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[Federal Register: June 1, 2010 (Volume 75, Number 104)]
[Notices]               
[Page 30460-30480]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr01jn10-128]                         

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DEPARTMENT OF TRANSPORTATION

Office of the Secretary

[Docket No. DOT-OST-2010-0076]

 
Notice of Funding Availability for the Department of 
Transportation's National Infrastructure Investments Under the 
Transportation, Housing and Urban Development, and Related Agencies 
Appropriations Act for 2010

AGENCY: Office of the Secretary of Transportation, DOT.

ACTION: Notice of funding availability.

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SUMMARY: This notice announces the availability of funding and requests 
proposals for the Department of Transportation's National 
Infrastructure Investments. In addition, this notice announces 
selection criteria and pre-application and application requirements for 
the National Infrastructure Investments.
    On December 16, 2009, the President signed the Transportation, 
Housing and Urban Development, and Related Agencies Appropriations Act 
for 2010 (Div. A of the Consolidated Appropriations Act, 2010 (Pub. L. 
111-117, Dec. 16, 2009)) (``FY 2010 Appropriations Act''). The FY 2010 
Appropriations Act appropriated $600 million to be awarded by the 
Department of Transportation (``DOT'') for National Infrastructure 
Investments. This appropriation is similar, but not identical to the 
appropriation for the Transportation Investment Generating Economic 
Recovery, or ``TIGER Discretionary Grant'', program authorized and 
implemented pursuant to the American Recovery and Reinvestment Act of 
2009 (the ``Recovery Act''). Because of the similarity in program 
structure, DOT is referring to the grants for National Infrastructure 
Investments under the FY 2010 Appropriations Act as ``TIGER II 
Discretionary Grants''. As with the TIGER program, funds for the TIGER 
II program are to be awarded on a competitive basis for projects that 
will have a significant impact on the Nation, a metropolitan area or a 
region. Through this notice, DOT is soliciting applications for TIGER 
II Discretionary Grants.
    On April 26, 2010, DOT published an interim notice announcing the 
availability of funding for TIGER II Discretionary Grants. Because this 
is a new program, the interim notice also requested comments on the 
proposed selection criteria and guidance for awarding TIGER II 
Discretionary Grants. DOT considered the comments that were submitted 
in accordance with the interim notice and decided to publish this 
notice revising some elements of the interim notice. Each of the 
substantive revisions made in this notice are described below in 
``Supplemental Information.'' In the event that this solicitation does 
not result in the award and obligation of all available funds, DOT may 
decide to publish an additional solicitation.

DATES: Pre-applications must be submitted by July 16, 2010, at 5 p.m. 
EDT (the ``Pre-Application Deadline''). Final applications must be 
submitted through Grants.gov by August 23, 2010, at 5 p.m. EDT (the 
``Application Deadline''). The DOT pre-application system will open no 
later than June 23, 2010 to allow prospective applicants to submit pre-
applications. Subsequently, the Grants.gov ``Apply'' function will open 
on July 30, 2010, allowing applicants to submit applications. While 
applicants are encouraged to submit pre-applications in advance of the 
Pre-Application Deadline, pre-applications will not be reviewed until 
after the Pre-Application Deadline. Similarly, while applicants are 
encouraged to submit applications in advance of the Application 
Deadline, applications will not be evaluated, and awards will not be 
made, until after the Application Deadline. Pursuant to the FY 2010 
Appropriations Act, DOT will evaluate all applications and announce the

[[Page 30461]]

projects that have been selected to receive TIGER II Discretionary 
Grants no sooner than September 15, 2010.

ADDRESSES: Pre-applications must be submitted electronically to DOT and 
applications must be submitted electronically through Grants.gov. Only 
pre-applications received by DOT and applications received through 
Grants.gov will be deemed properly filed. Instructions for submitting 
pre-applications to DOT and applications through Grants.gov are 
included in Section VIII (Pre-Application and Application Cycle).

FOR FURTHER INFORMATION CONTACT: For further information concerning 
this notice please contact the TIGER II Discretionary Grant program 
manager via e-mail at TIGERIIGrants@dot.gov, or call Robert Mariner at 
202-366-8914. A TDD is available for individuals who are deaf or hard 
of hearing at 202-366-3993. In addition, DOT will regularly post 
answers to questions and requests for clarifications on DOT's Web site 
at http://www.dot.gov/recovery/ost/TIGERII.

SUPPLEMENTARY INFORMATION: On April 26, 2010, DOT published an interim 
notice announcing funding availability for the TIGER II Discretionary 
Grant program. Because this is a new program, the interim notice also 
requested comments on the proposed selection criteria and guidance for 
awarding TIGER II Discretionary Grants. DOT considered the comments 
that were submitted in accordance with the interim notice and decided 
to publish this notice revising some elements of the interim notice. 
Each of the substantive revisions made in this notice are described in 
the following numbered paragraphs.
    This notice revises the interim notice published on April 26, 2010, 
as follows:
    1. The notice is no longer an interim notice, and DOT is no longer 
considering comments on the proposed selection criteria and guidance 
for awarding TIGER II Discretionary Grants. This notice is the 
operative notice of funding availability for the TIGER II Discretionary 
Grant program.
    2. In the interim notice, DOT indicated that it was seeking 
comments on its intention to conduct a multi-agency evaluation and 
award process with the Department of Housing and Urban Development 
(``HUD'') for DOT's TIGER II Planning Grants (as defined below in the 
``Background'' section) and HUD's Community Challenge Planning Grants, 
which were also authorized under the FY 2010 Appropriations Act. DOT 
and HUD have considered the comments that were submitted and have 
agreed to conduct a multi-agency evaluation and award process for their 
respective planning grants. This approach is consistent with DOT and 
HUD's participation in the ``Partnership for Sustainable Communities'' 
with the U.S. Environmental Protection Agency (``EPA'') to help 
American families in all communities--rural, suburban and urban--gain 
better access to affordable housing, more transportation options, lower 
transportation costs, and a cleaner environment. The details of this 
multi-agency planning grant program, including information about 
eligibility, selection criteria, and pre-application and application 
requirements, are described in a joint notice of funding availability 
to be published in the Federal Register by DOT and HUD. The joint 
notice will be published shortly after this notice and signed by the 
Secretaries of each agency. Interested parties are encouraged to review 
the joint notice for more information. However, DOT applicants may 
request funding for planning and capital expenses for the same project 
under this notice.
    3. This notice provides additional guidance in the ``Background'' 
section about the matching funds required to satisfy the FY 2010 
Appropriations Act. DOT will consider any non-Federal funds as a local 
match for purposes of this program, whether such funds are contributed 
by the public sector (State or local) or the private sector. However, 
DOT will not consider funds already expended as a local match. 
Furthermore, the 20 percent matching requirement for project that are 
not in rural areas is an eligibility requirement. All projects, whether 
in an urban or rural area, can increase their competitiveness by 
demonstrating significant contributions in excess of the required local 
match, and DOT will give priority, based on the FY 2010 Appropriations 
Act, to projects for which Federal funding is required to complete an 
overall financing package.
    4. This notice clarifies the definition of ``rural area'' that DOT 
is using for purposes of the TIGER II Discretionary Grant program. The 
interim notice stated that DOT will consider a project to be in a rural 
area if ``all or a material portion of a project is located in a rural 
area''. This notice clarifies that DOT will only consider a material 
portion of a project to be located in a rural area if the majority of 
the project is located in a rural area. The reason this language was 
included in the notice was to ensure that rural transportation 
corridors could be considered to be in rural areas even if the 
corridors terminate in, or otherwise pass through, Urbanized Areas (as 
such term is defined by the Census Bureau). To the extent more than a 
de minimis portion of a project is located in an Urbanized Area, this 
notice asks applicants to identify the estimated percentage of project 
costs that will be spent in the Urbanized Area. This will allow DOT to 
appropriately account for the $140 million that the FY 2010 
Appropriations Act sets aside for rural areas. Also, this notice 
revises the footnote in Section V (Projects in Rural Areas) to clarify 
that rural areas include any area not in an Urbanized Area, as such 
term is defined by the Census Bureau, including Urban Clusters.
    5. This notice revises Section II(B)(1)(b)(ii) (Environmental 
Approvals) to provide additional guidance about the assurance that 
applicants should provide with their pre-applications to demonstrate 
that the project has received (or reasonably anticipates receipt of) 
all necessary environmental approvals required for the project to 
proceed rapidly upon receipt of a TIGER II Discretionary Grant.
    6. This notice revises the Economic Competitiveness criterion 
described in Section II(B)(1)(a)(ii) and the guidance for conducting a 
benefit-cost analysis provided in Appendix A to further clarify what 
the Department considers to be long-term economic benefits.
    This notice revises Section VI (TIGER II TIFIA Payments) to clarify 
that the correct amount of the TIFIA application fee is $50,000, not 
$30,000. Applicants do not need to submit this fee with their 
application for a TIGER II TIFIA Payment. However, if a project is 
selected for a TIGER II TIFIA Payment, the project sponsor will be 
invited to submit a TIFIA application, and will be required to pay the 
TIFIA application fee with submission of the TIFIA application. These 
substantive changes to the interim notice published on April 26, 2010, 
have been included in this notice. All comments received prior to the 
May 7, 2010, deadline were received and considered by DOT.

Table of Contents

I. Background
TIGER II Discretionary Grants
II. Selection Criteria and Guidance on Application of Selection 
Criteria
III. Evaluation and Selection Process
IV. Grant Administration
V. Projects in Rural Areas
VI. TIGER II TIFIA Payments
VII. TIGER II Planning Grants
Application Requirements
VIII. Pre-Application and Application Cycle
IX. Project Benefits
X. Questions and Clarifications
Appendix A: Additional Information on Cost Benefit Analysis

[[Page 30462]]

Appendix B: Additional Information on Applying Through Grants.gov

I. Background

Recovery Act TIGER Discretionary Grants

    On February 17, 2009, the President of the United States signed the 
Recovery Act, which appropriated $1.5 billion of discretionary grant 
funds to be awarded by DOT for capital investments in surface 
transportation infrastructure. DOT refers to these grants as Grants for 
Transportation Investment Generating Economic Recovery or ``TIGER 
Discretionary Grants''. DOT solicited applications for TIGER 
Discretionary Grants through a notice of funding availability published 
in the Federal Register on June 17, 2009 (an interim notice was 
published on May 18, 2009). Applications for TIGER Discretionary Grants 
were due on September 15, 2009 and DOT received over 1400 applications 
with funding requests totaling almost $60 billion. Funding for 51 
projects totaling nearly $1.5 billion was announced on February 17, 
2010. Grant announcements ranged from $3.15 million to $105 million for 
individual projects, with an average award size of approximately $30 
million and the median award amount being $22 million. Less than three 
percent of the applications (by dollar value) received any funding. 
Projects were selected for funding based on their alignment with the 
selection criteria specified in the June 17, 2009, Federal Register 
notice for the TIGER Discretionary Grant program.
    On December 16, 2009, the President signed the FY 2010 
Appropriations Act, which appropriated $600 million to DOT for National 
Infrastructure Investments using language that is similar, but not 
identical, to the language in the Recovery Act authorizing the TIGER 
Discretionary Grants. DOT is referring to the grants for National 
Infrastructure Investments as TIGER II Discretionary Grants.

TIGER II Discretionary Grants

    Like the TIGER Discretionary Grants, TIGER II Discretionary Grants 
are for capital investments in surface transportation infrastructure 
and are to be awarded on a competitive basis for projects that will 
have a significant impact on the Nation, a metropolitan area, or a 
region. Key requirements of the TIGER II Discretionary Grant program 
are summarized below, and material differences from the TIGER 
Discretionary Grant program are highlighted.
    ``Eligible Applicants'' for TIGER II Discretionary Grants are State 
and local governments, including U.S. territories, tribal governments, 
transit agencies, port authorities, metropolitan planning organizations 
(MPOs), other political subdivisions of State or local governments, and 
multi-State or multi-jurisdictional groups applying through a single 
lead applicant (for multi-jurisdictional groups, each member of the 
group, including the lead applicant, must be an otherwise eligible 
applicant as defined in this paragraph).
    Projects that are eligible for TIGER II Discretionary Grants under 
the FY 2010 Appropriations Act (``Eligible Projects'') include, but are 
not limited to: (1) Highway or bridge projects eligible under title 23, 
United States Code; (2) public transportation projects eligible under 
chapter 53 of title 49, United States Code; (3) passenger and freight 
rail transportation projects; and (4) port infrastructure investments. 
Federal wage rate requirements included in subchapter IV of chapter 31 
of title 40, United States Code, apply to all projects receiving funds. 
This description of Eligible Projects is, in practice, identical to the 
description of eligible projects under the TIGER Discretionary Grant 
program.\1\
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    \1\ Consistent with the FY 2010 Appropriations Act, DOT will 
apply the following principles in determining whether a project is 
eligible as a capital investment in surface transportation: (1) 
Surface transportation facilities generally include roads, highways 
and bridges, ports, freight and passenger railroads, transit 
systems, and projects that connect transportation facilities to 
other modes of transportation; and (2) surface transportation 
facilities also include any highway or bridge project eligible under 
title 23, U.S.C., or public transportation project eligible under 
chapter 53 of title 49, U.S.C. Please note that the Department may 
use a TIGER II Discretionary Grant to pay for the surface 
transportation components of a broader project that has non-surface 
transportation components, and applicants are encouraged to apply 
for TIGER II Discretionary Grants to pay for the surface 
transportation components of these projects.
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    The FY 2010 Appropriations Act requires a new solicitation of 
applications and, therefore, any unsuccessful applicant for a TIGER 
Discretionary Grant that wishes to be considered for a TIGER II 
Discretionary Grant must reapply according to the procedures in this 
notice.
    The FY 2010 Appropriations Act specifies that TIGER II 
Discretionary Grants may be not less than $10 million and not greater 
than $200 million. The comparable figures for TIGER Discretionary 
Grants funded under the Recovery Act were $20 million and $300 million, 
although the largest grant announced under the TIGER program was $105 
million. Based on DOT's experience with the TIGER Discretionary Grant 
program, it is unlikely that the $200 million maximum grant size for 
the TIGER II Discretionary Grant program will be reached for any 
project. The Recovery Act gave DOT discretion to waive the minimum 
grant size for significant projects in smaller cities, regions, or 
States. The FY 2010 Appropriations Act does not provide similar 
authority to waive the minimum $10 million grant size for TIGER II 
Discretionary Grants. However, for projects located in rural areas (as 
defined in section V (Projects in Rural Areas)), the minimum TIGER II 
Discretionary Grant size is $1 million. The term ``grant'' in the 
provision of the FY 2010 Appropriations Act specifying a minimum grant 
size does not include TIGER II TIFIA Payments, as defined below.
    Pursuant to the FY 2010 Appropriations Act, no more than 25 percent 
of the funds made available for TIGER II Discretionary Grants (or $150 
million) may be awarded to projects in a single State. The comparable 
figure for TIGER Discretionary Grants was 20 percent (or $300 million).
    The FY 2010 Appropriations Act directs that not less than $140 
million of the funds provided for TIGER II Discretionary Grants is to 
be used for projects located in rural areas. There was no comparable 
amount set aside for rural areas under the Recovery Act for TIGER 
Discretionary Grants. In awarding TIGER II Discretionary Grants 
pursuant to the FY 2010 Appropriations Act, DOT must take measures to 
ensure an equitable geographic distribution of grant funds, an 
appropriate balance in addressing the needs of urban and rural areas 
and the investment in a variety of transportation modes. The Recovery 
Act provided a similar provision for the TIGER Discretionary Grant 
program, but with no language on ensuring investments in a variety of 
transportation modes.
    TIGER II Discretionary Grants may be used for up to 80 percent of 
the costs of a project, but priority must be given to projects for 
which Federal funding is required to complete an overall financing 
package and projects can increase their competitiveness by 
demonstrating significant non-Federal contributions.\2\ The Recovery 
Act included a similar priority for TIGER Discretionary Grants, but 
allowed DOT to fund up to 100 percent of the costs of a project. For 
TIGER II Discretionary Grants, DOT may increase the Federal

[[Page 30463]]

share above 80 percent only for projects located in rural areas, in 
which case DOT may fund up to 100 percent of the costs of a project. 
However, the statutory requirement to give priority to projects that 
use Federal funds to complete an overall financing package applies to 
projects located in rural areas as well, and projects located in rural 
areas can increase their competitiveness for purposes of the TIGER II 
program by demonstrating significant non-Federal financial 
contributions.
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    \2\ DOT will consider any non-Federal funds for purposes of 
meeting the 20 percent match requirement, whether such funds are 
contributed by the public sector (State or local) or the private 
sector; however, DOT will not consider funds already expended for 
purposes of meeting the 20 percent match requirement.
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    The Recovery Act required DOT to give priority to projects that 
were expected to be completed by February 17, 2012. The FY 2010 
Appropriations Act does not include any similar requirements for the 
TIGER II Discretionary Grants, although TIGER II funds are only 
available for obligation through September 30, 2012.
    The Recovery Act emphasizes the generation of near-term economic 
effects from expenditures on project costs, such as construction job 
creation, as a fundamental goal of the TIGER Discretionary Grant 
program. However, the FY 2010 Appropriations Act does not include 
explicit emphasis on job creation and instead focuses more broadly on 
the impact of projects on the Nation, a metropolitan area, or a region 
including the medium and long-term benefits that would accrue post-
project completion. Therefore, in all cases, TIGER II Discretionary 
Grant applications will need to be competitive on the merits of the 
medium to long-term impacts of the projects themselves, as demonstrated 
by a project's alignment with the Long-Term Outcomes selection 
criterion described in Section II(A) (Selection Criteria) below. 
However, because communities nationwide continue to face difficult 
economic times, DOT will also continue to incorporate near-term impacts 
like job creation in its evaluation of TIGER II applications, as 
demonstrated by a project's alignment with the Job Creation & Economic 
Stimulus selection criterion described in Section II(A) below. 
Consideration of near-term benefits will apply particularly in the case 
of projects that will employ people in Economically Distressed Areas as 
discussed in more detail in Section II(A) below.
    The FY 2010 Appropriations Act allows for an amount not to exceed 
$150 million of the $600 million to be used to pay the subsidy and 
administrative costs of the Transportation Infrastructure Finance and 
Innovation Act of 1998 (``TIFIA'') program, a Federal credit assistance 
program, if it would further the purposes of the TIGER II Discretionary 
Grant program. DOT is referring to these payments as ``TIGER II TIFIA 
Payments.'' The Recovery Act authorized DOT to use up to $200 million 
of the amount available for TIGER Discretionary Grants for similar 
purposes.
    Based on the subsidy amounts required for projects in the TIFIA 
program's existing portfolio, DOT estimates that $150 million of TIGER 
II TIFIA Payments could support approximately $1.5 billion in TIFIA 
credit assistance. The amount of budget authority required to support 
TIFIA credit assistance is calculated on a project-by-project basis. 
Applicants for TIGER II TIFIA Payments should submit an application 
pursuant to this notice and a separate TIFIA letter of interest, as 
described below in Section VI (TIGER II TIFIA Payments). Unless 
otherwise noted, or the context requires otherwise, references in this 
notice to TIGER II Discretionary Grants include TIGER II TIFIA 
Payments.
    DOT reserves the right to offer a TIGER II TIFIA Payment to an 
applicant that applied for a TIGER II Discretionary Grant even if DOT 
does not choose to fund the requested TIGER II Discretionary Grant and 
the applicant did not specifically request a TIGER II TIFIA Payment. 
Therefore, as described below in Section VI (TIGER II TIFIA Payments), 
applicants for TIGER II Discretionary Grants, particularly applicants 
that require a substantial amount of funds to complete a financing 
package, should indicate whether or not they have considered applying 
for a TIGER II TIFIA Payment. To the extent an applicant thinks that 
TIFIA may be a viable option for the project, applicants should provide 
a brief description of a project finance plan that includes TIFIA 
credit assistance and identifies a source of revenue which may be 
available to support the TIFIA credit assistance.
    The FY 2010 Appropriations Act also permits DOT to use an amount 
not to exceed $35 million of the available TIGER II funds for the 
planning, preparation, or design of Eligible Projects (``TIGER II 
Planning Grants''). TIGER II Planning Grants may be awarded to Eligible 
Applicants. The Recovery Act did not explicitly provide funding for 
similar activities under the TIGER Discretionary Grant program.
    The FY 2010 Appropriations Act provides that the Secretary of 
Transportation may retain up to $25 million of the $600 million to fund 
the award and oversight of TIGER II Discretionary Grants. Portions of 
the $25 million may be transferred for these purposes to the 
Administrators of the Federal Highway Administration, the Federal 
Transit Administration, the Federal Railroad Administration, and the 
Federal Maritime Administration.
    The purpose of this notice is to solicit applications for TIGER II 
Discretionary Grants.

TIGER II Discretionary Grants

II. Selection Criteria and Guidance on Application of Selection 
Criteria

    This section specifies the criteria that DOT will use to evaluate 
applications for TIGER II Discretionary Grants. The criteria 
incorporate the statutory eligibility requirements for this program, 
which are specified in this notice as relevant. This section is divided 
into two parts. Part A (Selection Criteria) specifies the criteria that 
DOT will use to rate projects. Additional guidance about how DOT will 
apply these criteria, including illustrative metrics and examples, is 
provided in Part B (Additional Guidance on Selection Criteria).

A. Selection Criteria

    TIGER II Discretionary Grants will be awarded based on the 
selection criteria as outlined below. There are two categories of 
selection criteria, ``Primary Selection Criteria'' and ``Secondary 
Selection Criteria.''
    The Primary Selection Criteria include (1) Long-Term Outcomes and 
(2) Job Creation & Economic Stimulus. The Secondary Selection Criteria 
include (1) Innovation and (2) Partnership. The Primary Selection 
Criteria are intended to capture the primary objective of the TIGER II 
provisions of the FY 2010 Appropriations Act, which is to invest in 
infrastructure projects that will have a significant impact on the 
Nation, a metropolitan area, or a region. The Secondary Selection 
Criteria are intended to capture the benefits of new and/or innovative 
approaches to achieving this programmatic objective.
1. Primary Selection Criteria
(a) Long-Term Outcomes
    DOT will give priority to projects that have a significant impact 
on desirable long-term outcomes for the Nation, a metropolitan area, or 
a region. Applications that do not demonstrate a likelihood of 
significant long-term benefits in this criterion will not proceed in 
the evaluation process. The following types of long-term outcomes will 
be given priority:
    (i) State of Good Repair: Improving the condition of existing 
transportation facilities and systems, with particular emphasis on 
projects that minimize life-cycle costs.

[[Page 30464]]

    (ii) Economic Competitiveness: Contributing to the economic 
competitiveness of the United States over the medium- to long-term.
    (iii) Livability: Fostering livable communities through place-based 
policies and investments that increase transportation choices and 
access to transportation services for people in communities across the 
United States.
    (iv) Environmental Sustainability: Improving energy efficiency, 
reducing dependence on oil, reducing greenhouse gas emissions and 
benefitting the environment.
    (v) Safety: Improving the safety of U.S. transportation facilities 
and systems.
(b) Job Creation & Economic Stimulus
    While the TIGER II Discretionary Grant program is not a Recovery 
Act program, job creation and economic stimulus remain a top priority 
of this Administration; therefore, DOT will give priority (as it did 
for the TIGER Discretionary Grant program) to projects that are 
expected to quickly create and preserve jobs and stimulate rapid 
increases in economic activity, particularly jobs and activity that 
benefit economically distressed areas as defined by section 301 of the 
Public Works and Economic Development Act of 1965, as amended (42 
U.S.C. 3161) (``Economically Distressed Areas'').\3\
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    \3\ While Economically Distressed Areas are typically identified 
under the Public Works and Economic Development Act at the county 
level, for the purposes of this program DOT will consider regions, 
municipalities, smaller areas within larger communities, or other 
geographic areas to be Economically Distressed Areas if an applicant 
can demonstrate that any such area otherwise meets the requirements 
of an Economically Distressed Area as defined in section 301 of the 
Public Works and Economic Development Act of 1965.
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2. Secondary Selection Criteria
(a) Innovation
    DOT will give priority to projects that use innovative strategies 
to pursue the long-term outcomes outlined above.
(b) Partnership
    DOT will give priority to projects that demonstrate strong 
collaboration among a broad range of participants and/or integration of 
transportation with other public service efforts.

B. Additional Guidance on Selection Criteria

    The following additional guidance explains how DOT will evaluate 
each of the selection criteria identified above in Section II(A) 
(Selection Criteria). Applicants are encouraged to demonstrate the 
responsiveness of a project to any and all of the selection criteria 
with the most relevant information that applicants can provide, 
regardless of whether such information has been specifically requested, 
or identified, in this notice. Any such information shall be considered 
part of the application, not supplemental, for purposes of the 
application size limits specified below in Section IX(D) (Length of 
Application).
1. Primary Selection Criteria
(a) Long-Term Outcomes
    In order to measure a project's alignment with this criterion, DOT 
will assess the public benefits generated by the project, as measured 
by the extent to which a project produces one or more of the following 
outcomes:
    (i) State of Good Repair: In order to determine whether the project 
will improve the condition of existing transportation facilities or 
systems, including whether life-cycle costs will be minimized, DOT will 
assess (i) Whether the project is part of, or consistent with, relevant 
State, local or regional efforts and plans to maintain transportation 
facilities or systems in a state of good repair, (ii) whether an 
important aim of the project is to rehabilitate, reconstruct or upgrade 
surface transportation assets that, if left unimproved, threaten future 
transportation network efficiency, mobility of goods or people, or 
economic growth due to their poor condition, (iii) whether the project 
is appropriately capitalized up front and uses asset management 
approaches that optimize its long-term cost structure, and (iv) the 
extent to which a sustainable source of revenue is available for long-
term operations and maintenance of the project. The application should 
include any quantifiable metrics of the facility or system's current 
condition and performance and, to the extent possible, projected 
condition and performance, with an explanation of how the project will 
improve the facility or system's condition, performance and/or long-
term cost structure, including calculations of avoided operations and 
maintenance costs and associated delays.
    (ii) Economic Competitiveness: In order to determine whether a 
project promotes the economic competitiveness of the United States, DOT 
will assess whether the project will measurably contribute over the 
long term to growth in the productivity of the American economy. For 
purposes of aligning a project with this outcome, applicants should 
provide evidence of how improvements in transportation outcomes (such 
as time savings and operating cost savings) translate into long-term 
economic productivity benefits. These long-term economic benefits that 
are provided by the completed project are different from the near-term 
economic benefits of construction that are captured in the Job Creation 
& Economic Stimulus criterion. In weighing long-term economic 
competitiveness benefits, applicants should describe how the project 
supports increased long-term efficiency and productivity.
    Priority consideration will be given to projects that: (i) Improve 
long-term efficiency, reliability or cost-competitiveness in the 
movement of workers or goods, or (ii) make improvements that increase 
the economic productivity of land, capital or labor at specific 
locations, particularly Economically Distressed Areas. Applicants may 
propose other methods of demonstrating a project's contribution to the 
economic competitiveness of the country and such methods will be 
reviewed on a case-by-case basis.
    Economic competitiveness may be demonstrated by the project's 
ability to increase the efficiency and effectiveness of the 
transportation system through integration or better use of all existing 
transportation infrastructure (which may be evidenced by the project's 
involvement with or benefits to more than one mode and/or its 
compatibility with and preferably augmentation of the capacities of 
connecting modes and facilities), but only to the extent that these 
enhancements lead to the economic benefits that are identified in the 
opening paragraph of this section.
    For purposes of demonstrating economic benefits, applicants should 
estimate National-level or region-wide economic benefits on 
productivity and production, and should net out those benefits most 
likely to result in transfers of economic activity from one localized 
area to another. Therefore, in estimating local and regional benefits, 
applicants should consider net increases in economic productivity and 
benefits, and should take care not to include economic benefits that 
are being shifted from one location in the United States to another 
location. Highly localized benefits will receive the most consideration 
under circumstances where such benefits are most likely to improve an 
Economically Distressed Area (as defined herein) or otherwise improve 
access to more productive employment opportunities for under-employed 
and disadvantaged populations.

[[Page 30465]]

    Finally, the TIGER II program strives to promote long-term economic 
growth in a manner that will be sustainable for generations to come. 
Therefore, for projects designed to enhance economic competitiveness, 
applicants should also provide evidence that the project will achieve 
the goals of this outcome in an environmentally sustainable manner. To 
satisfy this condition, applicants should reference the fourth 
criterion in this Section II(B) ``Environmental Sustainability'' for 
more information on what features promote sustainable growth and be 
sure to address the extent to which sustainability features are 
incorporated into the proposed project's economic impact.
    (iii) Livability: Livability investments are projects that not only 
deliver transportation benefits, but are also designed and planned in 
such a way that they have a positive impact on qualitative measures of 
community life. This element of long-term outcomes delivers benefits 
that are inherently difficult to measure. However, it is implicit to 
livability that its benefits are shared and therefore magnified by the 
number of potential users in the affected community. Therefore, 
descriptions of how projects enhance livability should include a 
description of the affected community and the scale of the project's 
impact as measured in person-miles traveled or number of trips 
affected. In order to determine whether a project improves the quality 
of the living and working environment of a community, DOT will consider 
whether the project furthers the six livability principles developed by 
DOT with HUD and EPA as part of the Partnership for Sustainable 
Communities, which are listed fully at http://www.dot.gov/affairs/2009/dot8009.htm. For this criterion, the Department will give particular 
consideration to the first principle, which prioritizes the creation of 
affordable and convenient transportation choices.\4\ Specifically, DOT 
will qualitatively assess whether the project:
---------------------------------------------------------------------------

    \4\ In full, this principle reads: ``Provide more transportation 
choices. Develop safe, reliable and economical transportation 
choices to decrease household transportation costs, reduce our 
nation's dependence on foreign oil, improve air quality, reduce 
greenhouse gas emissions and promote public health.''
---------------------------------------------------------------------------

    (1) Will significantly enhance or reduce the average cost of user 
mobility through the creation of more convenient transportation options 
for travelers;
    (2) will improve existing transportation choices by enhancing 
points of modal connectivity, increasing the number of modes 
accommodated on existing assets, or reducing congestion on existing 
modal assets;
    (3) will improve accessibility and transport services for 
economically disadvantaged populations, non-drivers, senior citizens, 
and persons with disabilities, or will make goods, commodities, and 
services more readily available to these groups; and/or
    (4) is the result of a planning process which coordinated 
transportation and land-use planning decisions and encouraged community 
participation in the process.

Livability improvements may include projects for new or improved biking 
and walking infrastructure. Particular attention will be paid to the 
degree to which such projects contribute significantly to broader 
traveler mobility through intermodal connections, enhanced job 
commuting options, or improved connections between residential and 
commercial areas. Projects that appear designed primarily as isolated 
recreational facilities and do not enhance traveler mobility as 
described above will not be funded.
    (iv) Environmental Sustainability: In order to determine whether a 
project promotes a more environmentally sustainable transportation 
system, DOT will assess the project's ability to:
    (1) Improve energy efficiency, reduce dependence on oil and/or 
reduce greenhouse gas emissions; applicants are encouraged to provide 
quantitative information regarding expected reductions in emissions of 
CO2 or fuel consumption as a result of the project, or 
expected use of clean or alternative sources of energy; projects that 
demonstrate a projected decrease in the movement of people or goods by 
less energy-efficient vehicles or systems will be given priority under 
this factor; and
    (2) maintain, protect or enhance the environment, as evidenced by 
its avoidance of adverse environmental impacts (for example, adverse 
impacts related to air or water quality, wetlands, and endangered 
species) and/or by its environmental benefits (for example, improved 
air quality, wetlands creation or improved habitat connectivity).

Applicants are encouraged to provide quantitative information that 
validates the existence of substantial transportation-related costs 
related to energy consumption and adverse environmental effects and 
evidence of the extent to which the project will reduce or mitigate 
those costs.
(v) Safety
    In order to determine whether the project improves safety, DOT will 
assess the project's ability to reduce the number, rate and 
consequences of surface transportation-related crashes, and injuries 
and fatalities among drivers and/or non-drivers in the United States or 
in the affected metropolitan area or region, and/or the project's 
contribution to the elimination of highway/rail grade crossings, the 
protection of pipelines, or the prevention of unintended release of 
hazardous materials.
    Evaluation of Expected Project Costs and Benefits: DOT believes 
that benefit-cost analysis (``BCA''), including the monetization and 
discounting of costs and benefits in a common unit of measurement in 
present-day dollars, is an important discipline. For BCA to yield 
useful results, full consideration of costs and benefits is necessary. 
These include traditionally quantified fuel and travel time savings as 
well as reductions in greenhouse gas emissions, water quality impacts, 
public health effects, and other costs and benefits that are more 
indirectly related to vehicle-miles or that are harder to measure. In 
addition, BCA should attempt to measure the indirect effects of 
transportation investments on land use and on the portions of household 
budgets spent on transportation. The systematic process of comparing 
expected benefits and costs helps decision-makers organize information 
about, and evaluate trade-offs between, alternative transportation 
investments. DOT has a responsibility under Executive Order 12893, 
Principles for Federal Infrastructure Investments, 59 FR 4233, to base 
infrastructure investments on systematic analysis of expected benefits 
and costs, including both quantitative and qualitative measures.
    Therefore, applicants for TIGER II Discretionary Grants are 
generally required to identify, quantify, and compare expected benefits 
and costs, subject to the following qualifications:
    All applicants will be expected to prepare an analysis of benefits 
and costs; however, DOT understands that the level of expense that can 
be expected in these analyses for surveys, travel demand forecasts, 
market forecasts, statistical analyses, and so on will be less for 
smaller projects than for larger projects. Smaller projects will 
therefore be given greater latitude to estimate benefits subjectively. 
However, even smaller projects will be expected to quantify these 
subjective estimates of benefits and costs, and to provide whatever 
evidence they have available to lend credence to their subjective 
estimates. Estimates of benefits should be presented in monetary terms 
whenever possible; if a monetary estimate is not possible, then at 
least a

[[Page 30466]]

quantitative estimate (in physical, non-monetary terms, such as 
ridership estimates, emissions levels, etc.) should be provided.
    The requirement to conduct an economic analysis is not applicable 
to applicants seeking TIGER II Planning Grants; however, such 
applicants should describe the expected benefits of the underlying 
project(s) that the planning activities will help advance.
    The lack of a useful analysis of expected project benefits and 
costs may be the basis for denying an award of a TIGER II Discretionary 
Grant to an applicant. If it is clear to DOT that the total benefits of 
a project are not reasonably likely to outweigh the project's costs, 
DOT will not award a TIGER II Discretionary Grant to the project. 
Consistent with the broader goals of DOT and the FY 2010 Appropriations 
Act, DOT can consider some factors that do not readily lend themselves 
to quantification or monetization, including equitable geographic 
distribution of grant funds and an appropriate balance in addressing 
the needs of urban and rural areas and investment in a variety of 
transportation modes.
    Detailed guidance for the preparation of benefit-cost analyses is 
provided in Appendix A. Benefits should be presented, whenever 
possible, in a tabular form showing benefits and costs in each year for 
the useful life of the project. Benefits and costs should both be 
discounted to the year 2010 and present discounted values of both the 
stream of benefits and the stream of costs should be calculated. If the 
project has multiple parts, each of which has independent utility, the 
benefits and costs of each part should be estimated and presented 
separately. A project component has independent utility if the 
component itself is an Eligible Project and provides benefits that 
satisfy the selection criteria specified in this notice, as described 
further in Section III(B) (Evaluation of Eligibility) below. The 
benefit-cost analysis should be summarized in the text of the 
application itself, but the details may be presented in an attachment 
to the application.
    DOT recognizes that some categories of costs and benefits are more 
difficult to quantify or monetize than others. In presenting benefit-
cost analyses, applicants should include qualitative discussion of the 
categories of benefits and costs that they were not able to quantify, 
noting that these benefits and costs are in addition to other benefits 
and costs that were quantified. However, in the event of an 
unreasonable absence of data and analysis, or poor applicant effort to 
put forth a robust quantification of benefits and costs, the 
application is unlikely to receive further consideration. In general, 
the lack of a useful analysis comparing benefits and costs for any such 
project is ground for denying the award of a TIGER II Discretionary 
Grant.
    Evaluation of Project Performance: Each project selected for TIGER 
II Discretionary Grant funding will be required to work with DOT on the 
development and implementation of a plan to collect information and 
report on the project's performance with respect to the relevant long-
term outcomes that are expected to be achieved through construction of 
the project.
(b) Job Creation & Economic Stimulus
    In order to measure a project's alignment with this criterion, DOT 
will assess whether the project promotes the short- or long-term 
creation or preservation of jobs and whether the project rapidly 
promotes new or expanded business opportunities during construction of 
the project or thereafter. Demonstration of a project's rapid economic 
impact is critical to a project's alignment with this criterion. 
Applicants are encouraged to provide information to assist DOT in 
making these assessments, including the total amount of funds that will 
be expended on construction and construction-related activities by all 
of the entities participating in the project and, to the extent 
measurable, the number and type of jobs to be created and/or preserved 
by the project by calendar quarters during construction and annually 
thereafter. Applicants should also identify any business enterprises to 
be created or benefited by the project during its construction and once 
it becomes operational.\5\
---------------------------------------------------------------------------

    \5\ The Executive Office of the President, Council of Economic 
Advisers, issued a memorandum in May 2009 on ``Estimates of Job 
Creation from the American Recovery and Reinvestment Act of 2009.'' 
The memorandum is available at: http://www.whitehouse.gov/administration/eop/cea/Estimate-of-Job-Creation/. Table 5 of this 
memorandum provides a simple rule for estimating job-years created 
by government spending, which is that $92,000 of government spending 
creates one job-year. Of this, 64% of the job-year estimate 
represents direct and indirect effects and 36% of the job-year 
estimate represents induced effects. Applicants can use this 
estimate as an appropriate indicator of direct, indirect and induced 
job-years created by TIGER II Discretionary Grant spending, but are 
encouraged to supplement or modify this estimate to the extent they 
can demonstrate that such modifications are justified. However, 
since the May 2009 memorandum makes job creation purely a function 
of the level of expenditure, applicants should also demonstrate how 
quickly jobs will be created under the proposed project. Projects 
that generate a given number of jobs more quickly will have a more 
favorable impact on economic recovery. A quarter-by-quarter 
projection of the number of direct job-hours expected to be created 
by the project is useful in assessing the impacts of a project on 
economic recovery. Furthermore, applicants should be aware that 
certain types of expenditures are less likely to align well with the 
Job Creation & Economic Stimulus criterion. These types of 
expenditures include, among other things, engineering or design work 
and purchasing existing facilities or right-of-way.
---------------------------------------------------------------------------

    Consistent with the Recovery Act, the Updated Implementing Guidance 
for the American Recovery and Reinvestment Act of 2009 issued by the 
Office of Management and Budget (``OMB'') on April 3, 2009 (the ``OMB 
Guidance''), and consistent with applicable Federal laws, applicants 
are encouraged to provide information to assist DOT in assessing (1) 
Whether the project will promote the creation of job opportunities for 
low-income workers through the use of best practice hiring programs and 
utilization of apprenticeship (including pre-apprenticeship) programs; 
(2) whether the project will provide maximum practicable opportunities 
for small businesses and disadvantaged business enterprises, including 
veteran-owned small businesses and service disabled veteran-owned small 
businesses; (3) whether the project will make effective use of 
community-based organizations in connecting disadvantaged workers with 
economic opportunities; (4) whether the project will support entities 
that have a sound track record on labor practices and compliance with 
Federal laws ensuring that American workers are safe and treated 
fairly; and (5) whether the project implements best practices, 
consistent with our Nation's civil rights and equal opportunity laws, 
for ensuring that all individuals--regardless of race, gender, age, 
disability, and national origin--benefit from TIGER II grant funding.
    To the extent possible, applicants should indicate whether the 
populations most likely to benefit from the creation or preservation of 
jobs or new or expanded business opportunities are from Economically 
Distressed Areas. In addition, to the extent possible, applicants 
should indicate whether the project's procurement plan is likely to 
create follow-on jobs and economic stimulus for manufacturers and 
suppliers that support the construction industry. A key consideration 
in assessing projects under this criterion will be how quickly jobs are 
created.
    In evaluating a project's alignment with this criterion, DOT will 
assess whether a project is ready to proceed rapidly upon receipt of a 
TIGER II Discretionary Grant, as evidenced by:

[[Page 30467]]

    (i) Project Schedule: A feasible and sufficiently detailed project 
schedule demonstrating that the project can begin construction quickly 
upon receipt of a TIGER II Discretionary Grant and that the grant funds 
will be spent steadily and expeditiously once construction starts; the 
schedule should show how many direct, on-project jobs are expected to 
be created or sustained during each calendar quarter after the project 
is underway;
    (ii) Environmental Approvals: Receipt (or reasonably anticipated 
receipt) of all environmental approvals necessary for the project to 
proceed to construction on the timeline specified in the project 
schedule, including satisfaction of all Federal, State and local 
requirements and completion of the National Environmental Policy Act 
(``NEPA'') process;
    To demonstrate satisfaction of this requirement, applicants should 
provide assurances with their pre-applications that NEPA review is 
complete or substantially complete and submit relevant draft or final 
NEPA documentation--preferably by way of a Web site link--for DOT 
review. DOT is unlikely to select a project for TIGER II Discretionary 
Grant funding if it involves significant environmental impacts and has 
not substantially completed required environmental and regulatory 
reviews.
    DOT will consider exceptions to the requirement that NEPA be 
substantially complete upon application on a case-by-case basis. An 
applicant must provide a reasonable justification for why NEPA review 
was not initiated with a Federal agency prior to the date of this 
notice, and an assurance that the necessary environmental reviews can 
be completed at least 90 days in advance of the September 30, 2012, 
deadline for obligation of TIGER II Discretionary Grant funds. An 
example of a reasonable justification for why an applicant has not 
initiated NEPA review would be if, prior to the availability of TIGER 
II Discretionary Grant funds, there was no reasonable expectation of 
receiving Federal funding for the project. A project may be selected 
for award but will not receive award grant monies until NEPA is 
complete and all other necessary environmental approvals have been 
received.
    An applicant seeking to justify an exception to this requirement 
should submit the information listed below with its application:
    a. The information required under Sections VIII(C)(2)(V) and 
VIII(F)-(G) (Contents of Applications) of this notice;
    b. Environmental studies or other documents--preferably by way of a 
Web site link--that describe in detail known potential project impacts, 
and possible mitigation for those impacts;
    c. A description of completed, or planned and anticipated 
coordination with Federal and State regulatory agencies for permits and 
approvals;
    d. An estimate of the time required for completion of NEPA and all 
other required Federal, State or local environmental approvals; and
    e. An identification of the proposed NEPA class of action (i.e., 
Categorical Exclusion, Environmental Assessment, or Environmental 
Impact Statement).
    (iii) Legislative Approvals: Receipt of all necessary legislative 
approvals (for example, legislative authority to charge user fees or 
set toll rates), and evidence of support from State and local elected 
officials; evidence of support from all relevant State and local 
officials is not required, however, the evidence should demonstrate 
that the project is broadly supported;
    (iv) State and Local Planning: The inclusion of the project in the 
relevant State, metropolitan, and local planning documents, or a 
certification from the appropriate agency that the project will be 
included in the relevant planning document prior to award of a TIGER II 
Discretionary Grant \6\; any MPO that is applying for a TIGER II 
Discretionary Grant should provide evidence that the owner of the 
project supports the application and will cooperate in carrying out the 
activities to be supported by the TIGER II Discretionary Grant;
---------------------------------------------------------------------------

    \6\ All regionally significant projects requiring an action by 
the FHWA or the FTA must be in the metropolitan transportation plan, 
TIP and STIP. Further, in air quality non-attainment and maintenance 
areas, all regionally significant projects, regardless of the 
funding source, must be included in the conforming metropolitan 
transportation plan and TIP. To the extent a project is required to 
be on a metropolitan transportation plan, TIP and/or STIP it will 
not receive a TIGER II Discretionary Grant until it is included in 
such plans. Projects not currently included in these plans can be 
amended in by the State and MPO. Projects that are not required to 
be in long range transportation plans, STIPs and TIPs will not need 
to be included in such plans in order to receive a TIGER II 
Discretionary Grant. Freight and passenger rail projects are not 
required to be on the State Rail Plans called for in the Passenger 
Rail Investment and Improvement Act of 2008. This is consistent with 
the exemption for high speed and intercity passenger rail projects 
under the Recovery Act. However, applicants seeking funding for 
freight and passenger rail projects are encouraged to demonstrate 
that they have done sufficient planning to ensure that projects fit 
into a prioritized list of capital needs and are consistent with 
long-range goals.
---------------------------------------------------------------------------

    (v) Technical Feasibility: The technical feasibility of the 
project, including completion of substantial preliminary engineering 
work; and
    (vi) Financial Feasibility: The viability and completeness of the 
project's financing package (assuming the availability of the requested 
TIGER II Discretionary Grant funds), including evidence of stable and 
reliable financial commitments and contingency reserves, as 
appropriate, and evidence of the grant recipient's ability to manage 
grants.
    DOT reserves the right to revoke any award of TIGER II 
Discretionary Grant funds and to award such funds to another project to 
the extent that such funds are not timely expended and/or construction 
does not begin in accordance with the project schedule. Because 
projects have different schedules DOT will consider on a case-by-case 
basis how much time after selection for award of a TIGER II 
Discretionary Grant each project has before funds must be obligated 
(consistent with law) and construction started. This deadline will be 
specified for each TIGER II Discretionary Grant in the project-specific 
grant agreements signed by the grant recipients and will be based on 
critical path items identified by applicants in response to items (i) 
through (vi) above. For example, if an applicant reasonably anticipates 
that NEPA requirements will be completed and final documentation 
received within 30 to 60 days of award of a TIGER II Discretionary 
Grant, this timeframe will be taken into account in evaluating the 
application, but also in establishing a deadline for obligation of 
funds and commencement of construction. DOT's ability to obligate funds 
for TIGER II Discretionary Grants expires on September 30, 2012.
2. Secondary Selection Criteria
(a) Innovation
    In order to measure a project's alignment with this criterion, DOT 
will assess the extent to which the project uses innovative technology 
(including, for example, intelligent transportation systems, dynamic 
pricing, rail wayside or on-board energy recovery, smart cards, real-
time dispatching, active traffic management, radio frequency 
identification (RFID), or others) to pursue one or more of the long-
term outcomes outlined above and/or to significantly enhance the 
operational performance of the transportation system. DOT will also 
assess the extent to which the project incorporates innovations that 
demonstrate the value of new approaches to, among other things, 
transportation funding and finance, contracting, project delivery, 
congestion management, safety management, asset management, or long-
term operations and maintenance. The applicant should clearly

[[Page 30468]]

demonstrate that the innovation is designed to pursue one or more of 
the long-term outcomes outlined above and/or significantly enhance the 
transportation system.
    Innovative, multi-modal projects are often difficult to fund under 
traditional transportation programs. DOT will consider the extent to 
which innovative projects might be difficult to fund under other 
programs and will give priority to projects that align well with the 
Primary Selection Criteria but are unlikely to receive funding under 
traditional programs.
(b) Partnership
    (i) Jurisdictional & Stakeholder Collaboration: In order to measure 
a project's alignment with this criterion, DOT will assess the 
project's involvement of non-Federal entities and the use of non-
Federal funds, including the scope of involvement and share of total 
funding. DOT will give priority to projects that receive financial 
commitments from, or otherwise involve, State and local governments, 
other public entities, or private or nonprofit entities, including 
projects that engage parties that are not traditionally involved in 
transportation projects, such as nonprofit community groups. Pursuant 
to the OMB Guidance, DOT will give priority to projects that make 
effective use of community-based organizations in connecting 
disadvantaged people with economic opportunities.
    In compliance with the FY 2010 Appropriations Act, DOT will give 
priority to projects for which a TIGER II Discretionary Grant will help 
to complete an overall financing package. An applicant should clearly 
demonstrate the extent to which the project cannot be readily and 
efficiently completed without Federal assistance, and the extent to 
which other sources of Federal assistance are or are not readily 
available for the project. DOT will assess the amount of private debt 
and equity to be invested in the project or the amount of co-investment 
from State, local or other non-profit sources.
    DOT will also assess the extent to which the project demonstrates 
collaboration among neighboring or regional jurisdictions to achieve 
National, regional or metropolitan benefits. Multiple States or 
jurisdictions may submit a joint application and should identify a lead 
State or jurisdiction as the primary point of contact. Where multiple 
States or jurisdictions are submitting a joint application, the 
application should demonstrate how the project costs are apportioned 
between the States or jurisdictions to assist DOT in making the 
distributional determinations described below in Section III(C) 
(Distribution of Funds).
    (ii) Disciplinary Integration: In order to demonstrate the value of 
partnerships across government agencies that serve various public 
service missions and to promote collaboration on the objectives 
outlined in this notice, DOT will give priority to projects that are 
supported, financially or otherwise, by non-transportation public 
agencies that are pursuing similar objectives. For example, DOT will 
give priority to transportation projects that create more livable 
communities and are supported by relevant public housing agencies or 
are consistent with State or local efforts or plans to promote economic 
development, revitalize communities, or protect historic or cultural 
assets; similarly, DOT will give priority to transportation projects 
that encourage energy efficiency or improve the environment and are 
supported by relevant public agencies with energy or environmental 
missions.

III. Evaluation and Selection Process

A. Evaluation Process

    TIGER II Discretionary Grant applications will be evaluated in 
accordance with the below discussed evaluation process. DOT will 
establish a pre-application evaluation team to review each pre-
application that is received by DOT on or prior to the Pre-Application 
Deadline. This evaluation team will be organized and led by the Office 
of the Secretary and will include members from the relevant modal 
administrations in DOT with the most experience and/or expertise in the 
relevant project areas (the ``Cognizant Modal Administrations''). These 
representatives will include technical and professional staff with 
relevant experience and/or expertise. This evaluation team will be 
responsible for analyzing whether the pre-application satisfies the 
following key threshold requirements:
    1. The project is an Eligible Project or a DOT Eligible Planning 
Activity;
    2. NEPA is substantially complete, as described above in Section 
II(B)(2)(b)(ii) (Environmental Approvals); and
    3. Local matching funds to support 20 percent or more of the costs 
for the project are identified and committed; this requirement is not 
applicable to projects located in rural areas, however, applications 
for projects in rural areas will be more competitive to the extent they 
include non-Federal financial contributions.
    To the extent the pre-application evaluation team determines that a 
pre-application does not satisfy these key threshold requirements, DOT 
will inform the project sponsor that an application for the project 
will not be reviewed unless the application submitted on or prior to 
the Application Deadline can demonstrate that the requirement has been 
addressed.
    DOT will establish application evaluation teams to review each 
application that is received by DOT prior to the Application Deadline. 
These evaluation teams will be organized and led by the Office of the 
Secretary and will include members from each of the Cognizant Modal 
Administrations. These representatives will include technical and 
professional staff with relevant experience and/or expertise. The 
evaluation teams will be responsible for evaluating and rating all of 
the projects and making funding recommendations to the Secretary. The 
evaluation process will require team members to evaluate and rate 
applications individually before convening with other members to 
discuss ratings. The composition of the evaluation teams will be 
finalized after the Pre-Application Deadline, based on the number and 
nature of pre-applications received.
    DOT will not assign specific numerical scores to projects based on 
the selection criteria outlined above in Section II(A) (Selection 
Criteria). Rather, ratings of ``highly recommended,'' ``recommended,'' 
``not recommended'', or ``negative'' will be assigned to projects for 
each of the selection criteria. DOT will award TIGER II Discretionary 
Grants to projects that are well-aligned with one or more of the 
selection criteria, with projects that are well-aligned with multiple 
selection criteria being more likely to receive TIGER II Discretionary 
Grants. In addition, DOT will consider whether a project has a negative 
effect on any of the selection criteria, and any such negative effect 
may reduce the likelihood that the project will receive a TIGER II 
Discretionary Grant. To the extent the initial evaluation process does 
not sufficiently differentiate among highly rated projects, DOT will 
use a similar rating process to re-assess the projects that were highly 
rated and identify those that should be most highly rated.
    DOT will give more weight to the two Primary Selection Criteria 
(Long-Term Outcomes and Job Creation & Economic Stimulus), which will 
be rated equally, than to the two Secondary Selection Criteria 
(Innovation and Partnership). Projects that are unable to demonstrate a 
likelihood of significant long-term

[[Page 30469]]

benefits in any of the five long-term outcomes identified in Section 
II(A)(1)(a) (Long-Term Outcomes) will not proceed in the evaluation 
process. A project need not be well aligned with each of the long-term 
outcomes in order to be successful in the long-term outcomes criterion 
overall. However, projects that are strongly aligned with multiple 
long-term outcomes will be the most successful in this criterion. 
Furthermore, a project that has a negative effect on safety or 
environmental sustainability will need to demonstrate significant 
merits in other long-term outcomes in order to be selected for funding.
    For the Job Creation & Economic Stimulus criterion, projects need 
not receive a rating of ``highly recommended'' in order to be 
recommended for funding, although a project that is not ready to 
proceed quickly, as evidenced by the items requested in Section 
II(B)(1)(b)(i)-(vi) (Project Schedule, Environmental Approvals, 
Legislative Approvals, State and Local Planning, Technical Feasibility, 
and Financial Feasibility), is less likely to be successful in this 
criterion.
    DOT will give less weight to the two Secondary Selection Criteria 
(Innovation and Partnership) than to the two Primary Selection Criteria 
(Long-Term Outcomes and Job Creation & Economic Stimulus). The two 
Secondary Selection Criteria will be rated equally.
    The following table summarizes the weighting of the selection 
criteria, as described in the preceding paragraphs:

------------------------------------------------------------------------

------------------------------------------------------------------------
Long-Term Outcomes................................  DOT will give more
                                                     weight to this
                                                     criterion than to
                                                     either of the
                                                     Secondary Selection
                                                     Criteria. In
                                                     addition, this
                                                     criterion has a
                                                     minimum threshold
                                                     requirement.
                                                     Projects that are
                                                     unable to
                                                     demonstrate a
                                                     likelihood of
                                                     significant long-
                                                     term benefits in
                                                     any of the five
                                                     long-term outcomes
                                                     identified in this
                                                     criterion will not
                                                     proceed in the
                                                     evaluation process.
Job Creation & Economic Stimulus..................  DOT will give more
                                                     weight to this
                                                     criterion than to
                                                     either of the
                                                     Secondary Selection
                                                     Criteria. This
                                                     criterion will be
                                                     considered after it
                                                     is determined that
                                                     a project
                                                     demonstrates a
                                                     likelihood of
                                                     significant long-
                                                     term benefits in at
                                                     least one of the
                                                     five long-term
                                                     outcomes identified
                                                     in the long-term
                                                     outcomes criterion.
Innovation & Partnership..........................  DOT will give less
                                                     weight to these
                                                     criteria than to
                                                     the Primary
                                                     Selection Criteria.
                                                     These criteria will
                                                     be rated equally.
------------------------------------------------------------------------

    As noted below in Section III(C) (Distribution of Funds), upon 
completion of this competitive rating process DOT will analyze the 
preliminary list and determine whether the purely competitive ratings 
are consistent with the distributional requirements of the FY 2010 
Appropriations Act. If necessary, DOT will adjust the list of 
recommended projects to satisfy the statutory distributional 
requirements while remaining as consistent as possible with the 
competitive ratings.

B. Evaluation of Eligibility

    To be selected for a TIGER II Discretionary Grant, a project must 
be an Eligible Project and the applicant must be an Eligible Applicant. 
DOT may consider one or more components of a large project to be an 
Eligible Project, but only to the extent that the components have 
independent utility, meaning the components themselves, not the project 
of which they are a part, are Eligible Projects and satisfy the 
selection criteria identified above in Section II(A) (Selection 
Criteria). For these projects, the benefits described in an application 
must be related to the components of the project for which funding is 
requested, not the full project of which they are a part. DOT will not 
fund individual phases of a project if the benefits of completing only 
these phases would not align well with the selection criteria specified 
in the Notice because the overall project would still be incomplete.
    To the extent an applicant requests a substantial amount of grant 
funds for a larger project or a group of related projects, DOT reserves 
the right to award funds for a part of the project, not the full 
project, if a part of the project has independent utility and aligns 
well with the selection criteria specified in this notice. To the 
extent applicants expect that DOT may wish to consider funding one or 
more parts of a project and not the full project that is the subject of 
the application, then applicants should clearly identify in their 
applications the separate parts of the project and the benefits that 
each part of the project provides, and how these benefits align with 
the selection criteria. Similarly, if a project is not viable unless 
DOT funds the full project, this should be stated in the application.

C. Distribution of Funds

    As noted above in Section I (Background), the FY 2010 
Appropriations Act prohibits the award of more than 25 percent of the 
funds made available under the TIGER II program to projects in any one 
State. The FY 2010 Appropriations Act also requires that DOT take 
measures to ensure an equitable geographic distribution of funds, an 
appropriate balance in addressing the needs of urban and rural areas, 
and the investment in a variety of transportation modes. DOT will apply 
an initial unconstrained competitive rating process based on the 
selection criteria identified above in Section II(A) (Selection 
Criteria) to determine a preliminary list of projects recommended for 
TIGER II Discretionary Grants. DOT will then analyze the preliminary 
list and determine whether the purely competitive ratings are 
consistent with the distributional requirements of the FY 2010 
Appropriations Act. If necessary, DOT will adjust the list of 
recommended projects to satisfy the statutory distributional 
requirements while remaining as consistent as possible with the 
competitive ratings.
    As noted above in Section II(B)(2)(b)(i) (Jurisdictional & 
Stakeholder Collaboration), applications submitted jointly by multiple 
States should include an allocation of project costs to assist DOT in 
making these determinations. In addition, DOT will use the subsidy and 
administrative cost estimate, not the principal amount of credit 
assistance, to determine any TIGER II TIFIA Payment's effect on these 
distributional requirements.

D. Transparency of Process

    In the interest of transparency, DOT will disclose as much of the 
information related to its evaluation process as is practical and 
consistent with law. DOT expects that the TIGER II Discretionary Grant 
program may be reviewed and/or audited by Congress, the U.S. Government 
Accountability Office, DOT's Inspector General, or others, and has and 
will continue to take steps to document its decision-making process.

IV. Grant Administration

    DOT expects that each TIGER II Discretionary Grant will be 
administered by one of the Cognizant Modal Administration, pursuant to 
a grant agreement between the TIGER II

[[Page 30470]]

Discretionary Grant recipient and the Cognizant Modal Administration. 
In accordance with the FY 2010 Appropriations Act, the Secretary has 
the discretion to delegate such responsibilities.
    Applicable Federal laws, rules and regulations will apply to 
projects that receive TIGER II Discretionary Grants.
    As noted above in Section II(B)(1)(b) (Job Creation & Economic 
Stimulus), how soon after selection for award a project is expected to 
obligate grant funds and start construction will be considered on a 
case-by-case basis and will be specified in the project-specific grant 
agreements. DOT reserves the right to revoke any award of TIGER II 
Discretionary Grant funds and to award such funds to another project to 
the extent that such funds are not timely expended and/or construction 
does not begin in accordance with the project schedule. DOT's ability 
to obligate funds for TIGER II Discretionary Grants expires on 
September 30, 2012.

V. Projects in Rural Areas

    The FY 2010 Appropriations Act directs that not less than $140 
million of the funds provided for TIGER II Discretionary Grants are to 
be used for projects in rural areas. For purposes of this notice, DOT 
is generally defining ``rural area'' as any area not in an Urbanized 
Area, as such term is defined by the Census Bureau,\7\ and will 
consider a project to be in a rural area if all or the majority of a 
project is located in a rural area. To the extent more than a de 
minimis portion of a project is located in an Urbanized Area, 
applicants should identify the estimated percentage of project costs 
that will be spent in Urbanized Areas and the estimated percentage that 
will be spent in rural areas.
---------------------------------------------------------------------------

    \7\ For Census 2000, the Census Bureau defined an Urbanized Area 
(UA) as an area that consists of densely settled territory that 
contains 50,000 or more people. Updated lists of UAs are available 
on the Census Bureau Web site. Urban Clusters (UCs) will be 
considered rural areas for purposes of the TIGER II Discretionary 
Grant program.
---------------------------------------------------------------------------

    For projects located in rural areas the FY 2010 Appropriation Act 
does not require matching funds (although the statute does direct DOT 
to give priority to projects, including projects located in rural 
areas, for which Federal funding is required to complete an overall 
financing package that includes non-Federal sources of funds) and the 
minimum grant size is $1 million. Applicants for TIGER II Discretionary 
Grants of between $1 million and $10 million for projects located in 
rural areas are encouraged to apply and should address the same 
criteria as applicants for TIGER II Discretionary Grants in excess of 
$10 million.

VI. TIGER II TIFIA Payments

    Up to $150 million of the $600 million available for TIGER II 
Discretionary Grants may be used for TIGER II TIFIA Payments. Based on 
the average subsidy cost of the existing TIFIA portfolio, $150 million 
in TIGER II TIFIA Payments could support approximately $1.5 billion in 
Federal credit assistance.
    Applicants seeking TIGER II TIFIA Payments should apply in 
accordance with all of the criteria and guidance specified in this 
notice for TIGER II Discretionary Grant applications and will be 
evaluated concurrently with all other applicants. Any applicant seeking 
a TIGER II TIFIA Payment is also required to submit a TIFIA letter of 
interest concurrent with the TIGER II TIFIA Payment application. If 
selected for a TIGER II TIFIA Payment, the applicant must comply with 
all of the TIFIA program's standard application and approval 
requirements including submission of a complete TIFIA application and 
$50,000 application fee (the TIFIA program guide can be downloaded from 
http://tifia.fhwa.dot.gov/).
    Applicants should demonstrate that they are ready to proceed 
rapidly upon receipt of a TIGER II TIFIA Payment in accordance with the 
guidance specified above in Section II(B)(1)(b) (Job Creation & 
Economic Stimulus). DOT's TIFIA Joint Program Office will assist DOT in 
determining a project's readiness to proceed rapidly upon receipt of a 
TIGER II TIFIA Payment.
    Applicants seeking TIGER II TIFIA Payments may also apply for a 
TIGER II Discretionary Grant for the same project and must indicate the 
type(s) of funding for which they are applying clearly on the face of 
their applications. An applicant for a TIGER II TIFIA Payment must 
submit an application pursuant to this notice for a TIGER II TIFIA 
Payment even if it does not wish to apply for a TIGER II Discretionary 
Grant.
    DOT reserves the right to offer a TIGER II TIFIA Payment to an 
applicant that applied for a TIGER II Discretionary Grant even if DOT 
does not choose to fund the requested TIGER II Discretionary Grant 
request and the applicant did not request a TIGER II TIFIA Payment. 
Therefore, applicants for TIGER II Discretionary Grants, particularly 
applicants that require a substantial amount of funds to complete a 
financing package, should indicate whether or not they have considered 
applying for a TIGER II TIFIA Payment. To the extent an applicant 
thinks that TIFIA may be a viable option for the project, applicants 
should provide a brief description of a project finance plan that 
includes TIFIA credit assistance and identifies a source of revenue 
which may be available to support the TIFIA credit assistance.
    Unless otherwise expressly noted herein, any and all requirements 
that apply to TIGER II Discretionary Grants pursuant to the FY 2010 
Appropriations Act, this notice, or otherwise, apply to TIGER II TIFIA 
Payments. TIFIA applicants that do not receive TIGER II TIFIA Payments 
will not be required to comply with any of these requirements.

VII. TIGER II Planning Grants

    The FY 2010 Appropriations Act permits DOT to use up to $35 million 
of the amount available for TIGER II Discretionary Grants for TIGER II 
Planning Grants.
    As noted above in the SUPPLEMENTARY INFORMATION section, DOT plans 
to conduct a multi-agency evaluation and award process with HUD for 
DOT's TIGER II Planning Grants and HUD's Community Challenge Planning 
Grants, which were also authorized under the FY 2010 Appropriations 
Act. This approach is consistent with DOT and HUD's participation in 
the ``Partnership for Sustainable Communities'' with EPA to help 
American families in all communities--rural, suburban and urban--gain 
better access to affordable housing, more transportation options, lower 
transportation costs, and a cleaner environment. The details of this 
multi-agency planning grant program, including information about 
eligibility, selection criteria, and pre-application and application 
requirements, are described in a joint notice of funding availability 
to be published in the Federal Register by DOT and HUD. The joint 
notice will be published shortly after this notice and signed by the 
Secretaries of each agency. Interested parties are encouraged to review 
the joint notice for more information.
    TIGER II Planning Grants may be awarded, like TIGER II 
Discretionary Grants, to Eligible Applicants, and may be used for 
activities related to the planning, preparation or design of Eligible 
Projects, including transportation corridors or regional transportation 
systems (``DOT Eligible Planning Activities'').
    Applicants need not divide requests for planning and capital 
funding for the same projects and submit two applications, one under 
this notice and one under the joint notice with HUD. Applicants may 
request planning funds as part of an application for capital funds 
under this notice, if the request

[[Page 30471]]

for planning and capital funding is for the same project. Such an 
application would be reviewed and administered subject to the 
information and requirements provided in this notice.
    DOT reserves the right to offer a TIGER II Planning Grant to an 
applicant that applied for a TIGER II Discretionary Grant even if DOT 
does not choose to fund the requested TIGER II Discretionary Grant 
request and the applicant did not request a TIGER II Planning Grant.

Pre-Application and Application Cycle

VIII. Pre-Application and Application Cycle

A. Two Stages of Application Cycle

    The application cycle for TIGER II Discretionary Grants has two 
stages:
    1. Pre-Application: In Stage 1, applicants must submit a pre-
application form to the DOT. This step qualifies applicants to submit 
an application in Stage 2. No application submitted during Stage 2 that 
does not correlate with a properly completed Stage 1 pre-application 
will be considered.
    2. Application: In Stage 2, applicants must submit a complete 
application package through Grants.gov.
    Pre-applications must be submitted to DOT by the Pre-Application 
Deadline, which is July 16, 2010, at 5 p.m. EST. Final applications 
must be submitted through Grants.gov by the Application Deadline, which 
is August 23, 2010, at 5 p.m. EST. The Grants.gov ``Apply'' function 
will open on July 30, 2010, allowing applicants to submit applications. 
While applicants are encouraged to submit pre-applications in advance 
of the Pre-Application Deadline, pre-applications will not be reviewed 
until after the Pre-Application Deadline. Similarly, while applicants 
are encouraged to submit applications in advance of the Application 
Deadline, applications will not be evaluated, and selections for awards 
will not be made, until after the Application Deadline.
    Pre-applications (stage 1) must be submitted to the DOT. The pre-
application form will be available on the DOT Web site at http://www.dot.gov/recovery/ost/TIGERII on June 23, 2010, together with 
instructions for submitting the pre-application form electronically to 
DOT.
    Applications (Stage 2) must be submitted through Grants.gov. To 
apply for funding through Grants.gov, applicants must be properly 
registered. Complete instructions on how to register and submit 
applications can be found at http://www.grants.gov. Please be aware 
that the registration process usually takes 2-4 weeks and must be 
completed before an application can be submitted. If interested parties 
experience difficulties at any point during the registration or 
application process, please call the Grants.gov Customer Support 
Hotline at 1-800-518-4726, Monday-Friday from 7 a.m. to 9 p.m. EST. 
Additional information on applying through Grants.gov is available in 
Appendix B, attached hereto.

B. Contents of Pre-Applications

    An applicant for a TIGER II Discretionary Grant should provide all 
of the information requested below in its pre-application form. DOT 
reserves the right to ask any applicant to supplement the data in its 
pre-application, but expects pre-applications to be complete upon 
submission. Applicants must complete the pre-application form and send 
it to DOT electronically on or prior to the Pre-Application Deadline, 
in accordance with the instructions specified at http://www.dot.gov/recovery/ost/TIGERII. The pre-application form must include the 
following information:
    i. Name of applicant (if the application is to be submitted by more 
than one entity, a lead applicant must be identified);
    ii. Applicant's DUNS (Data Universal Numbering System) number;
    iii. Type of applicant (State government, local government, U.S. 
territory, Tribal government, transit agency, port authority, 
metropolitan planning organization, or other unit of government);
    iv. State(s) where the project is located;
    v. County(s) where the project is located;
    vi. City(s) where the project is located;
    vii. Project title (descriptive);
    viii. Project type: highway, transit, rail, port, multimodal, 
bicycle and pedestrian, or planning activity (if the project is a 
multimodal project, the pre-application form will require that 
applicants provide additional information identifying the affected 
modes);
    ix. Whether the project is requesting a TIGER II TIFIA Payment;
    x. Project description (describe the project in plain English terms 
that would be generally understood by the public, using no more than 50 
words (e.g. ``the project will replace the existing bridge over the W 
river on interstate-X between the cities of Y and Z'' or ``the TIGER II 
Planning Grant will fund planning activities for streetcar service from 
location X to location Y''; please do not describe the project's 
benefits, background, or alignment with the selection criteria in this 
description);
    xi. Total cost of the project;
    xii. Total amount of TIGER II Discretionary Grant funds requested;
    xiii. Contact name, phone number, e-mail address, and physical 
address for applicant;
    xiv. Congressional districts affected by the project;
    xv. Type of jurisdiction where the project is located (urban or 
rural, as defined above in Section V (Projects in Rural Areas));
    xvi. Whether or not the project is in an Economically Distressed 
Area, as defined in Section II(A) (Selection Criteria);
    xvii. An assurance that the NEPA process is complete or 
substantially complete, unless an exception is justified pursuant to 
Section II(B)(1)(b)(ii) (Environmental Approvals); absent an acceptable 
justification, DOT will not evaluate applications for projects that 
have not made substantial progress in the environmental review process, 
including all Federal, State, and local environmental requirements, by 
the Pre-Application Deadline; applicants for TIGER II Planning Grants 
do not need to demonstrate that the NEPA process has been initiated; 
and
    xviii. An assurance that local matching funds to support 20 percent 
or more of the costs of the project are identified and committed (as 
noted in Section I (Background), this requirement is waived for 
projects located in rural areas (as defined above in Section V 
(Projects in Rural Areas)), and these projects do not need to provide 
this assurance).
    To the extent the pre-application does not provide adequate 
assurances for items xvii or xviii, DOT will inform the project sponsor 
that an application for the project will not be reviewed unless the 
application submitted on or prior to the Application Deadline can 
demonstrate that the requirement has been addressed.

C. Contents of Applications

    An applicant for a TIGER II Discretionary Grant should include all 
of the information requested below in its application. DOT reserves the 
right to ask any applicant to supplement the data in its application, 
but expects applications to be complete upon submission. To the extent 
practical, DOT encourages applicants to provide data and evidence of 
project merits in a form that is publicly available or verifiable. For 
TIGER II TIFIA Payments,

[[Page 30472]]

these requirements apply only to the applications required under this 
notice; the standard TIFIA letter of interest and loan application 
requirements, including the standard $30,000.00 application fee, are 
separately described in the Program Guide and Application Form found at 
http://tifia.fhwa.dot. gov/.
1. Standard Form 424, Application for Federal Assistance
    Please see http://www07.grants.gov/assets/SF424Instructions.pdf for 
instructions on how to complete the SF-424, which is part of the 
standard Grants.gov submission. Additional clarifying guidance and FAQs 
to assist applicants in completing the SF-424 will be available at 
http://www.dot.gov/recovery/ost/TIGERII by July 30, 2010, when the 
``Apply'' function within Grants.gov opens to accept applications under 
this notice.
2. Project Narrative (Attachment to SF 424)
    The project narrative must respond to the application requirements 
outlined below. DOT recommends that the project narrative be prepared 
with standard formatting preferences (e.g. a single-spaced document, 
using a standard 12-point font, such as Times New Roman, with 1-inch 
margins).
    A TIGER II Discretionary Grant application must include information 
required for DOT to assess each of the criteria specified in Section 
II(A) (Selection Criteria), as such criteria are explained in Section 
II(B) (Additional Guidance on Selection Criteria). Applicants are 
encouraged to demonstrate the responsiveness of a project to any and 
all of the selection criteria with the most relevant information that 
applicants can provide, regardless of whether such information has been 
specifically requested, or identified, in this notice. Any such 
information shall be considered part of the application, not 
supplemental, for purposes of the application size limits identified 
below in Part D (Length of Applications). Information provided pursuant 
to this paragraph must be quantified, to the extent possible, to 
describe the project's impacts on the Nation, a metropolitan area, or a 
region. Information provided pursuant to this paragraph should include 
projections for both the build and no-build scenarios for the project 
for a point in time at least 20 years beyond the project's completion 
date or the lifespan of the project, whichever is closest to the 
present.
    All applications should include a detailed description of the 
proposed project and geospatial data for the project, including a map 
of the project's location and its connections to existing 
transportation infrastructure. An application should also include a 
description of how the project addresses the needs of an urban and/or 
rural area. An application should clearly describe the transportation 
challenges that the project aims to address, and how the project will 
address these challenges. The description should include relevant data 
such as, for example, passenger or freight volumes, congestion levels, 
infrastructure condition, or safety experience.
    DOT recommends that the project narrative generally adhere to the 
following basic outline, and include a table of contents, maps and 
graphics that make the information easier to review:
    I. Project Description (including a description of the 
transportation challenges that the project aims to address, and how the 
project will address these challenges);
    II. Project Parties (information about the grant recipient and 
other project parties);
    III. Grant Funds and Sources/Uses of Project Funds (information 
about the amount of grant funding requested, availability/commitment of 
funds sources and uses of all project funds, total project costs, 
percentage of project costs that would be paid for with TIGER II 
Discretionary Grant funds, and the identity and percentage shares of 
all parties providing funds for the project (including Federal funds 
provided under other programs));
    IV. Selection Criteria (information about how the project aligns 
with each of the primary and secondary selection criteria and a 
description of the results of the benefit-cost analysis):
    a. Long-Term Outcomes
    i. State of Good Repair
    ii. Economic Competitiveness
    iii. Livability
    iv. Sustainability
    v. Safety
    b. Job Creation and Economic Stimulus
    c. Innovation
    d. Partnership
    V. Project Readiness and NEPA (information about how ready the 
project is to move forward quickly, including information about the 
project schedule, environmental approvals, legislative approvals, state 
and local planning, technical feasibility, and financial feasibility); 
applications for TIGER II Planning Grants do not need to address 
project readiness and NEPA;
    VI. Federal Wage Rate Certification (an application must include a 
certification, signed by the applicant, stating that it will comply 
with the requirements of subchapter IV of chapter 31 of title 40, 
United States Code (Federal wage rate requirements), as required by the 
FY 2010 Appropriations Act); and
    VII. To the extent relevant, the final page of the application 
should describe (in one page or less) any material changes that need to 
be made to the pre-application form, including changes to the 
assurances provided in items xvii and xviii regarding initiation of 
NEPA and required cost sharing.
    The purpose of this recommended format is to ensure that 
applications are provided in a format that clearly addresses the 
application requirements and makes critical information readily 
apparent and easy to locate.

D. Length of Applications

    The project narrative should not exceed 25 pages in length. 
Documentation supporting the assertions made in the narrative portion 
may also be provided, but should be limited to relevant information. If 
possible, Web site links to supporting documentation (including a more 
detailed discussion of the benefit-cost analysis) should be provided 
rather than copies of these materials. At the applicant's discretion, 
relevant materials provided previously to a Cognizant Modal 
Administration in support of a different DOT discretionary program (for 
example, New Starts or TIFIA) may be referenced and described as 
unchanged. To the extent referenced, this information need not be 
resubmitted for the TIGER II Discretionary Grant application. DOT 
recommends use of appropriately descriptive file names (e.g., ``Project 
Narrative,'' ``Maps,'' ``Memoranda of Understanding and Letters of 
Support,'' etc.) for all attachments. Cover pages and tables of 
contents do not count towards the 25-page limit for the narrative 
portion of the application, and the Federal wage rate certification and 
one-page update of the pre-application form (if necessary) may also be 
outside of the 25-page narrative. Otherwise, the only substantive 
portions of the application that should exceed the 25-page limit are 
any supporting documents (including a more detailed discussion of the 
benefit-cost analysis) provided to support assertions or conclusions 
made in the 25-page narrative section.

E. Contact Information

    Contact information is requested as part of the SF-424. DOT will 
use this information to inform parties of DOT's

[[Page 30473]]

decision regarding selection of projects, as well as to contact parties 
in the event that DOT needs additional information about an 
application.

F. National Environmental Policy Act Requirement

    An application for a TIGER II Discretionary Grant must detail 
whether the project will significantly impact the natural, social and/
or economic environment. If the NEPA process is completed, an applicant 
must indicate the date of, and provide a Web site link or other 
reference to, the final Categorical Exclusion, Finding of No 
Significant Impact or Record of Decision. If the NEPA process is 
underway but not complete, the application must detail where the 
project is in the process, indicate the anticipated date of completion 
and provide a Web site link or other reference to copies of any NEPA 
documents prepared.

G. Environmentally Related Federal, State and Local Actions

    An application for a TIGER II Discretionary Grant must indicate 
whether the proposed project is likely to require actions by other 
agencies (e.g., permits), indicate the status of such actions and 
provide a Web site link or other reference to materials submitted to 
the other agencies, and/or demonstrate compliance with other Federal, 
State and local regulations as applicable, including, but not limited 
to, Section 4(f) Parklands, Recreation Areas, Refuges, & Historic 
Properties; Section 106 Historic and Culturally Significant Properties; 
Clean Water Act Wetlands and Water; Executive Orders Wetlands, 
Floodplains, Environmental Justice; Clean Air Act Air Quality 
(specifically note if the project is located in a nonattainment area); 
Endangered Species Act Threatened and Endangered Biological Resources; 
Magnuson-Stevens Fishery Conservation and Management Act Essential Fish 
Habitat; The Bald and Golden Eagle Protection Act; and/or any State and 
local requirements.

H. Protection of Confidential Business Information

    All information submitted as part of or in support of any 
application shall use publicly available data or data that can be made 
public and methodologies that are accepted by industry practice and 
standards, to the extent possible. If the application includes 
information that the applicant considers to be a trade secret or 
confidential commercial or financial information, the applicant should 
do the following: (1) Note on the front cover that the submission 
``Contains Confidential Business Information (CBI);'' (2) mark each 
affected page ``CBI;'' and (3) highlight or otherwise denote the CBI 
portions. DOT protects such information from disclosure to the extent 
allowed under applicable law. In the event DOT receives a Freedom of 
Information Act (FOIA) request for the information, DOT will follow the 
procedures described in its FOIA regulations at 49 CFR 7.17. Only 
information that is ultimately determined to be confidential under that 
procedure will be exempt from disclosure under FOIA.

IX. Project Benefits

    DOT expects to identify and report on the benefits of the projects 
that it funds with TIGER II Discretionary Grants. To this end, DOT will 
request that recipients of TIGER II Discretionary Grants cooperate in 
Departmental efforts to collect and report on information related to 
the benefits produced by the projects that receive TIGER II 
Discretionary Grants.
    The benefits that DOT reports on may include the following: (1) 
Improved condition of existing transportation facilities and systems; 
(2) long-term growth in employment, production or other high-value 
economic activity; (3) improved livability of communities across the 
United States; (4) improved energy efficiency, reduced dependence on 
oil and reduced greenhouse gas emissions; (5) reduced adverse impacts 
of transportation on the natural environment; (6) reduced number, rate 
and consequences of surface transportation-related crashes, injuries 
and fatalities; (7) greater use of innovative technology and innovative 
approaches to transportation funding and project delivery; (8) greater 
collaboration with state and local governments, other public entities, 
private entities, nonprofit entities, or other non-traditional 
partners; (9) greater integration of transportation decision making 
with decision making by other public agencies with similar public 
service objectives; or (10) any other benefits claimed in the project's 
benefit-cost analysis.
    Because of the limited nature of this program, these benefits are 
likely to be reported on a project-by-project basis and trends across 
projects that were selected for TIGER II Discretionary Grants may not 
be readily available. In addition, because many of these benefits are 
long-term outcomes, it may be years before the value of the investments 
can be quantified and fully reported. DOT is considering the most 
appropriate way to collect and report information about these potential 
project benefits.

X. Questions and Clarifications

    For further information concerning this notice please contact the 
TIGER II Discretionary Grant program manager via e-mail at 
TIGERIIGrants@dot.gov, or call Robert Mariner at 202-366-8914. A TDD is 
available for individuals who are deaf or hard of hearing at 202-366-
3993. DOT will regularly post answers to these questions and other 
important clarifications on DOT's Web site at http://www.dot.gov/recovery/ost/TIGERII.

Appendix A: Additional Information on Benefit-Cost Analysis

    As previously discussed in the Notice, the lack of a useful 
analysis of expected project benefits and costs may be a basis for 
denying an award of a TIGER II Discretionary Grant to any applicant. 
Additionally, if it is clear that the total benefits of a project are 
not reasonably likely to outweigh the project's costs, the Department 
will not award a TIGER II Discretionary Grant to the project. 
Consequently, it is incumbent upon the applicant to prepare a thorough 
benefit-cost analysis that demonstrates clearly the derivation of both 
the costs and the benefits of the project. However, DOT understands 
that the level of expense that can be expected in these analyses for 
surveys, travel demand forecasts, market forecasts, statistical 
analyses, and so on will be less for smaller projects than for larger 
projects. Smaller projects will therefore be given greater latitude to 
estimate benefits subjectively. However, even smaller projects will be 
expected to quantify these subjective estimates of benefits and costs, 
and to provide whatever evidence they have available to lend credence 
to their subjective estimates. Estimates of benefits should be 
presented in monetary terms whenever possible; if a monetary estimate 
is not possible, then at least a quantitative estimate (in physical, 
non-monetary terms, such as ridership estimates, emissions levels, 
etc.) should be provided. A benefit-cost analysis is not necessary for 
TIGER II Planning Grant applicants; however, such applicants should 
describe the expected benefits of the underlying project(s) that the 
planning activities will help advance.
    This appendix provides general information and guidance on 
conducting an analysis. In addition to this guidance, applicants should 
also refer to OMB Circulars A-4 and A-94 in preparing their analysis 
(http://www.whitehouse.gov/omb/circulars/). Circular A-4 also cites 
textbooks on

[[Page 30474]]

cost-benefit analysis (e.g., Mishan and Quah \8\) if an applicant wants 
to review additional background material. The Department will rate all 
analyses as indicated below.
---------------------------------------------------------------------------

    \8\ E.J. Mishan and Euston Quah, Cost-Benefit Analysis, 5th 
edition (New York: Routledge, 2007).

                Table 1--Ratings of Benefit-Cost Analyses
------------------------------------------------------------------------
            Rating                            Description
------------------------------------------------------------------------
Very useful..................  The economic analysis (i) is
                                comprehensive (quantifying and
                                monetizing the full range of costs and
                                benefits, including the likely timing of
                                such costs and benefits, for which such
                                measures are reasonably available), (ii)
                                attempts to describe the indirect
                                effects of transportation investments on
                                land use (when applicable), (iii) helps
                                the Department organize information
                                about, and evaluate trade-offs between,
                                alternative transportation investments,
                                (iv) provides a high degree of
                                confidence as to the extent to which the
                                benefits of the project will exceed the
                                project's costs on a net present value
                                basis, and (v) provides sensitivity
                                analysis to show how changes in key
                                assumptions affect the outcome of the
                                analysis.
Useful.......................  The economic analysis (i) identifies,
                                quantifies, monetizes, and compares the
                                project's expected benefits and costs,
                                but has minor gaps in coverage of
                                benefits and costs or the precise timing
                                of benefits and costs, or fails in some
                                cases to quantify or monetize benefits
                                and costs for which such measures are
                                reasonably available, and (ii) provides
                                a sufficient degree of confidence that
                                the benefits of the project will exceed
                                the project's costs on a net present
                                value basis.
Marginally Useful............  The economic analysis (i) identifies,
                                quantifies, monetizes, and compares the
                                project's expected benefits and costs,
                                but has significant gaps in coverage,
                                quantification, monetization, or timing
                                of benefits and costs, or significant
                                errors in its measurement of benefits or
                                costs, and (ii) the Department is
                                uncertain whether the benefits of the
                                project will exceed the project's costs
                                on a net present value basis.
Not Useful...................  The economic analysis (i) does not
                                adequately identify, quantify, monetize,
                                and compare the project's expected
                                benefits and costs or timing of benefits
                                and costs, (ii) provides little basis
                                for concluding that the benefits of the
                                project will exceed the project's costs
                                on a net present value basis, and (iii)
                                demonstrates an unreasonable absence of
                                data and analysis or poor applicant
                                effort to put forth a robust
                                quantification of net benefits.
------------------------------------------------------------------------

    A benefit-cost analysis attempts to measure the dollar value of the 
benefits and the costs to all the members of society (in this context, 
``society'' means all residents of the United States) on a net present 
value basis. The benefits represent a dollar measure of the extent to 
which people are made better off by the project--that is, the benefits 
represent the amount that all the people in the society would jointly 
be willing to pay to carry out the project, and feel as if they had 
generated enough benefits to justify the project's costs accounting for 
the relative timing of those benefits and costs. In some cases, 
benefits may be difficult to measure in dollar terms. Applicants must 
at least describe the nature of each of the major types of benefits 
described in this guidance. To the extent possible, applicants must 
also quantify each of those types of benefits (e.g., in terms of the 
number of users making use of a transportation facility). Finally, 
applicants must attempt to measure those benefits in dollar terms 
(i.e., ``monetize'' them). These benefits must then be compared with a 
dollar measure of the costs of the project. Both benefits and costs 
must be estimated for each year after work on the project is begun, and 
these streams of annual benefits and costs must be discounted to the 
present using an appropriate discount rate, so that a present value of 
the stream of benefits and a present value of the stream of costs is 
calculated.
    As a starting point for any analysis, applicants should provide a 
Project Summary describing the project and what it changes. The Project 
Summary should provide:
     A description of the current infrastructure baseline 
(e.g., two-lane road);
     A description of what the proposed project is and how it 
would change the current infrastructure baseline (e.g., extension of a 
trolley line);
     A general justification for the project and how it affects 
the long-term outcomes relative to the current baseline;
     A description of who would be the users of the project or 
what groups of people would benefit from it; and
     A description of what types of economic effects the 
project is expected to have.
    If an application contains multiple separate projects, each of 
which has independent utility, the applicant should provide a separate 
summary (and analysis) for each project. The summary should also 
identify the types of societal benefits the project might generate. The 
applicant should list the types of benefits here and then clearly 
demonstrate in the analysis how it estimated benefits for each 
category. The summary should also include the full cost of a project, 
including Federal, State, local, and private funding, and not simply 
the requested grant amount or the local amount.
    Each application must include in its analysis estimates of the 
project's expected benefits with respect to each of the five long-term 
outcomes specified in Section II(A) (Selection Criteria). We recognize 
that it may in some cases be unclear in which of these categories of 
outcomes a benefit should be listed. In these cases, it is less 
important in which category a benefit is listed than to make sure that 
the benefit is listed and measured (but only once). Applicants must 
demonstrate that the proposed project has independent utility as 
defined in this Notice. It cannot be a component of a larger project 
such that, if the larger project were not built, this project would 
have little or no transportation value (or, if it is part of a larger 
project, the application must demonstrate that funding for the larger 
project is committed). If the applicant provides a benefit-cost 
analysis for a larger project, then it must estimate what portion of 
the benefits and costs of the larger project apply to the smaller 
project for which funding is being sought. The following sections 
describe baselines, affected population,

[[Page 30475]]

discounting, forecasting, costs, and benefit categories in more detail. 
The Department expects a thorough discussion of these items in the body 
of the analysis.

Benefit-Cost Analysis vs. Economic Impact Analysis

    First, it is important to recognize that a benefit-cost analysis is 
not an economic impact analysis. Applicants are required to provide a 
benefit-cost analysis in support of their proposed projects. An 
economic impact analysis is not a substitute for a benefit-cost 
analysis.
    A benefit-cost analysis attempts to measure the dollar value of the 
benefits and the costs to all the members of society (in this context, 
``society'' means all residents of the United States). The benefits 
represent a dollar measure of the extent to which people are made 
better off by the project--that is, the benefits represent the amount 
that all the people in the society would jointly be willing to pay to 
carry out the project, and feel as if they had generated enough 
benefits to justify the project's costs.
    An economic impact analysis, on the other hand, typically focuses 
on local and regional benefits rather than national benefits. Some of 
the benefits that are counted in an economic impact analysis, such as 
diversion of economic activity from one region of the country to 
another, represent benefits to one part of the country but costs to 
another part, so they are not benefits from the standpoint of the 
nation as a whole.
    Moreover, economic impact analyses estimate ``impacts'' rather than 
``benefits,'' and the ``impacts'' are normally quite different from the 
``benefits.'' For example, the total payroll of workers on a project is 
usually considered one of the ``impacts'' in an economic impact 
analysis. The total payroll is not a measure of the ``benefits'' of the 
project, however, for two reasons. First, a payroll is a cost to 
whoever pays the employees, at the same time that it is a benefit to 
the employees, so it is not a net benefit. Second, even for the 
employees, the employees have to work for their wages, so the amount 
they are paid is not a net benefit to them--it is a benefit only to the 
extent that they value their wages more than the cost to them of having 
to be at work every day.
    Economic impact analyses also often treat real estate investments 
induced by a project as one of the economic ``impacts.'' The full value 
of such an investment is not a ``benefit,'' however, because the 
benefit of those investments to the community in which they are made is 
balanced by the cost of the investment to the investor. Because these 
investments are a cost as well as a benefit, they are not a net benefit 
for purposes of a benefit-cost analysis.
    There is often an element of benefit in these ``impacts.'' A worker 
who gets a higher-paying job as a result of a transportation investment 
project benefits if he or she works just as hard as he or she did at 
his or her previous job but is paid more. Such projects produce 
benefits by increasing the productivity of labor. A transportation 
investment project that increases the value and productivity of land 
and thus induces real estate investment can also provide a benefit, but 
the benefit must be measured net of the cost of making the real estate 
investment. Measuring these labor productivity effects requires a 
careful analysis of the local labor market and how that market is 
changed by the transportation investment. Similarly, measuring the 
effects of transportation projects on the productivity of land requires 
a careful netting out of increases in land values that are compensated 
by costs of real estate investment and increases in land values that in 
effect capitalize other types of benefits that have already been 
counted, such as time savings.
    In summary, applicants must be careful to measure only the net 
benefits of a project, and should avoid using software packages that 
are designed primarily to produce economic impact analyses. An 
application containing only an economic impact analysis does not meet 
the program's requirements and may be denied an award for that reason.

Baselines and Alternatives

    Applicants should measure costs and benefits of a proposed project 
against a baseline (also called a ``base case'' or a ``no build'' 
case). The baseline should be an assessment of the way the world would 
look if the project did not receive the requested TIGER II 
Discretionary Grant funding. Usually, it is reasonable to forecast that 
that baseline world resembles the present state. However, it is 
important to factor in any projected changes (e.g., baseline economic 
growth, increased traffic volumes, or completion of already planned and 
funded projects) that would occur even if the proposed project were not 
funded. In some cases the proposed project already has a financing plan 
that would allow it to be built, but that involves a slower 
construction schedule than would occur if it received TIGER II 
Discretionary Grant funding. Or it may be likely that, in the absence 
of TIGER II Discretionary Grant funding, the project would be built 
later using ordinary funding sources. In these cases, the TIGER II 
Discretionary Grant funding may accelerate completion of the project, 
but it does not allow a project to be built that would never otherwise 
have been built. The benefits and costs in this case should thus be 
limited to the marginal benefits (and marginal costs) of having the 
project completed in a shorter period of time and including the cost of 
expending resources on the project sooner than otherwise planned.
    Many projects have multiple parts or multiple phases, only one or 
two of which would actually receive funding from a TIGER II 
Discretionary Grant. It is important in these cases that both the costs 
and the benefits pertain to the same portion of the project. If the 
part or phase of the project funded by a TIGER Discretionary Grant has 
independent utility, then the analysis should compare the costs and the 
benefits of just that part or phase. If the part or phase of the 
project funded by a TIGER Discretionary Grant does not have independent 
utility, then the applicant must first demonstrate that funding is 
committed for the entire project (or for an entire portion of the 
project, including the TIGER Discretionary Grant-funded portion, that 
has independent utility). In this case, the applicant should compare 
the benefits and costs of the entire project (or the entire portion of 
the project that has independent utility). The applicant must make 
clear exactly what portions of the project form the basis of the 
estimates of benefits and costs. It is incorrect to claim benefits from 
time savings accruing from a 100-mile highway when the TIGER II 
Discretionary Grant will only fund 10 miles. Similarly, it would be 
incorrect to attribute all the benefits from a new port facility to a 
TIGER II Discretionary Grant when the TIGER Discretionary Grant-grant-
funded portion only pays for pavement. In some cases, the applicant may 
choose to allocate the benefits of the project proportionately to the 
costs of the project that would be funded by the TIGER II Discretionary 
Grant, but this should generally be done only if (1) the TIGER 
Discretionary Grant funds are commingled with non-TIGER Discretionary 
Grant funds for a single, non-divisible structure that has independent 
utility and (2) the project has sufficient funding in place to be 
completed as a whole unit. If a project is being funded by multiple 
Federal, State, and local sources, it would be inappropriate to 
attribute the full benefit of the project to only one source of funding 
(such as the local share or the TIGER II Discretionary Grant itself).

[[Page 30476]]

    All costs and benefits of the project should be evaluated, 
including benefits and costs that fall outside of the jurisdiction 
sponsoring the project. It is also important that the applicant assume 
the continuation of reasonable and sound management practices in 
establishing a baseline. Assuming a baseline scenario in which the 
owner of the facility does no maintenance on the facility and ignores 
traffic problems and maintenance is not realistic and will lead to the 
overstatement of project benefits.
    In addition to the baseline, the applicant should present and 
consider reasonable alternatives in the analysis. Smaller-scale and 
more focused projects should be evaluated for comparison purposes. For 
example, if an applicant is requesting funds to replace a pier, it 
should also analyze the alternative of rehabilitating the current pier. 
Similarly, if an applicant seeks funds to establish a relatively large 
streetcar project, it should also evaluate a more focused project 
serving only the more densely populated corridors or an area.

Affected Population

    Applicants should clearly identify the population that the project 
will affect and measure the number of passengers (for a passenger 
project) and the amount of freight (for a freight project) affected by 
the project. If possible, passenger and freight traffic should be 
measured in passenger-miles and freight ton-miles (and possibly value 
of freight). If, as is often the case (e.g., projected growth in 
highway traffic), the forecasted traffic volume is not the same for all 
years, then the applicant needs to break out the forecasted traffic 
annually. In some cases, the characteristics of the passenger 
population or of the freight shipper population may be important (e.g., 
whether the passengers or shippers are members of a disadvantaged 
group, or whether the passengers or shippers are spread across a multi-
state region). Measures of freight traffic might include growing levels 
of port calls. In some cases, the relevant population is the volume of 
traffic that is diverted from one mode to another. Applicants must 
clearly identify which population will be affected by any particular 
benefit. For example, the affected population that will enjoy travel 
time savings may be different from the affected population benefiting 
from reduced shipping costs. Further, the applicant should be realistic 
as to how the project affects these populations. For example, improving 
rail access to a wholesale distribution center near an urban area may 
take some trucks off the road that had been carrying freight from a 
truck/rail intermodal yard to the wholesale distribution center. 
However, it is unrealistic to claim benefits from reduced truck traffic 
all the way from the shipping origin point hundreds or thousands of 
miles away to the truck/rail intermodal yard, if that traffic would be 
likely to be moving by rail already.

Discounting

    Applicants should discount future benefits and costs to present 
values using a real discount rate of 7 percent, following guidance 
provided by OMB in Circulars A-4 and A-94 (http://www.whitehouse.gov/omb/circulars_default/). Applicants may also provide an alternative 
analysis using a real discount rate of 3 percent. The latter approach 
should be used when the alternative use of funds currently dedicated to 
the project would be other public expenditures, rather than private 
investment.
    As a first step, applicants should present the year-by-year stream 
of benefits and costs from the project. Applicants should clearly 
identify when they expect costs and benefits to occur. The beginning 
point for the year-by-year stream of benefits should be the first year 
in which the project will start generating costs or benefits. The 
ending point should be far enough in the future to encompass all of the 
significant costs and benefits resulting from the project but not to 
exceed the usable life of the asset without capital improvement.\9\ In 
presenting these year-by-year streams, applicants should measure them 
in constant (or ``real'') dollars prior to discounting. Applicants 
should not add in the effects of inflation to the estimates of future 
benefits and costs prior to discounting. Once an applicant has 
generated the stream of costs and benefits in constant dollars, it 
should then discount these estimates to arrive at a present value of 
costs and benefits. The standard formula for the discount factor in any 
given year is 1/(1 + r) \t\, where ``r'' is the discount rate and ``t'' 
measures the number of years in the future that the costs or benefits 
will occur. Infrequently, benefits or costs will be the same in 
constant dollars for all years. In these limited cases, an applicant 
can calculate the formula for the present value of an ordinary annuity 
instead of showing a year-by-year calculation.\10\
---------------------------------------------------------------------------

    \9\ In some cases the application may use a fixed term of years 
to analyze benefits and costs (e.g., 20 years), even though the 
applicant knows that the project will last longer than that and 
continue to have benefits and costs in later years. In these cases, 
the project will retain a ``residual value'' at the end of the 
analysis period. For instance, a new bridge may be expected to have 
a 100-year life but the analysis period for the benefit-cost 
analysis might cover only 40 years. In such cases, a residual value 
can be claimed as a benefit (or cost offset) for the asset at the 
end of the analysis period. One method to estimate the residual 
value is to calculate the percentage of the project that will not be 
depreciated or used up at the end of the analysis period and to 
multiply this percentage by the original cost of the project. 
Different components of the project may have different depreciation 
rates--land typically does not depreciate. The estimated residual 
value is assigned to the end of the analysis period and should then 
be discounted to its present value as would any other cost or 
benefit occurring at that time. Note that a residual value of a 
project can only be claimed if the project will be kept in operation 
beyond the end of the analysis period. If the project will be 
retired at that time, a salvage value (reflecting revenues raised 
from the decommissioning of the project) can be claimed.
    \10\ See http://www.brighthub.com/money/personal-finance/articles/17948.aspx. For example, 10.594 is the discount factor that 
would be multiplied by an annual benefit to get the present value of 
a constant benefit stream over 20 years at a discount rate of seven 
percent. If the constant annual benefit is $500,000, then the 
present value of the benefits is $5.297 million. In these limited 
cases, the applicant must show the calculation of the discount 
factor of the ordinary annuity formula.
---------------------------------------------------------------------------

Forecasting

    Benefit-cost analyses of transportation projects almost always 
depend on forecasts of projected levels of usage (road traffic, port 
calls, etc.). When an applicant is using such forecasts to generate 
benefit estimates, it must assess the reliability of these forecasts. 
If the applicant is using outside forecasts, it must provide a citation 
and an appropriate page number for the forecasts. An applicant should 
carefully review any outside forecasts for reliability before using 
them in its analyses. In cases where an applicant is using its own 
estimates, it should clearly demonstrate in the analysis the 
methodology it used to forecast affected population (e.g., traffic). 
The number of individuals who enjoy the benefits of a project will 
partly determine the net benefits of the project. Consequently, 
accurate forecasts are essential to conducting a quality benefit-cost 
analysis. Applicants should also take great care to match forecasts of 
affected population to the corresponding year. For example, using 
projected traffic levels for 2030 to generate benefits for all the 
earlier years in incorrect. For more information on forecasting, 
applicants can refer to the forecasting section of FHWA's Economic 
Analysis Primer (http://www.fhwa.dot.gov/infrastructure/asstmgmt/primer06.cfm). While produced for analysis of highway projects, the 
primer is a good source of information on issues related to all 
transportation forecasting.

[[Page 30477]]

Costs

    As noted above, the estimate of costs must pertain to the same 
project as the estimate of benefits. If the TIGER II Discretionary 
Grant is to pay for only part of the project, but the project is 
indivisible (i.e., no one part of the project would have independent 
utility), then the benefits of the whole project should be compared to 
the costs of the whole project, including costs paid for by State, 
local, and private partners other than the Federal government. 
Applicants may not claim that the TIGER II Discretionary Grant 
``leverages'' the financial contributions of other parties, and 
therefore that all the benefits of the project are attributable to the 
TIGER II Discretionary Grant, even though the TIGER II Discretionary 
Grant only pays for part of the project.
    The analysis of costs should be equally as rigorous as the analysis 
of benefits. The lack of a useful analysis of expected project costs 
may be a basis for denying the award of a TIGER II Discretionary Grant 
to an applicant. In general, applicants should use a life-cycle cost 
analysis approach in estimating the costs of the project. The 
Department expects applicants to include operating, maintenance, and 
other life-cycle costs of the project, along with capital costs. In 
addition to construction costs, other direct costs may include design 
and land acquisition. If the time period considered in the analysis is 
long enough to require the rehabilitation of the facility during the 
period of analysis, then the costs of that rehabilitation should be 
included. External costs, such as noise, increased congestion, and 
environmental pollutants resulting from the use of the facility or 
related changes in usage on other facilities in the same network, 
should be considered as costs in the analysis. Additionally, applicants 
should include, to the extent possible, costs to users during 
construction, such as delays and increased vehicle operating costs. The 
applicant should correctly discount annual costs to arrive at a present 
value of the project's cost.

Types of Benefits--Livability

    There are several potential benefits that a project could generate 
that affect livability. The most important aspect of livability is 
accessibility to non-single-occupancy vehicle modes of transportation, 
such as transit, bicycle paths, and sidewalks. Measuring the benefits 
of increased accessibility should start with a quantitative measure of 
the increase in accessibility--how many people will have access to 
these alternative modes who did not have access before? The analysis 
should go on to estimate how many people are actually likely to use 
these newly available transportation modes and how much of their 
existing single-occupancy vehicle travel are those people likely to 
divert to these alternative modes. Finally, the analysis should attempt 
to estimate the monetary value that people place on access to these 
newly available transportation modes. In some cases, monetary values 
may be estimated based on existing market transactions--e.g., bicycle 
rentals. In others, differentials in the market values of land or rents 
between residences and businesses that are already easily accessible 
(e.g.  0.5 miles) can be used as a proxy 
estimate of the value of this access. In other cases, no objective 
market values are available, and the applicant should make the best 
subjective estimate it can of the average value that this accessibility 
has to those who now have access to these alternative modes.
    Transit and bicycle paths may provide greater accessibility to 
alternative transportation modes, but they will not actually enhance 
livability unless people actually want to use them, and the desire to 
use them will depend in part on where these modes go and on the 
amenities provided with them. An important part of accessibility is 
making sure not only that people's residences are accessible to these 
modes, but that the modes connect to workplaces, schools, shopping, and 
other desired destinations. Assessments of enhanced accessibility 
should describe where these alternative modes go as well as where they 
start.
    Land use changes are also an important aspect of livability. When 
people live closer to their workplaces, their schools, and shopping, 
they will be more likely to use these alternative transportation modes. 
Transportation changes that encourage more mixed-use land development 
(where residences are intermixed with workplaces and shopping) will 
shorten the length of travel and encourage more use of non-highway 
modes. The analysis should evaluate the extent to which the proposed 
transportation project will encourage these changes in land use and be 
coordinated with zoning changes and other public and private 
investments. Changes in land use that result in shorter travel 
distances can result in long-term travel time savings, and the 
quantitative extent of these time savings can be estimated. Values of 
time can then be used to estimate the monetary value of these time 
savings. The applicant should propose a subjective estimate of the 
monetary value of land use changes. Land use changes can also reduce 
the total cost of transportation for the affected population, so 
applicants should attempt to measure the effects of the project and 
associated land use changes on average household transportation 
expenditures.
    In using differentials in property values or rents to measure the 
value of changes in accessibility, applicants must identify other 
factors that might have caused property values and/or rents to change 
and isolate the portion of the change that is attributable to the 
change in accessibility. Applicants must also be careful to avoid 
double-counting. If the applicant has already counted reductions in 
travel time as a benefit, the value of those reductions in travel time 
may get capitalized in changes in property values or rents, and the 
applicant must be careful not to count those benefits again as part of 
the change in property values.
    Finally, an important aspect of livability is the availability of 
transportation to disadvantaged communities, such as low-income people, 
non-drivers, people with disabilities, and senior citizens. Applicants 
should assess the extent to which their projects will improve 
transportation opportunities for members of these disadvantaged 
communities. While there may not be well-defined methodologies for 
assigning monetary values to these enhancements to accessibility, 
applicants should attempt to measure the size of the disadvantaged 
community affected and make subjective judgments of the monetary values 
that should be assigned to these improvements.

Types of Benefits--Economic Competitiveness

    Economic competitiveness benefits might include reduced operating 
costs due to infrastructure improvements. In some cases, a project 
produces economic competitiveness benefits because the existing users 
of the facility will have lower operating costs after the improvement 
is completed. In other cases, the economic competitiveness benefits 
result from modal diversion--users shifting from a higher-cost 
transportation mode to a lower-cost transportation mode when the 
quality of service on the lower-cost mode becomes more competitive. In 
this case, the applicant should demonstrate clearly what the basis is 
of any estimated modal diversion. In estimating operating cost savings, 
it is important to avoid double-

[[Page 30478]]

counting. For example, applicants must not count both the reductions in 
fuel costs and the overall reductions in operating costs, because fuel 
costs are part of operating costs.
    One particular form of reduced operating costs is travel time 
savings. Road improvements or other projects whose purpose is to 
relieve congestion frequently generate travel time savings for 
travelers and shippers that contribute to economic competitiveness. 
Where this is the case, applicants should clearly demonstrate how the 
travel time savings are calculated and should account for induced 
travel demand to the extent practical or applicable. If travel time 
savings vary over time, the applicant must clearly show savings by 
year. Once the applicant generates its estimate of hours saved, it 
should apply the Department's guidance on the value of time to those 
estimates (http://ostpxweb.dot.gov/policy/reports.htm) to monetize 
them.
    Freight-related projects that improve roads, rails, and ports 
frequently generate savings to shippers that they pass on to consumers 
(e.g., fuel savings and other operating cost savings). If applicants 
are projecting these savings as benefits, they need to carefully 
demonstrate how the proposed project would generate such benefits. 
However, savings to freight carriers can not be counted along with 
savings to shippers that are passed along from the carrier to the 
shipper.
    Applicants should also guard against analysis that double-counts 
other kinds of benefits. Analysis should distinguish between real 
benefits and transfer payments. Benefits reflect real resource usage 
and overall benefits to society, while transfers represent payments by 
one group to another and do not represent a net increase in societal 
benefits. Employment or output multipliers that purport to measure 
secondary effects should not be included as societal benefits because 
these secondary effects are generally the same (per dollar spent) 
regardless of what kind of project is funded.
    As noted earlier in this Appendix (see Benefit-Cost Analysis vs. 
Economic Impact Analysis), applicants must be extremely cautious about 
including job creation and economic development benefits as societal 
benefits in the benefit-cost analysis. In the case of job creation, for 
example, every job represents both a cost to the employer (paying a 
wage) and a benefit to the employee (receiving a wage), so it is a 
transfer payment, rather than a net benefit. However, if a project 
increases the productivity of labor, then the applicant can count the 
increased productivity as a benefit. For example, if the project allows 
workers working at low-productivity jobs to switch to high-productivity 
jobs, then the increase in their productivity can be counted as a 
benefit. But the applicant needs to demonstrate rigorously how such 
productivity benefits are estimated and the exact time period over 
which the productivity benefits occur. Simply asserting these gains is 
inadequate.
    With respect to economic development, estimates of capital 
investments or property tax revenues are not legitimate benefits in a 
benefit-cost analysis. A property tax is a benefit to the tax assessor, 
but it is a cost to the taxpayer. An applicant can potentially claim an 
increase in the value of land as a benefit if the transportation 
project increases the value and productivity of the land. However, the 
applicant needs to count the increase in the value of the land 
carefully to avoid double counting and transfer payments. For example, 
if the property value goes up by the exact same value as the 
developer's investment, then this is not a benefit. Property value 
increases over and above the developer's investment may potentially be 
a benefit from the project. However, if this property value increase is 
due to improved travel times that the applicant has already included as 
a benefit then there is no additional benefit here. The analysis should 
also consider to what extent an increase in land values induced by the 
project in one area causes a reduction in land values in some other 
area. Only the net increase in land value can be counted as a benefit.
    Applicants must carefully net out any embedded time savings in the 
property value increase before claiming any benefits. Simply asserting 
that there is a property tax increase net of time savings is 
inadequate. The Department expects any applicant claiming these types 
of benefits to provide a rigorous justification of the benefit that 
shows how it is derived from the project (rather than from some other 
non-project investment) and that shows how increases in property values 
attributable to other benefits (such as travel time savings) have been 
deducted. Applicants should note that any claimed societal benefit from 
a property value increase is only a one-time stock benefit. Applicants 
can not treat it as a stream of benefits accruing annually.

Types of Benefits--Safety

    Road projects can also improve the safety of transportation. A 
well-designed project can reduce fatalities and injuries as well as 
reduce other crash costs, such as hazardous materials releases. The 
applicant should clearly demonstrate how the project will improve 
safety. For example, to claim a reduction in fatalities, an applicant 
must clearly demonstrate how the existence of the project would have 
prevented the types of fatalities that commonly occur in that area. 
Applicants should use crash causation factors or similar analyses of 
causes of crashes to show the extent to which the type of improvements 
proposed would actually reduce the likelihood of the kinds of crashes 
that actually had occurred. Alternatively, when only a few cases are 
involved, the applicant should provide a description of the incidents 
and demonstrate the linkage between the proposed project and crash 
reduction. In some cases, safety benefits may occur because of modal 
diversion from a less safe mode to a more safe mode. When this type of 
benefit is claimed, the applicant should provide a clear analysis of 
why the forecasted modal diversion will take place. Once the applicant 
has established a reasonable count of the incidents that are likely to 
be prevented by the project, it should apply the Department's guidance 
on value of life and injuries (http://ostpxweb.dot.gov/policy/reports.htm) to monetize them. Sources of information on the social 
benefits of reducing crash costs are discussed in Chapter VIII of the 
Final Regulatory Impact Analysis of the National Highway Traffic Safety 
Administration's rulemaking on Corporate Average Fuel Economy for MY 
2011 Passenger Cars and Light Trucks (http://www.nhtsa.dot.gov/portal/site/nhtsa/menuitem.d0b5a45b55bfbe582f57529cdba046a0/). The economic 
values of various benefits are summarized in Table VIII-5 on page VIII-
60.

Types of Benefits--State of Good Repair

    Many infrastructure projects that improve the state of good repair 
of transportation infrastructure can reduce long-term maintenance and 
repair costs. These benefits are in addition to the benefits of 
reductions in travel time, shipping costs, and crashes which the 
applicant should account for separately. Applicants should include 
these maintenance and repair savings as benefits. Improving state of 
good repair may also reduce operating costs and congestion by reducing 
the amount of time that the infrastructure is out of service due to 
maintenance and repairs, or may prevent a facility (such as a bridge) 
from being removed from service entirely. In the latter case, the 
analysis should include a reasonable assessment of the cost that 
closing the facility would have on system users who would

[[Page 30479]]

be required to take longer and more circuitous routes, as well as the 
probability (and likely time in the future) when the bridge would need 
to be closed. The application should also consider differences in 
maintenance and repair costs when comparing different project 
alternatives. For example, an applicant can compare the maintenance 
costs that would be required after rehabilitating an existing pier with 
those that would be required after building a new one. As part of the 
data that go into estimating the benefits of improving the state of 
good repair, applicants should provide accepted metrics for assessing 
an asset's current condition. For example, applicants can use Present 
Serviceability Ratings (PSR) to discuss pavement condition and bridge 
sufficiency ratings to discuss the condition of a bridge. As discussed 
in the section on costs, the Department expects applicants to consider 
the life-cycle costs of the project when making these comparisons.

Types of Benefits--Sustainability

    Transportation can generate environmental costs in the form of 
emissions of ``criteria pollutants'' (e.g., SOX, 
NOX, and particulates) and from the emission of greenhouse 
gases, such as carbon dioxide (CO2). Increased traffic 
congestion results in increased levels of these emissions. 
Transportation projects that reduce congestion can reduce these 
emissions and produce societal benefits given reduced idling and 
otherwise constant vehicle miles travelled. Also, transportation 
projects that encourage transportation users to shift from more-
polluting modes to less-polluting modes can similarly reduce emissions. 
Applicants claiming these types of benefits must clearly demonstrate 
and quantify how the project will reduce emissions. Once an applicant 
has adequately quantified levels of emission reductions, it should 
estimate the dollar value of these benefits. Sources of information on 
the social benefits of reducing criteria pollutant emissions are 
discussed in Chapter VIII of the Final Regulatory Impact Analysis of 
the National Highway Traffic Safety Administration's rulemaking on 
Corporate Average Fuel Economy for MY 2011 Passenger Cars and Light 
Trucks (http://www.nhtsa.dot.gov/portal/site/nhtsa/menuitem.d0b5a45b55bfbe582f57529cdba046a0/).
    The Interagency Working Group on Social Cost of Carbon has recently 
issued its guidance on ``Social Cost of Carbon for Regulatory Impact 
Analysis Under Executive Order 12866'' (http://www1.eere.energy.gov/buildings/appliance_standards/commercial/pdfs/sem_finalrule_appendix15a.pdf). This guidance lays out a range of values to use for 
monetizing the social cost of carbon at various years in the future and 
at various discount rates. Applicants should clearly indicate how and 
to what degree calculations of benefits in their analyses are based on 
these assumed values of CO2 emissions reduction.

Transparency and Reproducibility of Calculations

    Applicants should make every effort to make the results of their 
analyses as transparent and reproducible as possible. Applicants should 
clearly set out basic assumptions, methods, and data underlying the 
analysis and discuss any uncertainties associated with the estimates.
    A Department reviewer reading the analysis should be able to 
understand the basic elements of the analysis and the way in which the 
applicant derived the estimates. If the application refers the reader 
to more detailed documentation to explain how the calculations were 
done, that documentation must go beyond merely providing spreadsheets. 
It must include a thorough verbal description of how the calculation 
was done, including references to tabs and cells in the spreadsheet. 
This verbal description should include specific sources for all the 
numbers in the spreadsheet that are not calculated from the spreadsheet 
itself.
    If an applicant uses a ``pre-packaged'' economic model to calculate 
net benefits, the applicant should provide annual benefits and costs by 
benefit and cost type for the entire analysis period. In any case, 
applicants must provide a detailed explanation of the assumptions used 
to run the model (e.g., peak traffic hours and traffic volume during 
peak hours, mix of traffic by cars, buses, and trucks, etc.). The 
applicant must provide enough information so that a Department reviewer 
can follow the general logic of the estimates (and, in the case of 
spreadsheet models, reproduce them).
    Ideally, the applicant should be able to summarize the results of 
all pertinent data and cost and benefit calculations in a single 
spreadsheet tab (or table in Word). A Department reviewer should be 
able to understand the calculations in spreadsheet models both from 
directions in the spreadsheet and any accompanying text. The following 
provides a simplified example for expository purposes of discounted 
costs and benefits from a road project providing travel time savings 
only to local travelers over the course of five years following a one-
year period of construction.

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                   Operations &
                                                                       Project       Affected       Travel Time   Total value of   Initial costs    maintenance    Undiscounted    Discounted at
                           Calendar year                                 year         drivers     saved  (hours)    time saved        ($2008)     costs  ($2008)   net benefits         7%
                                                                                                        \1\         ($2008) \2\                         \3\
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
2011...............................................................            1  ..............  ..............  ..............     $38,500,000      $6,000,000     $44,500,000    -$41,588,785
2012...............................................................            2          80,000       1,040,000     $14,248,000  ..............        $700,000     $13,548,000     $11,833,348
2013...............................................................            3          95,000       1,235,000     $16,919,500  ..............        $700,000     $16,219,500     $13,239,943
2014...............................................................            4         100,000       1,300,000     $17,810,000  ..............        $700,000     $17,110,000     $13,053,137
2015...............................................................            5         102,000       1,326,000     $18,166,200  ..............        $700,000     $17,466,200     $12,453,159
2016...............................................................            6         109,000       1,417,000     $19,412,900  ..............        $700,000     $18,712,900     $12,469,195
NPV................................................................  ...........  ..............  ..............  ..............  ..............  ..............  ..............     $21,459,998
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Number of drivers times three minutes a day (3/60 hours) over 260 workdays.
\2\ Hours at $13.70 per hour ($2008).
\3\ Includes costs from delays to users during construction.

    Most applicant analyses will be more complicated than this example 
and will likely include several benefit categories. However, the 
summary cost and benefit data should be as transparent and as easy to 
follow and replicate as the example above.

[[Page 30480]]

Appendix B: Additional Information on Applying Through Grants.gov

    Applications (Stage 2) for TIGER II Discretionary Grants must be 
submitted through Grants.gov. To apply for funding through Grants.gov, 
applicants must be properly registered. Complete instructions on how to 
register and apply can be found at http://www.grants.gov. If interested 
parties experience difficulties at any point during registration or 
application process, please call the Grants.gov Customer Support 
Hotline at 1-800-518-4726, Monday-Friday from 7 a.m. to 9 p.m. EST.
    Registering with Grants.gov is a one-time process; however, 
processing delays may occur and it can take up to several weeks for 
first-time registrants to receive confirmation and a user password. It 
is highly recommended that applicants start the registration process as 
early as possible to prevent delays that may preclude submitting an 
application by the deadlines specified. Applications will not be 
accepted after the relevant due date; delayed registration is not an 
acceptable reason for extensions. In order to apply for TIGER II 
Discretionary Grant funding under this announcement and to apply for 
funding through Grants.gov, all applicants are required to complete the 
following:
    1. Acquire a DUNS Number. A DUNS number is required for Grants.gov 
registration. The Office of Management and Budget requires that all 
businesses and nonprofit applicants for Federal funds include a DUNS 
(Data Universal Numbering System) number in their applications for a 
new award or renewal of an existing award. A DUNS number is a unique 
nine-digit sequence recognized as the universal standard for 
identifying and keeping track of entities receiving Federal funds. The 
identifier is used for tracking purposes and to validate address and 
point of contact information for Federal assistance applicants, 
recipients, and sub-recipients. The DUNS number will be used throughout 
the grant life cycle. Obtaining a DUNS number is a free, one-time 
activity. Obtain a DUNS number by calling 1-866-705-5711 or by applying 
online at http://www.dunandbradstreet.com.
    2. Acquire or Renew Registration With the Central Contractor 
Registration (CCR) Database. All applicants for Federal financial 
assistance maintain current registrations in the Central Contractor 
Registration (CCR) database. An applicant must be registered in the CCR 
to successfully register in Grants.gov. The CCR database is the 
repository for standard information about Federal financial assistance 
applicants, recipients, and sub-recipients. Organizations that have 
previously submitted applications via Grants.gov are already registered 
with CCR, as it is a requirement for Grants.gov registration. Please 
note, however, that applicants must update or renew their CCR 
registration at least once per year to maintain an active status, so it 
is critical to check registration status well in advance of relevant 
application deadlines. Information about CCR registration procedures 
can be accessed at http://www.ccr.gov.
    3. Acquire an Authorized Organization Representative (AOR) and a 
Grants.gov Username and Password. Complete your AOR profile on 
Grants.gov and create your username and password. You will need to use 
your organization's DUNS Number to complete this step. For more 
information about the registration process, go to http://www.grants.gov/applicants/get_registered.jsp.
    4. Acquire Authorization for Your AOR From the E-Business Point of 
Contact (E-Biz POC). The E-Biz POC at your organization must log in to 
Grants.gov to confirm you as an AOR. Please note that there can be more 
than one AOR for your organization.
    5. Search for the Funding Opportunity on Grants.gov. Please use the 
following identifying information when searching for the TIGER II 
funding opportunity on Grants.gov. The Catalog of Federal Domestic 
Assistance (CFDA) number for this solicitation is 20.933, titled 
Surface Transportation Infrastructure Discretionary Grants for Capital 
Investments II.
    6. Submit an Application Addressing All of the Requirements 
Outlined in This Funding Availability Announcement. Within 24-48 hours 
after submitting your electronic application, you should receive an e-
mail validation message from Grants.gov. The validation message will 
tell you whether the application has been received and validated or 
rejected, with an explanation. You are urged to submit your application 
at least 72 hours prior to the due date of the application to allow 
time to receive the validation message and to correct any problems that 
may have caused a rejection notification.

    Note: When uploading attachments please use generally accepted 
formats such as .pdf, .doc, and .xls. While you may imbed picture 
files such as .jpg, .gif, .bmp, in your files, please do not save 
and submit the attachment in these formats. Additionally, the 
following formats will not be accepted: .com, .bat, .exe, .vbs, 
.cfg, .dat, .db, .dbf, .dll, .ini, .log, .ora, .sys, and .zip.

Experiencing Unforeseen Grants.gov Technical Issues

    If you experience unforeseen Grants.gov technical issues beyond 
your control that prevent you from submitting your application by the 
deadline, you must contact Robert Mariner at 202-366-8914 or 
Robert.Mariner@dot.gov within 24 hours after the deadline and request 
approval to submit your application. At that time, DOT staff will 
require you to e-mail the complete grant application, your DUNS number, 
and provide a Grants.gov Help Desk tracking number(s). After DOT staff 
review all of the information submitted as well as contacts the 
Grants.gov Help Desk to validate the technical issues you reported, DOT 
staff will contact you to either approve or deny your request to submit 
a late application. If the technical issues you reported cannot be 
validated, your application will be rejected as untimely.
    To ensure a fair competition for limited discretionary funds, the 
following conditions are not valid reasons to permit late submissions: 
(1) Failure to complete the registration process before the deadline 
date; (2) failure to follow Grants.gov instructions on how to register 
and apply as posted on its Web site; (3) failure to follow all of the 
instructions in the funding availability notice; and (4) technical 
issues experienced with the applicant's computer or information 
technology (IT) environment.

    Issued on: May 26, 2010.
Ray LaHood,
Secretary.
[FR Doc. 2010-13078 Filed 5-28-10; 8:45 am]
BILLING CODE 4910-9X-P
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