. |           |            |          |          |
+-----------+----------+-----------+------------+----------+----------+
| **        | The      | The       | The        | The      | The      |
| Operating | ass      | as        | a          | ass      | ass      |
| Planning  | umptions | sumptions | ssumptions | umptions | umptions |
| Assu      | su       | s         | supporting | su       | su       |
| mptions** | pporting | upporting | the        | pporting | pporting |
|           | the      | the       | operating  | the      | the      |
|           | o        | operating | and        | o        | o        |
|           | perating | and       | m          | perating | perating |
|           | and      | ma        | aintenance | and      | and      |
|           | mai      | intenance | cost       | mai      | mai      |
|           | ntenance | cost      | estimates  | ntenance | ntenance |
|           | cost     | estimates | and        | cost     | cost     |
|           | e        | and       | revenue    | e        | e        |
|           | stimates | revenue   | forecasts  | stimates | stimates |
|           | and      | forecasts | are        | and      | and      |
|           | revenue  | are       | consistent | revenue  | revenue  |
|           | f        | con       | with       | f        | f        |
|           | orecasts | servative | historical | orecasts | orecasts |
|           | are very | relative  | e          | are      | are far  |
|           | cons     | to        | xperience. | op       | more     |
|           | ervative | h         |            | timistic | op       |
|           | relative | istorical |            | relative | timistic |
|           | to       | ex        |            | to       | than     |
|           | hi       | perience. |            | hi       | hi       |
|           | storical |           |            | storical | storical |
|           | exp      |           |            | exp      | ex       |
|           | erience. |           |            | erience. | perience |
|           |          |           |            |          | suggests |
|           |          |           |            |          | is       |
|           |          |           |            |          | rea      |
|           |          |           |            |          | sonable. |
+-----------+----------+-----------+------------+----------+----------+

FTA also considers in its evaluation the percentage of capital costs to
be met with non-Section 5309 New Starts funding. This non-Section 5309
share is rated *"High," "Medium-High,"* *"Medium,"* or *"Low."*

The table below summarizes the ratings given for this factor:

**[New Starts Share (rounded)]{.underline}** **[Non-Section 5309 New
Starts Share (rounded)]{.underline} [Share Rating]{.underline}**

Less than 35 percent Greater than 65 percent High

Between 35 and 49 percent Between 51 and 65 percent Medium-High

Between 50 and 59 percent Between 41 and 50 percent Medium

60 percent or greater 40 percent or less Low

FTA first weighs the proposed non-New Starts share as 20 percent of the
summary financial rating; the strength and reliability of the capital
plan counts as 50 percent of the rating; and the strength and
reliability of the operating plan counts as 30 percent of the rating.
FTA may then adjust the rating according to a number of decision rules
summarized in Appendix E of FTA's Reporting Instructions for the Section
5309 New Starts Criteria. FTA continues to encourage project sponsors to
request a Federal New Starts funding share that is as low as possible.
The Conference Report that accompanied the FY 2002 Department of
Transportation Appropriations Act instructs \"FTA not to sign any new
full funding grant agreements after September 30, 2002 that have a
maximum Federal share of higher than 60 percent." Consequently, FTA has
established a number of decision rules to ensure that all
\"Recommended\" New Starts projects are consistent with a Congressional
request regarding the New Starts share. The result of these decision
rules is that projects seeking a Federal New Starts share over 60
percent of total costs are given a \"Low\" rating for local financial
commitment, regardless of the ratings received for the capital plan and
operating plan. This \"Low\" rating further results in a \"Not
Recommended\" overall project rating.

The rating process also accounts for a proposed project's stage of
development. Recognizing that it is not possible to achieve the same
level of detail or degree of certainty for projects in the early stages
of preliminary engineering as those nearing the end of final design and
contemplating an FFGA, FTA applies different rating standards at
different stages of project development. Thus, a project in final design
is expected to have all local funds committed and available to fund the
project in order to achieve a *"High"* rating for its capital financing
plan. In contrast, a project in preliminary engineering could be rated
*"High"* if all funds have been identified and committed, but some of
those funds are not yet available to the project. As projects move
through the development process, FTA expects increasing certainty with
regard to all project evaluation criteria, and the degree of difficulty
in obtaining a *"High"* rating increases.

## The Ratings

FTA assigns summary project justification ratings of *"High,"
"Medium-High," "Medium," "Low-Medium,"* or *"Low"* based on the ratings
applied to cost effectiveness and land use. The same rating scale is
used for the three factors considered to evaluate local financial
commitment. The individual criterion ratings are then combined into
overall finance and project justification ratings, which in turn are
combined to produce summary ratings of *"Highly Recommended,"
"Recommended,"* or *"Not Recommended."*

For a proposed project to be rated as *"Recommended,"* it must be rated
at least *"Medium"* for both finance and project justification. To be
*"Highly Recommended,"* a proposed project must be rated higher than
*"Medium"* for both finance and justification. Proposed projects not
rated at least *"Medium"* in both finance and project justification
receive an overall rating of *"Not Recommended."*

If a proposed project is rated as *"Not Recommended,"* FTA indicates the
area or areas that must be improved in order to improve the rating: "J"
for justification of the project, "O" for the operating funding plan, or
"C" for the capital funding plan. Thus, if a proposed project that is
found in need of improvement to its capital plan, it would be rated
*"Not Recommended* (C)." A project requiring attention in all three
areas would be rated *"Not Recommended (JOC)*." This provides project
sponsors, local, State, and Federal decision-makers, and the public at
large with a simple means to identify the basis for the rating.

These ratings are used both to approve entry into preliminary
engineering and final design, as required under Section 5309(e)(6), and
to recommend proposed projects for Federal funding commitments. A
proposed project must receive a rating of at least *"Recommended"* in
order to be approved for any of these purposes.

It is important to note that a rating of *"Recommended"* does not
translate directly into a funding recommendation in any given fiscal
year. Rather, the overall project ratings are intended to reflect
overall project merit at a given point in time. Proposed projects that
are rated *"Recommended"* or *"Highly Recommended,"* will be eligible
for multiyear funding recommendations in the President\'s proposed
budget only if other project readiness requirements have been met and
sufficient funds are available.

## FY 2005 Annual Report Ratings

The results of the project evaluation process are reported in Table 6.
Ratings are established only for proposed projects that are in
preliminary engineering and final design; projects undergoing
alternatives analysis typically have not developed sufficient
information for meaningful evaluation, since local decisions regarding
the preferred alternative and scope of the project are still pending.
Projects for which FFGAs have already been issued are not listed because
the decision to award an FFGA represents FTA's final determination on
project justification and local financial commitment.

As in previous reports, FTA has identified several projects as *"Not
Rated."* A *"Not Rated"* status generally indicates that FTA has serious
concerns about the information submitted for mobility improvements and
cost effectiveness because the underlying assumptions used by the
project sponsor may have produced an inaccurate representation of the
benefits of the project. Experience has shown that the principal source
of problems has been utilizing inconsistent assumptions in defining the
baseline alternative and the proposed New Starts project. These
inconsistencies have made it impossible to isolate the impacts of the
proposed project in terms of ridership, transportation benefits,
operating and maintenance costs, capital costs, and cost-effectiveness.
FTA will continue to work with project sponsors to validate assumptions,
information, and projections. A rating for these projects will be made
available to Congress and other interested parties when the issues are
resolved.

In addition, in a few cases, project information has not yet been
submitted by the project sponsor for FTA evaluation. These projects are
also "Not Rated," and their ratings will be made available to Congress
and other interested parties when information is submitted and the
project evaluation is complete.

Appendix A provides a more detailed profile for each project for which
an FFGA has been issued or a Federal funding commitment is pending, as
well as for projects in final design and preliminary engineering.
Profiles for projects with FFGAs include a description, status, list of
funding sources and map. Profiles for all non-exempt projects in final
design and preliminary engineering include a description of the
project's anticipated benefits, its status, a list of proposed funding
sources, a project map, and a presentation of the project evaluation
criteria and ratings. Each profile also includes a summary description
that highlights the overall project ratings and presents key
descriptive, cost, and ridership data for the proposed New Starts
project. Appendix B provides a brief description and status for other
planning studies and projects that have not yet entered preliminary
engineering, or which have been reported in last year's New Starts
report but have subsequently received all of their proposed New Starts
funding.

As noted earlier, project evaluation is an ongoing process. The ratings
contained in this report are based on project information available
through November 2003. As proposed New Starts proceed through the
project development process, the estimates of costs, benefits, and
impacts are refined. The FTA ratings and recommendations are updated
annually for purposes of this report, as well as at the time a request
is made to enter into preliminary engineering, final design, or an FFGA.
The *Annual Report on New Starts* provides a snapshot of each project in
development. In addition to providing information to Congress, it serves
as guidance to project sponsors, so that improvements can be made. Since
projects can be expected to continue to change as they progress through
the development process, the ratings for projects that are not yet
recommended for FFGAs should not be construed as a statement about the
ultimate merits of the project, but rather, an assessment of the
project's current strengths and weaknesses. It should be stressed,
however, that the ratings reported in this document are final for
purposes of the President's Fiscal Year 2005 Budget. Updated project
information and ratings will be reviewed as part of the budget
development process for the next fiscal year.

## Exemptions

Under Section 5309(e)(8)(A), proposed projects for which less than \$25
million in Section 5309 Federal New Starts funding is sought are exempt
from the project evaluation and rating process described above. Where
the sponsoring agency believes that a proposed project meets this
requirement, submission of project justification and financial
commitment information to FTA is not required. However, exempt projects
must still meet all planning, environmental, project management, and
other requirements that demonstrate their readiness to advance into
preliminary engineering and final design. FTA encourages sponsors of
exempt projects to develop justification and financial information. Such
information can be used to demonstrate project merit.