# Presentation: 866181

## SAFETEA-LU 6004 – State Assumption of Responsibilities for CEsMay 2, 2006

**Notes:**
This powerpoint presentation summarizes information presented in the guidance issued on April 4, 2006. Please refer to the template MOU, MOU guidance, FHWA Questions and Answers on the implementation of SAFETEA-LU Section 6004, and the MOU Federal Register template. 

This guidance was prepared by a FHWA work group composed of individuals from Division Offices, the Resource Center, the Office of Chief Counsel, and the Office of Project Development and Project Review over a period of 8 months. Early drafts of the template MOU and and ideas about guidance were shared among representatives from Federal resource agencies. We also met with representatives from the Council on Environmental Quality on several occasions to share drafts of the MOU and to take their comments. Finally, I would like to express my thanks to the AASHTO delegation work group, who also participated in reviewing and commenting on early drafts of the template MOU. The AASHTO comments allowed us to refine and clarify portions of the MOU that were confusing or where unintended consequences may have resulted. 

## CE Responsibilities AssignableExisting PAs & the Template MOUWhere FHWA Fits InQuestions

**Notes:**
Today’s presentation is divided into two primary parts. This power point presentation is the first part and it covers three things (1) CE responsibilities that are assignable, (2) what happens with existing programmatic agreements while the new CE MOU is in force, and (3) the role the FHWA Division Office has once the MOU is  executed. I’ll try to complete this presentation in 45 minutes or less. 

I’d like to complete the power point presentation before taking questions, for the remaining 45 minutes of this teleconference. I’d appreciate it if you would note down your questions during the various points of this presentation and hold them till the end, when I will ask for questions. At that point I will allow each division to to ask one question until all those participating have had a chance to ask a question. After that I will take additional questions as time allows.  

## CE Responsibilities Assignable Part 1

- Assume responsibility for determining whether certain “designated activities” are CEs.
- Activities must be “specifically designated”
- Designation must be made in accordance with established criteria
- A list must be identified in the MOU
- Designation cannot be “open ended”

**Notes:**
According to the language of SAFETEA-LU Section 6004, FHWA may assign and the State DOT may assume responsibility for determining whether certain designated activities are CEs. This means that responsibilities for all CEs cannot be assigned to SDOTs. Rather, the activities must be specifically designated. And, according to SAFETEA LU, the designation must be made in accordance with established criteria, i.e. activities that do not individually or cumulatively have a significant effect on the human environment.

We implement this by listing the activities in the MOU for which the SDOT may make CE determinations. So, in practice, the assignment of CE responsibilities is not open ended and necessarily leave some activities that are CEs not assigned to the State. 

## Identify “Designated Activities”

- Easy: use the the activities already designated in regulation [23 CFR 771.117(c) and (d)]
- Next Easy: use the activities identified in an existing programmatic CE agreement
- Or, identify activities that may be demonstrated to be CEs

**Notes:**
Here’s how you might identify the designated activities in your own MOU:

The easiest way is for the Division Office to simply identify the activities already designated in FHWA’s regulation (23 CFR 771.117(c) and (d) list of examples). 

The next easiest step is for the Division Office to identify the activities that already have been listed in an existing programmatic CE agreement. This list likely already incorporated those designated in regulation.

Finally, the Division Office may identify activities that have been demonstrated to be CEs based on their documented experience. 

## Notice and Coordination

- MOU is subject to public notice and comment, if activities from PA are in MOU, disclose in public notice
- Draft MOU coordination w/ FHWA HCC & HQ
- HQ will coordinate MOU with CEQ to satisfy 40 CFR 1507.3
- Division must supply documentation on CEs if other than 771.117(c) or (d)

**Notes:**
There is an overall requirement for public notice and coordination for the draft MOU. Specifically regarding the responsibility for designating activities as CEs, the public notice needs to clearly disclose those activities (the Federal Register notice template may be of use in this regard). 

Part of the requirements in drafting the MOU is coordination with the Office of Chief Counsel and the headquarters office.  In particular the coordination with headquarters must include any documentation on activities to be designated as CEs for activities other than those listed in 771.117(c) and (d). FHWA headquarters will then submit the draft MOU and the documentation to the Council on Environmental Quality in compliance with regulatory requirement for consultation with CEQ. The CEQ has said they will respond within 30 days. 

## CE Responsibilities Assignable Part 2

- All or part of the other FHWA responsibilities for environmental review may be assigned.
- Responsibilities  assigned is discretionary
- Realistically assess SDOT capabilities
- Responsibilities must be specified in the MOU
- Government-to-Government consultation with Indian Tribes cannot be assigned.
- Specify procedures in MOU to avoid entanglement of FHWA/State decision making

**Notes:**
In addition to the Division assigning responsibilities for making CE determinations, the Division may also assign responsibilities for all or part of the other FHWA responsibilities for environmental review for projects where the SDOT has made a CE determination. 

The assignment of these additional responsibilities is discretionary.The Division may assign only part of the other FHWA responsibilities based on a realistic assessment of SDOT capabilities and capacity. Any responsibilities assigned must be specified in the MOU and are disclosed in the public notices (see the Federal Register notice template). 

The one responsibility that is not assignable to the state is Government-to-Government consultation with Indian tribes. SDOTs may continue to assist FHWA in complying with its government-to-government responsibilities, including executing agreements with Tribes that formalize the consultation procedures.

Because it is possible for the Division Office to assign only part of the other FHWA responsibilities for environmental review for CE projects assigned to the State, the MOU must specify procedures to avoid entanglement of FHWA and State decision making. These procedures should clearly state that information about the results of environmental compliance made by FHWA flow freely to the State such that the State may complete its environmental review and approve the project. 

## Existing PAs and the MOU

- Programmatic CE Agreements
- MOU supercedes but PA remains in effect
- Some PA CEs will be excluded from MOU
- MOU may expand PA list of actions
- 3rd Party PAs (i.e., Section 106, Section 404)
- Must notify and negotiate with 3rd parties
- May need to amend PAs
- 3rd Parties may require new procedures

**Notes:**
Even before any guidance or a template MOU was drafted, people wanted to know what would happen to existing programmatic agreements. The answer depends on whether the PAs are limited only to FHWA and the SDOT (as in programmatic CE agreements) or are third parties also involved.

For programmatic CE agreements, since only FHWA and the SDOT are involved, the MOU would supercede the PA but remain in effect. Any CE projects that are excluded from the MOU may be processed under the PA. It also is possible that the CE projects listed in a PA may be expanded upon in the MOU if new activities for which there is documentation that they are CEs, are listed in the MOU. 

SDOT also have PAs for compliance with other environmental laws such as Section 106 or Section 404. If responsibilities for compliance with these laws is assigned to the State in the MOU, the SDOT and FHWA must notify any 3rd parties to their PAs and negotiate with them in order to decide whether or not handling a project assigned under the MOU may also be processed according to an existing 3-party PA. Because the third parties executed agreements with an understanding that FHWA would be involved and responsible, some 3rd parties may require that the PAs be amended or that new procedures be established. 

## MOU Monitoring Goals

- To ensure that the provisions of the MOU have been followed
- It is a basis for evaluating the SDOT performance prior to MOU renewal
- To address MOU performance problems (tied to comments or complaints) before a project is processed

**Notes:**
The Division Office has the responsibility for monitoring the State’s performance of the MOU’s provisions. The purpose of the monitoring is to achieve three goals:
It is to insure that the provisions of the MOU are followed by the State.
2. It serves as a basis for evaluating the State’s performance as a pre-condition for renewing the term of the MOU.
3. It allows the Division Office to address contacts, comments, or complaints it received about the State’s performance under the MOU, while the State is still processing the project, in order to address MOU performance problems. 

## MOU Monitoring

- The template MOU identifies minimum activities, each Division may add details
- Quarterly reports of CE determinations
- State reports of MOU performance (12-18 mo)
- State maintains files subject to FHWA inspection
- FHWA review of reports and records every 12 mo
- FHWA may conduct audits or other monitoring activities.

**Notes:**
The basic framework of how the MOU may be monitored is presented in the template MOU. Division Offices have the flexibility to adapt the approach to MOU monitoring to suit their particular circumstances.  For example, details of how the Division Office monitors their programmatic CE agreement may be incorporated into the monitoring provisions of the MOU. 

Minimally, the following monitoring activities are to be included in the MOU:
Quarterly reports of the CE determinations made by the State
2. State-prepared reports of MOU performance every 12 to 18 months
3. FHWA review of reports and records every 12 months
4. And any additional monitoring activities included in the MOU by the Division Office 

## Certification and Litigation

- States must waive their 11th Amendment sovereign immunity
- State’s attorney general either signs or appends letter to MOU
- State consents to intervention of FHWA in proceedings involving CEs assigned by MOU
- Divisions must submit draft MOU to HCC and HQ for review prior to execution.

**Notes:**
Because the assignment of these responsibilities also entail State assumption of legal liabilities (rather than the administrative tasks as in the programmatic CE agreements), States must certify that they may assume these responsibilities and liabilities. This begins with a waiver of the State’s 11th amendment sovereign immunity. This means that the State accepts the jurisdiction of the Federal court when they are acting under the provisions of the MOU. Such a waiver will likely entail State legislative action. 

Certification of this acceptance is required through either the signature of the State’s attorney general in the MOU, or the attachment of a letter form the attorney general making this certification. 

Because of the transfer of legal obligations entailed by this assignment, the draft MOU must be submitted to the Office of the Chief Counsel and to FHWA headquarters prior to execution. 

## Public Notice

- MOU execution, any amendment, or renewal requires public notice and opportunity for comment
- Publication in newspapers and FR is required
- CEQ will be provided with draft MOU and CE documentation for review and comment
- Strongly recommended to meet with partner agencies (local, state, Fed) and Indian Tribes

## CEs Outside the MOU andMOU Termination 

- CEs outside, or “excluded,” from the MOU, will follow pre-MOU process and FHWA approves
- FHWA based on problems identified during monitoring may “exclude” projects included by MOU, (30-day period triggered)
- SDOT & FHWA, or FHWA alone, may “terminate” a responsibility (30-day period triggered)
- SDOT, FHWA, or both may “terminate” MOU (30-day period triggered)

**Notes:**
It is important to note that the MOU will not be able to assign responsibilities for all CEs to the State. The State will implement the MOU by first sorting through its projects and deciding which ones are to be included or excluded from the MOU. Those projects excluded will be processed according to procedures in place prior to the execution of the MOU. FHWA will be responsible for and will approve those projects (that approval may be a programmatic approval if the State has a programmatic CE agreement). The Division Office may exclude a project from the MOU based on monitoring the State’s MOU performance. This might happen if the Division Office becomes aware of a problem from an outside source. The Division Office would then contact the State and discuss the issue with the State. If the problem is not resolved within a 30 day period, the Division Office may take the project responsibilities back, including final approval of the project. 

Termination relates to responsibilities assigned in the MOU or the entire MOU. Both the SDOT and FHWA must agree to terminate a responsibility. Or FHWA may terminate a responsibility without State agreement if FHWA finds the State has not adequately met the MOU requirements for that responsibility. This action also requires a 30 day period for the SDOT and FHWA to identify the problem and try to clarify and resolve the problem. This period also accommodates any actions to turn over of responsibilities from the State to the Division Office. The MOU may be terminated in its entirety based on a request by the State (for any reason), by FHWA (for non performance of the provisions of the MOU) or by mutual agreement. Again, a 30 day period is triggered that serves both to allow the problem to be clarified and resolved and, if not resolved, accommodates planning the transition in returning responsibilities to the Division Office. 

## Waiver of State’s 11th Amendment Right of Sovereign Immunity
Documentation in support of added CE activities not already on “c” or “d” lists
Emails from FHWA HCC and HQ okaying draft and confirming CEQ consultation
Published public notice, gathered and considered comments
Final MOU filed in docket or published

- Documentation in support of added CE activities not already on “c” or “d” lists
- Emails from FHWA HCC and HQ okaying draft and confirming CEQ consultation
- Published public notice, gathered and considered comments
- Final MOU filed in docket or published

**Template MOU Checklist**

**Notes:**
I’ve included a short check list for items needed in drafting a MOU:
A waiver of the State’s 11th amendment right of sovereign immunity
2. If activities that are not already listed in regulation as qualifying as CEs are included in the MOU, documentation in support of those activities must be gathered. This documentation should show that the activities do not individually or cumulatively result in a significant effect to the human environment. If those activities were previously part of a programmatic CE agreement, then a copy of that agreement any documentation related to the monitoring, auditing, or program review of that agreement would qualify as documentation. 
3. Emails from the Chief Counsel's office and from headquarters okaying the draft MOU and indicating the CEQ consultation is complete. 

Between the MOU is drafting and its execution you will need to have
-published public notice of the MOU availability and the 45-day period of comment
-gathered and considered the comments submitted and addressed them in the docket and, if necessary, in a revised MOU
-and finally, once signed, file the MOU in the docket or publish the MOU. 

## Where FHWA Fits In

- Best Streamline: not at all in project decision making (except for Tribal consultation), State is the decision maker
- FHWA is responsible for Monitoring MOU
- FHWA intervenes on a project only in 2 cases
- To address a concern raised in gov-to-gov consult
- To address a MOU performance issue brought to FHWA attention

**Notes:**
I’d like to close by sketching where the Division Office fits into this process of assigning CE responsibilities. The best streamline for addressing NEPA responsibilities is to have the State as the decision maker and  FHWA not be involved in project decision making (except where government-to-government consultation is necessary and concerns are identified). 

The Division Office is mainly involved by its monitoring the State’s performance of the MOU provisions. As a result of that monitoring, FHWA can involve itself in a specific project only in two cases: (1) to address a concern raised in government-to-government consultation or (2) to address some MOU perform issue that has been brought to FHWA attention.

## Questions?

## FHWA HQ Contacts:

- Owen Lindauer HEPE	202 366-2655
- Janet Myers 	HCC		202 366-2019