79336 Federal Register / Vol. 89, No. 188 / Friday, September 27, 2024 / Notices 

9070.1G. Included in the new chapter 

are the following topics: program 

administrative requirements and other 

provisions, equipment management, 

vehicle use, leasing and title to vehicles, 

satisfactory continuing control 

requirements, reporting requirements, 

management plan, and drug and alcohol 

testing requirements. FTA has updated 

the section on equipment management 

to reflect a change in 49 U.S.C. 5334(h). 

As stated above, FTA has moved 

information related to capital reserve 

accounts to Chapter IV. Information 

related to Federal Funding 

Accountability and Transparency Act 

(FFATA) (Pub. L. 109–282) 

requirements is located in the program 

of projects information in Chapter V. 

Other sections in Chapter VI of C 

9070.1G have been removed and can be 

found in the updated C 5010.1F. Those 

sections include procurement, 

debarment and suspension, financial 

management, FTA’s electronic grant 

management system, system for award 

management (SAM) requirements, 

Electronic Clearing House Operation 

(ECHO) requirements, allowable costs, 

closeout, audit, real property, and 

construction management and oversight. 

G. Chapter VII—State and Program 

Management Plans 

Chapter VII of the updated circular is 

substantially similar to Chapter VII of C 

9070.1G, with minor clarifying edits. As 

stated above, FTA has removed Chapter 

VIII, Other Provisions from the updated 

circular and pertinent information can 

now be found in the updated C 5010.1F. 

Drug and alcohol requirements, 

formerly in Chapter VIII, have been 

moved to Chapter VI of this circular. 

H. Appendices 

FTA has removed many of the 

appendices found in C 9070.1G, as the 

information is available in other 

circulars and resources and can be 

easily referenced. However, FTA has 

retained Appendix B, Sample Section 

5310 Program of Projects, which is 

renamed as Appendix A. FTA has also 

retained Appendix D, Relationship 

Between Coordinated Planning and 

Metropolitan and Statewide Planning 

(Table), but is renamed as Appendix B. 

Veronica Vanterpool, 

Deputy Administrator. 

[FR Doc. 2024–22162 Filed 9–26–24; 8:45 am] 

BILLING CODE 4910–57–P 

DEPARTMENT OF TRANSPORTATION 

Federal Transit Administration 

[Docket No. FTA–FTA–2024–0003] 

Award Management Requirements, 

Final Circular 

AGENCY: Federal Transit Administration 

(FTA), Department of Transportation 

(DOT). 

ACTION: Notice of availability of final 

circular and response to comments. 

SUMMARY: The Federal Transit 

Administration (FTA) has made 

available on its website the final 

updated Award Management 

Requirements Circular (C 5010.1). The 

updated circular combines requirements 

applicable to all FTA financial 

assistance awards (referred to as ‘‘crosscutting’’ requirements) and supersedes 

the previous Award Management 

Requirements Circular C 5010.1E. This 

notice responds to the comments FTA 

received on the proposed circular, 

which was published in the Federal 

Register on February 14, 2024. 

DATES: The applicable date of this 

circular is November 1, 2024. 

ADDRESSES: One may view the 

comments at docket number FTA–2024– 

0003. For access to the docket, please 

visit https://www.regulations.gov or the 

Docket Operations office located in the 

West Building of the United States 

Department of Transportation, Room 

W12–140, 1200 New Jersey Avenue SE, 

Washington, DC 20590, between 9 a.m. 

and 5 p.m. Monday through Friday. 

FOR FURTHER INFORMATION CONTACT: For 

award management questions, Latrina 

Trotman, Office of Program 

Management, Federal Transit 

Administration, 1200 New Jersey Ave. 

SE, Room E46–301, Washington, DC 

20590, phone: (202) 366–2328, or email, 

Latrina.Trotman@dot.gov. For legal 

questions, Jerry Stenquist, Office of 

Chief Counsel, same address, Room 

E56–314, phone: (202) 493–8020, or 

email, Jerry.Stenquist@dot.gov. 

SUPPLEMENTARY INFORMATION: 

Table of Contents 

I. Overview 

II. Responses to Public Comments 

A. Comments for Which No Changes Were 

Made 

B. Changes Based on Public Comments 

C. Comment Requesting Technical 

Assistance 

III. Other Updates 

I. Overview 

This notice announces the availability 

of FTA Circular C 5010.1F, Award 

Management Requirements. C 5010.1F 

replaces C 5010.1E, with an applicable 

date of November 1, 2024. This circular 

incorporates provisions of Federal law 

enacted since the publication of C 

5010.1E, including the Infrastructure 

Investment and Jobs Act (Pub. L. 117– 

58); the Office of Management and 

Budget’s (OMB) and United States 

Department of Transportation’s 

(USDOT) updated Uniform 

Administrative Requirements, Cost 

Principles, and Audit Requirements for 

Federal Awards at 2 CFR part 200 (89 

FR 30046, effective October 1, 2024) and 

2 CFR part 1201, respectively; USDOT’s 

regulation implementing the Uniform 

Relocation Assistance and Real Property 

Acquisition Policies Act of 1970 

(Uniform Act) (49 CFR part 24); and 

USDOT’s Disadvantaged Business 

Enterprise (DBE) regulation (49 CFR part 

26). 

The purpose of Circular 5010.1 is to 

summarize generally applicable FTA 

administrative requirements for 

financial assistance awards (colloquially 

referred to as ‘‘cross-cutting 

requirements’’) while consolidating 

other pre-existing cross-cutting 

guidance historically included in other 

FTA program circulars, including the 

pre-existing ‘‘Formula Grants for Rural 

Areas’’ (C 9040.1G), ‘‘Enhanced 

Mobility of Seniors and Individuals 

with Disabilities’’ (C 9070.1G), ‘‘Bus and 

Bus Facilities Formula Program’’ (C 

5100.1), ‘‘State of Good Repair Grants 

Program’’ (C 5300.1), and ‘‘Urbanized 

Area Formula Program’’ (C 9030.1E) 

circulars, reducing duplicative, 

redundant, and conflicting information 

in separate circulars. The last three of 

these circulars have been consolidated 

and superseded by a new circular, 

‘‘Urbanized Areas Formula Grant 

Programs Guidance’’ (C 9050.1A), which 

is being published contemporaneously 

with this updated C 5010.1F. The first 

two are also being updated and 

superseded with circulars published 

contemporaneously. 

Additionally, the revisions update or 

clarify descriptions of policy to explain 

current FTA practices. The circular 

updates include FTA policies regarding 

real property status reporting, the 

incidental use of FTA-funded project 

property, and transfer of real property to 

third parties for affordable housing. The 

circular updates also increase the use of 

graphics, tables, and weblinks to 

improve clarity. A copy of the circular 

is in the docket and is posted on FTA’s 

Circulars page (https://www.transit.

dot.gov/regulations-and-guidance/ftacirculars/circulars). 


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II. Responses to Public Comments 

FTA published notice for the 

proposed C 5010.1F in the Federal 

Register on February 14, 2024 (89 FR 

11334), seeking public comment. FTA 

received seventy-four comments from 

twelve unique commenters. FTA 

reviewed the comments and discusses 

below the changes that FTA made in the 

final circular based on public 

comments. FTA also addresses 

comments for which no changes were 

made in the final circular. FTA 

appreciates the commenters who 

expressed support for updates in the 

circular, as well as those who provided 

feedback on administrative nonsubstantive changes, such as 

recommending corrections for 

typographical errors and document 

formatting. FTA has reviewed and made 

these changes to the final circular, as 

necessary. In cases where a commenter 

found FTA’s guidance confusing or 

requested clarification and FTA 

declined to amend the circular, the 

commenter should contact the FTA 

regional office responsible for 

administering its awards for assistance. 

A. Comments for Which No Changes 

Were Made 

Comments Outside the Scope of FTA C 

5010.1F 

FTA declined to make changes in 

response to some comments because the 

comments’ subject matter was outside 

the scope of this circular. Topics that 

were outside the scope of the circular 

include: State DOT policies for 

subrecipients’ completion of National 

Environmental Policy Act (NEPA) 

requirements for non-federally funded 

projects and notes on circular changes 

apparently intended for the 

commenter’s internal communication. 

Cloud-Based Computing Technology 

Comment: One commenter requested 

FTA clarify whether cloud-based 

computing technology is a capital or 

operating expense. 

FTA Response: FTA declines to make 

a change based on this comment. C 

5010.1F sufficiently establishes that 

cloud-based computing technology is 

included under the definition of 

‘‘Information Technology Systems,’’ 

which, by extension, is included under 

the definition of ‘‘Equipment.’’ If cloudbased computing technology qualifies as 

‘‘Equipment,’’ it may be considered a 

capital expense as opposed to an 

operating expense. 

Major Capital Project Construction 

Oversight 

Comment: One commenter suggested 

FTA institute a time limit for FTA’s 

review of technical plans and 

specifications for a major capital project 

so as not to delay a project from 

construction. The commenter also 

expressed concerns that the proposed C 

5010.1F does not specify the milestones 

during the design of a project at which 

FTA may request to review the technical 

plans and specifications. 

FTA Response: FTA declines to make 

a change in response to the comment. 

FTA declines to establish generally 

applicable design milestones and 

corresponding time limits because the 

stages of design at which technical 

plans and specifications should be 

reviewed, and the duration of time it 

takes to review them, are better 

determined on a case-by-case basis. FTA 

reviews the design of major capital 

projects at various stages during a 

project’s lifecycle, which is established 

in consultation with project sponsors. 

This project-specific approach retains 

flexibility and efficiency in FTA’s 

review, benefiting both FTA and 

recipients. 

FTA Technical and Construction 

Oversight Review 

Comment: One commenter asked how 

quickly FTA’s reviews of technical 

plans and specifications of a project will 

occur if FTA deems such a review 

necessary. The commenter expressed 

concern that designs that may need to 

be reviewed could be time sensitive. 

The commenter also mentioned that 

there is no guidance on what ‘‘projects’’ 

the oversight review requirement may 

concern and asked whether there are 

there specific cost thresholds for 

projects that would trigger a review. 

FTA Response: FTA declines to make 

a change in response to this comment. 

If deemed necessary, FTA may review 

technical plans and specifications of a 

project to ensure proper execution, 

consistency with the scope of work and 

need, and incorporation of FTA 

requirements. The duration of such a 

review necessarily depends on multiple 

factors that are distinct to the project in 

question and cannot be prescribed. For 

the referenced provision, there is no set 

cost threshold for projects that could 

trigger such a review. However, all 

projects that meet the definition of a 

‘‘Major Capital Project’’ are subject to 

design reviews at different stages during 

a project’s lifecycle. 

Incidental and Shared Use 

Comment: One commenter thanked 

FTA for the updated definition of 

‘‘Equipment.’’ The comment also 

requested FTA reference the definition 

of ‘‘Equipment’’ in other parts of the 

circular related to the concept of 

incidental use. 

FTA Response: FTA declines to make 

a change in response to the comment. 

The definitions section controls the use 

of the term ‘‘Equipment’’ throughout the 

circular. No additional identification of 

the term is required. 

Comment: One commenter asked that 

FTA clarify that incidental use and 

shared use can apply to property other 

than just real property. 

FTA Response: FTA declines to make 

a change in response to this comment. 

The circular is sufficiently clear that the 

incidental use provisions apply to 

equipment. The definition of 

‘‘Incidental Use’’ is ‘‘the limited nontransit use of project property that does 

not conflict with the original authorized 

purpose of the project property or the 

recipient’s ability to maintain 

satisfactory continuing control.’’ The 

circular defines ‘‘Project Property’’ to 

include both real property and personal 

property. 

Comment: FTA’s definitions of 

‘‘Incidental Use’’ and ‘‘Shared Use’’ 

authorize certain non-transit uses of 

transit property. One commenter asked 

FTA to modify these definitions so that 

uses that support or relate to public 

transportation in some way would not 

be categorized as non-transit uses. 

FTA Response: FTA declines to make 

a change in response to this comment. 

FTA’s definitions of ‘‘Incidental Use’’ 

and ‘‘Shared Use’’ sufficiently identify 

FTA’s intended treatment of property 

uses that support public transportation, 

which provides recipients with 

flexibility to use project property for 

both transit and non-transit purposes. 

The commenter’s proposed 

recategorization of property uses would 

not create additional flexibilities and 

conflict with the definition of ‘‘Public 

Transportation’’ at 49 U.S.C. 5302. 

Comment: A commenter asked FTA to 

provide further guidance for 

establishing the allocation of applicable 

costs of a shared use of project property. 

FTA Response: FTA declines to make 

a change in response to this comment. 

The circular says the costs of shared 

uses are tied to the pro rata share of the 

construction, acquisition, maintenance, 

and operating costs that the shared use 

represents. The method of determining 

pro rata costs will vary depending on 

the particular shared use. FTA declines 

to be more prescriptive as to 

determining pro rata share because the 

circular’s purpose is to provide general 

guidance and allow for flexibility. 


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Comment: One commenter expressed 

concern that FTA’s incidental use 

policy in Chapter IV restricts leases of 

FTA-assisted real property to a one-year 

term. 

FTA Response: FTA declines to make 

a change based on this comment. The 

policy in the circular does not limit 

leases for the incidental use of FTAassisted real property to one year. 

Rather, the revision modifies FTA 

policy by changing FTA’s review of 

incidental uses from a concurrence 

process to a notice process. Except in 

cases of utility, ingress, and egress use, 

FTA now requires 30-day prior notice 

for incidental uses that will: (1) 

encumber title to the project property, 

(2) exceed a term of one year, or (3) 

allow for the installation of real 

property fixtures onto project property 

by third parties. 

If none of these apply to an incidental 

use, a 30-day notice is not required. 

Nevertheless, recipients must keep a 

record of all incidental uses, which may 

be reviewed during a compliance review 

or audit. 

Real Property 

Comment: One commenter requested 

that FTA add property use restrictions 

to the list of items included in an 

appraisal report that may affect the 

appraised value. 

FTA Response: FTA declines to make 

a change in response to this comment. 

49 CFR 24.103 establishes the 

requirements for appraisals, which are 

intended to be consistent with the 

Uniform Standards of Professional 

Appraisal Practice (USPAP) and already 

require the appraiser to consider factors 

like land use restrictions and 

encumbrances when determining 

market value. 

Comment: Three commenters 

expressed support for the circular’s 

exemption from FTA’s concurrence on 

real property appraisals for major 

capital projects when FTA has 

determined that a recipient’s Real 

Property Acquisition and Management 

Plan (RAMP) establishes that the 

recipient is adequately prepared to 

comply with Federal requirements 

when acquiring project property. One of 

the three commenters requested that 

FTA provide additional information to 

guide recipients’ drafting of a RAMP 

and the changes to the existing circular. 

FTA Response: FTA declines to make 

a change based on these comments. A 

RAMP is required of all FTA-designated 

major capital projects. FTA provides 

technical assistance and feedback to 

project sponsors through its project 

management oversight contractor 

(PMOC) program on the development of 

a project-specific RAMP document. 

Appendix D of the circular includes a 

model outline for the development of a 

RAMP document. FTA is also exploring 

other ways to provide training and 

technical assistance to major capital 

project sponsors on the RAMP 

development process. 

Comment: One commenter opined 

that, by deleting the definitions of 

‘‘Global Settlement’’ and ‘‘Legal 

Settlement,’’ FTA may have caused a 

conflict with the circular’s provisions 

for property acquisition and relocation 

assistance. 

Response: FTA declines to make a 

change based on this comment. While 

the definitions for ‘‘Global Settlement’’ 

and ‘‘Legal Settlement’’ were removed 

from the Definitions section of the 

proposed circular, the circular’s use of 

the terms are unambiguous. The circular 

refers to legal settlements arrived at after 

filing for property condemnation as 

‘‘administrative settlements’’ for 

purposes of the Uniform Relocation 

Assistance and Real Property 

Acquisition Policies Act (Uniform Act), 

because that is the term used in 

USDOT’s implementing regulation. 49 

CFR 24.102(i). The circular states that a 

‘‘global settlement’’ means the 

consolidation of all payments, including 

acquisition and relocation assistance, 

into one payment. Global settlements 

conflict with the purpose of the Uniform 

Act because relocation assistance 

benefits are a reimbursement of eligible 

actual, reasonable, and necessary 

expenses, while the payment to acquire 

real property relates to the payment of 

just compensation and is subject to 

negotiation. Uniform Act relocation 

assistance benefits must not be used as 

consideration for a settlement of a 

dispute regarding property value. 

Therefore, the circular’s uses of ‘‘Legal 

Settlement,’’ ‘‘Administrative 

Settlement,’’ and ‘‘Global Settlement’’ 

do not conflict with each other or the 

purposes of the Uniform Act. The words 

are used according to their ordinary 

meanings, and it is not necessary to give 

them special definitions in the circular. 

Comment: One comment opined that 

FTA’s allowance of acquisition 

incentives payments (AIPs) to exceed a 

recipient’s just compensation 

determination may conflict with 

language prohibiting global settlements. 

The commenter expressed concern with 

the risk of the global settlement 

prohibition conflicting with state law 

and that a comparison of local 

government acquisition requirements 

should take place prior to full 

implementation. 

FTA Response: FTA declines to make 

a change based on this comment. AIPs 

are payments for interests in real 

property above a recipient’s established 

just compensation determination 

applied equally project-wide, based on 

pre-established criteria, if initial offers 

are timely accepted. FTA has 

determined that the proper use of AIPs 

does not conflict with the Uniform Act 

or the circular’s restriction on global 

settlements because their use is limited 

to compensating owners for the value of 

property, and they serve to ‘‘encourage 

and expedite acquisition by 

agreements.’’ 49 CFR 24.1(a). To avoid 

any conflict, FTA will concur on AIP 

programs prior to their implementation, 

including a review of the proposing 

agency’s documentation that the AIP 

program is permissible under state law. 

AIPs may not be used for relocation 

assistance benefits because a predetermined incentive for displaced 

persons to relocate may potentially 

incentivize premature displacement of a 

person or otherwise incentivize actions 

inconsistent with the purpose of the 

Uniform Act. Recipients still may not 

use global settlements, regardless of 

whether an AIP payment is offered or 

paid. 

Comment: One commenter 

recommended that FTA restore a 

paragraph that had appeared in C 

5010.1E allowing for alternative real 

property valuation methods in 

exceptional circumstances. 

FTA Response: FTA declines to make 

a change based on this comment. C 

5010.1F retains the same provision in 

Chapter IV under a subsection titled 

‘‘Valuation of Property Pending 

Disposal.’’ 

Comment: One commenter asked that 

FTA remove leases exceeding a one-year 

term and third-party fixture installation 

from the requirement for recipients to 

provide 30-day advance notice of an 

incidental use. The commenter asserted 

that these conditions should only be for 

incidental uses that do not require FTA 

concurrence and should be removed 

because all incidental use agreements 

must be terminable and most, if not all, 

require FTA concurrence. 

FTA Response: FTA declines to make 

a change based on this comment 

because the updated language regarding 

incidental uses of real property no 

longer requires concurrence as the 

commenter describes. Rather, the 

revision modifies FTA policy by 

changing FTA’s review of incidental 

uses from a concurrence process to a 

notice process. Except in cases of utility, 

ingress, and egress use, FTA now 

requires 30-day prior notice for 

incidental uses that will: (1) encumber 

title to the project property, (2) exceed 

a term of one year, or (3) allow for the 


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installation of real property fixtures 

onto project property by third parties. If 

none of these apply to an incidental use, 

a 30-day notice is not required. FTA’s 

concurrence is not required for any 

incidental use unless another provision 

of law or the circular applies. 

Nevertheless, recipients must keep a 

record of all incidental uses, which FTA 

may review during a compliance review 

or audit. Lastly, FTA advises that 

recipients should include termination 

provisions in their incidental use 

agreements, but FTA does not prescribe 

any particular terms or notice periods. 

Recipients should use commercially 

reasonable terms that ensure satisfactory 

continuing control over the transit use 

of the property. 

Project Signage 

Comments: FTA received two 

comments on project signage. One 

commenter supported FTA’s 

encouragement of recipients to 

prominently display project signage to 

identify projects approved and funded 

by USDOT but recommended that FTA 

clarify that the suggestion applies to 

signs pertaining to permanent projects, 

as opposed to signage for wayfinding or 

planned service disruptions. Another 

commenter recommended that FTA 

only apply the recommendation to 

projects with a cost of greater than 

$200,000. 

FTA Response: FTA declines to make 

a change based on this comment. FTA 

encourages, but does not require, project 

signage that identifies projects approved 

and funded by USDOT. FTA encourages 

recipients to use their discretion in 

determining which projects are most 

appropriate for such signage, as well as 

the sizes and formats of signs. C 5010.1F 

permits this flexibility through the 

provided guidelines. The inclusion of a 

specific cost or project type threshold 

would limit this flexibility. 

Activity Line Item (ALI) Tree 

Comment: One commenter requested 

that FTA update and streamline its 

Activity Line Item (ALI) tree, which is 

an inventory of scope codes and 

associated ALIs for which funds may be 

obligated in FTA’s award management 

system (TrAMS), as part of the updated 

C 5010.1F. 

FTA Response: FTA declines to make 

a change based on this comment. FTA 

seeks to use C 5010.1F for cross-cutting 

guidance on award management, not to 

provide administrative direction on the 

use of TrAMS. However, FTA currently 

is working on an update to the ALI tree. 

Disadvantaged Business Enterprise 

(DBE) Program 

Comment: In response to language in 

Chapter II stating that FTA-funded 

contracts subject to FTA’s procurement 

rules are also subject to USDOT’s DBE 

regulation, one commenter requested 

that FTA clarify that micro-purchases 

(those transactions not in excess of 

$10,000) are not ‘‘contracts’’ for DBE 

purposes. The comment further argues 

that 40 CFR part 26 provides that 

applicable DBE regulations apply to 

competitive bids and proposals as 

opposed to micro-purchases (which are 

excepted from competition because of 

their small size), and otherwise 

applying DBE requirements to micropurchase procurements is burdensome. 

FTA Response: FTA declines to make 

a change based on this comment. The 

term ‘‘contract,’’ for purposes of the 

USDOT DBE program, is defined in 

regulation at 49 CFR 26.5. There is no 

contract dollar value threshold in 49 

CFR part 26. An FTA Tier 1 recipient 

that is required to set a DBE goal must 

set its goal as a percentage ‘‘of all FTA 

or FAA funds (exclusive of FTA funds 

to be used for the purchase of transit 

vehicles) that [the recipient] will 

expend’’. 49 CFR 26.45(e). The DBE rule 

does not exclude micro-purchases. FTA 

has issued guidance on reporting 

multiple purchases from the same 

vendor (see FAQ CR10 at https://

www.transit.dot.gov/frequently-askedquestions-fta-grantees-regardingcoronavirus-disease-2019-covid19#COVID-19Civil). 

FTA Minimum Useful Life Policy for 

Rolling Stock and Ferries 

Comment: A commenter urged FTA to 

add examples of common vehicle makes 

and models used in public transit/ 

human services transportation to the 

table detailing the minimum useful life 

for FTA-funded rolling stock and ferries 

in Chapter IV of the circular. 

FTA Response: FTA declines to make 

a change based on this comment. FTA 

does not include specific vehicle makes 

and models in guidance because vehicle 

manufacturers, makes, and models often 

change. Furthermore, this inclusion 

could suggest FTA’s endorsement of 

particular vehicle manufacturers, which 

is inappropriate and goes beyond the 

scope of FTA’s role, mission and 

purview. 

Comment: A commenter stated that 

there should be a nexus between FTA 

minimum useful life requirements and 

Altoona testing. 

FTA Response: FTA declines to make 

a change based on this comment. FTA’s 

bus testing rule, 49 CFR 665.11(e), 

already requires that ‘‘[b]uses shall be 

tested according to the service life 

requirements identified in the 

prevailing published version of FTA 

Circular 5010.’’ While it is unclear what 

further nexus the commenter is 

suggesting, FTA declines to amend the 

circular beyond the requirements of 49 

CFR part 665. 

Comment: A commenter requested 

that FTA add minimum useful life 

thresholds for bus shelters and other 

common transit features. 

FTA Response: FTA declines to make 

a change based on this comment. Useful 

life serves as a benchmark representing 

a reasonable expectation of the duration 

of time for which FTA-funded assets 

should be used by recipients for transit 

purposes. Any benefit of FTA 

prescribing useful life for the many 

different types of bus shelters or other 

common transit features would likely be 

outweighed by the loss of flexibility to 

account for unforeseen factors and allow 

for innovation, as well as the burden on 

FTA and recipients to follow useful life 

standards for inexpensive assets. In 

Chapter IV, FTA seeks to maximize 

flexibility by allowing recipients to 

identify reasonable and common 

methods for determining minimum 

useful life for assets other than vehicles 

and certain facilities and lists examples 

of acceptable methods. 

Rolling Stock Rebuilds and Overhauls 

Comment: One commenter asked FTA 

for additional clarification on 

distinguishing between overhauls and 

rebuilds. The commenter asked whether 

it is the recipient who determines 

whether vehicle work is a rebuild or an 

overhaul. 

FTA Response: FTA declines to make 

a change based on this comment. 

Whether vehicle work is an overhaul or 

a rebuild is determined by the 

remaining useful life of the vehicle at 

the time of the work, and the amount of 

remaining useful life the vehicle will 

have after the work is completed. The 

circular establishes that an overhaul is 

a capital activity enabling a vehicle to 

perform until the end of the vehicle’s 

original, expected useful life. On the 

other hand, the circular explains that 

rebuilds are intended to extend the 

vehicle’s useful life beyond its original 

useful life. The commenter should 

contact the FTA regional office 

responsible for administering its grants 

for further assistance. 

Like-Kind Exchange of Equipment 

Comment: A commenter opined that 

FTA should include examples of 

calculations for like-kind exchanges of 

equipment involving insurance 


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proceeds, as were provided in the preexisting C 5010.1E. 

FTA Response: FTA declines to make 

a change based on this comment. FTA 

consolidated the pre-existing like-kind 

exchange examples into the Equipment 

Disposition Scenarios in Appendix G to 

C 5010.1F. 

Use of Insurance Proceeds Toward 

Damaged or Destroyed FTA-Assisted 

Equipment 

Comment: A commenter requested 

FTA change its policy that subrecipients 

may keep all insurance proceeds 

obtained from claims for loss of 

damaged or destroyed equipment in 

excess of a remaining Federal interest. 

According to the commenter, FTA’s 

interest in a vehicle extinguishes when 

the vehicle has reached its minimum 

useful life, although the vehicle may 

still be in good condition, and ‘‘this 

creates an incentive for a [recipient] to 

deliberately total a federally funded’’ 

vehicle when it has reached the end of 

its useful life to obtain insurance 

proceeds. 

FTA Response: FTA declines to make 

a change in response to the comment. 

FTA’s interest in a vehicle does not 

extinguish when a vehicle reaches its 

minimum useful life as the commenter 

describes. FTA’s interest in the vehicle 

persists until the recipient disposes of 

the vehicle. For any vehicle with a value 

in excess of $10,000, the recipient must 

follow authorized disposition 

procedures and remit to FTA its 

proportional share of the vehicle’s fair 

market value at the time of disposition 

when the fair market value is greater 

than the straight-line depreciated value 

of the vehicle. FTA’s interest is based on 

the greater of a vehicle’s fair market 

value or sale proceeds, if it is sold, or 

alternatively the straight-line 

depreciated value. Section 3 of Chapter 

IV of C 5010.1F describes the process of 

equipment disposition and valuation. 

The commenter is correct that, in the 

case of insurance proceeds received for 

a vehicle taken out of service by 

casualty, FTA claims an interest in the 

insurance proceeds equal to the value of 

FTA’s interest in the vehicle 

immediately before the vehicle was 

taken out of service. If insurance 

proceeds exceed the value of FTA’s 

interest, the recipient may retain the 

excess. This policy protects the Federal 

financial interest and incentivizes 

recipients to adequately insure project 

property in their possession. FTA is not 

aware of examples of its policy driving 

the behavior the commenter is 

concerned about. 

For more information, FTA 

encourages any interested recipient to 

speak with its insurer about the 

consequences of deliberately damaging 

vehicles to collect insurance proceeds. 

Drug and Alcohol Program Compliance 

Audits 

Comment: In relation to drug and 

alcohol compliance audits, a commenter 

requested FTA clarify whether 

recipients’ annual drug and alcohol 

certification is in reference to Drug and 

Alcohol Management Information 

System (DAMIS) reporting or a separate 

requirement. 

FTA Response: FTA declines to make 

a change in response to the comment. 

The circular and FTA’s annual 

Certifications and Assurances are clear 

that the annual certification of drug and 

alcohol testing is separate from the drug 

and alcohol management information 

system reporting that requires 

submission of the previous year’s 

testing. 

Cognizant Federal Agency for Indirect 

Cost Rate Proposals 

Comment: A commenter requested the 

circular provide that indirect cost rate 

proposals (ICRPs) need to be approved 

by the cognizant Federal agency and to 

provide clarification for determining the 

cognizant agency for subrecipients’ 

indirect costs as distinct from the 

cognizant agency for audits. 

FTA Response: FTA declines to make 

a change in response to the comment. In 

Chapter VI, the circular states, ‘‘ICRPs 

must be approved by FTA or another 

legally designated cognizant Federal 

agency’’. The circular, in Section 7 of 

Chapter VI, also states the method of 

determining agency cognizance: ‘‘DOT 

is the cognizant agency of indirect costs 

for State and local airport and port 

authorities and transit districts’ 

cognizant audit agencies. Based on 

delegations within DOT, FTA is 

cognizant for transit districts. For other 

organizations, cognizance is generally 

assigned to the Federal agency that 

provides the predominant amount of 

Federal funding to a recipient within a 

given departmental organization within 

the State or locality.’’ Appendix I 

explains that ICRPs are prepared by an 

individual recipient or subrecipient to 

substantiate an indirect cost rate. 

De Minimis Rate for Indirect Costs 

Comment: A commenter requested 

FTA to leave the de minimis rate for 

indirect costs unspecified in the 

circular, in case the de minimis rate is 

changed by subsequent legislation or 

rulemaking. 

FTA Response: FTA declines to make 

a change in response to the comment. 

FTA has updated the de minimis rate in 

the circular to 15 percent, in accordance 

with the revision to 2 CFR 200.414(f). 

The de minimis rate has changed only 

once since the original part 200 was 

published in 2014. The convenience to 

readers of stating the de minimis rate in 

the circular outweighs the potential 

inconvenience if the de minimis rate 

changes again in the future and the 

circular must be updated. 

Relationship of Circular to FTA Master 

Agreement 

Comment: One commenter suggested 

that instead of describing ethical 

standards, certifications, and 

procurement standards in Chapter II of 

the circular, FTA simply refer the reader 

to FTA’s Master Agreement, because the 

requirements derive from the Master 

Agreement, and the Master Agreement 

is subject to change. 

FTA Response: FTA declines to make 

a change in response to the comment. 

The commenter did not cite a specific 

requirement, but generally speaking, the 

procurement requirements derive both 

from Federal regulations, like 2 CFR 

part 200, and FTA’s Master Agreement. 

Where a requirement has more than one 

source, the circular generally cites only 

to the regulation so as not to overcrowd 

the document with citations. The 

convenience to the reader of stating 

requirements in the circular outweighs 

the potential inconvenience if a 

requirement should change in the future 

and the circular must be updated. For 

more information about the standards 

that apply to procurements carried out 

under FTA awards, refer to the latest 

version of FTA’s C 4220. 

Requests To Change Statutory or Other 

Government-Wide Regulatory 

Requirements 

FTA received some comments 

requesting changes to requirements that 

are based in statutes or regulations that 

FTA does not have the authority to 

change. 

Comment: One commenter asked FTA 

to reinsert language in the definition for 

‘‘Associated Transit Improvement’’ to 

include landscaping for stormwater 

absorption and erosion prevention, 

consistent with version C 5010.1E of the 

circular. 

FTA Response: FTA declines to make 

a change in response to the comment. 

The definition of ‘‘Associated Transit 

Improvement’’ is given in statute at 49 

U.S.C. 5302(2). Note that certain kinds 

of landscaping may remain eligible as 

‘‘functional landscaping’’ under the 

definition of ‘‘Associated Transit 

Improvement.’’ 


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Comment: A commenter requested 

that FTA include fares as a permissible 

source of local match. 

FTA Response: FTA declines to make 

a change in response to the comment. 

Federal law excludes fares as an eligible 

source of local match for FTA financial 

assistance. E.g., 49 U.S.C. 5307(d)(3) 

(‘‘the remainder of the net project costs 

shall be provided . . . in cash from nonGovernment sources other than 

revenues from providing public 

transportation services’’). Generally, 

financial assistance from FTA may only 

fund up to the permissible Federal share 

of the ‘‘net project cost’’ of eligible 

projects. The term ‘‘net project cost’’ 

means the part of a project that 

reasonably cannot be financed from 

revenues (49 U.S.C. 5302(13)). 

Comment: One commenter requested 

the circular only reference national 

flood insurance coverage thresholds as 

the required coverage for FTA-funded 

facilities in special flood hazard areas, 

which the commenter alleges would 

‘‘avoid confusion due to the 

unavailability of substantial flood 

insurance policies or policies that fully 

ensure agency’s assets and facilities.’’ 

FTA Response: FTA declines to make 

a change in response to the comment. 

The circular does not require that 

recipients obtain full flood insurance 

coverage over project property. The 

circular cites 42 U.S.C. 4013(b)(4), 

which sets the minimum flood 

insurance coverage requirements. 

Comment: One commenter 

recommended FTA remove language 

from Chapter III stating that milestone 

progress reports (MPRs) and Federal 

financial reports (FFRs) must be 

submitted to FTA within 30 days after 

the end of each quarter, as the 

commenter opines that 30 days is not 

sufficient to research, document, and 

provide explanations for variances that 

arise between MPRs and FFRs due to 

differences in the timing of project 

progress and project invoice 

submissions. The commenter further 

recommended FTA provide reporting 

frequencies and submission deadlines 

as best practices rather than 

requirements. 

FTA Response: FTA declines to make 

a change based on this comment. Per 2 

CFR 200.329, the recipient must submit 

regular performance reports. Reports 

that are due more frequently than 

annually, like the quarterly submitted 

MPRs, ‘‘must be due no later than 30 

calendar days after the reporting 

period.’’ FTA does not have the 

discretion to deviate from this 

government-wide regulation. 

B. Changes Based on Public Comments 

Comments below reflect areas where 

FTA made language changes in the 

circular in response to public 

comments. 

Effective Date for Updated Circular 

Comment: One commenter noted the 

circular’s lack of a stated effective date 

or a statement of how existing awards 

and third-party agreements will be 

affected by C 5010.1F. The commenter 

asked if FTA will adjust its compliance 

reviews to account for differing 

applicable requirements based on the 

applicable date of circular C 5010.1F. 

FTA Response: In response to this 

comment, FTA included the circular’s 

applicable date, November 1, 2024, in 

the first paragraph of the circular. FTA 

also added a statement to clarify the 

legal effect of the circular on FTA 

recipients. As a guidance document, the 

circular does not have the force and 

effect of law and is not meant to bind 

the public in any way. The circular is 

intended only to provide clarity to the 

public regarding existing requirements 

under the law or agency policies. 

Some of the revisions made in C 

5010.1F describe changes in law or 

policy that took effect before the 

applicable date of C 5010.1F. Those 

changes apply according to their 

respective terms. Other circular 

provisions reflect long-standing FTA 

operating procedures to which notice 

was already provided or not required. 

Future compliance reviews conducted 

by FTA will account for the applicable 

effective dates. 

Changes Made to Definitions in the 

Circular 

Comment: One commenter said the 

proposed circular’s definition of 

‘‘Shared Use’’ appeared to only apply to 

real property. The comment requested 

that FTA modify the definition to 

explicitly include shared use of 

equipment, including rolling stock. 

FTA Response: FTA updated this 

definition to explicitly note shared use 

can apply to equipment, including 

rolling stock. 

Comment: A commenter asked FTA to 

define Qualified Human Service 

Organization (QHSO) and provide 

additional guidance regarding the 

exception of QHSOs from the 

restrictions of FTA recipients to provide 

charter bus services contained in 49 

U.S.C. 5323(d). 

FTA Response: FTA added a 

definition of QHSO to C. 5010.1 using 

the same definition provided at 49 CFR 

604.3(q) for consistency. Additional 

language addressing QHSO exceptions 

was not added to the circular because 49 

CFR part 604 addresses charter service. 

49 CFR 604.7 provides the necessary 

guidance for QHSOs providing charter 

bus services. No further guidance from 

the circular is required at this time. 

Information on Specific Discretionary 

Programs 

Comment: One commenter asked FTA 

to include a reference to FTA’s 

passenger-only ferry program in the list 

of current FTA programs in Chapter II. 

FTA response: FTA added the 

Passenger Ferry Discretionary Program 

(49 U.S.C. 5307(h)) to the list of current 

FTA programs. 

Request for Reference to Additional 

Resource 

Comment: One commenter asked FTA 

to include a reference to the 

Coordinating Council on Access and 

Mobility (CCAM) Federal Fund Braiding 

Guide in Chapter VI as a resource for 

recipients to understand which sources 

of Federal funds may be used as local 

match for FTA-funded activities. 

FTA Response: FTA added a reference 

to the CCAM Federal Fund Braiding 

Guide and a link to the online resource. 

Incidental and Shared Uses 

Comment: One commenter requested 

that FTA include examples of shared 

use and incidental use of equipment 

similar to the circular’s examples of 

shared use and incidental use of real 

property, further suggesting FTA 

include a table clarifying the difference 

between the two, as well as the 

applicable Federal rules for each. 

FTA Response: In response to this 

comment, FTA included examples for 

the shared use and incidental use of 

equipment in Chapter IV of the circular. 

FTA did not include a table clarifying 

the difference between the two 

concepts, as the difference between the 

two concepts is sufficiently described in 

both Chapter IV and the circular’s 

definitions. 

Comment: A commenter asked FTA to 

explain if FTA must always provide 

prior approval for shared use of real 

property. The commenter also asked if 

it was appropriate for FTA to refer to the 

allocable costs of construction for 

equipment that may qualify as a shared 

use for determining such a shared use’s 

pro rata share. 

FTA Response: The circular already 

states that a shared use of property 

requires prior FTA approval except 

when it involves coordinated public 

transit-human services transportation. 

However, the word ‘‘construction’’ was 

replaced with ‘‘acquisition’’ to refer to 

the usual process for acquiring 


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equipment that may qualify as a shared 

use. 

Comment: A commenter requested 

that the circular address incidental and 

shared uses of equipment and supplies 

by a non-controlling subrecipient for a 

public transportation use. 

FTA Response: In response to this 

comment, FTA updated language 

addressing the concept of shared use for 

both real property and equipment in 

Chapter IV to clarify that shared uses 

can be arranged with any third-party 

user of project property, regardless of 

the type of entity, and is not limited 

only to non-transit entities or uses. 

Accordingly, a subrecipient’s use of a 

recipient’s real property or equipment 

can qualify as a shared use. However, 

FTA declines to change the language 

addressing incidental uses because the 

circular accurately reflects FTA’s intent 

to define ‘‘Incidental Use’’ as the limited 

non-transit use of project property. A 

subrecipient’s use of a recipient’s 

project property for public 

transportation is not an incidental use 

because a subrecipient’s activities are 

inherently public transportation. 

Comment: One commenter requested 

that FTA remove the language 

addressing the incidental use of real 

property under the Property 

Management subsection in Chapter IV 

because the circular provides the same 

language under the Non-transit Uses of 

FTA-Assisted Real Property subsection 

in the same chapter. 

FTA Response: In response to this 

comment, FTA removed the language 

regarding incidental use in Chapter IV’s 

section on general use of project 

property, while retaining the same 

language in the section on incidental 

use. 

Intercity Bus 

Comment: One commenter asked that 

the circular recognize intercity bus as a 

non-incidental use, in other words, that 

intercity bus should be recognized in 

FTA guidance as a primary 

transportation use at FTA-funded 

facilities. The commenter stated that 

this request was because of challenges 

and delays intercity bus companies 

experience trying to obtain reasonable 

access for intercity bus at federally 

funded public transportation facilities. 

FTA Response: FTA has added text to 

Chapter IV of C 5010.1F emphasizing 

the requirements of 49 U.S.C. 5323(r). 

According to 49 U.S.C. 5323(r), a 

recipient of FTA assistance may not 

deny reasonable access for a private 

intercity or charter transportation 

operator to federally funded public 

transportation facilities, including 

intermodal facilities, park-and-ride lots, 

and bus-only highway lanes. 

FTA declines to exclude intercity bus 

uses as a potential type of incidental 

use. By statute, 49 U.S.C. 5302(15) and 

49 U.S.C. 5311, intercity bus service is 

not public transportation. The circular’s 

definition of incidental use does not 

diminish the requirement in 49 U.S.C. 

5323(r) that transit agencies must 

provide reasonable access because it is 

reasonable to ensure that intercity bus 

use does not conflict with the transit 

purpose of the project property or the 

recipient’s ability to maintain 

satisfactory continuing control over the 

use of the property. Therefore, 

reasonable access provided to intercity 

bus service at an FTA-funded facility 

may be an incidental use of such a 

facility. 

Comment: One commenter requested 

that FTA revise the circular to state that 

recipients should give intercity bus 

companies access to transit property at 

low or no cost. In C 5010.1F, FTA added 

a description of ‘‘no- or low-income’’ 

uses of transit property (those that bring 

little revenue to the recipient but serve 

a public purpose) as a kind of incidental 

use recipients may consider. The 

commenter suggested that FTA 

recategorize no- or low-income uses as 

distinct from incidental uses, under a 

new category such as ‘‘Non-Incidental,’’ 

‘‘Primary,’’ or ‘‘Intercity Transportation’’ 

use. The commenter then requested that 

FTA state that intercity bus companies 

should be treated as a no- or low-cost 

use because they are a form of 

transportation with public benefits. 

FTA Response: In response to this 

comment, FTA added a subsection to 

the circular to highlight the 

requirements of 49 U.S.C. 5323(r), 

which says recipients may not deny 

intercity bus companies and charter 

companies reasonable access to transit 

facilities. However, FTA declines to 

recategorize no- or low-income use 

separately from incidental use. FTA’s 

incidental use policy is intended to 

cover all non-transit uses occurring on 

transit property, regardless of the 

revenue they create for FTA’s recipient. 

The purpose of the circular’s 

description of no- or low-income uses is 

to recognize a recipient’s flexibility to 

allow less-than-market rates for uses 

that provide benefits that complement 

public transportation services 

notwithstanding their low potential for 

revenue to the transit system. The 

categorization of any use as an 

incidental use is not a statement as to 

the importance of the use. 

Additionally, FTA declines to 

describe intercity bus as a no- or lowincome use. The access provision of 49 

U.S.C. 5323(r) requires that recipients 

not deny intercity bus companies 

reasonable access to transit assets, but 

reasonable access does not require no 

cost or low cost access, although a 

recipient may determine that intercity 

bus service is an appropriate no- or lowincome use depending on the location 

and its unique situation. FTA intends 

that its recipients have the full 

flexibility to bargain for what is 

reasonable in each situation, taking into 

consideration the public benefit of the 

proposed use, the costs the recipient 

incurs by allowing the use, the impact 

of the use on the recipient’s operations, 

market rates, the value of the access to 

the non-transit entity, possible 

alternative uses, and other factors as 

determined by the recipient. 

Real Property Status Reporting 

Comment: One commenter 

recommended that FTA remove the 

additional elements now included in 

the updated circular’s list of required 

information a recipient must include in 

its real property status reports, saying 

that records containing the additional 

information may not exist, require 

significant funds to generate, or 

otherwise would be burdensome to 

produce. The commenter further stated 

that 2 CFR 200.330 only requires 

recipients to generate real property 

status reports on a regular basis and 

does not require FTA acquire such 

information. 

FTA Response: FTA declines to make 

any changes in response to this 

comment. Recipients must maintain 

adequate records for FTA’s monitoring 

of recipients’ compliance with Federal 

requirements. A real property status 

report would be inadequate to assess 

compliance with FTA real property 

requirements without the specified 

information. However, FTA modified 

the ‘‘Current Use(s) of the Property’’ 

element to prompt reporters to identify 

whether a significant change has 

occurred to a parcel of real property or 

is anticipated to occur in the next 

reporting period, and, if so, to describe 

the change. Further, FTA clarified 

language that some of the reporting 

elements apply to real property 

dispositions. 

Comment: One commenter requested 

that FTA not require recipients to report 

the date of property disposition or the 

sale price and net proceeds in their real 

property status reports following 

property disposition. 

FTA Response: FTA declines to 

remove the property disposition date, 

sales price, and related proceeds from 

the list of property status report 

elements because the information is 


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necessary to sufficiently assess a 

recipient’s compliance with 

requirements regarding real property 

disposition and accounting for FTA’s 

interest in the property. However, in 

response to this comment, FTA added 

language explaining that recipients 

should include the requisite disposition 

information for real property disposed 

within a three-year reporting cycle in 

the following real property status report, 

but recipients may remove the 

disposition information from the real 

property status reports thereafter. 

Equipment Disposition Scenarios— 

Appendix G 

Comment: One commenter asserted 

that the equipment disposition 

scenarios in Appendix G contain two 

errors. The commenter said the second 

paragraph of the appendix should 

indicate that the insurance proceeds 

received by the recipient are more than 

the Federal share for the example unit 

of equipment rather than less than the 

Federal share. The commenter also said 

that language in the third paragraph of 

the appendix should indicate that the 

insurance proceeds received by the 

recipient are less than the Federal share 

for the example unit of equipment 

rather than more than the Federal share. 

FTA Response: In response to this 

comment, FTA adjusted the language 

referenced by the commenter to 

accurately show the relationship 

between the amount of insurance 

proceeds and the respective Federal 

share for the example units of 

equipment in the scenarios presented. 

Comments Requesting Clarifications or 

Specificity 

FTA received several requests for 

clarification or more specificity on 

various requirements. In response, FTA 

revised language in the circular to 

address comments, as explained below. 

Inventory of Vehicle Components 

Comment: Three commenters 

expressed concerns regarding the 

requirement for recipients to identify 

and inventory vehicle components 

removed from a vehicle at the end of the 

vehicle’s useful life that retain a Federal 

interest. The commenters opined that 

such treatment would exact an 

administrative burden for transit 

agencies and auditors because of the 

large volume of low-value components 

that fall into this category. 

FTA Response: In response to this 

comment, FTA clarified in the circular 

that a recipient only must inventory a 

removed vehicle component when the 

component meets the definition of 

‘‘equipment.’’ 2 CFR 200.1 and the 

circular define equipment as tangible 

property having a useful life of more 

than one year and a per-unit acquisition 

cost that equals or exceeds the lesser of 

the capitalization level established by 

the recipient for financial statement 

purposes, or $10,000. 

Transfer of Real Property for Affordable 

Housing 

Comments: A commenter submitted 

multiple comments related to provisions 

for the transfer of real property for 

affordable housing purposes as part of a 

transit-oriented development (TOD). 

One comment expressed safety concerns 

with the combination of housing with 

transit facilities and asserted that any 

such developments that combine the 

two should include separation 

requirements between those uses. 

Another comment suggested that 

restrictions on the use of transferred real 

property for low-cost housing could 

limit complementary ancillary services 

for transit patrons associated with 

transit facilities located in mixed-use 

environments. An additional comment 

expressed concerns and confusion with 

the transfer criteria potentially 

excluding governmental entities and 

non-profit organizations. 

FTA Response: In response to this 

comment, FTA changed the title of the 

subsection in Chapter IV from ‘‘Transfer 

for Transit Oriented Development’’ to 

‘‘Transfer for Affordable Housing for 

Transit Oriented Development’’ to 

clarify that this transfer authority is 

specific to affordable housing in a TOD 

environment, not all TOD initiatives. 

However, no additional changes were 

made based on these comments. The 

affordable housing requirements do not 

prevent the inclusion of additional 

ancillary services beyond those that 

could support affordable housing. The 

provisions of 49 U.S.C. 5334(h)(1)(B) do 

not prohibit recipients’ abilities to 

engage in TOD initiatives or additional 

transit-related services, but rather 

provide one permissible disposition 

option for affordable housing projects 

meeting the statutory requirements. 

Further, this asset disposition provision 

prioritizes transfer to governmental 

entities and non-profit organizations. 

An asset may only be transferred to a 

third-party entity if a local government 

authority or nonprofit organization is 

unable to develop the property. For 

additional information about the asset 

disposition provision, please see FTA’s 

Interim Asset Disposition Guidance at 

https://www.transit.dot.gov/funding/ 

funding-finance-resources/interimasset-disposition-guidance. 

Asset Disposition 

Comment: Two commenters requested 

that FTA increase the disposition 

threshold from $5,000. One commenter 

also requested that FTA permit 

recipients to retain all proceeds 

obtained through the resale of FTAassisted vehicles to supplement open 

grants. 

FTA Response: FTA edited language 

addressing disposition of equipment 

and supplies in Chapter IV to conform 

with changes IIJA made to 49 U.S.C. 

5334(h)(4)(B), as well as changes to 2 

CFR part 200 that took effect on October 

1, 2024. Per 2 CFR 200.313 and 200.314, 

equipment with a per unit value of 

$10,000 or less and unused supplies 

with an aggregate value of $10,000 or 

less may be retained, sold, or otherwise 

disposed of with no further 

responsibility to FTA. If the proceeds 

are greater than $10,000, then per 49 

U.S.C. 5334(h)(4)(B), the recipient may 

retain $5,000 and the percentage of the 

local share in the original award of the 

remaining proceeds, with the remaining 

Federal share returned to FTA. Because 

49 U.S.C. 5334(h)(4)(B) requires 

recipients to return to FTA the FTA 

share of proceeds from the sale of 

rolling stock, FTA does not have 

discretion to allow recipients to retain 

these proceeds to supplement open 

grants. 

Comment: A commenter asked FTA to 

provide further guidance regarding the 

disposition of supplies and attendant 

insurance proceeds, mentioning that 

pre-existing C 5010.1E provided 

detailed information on the topic. 

FTA Response: In response to this 

comment and to reflect updates to 2 

CFR 200.314, FTA included additional 

language identifying the treatment of the 

disposition of supplies. In several places 

where C 5010.1F discusses the 

application of disposition rules to 

equipment, FTA has added a statement 

that disposition rules also apply to 

unused supplies the aggregate value of 

which exceeds $10,000. FTA does not 

have any unique considerations 

regarding the disposition of supplies 

beyond what is directed in 2 CFR 

200.314. Furthermore, FTA’s treatment 

of insurance proceeds applies similarly 

to all project property. Equipment 

disposition scenarios that involve 

insurance proceeds are provided in 

Appendix G of the C 5010.1F. The same 

examples illustrate FTA’s treatment of 

disposition of unused supplies. 

Therefore, no further guidance is 

necessary to further illustrate FTA’s 

treatment of the disposition of supplies 

or attendant insurance proceeds from 

claims arising for the loss of supplies. 


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Buy America 

Comment: One commenter 

recommended that FTA remove the 

summaries of ‘‘Buy America Domestic 

Preference’’ in Chapter II and, instead, 

only use the circular to refer FTA grant 

recipients to current Buy America 

regulations at 49 CFR part 661, 2 CFR 

part 184, and the Office of Management 

and Budget’s (OMB’s) implemented 

guidance for Build America, Buy 

America (BABA). The commenter was 

concerned that the summary of these 

requirements in C 5010.1F may inhibit 

compliance by overly simplifying 

complex requirements. 

FTA Response: FTA understands the 

commenter’s concern and agrees that 

recipients always should refer to the 

actual laws and regulations cited in the 

circular. However, FTA declines to 

adopt the commenter’s suggestion. C 

5010.1F strikes a balance between 

informing readers of the broad 

requirements of Buy America while 

recognizing that actual rules are 

complicated. Moreover, directing 

recipients to regulations without 

additional context may also be 

confusing. The application of the Build 

America, Buy America Act domestic 

preference, located at 2 CFR part 184, is 

only partially applicable to FTA 

financial assistance awards because 

FTA’s existing Buy America 

requirements at 49 U.S.C. 5323(j) 

continue to apply where they meet or 

exceed the Build America, Buy America 

Act requirements. 

However, FTA updated a reference 

from a superseded OMB memorandum 

to its current version and corrected a 

misstatement in the circular’s text. The 

proposed version of C 5010.1F had said 

that 49 CFR 663.37 exempts some 

vehicle purchases from the auditing 

requirement, when 49 CFR 663.37 

actually exempts those purchases from 

the resident inspector requirement. 

Transit Vehicle Manufacturer (TVM) 

Compliance Under FTA’s 

Disadvantaged Business Enterprise 

(DBE) Program 

Comment: A commenter requested 

FTA include a clarification in Chapter II 

that recipients are not restricted to 

solicit bids from DBE-eligible transit 

vehicle manufacturers (TVMs). The 

commenter states that bid respondents 

could be other third parties, such as 

authorized dealers, which can also be 

bound by the TVM requirements. 

FTA Response: In response to this 

comment, FTA expanded relevant 

language explaining that recipients may 

seek bids from entities other than 

vehicle manufacturers, such as 

dealerships, who certify that the 

procured vehicles are, or will be, 

manufactured by DBE-eligible TVMs. 

Rolling Stock Spare Ratio Policies 

Comment: A commenter requested 

that FTA exempt the requirement to 

report spare ratios for subrecipients 

whose spare ratios are not limited to 20 

percent. The commenter also asked FTA 

to clarify whether a direct recipient or 

the subrecipient’s maximum spare ratio 

would apply when the direct recipient 

is seeking funding to procure vehicles 

on behalf of a subrecipient. 

FTA Response: In response to this 

comment, FTA added a statement in its 

spare ratio policy clarifying that FTA 

calculates each transit operator’s 

maximum spare ratios separately, based 

on each separate operator’s fleet size, 

without regard to their status as a direct 

recipient or subrecipient. FTA’s spare 

ratio policy is that recipients with 50 or 

more fixed-route vehicles limit their 

spare ratio to 20 percent of the number 

of vehicles operated in maximum fixedroute service. This requirement extends 

to subrecipients’ separate fleets 

individually, and their fleets are not 

imputed to the recipient. For individual 

operators with fewer than 50 fixed-route 

vehicles, whether they are recipients or 

subrecipients, FTA does not set a 

specific maximum spare ratio but 

expects the number of spare vehicles to 

be reasonable, considering the number 

of vehicles and variety of vehicle types 

and sizes. 

Recipient-to-Recipient Transfer of 

Rolling Stock 

Comment: A commenter requested 

that FTA clarify that recipient-torecipient transfers of rolling stock are 

used for instances in which the useful 

life of the rolling stock has not yet been 

met. 

FTA Response: In response to this 

comment, in Chapter IV, FTA has 

amended the language specific to 

recipient-to-recipient transfers of rolling 

stock to clarify that recipients should 

provide FTA with certain 

documentation when seeking FTA’s 

approval of recipient-to-recipient 

transfer of rolling stock with a 

remaining useful life. The language in 

Chapter III addressing recipient-torecipient transfers of rolling stock does 

not exclusively apply to rolling stock at 

the end of its useful life. Rather, the 

language specifically addresses the 

differing requirements and 

considerations when transferring rolling 

stock that does or does not have a 

remaining useful life. 

C. Request for Technical Assistance 

Comment: FTA received a comment 

requesting more targeted technical 

assistance on new information included 

in Appendices A, B, and C. The 

commenter also asked FTA to provide 

guidance regarding recipient legal 

capacity requirements outlined in 

Appendix A. Lastly, the commenter 

asserted that pre-award requirements in 

Appendix B include substantial changes 

that may require proper lead time for 

agencies to prepare for the 

requirements. 

FTA Response: FTA declines to make 

any changes in the circular in response 

to this comment. However, FTA will 

provide training and technical 

assistance opportunities regarding 

updates made to this and the other 

simultaneously issued program circulars 

(C 9040.1H, C 9070.1H, C 9050.1A). 

III. Other Updates 

In addition to the changes noted 

above, FTA made revisions in this final 

circular for consistency with changes in 

statute, regulation, and other FTA 

circulars, as well as minor, nonsubstantive revisions for clarity. For 

consistency with statute, FTA added 

language in Chapter IV identifying 

alternative fueling facilities as a 

potential type of incidental use of both 

real property and equipment in 

accordance with 49 U.S.C. 5323(p). 

Additionally, FTA added a statement at 

the beginning of the circular that in 

cases for which the circular is 

inconsistent with changes to any law, 

the law will supersede this circular. 

Along with other non-substantive 

administrative changes that were 

recommended by several commenters, 

FTA made additional corrections in the 

circular for typographical errors, 

grammatical errors, and formatting. 

Updates Based on Regulatory Changes 

Since C 5010.1F was released for 

public comment on February 14, 2024, 

several government-wide regulations 

have changed. FTA has accordingly 

updated the 5010.1 circular to reflect 

changes in the law since that time, 

including the following: 

2 CFR Part 200 Changes 

The Office of Management and Budget 

(OMB) updated the government-wide 

policies for the Uniform Administrative 

Requirements, Cost Principles, and 

Audit Requirements for Federal Awards 

under 2 CFR part 200 as well as parts 

25, 175, and 180, effective October 1, 

2024, including but not limited to the 

following: 

• Equipment and Aggregate Supplies 

Definitions/Thresholds: Sections 


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Federal Register / Vol. 89, No. 188 / Friday, September 27, 2024 / Notices 79345 

200.313 (Equipment) and 200.314 

(Supplies) of 2 CFR part 200 each 

increase the thresholds, from $5,000 to 

$10,000, for the value of equipment and 

aggregate supplies a recipient may 

retain, sell, or dispose of at closeout. 

Consistent with 2 CFR 200.314, FTA 

also clarified throughout the circular 

that disposition requirements apply 

only to unused supplies. 

• De Minimis Rate: 2 CFR part 200 

increases the de minimis indirect cost 

rate from 10% to 15% of Modified Total 

Direct Costs (MTDC). FTA recipients 

and subrecipients may elect a lower de 

minimis rate at their discretion and 

modify the indirect cost rate of MTDC 

to permit inclusion of the first $50,000 

of any one subaward in the base. 

• Single Audit: 2 CFR part 200 

increases the direct Federal expenditure 

threshold requiring a recipient to 

conduct a single audit from $750,000 to 

$1 million. OMB also revised the 

definitions of ‘‘known questioned costs’’ 

and ‘‘likely questioned costs’’ while 

providing additional direction to 

recipients to identify such costs in an 

audit report. 

Uniform Act Changes 

Acting as Lead Agency, FHWA 

published a final rule on May 3, 2024, 

to amend and update 49 CFR part 24, 

which implements the Uniform 

Relocation Assistance and Real Property 

Acquisition Policies Act (Uniform Act) 

for land acquisition and displacement 

activities by all Federal agencies and 

their financial assistance recipients (89 

FR 36908). These regulations clarify 

existing requirements for implementing 

the Uniform Act, meet modern needs, 

and improve the agencies’ service to 

individuals and businesses affected by 

Federal or federally assisted projects. 

All references to these regulations were 

updated in C 5010.1F. 

Disadvantaged Business Enterprise 

(DBE) Final Rule Changes 

On April 9, 2024, the U.S. Department 

of Transportation published its final 

rule regarding Participation by 

Disadvantaged Business Enterprises 

(DBE) in Department of Transportation 

Financial Assistance Programs located 

at 49 CFR part 26 (89 FR 24898). 

Changes to the rule include a 

streamlined DBE certification process, 

adjustments to grant recipient reporting 

requirements, and other technical 

corrections. For FTA specifically, the 

rule creates two tiers of recipients: Tier 

I recipients who award more than 

$670,000 in FTA funds annually in 3rd 

party contracts and are subject to all 

DBE program provisions and Tier II 

recipient who award $670,000 or less in 

FTA funds annually and are subject to 

a subset of provisions. 

Veronica Vanterpool, 

Deputy Administrator. 

[FR Doc. 2024–22160 Filed 9–26–24; 8:45 am] 

BILLING CODE 4910–57–P 

DEPARTMENT OF TRANSPORTATION 

Federal Transit Administration 

[Docket No. FTA–2024–0004] 

Rural Areas Formula Grant Programs 

Guidance, Final Circular 

AGENCY: Federal Transit Administration 

(FTA), Department of Transportation 

(DOT). 

ACTION: Notice of availability of final 

circular and response to comments. 

SUMMARY: The Federal Transit 

Administration (FTA) has finalized an 

updated circular, to assist recipients in 

their implementation of the Rural Areas 

Formula Program and the rural 

component of the Grants for Buses and 

Bus Facilities Program. The update and 

consolidation of the circulars 

incorporates provisions from the Fixing 

America’s Surface Transportation 

(FAST) Act; the Infrastructure 

Investment and Jobs Act (IIJA), also 

known as the Bipartisan Infrastructure 

Law (BIL); the Uniform Administrative 

Requirements for Federal awards to 

non-Federal entities; and current FTA 

policies and procedures. This notice 

responds to the comments FTA received 

on the proposed circular, which was 

published in the Federal Register on 

April 4, 2024. 

DATES: The applicable date of this 

circular is November 1, 2024. 

ADDRESSES: One may view the 

comments at docket number FTA–2024– 

0004. For access to the docket, please 

visit https://www.regulations.gov or the 

Docket Operations office located in the 

West Building of the United States 

Department of Transportation, Room 

W12–140, 1200 New Jersey Avenue SE, 

Washington, DC 20590, between 9 a.m. 

and 5 p.m. Monday through Friday. 

FOR FURTHER INFORMATION CONTACT: For 

Rural Formula program questions, Matt 

Lange, Office of Transit Programs, 

Federal Transit Administration, US 

DOT Volpe Center, 220 Binney Street, 

Room-940, Cambridge, MA 02142, 

phone: (617) 494–6308, or email, 

matthew.lange@dot.gov. For Bus and 

Bus Facilities program questions, 

Kirsten Wiard-Bauer, Office of Transit 

Programs, Federal Transit 

Administration, 1200 New Jersey Ave. 

SE, Washington, DC 20590, phone: (202) 

366–7052, or email, KirstenWiardBauer@dot.gov. For Tribal Transit 

Program questions, Elan Flippin, Office 

of Transit Programs, phone: (202) 366– 

3800, or email, elan.flippin@dot.gov. 

For legal questions, Bonnie Graves, 

Office of Chief Counsel, phone: (202) 

366–0944, or email, Bonnie.Graves@

dot.gov. 

SUPPLEMENTARY INFORMATION: 

Table of Contents 

I. Overview 

II. Responses to Public Comments 

A. Disposition of Comments for Which No 

Changes Were Made 

B. Changes Made as a Result of Public 

Comments 

C. 2 CFR Part 200 Updates 

I. Overview 

The Federal Transit Administration’s 

(FTA) final circular, ‘‘Rural Areas 

Formula Grant Programs Guidance,’’ C 

9040.1H, is a consolidation of guidance 

for Rural Areas Formula Grants Program 

under 49 U.S.C. 5311 (Circular 9040.1) 

and the rural area component of the 

Grants for Buses and Bus Facilities 

Program under 49 U.S.C. 5339(a) 

(Circular 5100.1). Additionally, this 

updated circular incorporates 

provisions of the FAST Act (Pub. L. 

114–94), the Infrastructure Investment 

and Jobs Act (IIJA) (Pub. L. 117–58), and 

other changes in law, and includes 

program-specific guidance for these 

formula programs. Additional 

requirements for all grant programs are 

identified in FTA’s Award Management 

Requirements (Circular 5010.1). 

The update to Circular 9040.1 

consolidates and summarizes 

programmatic information, streamlines 

pre-existing guidance from the two 

program circulars, and reduces 

duplication of information provided 

between the Rural Areas Formula 

Program circular and FTA’s other topicspecific circulars, including by moving 

certain text applicable to most or all 

FTA grant programs to Circular 5010.1. 

Furthermore, the circular incorporates 

statutory changes and clarifies policies 

as applied by FTA. Statutory changes 

for Section 5311 include additional 

sources of local share; in-kind match for 

intercity bus service; and fund 

allocations for tribes. Statutory changes 

for Section 5339(a) include the 

application of Section 5311 

requirements to Section 5339 grants in 

rural areas; additional source for local 

share; additional eligible entities; and 

use of procurement tools authorized 

under Section 3019 of the FAST Act. 

Policy clarifications address topics in 

the existing program circulars, 

including consolidation of grants to 


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