76864 Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations

DEPARTMENT OF TRANSPORTATION

Federal Transit Administration

49 CFR PART 611

[Docket No. FTA 99–5474]

RIN 2132–AA63

Major Capital Investment Projects

AGENCY: Federal Transit Administration

(FTA), DOT.

ACTION: Final rule.

SUMMARY: The Transportation Equity

Act for the 21st Century (TEA–21)

requires the Federal Transit

Administration (FTA) to issue

regulations on the manner in which

candidate projects for capital

investment grants and loans for new

fixed guideway systems and extensions

to existing systems (‘‘new starts’’) will

be evaluated and rated. This rule

describes the procedures that FTA will

use in the project evaluation and rating

process. This rule will enable FTA and

Congress to identify those new starts

projects that should be considered for

funding, in part, by the Federal

government.

DATES: This rule will become effective

on February 5, 2001, except for

paragraphs (a)(1)(i)–(ii) and (d) of

Appendix A to Part 611 which will

become effective on September 1, 2001.

Affected parties do not have to comply

with the information collection

requirements until FTA publishes in the

Federal Register the control numbers

assigned by the Office of Management

and Budget (OMB) to these information

collection requirements.

FOR FURTHER INFORMATION CONTACT: For

program issues, John Day, Office of

Policy Development, FTA, (202) 366–

4060. For legal issues, Scott A. Biehl,

Assistant Chief Counsel, FTA, (202)

366–4063.

SUPPLEMENTARY INFORMATION:

Electronic Access

Electronic access to this and other

documents is available through FTA’s

home page on the World Wide Web, at

http://www.fta.dot.gov.

Internet users can access all

comments received by the U.S. DOT

Dockets, Room PL–401, via the Docket

Management System (DMS) on the DOT

home page, at http://dms.dot.gov. The

DMS is available 24 hours each day, 365

days each year. Please follow the

instructions online for more information

and help.

An electronic copy of this document

may be downloaded using a modem and

suitable communications software from

the Government Printing Office’s (GPO)

Electronic Bulletin Board Service at

(202) 512–1661. Internet users may

reach the Federal Register’s home page,

at http://www.nara.gov/fedreg, and the

GPO database, at http://

www.access.gpo.gov/nara.

Table of Contents

I. Background

II. History

A. The First Policy Statement (1976)

B. Policy on Rail Transit (1978)

C. Statement of Policy on Major Urban

Mass Transportation Capital Investments

(1984)

D. Surface Transportation and Uniform

Relocation Assistance Act of 1987

(STURAA)

E. Intermodal Surface Transportation

Efficiency Act of 1991 (ISTEA)

F. Executive Order 12893 (1994)

G. Policy Discussion Paper (1994)

H. The 1996 Statement of Policy

III. Transportation Equity Act for the 21st

Century (TEA–21)

A. Significant Changes

B. Other Changes

IV. Government Performance and Results Act

of 1993

V. Outreach

VI. Section-By-Section Analysis

VII. Response to Request for Comments on

Particular Issues

VIII. Other Comments

IX. Regulatory Evaluation

X. Regulatory Process Matters

I. Background

The Federal Transit Administration

(FTA) is issuing this rule to carry out

the requirements of section 3009(e)(5) of

TEA–21. This rule defines the process

FTA will use to evaluate candidate new

starts projects proposed for funding

under 49 USC § 5309.

The Notice of Proposed Rulemaking

(NPRM) for this Rule was issued on

April 7, 1999 (64 FR 17062). The period

for public comment closed on July 6,

1999, though late-filed comments were

accepted through July 19. See docket

#FTA–99–5474.

These procedures replace those in

force since the December 19, 1996

Federal Register Notice (61 FR 67093),

and the November 12, 1997

amendments to this Notice (62 FR

60756), which described the measures

used by FTA to evaluate candidate

projects for discretionary new starts

funding under the statutory criteria in

effect at that time.

This rule, together with the FTA/

Federal Highway Administration

(FHWA) planning and environmental

regulations at 23 CFR parts 450 and 771,

will flesh out the requirements of 49

USC 5309(e) under TEA–21. The statute

now requires candidate projects to be

‘‘(A) based on the results of an

alternatives analysis and preliminary

engineering, (B) justified based on a

comprehensive review of its mobility

improvements, environmental benefits,

cost effectiveness, and operating

efficiencies, and (C) supported by an

acceptable degree of local financial

commitment, including evidence of

stable and dependable financing sources

to construct, maintain, and operate the

system or extension.’’ This rule sets

forth the approach FTA will use to

evaluate candidate projects in terms of

their justification and local financial

commitment. Consistent with 49 USC

5309(e)(6), as amended by section

3009(e) of TEA–21, these procedures

will be used to approve candidate

projects for entry into preliminary

engineering and final design. These

procedures will also be used to evaluate

projects in order to make

recommendations for funding in the

annual report to Congress required by

49 USC 5309(o)(1).

This rule describes the project

evaluation and rating process; it does

not define the process by which FTA

determines annual project funding

recommendations, nor does it define the

process by which FTA enters into

funding commitments through Full

Funding Grant Agreements (FFGAs).

These processes are beyond the scope of

this rule. The ratings developed under

this rule are intended to denote overall

project merit, and will form the basis for

such funding decisions; however, actual

funding decisions will also involve

consideration of the amounts of new

starts funding available under section

5309 (both annually and over the

authorization period), proposed

projects’ phase of project development,

geographical factors, and any

outstanding issues that may affect the

viability of a proposed project. For

purposes of annual budget

recommendations to Congress, proposed

new starts projects must also be likely

to have completed enough of final

design that cost estimates are firm and

be likely to have in place a fully

committed financial plan by the close of

the fiscal year for which

recommendations for new Full Funding

Grant Agreements (FFGAs) are being

made.

II. History

Since the early 1970’s, the Federal

government has provided a large share

of the Nation’s capital investment in

urban mass transportation, particularly

for ‘‘new starts’’ (major new fixed

guideway transit systems or extensions

to existing fixed guideway systems). By

the mid-1970’s, because of the

magnitude of the new start

commitments being proposed, the

Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations 76865

Department found it useful to publish a

statement of Federal policy to ensure

that the available resources would be

used in the most prudent and effective

manner.

A. The First Policy Statement (1976)

The first policy statement was issued

in 1976 (41 FR 41512 (September 22,

1976)). It introduced a process-oriented

approach with the requirement that new

start projects be subjected to an analysis

of alternatives, including a

Transportation System Management

(TSM) alternative that used no-capital

and low-capital measures to make the

best use of the existing transportation

system. The Statement also required

projects to be ‘‘cost-effective.’’

B. Policy on Rail Transit (1978)

The original policy was supplemented

in 1978 by a ‘‘Policy on Rail Transit’’

(43 FR 9428 (March 7, 1998)). This

Statement reiterated the requirement for

alternatives analysis, established

requirements for local financial

commitments to the project, established

the concept of a contract providing for

a multi-year commitment of Federal

funds, with a maximum limit of Federal

participation (the Full Funding Grant

Agreement—FFGA), and required that

local governments undertake supporting

local land use actions. This was

supplemented by a 1980 policy

statement that linked the alternatives

analysis requirement to the

Environmental Impact Statement

development process (45 FR 71986

(October 30, 1980.))

C. Statement of Policy on Major Urban

Mass Transportation Capital

Investments (1984)

These principles were reiterated and

refined in a May 18, 1984, Statement of

Policy on Major Urban Mass

Transportation Capital Investments (49

FR 21284). The major feature of this

policy statement was the introduction of

an approach for making comparisons

between competing projects. To do so,

a rating system was established under

which projects were evaluated in terms

of a cost effectiveness index of forecast

incremental cost per incremental rider

for the build alternative, compared with

the TSM alternative as the base. Further,

index threshold values were established

which projects had to pass in order to

be considered for funding. In addition,

the criteria to be used to judge local

financial commitment were spelled out.

D. Surface Transportation and Uniform

Relocation Assistance Act of 1987

(STURAA)

The principles of the 1984 policy

statement were later incorporated into

law with enactment by Congress of the

Surface Transportation and Uniform

Relocation Assistance Act of 1987

(STURAA) (Pub. L. 100–17). This act

established in law a set of criteria which

new starts projects had to meet in order

to be eligible for Federal discretionary

grants. Specifically, projects had to be

‘‘cost-effective’’ and ‘‘supported by an

adequate degree of local financial

commitment.’’ STURAA also added a

requirement for an annual report to

Congress laying out the Department’s

recommendations for discretionary

funding for new starts for the

subsequent fiscal year.

To effectuate the requirements set

forth in STURAA, on April 25, 1989

FTA (then the Urban Mass

Transportation Administration) issued a

Notice of Proposed Rulemaking (54 FR

17878). This Proposed Rule would have

codified the requirements of the 1984

Policy Statement and made the ‘‘Cost

Per New Rider’’ Index and threshold

values regulatory. However, in the FY

1990 and FY 1991 Appropriations Acts,

Congress directed that this rulemaking

not be advanced (See the Department of

Transportation and Related Agencies

Appropriations Act, 1990 (Pub. L. 101–

164) and Department of Transportation

and Related Agencies Appropriations

Act, 1991 (Pub. L. 101–516)).

Consequently, on February 3, 1993, this

proposed rulemaking was withdrawn

(58 FR 6948).

E. Intermodal Surface Transportation

Efficiency Act of 1991 (ISTEA)

The Intermodal Surface

Transportation Efficiency Act of 1991

(ISTEA) made substantial changes to the

legislative basis for the criteria used to

evaluate candidate projects.

Specifically, the original requirement

that a project be ‘‘cost-effective’’ was

expanded; the new requirement

specified that projects be ‘‘justified,

based on a comprehensive review of its

mobility improvements, environmental

benefits, cost-effectiveness, and

operating efficiencies.’’ In addition,

certain ‘‘considerations’’ and

‘‘guidelines’’ were established that were

to be taken into account in determining

how well a project met the criteria.

F. Executive Order 12893 (1994)

On January 26, 1994, the President

issued Executive Order 12893 (59 FR

4233), describing the principles which

Federal agencies are to apply in

determining how to invest in all forms

of infrastructure, including

transportation. The Executive Order

requires a systematic analysis of the

costs and benefits of proposed

investments, and sets out the parameters

for such analysis. It calls for efficient

management of infrastructure, including

a focus on the operation and

maintenance of facilities, as well as the

use of pricing to manage demand, and

calls for comparison of a comprehensive

set of options and consideration of

quantifiable and qualitative measures of

benefits for all programs.

G. Policy Discussion Paper (1994)

Thereafter, in September 1994, FTA

circulated a ‘‘policy discussion paper’’

to the transit industry and other

stakeholders for comment. This paper

detailed various approaches for

evaluating proposed projects under the

ISTEA criteria, and requested comment

on nine specific issues. Interest was

extensive, and a period of public

comment, further analysis, additional

industry input, and additional analysis

ensued.

H. The 1996 Statement of Policy

On December 19, 1996, FTA issued a

Notice in the Federal Register that

formally adopted the ISTEA project

justification criteria (61 FR 67093). This

Notice defined the criteria, established

the process, and described the measures

that would be used to evaluate

candidate projects for discretionary new

starts funding. This Notice also

established a multiple-measure method

of project evaluation, in a manner

consistent with Executive Order 12893.

This Statement of Policy was

amended on November 12, 1997, to

incorporate Departmental guidance

establishing a Department-wide

standard for valuing travel time, and

made other technical corrections (62 FR

60756).

III. Transportation Equity Act for the

21st Century (TEA–21)

On June 9, 1998, the Transportation

Equity Act for the 21st Century (TEA–

21) (Pub. L. 105–178) was enacted.

TEA–21 leaves much of past law and

policy regarding new starts intact,

including the basic project justification

criteria and the multiple-measure

method of project evaluation. However,

a number of significant changes were

introduced.

A. Significant Changes

• Integration of the Major Investment

Study (MIS) requirement into the FTA/

FHWA planning and environmental

regulations (23 CFR part 450 and 23

76866 Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations

CFR part 771), elimination of the MIS as

a separate requirement (see section 1308

of TEA–21), and required streamlining

of the environmental process (see

section 1309 of TEA–21);

• The requirement for FTA to

establish overall project ratings of

‘‘highly recommended,’’

‘‘recommended,’’ or ‘‘not

recommended;’’

• The requirement for FTA approval

for a project to advance to the final

design stage of the project development

process; and

• The requirement that FTA publish

regulations on the manner in which

proposed projects will be evaluated and

rated (the purpose of this rule).

B. Other Changes

• Several additional statutory

‘‘considerations’’ have been added to

the project evaluation process,

including the cost of sprawl,

infrastructure cost savings due to

compact land use, population density

and current transit ridership in a

corridor, and the technical capacity of

the grantee to undertake the project.

• TEA–21 expressly prohibits FTA

from considering the dollar value of

mobility improvements (see section

3010).

• The ISTEA exemptions from the

FTA statutory project evaluation

process, for proposed projects that

require less than one-third of the project

funding from 49 U.S.C. 5309 or are part

of a State Improvement Plan for air

quality, were eliminated. The

exemption remains for projects

requiring less than $25 million in 49

U.S.C. 5309 funding.

• For evaluating local financial

commitment, the consideration for local

funding beyond the required nonFederal share has been incorporated

into statute.

• A second annual report to Congress,

in addition to the existing Report on

Funding Levels and Allocations of

Funds, is now required. This new

‘‘Supplemental New Starts Report,’’ due

each August, will include updated

ratings for projects that have completed

the alternatives analysis and

preliminary engineering stages of

development since the date of the last

Report on Funding Levels and

Allocations of Funds.

IV. Government Performance and

Results Act of 1993

The Government Performance and

Results Act (GPRA) was enacted in 1993

to provide for the establishment of

strategic planning and performance

measurement in the Federal

Government. It is primarily intended to

improve Federal program effectiveness

and public accountability by promoting

a new focus on results, service quality,

and customer satisfaction.

In the NPRM for this rule, FTA

indicated an intent to develop

performance measures to evaluate our

administration of the new starts

program, and to measure the

performance of Federal new starts

investments. Both of these measures

would be incorporated into FTA’s

management of new starts projects. The

NPRM invited specific comment on

these issues, including

recommendations as to which measures

and indicators would be appropriate, as

well as appropriate timeframes for

evaluation.

Comment. FTA received a total of

three comments on the GPRA issues,

from two interest groups and one transit

industry trade association. On the

subject of FTA’s performance in

administering the new starts program,

two of the commenters recommended

that performance be measured according

to factors under FTA’s control, such as

timeliness in responding to grantee

inquiries, reporting to Congress,

uniformity of guidance, approval

actions, and the extent to which funding

recommendations are based on project

ratings. One commenter saw no benefit

to evaluating FTA’s performance in this

regard.

Only two of the three commenters

addressed the subject of new starts

follow-up evaluations, the industry

trade association and one of the two

interest groups. Both supported the

general concept of follow-up

evaluations, but provided little

additional comment. The interest group

recommended that reviews not occur

until at least after the first year of

revenue service, and not later than 15

years, suggesting ratings at 2 and 7

years. The trade association

recommended that projects be evaluated

against objectives set at time of the

decision to implement the project;

ratings should encompass a 5–10 year

operating period, and should focus on

overall performance, not ridership and

cost.

Response. The wording of the section

on GPRA in the preamble to the NPRM

may have led to confusion regarding

what FTA intends to measure, which

may account for the fact that few

comments were submitted on this issue.

In evaluating FTA’s administration of

the new starts program, the intent was

to establish measures for determining

the degree to which projects remain on

schedule and on budget once a

commitment to fund the project has

been made (i.e., an FFGA has been

executed), and to measure the success of

new starts projects once they are in

operation. This rule incorporates a twostep data collection process to meet both

of these goals. For those new starts that

are put under FFGAs, FTA will combine

before-and-after data with planning

projections to evaluate the project in

terms of four areas of interest: Capital

costs, operating costs, system utilization

(including ridership levels, service

levels, user characteristics, trip

purposes, demographics, etc.), and

external factors relevant to the project.

These data collection activities will be

considered an eligible part of the project

for funding purposes. Prior to the

execution of an FFGA, project sponsors,

as part of their final design efforts, will

have to submit a complete plan for

collection of the ‘‘before’’ data to FTA.

The actual collection of data by project

sponsors will be required before

construction begins. The FFGA will

contain a requirement for the project

sponsors to collect the ‘‘after’’ data, two

years after the project opens for revenue

service. FTA will then compare the

‘‘after’’ data with the ‘‘before’’ data, as

well as with the projections of costs,

ridership, and system utilization

characteristics made during the project

development process, to evaluate the

success of the project. Project sponsors

will also be asked to report on any

external factors that might have

influenced the costs, ridership, and

utilization factors, such as unexpected

increases or decreases in gasoline

prices, employment trends, etc.

The intent of this evaluation process

is to help to develop a greater

understanding of the actual benefits of

new starts, and support improvements

to the forecasting process. FTA

recognizes that this evaluation will

provide only a short-term ‘‘snapshot’’ of

the performance of a new fixedguideway system, and that many of the

benefits, particularly in terms of land

use, are long-term in nature. Project

sponsors are of course encouraged to

continue their data collection efforts

beyond the period two years after

opening. However, given the nature of

the appropriations and authorization

process, there is also a need for shortterm data to provide an initial

indication of the benefits of a project.

V. Outreach

The development of this Rule began

with a series of outreach sessions

conducted during the months of

September and October 1998. Three

workshops were held around the

country: One in Portland, Oregon, in

conjunction with the RailVolution

Conference on September 14, 1998; one

Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations 76867

in Washington, DC on September 25,

1998; and one in New York City, in

conjunction with the Annual Meeting of

the American Public Transit Association

(APTA) on October 8, 1998.

The purpose of these outreach

sessions was to describe the changes

made by TEA–21 to the new starts

program, discuss how we plan to

implement them, and solicit general

comment on FTA’s policies and

procedures in managing the new starts

program.

The comments received during this

outreach process were generally

supportive of our proposed approach to

this rule, including the retention of the

basic principles of the 1996 Statement

of Policy.

The NRPM for this rule was issued on

April 7, 1999. The docket was open for

public comment through July 6, 1999,

though late-filed comments were

accepted through July 19, 1999.

Comments were received from a total of

41 individuals and organizations.

During the comment period, FTA held

three additional public outreach

workshops to solicit comment on the

proposed rule; one in Toronto, Ontario

on May 24, 1999, in conjunction with

the 1999 American Public Transit

Association’s Commuter Rail/Rapid

Transit Conference; one in Oakland,

California on June 3, 1999; and one in

Washington, DC on June 8, 1999. Notes

from these workshops have been placed

in the docket for this rule (#FTA–99–

5474–48).

VI. Section-by-Section Analysis

A. Section 611.1: Purpose and Contents

This section states that this rule is

issued to meet the statutory requirement

of Title 49, United States Code, section

5309(e)(5).

This rule establishes the methodology

by which FTA will evaluate proposed

new starts projects as required by 49

U.S.C. 5309(e). The data collected as

part of the planning and project

development processes and related

regulations, conducted under 23 CFR

part 450 and 23 CFR part 771, will

provide the basis for this evaluation.

Applicants must follow these rules to be

considered eligible for capital

investment grants and loans for new

fixed guideway systems or extensions

(‘‘new starts’’).

The results of this evaluation will be

used by FTA to make the findings

required by statute for proposed projects

to advance into the preliminary

engineering and final design stages of

project development, and to develop

funding recommendations for the

President’s annual budget request. They

will also be used to determine which

projects are eligible for funding

commitments under Full Funding Grant

Agreements.

The information collected and ratings

developed under this rule will form the

basis for the annual Report on Funding

Levels and Allocations of Funds, as

required under 49 U.S.C. 5309(o)(1), and

the ‘‘Supplemental Report on New

Starts,’’ as required by 49 U.S.C.

5309(o)(2). The NPRM to this Rule

proposed cutoff dates for information to

be included in these reports; however,

FTA has reconsidered the need for

dates, as we strive for more real-time

information. Thus, the cutoff dates for

these reports have been dropped from

this rule.

B. Section 611.3: Applicability

This section states that this rule

applies only to the evaluation of

projects seeking Federal capital

investment funds for new transit fixed

guideway and extension projects (‘‘new

starts’’) under 49 U.S.C. 5309.

It also states that proposed projects

are exempt from evaluation under this

rule if the total amount of funding under

49 U.S.C. 5309 is less than $25,000,000,

or if they are specifically exempt by

statute. Such projects must still meet the

planning requirements under 23 CFR

part 450 and environmental review

requirements under 23 CFR part 771, as

well as the project development process

described in this rule.

Title 49, U.S.C. 5309(e)(7) requires

new starts projects to be carried out

through a Full Funding Grant

Agreement (FFGA), and also requires

FTA to base the decision to issue an

FFGA on the results of the evaluations

and ratings process. Thus, any proposed

project that is not evaluated will not be

eligible for an FFGA. Sponsors of

proposed projects that they believe to be

exempt are therefore strongly urged to

submit project evaluation information to

FTA. FTA will carefully review projects

for which sponsors are claiming

exemptions under this rule. Such

projects will still be approved for entry

into preliminary engineering and final

design, based on planning and project

development requirements. If the

proposed share of project funding from

the section 5309 new starts program

passes the $25 million level at any time,

FTA will expect the project sponsor to

develop the information required to be

evaluated under this rule, and will

require that such a project be funded

using an FFGA.

This section also notes that projects

for which an FFGA has already been

executed are not subject to reevaluation

under this rule. However, extensions

and/or modifications to projects with

existing FFGAs will be subject to

evaluation and rating under this rule.

Comment. FTA received six

comments on the issue of project

exemptions, expressing general

confusion and opposition to FTA’s

position on exempt projects. One

transportation consultant and one

transit operator argued that all exempt

projects should be assigned a default

rating of ‘‘medium,’’ which could be

raised by the submission of data for

evaluation; the transit operator also

expressed the opinion that small

projects (i.e., <$25 million in new starts

funds) do not generate great benefits,

and therefore should not be required to

submit data for evaluation. One State

DOT recommended that FTA simply set

aside $500 million annually for exempt

projects.

Three commenters also expressed

some degree of confusion regarding the

treatment of exempt projects. One

attendee at the Washington, DC

workshop wondered whether project

sponsors would attempt to ‘‘cheat’’ the

process by claiming exemptions and

another at the Oakland, CA workshop

expressed confusion about continued

eligibility of exempt projects for

funding. One industry interest group

commented that, since TEA–21 already

contains language exempting projects

under existing FFGAs from reevaluation under the revised criteria,

including the same language in the

Final Rule would be confusing.

Response. FTA is not prepared to set

aside half (or any amount) of the annual

new starts funding authorization for

exempt projects, and rejects the

assertion that Congress intended such

projects to be exempt from the

evaluation process because they have no

measurable benefits. The Final Rule

retains the NPRM language strongly

encouraging sponsors of projects they

believe to be exempt to submit data for

project evaluation. This encouragement

does not and is not intended to

eliminate the provisions in TEA–21

exempting certain projects from the

evaluation process, as many of the

commenters seem to have surmised.

Any proposed project that meets these

provisions is still exempt from the

evaluation and rating process; however,

submitting data will give FTA an

empirical basis on which to make

funding recommendations to Congress.

It will also maintain a proposed

project’s eligibility for an FFGA. Indeed,

49 U.S.C. 5309(e)(7) requires new starts

projects to be carried out through a Full

Funding Grant Agreement, and also

requires FTA to base the decision to

execute an FFGA on the results of the

76868 Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations

evaluations and ratings process. Thus,

any proposed project that is not

evaluated will not be eligible for an

FFGA. FTA will of course allocate any

funds appropriated by Congress for such

projects. However, we believe project

sponsors will find the more predictable

and reliable funding provided through

an FFGA to be to their advantage.

Therefore, project sponsors are

encouraged to submit data for

evaluation to retain their eligibility for

an FFGA.

Finally, FTA acknowledges that there

may be a temptation to circumvent the

project evaluation process, as noted

during the Washington, D.C. workshop.

For example, it is conceivable that

project sponsors may officially maintain

a low level of section 5309 new starts

funds throughout a project’s

development, only to ‘‘discover’’ that

additional funds will be needed as the

development process draws to a close.

FTA also recognizes that not all such

instances will result from deliberate

attempts to manipulate the process;

occasionally, further engineering and

design will uncover a legitimate need

for additional funds during the project

development process, or local funding

may not materialize as initially

proposed. However, due to the fact that

project evaluation is a condition of

eligibility for an FFGA, and that an

FFGA offers more stability in terms of

funding than relying on annual

Congressional appropriations, FTA

believes that deliberate attempts to

evade project evaluation will be few and

far between.

Although projects proposed as

‘‘exempt’’ are not subject to evaluation

against the new starts project

justification and local financial

commitment criteria, such projects must

still request FTA approval for entrance

into preliminary engineering and final

design. The decision to approve

advancement in the project

development process for such projects is

based on compliance with basic

planning, environmental, project

management, and other requirements

which apply to all projects pursuing

section 5309 new starts funding,

regardless of the amount. It is at the

preliminary engineering and final

design approval points that FTA works

with the project sponsor to determine if

the proposed ‘‘exempt’’ project appears

to be at risk for requiring new starts

funding at an amount greater that $25

million, and to seek assurances that

local or other Federal formula funds

will be pursued if a project’s cost or

funding strategy changes. Once again, in

order to preserve maximum funding

flexibility, FTA strongly encourages the

sponsors of proposed projects that they

believe to be exempt to nonetheless

submit data for evaluation.

C. Section 611.5: Definitions

This section defines key terms used in

this part.

Comment. Four commenters to the

proposed rule expressed concern that

the definition of ‘‘fixed guideway’’ was

unnecessarily narrow, and may perhaps

exclude many bus rapid transit (BRT),

ferry boat, commuter rail and light rail

systems that would operate along a

shared right-of-way.

Response. FTA has re-examined the

definition used in the NPRM, and agrees

that it could be read as excluding some

BRT and ferry projects that would

otherwise be eligible under the new

starts program. The definition used in

this rule has been modified to address

this uncertainty. Definitions for ‘‘bus

rapid transit’’ and ‘‘BRT’’ have also been

added, consistent with the definition

used in FTA’s Request for Participation

in the Bus Rapid Transit Demonstration

Program (63 FR 68347 (December 10,

1998)).

FTA has also added a definition for

‘‘Transportation System User Benefits’’

and removed the definition for the

‘‘Transportation System Management

alternative,’’ as discussed later in the

preamble to this Rule.

D. Section 611.7: Relation to Planning

and Project Development Processes

New start projects, like all

transportation investments in

metropolitan areas, must emerge from a

regional multimodal transportation

planning process in order to be eligible

for Federal funding. In addition, 49

U.S.C. 5309(e)(1) specifies that

discretionary grants or loans for new

starts may only be approved if a

proposed project is based on the results

of alternatives analysis and preliminary

engineering, and that certain project

justification and financial criteria have

been met.

As part of the metropolitan planning

process, local project sponsors must

perform a corridor-level analysis of

mode and alignment alternatives in

corridors for which projects may be

proposed for section 5309 new starts

funding. This alternatives analysis will

provide information on the benefits,

costs, and impacts of alternative

strategies, leading to the selection of a

locally-preferred alternative to the

community’s mobility needs.

The approach taken in this rule

envisions alternatives analysis as a key

planning tool to be undertaken within

the multimodal metropolitan and

statewide planning processes,

supplemented by subsequent project

development analyses, for determining

appropriate solutions to transportation

issues. FTA and FHWA are currently

modifying their joint planning and

environmental regulations to better

reflect the planning and project

development provisions of TEA–21. To

the extent possible, the development of

these regulations has been coordinated

with the development of this final rule

on major transit capital investments.

However, FTA may amend this rule, if

necessary, when the joint planning and

environmental Final Rule is issued.

Federal financial support for the

planning process is derived from a

number of sources, including the

Metropolitan Planning Program under

49 U.S.C. 5303, the State National

Planning and Research Program under

49 U.S.C. 5313, and planning programs

administered by the Federal Highway

Administration. FTA Urbanized Area

Formula funds under 49 U.S.C. 5307

and flexible funds under the Surface

Transportation Program (STP) and the

Congestion Mitigation and Air Quality

(CMAQ) Program may also be used to

support certain planning activities.

Given the significant demands placed

on the new start program, FTA does not

support the use of 49 U.S.C. 5309 funds

for initial planning activities. Moreover,

as amended by TEA–21, 49 U.S.C.

5309(m)(2) limits the amount of new

starts funding that can be used for

purposes other than final design and

construction to not more than 8 percent

of funds appropriated. In evaluating the

local financial commitment to a

proposed project, FTA will consider the

degree to which initial planning

activities are conducted without

funding from section 5309.

The alternatives analysis study (also

known as a major investment study—

MIS—or multimodal corridor analysis)

evaluates several modal and alignment

options for addressing mobility needs in

a given corridor. It is intended to

provide information to local officials on

the benefits, costs, and impacts of

alternative transportation investments.

Potential local funding sources for

implementing and operating the

investment are to be identified and

studied, and information in response to

the FTA new starts project evaluation

criteria is to be developed. Involvement

of a wide range of stakeholders—

including the general public—in the

alternatives analysis study process is

strongly encouraged. At local discretion,

the alternatives analysis may include

the undertaking of a Draft

Environmental Impact Statement (DEIS)

or Environmental Assessment (EA).

Alternatives analysis is considered

Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations 76869

complete when a locally preferred

alternative (LPA) is selected by local

and regional decisionmakers and

adopted by the metropolitan planning

organization (MPO) in its financiallyconstrained metropolitan transportation

plan.

At this point, the local project sponsor

may submit a request to the FTA

regional office to initiate the

preliminary engineering phase of project

development. The request must provide

information that demonstrates the

readiness of the project to advance into

preliminary engineering, including the

adoption of the project into the

metropolitan transportation plan and

the programming of the preliminary

engineering study in the Transportation

Improvement Plan (TIP), and

information demonstrating the technical

capability of project sponsors to

undertake the preliminary engineering

effort. The request must also address the

project justification and local financial

commitment criteria outlined below.

(This information is normally developed

as part of an alternatives analysis.) FTA

will then evaluate the proposed project

as required by 49 U.S.C. 5309(e)(6) and

determine whether or not to advance the

project into preliminary engineering.

FTA approval to initiate preliminary

engineering is not a commitment to

fund final design or construction.

Where the sponsoring agency believes

that a proposed project is exempt from

evaluation under this rule, submission

of project justification and financial

commitment information to FTA is not

required. However, exempt projects

must still meet all planning,

environmental, project management,

and other requirements which

demonstrate their readiness to advance

into preliminary engineering. In

addition, without information to

support the justification of and local

financial commitment to a proposed

project, FTA will have no basis for

decisions on whether to recommend

Federal funding commitments.

Therefore, sponsors of exempt projects

are strongly encouraged to submit

information on project justification and

financial commitment.

During the preliminary engineering

phase, local project sponsors refine the

design of the proposal, taking into

consideration all reasonable design

alternatives. Preliminary engineering

results in estimates of project costs,

benefits and impacts in which there is

a much higher degree of confidence. A

comprehensive preliminary engineering

effort will also address the evaluation

criteria described in this rule. In

addition, NEPA requirements must be

met (for new starts, this usually

includes the completion of a Final

Environmental Impact Statement),

project management plans and fleet

management plans are finalized, and

local funding sources are committed to

the project (if they have not already

been committed). Information on project

justification and the degree of local

financial commitment will be updated

and reported as appropriate. As part of

their preliminary engineering activities,

localities are encouraged to consider

policies and actions designed to

enhance the benefits of the project and

its financial feasibility.

Project sponsors should also ensure

that safety considerations are weighed

during the preliminary engineering

phase. With regard to rail projects that

will be subject to Federal Railroad

(FRA) safety jurisdiction, FTA will

notify FRA of pending new starts at the

earliest date practicable, as important

decisions affecting rail safety must be

made at the outset of the planning and

grant development process. FRA will

forward any recommendations it has to

FTA, which will forward them to the

project sponsor.

Preliminary engineering is typically

financed with 49 U.S.C. § 5303 and

§ 5307 funds, local revenues, and

flexible funds under the STP and CMAQ

programs.

Preliminary engineering is considered

complete when FTA has issued a

Record of Decision (ROD) or Finding of

No Significant Impact (FONSI), as

required by NEPA.

Proposed projects that have

completed preliminary engineering

must request FTA approval to enter the

final design phase of development. The

request must provide information that

demonstrates to FTA the technical

capability and financial capacity of the

local project sponsor to advance the

project into final design. Like the

approval to enter into preliminary

engineering, this approval is based upon

a review and evaluation of the costs,

benefits, and impacts under the

statutory project evaluation criteria.

Final design is the last phase of project

development, and includes right-of-way

acquisition, utility relocation, and the

preparation of final construction plans

(including construction management

plans), detailed specifications,

construction cost estimates, and bid

documents. Final design is typically

eligible for 49 U.S.C. 5309 new start

funds.

Comment. In the NPRM to this rule,

FTA asked for public comment on the

relationship between the alternatives

analysis requirement and the planning

and project development processes. A

total of nine comments addressed this

issue. Two respondents, a transit

industry trade association and a large

transit operator, objected to the fact that

an alternatives analysis is required for

transit new starts, but not for highway

projects. Another transit operator

objected to alternatives analysis as

‘‘outside’’ of the ‘‘normal’’ corridor

study process, topheavy and

burdensome, and inconsistent with

planning regulations.

Response. It is in fact true that Federal

highway programs do not require an

analysis of alternatives in the same

manner as the new starts program.

However, this is a fact of law, not

Departmental policy. The new starts

program is a discretionary funding

program; alternatives analyses are

required to develop information for

decisionmaking purposes. Conversely,

the Federal highway program is a

formula program; no Federal

decisionmaking is required. Neither

FTA nor DOT are at liberty to remove

the requirement for alternatives analysis

from the new starts program, or to

impose a similar requirement on the

Federal highway program. To do so

would require a change in the law by

Congress. As for the perceived

inconsistency with planning

regulations, the joint FTA/FHWA

planning regulations are designed to be

consistent for both agencies’ major

capital investment programs; they

neither require FHWA-funded projects

to undergo alternatives analysis, nor

prevent FTA-funded new starts from

meeting the statutory requirement that

an alternatives analysis be conducted.

Comment. One transit operator

commented that the issuance of this rule

should be delayed until the revisions

required by TEA–21 to the FTA/FHWA

planning and project development

regulations have been issued.

Response. This rule applies only to

FTA’s own evaluations of proposed new

starts, which does not feed into the

planning process; rather, FTA’s new

starts evaluations rely upon the data and

information derived from the planning

process. Therefore, FTA is not

persuaded that formal implementation

of the TEA–21 new starts provisions

should be delayed further. Should the

final planning rule require changes to

the new starts project development

process, however, this rule will be

amended accordingly.

Comment. Two commenters

expressed confusion regarding the

‘‘demise’’ of the Major Investment Study

(MIS), and requested clarification.

Response. Section 1308 of TEA–21

eliminated the separate requirement for

an MIS and integrated its basic concepts

into the joint planning and

76870 Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations

environmental regulations issued by

FTA and FHWA (23 CFR parts 450 and

771). Existing MIS activities will still

satisfy the requirement for an

alternatives analysis, and project

sponsors who wish to follow the

principles of the multimodal MIS to

conduct new alternatives analyses are

encouraged to do so. The joint planning

and environmental regulations will

more fully describe how the MIS

concepts will be integrated into the

process.

Comment. The NPRM noted that FTA

does not support the use of section 5309

new starts funds for initial planning

activities, given the demands placed on

the program and the availability of

funds from other FTA programs for this

purpose, and stated that FTA would

consider this when evaluating local

financial commitment. Six comments

were received on this issue. Four

commenters objected to what they

viewed as ‘‘penalizing’’ project sponsors

for using new starts funds for planning

activities relating to proposed new starts

projects; one commenter asked for

clarification as to whether such projects

would be penalized; and one (a transit

operator) supported limiting the use of

new starts funds for planning. One

transit operator, citing the statutory 8

percent limit on program funding for

activities other than final design and

construction, noted that Congress

‘‘clearly intended’’ for section 5309

funds to be used for alternatives

analysis and preliminary engineering. A

local government entity claimed that

there was no ‘‘statutory basis’’ for

including the use of section 5309 funds

for planning purposes as part of the

project evaluation process, and noted

that it would be inappropriate to

‘‘penalize’’ projects that Congress saw fit

to earmark. This same commenter

suggested measuring such uses of funds

against the 8% limit established in

TEA–21.

Response. The Final Rule retains the

principle that FTA will consider the

degree to which initial planning

activities are conducted without

funding from section 5309 as part of our

evaluation of the local financial

commitment. This is not intended as a

‘‘penalty’’ for project sponsors who seek

and secure Congressional earmarks for

these activities. Rather, it is intended to

give a degree of recognition to the efforts

of sponsors who make use of existing

sources of Federal, State, and local

planning funds, such as those noted

above. Further, making such

considerations is consistent with

Congressional direction. The conference

report to the FY 1999 appropriations act

instructed FTA to consider the extent to

which new starts project sponsors make

use of the appreciable increases in

formula funding for alternatives analysis

and preliminary engineering, when

evaluating the local financial

commitment of proposed new starts.

Comment. Twelve comments

addressed the issue of the statutory

requirement for FTA approval to

advance into preliminary engineering

and final design. Most expressed some

degree of discomfort with the notion of

such approvals, and noted a need for

more guidance and better definitions of

the stages of project development and

the development process itself. The

strongest objection was expressed by a

transit operator who asserted the project

development process is separate and

distinct from the evaluation process,

and that proposed new starts projects

should therefore simply be permitted to

proceed without FTA approval.

Response. In most cases, the

‘‘newness’’ of this approval requirement

seems to be responsible for much of the

confusion. The requirement for FTA

approval to enter final design was added

to the new starts program by TEA–21;

this rule simply implements that

requirement. FTA is not at liberty to

change the law through this or any other

rulemaking process. FTA approval has

long been required to enter into

preliminary engineering, though the role

of the project ratings process was not as

large.

Comment. Four of those commenting

on the approval requirement, including

a transit industry trade association,

requested clarification of what is

required to fulfill the requirements for

completion of the various stages of

development.

Response. The language concerning

alternatives analysis, preliminary

engineering, and final design has been

revised in both the text of this rule and

the preamble to better describe these

activities. In addition, FTA issued

guidance in September 1999 which

clarifies the project development and

approval process.

Comment. The industry trade

association also suggested that local

financial commitment not be considered

for approval to enter the next stage, a

comment echoed by a transit operator.

Another transit operator and the trade

association suggested that different

requirements be established for

approval to enter preliminary

engineering than for final design. The

apparent fear is that worthy projects

may be denied approval to enter

preliminary engineering simply because

adequate information on costs and

benefits is not available with a high

level of certainty so early in the

development process.

Response. Section 5309(e)(6) clearly

states that FTA may only approve the

advancement of a proposed project to

the next stage of development if it meets

the statutory project evaluation criteria,

and is likely to continue to do so.

However, FTA recognizes that the level

of information available and the degree

of certainty varies according to the stage

of project development; the earlier in

the process a proposed project is, the

less certain the forecasts and estimates.

For this reason, FTA sets different

standards for high, medium, and low

ratings for preliminary engineering than

for final design; the further a proposed

project is in the process, the higher the

standard. In the case of local financial

commitment, for example, it may be

sufficient to simply demonstrate a

reasonable financial plan that identifies

proposed sources of local funds needed

to construct the project (i.e., to show

that the sponsors have considered how

they intend to pay for it) when seeking

approval to enter preliminary

engineering. It is not reasonable to

expect ballot measures to have passed

and funds to have been programmed at

this stage. However, by the time a

proposed project is ready to enter final

design, most or all of the local funds

should be committed, including

provisions for cost overruns. It has been

a longstanding FTA practice in the

management of the new starts program

and the project evaluation process to

make such distinctions among the stages

of project development; this practice has

been discussed in the Annual Report on

New Starts and its predecessor, the

annual Report on Funding Levels and

Allocations of Funds, since the May

1991 edition. Further, FTA cannot

assign project ratings during alternatives

analysis, as there is essentially no

project to evaluate until the locallypreferred alternative is selected. Project

sponsors need not worry that they will

‘‘fail’’ the evaluation process simply

because their proposed project is still in

the early development stages.

Comment. The trade association and

three other commenters also requested

language clarifying that projects already

in preliminary engineering at the time

the final rule is issued have met the

requirement for alternatives analysis, as

have prior Major Investment Studies

(MISs).

Response. This rule in no way revokes

prior FTA approvals for preliminary

engineering (or final design). Language

to this effect has been added to § 611.7,

Relation to planning and project

development processes.

Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations 76871

Comment. One commenter requested

a regulation to define ‘‘major investment

studies.’’

Response. The discussion of

alternatives analysis earlier in the

preamble to this rule has been revised

to better address this issue. The pending

joint FTA/FHWA planning and

environmental regulations will more

fully describe the integration of the MIS

into the planning and environmental

process under TEA–21.

E. Section 611.9: Project Justification

Criteria

Section 5309(e)(1)(B) requires the

Secretary to determine that a proposed

new starts project is justified based on

a comprehensive review of its mobility

improvements, environmental benefits,

cost effectiveness, and operating

efficiencies. To make this

determination, FTA will evaluate

information developed through the

planning and project development

processes. The method used to make

these determinations is a multiple

measure approach in which the merits

of candidate projects will be evaluated

against a set of measures. The ratings for

each measure will be updated annually

for purposes of the annual report on

funding levels and allocations of funds

required by section 5309(o)(1), the

supplemental report required by section

5309(o)(2), and as required for FTA

approvals to enter into preliminary

engineering, final design, or FFGAs. As

a candidate project proceeds through

the stages of the project development

process, a greater degree of certainty is

expected with respect to these

measures. Measures have been

established for each of the following

criteria:

1. Mobility improvements;

2. Environmental benefits;

3. Operating efficiencies;

4. Transportation System User

Benefits (Cost Effectiveness);

5. Existing land use, transit

supportive land use policies, and future

patterns; and

6. Other factors, including:

(a) The degree to which the policies

and programs (e.g., parking policies,

etc.) are in place as assumed in the

forecasts;

(b) Project management capability;

and

(c) Additional factors relevant to local

and national priorities and relevant to

the success of the project.

For each proposed project, FTA will

assign one of five descriptive ratings

(‘‘high,’’ ‘‘medium-high,’’ ‘‘medium,’’

‘‘low-medium,’’ or ‘‘low’’) for each of

the first five criteria; information on

‘‘other factors’’ will be reported as

appropriate.

The measures for the project

evaluation criteria are described in

Appendix A to this rule. FTA may

amend or modify these measures in

response to the results of ongoing

research into methods for evaluating the

benefits of transit investments.

Comment. In the NPRM for this Rule,

FTA proposed that in all cases, the

proposed new start would be evaluated

against both a no-build and

Transportation System Management

(TSM) alternative. The retention of the

TSM was the subject of substantial

comment in response to the NPRM. A

total of 13 comments were submitted on

this issue, all of them opposed. Most of

the commenters felt that it was

unnecessarily burdensome to maintain a

TSM alternative for what they viewed as

solely FTA’s purposes, noting that

certain incremental system

improvements will occur whether the

new start is constructed or not; i.e., it is

no longer appropriate to view the nobuild alternative as a ‘‘do nothing’’

scenario. The most common suggestion

was that, if the TSM requirement is

retained, it should be dropped after

alternatives analysis has resulted in the

selection of a locally-preferred

alternative.

Response. FTA accepts the argument

that it is no longer appropriate to

assume that a no-build alternative

presents a ‘‘do nothing’’ scenario. The

realities of modern urban and suburban

planning, transportation, and economic

development make it virtually

impossible to assume that no

improvements will occur if a proposed

new start is not implemented. At the

same time, however, a consistent

baseline is needed to ensure a fair

evaluation of proposed new starts

projects nationwide. The TSM

alternative has served well in this

regard.

In response to comments submitted

on this issue and in recognition of the

desire to simplify the new starts

process, this Rule eliminates the

requirement for separate no-build and

TSM alternatives, and instead requires

that the proposed new start be evaluated

against a single ‘‘baseline alternative.’’

The baseline alternative is best

described as transit improvements lower

in cost than the proposed new start,

which result in a better ratio of

measures of transit mobility compared

to cost than the no build alternative; the

‘‘best you can do’’ without the new start

investment. The purpose of the baseline

comparison is to isolate the costs and

benefits of the proposed major transit

investment. At a minimum, the baseline

alternative must include in the project

corridor all reasonable cost-effective

transit improvements short of

investment in the new start project.

Depending on the circumstances and

through prior agreement with FTA, the

baseline alternative can be defined

appropriately in one of three ways.

First, where the adopted financially

constrained regional transportation plan

includes within the corridor all

reasonable cost-effective transit

improvements short of the new start

project, a the no-build alternative that

includes those improvements may serve

as the baseline. Second, where

additional cost-effective transit

improvements can be made beyond

those provided by the adopted plan, the

baseline will incorporate those costeffective transit improvements as well.

Third, where the proposed new start

project is part of a multimodal

alternative that includes major highway

components, the baseline alternative

will be the preferred multimodal

alternative without the new start project

and associated transit services. Prior to

submittal of a request to enter

preliminary engineering for the new

start project, grantees must obtain FTA

approval of the definition of the

baseline alternative.

Consistent with the requirement that

differences between the new start

project and the baseline alternative

measure only the benefits and costs of

the project itself, planning factors

external to the new start project and its

supporting bus service must be the same

for both the baseline and new start

project alternatives. Consequently, the

highway and transit networks defined

for the analysis must be the same

outside the corridor for which the new

start project is proposed. Further,

policies affecting travel demand and

travel costs, such as land use, transit

fares and parking costs, must be applied

consistently to both the baseline

alternative and the new start project

alternative.

The Final Rule has been rewritten to

substitute ‘‘baseline alternative’’

wherever ‘‘no-build and TSM

alternatives’’ appeared in the NPRM,

and a definition for ‘‘baseline

alternative’’ has been added.

‘‘Existing land use, transit supportive

land use policies, and future patterns’’

is not listed among the project

justification criteria contained in 49

U.S.C. 5309(e)(1)(B), but is listed as one

of the ‘‘considerations’’ under 49 U.S.C.

5309(e)(3) that FTA must take into

account when determining a proposed

project’s ‘‘justification.’’ Consistent with

past practice, we have included land

use among the project justification

76872 Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations

criteria for a number of reasons. Transitsupportive land use, whether it is a

factor of existing patterns, existing local

policies, or planned future development

which targets development around the

Federally-assisted project, has been an

important indicator of future project

success. Additionally, TEA–21 added

two new land-use-related considerations

to the project evaluation process: The

reduction in local infrastructure costs

achieved through compact land use

development (49 U.S.C. 5309(e)(3)(B)),

and the cost of suburban sprawl (49

U.S.C. 5309(e)(3)(C)). This appears to be

a clear intent by Congress to give

additional attention to this issue. The

NPRM for this Rule labeled the land use

criteria as ‘‘transit supportive existing

land use policies and future patterns.’’

This has been changed to ‘‘existing land

use, transit supportive land use plans,

and future patterns’’ in this Rule, to

more accurately reflect FTA’s practices

in evaluating land use issues relating to

proposed new starts. The underlying

factors described in paragraph (e) of

Appendix A to this rule have been

revised in response to this change.

In making the determination of

project justification, 49 U.S.C. 5309(e)(3)

requires the FTA to consider a variety

of factors, as follows:

1. The direct and indirect costs of

relevant alternatives;

2. Factors such as congestion relief,

improved mobility, air pollution, noise

pollution, energy consumption, and all

associated ancillary and mitigation costs

necessary to carry out each alternative

analyzed;

3. Existing land use, mass

transportation-supportive land use

policies, future patterns, and the cost of

suburban sprawl;

4. The degree to which the project

increases the mobility of the mass

transportation dependent population or

promotes economic development;

5. Population density and current

transit ridership in the corridor;

6. The technical capability of the

grant recipient to construct the project;

7. Differences in local land,

construction, and operating costs; and

8. Other factors that the Secretary

determines appropriate.

This represents a modest expansion of

the ‘‘considerations’’ established by

ISTEA. Specifically, section 3009(e) of

TEA–21 added the consideration for the

cost of suburban sprawl noted in (3)

above; for population density and

current transit ridership in the corridor

in (5) above; and for the technical

capacity of the grantee to carry out the

proposed project in (6) above. The

‘‘considerations’’ serve to illustrate the

project justification criteria, providing

further detail on specific information

that should be collected and how the

criteria should be evaluated. Much of

the data required to consider these

factors is already developed as part of

the existing planning and project

development processes, however, as

required under 23 CFR part 450 and 23

CFR part 771. FTA believes these

considerations are already adequately

addressed by the current project

justification criteria and measures.

When evaluating proposed new starts

projects, FTA will apply these criteria to

the project as proposed for Federal

funding under 49 U.S.C. section 5309.

This means that if local project sponsors

are seeking new starts funding at this

time for a segment of a larger planned

transit investment, only that specific

segment will be evaluated.

Comment. FTA received 24 comments

relating to the criteria for mobility

improvements. Of these, 15 addressed

the issue of mobility for low-income

households. Ten commenters

recommended revising the low-income

mobility measure to include

destinations, such as employment areas,

within 1⁄2-mile of boarding points, in

addition to the existing measure for

households. Two commenters

recommended expanding the lowincome household measure to include

other populations that tend towards

transit-dependence, such as senior

citizens, students, and persons with

disabilities. One recommended

accounting for discretionary riders, and

another suggested eliminating the

measure for low-income mobility,

perceiving that it perpetuated an image

of transit as a carrier of poor people that

persons of middle-class status would

not want to ride. One commenter

suggested that low-income mobility be

separated from the measure for mobility

improvements.

Other comments on this measure

included two recommendations to

incorporate a consideration for

congestion, two requests to incorporate

a measure for delays and ‘‘incidents’’ on

the transit system, various calls for

‘‘better measures,’’ and

recommendations that different

measures be applied to different modes

of transit (i.e., light rail versus

commuter rail).

Response. FTA recognizes that a

system that is located near low-income

households is of little use to residents

unless it can also provide access to

employment centers and other activity

centers. Therefore, a factor for

destinations within a 1⁄2-mile radius of

new stations has been added to the

measure for mobility improvements.

FTA is required by section

5309(e)(3)(D) to ‘‘consider the degree to

which the (proposed) project increases

the mobility of the mass transportation

dependent population, or promotes

economic development.’’ For a variety

of reasons, low-income households were

chosen as a surrogate for measuring the

transit dependent population. Chief

among these is the fact that transit

dependence is often a factor of income.

Many people rely on transit service for

basic mobility—some by necessity, and

some by economic choice; many

residents of upscale central city

neighborhoods simply choose not to

own an automobile. There is value in

considering all of these people in the

measure for basic mobility; however,

were transit service suddenly

eliminated, those riders with an

economic choice would find other

alternatives available to them. Further,

many of those riders who ride transit by

choice do so because it permits them to

bypass congestion on highways and city

streets. These benefits would already be

accounted for in the measure for travel

time savings. The focus on low income

households provides a clearer—though

still imperfect—assessment of how well

the proposed project would serve those

who do not have the ability to choose;

i.e., the mass transit dependent

population specified in the statute.

The comments calling for better

measures to assess the mobility

improvements of a proposed project are

well taken; unfortunately, no

recommendations for new measures or

methodologies accompanied those

comments. FTA is as interested as the

transit industry in advancing the state of

the art of transit planning, and is

conducting research into better ways to

measure the various benefits of transit

service, particularly high-quality rail

systems. Beginning on September 1,

2001, this Rule employs a revised

measure of travel benefits based on a

multimodal measure of perceived travel

times faced by all users of the

transportation system. As new measures

and methods become available, FTA

may amend or modify this rule.

Comment. Ten comments were

received on the criterion for

environmental benefits; no two were

alike. One interest group suggested that

impacts on areas where energy is

generated (i.e., the location of a remote

generating plant) be incorporated into

the evaluation, and that energy

comparisons be made on a passengermile basis. One transit operator

recommended incorporating ‘‘nonscientific ‘quality of life ’’’ factors. Two

interest groups objected to the use of

BTUs, with one suggesting the use of

Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations 76873

vehicle miles traveled (VMT) instead

and the other suggesting that if it is

retained, the measure should be limited

to non-renewable energy sources and

should include energy used in

construction. Two commented that

greater weight should be given to

proposed projects in nonattainment

areas, and one individual commenter

recommended that other benefits should

be included, such as reduced parking

demand which would reduce parking

lot runoff. One local government

recommended that the evaluation

consider wetlands and endangered

species habitats.

Response. It should be noted that this

evaluation does not represent the only

relationship between the new starts

process and environmental

considerations. All proposed new starts

projects must meet NEPA requirements

as a condition of eligibility for funding.

Thus, factors such as runoff, wetlands,

and the habitat of endangered species

are already considered. In addition, EPA

classifications for attainment/

nonattainment are also considered as

part of the evaluation of environmental

benefits for all proposed new starts

projects.

To the extent that ‘‘greater weight’’

can be given to proposed projects in

nonattainment areas, 49 USC

5309(e)(8)(B) provides expedited

procedures for FTA decisionmaking and

prohibits any limitations on the

simultaneous evaluation of proposed

projects in at least two corridors in such

cases. This is reflected in paragraph (c)

under § 611.3 of this rule. It should be

noted that previously, these projects

were also exempt from evaluation under

the new starts criteria; this provision

was among those eliminated by TEA–

21.

Quality of life issues, to the extent

that they can be identified and defined

for individual projects, are more

appropriately addressed in the ‘‘other

factors’’ criteria than as part of the

measures for environmental benefits.

BTUs were chosen as the measure for

reporting energy consumption because

they represent a universal and

universally-accepted measure of energy.

While it may be possible to evaluate

changes in energy consumption in terms

of gallons of gasoline, gallons of diesel

fuel, barrels of crude oil, kilowatt-hours

of electricity, or tons of coal, a universal

measure is needed to compare these

energy sources to each other and to

evaluate the benefits of one project in

comparison to others.

Comment. Three comments were

submitted on the measures for

evaluating operating efficiencies. One

operator of a major northeastern transit

system commented that the change in

operating cost per passenger mile would

give high marks for crowding and

penalize proposed projects that would

mitigate crowding, a topic that was

raised by others in comments relating to

the measure for cost effectiveness. One

interest group recommended no changes

to the measure, but suggested that the

TSM alternative be dropped after entry

into preliminary engineering and

proposed language for incorporation

into the rule. One individual commenter

opined that cost per passenger mile is

easily manipulated, costs vary across

the country, and recommended the

establishment of thresholds for number

of peak and off-peak passengers, with a

pass/fail rating.

Response. Concerns regarding the

‘‘ease’’ with which information for this

measure might be ‘‘manipulated’’ are

noted, but they are ultimately not

relevant to the process. Project sponsors

are required to certify to FTA that the

information submitted under the project

evaluation criteria is developed in

compliance with FTA’s technical

guidance. Any attempt at manipulation

of data would likely be discovered

during the evaluation and approval

process. This measure is but one of the

many criteria under which proposed

new starts are evaluated, and will not by

itself ‘‘make or break’’ a project. The

other comments are addressed

elsewhere in the preamble to this rule.

Comment. FTA received a total of 32

comments on the measure for cost

effectiveness. The NPRM for this rule

solicited comment on the retention of

FTA’s historical ‘‘cost per new rider’’ (or

more properly, incremental cost per

incremental rider) measure to indicate

cost effectiveness, and asked if there

were other measurements. Twenty-three

comments were submitted in response

this request. An additional nine

commenters addressed this issue as part

of their general comments on the NPRM.

All were unanimous in their assertion

that the cost effectiveness measure

should ‘‘roll up’’ additional benefits

beyond incremental cost per

incremental rider. The consensus was

that focusing on new riders alone

ignores benefits to other riders, and thus

biases the measure against older cities

with ‘‘mature’’ transit systems where the

focus of a proposed new start would be

on improving service, not attracting new

riders. Most recommended a measure

based on ‘‘cost per benefiting rider’’ or

simply ‘‘cost per rider.’’ The most

common examples of benefits given in

comments were reductions in crowding

and travel time savings. A trade group

representing the transit industry

recommended the formation of a

committee to study the issues. One

transit operator recommended a ‘‘fullcost accounting approach’’

incorporating the full range of societal

impacts, including local policy

decisions on land use and parking;

another operator recommended a

measure based on transit system

throughput. Others recommended

including cost per new trip, new riders

attracted to the existing system by the

new start, total annualized cost per

rider, travel time savings, and

accounting for the conversion of

multimodal trips to transit trips, and

single-occupant vehicle (SOV) trips to

multimodal trips.

Response. It is important to note that

the measure for cost effectiveness is not

intended to be a single, stand-alone

indicator of the merits of a proposed

new starts project. It is but one part of

the multiple measure method that FTA

uses to evaluate project justification

under the statutory criteria. While cost

effectiveness is an important

consideration, so are mobility

improvements, environmental benefits,

and the other factors described both in

TEA–21 and elsewhere in this rule.

However, FTA is aware that the cost

effectiveness measure is often

interpreted by project sponsors, State

and local decisionmakers, and even

elsewhere within the Executive and

Legislative branches of the Federal

government as ‘‘the’’ measure that will

‘‘make or break’’ a proposed new start.

In light of this, and in response to the

unanimous call by commenters for a

‘‘better’’ measure of cost effectiveness,

FTA has developed a measure of

‘‘transportation system user benefits’’ to

more accurately address the criteria for

cost effectiveness. In simple terms, the

basic goal of any major transportation

investment is to reduce the amount of

travel time and out-of-pocket costs that

people incur for taking a trip; the cost

of mobility. The new Transportation

System User Benefits measure of cost

effectiveness measures the change in

these costs, and accounts for changes to

transit, highway, and other modes of

travel.

This new cost effectiveness measure

replaces the current ‘‘dollars per new

rider’’ figure that can be—and often is—

perceived as ‘‘subsidy per new rider.’’

This approach de-emphasizes new

riders and measures not only the

benefits to people who change modes,

but also accounts for benefits within

modes (i.e., benefits to existing riders

and highway users).

The Transportation System User

Benefits measure is not new to FTA or

to the new starts project evaluation

process. A similar combination of cost

76874 Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations

and travel time savings for new and

existing riders was identified as a

measure for cost effectiveness in the

1984 Statement of Policy on Urban Mass

Transportation Major Capital

Investments.

User benefits are a good measure of

the effectiveness of a major transit

investment; however, the

Transportation System User Benefits

measure should not be interpreted as a

single measure of all of the expected

benefits of a new starts project. Those in

search of a single measure that ‘‘rolls

up’’ the overall benefits expected of a

proposed new start should direct their

attention towards the overall rating for

project justification; the Transportation

System User Benefits measure of cost

effectiveness is but a single component.

This rule has been revised to reflect

this new approach. In addition, FTA

will publish guidance describing how

project sponsors should calculate and

report the new cost effectiveness

measure for evaluation purposes. The

new Transportation System User

Benefits measure of cost effectiveness

will be phased in over time, becoming

effective on September 1, 2001.

Comment. FTA received a total of 19

comments relating to the land use

criterion. In general, the comments

reflected a general concern over how

land use will be measured and used as

a factor for project evaluation.

While there was no clear pattern to

the comments, a number of recurring

themes were apparent. One of these

themes was ‘‘flexibility.’’ A transit

industry trade association and a new

starts interest group supported the

measure in general, but noted that its

application should be flexible enough to

account for regional differences, and

that guidance would be essential; one

recommended that FTA undertake a

study of the ‘‘cost of sprawl’’ and

suggested alternative language for the

final rule. One transit operator

submitted comments in support of the

trade association.

The second theme that arose from the

comments concerned the application of

the land use measure. Five commenters

expressed confusion or concern over a

perceived vagueness of the land use

criterion, terming it ‘‘nebulous,’’

‘‘vague’’ and ‘‘ambiguous.’’ Two

commenters noted that land use issues

would already be captured by other

project justification measures or through

the modeling process, and two others

expressed concerns over a perceived

reporting burden. Two more commented

that land use would vary greatly by

alternative and alignment. One transit

operator in a major northeastern city

and one commenter at the Oakland, CA

workshop expressed concern that the

measure for land use would bias the

new starts process in favor of suburban

projects. One transit operator in a

southwestern city that does not have

zoning ordinances recommended

incorporating a consideration for

voluntary actions by the community to

coordinate station area development,

and objected to the elevation of land use

considerations to the ‘‘status’’ of the

other statutory criteria. An operator in

another southwestern city in the same

State commented that ratings should be

based only on factors over which transit

operators have control, and noted that

similar evaluation criteria should be

applied to FHWA funds. In contrast, a

council of governments from a city in

the Pacific Northwest recommended

that FTA give significant weight to

regions with a history of containing

sprawl.

The final common theme among some

of the commenters was to question the

connection between land use and

transportation planning. One

commenter noted that the criterion

assumes coordination between

transportation and planning, and two

questioned or flatly rejected any

correlation between transportation and

land use.

Response. This rule does not

represent a substantial change from

existing FTA policy or practice. Even

prior to TEA–21, FTA included land use

among the primary evaluation criteria.

As noted earlier in this preamble, while

land use is not one of the project

justification criteria specified in Federal

transit law, it is included among the

factors that FTA is to consider when

applying those criteria. Additionally,

TEA–21 added two new land use

considerations to the evaluation

process; a clear intent by Congress to

give additional attention to this issue.

Contrary to those comments that

questioned the link between

transportation and land use, FTA has

found that transit supportive local land

use policies have been an important

indicator of the future success of

Federally-assisted new starts projects.

In response to the comment that

highway projects should be subject to a

similar evaluation of land use, FTA is

tempted to agree. However, as noted in

response to a similar comment on the

alternatives analysis requirement,

highway projects are funded under a

formula program and are not subject to

the same evaluation process as transit

new starts, which are funded under a

discretionary program, and FTA is not

at liberty to change the law or otherwise

impose such a requirement.

Finally, in terms of flexibility in the

application of the land use criteria, FTA

finds that the existing process, which

will continue under this rule, offers an

acceptable balance between the need for

comparability among proposed projects

and the desire to permit project

sponsors in each region to highlight

their own successes in linking transit

and land use planning. This can and

often does include privately-sponsored

transit-oriented development. A new

starts investment requires a regional

commitment by a variety of State and

local agencies, as well as the community

at large; those who have a stake in the

financing and construction of a new

start also have a stake in its ultimate

success. Thus, it is not unreasonable to

expect the same degree of commitment

to regional planning as to project

funding.

Reflecting that same concept of local

commitment, this Rule also incorporates

an element for pedestrian mobility into

the land use measure. Pedestrian

mobility has been a component of FTA’s

land use evaluation, as described in

guidance issued each year at the

beginning of the data collection process.

This Rule formalizes that approach.

Pedestrian facilities represent the basic,

common link among all modes of

transportation; therefore, a regional

emphasis on pedestrian facilities and

systems as part of land use planning

will enhance the mobility of the

population and the utility of the

planned transit investment. Language

has been added to appendix A of this

Rule to specify that the land use

measure will include consideration of

existing and planned pedestrian

facilities, which are expected to reflect

curb ramp transition plans and

milestones as required under 28 CFR

35.150(d)(2).

F. Section 611.11: Local Financial

Commitment

Section 5309(e)(1)(C) requires that

proposed projects also be supported by

an acceptable degree of local financial

commitment, including evidence of

stable and dependable financing sources

to construct, maintain and operate the

system or extension. This proposed rule

retains the following measures for

evaluation of the local financial

commitment to a proposed project:

1. The proposed share of total project

costs from sources other than the

section 5309 new starts program,

including Federal formula and flexible

funds, the local match required by

Federal law, any additional capital

funding (‘‘overmatch’’), and the degree

to which initial planning activities have

Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations 76875

been carried out without relying on

funds from § 5309.

Comment. Three commenters

expressed confusion over whether ‘‘non5309 funds’’ included only local funds,

or whether other Federal funds would

be counted as part of ‘‘local’’ funding.

Response. Paragraph (a) under the

heading, ‘‘Local Financial

Commitment’’ in Appendix A to this

rule has been revised to specify that the

proposed local share of project costs is

defined as the percentage of capital

costs to be met using funds from sources

other than the new starts program under

49 U.S.C. 5309. Thus, the use of flexible

funds from other Federal sources will

not be considered as part of the ‘‘Federal

share’’ for purposes of evaluation under

this Rule (though for purposes of

funding eligibility the statutory ratio of

at least 20 percent local funding must

still be met using other than Federal

funds).

2. The stability and reliability of the

proposed capital financing plan (rated

‘‘high,’’ ‘‘medium-high,’’ ‘‘medium,’’

‘‘low-medium,’’ or ‘‘low’’).

3. The stability and reliability of the

sponsoring agency to fund the operating

needs of the entire transit system as

planned once the guideway project is

built. Ratings of ‘‘high,’’ ‘‘mediumhigh,’’ ‘‘medium,’’ ‘‘low-medium,’’ or

‘‘low’’ will be used to describe stability

and reliability of operating revenue.

The measures for these criteria are

carried over intact from those used

previously, and are more fully

explained in Appendix A. The only

changes are that ‘‘overmatch’’ was

added as a statutory consideration by

TEA–21, and an acknowledgement was

added that FTA will consider whether

adequate provisions have been made to

fund the capital needs of the entire

transit system as planned, including key

station plans and milestones as required

by the Americans with Disabilities Act.

Comment. Eleven commenters

expressed varying opinions and made

numerous recommendations on the

local financial commitment criteria, but

no clear theme emerged. A transit

industry trade group urged FTA to

consider not only the strength of the

funding plan, but also the degree of

commitment, the level of policy

commitment to the project and funds

already secured, and recommended

addressing the level of commitment to

the overall capital program. One transit

operator from the mid-Atlantic region

expressed support for the trade

association’s position. An industry

interest group requested more detailed,

prescriptive requirements. One State

DOT that is also a Statewide transit

operator wrote in support of their trustfund-supported Statewide intermodal

system, and stated that projects in such

States should not be judged inferior to

those that rely on project-specific ballot

measures.

Response. The existing project

evaluation and rating process, already

accounts for factors such as the strength

of the local commitment, the level of

policy commitment to the proposed

project, the level of commitment to the

overall capital program. This practice

would continue under this rule.

Contrary to the comment implying that

Statewide trust funds would be judged

‘‘inferior’’ to other financing plans, such

dedicated funding sources offer a

distinct advantage in the rating process.

It should be noted, however, that the

mere existence of a dedicated Statewide

funding source is not sufficient to

achieve a high rating; as a project

proceeds through preliminary

engineering and final design, evidence

that sufficient funds have been

committed and programmed to the

project will also be required. The

comment that this Rule is not

prescriptive enough is puzzling; Federal

agencies are more often criticized for

being too prescriptive and inflexible.

This Rule is intended to strike a balance

between the need to apply a consistent

standard, and the need to allow for the

differences inherent in locally-derived

projects.

G. Section 611.13: Overall Project

Ratings

Perhaps the most significant change to

this process brought by TEA–21 is the

requirement that FTA establish

summary recommendations for each

project, in addition to the ratings for

each of the project justification criteria.

Section 5309(e)(6) requires FTA to

‘‘evaluate and rate (each) project as

‘highly recommended,’ ‘recommended,’

or ‘not recommended,’ ’’ based on the

results of the project evaluation process.

It also requires that ratings be assigned

to each of the individual evaluation

criteria.

FTA will combine the ratings for each

of the financial rating factors and project

justification criteria into overall

‘‘finance’’ and ‘‘justification’’ ratings of

‘‘high,’’ ‘‘medium-high,’’ ‘‘medium,’’

‘‘low-medium,’’ or ‘‘low.’’ These ratings

will then be combined into the single,

overall project ratings required by TEA–

21. For a proposed project to be rated as

‘‘recommended,’’ it must be rated at

least ‘‘medium’’ in terms of both finance

and justification. To be ‘‘highly

recommended,’’ a proposed project

must be rated at least ‘‘medium-high’’

for both finance and justification.

Proposed projects not rated at least

‘‘medium’’ in both finance and

justification will be rated as ‘‘not

recommended.’’ These ratings will be

used both to approve entry into

preliminary engineering and final

design, as input to recommend

proposed projects for Federal funding

commitments, and for purposes of the

Annual and Supplemental Reports on

New Starts under section 5309(o)(1) and

(2). A proposed project must receive a

rating of at least ‘‘recommended’’ in

order to be approved for any of these

purposes.

Comment. A total of 14 comments

addressed the overall project ratings.

Virtually all of them expressed

discomfort with the terms, particularly

the term, ‘‘not recommended.’’ The most

common concern was that a meritorious

project would be rated ‘‘not

recommended’’ simply because it had

not been sufficiently developed to be

rated. Nine commenters suggested

renaming the ‘‘not recommended’’

rating or creating a separate rating such

as ‘‘not ready for recommendation,’’

‘‘not rated,’’ ‘‘not ready,’’ ‘‘incomplete,’’

or ‘‘not currently recommended.’’ One

commenter at the Washington, DC

workshop noted that proposed projects

that ‘‘fail’’ should be provided with

information explaining the rationale for

the ratings. There was also substantial

discussion at all three workshops

concerning the permanence of the

ratings, opportunities to change ratings,

and so forth.

Response. The terms used for the

overall project ratings—‘‘highly

recommended,’’ ‘‘recommended’’ and

‘‘not recommended’’ ‘‘ are established in

law by TEA–21, and FTA is not at

liberty to change them. We can,

however, elaborate. While the names

used for the overall ratings will

continue to be given as ‘‘highly

recommended,’’ ‘‘recommended’’ and

‘‘not recommended,’’ in the case of the

‘‘not recommended’’ rating we will

indicate the reason for the rating. In

order to be rated at least

‘‘recommended,’’ a proposed new starts

project must be rated at least ‘‘medium’’

for both project justification and local

financial commitment. In order to be

rated at least ‘‘medium’’ for local

financial commitment, a proposed

project must be rated at least ‘‘medium’’

in terms of the stability and reliability

of operating funds, and the stability and

reliability of capital funding. When a

proposed project is rated ‘‘not

recommended,’’ FTA will indicate

which of these areas requires

improvement: ‘‘J’’ for project

justification, ‘‘O’’ for the operating

funding plan, and ‘‘C’’ for the capital

funding plan. Thus, a proposed new

76876 Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations

start that was found to need

improvement in the capital plan would

be rated ‘‘not recommended (C).’’ This

will provide project sponsors, State,

local, and Federal decisionmakers, and

the public at large with a simple means

to identify the basis for the project

rating. In addition, the Annual and

Supplemental Reports on New Starts, as

well as all project-specific FTA

correspondence, will contain language

that discusses the reasoning behind the

rating and note that all ratings are

subject to change.

Comment. Three commenters

recommended that the ratings be tied to

a proposed project’s stage of

development; i.e., different standards

for preliminary engineering and final

design.

Response. FTA has historically

applied different rating standards for

different stages of project development,

recognizing that it is not possible to

expect the same level of detail or degree

of certainty for proposed projects that

are in preliminary engineering as for

those nearing the end of final design

and contemplating FFGAs. Each edition

of the Annual Report on New Starts

contains tables describing the standards

applied for each of the criteria at each

stage of development. This Rule does

not change FTA’s historical approach.

It is important to note that a rating of

‘‘recommended’’ does not translate

directly into a funding recommendation

in any given fiscal year. Rather, the

overall project ratings are intended to

reflect overall project merit. Proposed

projects that are rated ‘‘recommended’’

or ‘‘highly recommended,’’ and have

been sufficiently developed for

consideration of a Federal funding

commitment (i.e., FFGA), will be

eligible for funding recommendations in

the Administration’s proposed budget

for a given fiscal year.

Comment. A transit industry trade

association expressed concern that

proposed projects in the early stages of

development would be rated ‘‘not

recommended’’ because sufficient

information has not been developed to

address the justification criteria, and/or

local funding is not in place. This, they

advise, would compromise the future of

such projects. They therefore suggested

that the statutory ratings of ‘‘highly

recommended,’’ ‘‘recommended,’’ and

‘‘not recommended’’ be used only in the

context of annual funding

recommendations to Congress.

Response. The distinction between a

rating of ‘‘recommended’’ and a funding

recommendation continues to be the

subject of much confusion. The

comments submitted by the trade

association are most illustrative of this

confusion. They are concerned that

projects that are ‘‘not ready’’ to be rated

will be unfairly given a ‘‘not

recommended’’ rating simply because

they are still early in the development

process. They therefore suggest that the

overall ratings be used only for purposes

of FTA’s annual funding

recommendations to Congress, and not

as an indicator of overall merit. Were

FTA to adopt this suggestion, however,

it would guarantee that all projects for

which FTA did not recommend funding

in the President’s budget request would

receive a summary rating of ‘‘not

recommended,’’ regardless of merit; i.e.,

it would actually cause the effect the

trade association wishes to avoid, and

would increase, not decrease, the degree

of confusion over these ratings. FTA is

convinced that Congress intended for

the overall ratings to be used to denote

project merit, and that FTA’s practice of

applying different rating standards at

different stages of project development

already prevents the difficulties

imagined by the trade association.

Further, FTA would like to remind the

transit industry, Federal, State and local

decisionmakers, and the public at large

that proposed new starts projects are rerated at least annually for the Annual

Report on New Starts, as well as at the

time approval is sought for entry into

preliminary engineering, final design,

and entry into an FFGA. The overall

ratings are not permanent judgements of

project worth.

Comment. One transit operator

objected to the statutorily-required

approval to enter preliminary

engineering and final design, urging that

proposed projects be permitted to

proceed regardless of funding

recommendations. This same operator

also objected to the requirement that

proposed projects be rated at least

‘‘medium’’ for both finance and

justification, claiming that one category

should be sufficient.

Response. This comment also reflects

confusion regarding the annual funding

recommendations versus a rating of

‘‘recommended.’’ Neither FTA’s project

funding recommendations nor annual

appropriations earmarks have any

bearing on FTA’s approval for a

proposed project to enter the next phase

of development. FTA is not persuaded

by the argument that a rating of at least

‘‘medium’’ for either justification or

finance is sufficient, and will continue

to require both. To do otherwise would

be to suggest that enough money can

offset a poorly justified project, or that

the inability of project sponsors to

secure adequate funding would not be a

barrier if the proposed project is ‘‘good

enough.’’ Clearly neither is the case. It

takes a worthy project with a sound

local financial commitment to ensure a

successful new start.

VII. Response to Request for Comments

on Particular Issues

The NPRM specifically solicited

comment on four issues: (1) Should FTA

establish ‘‘threshold’’ or ‘‘pass/fail’’

values for evaluating each of the project

evaluation criteria, and if so, what

values would be appropriate; (2) Are

there other means for measuring cost

effectiveness than the current ‘‘cost per

new rider’’ measure; (3) How should

FTA evaluate the ‘‘technical capability’’

of project sponsors, and what ‘‘other

factors’’ might be appropriate; and (4)

How much relative attention should be

given to each of the criteria in

establishing the overall project ratings.

A total of 31 individuals or

organizations submitted comments on

one or more of these questions.

Question 1: Threshold Values.

Consistent with FTA’s 1996 Statement

of Policy and prior practice, this

proposed rule does not establish

‘‘threshold’’ values for the statutory

project justification criteria. Instead, we

rate each project as ‘‘high,’’ ‘‘mediumhigh,’’ ‘‘medium,’’ ‘‘low-medium,’’ or

‘‘low’’ according to its individual merits

under each of the measures. Should

FTA establish ‘‘threshold’’ or ‘‘pass/fail’’

values for evaluating each of these

criteria? If so, what thresholds are

appropriate for each criterion?

Comment. Of the 16 responses

received on this issue, 12 opposed the

establishment of any type of threshold

or pass/fail values for the criteria. One

interest group and one local government

entity dissented, supporting such

requirements. One transit operator

supported thresholds, but only on the

condition that FTA revise the cost

effectiveness measure to account for

additional benefits such as travel time

savings. One commenter at the Oakland,

CA workshop commented that any

thresholds would have to account for

geographic differences. One operator

noted that if thresholds are deemed

necessary, they should be based on the

mean or lowest value for prior

‘‘recommended’’ projects, or ranges

should be established.

Response. This rule does not establish

threshold values for rating purposes.

Question 2: Cost Effectiveness. FTA

has historically relied on the measure of

‘‘cost per new rider’’ (more precisely,

incremental cost per incremental rider)

to indicate cost effectiveness, an

approach retained in this proposed rule.

Are there other means for measuring the

cost effectiveness of a proposed new

starts project?

Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations 76877

Comment. The 23 comments that

specifically addressed this question

were unanimous in the assertion that

the cost effectiveness measure should

‘‘roll up’’ additional benefits beyond

incremental cost per incremental rider.

The consensus was that focusing on

new riders alone ignores benefits to

other riders, and thus biases the

measure against older cities with

‘‘mature’’ transit systems where the

focus of a proposed new start would be

on improving service, not attracting new

riders. Most recommended a measure

based on ‘‘cost per ‘benefiting’ rider’’ or

simply ‘‘cost per rider.’’ The most

common examples of benefits given in

comments were reductions in crowding

and travel time savings. A trade group

representing the interests of the transit

industry recommended the formation of

a committee to study the issues. One

transit operator recommended a ‘‘fullcost accounting approach’’

incorporating the full range of societal

impacts, including local policy

decisions on land use and parking;

another operator recommended a

measure based on transit system

throughput.

Response. In response to the nearuniversal call for a new measure of cost

effectiveness, FTA has developed a new

Transportation System User Benefits

measure. This measure is described

more fully in the section of the

preamble to this rule that discusses

comments to the cost effectiveness

measure. It should be repeated,

however, that the Transportation

System User Benefits Measure will be

used to evaluate cost effectiveness; the

overall measure for project justification

represents the ‘‘roll-up’’ of anticipated

benefits.

Question 3: Technical Capability/

Other Factors. 49 U.S.C. 5309(e)(3)

establishes a number of ‘‘factors’’ that

FTA must consider when evaluating

proposed projects under the justification

criteria. In particular, 49 U.S.C.

5309(e)(3)(F) directs us to ‘‘consider the

technical capability of the grant

recipient to construct the project,’’ and

49 U.S.C. 5309(e)(3)(H) directs FTA to

consider ‘‘other factors’’ as

‘‘appropriate.’’ How should FTA

evaluate the ‘‘technical capability’’ of

project sponsors? What ‘‘other factors’’

might be appropriate?

Comment. Of the 18 commenters who

responded to this question, 14

recommended that technical capacity be

based on factors related to the project

sponsor’s experience or ‘‘track record’’

with prior new starts, the strength of the

project’s management plan, or some

combination of these factors. One

interest group and one transit operator

noted that most project sponsors lack

the technical expertise to implement a

new start, which is why they hire

contractors; one of these commenters

asserted that any technical capacity

measure would therefore favor existing

systems with their own technical staff.

However, seven commenters

recommended that the experience of

contractors, management teams, and/or

other agency resources be considered.

Two commenters recommended an

evaluation including sponsors’ prior

success in obtaining local funds. One

commenter at the Oakland workshop

expressed confusion regarding the

difference between a measure for

technical capacity and the triennial

review process.

Response. FTA intends to use the

technical capacity factor as an indicator

of the ability of the project sponsor(s) to

successfully implement a proposed new

start, as well as an indicator of project

‘‘readiness.’’ To successfully implement

a new starts project, the project

sponsor(s) must meet the same basic

legal, financial, and eligibility

requirements for all FTA grants; have an

adequate project management plan in

place, and have adequate resources

available to carry out the project

management plan. By ‘‘readiness,’’ we

mean that there are no outstanding

issues that remain to be resolved before

a funding commitment can be

considered. Such outstanding issues

might include unresolved

environmental or mitigation issues,

outstanding engineering or right-of-way

issues, upcoming referenda or board

actions that are crucial to the financing

plan, and issues relating to other basic

requirements including Title IV of the

Civil Rights Act; Environmental Justice;

key station, fleet accessibility,

complimentary paratransit, and other

requirements under the Americans with

Disabilities Act of 1990; and consistency

with National Intelligent Transportation

Systems Architecture.

Comment. Six commenters offered

suggestions regarding ‘‘other factors’’

that should be considered. Two of these

recommended incorporating a factor for

‘‘smart growth’’ or ‘‘livable

communities,’’ with one further

recommending that forecasts used for

such a measure be grounded in MPO

forecasts and that ‘‘extra credit’’ be

given to projects which support national

priorities. One transit industry trade

group recommended that ‘‘other factors’’

be open-ended. Other recommendations

included measures for new ridership,

‘‘willingness to commit funds,’’ and

advancement of multimodal choice.

Response. Many of the suggestions

submitted by commenters to the NPRM,

such as smart growth, livable

communities, and ‘‘willingness to

commit funds,’’ are already captured in

the primary criteria. FTA intends for the

‘‘other factors’’ category to be used as a

means of portraying factors about a

proposed project that the other

evaluation criteria do not adequately

address. Each new start is unique, each

has its own ‘‘story;’’ the ‘‘other factors’’

category will permit project sponsors

and FTA to consider elements of the

proposed project that may otherwise be

ignored in the evaluation process. FTA

has therefore taken a more ‘‘openended’’ approach to the use of ‘‘other

factors’’ in this Rule, and has not

defined specific factors for this category.

Question 4: Relative Attention to

Criteria. FTA also seeks comment on

how much relative attention should be

given to each of the project justification

criteria (mobility improvements,

environmental benefits, operating

efficiencies, cost effectiveness, land use

and other factors) to establish the

overall project ratings.

Comment. Of the 16 comments

received on this issue, nine supported

some kind of weighting of the criteria in

general, but few were specific as to

which should be weighted more or less,

or what those specific weights should

be. Two commenters noted that the

relative importance of the criteria

should vary over time, either over the

course of project development or as

national priorities change. Three

indicated that different weights should

apply according to geographic area or

local conditions; the citizens’ advisory

committee from a transit operator in a

major northeastern city recommended

that cost effectiveness not be considered

at all in that city. Only two comments,

one from a State DOT and one from an

individual member of the public,

recommended specific weights for

specific criteria. Four comments

specifically stated that there should be

no weighting at all, with one major

northeastern transit operator stating that

the ‘‘weights’’ already used by FTA, as

reported in a recent GAO report, be

discontinued.

Response. This rule does not establish

specific weights for specific project

evaluation criteria.

VIII. Other Comments

Additional comments were submitted

to the docket concerning a variety of

issues that are not easily categorized.

These included issues such as concerns

regarding definitions of terms used in

the NPRM, to regional concerns, to the

relationship with the pending FTA/

FHWA joint planning rule, to objections

76878 Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations

regarding the differences between FTA

and FHWA capital programs.

Comment. Four commenters

expressed concerns that the FTA new

starts process complicates the designbuild or ‘‘turnkey’’ approach. Two

additional, related comments

recommended that FTA approve FFGAs

as early as possible in final design, or

perhaps late in preliminary engineering.

Response. Nothing in this rule

prevents project sponsors from

proceeding with a new start under a

design-build approach. No existing

FFGA requirements will be changed or

waived to accommodate the designbuild process. FTA will provide

guidance to project sponsors to clarify

how the design-build process can be

integrated with the new starts project

development process and the FFGA

requirements.

Comment. Two transit operators, one

large and one small, commented that the

approach proposed in the NPRM biases

the process against ‘‘established systems

in mature cities,’’ calling again for more

emphasis on benefits to existing riders

and ‘‘preservation of high market

shares.’’

Response. The Transportation System

User Benefits measure for cost

effectiveness moves away from the

perceived emphasis on new riders and

takes a much broader view of the

benefits of transit. In addition, project

sponsors are reminded that the cost

effectiveness measure was not and is not

intended as a single indicator of project

merit. Established systems in mature

cities may not be able to claim as many

new riders as a brand-new system may

expect, for example, but they have a

distinct advantage under the land use

criteria.

Comment. One large operator objected

to the evaluation of ‘‘segments’’ as

separate projects, recommending that

segments also be considered in relation

to an entire proposed system. Another

operator recommended consideration of

how well a proposed new start would

complement other Federal investments.

Response. In many cases, local project

sponsors propose an extensive regional

fixed guideway transit system that must

be implemented in phases over time, as

Federal, State, and local funding

permits. To ascribe all of the projected

benefits of an entire such system to an

initial segment overstates the benefits of

that segment and prevents equitable

comparison with other proposed new

starts. Taken to its logical conclusion, it

could be argued that measuring the

same systemwide benefits for

subsequent segments would doublecount those benefits. FTA will continue

to evaluate new starts projects as they

have been proposed to us for funding.

This Rule retains the existing

requirement that segments be evaluated

as individual projects.

Comment. One interest group claimed

that alternatives analyses lack

independence and objectivity,

recommending that the process instead

require a vote on options or an

independent poll upon circulation of

the Draft Environmental Impact Study

(DEIS).

Response. Alternatives analysis is

intended to be a means whereby the

local community identifies a

transportation problem and evaluates

alternative solutions, eventually

selecting one that best meets local

needs—the locally-preferred alternative.

It is incumbent upon the community to

ensure that adequate opportunity for

public involvement is provided, and to

take advantage of those opportunities to

be part of the process.

Comment. One small transit operator

recommended that the final rule include

a schedule of deadlines for approval of

proposed projects to advance, and a list

of FTA contacts.

Response. The comment regarding

schedules and deadlines for approval

assumes that all proposed new starts

projects in TEA–21 will be

implemented, will all be found to be

justified and rated as ‘‘recommended’’

or higher, and will all proceed at the

same rate of progress. FTA understands

the desire by one commenter for a list

of FTA contacts to be published as a

part of this rule. However, to do so

would require an amendment to this

rule, including issuance of an NPRM

and a minimum 60-day period for

public comment, for each change in

personnel. Project sponsors are instead

encouraged to contact the appropriate

FTA Regional Office for their area, as

follows:

• Region 1 (ME, VT, NH, MA, RI, CT):

Volpe National Transportation Systems

Center, Kendall Square, 55 Broadway,

Suite 920, Cambridge, MA 02142–1093.

Phone 617–494–2055.

• Region 2 (NY, NJ): One Bowling

Green, Room 429, New York, NY,

10004–1415. Phone 212–668–2170.

• Region 3 (PA, MD, WV, VA, DC):

1760 Market Street, Suite 500,

Philadelphia, PA, 19103–4124. Phone

215–656–7100.

• Region 4 (KY, TN, NC, SC, GA, FL,

AL, MS, PR): Atlanta Federal Center, 61

Forsyth Street, SW, Suite 17T50,

Atlanta, GA, 30303. Phone 404–562–

3500.

• Region 5 (MN, WI, MI, IL, IN, OH):

200 West Adams Street, 24th Floor,

Suite 2410, Chicago, IL, 60606–5232.

Phone 312–353–2789.

• Region 6 (NM, TX, OK, AR, LA):

Fritz Lanham Federal Building, 819

Taylor Street, Room 8A36, Fort Worth,

TX, 76102. Phone 817–978–0550.

• Region 7 (NE, IA, KS, MO): 901

Locust Street, Suite 404, Kansas City,

MO, 64106. Phone 816–329–3920.

• Region 8 (MT, ND, SD, WY, UT,

CO): Columbine Place, 216 16th Street,

Suite 650, Denver, CO, 80202–5120.

Phone 303–844–3242.

• Region 9 (CA, NV, AZ, HI, AS, GU):

201 Mission Street, Suite 2210, San

Francisco, CA, 94105–1831. Phone 415–

744–3133.

• Region 10 (WA, OR, ID, AK):

Jackson Federal Building, 915 Second

Avenue, Suite 3142, Seattle, WA,

98174–1002. Phone 206–220–7954.

Comment. An advisory committee to

a large northeastern transit operator

recommended that the criteria account

for ‘‘Congressional funding anomalies.’’

Response. ‘‘Congressional funding

anomalies,’’ such as annual

appropriations for new starts projects

that do not follow the amounts

committed under the FFGA for a

particular project in a given year, are

only a factor in the case of projects for

which FFGAs have already been issued.

The execution of an FFGA represents

the conclusion of the project rating

process. Therefore, appropriations

shortfalls do not affect the project rating

process. When making annual funding

recommendations for new starts, FTA

attempts to adjust its funding requests to

account for prior year shortfalls, but this

requires no changes to the project rating

criteria, measures, or process. No

change to this rule has been made in

response to this comment.

IX. Regulatory Evaluation

The Federal Transit Administration

(FTA) has evaluated the industry-wide

costs and benefits of the rule, Major

Capital Investment Projects, which is

required by section 3009(e) of TEA–21.

This rule sets forth the process that FTA

will use to evaluate and rate major

capital investments under the statutory

criteria in 49 U.S.C. section 5309(e),

which requires FTA to establish overall

project ratings of ‘‘highly

recommended,’’ ‘‘recommended,’’ or

‘‘not recommended,’’ and to consider

new criteria elements. The changes

required by TEA–21 to FTA’s preexisting statutory criteria are relatively

minor and affect FTA program

management operations more than a

recipient’s operations. The final

regulatory evaluation is available for

public inspection in the docket

established for this rulemaking.

Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations 76879

X. Regulatory Process Matters

A. Executive Order 12688

The FTA has evaluated the industry

costs and benefits of the major capital

investments rule and has determined

that it is a significant rule under E.O.

12688 because of the significant policy

issues involved in federally funding

major capital investments. This rule will

not, however, have an impact on the

economy of $100 million or more.

FTA estimates the costs associated

with this Rule to be minimal. This Rule

implements specific changes required

under TEA–21 in the administration of

the new starts program under 49 U.S.C.

5309.

The following tables show the costs

associated with this Rule. The first table

indicates the costs associated with the

collection, reporting and analysis of

data for the project evaluation and

rating process. These costs are

associated with activities that are

already required as part of the new

starts project development process; they

do not represent new costs associated

with this Rule. Costs are based on

estimates of the number of proposed

new starts projects that are expected to

perform each task listed in the table

below.

New starts data submission, evaluation and ratings Estimated total cost Total project sponsor cost

Task Hours $ Avg. hrs

per Hours $

(A) PE Request ............................................................................................ 7,590 $632,028 450 6,750 $337,500

(B) Annual New Starts Report ..................................................................... 8,480 622,416 150 6,000 300,000

(C)Supplemental Report .............................................................................. ................ ........................ 0 ................ ........................

(D) Final Design Request ............................................................................ 2,424 204,221 150 1,800 90,000

(E) FFGA Approval ...................................................................................... 370 16,004 50 250 12,500

Subtotal ................................................................................................. 18,864 1,474,669 ................ 14,800 740,000

NOTE: Difference between Total Cost and Project Sponsor Cost is FTA Cost.

The second table indicates the costs

associated with the GPRA data

collection requirements contained in

this rule. As these requirements are new

to the new starts process, the associated

costs represent additional costs to FTA

and to new starts project sponsors. The

estimated total costs include costs to

both FTA and to new starts project

sponsors who enter into FFGAs. The

total project sponsor costs are based on

projections that five new FFGAs will be

issued per year, and represents the total

of the costs to all five project sponsors

(i.e., the average cost to each project

sponsor is expected to be $1,670,000 /

5, or $334,000).

GPRA-FFGA data collection Estimated total cost Total project sponsor cost

Task Hours $ Avg. hrs

per Hours $

(A) Data Collection Plan .............................................................................. 480 $42,336 80 400 $40,000

(B) Before Data Collection ........................................................................... 15,200 755,840 3000 15,000 750,000

(C) Documentation of Forecasts .................................................................. 880 42,336 160 800 40,000

(D) After Data Collection .............................................................................. 15,200 755,840 3000 15,000 750,000

(E) Analysis and Reporting .......................................................................... 1,600 101,680 240 1,200 90,000

Subtotal ................................................................................................. ................ 1,698,032 ................ 32,400 1,670,000

NOTE: Difference between Total Cost and Project Sponsor Cost is FTA Cost.

The third table sums the total costs for

both the project evaluation and rating

data collection and analysis process,

and the GPRA data collection and

analysis process.

All data collection and analysis activities Estimated total cost Total project sponsor cost

Task Hours $ Avg. hrs

per Hours $

New Starts Data Submission, Evaluation and Ratings ............................... 18,864 $1,474,669 ................ 14,800 $740,000

GPRA-FFGA Data Collection ...................................................................... ................ 1,698,032 ................ 32,400 1,670,000

Total ...................................................................................................... ................ 3,172,701 ................ 47,200 2,410,000

NOTE:Difference between Total Cost and Project Sponsor Cost is FTA Cost.

B. Departmental Significance

This rule is a ‘‘significant regulation’’

as defined by the Department’s

Regulatory Policies and Procedures.

Because the purpose of this rule is to

establish how the Secretary will rate

various major capital investment

projects, it concerns an important

departmental policy and will likely

generate a great deal of public interest.

C. Regulatory Flexibility Act

In accordance with the Regulatory

Flexibility Act, 5 U.S.C. § 601 et seq.,

the FTA has evaluated the effects of this

rule on small entities. Based on this

evaluation, the FTA hereby certifies that

76880 Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations

this action will not have a significant

economic impact on a substantial

number of small entities because this

rule concerns only major capital

investments in new fixed-guideway

transit systems and extensions, which

are not typically undertaken by small

entities.

D. Paperwork Reduction Act

FTA will publish an estimate of the

paperwork burden required by this Rule

in the Federal Register, providing a

sixty-day period for interested parties to

submit comments on FTA’s proposed

information collection methods. Upon

completion of the sixty-day period, FTA

will submit its summary of the

comments received and any resulting

change in the information collection

methods to OMB. Upon submission to

OMB, FTA will provide an additional

thirty days to provide comments on

FTA’s finalized methods to OMB. Once

OMB has reviewed this data for

compliance with the Paperwork

Reduction Act, OMB will provide FTA

with a control number authorizing FTA

to collect the requested information.

Affected parties will not have to comply

with the information collection

requirements of this Rule until FTA

publishes the OMB control number in

the Federal Register.

E. Executive Order 13132

This action has been analyzed in

accordance with the principles and

criteria contained in Executive Order

13132 and it has been determined that

the proposed rule will not have

federalism implications that impose

substantial direct compliance costs on

state and local governments.

F. National Environmental Policy Act

The agency has determined that this

proposed rule, if adopted, will have

positive effects on the environment by

encouraging the use of mass transit,

which may reduce the use of single

occupancy vehicles.

G. Energy Act Implications

This regulation should have a positive

effect on energy consumption because,

through the Federal investment mass

transit projects, it would increase the

use of mass transit.

H. Unfunded Mandates Reform Act

This rule will not result in the

expenditure by State, local, and tribal

governments, in the aggregate, of

$100,000,000 or more in any one year.

List of Subjects in 49 CFR Part 611

Government contracts; Grant

programs—Transportation; Mass

transportation

A new part 611 is added to read as

follows:

PART 611—MAJOR CAPITAL

INVESTMENT PROJECTS

Sec.

611.1 Purpose and contents.

611.3 Applicability.

611.5 Definitions.

611.7 Relation to planning and project

development processes.

611.9 Project justification criteria for grants

and loans for fixed guideway systems.

611.11 Local financial commitment criteria.

611.13 Overall project ratings.

Appendix A to Part 611—Description of

Measures for Project Evaluation.

Authority: 49 U.S.C. 5309; 49 CFR 1.51

§ 611.1 Purpose and contents.

(a) This part prescribes the process

that applicants must follow to be

considered eligible for capital

investment grants and loans for new

fixed guideway systems or extensions to

existing systems (‘‘new starts’’). Also,

this part prescribes the procedures used

by FTA to evaluate proposed new starts

projects as required by 49 U.S.C.

5309(e), and the scheduling of project

reviews required by 49 U.S.C. 5328(a).

(b) This part defines how the results

of the evaluation described in paragraph

(a) of this section will be used to:

(1) Approve entry into preliminary

engineering and final design, as

required by 49 U.S.C. 309(e)(6);

(2) Rate projects as ‘‘highly

recommended,’’ ‘‘recommended,’’ or

‘‘not recommended,’’ as required by 49

U.S.C. 5309(e)(6);

(3) Assign individual ratings for each

of the project justification criteria

specified in 49 U.S.C. 5309(e)(1)(B) and

(C);

(4) Determine project eligibility for

Federal funding commitments, in the

form of Full Funding Grant Agreements;

(5) Support funding recommendations

for this program for the

Administration’s annual budget request;

and

(6) Fulfill the reporting requirements

under 49 U.S.C. 5309(o)(1), Funding

Levels and Allocations of Funds,

Annual Report, and 5309(o)(2),

Supplemental Report on New Starts.

(c) The information collected and

ratings developed under this part will

form the basis for the annual reports to

Congress, required by 49 U.S.C.

5309(o)(1) and (2).

§ 611.3 Applicability.

(a) This part applies to all proposals

for Federal capital investment funds

under 49 U.S.C. 5309 for new transit

fixed guideway systems and extensions

to existing systems.

(b) Projects described in paragraph (a)

of this section are not subject to

evaluation under this part if the total

amount of funding from 49 U.S.C. 5309

will be less than $25 million, or if such

projects are otherwise exempt from

evaluation by statute.

(1) Exempt projects must still be rated

by FTA for purposes of entering into a

Federal funding commitment as

required by 49 U.S.C. 5309(e)(7).

Sponsors who believe their projects to

be exempt are nonetheless strongly

encouraged to submit data for project

evaluation as described in this part.

(2) Such projects are still subject to

the requirements of 23 CFR part 450 and

23 CFR part 771.

(3) This part does not apply to

projects for which a Full Funding Grant

Agreement (FFGA) has already been

executed.

(c) Consistent with 49 U.S.C.

5309(e)(8)(B), FTA will make project

approval decisions on proposed projects

using expedited procedures as

appropriate, for proposed projects that

are:

(1) Located in a nonattainment area;

(2) Transportation control measures as

defined by the Clean Air Act (42 U.S.C.

7401 et seq.); and

(3) Required to carry out a State

Implementation Plan.

§ 611.5 Definitions.

The definitions established by Titles

12 and 49 of the United States Code, the

Council on Environmental Quality’s

regulation at 40 CFR parts 1500–1508,

and FHWA–FTA regulations at 23 CFR

parts 450 and 771 are applicable. In

addition, the following definitions

apply:

Alternatives analysis is a corridor

level analysis which evaluates all

reasonable mode and alignment

alternatives for addressing a

transportation problem, and results in

the adoption of a locally preferred

alternative by the appropriate State and

local agencies and official boards

through a public process.

Baseline alternative is the alternative

against which the proposed new starts

project is compared to develop project

justification measures. Relative to the no

build alternative, it should include

transit improvements lower in cost than

the new start which result in a better

ratio of measures of transit mobility

compared to cost than the no build

alternative.

BRT means bus rapid transit.

Bus Rapid Transit refers to

coordinated improvements in a transit

Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations 76881

system’s infrastructure, equipment,

operations, and technology that give

preferential treatment to buses on fixed

guideways and urban roadways. The

intention of Bus Rapid Transit is to

reduce bus travel time, improve service

reliability, increase the convenience of

users, and ultimately, increase bus

ridership.

Extension to existing fixed-guideway

system means a project to extend an

existing fixed guideway system.

FFGA means a Full Funding Grant

Agreement.

Final Design is the final phase of

project development, and includes (but

is not limited to) the preparation of final

construction plans (including

construction management plans),

detailed specifications, construction

cost estimates, and bid documents.

Fixed guideway system means a mass

transportation facility which utilizes

and occupies a separate right-of-way, or

rail line, for the exclusive use of mass

transportation and other high

occupancy vehicles, or uses a fixed

catenary system and a right of way

usable by other forms of transportation.

This includes, but is not limited to,

rapid rail, light rail, commuter rail,

automated guideway transit, people

movers, ferry boat service, and fixedguideway facilities for buses (such as

bus rapid transit) and other high

occupancy vehicles. A new fixed

guideway system means a newlyconstructed fixed guideway system in a

corridor or alignment where no such

system exists.

FTA means the Federal Transit

Administration.

Full Funding Grant Agreement means

an instrument that defines the scope of

a project, the Federal financial

contribution, and other terms and

conditions.

Major transit investment means any

project that involves the construction of

a new fixed guideway system or

extension of an existing fixed guideway

system for use by mass transit vehicles.

NEPA process means those

procedures necessary to meet the

requirements of the National

Environmental Policy Act of 1969, as

amended (NEPA), at 23 CFR part 771;

the NEPA process is completed when a

Record of Decision (ROD) or Finding of

No Significant Impact (FONSI) is issued.

New start means a new fixed

guideway system, or an extension to an

existing fixed guideway system.

Preliminary Engineering is the process

by which the scope of the proposed

project is finalized, estimates of project

costs, benefits and impacts are refined,

NEPA requirements are completed,

project management plans and fleet

management plans are further

developed, and local funding

commitments are put in place.

Secretary means the Secretary of

Transportation.

TEA–21 means the Transportation

Equity Act for the 21st Century.

§ 611.7 Relation to Planning and Project

Development Processes

All new start projects proposed for

funding assistance under 49 USC 5309

must emerge from the metropolitan and

Statewide planning process, consistent

with 23 CFR part 450. To be eligible for

FTA capital investment funding, a

proposed project must be based on the

results of alternatives analysis and

preliminary engineering.

(a) Alternatives Analysis. (1) To be

eligible for FTA capital investment

funding for a major fixed guideway

transit project, local project sponsors

must perform an alternatives analysis.

(2) The alternatives analysis develops

information on the benefits, costs, and

impacts of alternative strategies to

address a transportation problem in a

given corridor, leading to the adoption

of a locally preferred alternative.

(3) The alternative strategies

evaluated in an alternatives analysis

must include a no-build alternative, a

baseline alternative, and an appropriate

number of build alternatives. Where

project sponsors believe the no-build

alternative fulfills the requirements for

a baseline alternative, FTA will

determine whether to require a separate

baseline alternative on a case-by-case

basis.

(4) The locally preferred alternative

must be selected from among the

evaluated alternative strategies and

formally adopted and included in the

metropolitan planning organization’s

financially-constrained long-range

regional transportation plan.

(b) Preliminary Engineering.

Consistent with 49 USC 5309(e)(6) and

5328(a)(2), FTA will approve/

disapprove entry of a proposed project

into preliminary engineering within 30

days of receipt of a formal request from

the project sponsor(s).

(1) A proposed project can be

considered for advancement into

preliminary engineering only if:

(i) Alternatives analysis has been

completed

(ii) The proposed project is adopted as

the locally preferred alternative by the

Metropolitan Planning Organization

into its financially constrained

metropolitan transportation plan;

(iii) Project sponsors have

demonstrated adequate technical

capability to carry out preliminary

engineering for the proposed project;

and

(iv) All other applicable Federal and

FTA program requirements have been

met.

(2) FTA’s approval will be based on

the results of its evaluation as described

in §§ 611.9–611.13.

(3) At a minimum, a proposed project

must receive an overall rating of

‘‘recommended’’ to be approved for

entry into preliminary engineering.

(4) This part does not in any way

revoke prior FTA approvals to enter

preliminary engineering made prior to

February 5, 2001.

(5) Projects approved to advance into

preliminary engineering receive blanket

pre-award authority to incur project

costs for preliminary engineering

activities prior to grant approval.

(i) This pre-award authority does not

constitute a commitment by FTA that

future Federal funds will be approved

for this project.

(ii) All Federal requirements must be

met prior to incurring costs in order to

retain eligibility of the costs for future

FTA grant assistance.

(c) Final Design. Consistent with 49

USC 5309(e)(6) and 5328(a)(3), FTA will

approve/disapprove entry of a proposed

project into final design within 120 days

of receipt of a formal request from the

project sponsor(s).

(1) A proposed project can be

considered for advancement into final

design only if:

(i) The NEPA process has been

completed;

(ii) Project sponsors have

demonstrated adequate technical

capability to carry out final design for

the proposed project; and

(iii) All other applicable Federal and

FTA program requirements have been

met.

(2) FTA’s approval will be based on

the results of its evaluation as described

in Parts §§ 611.9–611.13 of this Rule.

(3) At a minimum, a proposed project

must receive an overall rating of

‘‘recommended’’ to be approved for

entry into final design.

(4) Consistent with the Government

Performance and Results Act of 1993,

project sponsors seeking FFGAs shall

submit a complete plan for collection

and analysis of information to identify

the impacts of the new start project and

the accuracy of the forecasts prepared

during development of the project.

(i) The plan shall provide for:

Collection of ‘‘before’’ data on the

current transit system; documentation of

the ‘‘predicted’’ scope, service levels,

capital costs, operating costs, and

ridership of the project; collection of

‘‘after’’ data on the transit system two

years after opening of the new start

project; and analysis of the consistency

76882 Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations

of ‘‘predicted’’ project characteristics

with the ‘‘after’’ data.

(ii) The ‘‘before’’ data collection shall

obtain information on transit service

levels and ridership patterns, including

origins and destinations, access modes,

trip purposes, and rider characteristics.

The ‘‘after’’ data collection shall obtain

analogous information on transit service

levels and ridership patterns, plus

information on the as-built scope and

capital costs of the new start project.

(iii) The analysis of this information

shall describe the impacts of the new

start project on transit services and

transit ridership, evaluate the

consistency of ‘‘predicted’’ and actual

project characteristics and performance,

and identify sources of differences

between ‘‘predicted’’ and actual

outcomes.

(iv) For funding purposes, preparation

of the plan for collection and analysis of

data is an eligible part of the proposed

project.

(5) Project sponsors shall collect data

on the current system, according to the

plan required under § 611.7(c)(4) as

approved by FTA, prior to the beginning

of construction of the proposed new

start. Collection of this data is an

eligible part of the proposed project for

funding purposes.

(6) This part does not in any way

revoke prior FTA approvals to enter

final design that were made prior to

February 5, 2001.

(7) Projects approved to advance into

final design receive blanket pre-award

authority to incur project costs for final

design activities prior to grant approval.

(i) This pre-award authority does not

extend to right of way acquisition or

construction, nor does it constitute a

commitment by FTA that future Federal

funds will be approved for this project.

(ii) All Federal requirements must be

met prior to incurring costs in order to

retain eligibility of the costs for future

FTA grant assistance.

(d) Full funding grant agreements. (1)

FTA will determine whether to execute

an FFGA based on:

(i) The evaluations and ratings

established by this rule;

(ii) The technical capability of project

sponsors to complete the proposed new

starts project; and

(iii) A determination by FTA that no

outstanding issues exist that could

interfere with successful

implementation of the proposed new

starts project.

(2) An FFGA shall not be executed for

a project that is not authorized for final

design and construction by Federal law.

(3) FFGAs will be executed only for

those projects which:

(i) Are rated as ‘‘recommended’’ or

‘‘highly recommended;’’

(ii) Have completed the appropriate

steps in the project development

process;

(iii) Meet all applicable Federal and

FTA program requirements; and

(iv) Are ready to utilize Federal new

starts funds, consistent with available

program authorization.

(4) In any instance in which FTA

decides to provide financial assistance

under section 5309 for construction of a

new start project, FTA will negotiate an

FFGA with the grantee during final

design of that project. Pursuant to the

terms and conditions of the FFGA:

(i) A maximum level of Federal

financial contribution under the section

5309 new starts program will be fixed;

(ii) The grantee will be required to

complete construction of the project, as

defined, to the point of initiation of

revenue operations, and to absorb any

additional costs incurred or

necessitated;

(iii) FTA and the grantee will

establish a schedule for anticipating

Federal contributions during the final

design and construction period; and

(iv) Specific annual contributions

under the FFGA will be subject to the

availability of budget authority and the

ability of the grantee to use the funds

effectively.

(5) The total amount of Federal

obligations under Full Funding Grant

Agreements and potential obligations

under Letters of Intent will not exceed

the amount authorized for new starts

under 49 U.S.C. § 5309.

(6) FTA may also make a ‘‘contingent

commitment,’’ which is subject to future

congressional authorizations and

appropriations, pursuant to 49 U.S.C.

5309(g), 5338(b), and 5338(h).

(7) Consistent with the Government

Performance and Results Act of 1993

(GPRA), the FFGA will require

implementation of the data collection

plan prepared in accordance with

§ 611.7(c)(4):

(i) Prior to the beginning of

construction activities the grantee shall

collect the ‘‘before’’ data on the existing

system, if such data has not already

been collected as part of final design,

and document the predicted

characteristics and performance of the

project.

(ii) Two years after the project opens

for revenue service, the grantee shall

collect the ‘‘after’’ data on the transit

system and the new start project,

determine the impacts of the project,

analyze the consistency of the

‘‘predicted’’ performance of the project

with the ‘‘after’’ data, and report the

findings and supporting data to FTA.

(iii) For funding purposes, collection

of the ‘‘before’’ data, collection of the

‘‘after’’ data, and the development and

reporting of findings are eligible parts of

the proposed project.

(8) This part does not in any way

alter, revoke, or require re-evaluation of

existing FFGAs that were issued prior to

February 5, 2001.

§ 611.9 Project justification criteria for

grants and loans for fixed guideway

systems

In order to approve a grant or loan for

a proposed new starts project under 49

U.S.C. 5309, and to approve entry into

preliminary engineering and final

design as required by section 5309(e)(6),

FTA must find that the proposed project

is justified as described in section

5309(e)(1)(B).

(a) To make the statutory evaluations

and assign ratings for project

justification, FTA will evaluate

information developed locally through

alternatives analyses and refined

through preliminary engineering and

final design.

(1) The method used to make this

determination will be a multiple

measure approach in which the merits

of candidate projects will be evaluated

in terms of each of the criteria specified

by this section.

(2) The measures for these criteria are

specified in Appendix A to this rule.

(3) The measures will be applied to

the project as it has been proposed to

FTA for new starts funding under 49

U.S.C. 5309.

(4) The ratings for each of the criteria

will be expressed in terms of descriptive

indicators, as follows: ‘‘high,’’

‘‘medium-high,’’ ‘‘medium,’’ ‘‘lowmedium,’’ or ‘‘low.’’

(b) The criteria are as follows:

(1) Mobility Improvements.

(2) Environmental Benefits.

(3) Operating Efficiencies.

(4) Transportation System User

Benefits (Cost-Effectiveness).

(5) Existing land use, transit

supportive land use policies, and future

patterns.

(6) Other factors. Additional factors,

including but not limited to:

(i) The degree to which the programs

and policies (e.g., parking policies, etc.)

are in place as assumed in the forecasts,

(ii) Project management capability,

including the technical capability of the

grant recipient to construct the project,

and

(iii) Additional factors relevant to

local and national priorities and

relevant to the success of the project.

(c) In evaluating proposed new starts

projects under these criteria:

(1) As a candidate project proceeds

through preliminary engineering and

Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations 76883

final design, a greater degree of certainty

is expected with respect to the scope of

the project and a greater level of

commitment is expected with respect to

land use.

(2) For the criteria under

§ 611.9(b)(1)–(4), the proposed new start

will be compared to the baseline

alternative.

(d) In evaluating proposed new starts

projects under these criteria, the

following factors shall be considered:

(1) The direct and indirect costs of

relevant alternatives;

(2) Factors such as congestion relief,

improved mobility, air pollution, noise

pollution, energy consumption, and all

associated ancillary and mitigation costs

necessary to carry out each alternative

analyzed, and recognize reductions in

local infrastructure costs achieved

through compact land use development;

(3) Existing land use, mass

transportation supportive land use

policies, and future patterns;

(4) The degree to which the project

increases the mobility of the mass

transportation dependent population or

promotes economic development;

(5) Population density and current

transit ridership in the corridor;

(6) The technical capability of the

grant recipient to construct the project;

(7) Differences in local land,

construction, and operating costs; and

(8) Other factors as appropriate.

(e) FTA may amend the measures for

these criteria, pending the results of

ongoing studies regarding transit benefit

evaluation methods.

(f) The individual ratings for each of

the criteria described in this section will

be combined into a summary rating of

‘‘high,’’ ‘‘medium-high,’’ ‘‘medium,’’

‘‘low-medium,’’ or ‘‘low’’ for project

justification. ‘‘Other factors’’ will be

considered as appropriate.

§ 611.11 Local financial commitment

criteria.

In order to approve a grant or loan

under 49 U.S.C. 5309, FTA must find

that the proposed project is supported

by an acceptable degree of local

financial commitment, as required by

section 5309(e)(1)(C). The local financial

commitment to a proposed project will

be evaluated according to the following

measures:

(a) The proposed share of project

capital costs to be met using funds from

sources other than the section 5309 new

starts program, including both the nonFederal match required by Federal law

and any additional capital funding

(‘‘overmatch’’), and the degree to which

planning and preliminary engineering

activities have been carried out without

funding from the section 5309 new

starts program;

(b) The stability and reliability of the

proposed capital financing plan for the

new starts project; and

(c) The stability and reliability of the

proposed operating financing plan to

fund operation of the entire transit

system as planned over a 20-year

planning horizon.

(d) For each proposed project, ratings

for paragraphs (b) and (c) of this section

will be reported in terms of descriptive

indicators, as follows: ‘‘high,’’

‘‘medium-high,’’ ‘‘medium,’’ ‘‘lowmedium,’’ or ‘‘low.’’ For paragraph (a) of

this section, the percentage of Federal

funding sought from 49 U.S.C. § 5309

will be reported.

(e) The summary ratings for each

measure described in this section will

be combined into a summary rating of

‘‘high,’’ ‘‘medium-high,’’ ‘‘medium,’’

‘‘low-medium,’’ or ‘‘low’’ for local

financial commitment.

§ 611.13 Overall project ratings.

(a) The summary ratings developed

for project justification local financial

commitment (§ § 611.9 and 611.11) will

form the basis for the overall rating for

each project.

(b) FTA will assign overall ratings of

‘‘highly recommended,’’

‘‘recommended,’’ and ‘‘not

recommended,’’ as required by 49

U.S.C. 5309(e)(6), to each proposed

project.

(1) These ratings will indicate the

overall merit of a proposed new starts

project at the time of evaluation.

(2) Ratings for individual projects will

be updated annually for purposes of the

annual report on funding levels and

allocations of funds required by section

5309(o)(1), and as required for FTA

approvals to enter into preliminary

engineering, final design, or FFGAs.

(c) These ratings will be used to:

(1) approve advancement of a

proposed project into preliminary

engineering and final design;

(2) Approve projects for FFGAs;

(3) Support annual funding

recommendations to Congress in the

annual report on funding levels and

allocations of funds required by 49

U.S.C. 5309(o)(1); and

(4) For purposes of the supplemental

report on new starts, as required under

section 5309(o)(2).

(d) FTA will assign overall ratings for

proposed new starts projects based on

the following conditions:

(1) Projects will be rated as

‘‘recommended’’ if they receive a

summary rating of at least ‘‘medium’’ for

both project justification (§ 611.9) and

local financial commitment (§ 611.11);

(2) Projects will be rated as ‘‘highly

recommended’’ if they receive a

summary rating higher than ‘‘medium’’

for both local financial commitment and

project justification.

(3) Projects will be rated as ‘‘not

recommended’’ if they do not receive a

summary rating of at least ‘‘medium’’ for

both project justification and local

financial commitment.

Appendix A to Part 611—Description of

Measures Used for Project Evaluation.

Project Justification

FTA will use several measures to evaluate

candidate new starts projects according to the

criteria established by 49 U.S.C.

5309(e)(1)(B). These measures have been

developed according to the considerations

identified at 49 U.S.C. 5309(e)(3) (‘‘Project

Justification’’), consistent with Executive

Order 12893. From time to time, FTA has

published technical guidance on the

application of these measures, and the

agency expects it will continue to do so.

Moreover, FTA may well choose to amend

these measures, pending the results of

ongoing studies regarding transit benefit

evaluation methods. The first four criteria

listed below assess the benefits of a proposed

new start project by comparing the project to

the baseline alternative. Therefore, the

baseline alternative must be defined so that

comparisons with the new start project

isolate the costs and benefits of the major

transit investment. At a minimum, the

baseline alternative must include in the

project corridor all reasonable cost-effective

transit improvements short of investment in

the new start project. Depending on the

circumstances and through prior agreement

with FTA, the baseline alternative can be

defined appropriately in one of three ways.

First, where the adopted financially

constrained regional transportation plan

includes within the corridor all reasonable

cost-effective transit improvements short of

the new start project, a no-build alternative

that includes those improvements may serve

as the baseline. Second, where additional

cost-effective transit improvements can be

made beyond those provided by the adopted

plan, the baseline will add those costeffective transit improvements. Third, where

the proposed new start project is part of a

multimodal alternative that includes major

highway components, the baseline

alternative will be the preferred multimodal

alternative without the new start project and

associated transit services. Prior to submittal

of a request to enter preliminary engineering

for the new start project, grantees must obtain

FTA approval of the definition of the

baseline alternative. Consistent with the

requirement that differences between the

new start project and the baseline alternative

measure only the benefits and costs of the

project itself, planning factors external to the

new start project and its supporting bus

service must be the same for both the

baseline and new start project alternatives.

Consequently, the highway and transit

networks defined for the analysis must be the

same outside the corridor for which the new

start project is proposed. Further, policies

affecting travel demand and travel costs, such

as land use, transit fares and parking costs,

76884 Federal Register / Vol. 65, No. 236 / Thursday, December 7, 2000 / Rules and Regulations

must be applied consistently to both the

baseline alternative and the new start project

alternative. The fifth criterion, ‘‘existing land

use, transit supportive land use policies, and

future patterns,’’ reflects the importance of

transit-supportive local land use and related

conditions and policies as an indicator of

ultimate project success.

(a) Mobility Improvements.

(1) The aggregate travel time savings in the

forecast year anticipated from the new start

project compared to the baseline alternative.

This measure sums the travel time savings

accruing to travelers projected to use transit

in the baseline alternative, travelers projected

to shift to transit because of the new start

project, and non-transit users in the new start

project who would benefit from reduced

traffic congestion.

(i) After September 1, 2001, FTA will

employ a revised measure of travel benefits

accruing to travelers.

(ii) The revised measure will be based on

a multi-modal measure of perceived travel

times faced by all users of the transportation

system.

(2) The absolute number of existing low

income households located within 1⁄2-mile of

boarding points associated with the proposed

system increment.

(3) The absolute number of existing jobs

within 1⁄2-mile of boarding points associated

with the proposed system increment.

(b) Environmental Benefits.

(1) The forecast change in criteria pollutant

emissions and in greenhouse gas emissions,

ascribable to the proposed new investment,

calculated in terms of annual tons for each

criteria pollutant or gas (forecast year),

compared to the baseline alternative;

(2) The forecast net change per year

(forecast year) in the regional consumption of

energy, ascribable to the proposed new

investment, expressed in British Thermal

Units (BTU), compared to the baseline

alternative; and

(3) Current Environmental Protection

Agency designations for the region’s

compliance with National Ambient Air

Quality Standards.

(c) Operating Efficiencies. The forecast

change in operating cost per passenger-mile

(forecast year), for the entire transit system.

The new start will be compared to the

baseline alternative.

(d) Transportation System User Benefits

(Cost-Effectiveness).

(1) The cost effectiveness of a proposed

project shall be evaluated according to a

measure of transportation system user

benefits, based on a multimodal measure of

perceived travel times faced by all users of

the transportation system, for the forecast

year, divided by the incremental cost of the

proposed project. Incremental costs and

benefits will be calculated as the differences

between the proposed new start and the

baseline alternative.

(2) Until the effective date of the

transportation system user benefits measure

of cost effectiveness, cost effectiveness will

be computed as the incremental costs of the

proposed project divided by its incremental

transit ridership, as compared to the baseline

alternative.

(i) Costs include the forecast annualized

capital and annual operating costs of the

entire transit system.

(ii) Ridership includes forecast total annual

ridership on the entire transit system,

excluding transfers.

(e) Existing land use, transit supportive

land use policies, and future patterns.

Existing land use, transit-supportive land use

policies, and future patterns shall be rated by

evaluating existing conditions in the corridor

and the degree to which local land use

policies are likely to foster transit supportive

land use, measured in terms of the kinds of

policies in place, and the commitment to

these policies. The following factors will

form the basis for this evaluation:

(1) Existing land use;

(2) Impact of proposed new starts project

on land use;

(3) Growth-management policies;

(4) Transit-supportive corridor policies;

(5) Supportive zoning regulations near

transit stations;

(6) Tools to implement land use policies;

(7) The performance of land use policies;

and

(8) Existing and planned pedestrian

facilities, including access for persons with

disabilities.

(f) Other factors. Other factors that will be

considered when evaluating projects for

funding commitments include, but are not

limited to:

(1) Multimodal emphasis of the locally

preferred investment strategy, including the

proposed new start as one element;

(2) Environmental justice considerations

and equity issues,

(3) Opportunities for increased access to

employment for low income persons, and

Welfare-to-Work initiatives;

(4) Livable Communities initiatives and

local economic activities;

(5) Consideration of alternative land use

development scenarios in local evaluation

and decision making for the locally preferred

transit investment decision;

(6) Consideration of innovative financing,

procurement, and construction techniques,

including design-build turnkey applications;

and

(7) Additional factors relevant to local and

national priorities and to the success of the

project, such as Empowerment Zones,

Brownfields, and FTA’s Bus Rapid Transit

Demonstration Program.

Local Financial Commitment

FTA will use the following measures to

evaluate the local financial commitment to a

proposed project:

(a) The proposed share of project capital

costs to be met using funds from sources

other than the 49 U.S.C. 5309 new starts

program, including both the local match

required by Federal law and any additional

capital funding (‘‘overmatch’’). Consideration

will be given to:

(i) The use of innovative financing

techniques, as described in the May 9, 1995,

Federal Register notice on FTA’s Innovative

Financing Initiative (60 FR 24682);

(ii) The use of ‘‘flexible funds’’ as provided

under the CMAQ and STP programs;

(iii) The degree to which alternatives

analysis and preliminary engineering

activities were carried out without funding

from the § 5309 new starts program; and

(iv) The actual percentage of the cost of

recently-completed or simultaneously

undertaken fixed guideway systems and

extensions that are related to the proposed

project under review, from sources other than

the section 5309 new starts program (FTA’s

intent is to recognize that a region’s local

financial commitment to fixed guideway

systems and extensions may not be limited

to a single project).

(b) The stability and reliability of the

proposed capital financing plan, according

to:

(i) The stability, reliability, and level of

commitment of each proposed source of local

match, including inter-governmental grants,

tax sources, and debt obligations, with an

emphasis on availability within the project

development timetable;

(ii) Whether adequate provisions have been

made to cover unanticipated cost overruns

and funding shortfalls; and

(iii) Whether adequate provisions have

been made to fund the capital needs of the

entire transit system as planned, including

key station plans as required under 49 CFR

37.47 and 37.51, over a 20-year planning

horizon period.

(c) The stability and reliability of the

proposed operating financing plan to fund

operation of the entire transit system as

planned over a 20-year planning horizon.

Issued: November 29, 2000.

Nuria I. Fernandez,

Acting Administrator.

[FR Doc. 00–30921 Filed 12–6–00; 8:45 am]

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