This section of the FEDERAL REGISTER

contains notices to the public of the proposed

issuance of rules and regulations. The

purpose of these notices is to give interested

persons an opportunity to participate in the

rule making prior to the adoption of the final

rules.

Proposed Rules Federal Register

9231 

Vol. 80, No. 34 

Friday, February 20, 2015 

DEPARTMENT OF TRANSPORTATION 

Federal Highway Administration 

23 CFR Part 515 

[Docket No. FHWA–2013–0052] 

RIN 2125–AF57 

Asset Management Plan 

AGENCY: Federal Highway 

Administration (FHWA), Department of 

Transportation (DOT). 

ACTION: Notice of proposed rulemaking 

(NPRM). 

SUMMARY: The FHWA proposes to 

establish a process for the development 

of a State asset management plan in 

accordance with section 1106 of the 

Moving Ahead for Progress in the 21st 

Century Act (MAP–21), to improve or 

preserve the condition of the assets and 

the performance of the National 

Highway System (NHS) as they relate to 

physical assets. In this document ‘‘asset 

management plan’’ and ‘‘risk-based 

asset management plan’’ are used 

interchangeably. An asset management 

plan is a key management tool for 

highway infrastructure owners. State 

departments of transportation (State 

DOT) increasingly use asset 

management plans to make decisions 

about where and when to invest State 

and Federal funds in highway 

infrastructure improvements to achieve 

and sustain a desired state of good 

repair over the life cycle of the assets at 

minimum practicable cost. The 

development and implementation of an 

asset management plan also is an 

important part of the overall MAP–21 

framework for enhancing the 

management and performance of 

transportation highway infrastructure 

funded through the Federal-aid highway 

program (FAHP). The asset management 

plan required by section 1106 of MAP– 

21 will provide States with critical data 

and identify investment and 

management strategies to improve or 

preserve the condition of the assets and 

the performance of the NHS. Under 

section 1106, the plan must include 

strategies leading to a program of 

projects that would make progress 

toward achievement of the State targets 

for asset condition and performance of 

the NHS in accordance with section 

1203(a) of MAP–21, and supporting 

progress toward the achievement of the 

national goals identified in section 

1203(a). 

While the primary purpose of this 

proposed rule is to address asset 

management plan requirements in 

section 1106, this proposed rule also 

would address other MAP–21 

requirements that relate to asset 

management. The proposed rule defines 

the minimum standards that States 

would use in developing and operating 

highway bridge and pavement 

management systems as required by 

section 1203(a) of MAP–21. Also, this 

proposed rule would address the 

requirements in section 1315(b) of 

MAP–21 by requiring States to conduct 

statewide evaluations to determine if 

reasonable alternatives exist to roads, 

highways, or bridges that repeatedly 

require repair and reconstruction 

activities from emergency events. The 

proposed rule would require State DOTs 

to take these evaluations into account in 

their asset management plans for 

facilities that are included in the plans. 

DATES: Comments must be received on 

or before April 21, 2015. Late-filed 

comments will be considered to the 

extent practicable. 

ADDRESSES: To ensure that you do not 

duplicate your docket submissions, 

please submit them by only one of the 

following means: 

• Federal eRulemaking Portal: Go to 

http://www.regulations.gov and follow 

the online instructions for submitting 

comments. 

• Mail: Docket Management Facility, 

U.S. Department of Transportation, 1200 

New Jersey Avenue SE., W12–140, 

Washington, DC 20590–0001. 

• Hand Delivery: West Building 

Ground Floor, Room W12–140, 1200 

New Jersey Avenue SE., between 8:30 

a.m. and 4:00 p.m., e.t., Monday through 

Friday, except Federal holidays. The 

telephone number is 202–366–9329. 

• Instructions: You must include the 

agency name and docket number or the 

Regulatory Identification Number (RIN) 

for the rulemaking at the beginning of 

your comments. All comments received 

will be posted without change to 

http://www.regulations.gov, including 

any personal information provided. 

FOR FURTHER INFORMATION CONTACT: Ms. 

Nastaran Saadatmand, Office of Asset 

Management, 202–366–1336, 

nastaran.saadatmand@dot.gov or Ms. 

Janet Myers, Office of the Chief Counsel, 

202–366–2019, janet.myers@dot.gov, 

Federal Highway Administration, 1200 

New Jersey Avenue SE., Washington, 

DC 20590. Office hours are from 8:00 

a.m. to 4:30 p.m., e.t., Monday through 

Friday, except Federal holidays. 

SUPPLEMENTARY INFORMATION: 

Electronic Access and Filing 

This document and all comments 

received may be viewed online through 

the Federal eRulemaking portal at 

http://www.regulations.gov. Electronic 

submission and retrieval help and 

guidelines are available on the Web site. 

It is available 24 hours each day, 365 

days this year. Please follow the 

instructions. An electronic copy of this 

document may also be downloaded 

from the Office of the Federal Register’s 

home page at https://

www.federalregister.gov. 

Executive Summary 

I. Purpose of the Regulatory Action 

This regulatory action would establish 

a process that States DOTs would use to 

develop a State asset management plan, 

in accordance with section 1106(a) of 

MAP–21, codified as 23 U.S.C. 119. 

Asset management, as defined in 23 

U.S.C. 101(a)(2), is ‘‘a strategic and 

systematic process of operating, 

maintaining, and improving physical 

assets, with a focus on both engineering 

and economic analysis based on quality 

information, to identify a structured 

sequence of maintenance, preservation, 

repair, rehabilitation, and replacement 

actions that will achieve and sustain a 

desired state of good repair over the life 

cycle of the assets at minimum 

practicable cost.’’ Asset management 

plans are an important highway 

infrastructure management tool to 

improve and preserve the condition of 

assets and system performance. Asset 

management plans help agencies answer 

five core questions: 

(1) What is the current status of our 

assets? 

(2) What is the required condition and 

performance of those assets? 

(3) Are there critical risks that must be 

managed? 


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(4) What are the best investment 

options available for managing the 

assets? 

(5) What is the best long-term funding 

strategy? 

The need for effective asset 

management practices nationwide stems 

from a combination of challenges facing 

the State DOTs and FHWA. First, the 

nature of the FAHP has changed over 

the last several decades. Whereas the 

FAHP once primarily funded major 

new-location infrastructure projects, 

today the FAHP primarily focuses on 

preserving existing infrastructure 

through preventative maintenance and 

reconstruction. This work is 

complicated by the variable effects of 

increased usage, infrastructure age, and 

deterioration and damage from 

environmental conditions, including 

extreme weather. Second, funding needs 

for the FAHP far exceed available 

Federal funding. Making sound 

investment decisions is more important 

in an environment of financial scarcity. 

Third, the expectations of Congress and 

the general public have changed since 

the early days of the FAHP. Today, both 

expect highly transparent, accountable, 

data-driven decisionmaking about the 

investment of FAHP funds. The asset 

management requirements of 23 U.S.C. 

119, together with the performance 

measures and targets established under 

23 U.S.C. 150(c) and (d), will create 

national minimum requirements for 

practices that will help State DOTs and 

FHWA address these challenges. 

State DOTs are required to develop 

and implement asset management plans 

for the NHS to improve or preserve the 

condition of the assets and the 

performance of the NHS relating to 

physical assets. 23 U.S.C. 119(e)(1). 

State asset management plans must 

include strategies leading to a program 

of projects that would: (1) Make 

progress toward achievement of the 

State targets for asset condition and 

performance of the NHS in accordance 

with 23 U.S.C. 150(d), and (2) support 

progress toward the achievement of the 

national goals identified in 23 U.S.C. 

150(b). 23 U.S.C. 119(e)(2). 

State DOTs’ asset management plans 

must include a minimum scope (i.e., the 

NHS) and certain minimum contents 

(e.g., a financial plan) (see 23 U.S.C. 

119(e)(4)). However, FHWA encourages 

State DOTs to exceed the minimum plan 

scope and contents because asset 

management plans can help State DOTs 

make better data-driven investment 

decisions on a statewide basis. For 

example, all State DOTs, at a minimum, 

would develop an asset management 

plan for the NHS regardless of 

ownership; but, State DOTs may choose 

to go beyond that minimum and include 

other public roads within their asset 

management plans at their option. Also, 

State DOTs must include, at a 

minimum, a summary listing of the 

pavement and bridge assets on the NHS; 

however, State DOTs would be 

encouraged, but not required, to include 

all highway infrastructure assets within 

the right-of-way (ROW). 

Under the proposed rule, the State 

DOT would be required to include 

measures and targets for all assets 

included in the asset management plan. 

Performance measures can be used for a 

number of purposes in asset 

management. For example, an agency 

may use performance measures to 

evaluate a range of potential solutions to 

a transportation need, to track the 

impacts of investments, and to provide 

accountability to the public. 

Performance measures are an integral 

part of a data-driven, performance-based 

approach to asset management. 

Agencies develop targets related to their 

performance measures to guide their 

resource allocation and program 

delivery. Targets may represent the 

desired future in a relatively long-term 

context, taking into account existing 

baseline conditions, budget constraints, 

and longer-term goals. Alternatively, 

agencies may use targets to measure the 

interim progress on a measure, in a 

relatively short-term context, as 

agencies implement their transportation 

program. For NHS pavement and bridge 

assets, which the State is required to 

include in its asset management plan, 

the State DOT’s plan would include the 

national measures for bridge and 

pavement condition established by 

FHWA (see FHWA’s related NPRM on 

Performance Management Measures for 

Bridges and Pavement, RIN 2125– 

AF53), and the targets the State DOT 

develops for those measures. Those 

measures and targets will be established 

pursuant to requirements under 23 

U.S.C. 150(c) and (d). If a State DOT has 

pre-existing measures and targets for 

pavements and bridges on the NHS and 

wishes to continue to include those in 

its plan as part of its asset management 

effort, it may do so. However, those preexisting measures and targets cannot 

and will not substitute for the national 

measures under 23 U.S.C. 150(c) or the 

required section 150(d) State targets for 

those national measures either in the 

required asset management plan or 

other provisions under title 23. For any 

additional assets the State DOT decides 

to include in its asset management plan, 

the State DOT would develop its own 

measures and targets. 

These proposed regulations would 

ensure that State DOTs establish and 

follow a set of processes to identify the 

investment strategies included in the 

asset management plans. These 

processes relate to performing analyses 

at the program level, including 

performance gap analysis, life-cycle cost 

analysis, and risk analysis. The 

intention is all State DOTs will use asset 

management to undertake a strategic 

and systematic process of effectively 

operating, maintaining, upgrading, and 

expanding physical assets throughout 

their life cycles in order to achieve and 

sustain a desired state of good repair. 

The goal is better decisionmaking that is 

based upon quality information and 

well-defined objectives, and considers 

risks to the assets and system 

performance as part of the 

decisionmaking process. 

In addition to the asset management 

plan process required under 23 U.S.C. 

119(e)(8), this proposed rule addresses 

other requirements established in 23 

U.S.C. 150 and in section 1315(b) of 

MAP–21. This proposed rule would 

define the minimum standards that 

States would use in developing and 

operating highway bridge and pavement 

management systems required under 23 

U.S.C. 150(c)(3)(A)(i). This proposed 

rule would require States to address the 

requirements in MAP–21 section 

1315(b) by conducting evaluations to 

determine if reasonable alternatives 

exist to roads, highways, or bridges that 

repeatedly require repair and 

reconstruction activities from 

emergency events. The proposed rule 

would require States to take these 

evaluations into account in their asset 

management plans to the extent those 

assets are included in the asset 

management plan. 

II. Summary of the Major Provisions of 

the Regulatory Action in Question 

Section 515.001 would clarify that the 

purposes of the proposed rule are to: (1) 

Establish the processes that a State DOT 

would be required to use to develop its 

asset management plan, as required 

under 23 U.S.C. 119(e); (2) establish the 

minimum content requirements that 

apply to the development of an asset 

management plan; (3) set forth the 

minimum standards for a State DOT to 

use in developing and operating bridge 

and pavement management systems as 

required under 23 U.S.C. 150(c)(3)(A)(i); 

(4) describe the statutory penalties for a 

State DOT’s failure to develop and 

implement an asset management plan in 

accordance with 23 U.S.C. 119 and the 

requirements established through this 

rulemaking; and (5) establish the 

requirements for State DOTs to conduct 

periodic evaluations to determine if 

reasonable alternatives exist to roads, 


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1The FHWA interprets ‘‘life-cycle cost analysis,’’ 

as used in 23 U.S.C. 119(e)(4)(D), as intended to be 

consistent with life-cycle planning and life-cycle 

cost analysis as used in asset management. The 

definition proposed in this rulemaking is not 

intended to be the same as the definition in 23 

U.S.C. 106(f), which focuses on life-cycle cost 

analysis in design. 

highways, or bridges that repeatedly 

require repair and reconstruction 

activities due to emergency events. 

Section 515.003 specifies that the 

proposed rule would be applicable to all 

State DOTs. 

Section 515.005 includes definitions 

for certain terms that would be 

applicable to the proposed regulations. 

With respect to the definition of asset 

management, the proposed rule uses the 

definition of this term found at 23 

U.S.C. 101(a)(2). 

Section 515.007 proposes the 

processes that State DOTs would be 

required to use in developing their asset 

management plans. These processes 

align with the minimum content 

elements that the statute (23 U.S.C. 119) 

requires to be included in the asset 

management plan, and also align with 

the contents the proposed rule would 

require in asset management plans 

under section 515.009. These processes 

take a broad look at the NHS as a 

network. 

Under the proposed section 515.007, 

State DOTs would use the following 

processes to develop their asset 

management plans: 

First, each State DOT would be 

required to establish a process for 

conducting a performance gap analysis 

and to identify strategies to close gaps. 

A performance gap analysis identifies 

deficiencies that may be hindering 

achievement of the State DOT’s targets 

for asset condition and the State’s 

desired system performance as it relates 

to physical assets on the NHS. As 

previously indicated, if the State DOT 

chooses to include other public roads or 

assets in the asset management plan, 

then the State DOT would be required 

to conduct a performance gap analysis 

for those other roads and assets as well. 

Second, each State DOT would be 

required to establish a process for 

conducting life-cycle cost analysis for 

an asset class or asset sub-groups at the 

network level. Life cycle cost analysis is 

used to develop a strategic treatment 

plan for the whole life of assets. The 

strategic treatment plan considers 

application of all possible treatments 

during the asset’s life (i.e. preservation, 

rehabilitation, and reconstruction along 

with routine and corrective 

maintenance). This strategic treatment 

plan is used not only to make the assets 

serviceable, but to extend the service 

life of assets beyond their design life. 

This approach produces cost savings, a 

benefit of asset management. For 

purposes of this rule, ‘‘life-cycle cost 

analysis’’ would be defined as the cost 

of managing an asset class or asset subgroup for its whole life, from initial 

construction to the end of its service 

life.1 A ‘‘life-cycle cost analysis’’ would 

mean a process to estimate the cost of 

managing an asset class, or asset subgroup over its whole life with 

consideration for minimizing cost while 

preserving or improving the condition. 

Third, to ensure the asset 

management plan is risk-based, as 

required by 23 U.S.C. 119(e)(1), each 

State DOT would be required to 

establish a process for undertaking a 

risk management analysis for assets in 

the plan. As part of this process, State 

DOTs would identify and assess risks 

(e.g., extreme weather) that can affect 

asset condition or the effectiveness of 

the NHS as it relates to physical assets. 

The process for risk management 

analysis would have to include 

addressing the risks to assets and to the 

highway system associated with current 

and future environmental conditions, 

including extreme weather events, 

climate change, and seismic activity, in 

order to provide information for 

decisions about how to minimize their 

impacts and increase asset and system 

resiliency. The process for risk 

management analysis also would be 

required to take into account, for assets 

in the plan, the results of the State 

DOT’s evaluation of roads, highways, 

and bridges that have repeatedly 

required repair or reconstruction due to 

emergency events, as proposed in 

section 515.019 of this rule. For assets 

in the asset management plan, State 

DOTs would be required to develop an 

approach to address and monitor highpriority risks to assets and the 

performance of the system. 

Fourth, each State DOT would be 

required to establish a process for 

developing a financial plan covering a 

10-year period. The process would 

include a method to determine 

estimated costs of expected future work 

and estimated available funding. 

Fifth, each State DOT would be 

required to establish a process for 

developing investment strategies to 

improve or preserve the condition of the 

assets and the performance of the NHS, 

and leading to a program of projects that 

would make progress toward 

achievement of the State targets for asset 

condition and performance of the NHS 

established pursuant to 23 U.S.C. 150(d) 

and supporting the progress toward 

achievement of the national goals 

identified in 23 U.S.C. 150(b). 23 U.S.C. 

119(e)(1)–(2). 

Finally, each State DOT would be 

required to use pavement and bridge 

management systems to analyze the 

condition of Interstate highway 

pavements, non-Interstate NHS 

pavements and NHS bridges, and to 

determine optimal management and 

investment strategies. Pavement and 

bridge management systems can support 

an agency’s asset management practices 

by supporting the development of 

strategic performance objectives for the 

pavement and bridge assets and related 

highway systems. There are three major 

components to pavement and bridge 

management systems. Those are a 

system to regularly collect condition 

data; a computer database to sort and 

store the data; and an analysis program 

to evaluate repair, preservation, 

maintenance, and other management 

strategies and identify cost effective 

project options. State DOTs typically 

use commercially available software for 

the database and analysis components. 

State DOTs will be required to operate 

these systems under 23 U.S.C. 

150(c)(3)(A)(i). The FHWA also 

proposes the minimum standards each 

State DOT would need to meet in 

developing these management systems. 

These minimum standards would 

govern collecting, processing, storing, 

and updating data; forecasting 

deterioration; comparing cost benefit for 

alternative work types; identifying short 

and long range budget needs; 

determining optimal strategies on 

identified potential projects to manage 

pavements and bridges; and 

recommending programs and schedules 

for implementation. 

Section 515.009 proposes the 

minimum content requirements that 

would be applicable to State DOT asset 

management plans. The proposed 

content of the plans, described below, 

would be derived largely from the 

application of the processes FHWA 

proposes under section 515.007. 

First, this section of the proposed rule 

would describe the requirement for the 

State DOT to develop and implement an 

asset management plan to achieve and 

sustain a state of good repair over the 

life cycle of the assets, and to improve 

or preserve the condition of the NHS in 

accordance with 23 U.S.C. 119(e)(1)–(2). 

Pursuant to 23 U.S.C. 119(e)(4)(A), the 

State DOT would be required to include 

NHS highway pavements and bridges 

regardless of the ownership of the 

relevant NHS facility. The State DOT 

would be encouraged, but not required, 

to include in its asset management plan 

all other highway infrastructure assets 

within the NHS ROW, as well as 


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9234 Federal Register / Vol. 80, No. 34 / Friday, February 20, 2015 / Proposed Rules 

2The proposed rule, ‘‘National Performance 

Management Measures; Assessing Pavement 

Condition for the National Highway Performance 

Program and Bridge Condition for the National 

Highway Performance Program’’ (RIN 2125–AF53), 

is available on the docket for review. 

highway infrastructure assets from other 

public roads. 

Second, each State DOT would be 

required, at a minimum, to include the 

following information in its asset 

management plan: 

• Asset management objectives, 

which should align with the agency’s 

mission. The objectives must be 

consistent with the purpose of asset 

management, which is to achieve and 

sustain a desired state of good repair 

over the life cycle of the assets at a 

minimum practicable cost. 

• Measures and targets designed to 

achieve and sustain a desired state of 

good repair over the life cycle of the 

assets at minimum practicable cost. This 

would include, at a minimum, the 

national measures that address the 

condition of pavements on the Interstate 

System, the condition of pavements on 

the NHS (excluding the Interstate), and 

the condition of bridges on the NHS. 

The FHWA will establish the national 

measures, pursuant to 23 U.S.C. 

150(c)(3)(A)(ii)(I)–(III), in new 

regulations at 23 CFR part 490.2 The 

State DOT also must include the targets 

the State DOT establishes pursuant to 23 

U.S.C. 150(d) for the required national 

measures (State DOTs would report on 

the required targets as provided in 23 

CFR part 490, once promulgated). Under 

the proposed rule, the State DOT would 

have the option of including other NHS 

assets and non-NHS assets in its plan. 

If the State does so, it would have to 

establish measures and targets for those 

assets. In addition, the State DOT may 

use other measures and targets for NHS 

pavements and bridges that the State 

DOT has established through preexisting or new asset management 

efforts. However, such other measures 

and targets for pavements and bridges 

on the NHS cannot and will not 

substitute for the required national 

measures and related State targets either 

in the required asset management plan 

or under other provisions of title 23. All 

requirements of this part would apply to 

all assets, measures, and targets in a 

State DOT’s asset management plan. 

• A summary listing of the pavement 

and bridge assets on the NHS, including 

at a minimum a description of the 

condition of those assets for: Interstate 

pavement, non-Interstate NHS 

pavement, and NHS bridge assets. The 

FHWA proposes that each State DOT 

use these three categories in order to be 

consistent with the categories of 

performance measures that would be 

established under 23 U.S.C. 

150(c)(3)(A)(ii). These requirements 

would apply regardless of what entity 

owns the NHS asset. 

• Performance gap identification 

developed using the process the State 

DOT adopts pursuant to section 

515.007. 

• Life-cycle cost analysis developed 

using the process the State DOT adopts 

pursuant to section 515.007. 

• Risk management analysis for assets 

and the highway network included in 

the plan, and including for those assets 

a summary of the results of the MAP– 

21 section 1315(b) statewide periodic 

evaluations; financial plan; and 

investment strategies. This analysis is 

developed using the process the State 

DOT adopts pursuant to section 

515.007. 

Third, asset management plans would 

be required to cover a minimum 10-year 

period. The FHWA proposes this time 

period because MAP–21 calls for asset 

management plans to evaluate 

investment options on a life-cycle basis. 

If the time period covered by the plan 

is too short, it likely will result in the 

adoption of short-term solutions that 

may not be truly cost-effective. If the 

time period is too long, the State DOT 

may have little certainty about financial 

resources available in the later years of 

the plan. This would hinder the 

usefulness of the plan as a realistic 

guide for investment decisions. The 

proposed 10-year period is consistent 

with feedback received during the 

outreach activities carried out in 

anticipation of this rulemaking. 

Fourth, each State DOT would be 

required to discuss in its asset 

management plan a set of investment 

strategies leading to an immediate 

program of projects, as described in 23 

U.S.C. 119(e)(2). The State DOT should 

include projects consistent with its 

investment strategies in its Statewide 

Transportation Improvement Program 

(STIP), and select projects from the STIP 

to support its efforts to achieve the 

State’s targets for asset condition and 

performance of the NHS. 

Finally, FHWA proposes to require 

each State DOT to make its asset 

management plan available to the 

public, and encourages the State DOTs 

to do so in a format that is easily 

accessible. 

Section 515.011 proposes a process 

that would enable a State DOT to phase 

in the development of its asset 

management plan. The FHWA 

recognizes that a phase-in approach 

would help give State DOTs adequate 

time to develop and apply the analytical 

processes required under proposed 

section 515.007. The phase-in approach 

also takes into consideration the likely 

timing of the performance management 

rulemaking proceedings for pavement 

and bridge conditions under 23 U.S.C. 

150 (RIN 2125–AF53). The proposed 

phase-in would permit a State DOT to 

submit its initial asset management plan 

using best available information in each 

required analysis area, omit certain 

analyses, and exclude the 23 U.S.C. 

150(c) measures and the related State 

DOT section 150(d) targets. However, 

the State DOT would be required to 

include in its initial plan a description 

of the asset management plan 

development processes the State DOT 

proposes to use pursuant to section 

515.007. Inclusion of the proposed 

processes in the initial plan will permit 

FHWA to use the initial plan to review 

and certify the State DOT’s processes as 

required by 23 U.S.C. 119(e)(6). The 

proposed rule also would require the 

State DOT to include in its initial plan 

its own measures and targets for assets 

covered by the plan. Under the 

proposed rule, not later than 18 months 

after the effective date of the final 

rulemaking for pavement and bridge 

condition measures pursuant to 23 

U.S.C. 150, State DOTs would have to 

amend their asset management plans to 

incorporate complete analyses carried 

out using certified processes and the 

section 150 measures and targets. Under 

the proposed rule, FHWA could extend 

the 18-month deadline for submitting an 

amended plan as needed to provide 12 

months between the time FHWA 

certifies the State DOT’s processes 

under 23 U.S.C. 119(e)(6)(A) and the 

date the amended plan is due. The 

FHWA could grant the extension only if 

it determines the State DOT’s initial 

plan meets the requirements of 

proposed section 515.011. 

Section 515.013 proposes the process 

by which a State DOT would submit its 

asset management plan development 

processes to FHWA for certification 

pursuant to 23 U.S.C. 119(e)(6), and its 

asset management plan for an FHWA 

consistency determination under 

section 119(e)(5). 

Section 515.015 discusses the 

penalties for a State DOT that does not 

develop and implement an asset 

management plan consistent with 23 

U.S.C. 119 and the requirements of this 

proposed rule. 

Section 515.017 describes how a State 

DOT may integrate asset management 

into its organizational mission, culture, 

and capabilities at all levels. 

Section 515.019 proposes that the 

State DOT conduct a periodic statewide 

evaluation not less than every 4 years of 

the State’s existing roads, highways, and 


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3There are currently four States that don’t 

currently have pavement and bridge management 

systems that meet the standards of the proposed 

rule. 

4Smadi, Omar, Quantifying the Benefits of 

Pavement Management, a paper from the 6th 

International Conference on Managing Pavements, 

2004. 

bridges that required repair and 

reconstruction activities due to 

emergency events. The purpose is to 

determine if there are reasonable 

alternatives to any of these roads, 

highways, and bridges as required under 

section 1315(b) of MAP–21. The 

proposed rule would require State DOTs 

to complete the evaluation for assets 

included in the asset management plan 

not later than 2 years after the issuance 

of a final rule. The State DOT would be 

required to complete the evaluation of 

the rest of the affected roads, highways, 

and bridges in the State within 4 years 

of the final rule. For facilities that are 

included in the asset management plan, 

State DOTs would need to include a 

summary of the results and consider the 

results of these evaluations in their risk 

management analyses included in the 

plan. 

III. Costs and Benefits 

The costs and benefits were estimated 

for implementing the requirement for 

States to develop a risk-based asset 

management plan and to use pavement 

and bridge management systems that 

comply with the minimum standards 

proposed by this NPRM. 

Based on information obtained from 

nine State DOTs, the total nationwide 

costs for all States to develop their asset 

management plans and for four States 3

to acquire and install pavement and 

bridge management systems would be 

$43.2 million discounted at 3 percent 

and $36.7 million discounted at 7 

percent. 

The FHWA lacks data on the 

economic benefits of the practice of 

asset management as a whole. The field 

of asset management has only become 

common in the past decade and case 

studies of economic benefits from 

overall asset management have not been 

published. We specifically request that 

commenters submit data on the 

quantitative benefits of asset 

management and reference any studies 

focusing on the economic benefits of 

overall asset management. 

While FHWA lacks data on the overall 

benefits of asset management, there are 

examples of the economic savings that 

result from the most typical component 

sub-sets of asset management, pavement 

and bridge management systems. Using 

an Iowa DOT study 4 as an example of 

the potential benefits of applying a longterm asset management approach using 

a pavement management system, the 

costs of developing the asset 

management plans and acquiring 

pavement management systems were 

compared to determine if the benefits of 

the proposed rule would exceed the 

costs. The FHWA estimates the total 

benefits for the 50 States, the District of 

Columbia, and Puerto Rico of utilizing 

pavement management systems and 

developing asset management plans to 

be $453.5 million discounted at 3 

percent and $340.6 million discounted 

at 7 percent. 

Based on the benefits derived from 

the Iowa DOT study and the estimated 

costs of asset management plans and 

acquiring pavement management 

systems, the ratio of benefits to costs 

would be 10.5 at a 3 percent discount 

rate and 9.3 at a 7 percent discount rate. 

The estimated benefits do not include 

the potential benefits resulting from 

savings in bridge programs. The benefits 

for States already practicing good asset 

management decisionmaking using their 

pavement management systems will be 

lower, as will the costs. If the 

requirement to develop asset 

management plans only marginally 

influences decisions on how to manage 

the assets, benefits are expected to 

exceed costs. The FHWA requests 

comments on these estimates. 

Discounted at 

3 percent 

Discounted at 

7 percent 

Total Benefits for 52 States ......................................................................................................................... $453,517,289 $340,580,916 

Total Cost for 52 States .............................................................................................................................. $43,159,635 $36,701,377 

Benefit Cost Ratio ........................................................................................................................................ 10.5 9.3 

Background 

Asset Management in General 

Historically, construction and 

expansion of roads, bridges, and other 

transportation infrastructure in the 

United States have been a central focus 

of transportation agencies. Highway 

infrastructure development peaked with 

the construction of the Interstate 

Highway System. Today, significant 

portions of our highway assets are 

deteriorating because of increased 

usage, environmental impacts, and 

aging. As a result, it is becoming 

increasingly necessary to focus on 

meeting the demands of maintenance, 

preservation, and reconstruction of 

existing infrastructure. As State DOTs 

and other public sector owners of 

highway infrastructure are faced with 

increased system and budgetary needs 

at a time when resources are limited, 

asset management is critical now more 

than ever. 

In recent years, most transportation 

agencies have experienced reduced 

funding coupled with a loss of 

purchasing power. In addition, the fact 

that the transportation system is aging 

and becoming more costly to maintain 

has become a great concern. Federal, 

State, and local governments are under 

increasing pressure to balance their 

budgets and, at the same time, respond 

to public demands for quality services. 

Along with the need to invest in 

America’s future, this leaves 

transportation agencies with the task of 

managing the current transportation 

systems as cost-effectively as possible, 

while managing potential risks to 

system performance. 

The Asset Management Plan 

requirement included in MAP–21 is in 

line with international best practices 

that were initiated abroad as the public 

sector in many countries experienced a 

reduction in resources available to 

maintain their assets in a state-of-goodrepair. States in the U.S. have 

incorporated some elements of the asset 

management framework. However, 

despite the obvious benefits stemming 

from the use of an asset management 

framework, it has not yet been adopted 

by all States. The FHWA believes the 

disconnect results from States’ current 

practices. As an example, in many State 

DOTs the pavement management 

analysis is done at the State DOT’s 

central office. The output is then 

forwarded to the district/regional offices 

that make the final decisions and have 

a lot of flexibility in what projects to 

take on. As a result, the projects are 

selected by field personnel whose 

expertise is in addressing immediate 

needs. The concept of project selection 


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based on an asset life cycle is unknown 

to many of them. Another major factor 

that results in some district/regional 

offices deviating from the 

recommendations made by the 

pavement management system is the 

lack of confidence in the quality of 

pavement data used in the analysis. An 

additional issue is the general resistance 

to changing from a worst-first approach 

to a life-cycle cost approach. Asset 

management is a business process and 

a decisionmaking framework for 

achieving and sustaining a desired state 

of good repair over the life cycle of the 

assets at minimum practicable cost. 

Asset management uses an extended 

time horizon, draws from economics, as 

well as engineering analyses, and 

considers a broad range of assets. An 

asset management approach also 

incorporates the economic assessment 

of trade-offs between alternative 

investment options, both at the project 

level and at the network or system level, 

and helps transportation agencies make 

cost-effective investment decisions. In 

addition, asset management helps 

ensure that the transportation system is 

financially sustainable. Asset 

management increases infrastructure 

resiliency against natural hazards (such 

as extreme weather events or seismic 

activities) and reduces or eliminates the 

impacts of potential threats to asset and 

system performance. A key feature of 

asset management is that it requires a 

statement of explicit, clearly defined 

goals that reflect customer expectations 

and considerations unique to each State 

DOT. These goals often address system 

performance and condition targets 

designed to achieve a state of good 

repair. 

All State DOTs currently manage their 

transportation network along with its 

assets; however, few apply risk-based 

asset management principles in their 

investment decisionmaking processes. 

For example, although most States 

conduct risk analyses at the project 

level, risk assessment and management 

at the program level is often a missing 

component of current management 

practices. Congress has recognized the 

importance of risk analysis in asset 

management by expressly requiring the 

State asset management plan to be riskbased. 23 U.S.C. 119(e)(1). State DOTs 

must carefully analyze the impact on 

the long-term performance of the 

highway network when making 

decisions regarding funding 

distribution, especially when funding is 

reduced for one program and diverted to 

meet the pressing needs of another 

program. The impact of these tradeoffs 

could become very costly if appropriate 

analyses are not conducted prior to 

decisionmaking. 

Although risk-based asset 

management is a relatively new concept 

to transportation agencies, most State 

DOTs have many of the elements 

necessary to initiate asset management, 

including pavement and bridge 

management systems that monitor 

conditions, measure performance, 

predict trends, and recommend 

candidate projects and preservation 

treatments. Asset management brings a 

particular perspective to how an agency 

conducts its existing planning and 

programming procedures and reaches 

decisions. It suggests principles and 

techniques to apply in policymaking, 

planning, project selection, program 

tradeoffs, program delivery, data 

gathering, and management system 

application. Most importantly, it uses an 

effective communication tool—the asset 

management plan—to document how 

decisions regarding investment 

strategies are made, what actions are 

taken to improve or preserve the 

condition of the assets and system 

performance, how risks to system 

performance are managed, and how the 

costs of maintaining assets throughout 

their lives are considered. For State 

DOTs, development of a risk-based asset 

management plan will facilitate the 

communication between 

decisionmakers and stakeholders and 

assure the public that appropriate steps 

are taken when making transportation 

investment decisions. 

DOT Outreach Efforts 

In developing these proposed 

regulations, FHWA conducted Web 

conferences, face-to-face meetings, made 

presentations at national conferences, 

and held teleconferences with 

stakeholders, including State DOTs. 

These sessions were intended to provide 

opportunities for stakeholders to discuss 

experiences, potential strategies for 

developing and implementing riskbased asset management within the 

context of MAP–21, and concerns with 

the MAP–21 asset management 

requirements. In general, these 

consultations included: 

—Web conference on September 28, 

2012, with the American Association 

of State Highway and Transportation 

Officials (AASHTO) Subcommittee on 

Asset Management; 

—Web conference on October 17, 2012, 

with representatives from the 

AASHTO Standing Committee on 

Planning and representatives from the 

Standing Committee on Highways; 

—Face-to-face meeting in Pittsburgh, PA 

on November 17, 2012, with the 

AASHTO Subcommittee on Asset 

Management; 

—Web conference on October 25, 2012, 

with the Asset Management Expert 

Task Group; and 

—Presentations that included 

information on the MAP–21 Asset 

Management requirements were held 

at the following events: 

Æ National Pavement Preservation 

Conference, Nashville, TN, August 

2012; 

Æ International Forum on Traffic 

Records, Biloxi, MS, October 2012; 

and 

Æ Transportation Research Board 

Meeting, Bridge Management 

Committee, January 2013. 

At each of these outreach sessions, 

some participants expressed that States 

be provided with flexibility in the 

development of their asset management 

plans so that they can properly address 

any issues that are unique to their State. 

The burden associated with developing 

a risk-based asset management plan 

(e.g., potential organizational 

restructuring, modification of 

decisionmaking processes, 

documentation of processes, and 

increases in staffing) was another 

concern. In addition, there were 

questions about the inclusion or 

exclusion of highways that are on the 

NHS, but maintained by municipalities 

or turnpike authorities. 

General Discussion of the Proposal 

This proposal is intended to 

implement 23 U.S.C. 119(e)(8), which 

requires the Secretary to establish, by 

regulation, the process States must use 

to develop their asset management 

plans. The proposed regulations would 

ensure that State DOTs follow a set of 

processes to identify the investment 

strategies included in the asset 

management plan. These processes 

relate to performing analyses at the 

program level including performance 

gap analysis, life-cycle cost analysis, 

and risk analysis. The intention is that 

investment strategies included in the 

asset management plans are developed 

based on a thorough assessment of the 

NHS infrastructure operation, 

preservation, and improvement needs, 

while minimizing the whole life costs of 

assets and understanding the potential 

risks to system performance. While the 

best practice is to perform inclusive gap 

and risk analyses encompassing all the 

national performance goal areas for the 

NHS (see 23 U.S.C. 150(b)), for the 

purpose of asset management plan 

development pursuant to 23 U.S.C. 119, 

the focus of these analyses should be on 

determining deficiencies and risks to 

physical asset conditions and system 


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5 In addition to these national measures for 

pavement and bridge conditions under section 

150(c)(3)(ii)(I)–(III), FHWA will establish 

performance measures for the performance of the 

Interstate System and the performance of the NHS 

(excluding the Interstate System) as required by 23 

U.S.C. 150(c)(3)(ii)(IV)–(V). The FHWA will 

propose the national measures as part of separate 

rulemakings pursuant to section 150 (RIN 2125– 

AF54 and RIN 2125–AF53). 

performance as it relates to physical 

assets. 

Link to Performance Management 

The overarching purpose of asset 

management is to achieve a desired state 

of good repair over the life cycle of 

assets at a minimum practicable cost. 

Development and implementation of a 

State asset management plan for NHS 

pavements and bridges is an important 

part of NHS performance management 

as envisioned in MAP–21. In 23 U.S.C. 

119(e)(2), Congress provides that a State 

asset management plan shall include 

strategies leading to a program of 

projects that would make progress 

toward achievement of the State targets 

for asset condition and performance of 

the NHS in accordance with 23 U.S.C. 

150(d), and supporting the progress 

toward the achievement of the national 

goals identified in 23 U.S.C. 150(b). 

Section 119(b)(3) specifies that the 

purpose of the National Highway 

Performance Program (NHPP) ‘‘. . . 

shall be . . . to ensure that investments 

of Federal-aid funds in highway 

construction are directed to support 

progress toward the achievement of 

performance targets established in an 

asset management plan of a State for the 

National Highway System.’’ 

Accordingly, the asset management plan 

developed pursuant to 23 U.S.C. 119(e) 

will serve as both a resource and a ‘‘road 

map’’ for the State’s efforts to achieve 

and sustain a state of good repair over 

the life cycle of the assets, and to make 

progress toward those national goals 

and the State’s targets for pavement and 

bridge condition established pursuant to 

23 U.S.C. 150.5

The FHWA recognizes that many 

State DOTs already use management 

systems as a critical element in their 

investment decisionmaking process. 

Those systems have been developed and 

refined, in many cases over a long 

period of time, through the State DOT’s 

continuing evaluation of the 

effectiveness of investment strategies in 

improving infrastructure conditions. 

The FHWA also recognizes that the 

measures used in these legacy systems 

for pavement and bridge conditions may 

not be identical to the national measures 

FHWA establishes under 23 U.S.C. 

150(c). Considering this possibility, 

FHWA expects State DOTs will choose, 

and in some cases may be required by 

State law, to continue to use their legacy 

systems to assess infrastructure 

conditions and to develop strategies that 

will drive their investment 

decisionmaking. Accordingly, FHWA is 

proposing to permit State DOTs to 

include their pre-existing measures and 

targets for NHS pavement and bridge 

condition and performance in their 

plans even after the section 150 

measures and targets are established, so 

long as those non-section 150 measures 

and targets are treated as supplemental 

to the section 150 measures and targets. 

Non-section 150 measures and targets 

cannot substitute for section 150 

national measures and associated State 

DOT targets under 23 U.S.C. 150(d). The 

State DOTs will be held accountable for 

including section 150 measures and 

targets in their plans and meeting title 

23 requirements relating to those section 

150 measures and targets. However, a 

State DOT asset management plan’s 

investment strategies may be influenced 

by both the section 150 measures and 

targets and any other measures and 

targets the State DOT includes in its 

asset management plan. 

The FHWA expects State DOTs with 

legacy systems will make the changes 

needed to fully use and support the new 

national measures and targets once 

established pursuant to 23 U.S.C. 150. 

The FHWA understands and appreciates 

the amount of work required to make 

these changes. The FHWA is committed 

to providing technical assistance to 

State DOTs as they work to improve 

their ability to reliably predict how their 

investments can lead to pavement and 

bridge condition improvements as 

defined using the new national 

measures. 

Implementation 

The FHWA is proposing special 

phase-in provisions as a part of this 

rulemaking. The proposed rule would 

provide a phase-in for both the asset 

management plans and the MAP–21 

section 1315(b) evaluations of roads, 

highways, and bridges that repeatedly 

required repair and reconstruction 

activities. As the expected timelines for 

completing this rulemaking and the 23 

U.S.C. 150 rulemaking become more 

certain, FHWA will be able to better 

predict how the timing of each 

rulemaking affects the other. The FHWA 

may revise the proposed phase-in 

approaches to address any timing or 

other issues resulting from the ultimate 

timelines and requirements in final 

rules implementing sections 119 and 

150. 

The proposed phase-in for section 119 

asset management plans would permit a 

State DOT to submit its initial asset 

management plan using best available 

information for each required plan 

element, and to omit certain analyses. In 

addition, the State DOT would be 

permitted to submit its initial plan 

without the 23 U.S.C. 150 measures and 

targets unless the State DOT had 

established its section 150(d) targets for 

pavement and bridge conditions at least 

6 months before the section 515.013(a) 

deadline in this proposed rule for 

submitting the initial asset management 

plan. The State DOT’s initial asset 

management plan would have to 

include its proposed processes for each 

required area of analysis in proposed 

section 515.007, and otherwise meet the 

requirements in proposed section 

515.009, including the identification of 

investment strategies that support 

progress toward the national goals in 23 

U.S.C. 150(b). 

Not later than 18 months after the 

effective date of the final rulemaking for 

pavement and bridge condition 

measures pursuant to 23 U.S.C. 150, a 

State DOT that used the phase-in option 

for its initial plan submission would be 

required to submit an amended plan 

that includes all section 515.007 

analyses performed using FHWAcertified processes. That amended plan 

also would have to include the State 

DOT’s section 150 measures and targets 

for NHS pavements and bridges. Under 

the proposed rule, FHWA could extend 

the 18-month time period as needed to 

provide 12 months between the time 

FHWA certifies the State DOT’s 

processes under 23 U.S.C. 119(e)(6)(A) 

and the date the amended plan is due. 

The FHWA could grant the extension 

only if it determines the State DOT’s 

initial plan meets the requirements of 

section 515.011 of this proposed rule. 

The FHWA considered a number of 

factors in developing the phase-in 

proposal for asset management plans. 

First, the proposal responds to the 

challenges some State DOTs will face in 

developing and applying the processes 

described in proposed section 515.007. 

Both State DOTs with legacy asset 

management planning systems and State 

DOTs new to asset management may 

face time and resource challenges due to 

the need to develop and apply new or 

modified processes. 

Second, the phase-in approach is 

needed to address timing and 

coordination issues inherent in the 

process certification and consistency 

determination provisions of 23 U.S.C. 

119. With respect to process 

certification, FHWA proposes to use the 

State DOT’s initial asset management 

plan as the basis for the certification of 

the State DOT’s asset management plan 


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development processes under section 

119(e)(6)(A). Permitting State DOTs to 

submit their initial asset management 

plans using best available information 

for each required plan element would 

allow State DOTs to obtain FHWAcertification of their plan development 

processes before they undertake 

analyses using the processes. 

There also is a potential 

implementation issue with regard to 

FHWA consistency determinations 

under 23 U.S.C. 119(e)(5). The issue 

relates to the availability of the 23 

U.S.C. 150 national performance 

measures and the related targets that 

State DOTs must include in their asset 

management plans. Investment 

strategies in an asset management plan, 

and the underlying analytical work such 

as performance gap analysis, are highly 

affected by the selected performance 

targets. There is a substantial probability 

that the FHWA performance 

management rulemaking under 23 

U.S.C. 150, and the subsequent State 

DOT target-setting under section 

150(d)(1), will not be completed in time 

for the State DOTs to include their 

section 150(d) targets in a fully 

developed asset management plan prior 

to the first required FHWA consistency 

determination. The first determination 

is required for the second fiscal year 

after this rule is final. Absent this 

consistency determination, the Federal 

share on the State DOT’s NHPP projects 

would be reduced to 65 percent. The 

consistency determination also 

demonstrates the State DOT has an 

‘‘approved plan’’ under the NHPP 

obligation transition provision in MAP– 

21 section 1106(b). 

The phase-in proposal would permit 

FHWA to determine the State DOT’s 

initial plan is consistent with 23 U.S.C. 

119 and the final rule if it satisfies the 

plan requirements in proposed section 

515.011. The State DOTs would have up 

to 18 months after the effective date of 

the final rulemaking for pavement and 

bridge condition measures pursuant to 

23 U.S.C. 150 to amend their asset 

management plans to include the 

section 150 measures and the targets the 

State DOTs establish for those measures, 

and to include analyses prepared using 

FHWA-certified processes. The FHWA 

could extend the amendment deadline 

for up to 12 months to ensure the State 

DOT has a reasonable amount of time 

after FHWA certifies the State DOT’s 

processes to complete the required 

analyses and incorporate the section 150 

measures and targets into its plan. This 

18-month period is consistent with the 

18-month deadline in the MAP–21 

section 1106(b)(1) transition provision 

governing obligations of NHPP funds in 

the absence of an approved asset 

management plan and 23 U.S.C. 150(d) 

targets. The extension proposal is 

consistent with the transition 

provision’s extension authority in 

MAP–21 section 1106(b)(2). 

It may be helpful to give an example 

to illustrate how the timing of the 

proposed asset management plan phasein would work. If the final rule on asset 

management were issued on January 15, 

2015, then— 

(1) State DOTs would have to submit 

their initial asset management plans not 

later than January 15, 2016. 

(2) Not later than April 14, 2016, the 

FHWA would notify a State DOT 

whether FHWA certifies the State DOT’s 

processes. 

(3) The reduced Federal share 

provision would be effective on October 

1, 2016 (beginning of the second fiscal 

year after the rule is final), so the first 

consistency review required under 23 

U.S.C. 119(e)(2) would occur on August 

31, 2016. Unless the State DOT 

submitted an amended plan prior to that 

date, FHWA would base the first 

consistency determination on the State 

DOT’s initial asset management plan. 

(4) If the State DOT used the phasein provision proposed in section 

515.011 to submit an initial plan, the 

State DOT would be required to submit 

a plan with all required analyses and 

other elements, including 23 U.S.C. 150 

measures and targets for pavement and 

bridges not later than 18 months after 

the effective date of the final rulemaking 

for pavement and bridge condition 

measures pursuant to 23 U.S.C. 150. The 

FHWA could extend the 18-month time 

period as needed to provide 12 months 

between the time FHWA certifies the 

State DOT’s processes under 23 U.S.C. 

119(e)(6)(A) and the date the amended 

plan is due. The FHWA could grant the 

extension only if it determines the State 

DOT’s initial plan meets the 

requirements of proposed section 

515.011. Thus, if the effective date of 

the section 150 rule on pavement and 

bridge measures is April 15, 2015, the 

18-month period would end on October 

15, 2016. However, under this timing 

example, if the certification of the State 

DOT’s processes occurred on April 14, 

2016, and the State DOT’s initial plan 

met section 515.011 requirements, 

FHWA could extend the due date for an 

amended plan to April 14, 2017, to 

permit the State DOT to incorporate 

section 150 measures and targets and 

complete the required analyses using 

FHWA-certified processes. 

For the section 1315(b) evaluation, 

FHWA proposes a phase in that would 

require State DOTs to complete the 

evaluation of assets included in the 

State DOT’s asset management plan 

within 2 years after the effective date of 

a final rule. The State DOT would have 

to complete the evaluation for the rest 

of the affects roads, highways, and 

bridges not later than 4 years after the 

effective date of the final rule. This 

phase-in approach would permit State 

DOTs to focus their resources first on 

completing the section 1315(b) 

evaluation for assets they include in 

their asset management plans. The 

FHWA believes this approach is 

consistent with the emphasis Congress 

placed on the condition and 

performance of the NHS in MAP–21. 

The FHWA specifically requests 

comments on whether these proposed 

phase-in approaches are desirable and 

workable. 

Section-by-Section Discussion of the 

Proposal 

Section 515.001 Purpose 

This section is included to clarify that 

the purpose of the proposed regulations 

is to: (1) Establish the processes that a 

State DOT would use to develop its 

asset management plan, as required 

under 23 U.S.C. 119(e)(8); (2) establish 

the minimum content requirements that 

would apply to the development of an 

asset management plan; (3) set forth the 

minimum standards a State DOT would 

use in developing and operating bridge 

and pavement management systems as 

required under 23 U.S.C. 150(c)(3)(A)(i); 

(4) describe the statutory penalties for a 

State DOT’s failure to develop and 

implement an asset management plan in 

accordance with 23 U.S.C. 119 and the 

requirements established by this 

rulemaking; and (5) establish that State 

DOTs would be required to conduct 

periodic statewide evaluations to 

determine if reasonable alternatives 

exist to roads, highways, or bridges that 

repeatedly require repair and 

reconstruction activities due to 

emergency events. 

Section 515.003 Applicability 

This section establishes that the 

proposed regulations would be 

applicable to all State DOTs. 

Section 515.005 Definitions 

This section includes proposed 

definitions for certain terms that are 

applicable to the proposed regulations. 

The terms the FHWA defines in this 

section are terms that FHWA believes 

need a common understanding for the 

effective implementation of the 

regulations. The FHWA invites 

comments on these proposed definitions 

and suggestions for any additional terms 

that should be defined. 


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6The related rule, ‘‘National Performance 

Management Measures; Assessing Pavement 

Condition for the National Highway Performance 

Program and Bridge Condition for the National 

Highway Performance Program’’ (RIN 2125–AF53), 

is available on the docket for review. 

First, the FHWA proposes to define 

the term asset to make clear what items 

are subject to an asset management plan. 

The FHWA proposes that it mean all 

physical highway infrastructure (e.g., 

pavements, highway bridges, tunnels) 

located within the ROW corridor of a 

highway. 

Second, the FHWA proposes to define 

the terms asset condition and 

performance of the NHS in order to help 

distinguish the concept of performance 

as used in this rulemaking from the 

concept used in 23 U.S.C. 

150(c)(3)(ii)(IV)–(V). Note that 23 U.S.C. 

119(e)(2) provides that State asset 

management plans shall include 

strategies leading to a program of 

projects that would make progress 

toward achievement of the State targets 

for asset condition and performance of 

the NHS in accordance with 23 U.S.C. 

150(d). It is the FHWA’s intent that, for 

purposes of this proposed rule, the term 

condition refers to the physical 

condition of assets; whereas, the term 

performance refers to the effectiveness 

of the NHS in providing for the safe and 

efficient movement of people and goods 

where it can be affected by physical 

assets. Within this context, examples of 

improving the NHS performance may 

include, but are not limited to, widening 

along a portion of the NHS to alleviate 

congestion, improving drainage on 

another portion of the NHS to address 

safety concerns during rain storms, or 

seismic retrofitting bridges in areas 

prone to earthquakes to increase system 

resilience. The term performance for 

purposes of this rule is not intended to 

define performance for purposes of 23 

U.S.C. 150, which will be defined in the 

related rule implementing that 

provision.6

Third, the FHWA proposes to define 

the term asset management as it is in 23 

U.S.C. 101(a)(2). Under 23 U.S.C. 

101(a)(2), asset management means a 

strategic and systematic process of 

operating, maintaining, and improving 

physical assets, with a focus on both 

engineering and economic analysis 

based upon quality information, to 

identify a structured sequence of 

maintenance, preservation, repair, 

rehabilitation, and replacement actions 

that will achieve and sustain a desired 

state of good repair over the life cycle 

of the assets at minimum practicable 

cost. For purposes of asset management, 

the FHWA interprets replacement 

activities to include initial construction, 

reconstruction, resurfacing, and upgrade 

activities. 

Fourth, the FHWA proposes to define 

the term asset management plan, which 

State DOTs would be required to 

develop under this proposed 

rulemaking. An asset management plan 

that is developed in accordance with the 

various contents, processes, and other 

requirements in these proposed 

regulations should serve the functions 

prescribed in this proposed definition. 

The term as used in this proposed rule 

refers to the risk-based asset 

management plan that is required under 

23 U.S.C. 119(e). 

Fifth, the FHWA proposes to define 

the term bridge to make clear that 

bridges required to be included in a 

State DOT’s asset management plan 

under this part are those subject to the 

National Bridge Inspection Standards in 

23 CFR part 650. The definition 

proposed here is the same definition as 

at 23 CFR 650.305. 

Sixth, the FHWA proposes to define 

the term investment strategy. This 

proposed definition is intended to 

clarify that the investment strategies 

result from evaluations of funding 

options and anticipated effects of the 

options on condition and performance 

of the physical assets. 

Seventh, the FHWA proposes to 

define the terms life-cycle cost and lifecycle cost analysis. The terms are 

intended to clarify that life cycle costs 

in the asset management context 

includes the costs of managing an asset 

over its whole life. The inclusion of 

these definitions in this proposed rule 

would make it clear that the definition 

of ‘‘life-cycle cost analysis’’ in 23 U.S.C. 

106(f) would not apply in the asset 

management context. 

Eighth, the FHWA proposes to define 

the term performance gap as simply 

meaning the gap between actual 

condition and performance of the NHS 

and the desired condition and 

performance of the NHS. 

Ninth, the FHWA proposes to define 

the terms risk and risk management as 

merely referring to potential positive or 

negative effects of uncertainty or 

variability of events on agency 

objectives and the means by which the 

agency manages this uncertainty. It is 

the FHWA’s belief that effective risk 

management helps State DOTs increase 

system resiliency against threats and 

capitalizes on opportunities. 

Tenth, the FHWA proposes to define 

the term STIP in order to ensure 

consistency with 23 CFR part 450. 

Finally, the FHWA proposes to define 

the term work type in order to refer to 

the range of actions a State DOT may 

take in managing an asset. The proposed 

definition includes actions to improve 

the state of good repair of highways and 

bridges, as well as to improve other 

aspects of their performance. 

Section 515.007 Asset Management 

Plan Development Process 

This section proposes minimum 

processes State DOTs would be required 

to use in developing their asset 

management plans. This section also 

proposes standards and outcomes the 

State DOT plan development processes 

would have to satisfy. The State DOTs 

would include descriptions of their 

processes in their asset management 

plans, and those processes would be 

subject to FHWA certification. The State 

DOT would use the processes to 

produce information it needs to develop 

the full plan contents required under 23 

U.S.C. 119(e)(4) and in this proposed 

rule. 

First, as required by 23 U.S.C. 

119(e)(4), the FHWA proposes that State 

DOTs must establish a process for 

conducting performance gap analysis to 

identify deficiencies that may be 

hindering achievement of State DOTs’ 

targets for condition and system 

performance as related to the physical 

assets. This process would include 

performance targets, gaps in the existing 

condition and desired condition of 

assets, gaps in the NHS effectiveness as 

it relates to the physical assets in 

providing for the safe and efficient 

movement of people and goods, and 

strategies to close these gaps. A State 

DOT would conduct a performance gap 

analysis for its NHS to meet 

requirements in 23 U.S.C. 119. As with 

the other required analyses under this 

proposed rule, if a State DOT chooses to 

include other public roads in the asset 

management plan, then the State DOT 

would conduct a performance gap 

analysis for those roads as well. States 

would develop the plan’s recommended 

investment strategies based on the result 

of this gap analysis and other analyses 

required for the asset management plan. 

Second, as required by 23 U.S.C. 

119(e)(4), the FHWA proposes that each 

State DOT establish a process for 

conducting life-cycle cost analysis for 

asset classes or asset sub-groups at the 

network level. The State DOT would 

define the network level. The FHWA 

proposes that State DOTs have the 

flexibility to conduct life-cycle cost 

analyses on asset classes (i.e., a group of 

assets with the same characteristics and 

function) or asset sub-groups (i.e., a 

group of assets within an asset class 

with the same characteristics and 

function) in recognition of the inherent 

differences in various types of assets. 

For example, a concrete pavement will 


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have a different life-cycle cost than an 

asphalt pavement. The proposed rule 

would allow a State DOT to propose 

excluding one or more asset sub-groups 

from its life-cycle cost analysis if the 

State DOT can demonstrate to FHWA 

the exclusion of the sub-group would 

have no material adverse effect on the 

development of sound investment 

strategies due to the limited number of 

assets in the sub-group, the level of cost 

impacts associated with managing the 

assets in the sub-group, or other 

supportable grounds. The FHWA would 

consider this proposal as part of its 

certification review under 23 U.S.C. 

119(e)(6). Life-cycle cost analysis is 

critical because it enables State DOTs to 

make informed decisions in developing 

investment strategies. 

Third, FHWA proposes that each 

State DOT establish a process for 

developing a risk management analysis 

for assets in the plan. This process 

would include identification, 

assessment, evaluation, and 

prioritization of risks that can affect the 

assets in the plan, including NHS 

condition, effectiveness, and system 

performance as it relates to operation of 

its physical assets. This includes 

addressing risks to those assets in the 

plan that are evaluated pursuant to 

section 1315(b) of MAP–21 because they 

have required repair and reconstruction 

activities on two or more occasions due 

to emergency events. In addition, the 

risk management analysis would have to 

include an approach for addressing the 

risks that the State DOT determines to 

be high-priority risks. Relevant risks 

may include risks to assets and the 

system associated with current and 

future environmental conditions, 

including extreme weather events, 

climate change, and seismic activity. 

Fourth, as required by 23 U.S.C. 

119(e)(4), the FHWA proposes that each 

State DOT establish a process for 

developing a financial plan. The FHWA 

proposes that the financial plan would 

be required to identify annual costs over 

a minimum period of 10 years. In 

addition, the FHWA proposes the State 

DOT’s process would have to produce a 

financial plan that addresses certain 

minimum components, including: The 

estimated cost of expected future work 

to implement investment strategies 

contained in the asset management 

plan; the estimated funding levels that 

are expected to be reasonably available 

to address the costs of future work 

types; identification of anticipated 

funding sources; and an estimate of the 

value of the agency’s pavement and 

bridge assets and the needed investment 

to maintain the value of these assets. 

The purpose is to ensure that the 

adopted strategies are not only 

affordable, but that assets will be 

preserved and maintained with no risks 

of financial shortfall. In addition, having 

an estimate of asset value will enable 

agencies to predict the level of 

investment needed to ensure their 

systems will be financially sustainable. 

Also, the FHWA proposes that asset 

management plans cover a minimum 

period of 10 years to ensure that the 

decisionmaking process identifies 

investment strategies that advance 

toward a long-term physically and 

financially sustainable system. 

Fifth, as required by 23 U.S.C. 

119(e)(4), the FHWA proposes that each 

State DOT establish a process for 

developing investment strategies to: (1) 

Achieve and sustain a state of good 

repair, (2) improve or preserve the 

condition of the assets and the 

performance of the NHS, and (3) lead to 

a program of projects that would make 

progress toward achievement of the 

State targets for asset condition and 

performance of the NHS in accordance 

with 23 U.S.C. 150(d), and support 

progress toward the achievement of the 

national goals identified in 23 U.S.C. 

150(b). The FHWA proposes that the 

State DOT’s process for identifying 

investment strategies must address the 

following minimum components: 

Performance gap analysis required 

under section 515.007(a)(4); life-cycle 

cost analysis for asset classes or asset 

sub-groups resulting from the process 

required under 515.007(a)(5); risk 

management analysis resulting from the 

process required under 515.007(a)(6); 

and anticipated available funding and 

estimated cost of expected future work 

types associated with various candidate 

strategies based on the financial plan 

required under 515.007(b)(7). 

Investment strategies are necessary for 

State DOTs to know how they will best 

use their available resources for optimal 

system performance. 

The FHWA proposes minimum 

standards each State DOT would use in 

developing and operating bridge and 

pavement management systems to 

analyze bridge and pavements data for 

the condition of Interstate highway 

pavements, non-Interstate NHS 

pavements, and NHS bridges. The use of 

these systems is required under 23 

U.S.C. 150(c)(3)(A)(i). Also, Congress 

declared the use of bridge management 

systems to be in the vital interest of the 

United States in 23 U.S.C. 144(a)(2)(C). 

These standards would govern 

collecting, processing, storing, and 

updating data; forecasting deterioration; 

developing and comparing benefit-cost 

analyses for alternative work types; 

identifying short and long range budget 

needs; determining optimal strategies on 

identified potential projects to manage 

pavements and bridges; and 

recommending programs and schedules 

for implementation. The standards 

proposed by the FHWA are consistent 

with minimum standards included in 

the management systems most widely 

used by State DOTs. The FHWA 

specifically requests comments on 

whether the specified standards for 

bridge and pavement management 

systems are appropriate or whether any 

additional standards should be 

included. 

The interaction of these proposed 

processes and related requirements is 

illustrated by a chart which is available 

on the rulemaking docket. 

The final step in the asset 

management plan development process 

is the development of the plan itself. 

Accordingly, the FHWA proposes to 

require specifically that each State DOT 

develop an asset management plan 

pursuant to the prescribed processes, 

which includes conducting the 

necessary analyses pursuant to those 

processes. An asset management plan 

brings the results of these analyses 

together in a single plan and 

demonstrates how selection of 

investment strategies is influenced by 

analyses of cost effectiveness, system 

resiliency, financial stability, and 

desired system condition and 

performance. The rule proposes to 

require the head of the State DOT to 

approve the asset management plan. 

Section 515.009 Asset Management 

Plan Content Requirements 

This proposed section sets forth 

minimum content requirements that 

would apply to a State DOT asset 

management plan. Under this section of 

the proposed rule, the results of the 

development processes proposed in 

section 515.007 would inform the 

strategic decisions described in the 

plan. Consistent with the definition of 

asset management in 23 U.S.C. 101(a), 

asset management plans would describe 

how the State DOT will carry out ‘‘a 

strategic and systematic process of 

operating, maintaining, and improving 

physical assets, with a focus on both 

engineering and economic analysis 

based on quality information, to identify 

a structured sequence of maintenance, 

preservation, repair, rehabilitation, and 

replacement actions that will achieve 

and sustain a desired state of good 

repair over the life cycle of the assets at 

minimum practicable cost.’’ As required 

by 23 U.S.C. 119(e)(2), asset 

management plans would describe the 

State DOT’s selected strategies to 

improve or preserve the condition of the 


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assets and the performance of the NHS 

and leading to a program of projects that 

would make progress toward 

achievement of the State targets for asset 

condition and performance of the NHS 

in accordance with 23 U.S.C. 150(d), 

and support progress toward the 

achievement of the national goals 

identified in 23 U.S.C. 150(b). 

Each asset management plan would 

address management of pavements on 

the Interstate System, pavements on the 

NHS (excluding the Interstate System), 

and bridges on the NHS in accordance 

with 23 U.S.C. 119(e)(4)(A). As provided 

in 23 U.S.C. 119(e)(3), State DOTs are 

encouraged, but not required, to include 

all highway infrastructure assets within 

the NHS ROW in the plan. State DOTs 

also are encouraged to include the 

highway infrastructure assets from other 

public roads in their asset management 

plans and to manage such other assets 

consistent with the asset management 

plan. As previously noted, if a State 

DOT elects to include such other assets, 

all of the analysis and plan content 

requirements proposed in this 

rulemaking would apply. The FHWA 

seeks comment on whether States 

should be required to include tunnels in 

the asset management plans. 

In section 515.009, FHWA proposes 

the minimum contents required in a 

State DOT’s asset management plan 

would include those required under 23 

U.S.C. 119. First, the plans would have 

to include the State DOT’s asset 

management objectives. The objectives 

are to be consistent with the purpose of 

asset management, which is to achieve 

and sustain a desired state of good 

repair over the life cycle of the assets at 

a minimum practicable cost. An 

agency’s objectives would set the 

context and direction for developing its 

asset management plan. These 

directions would be different from one 

agency to another, depending on past 

experience and its level of maturity in 

developing an asset management plan. 

Second, State DOT’s would be 

required to include measures and targets 

for the assets in their plans. The 

measures and targets would be used to 

show progress toward improving or 

preserving the condition of the various 

types of assets in the plan. At a 

minimum, State DOTs would need to 

include the 23 U.S.C. 150(c) national 

measures for pavement and bridge 

condition and performance, and the 

associated State targets developed 

pursuant to section 150(d), in their asset 

management plans once those measures 

and targets are established. However, 

FHWA recognizes that many States 

already have asset management plans, 

or elements of it in place that use 

measures and targets other than those 

that will be established pursuant to 

section 150. Given the level of effort 

required to substantially revise such 

plans, FHWA believes it is important to 

provide State DOTs with some 

flexibility to use and adapt those 

‘‘legacy’’ plans. Accordingly, FHWA 

proposes to allow State DOTs to include 

non-section 150 measures and targets 

for NHS bridges and pavements in their 

plans so long as such measures do not 

substitute for the section 150 measures 

and targets. Non-section 150 measures 

and targets may be used to supplement 

the section 150 measures and targets, 

but such use would not relieve the State 

DOT from its responsibilities to meet 

title 23 requirements relating to section 

150 measures and targets. 

Third, the State DOTs would have to 

include in the plan a summary listing of 

the pavement and bridge assets, 

including those on the NHS, and a 

description of their condition: This 

includes the State DOT’s Interstate 

pavement, non-Interstate NHS 

pavement, and NHS bridge assets. The 

FHWA proposes that State DOTs use 

these three categories in order to be 

consistent with the categories of 

condition and performance measures 

that will be established under 23 U.S.C. 

150(c)(3)(A)(ii). The summary list would 

have to include a description of the 

condition of the assets in the plan. 

Where applicable, the description of 

condition would be informed by the 

results of the evaluation required under 

proposed section 515.019 of this rule. It 

is the State DOTs’ responsibility to 

include all NHS pavements and bridge 

data regardless of NHS ownership. 

In the Transportation Planning NPRM 

(RIN 2125–AF52), FHWA addresses 

cooperation among multiple owners and 

operators for collection of NHS 

condition and performance data as part 

of the metropolitan planning 

agreements. However, these agreements 

apply to the metropolitan transportation 

planning process. The FHWA proposes 

that State DOTs develop a process for a 

collaborative and coordinated effort 

among NHS multiple owners within the 

rural areas in order to obtain the 

necessary data for development of the 

asset management plans. The FHWA 

also considered whether States should 

coordinate with Metropolitan Planning 

Organizations (MPO) on the 

development of the asset management 

plan. Section 134(h)(2)(D) of title 23, 

U.S.C., requires MPOs to integrate in the 

metropolitan transportation planning 

process the ‘‘goals, objectives, 

performance measures, and targets 

described in other State transportation 

plans and transportation processes, as 

well as any plans developed under 

chapter 53 of title 49 by providers of 

public transportation, required as part of 

a performance-based program.’’ As 

proposed in section 450.306(d)(4)(i) of 

the Transportation Planning NPRM (RIN 

2125–AF52), MPOs would be required 

to include in the metropolitan planning 

process the asset management plan 

developed in accordance with this 

rulemaking. As a result, FHWA believes 

that State DOTs should coordinate with 

MPOs during the development of the 

asset management plan. 

Fourth, the plans would have to 

include the results of the analyses 

required under section 515.007. This 

includes performance gap identification, 

life-cycle cost analysis, risk 

management analysis, a financial plan, 

and investment strategies. 

The FHWA also proposes that a State 

DOT’s asset management plan, for the 

assets in the plan, summarize the results 

of the evaluations under proposed 

section 515.019 to determine whether 

reasonable alternatives exist for roads, 

highways, or bridges that repeatedly 

have required repair and reconstruction 

activities following emergency events. 

As previously discussed, section 

515.019 of this proposed rule would 

require States to perform those 

statewide evaluations to fulfill the 

mandate in section 1315(b) of MAP–21. 

Proposed section 515.007 also would 

require the State DOT’s risk analysis 

discussion in the plan to reflect 

consideration of the section 1315(b) 

evaluations for assets covered by the 

plan. 

The FHWA proposes that asset 

management plans cover a minimum 

period of 10 years to ensure that the 

plan can support a decisionmaking 

process that identifies investment 

strategies that advance toward a longterm physically and financially 

sustainable system. The FHWA also 

proposes that asset management plans 

lead to an immediate program of 

projects in the STIP. It is the FHWA’s 

view that a State DOT should select 

such projects from the STIP as part of 

its efforts to achieve and sustain a state 

of good repair, to improve or preserve 

the condition of the assets and the 

performance of the NHS, to make 

progress toward achievement of the 

State’s targets for asset condition and 

performance of the NHS in accordance 

with 23 U.S.C. 150(d), and to support 

progress toward the achievement of the 

national goals identified in section 

150(b). 

In the proposed rule, the FHWA 

would require State DOTs to make their 

asset management plans available to the 

public, and encourages them to do so in 


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7The related rule for pavement and bridge 

conditions, ‘‘National Performance Management 

Measures; Assessing Pavement Condition for the 

National Highway Performance Program and Bridge 

Condition for the National Highway Performance 

Program’’ (RIN 2125–AF53), is available on the 

docket for review. 

a format that is easily accessible. The 

FHWA is proposing this provision 

because the asset management plan is 

an effective communication tool. It 

documents how decisions regarding 

investment strategies are made, what 

actions are taken to improve or preserve 

the condition of the assets and system 

performance, how risks to system 

performance are managed, and how the 

work of maintaining assets throughout 

their lives is considered. All of these 

documents provide the public with a 

wealth of information that can help 

assess whether transportation 

investments are being made wisely. 

Finally, the proposed regulation 

would clarify that other title 23 

regulations govern the establishment of 

the performance measures and State 

targets required by 23 U.S.C. 150, as 

well as the required reports on progress 

toward those targets. Inclusion of 

section 150 measures and targets in the 

State DOT’s asset management plans is 

required under 23 U.S.C. 119, for 

purposes of carrying out the asset 

management planning process. 

However, use of the measures and 

targets in the plan would not fulfill the 

reporting or other requirements under 

section 150. 

Section 515.011 Phase-In of Asset 

Management Plan Development 

In this section, the FHWA proposes to 

establish a process that will enable State 

DOTs to phase-in the development of 

their asset management plans. The 

FHWA recognizes that State DOTs are at 

different levels of sophistication and 

readiness to develop and implement an 

effective asset management plan. While 

some States may already have all of the 

required processes in place and analyses 

performed, other States may be only 

beginning to explore asset management. 

Those States need to have sufficient 

time to develop and implement the 

required processes and plans. In 

addition, there is a timing issue relating 

to 23 U.S.C. 150 measures and targets 

that FHWA believes require a phased-in 

approach. The timing problems affect 

the ability of State DOTs to include the 

section 150 measures and targets for 

NHS pavement and bridges in their 

initial asset management plans, and also 

affects the annual FHWA consistency 

determination required under 23 U.S.C. 

119(e)(5). The FHWA believes proposed 

section 515.011 would resolve these 

issues. 

Section 119(e)(5) sets a deadline for 

compliance with the asset management 

plan provisions in 23 U.S.C. 119 by the 

beginning of the second fiscal year 

following the FHWA’s establishment of 

the process for developing asset 

management plans. That process will be 

established through this rulemaking. 

Failure to develop and implement an 

asset management plan consistent with 

section 119 results in a reduced Federal 

share for NHPP projects. However, 

section 119(e)(2) requires asset 

management plans to include strategies 

leading to a program of projects that 

would make progress toward 

achievement of the States’ targets for 

asset condition and performance of the 

NHS in accordance with 23 U.S.C. 

150(d), and supporting progress toward 

the national goals identified in section 

23 U.S.C. 150(b). The FHWA is 

establishing the section 150 measures 

through a separate rulemaking,7

following which the statute gives State 

DOTs 1 year to establish their section 

150(d) targets. The FHWA rulemaking 

process under section 150, and the 

subsequent State DOT establishment of 

targets under section 150(d), might not 

be completed in a sufficient amount of 

time before the asset management plan 

consistency deadline in 23 U.S.C. 

119(e)(5) in order to permit the State 

DOT to incorporate the section 150 

measures and targets in its initial plan. 

If that is the case, a State DOT would 

not be able to demonstrate in the first 

consistency review that its asset 

management plan includes ‘‘strategies 

leading to a program of projects that 

would make progress toward 

achievement of the State targets for asset 

condition and performance of the 

National Highway System in accordance 

with section 150(d).’’ 

To address the risk that it may not be 

possible for the State DOTs to fully meet 

the section 119(e)(2) requirements with 

the first cycle of plan submissions, the 

FHWA proposes to permit State DOTs to 

submit their initial asset management 

plans based on criteria specified in 

proposed section 515.011. Under all 

circumstances, the State DOT’s first 

plan submission would have to include 

its proposed processes for each required 

area in proposed section 515.007, State 

DOT measures and target for assets in 

the plan, and the State DOT’s 

investment strategies. However, the 

proposed rule would give State DOTs 

the option of developing their initial 

asset management plans, including their 

investment strategies, using best 

available information in each required 

area. Investment strategies in the initial 

plan would have to satisfy the portion 

of section 119(e)(2) relating to the 

national goals in 23 U.S.C. 150(b). 

However, the plan’s strategies would 

not have to address the section 150(d) 

targets unless the State DOT has 

established those targets at least 6 

months before the plan submission 

deadline in section 515.013(a). The 

proposed rule also would permit a State 

DOT to omit the analyses for life-cycle 

costs, risk management, and the 

financial plan from its initial asset 

management plan. 

The proposed exceptions from the 

requirements of sections 515.007 and 

515.009 would apply only to the initial 

plan submission. The FHWA proposes 

to require State DOTs to amend their 

plans to include all the required 

analyses using FHWA-certified 

processes, the 23 U.S.C. 150 measures 

and targets, and investment strategies 

consistent with all of the requirements 

of 23 U.S.C. 119(e)(2), not later than 18 

months after the effective date of the 

final rulemaking for pavement and 

bridge condition measures pursuant to 

23 U.S.C. 150. However, under the 

proposed rule, FHWA could extend the 

18-month time period as needed to 

provide 12 months between the time 

FHWA certifies the State DOT’s 

processes under 23 U.S.C. 119(e)(6)(A) 

and the date the amended plan is due. 

The purpose of the proposed extension 

is to permit the State DOT a reasonable 

amount of time to incorporate section 

150 measures and targets and complete 

the required analyses using FHWAcertified processes. Under the proposed 

rule, FHWA could grant the extension 

only if it determines the State DOT’s 

initial plan meets the requirements of 

section 515.011. The proposed 18- 

month deadline for submission of an 

amended plan and the related extension 

provision mirror the deadline and 

extension provisions in MAP–21 section 

1106(a)–(b), relating to limitations on 

FHWA’s ability to obligate NHPP funds. 

Under this proposed phase-in 

approach, FHWA may determine an 

initial plan that conforms with proposed 

section 515.011 meets the consistency 

requirements under 23 U.S.C. 119(e)(5). 

The consistency determination would 

fulfill the ‘‘approved plan’’ requirement 

in the NHPP obligation transition 

provision in MAP–21 section 1106(b). 

The amended asset management plan, 

and any subsequent asset management 

plan submitted to the FHWA for a 

consistency determination under 

section 119(e)(5) or recertification of 

processes under 23 U.S.C. 119(e)(6)(B), 

would have to meet all requirements in 

section 119(e)(2) and proposed sections 

515.007 and 515.009 of this rule. 


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The FHWA specifically requests 

comment whether this proposed phasein approach is desirable and workable. 

Section 515.013 Process Certification 

and Plan Consistency Review 

In this section, the FHWA proposes 

the processes by which the State DOTs 

will submit to FHWA their asset 

management plan development 

processes for certification pursuant to 

23 U.S.C. 119(e)(6), and their asset 

management plans for a consistency 

determination under 23 U.S.C. 119(e)(5). 

The procedures for process certification 

and plan consistency determination in 

proposed section 515.013 are important 

to the implementation of several 

provisions relating to Federal-aid 

funding. First, section 119(e)(5) requires 

the Secretary to determine for the 

second fiscal year after the 

establishment of the Federal 

requirements that are the subject of this 

rulemaking, and for each fiscal year 

thereafter, whether the State has 

developed and implemented an asset 

management plan consistent with 

section 119. The lack of a consistency 

determination will result in a reduced 

Federal share for NHPP projects under 

23 U.S.C. 119(e)(5). 

A second provision affected by 

process certification and consistency 

determination is the transition provision 

in section 1106(b) of MAP–21. The 

transition provision allows FHWA to 

obligate NHPP funds for a period of time 

even though a State DOT does not have 

an approved asset management plan or 

has not established performance targets 

as described in 23 U.S.C. 119 and 23 

U.S.C. 150. The transition period 

expires when the State DOT has met 

those two requirements, but not later 

than 18 months after the effective date 

of the final performance management 

rulemaking under 23 U.S.C. 150. The 

FHWA may extend the 18-month 

transition period if FHWA determines 

the State DOT has made a good faith 

effort to establish an asset management 

plan and the performance targets 

described in sections 119 and 150. Once 

the transition period ends, FHWA 

cannot obligate NHPP funds for projects 

otherwise eligible under 23 U.S.C. 

119(d) unless the State DOT has an 

approved asset management plan and 

the required performance targets. 

Certification of State DOT Processes 

As noted above, 23 U.S.C. 119(e)(6) 

requires that the FHWA review and 

certify that the processes used by the 

State DOTs to develop their asset 

management plans meet the 

requirements established through this 

rulemaking. The FHWA also is required 

to recertify the State DOT’s processes at 

least every 4 years pursuant to 23 U.S.C. 

119(e)(6)(B). In this rule, the FHWA 

proposes that State DOTs include the 

necessary asset management plan 

development processes as part of the 

initial asset management plan submitted 

to the FHWA not later than 1 year after 

the effective date of the final rule on 

asset management. This time frame is 

intended to give the State DOTs 

sufficient time to prepare their 

processes and other parts of their initial 

plans, and receive the required FHWA 

process certification and consistency 

determination, before the 

implementation deadline contained in 

23 U.S.C. 119(e)(5). That deadline is the 

beginning of the second fiscal year after 

the effective date of the final rule 

establishing the asset management plan 

development process. 

The FHWA would review and 

respond (i.e., approve or disapprove 

with comments) to the State DOT’s 

request for certification of the State 

DOT’s processes for plan development 

within 90 days after the FHWA receives 

the State DOT’s request. Following the 

year of initial certification, State DOTs 

would then update their plans and 

resubmit their processes to the FHWA 

on October 1 every 4 years for 

recertification in compliance with 

section 119(e)(6)(B). 

In addition, under proposed section 

515.013(d), whenever a State DOT 

amends its asset management plan, it 

would be required to submit the 

amended plan to the FHWA for a new 

process certification at least 30 days 

prior to the deadline for the next 

FHWA’s consistency determination 

(August 31 of each year). Minor 

technical corrections and revisions with 

no foreseeable material impact on the 

accuracy and validity of the analyses 

and investment strategies in the plan 

would not require submission to FHWA. 

If FHWA determines that a State DOT’s 

processes do not meet the requirements 

of these proposed regulations, the State 

DOT will have an opportunity to cure 

the deficiencies, as required under 23 

U.S.C. 119(e)(6)(C). The FHWA will 

send the State DOT a written notice of 

denial of certification or recertification 

that specifically identifies and lists the 

deficiencies. The State DOT will then 

have 90 days (which FHWA may extend 

upon request) to correct the deficiencies 

and resubmit its process to FHWA. If a 

State DOT’s processes have minor 

deficiencies, then FHWA may proceed 

to certify the State DOT’s processes on 

the condition that the minor 

deficiencies are corrected within 90 

days of the receipt of the notification of 

certification. The State DOT must notify 

FHWA, in writing, once it has corrected 

the deficiencies. 

Consistency Determination 

The FHWA proposes to rely on the 

State DOT’s most recently submitted 

asset management plan in making the 

annual consistency determination 

required by 23 U.S.C. 119(e)(5). The first 

consistency determination would be 

made by August 31 of the first fiscal 

year following the effective date of the 

final rule in this rulemaking. The 

subsequent consistency determinations 

would be made by August 31 of each 

fiscal year thereafter. The FHWA 

proposes the August 31 date to give a 

State DOT time to adjust its program in 

the event the State DOT receives a 

negative determination and the Federal 

share is reduced for the next fiscal year. 

The FHWA requests comments on 

whether this time period is needed, and 

whether the proposed 30-day period 

between the determination and the start 

of the next fiscal year is sufficient. 

Except for the proposed phase-in for 

initial plans under section 515.011, in 

order for FHWA to find a plan 

consistent with the asset management 

requirements in 23 U.S.C. 119, the plan 

would need to include the minimum 

required contents, would have been 

developed using the State DOT’s 

FHWA-certified processes for the 

necessary analyses, would include the 

23 U.S.C. 150 measures and targets, and 

would contain strategies meeting the 

requirements in 23 U.S.C. 119(e)(2). 

The purpose of FHWA’s receipt of the 

State-approved asset management plan 

is to make the process certification and 

consistency determinations required 

under 23 U.S.C. 119(e)(5)–(6). The 

FHWA would not take any action to 

approve or disapprove a plan beyond 

the required process certification and 

consistency determinations. The 

investment decisions and judgments 

made by State DOTs in their asset 

management plans are within the scope 

of the FHWA asset management plan 

reviews. 

The FHWA specifically requests 

comments on the proposed process 

certification and consistency 

determination processes proposed in 

section 515.013. 

Section 515.015 Penalties 

This section discusses the statutory 

penalties for State DOTs that do not 

develop and implement an asset 

management plan consistent with the 

requirements of 23 U.S.C. 119 and this 

proposed rule. The penalties that the 

FHWA is proposing in this section are 

penalties required by law. First, as 

mentioned above, 23 U.S.C. 119(e)(5) 


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reduces the Federal share for NHPP 

projects to 65 percent if a State DOT 

does not develop and implement an 

asset management plan consistent with 

the requirements of 23 U.S.C. 119 and 

this proposed rule by the beginning of 

the second fiscal year after the effective 

date of the final rule. Second, after the 

transition period in MAP–21 section 

1106(b), the FHWA cannot approve any 

further projects using NHPP funds if the 

State DOT has not developed and 

implemented an asset management plan 

that is consistent with the requirements 

of 23 U.S.C. 119 and this proposed rule, 

and established the performance targets 

required under 23 U.S.C. 150(d) 

regarding the condition and 

performance of the NHS. The transition 

period ends when the State DOT has a 

conforming asset management plan and 

section 150(d) targets, but not later than 

the date that is 18 months after the 

effective date of the final rulemaking for 

pavement and bridge condition 

measures pursuant to 23 U.S.C. 150(c). 

Section 1106(b)(2) of MAP–21 provides 

FHWA with the authority to extend this 

time period if the State DOT has made 

a good faith effort to establish an asset 

management plan and the required 

performance targets. 

The FHWA consistency determination 

under 23 U.S.C. 119(e)(5), and FHWA 

obligation decisions for NHPP funds, 

look at two major elements: Plan 

development and plan implementation. 

The FHWA proposes to make the 

determination whether a plan meets the 

development requirements based on 

whether the State DOT has complied 

with sections 515.007 and 515.009 of 

the proposed rule. The FHWA believes 

the plan implementation determination 

should be focused on whether the plan’s 

investment strategies satisfy the 23 

U.S.C. 119(e)(2) requirements (i.e., lead 

to a program of projects that would 

make progress toward achievement of 

the States’ targets for asset condition 

and performance of the NHS in 

accordance with 23 U.S.C. 150(d), and 

supporting progress toward the national 

goals identified in 23 U.S.C. 150(b)). 

This suggests FHWA will need a 

method to easily identify projects the 

State DOT believes meets the section 

119(e)(2) requirements. The FHWA 

requests comments on whether the rule 

should specify one or more methods 

State DOTs could use to identify such 

projects. For example, the rule could 

leave the method of identification 

entirely to the State DOT’s discretion, or 

the rule could allow the State DOTs to 

use one of several options, such as: 

(1) A State DOT could identify the 

projects in its asset management plan. 

(2) A State DOT could identify the 

projects by using an identifying symbol, 

such as an asterisk or number, in its 

STIP. 

(3) A State DOT could include a 

summary discussion in its STIP 

identifying the projects, or program of 

projects. 

(4) The State DOT could submit a list 

to FHWA by August 31 of each fiscal 

year identifying the projects authorized 

during the fiscal year that the State DOT 

believes demonstrate the State DOT has 

met the section 119(e)(2) requirements. 

(5) The State DOT could include a 

summary in its STIP of anticipated 

funding broken down into categories 

based on the recommended investment 

strategies in the asset management plan, 

with enough detail to guide project 

selection. 

The FHWA requests comments on 

other possible approaches to 

determining whether a State DOT has 

implemented its asset management 

plan. The FHWA also seeks comments 

on any problems State DOTs might 

anticipate in identifying projects that 

meet the requirements of 23 U.S.C. 

119(e)(2), and ideas for resolving any 

anticipated problems. 

Section 515.017 Organizational 

Integration of Asset Management 

This section describes practices that 

State DOTs are encouraged to consider 

to support the development and 

implementation of asset management 

plans. These practices include the 

establishment of strategic goals, 

conducting periodic self-assessments, 

and conducting a gap analysis to 

determine which areas of the asset 

management development and 

implementation process require 

improvement. 

Section 515.019 Periodic Evaluations 

of Facilities Requiring Repair or 

Reconstruction Due to Emergency 

Events 

This proposed regulation fulfills the 

rulemaking requirement in section 

1315(b) of MAP–21 and is consistent 

with the purpose of that section. Section 

1315(b) of MAP–21 requires periodic 

evaluations to determine if reasonable 

alternatives exist for roads, highways, or 

bridges that repeatedly require repair 

and reconstruction activities due to 

emergency events. The purposes of 

section 1315(b) are to conserve Federal 

resources, protect public safety and 

health, and reduce the need for Federal 

funds to be expended on repeated repair 

and reconstruction activities, better 

protect the environment, and meet 

transportation needs. Emergency events 

include extreme weather events, natural 

disasters, and other catastrophic events 

that damage roads, highways, or bridges. 

Examples include floods, hurricanes, 

earthquakes, tornadoes, tidal waves, 

severe storms, or landslides. 

The threshold for requiring evaluation 

under the proposed rule would be 

whether a road, highway, or bridge has 

required repair or reconstruction on at 

least two occasions due to emergency 

events. The proposed rule would define 

‘‘emergency event’’ to mean a natural 

disaster or catastrophic failure due to 

external causes resulting in an 

emergency declared by the Governor of 

the State or an emergency or disaster 

declared by the President of the United 

States. 

The proposed rule would apply only 

to roads, highways, and bridges that are 

owned by a State or local governmental 

entity (e.g., State DOT, State toll 

authority, city, or county) and are 

eligible for funding under title 23. These 

limitations are in recognition of several 

factors. First, MAP–21 section 1315 

contains no clear language requiring 

inclusion of facilities that received 

funding from other Federal agencies. It 

is reasonable to conclude its language 

was meant to conserve title 23 

resources. Second, FHWA believes it 

would be unreasonably difficult for 

State DOTs to determine which roads, 

highways and bridges may have 

received non-title 23 Federal funding in 

the past, or might be eligible to receive 

non-title 23 Federal funding in the 

future. Finally, as a result of an earlier 

rulemaking, Environmental Impact and 

Related Procedures NPRM (77 FR 

59875, Oct. 1, 2012), the FHWA decided 

to address the section 1315(b) 

requirements for States through this 

rulemaking. The FHWA does not 

believe it would be appropriate to 

expand this State-focused rulemaking to 

address any section 1315(b) 

requirements for federally owned roads, 

highways, and bridges. 

Under the proposed rule, the State 

DOT must complete its evaluation for 

affected highways and bridges on the 

NHS, and any other assets included in 

the State DOT’s asset management plan, 

not later than 2 years after the effective 

date of the final rule established through 

this rulemaking. The State DOT would 

have to complete the evaluation for all 

other roads, highways, and bridges in 

the State not later than 4 years after the 

effective date of the final rule in this 

rulemaking. The State DOT would be 

required to update the statewide 

evaluation after every emergency event 

to the extent the event caused additional 

facilities to meet the threshold for an 

alternatives evaluation. The proposed 

rule would require the State DOT to 


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review and update the statewide 

evaluation at least every 4 years after the 

initial evaluation. State DOTs would be 

encouraged to establish an evaluation 

cycle that facilitates consideration of the 

results of the evaluation in the State 

DOT’s asset management plan and STIP. 

The proposed rule would require the 

State DOT to make the evaluation 

available to FHWA upon request. 

The State DOT would be required by 

proposed sections 515.019, 515.007, and 

515.009 to use the results of the 

evaluation in its asset management plan 

to the extent the evaluation covers 

assets in the plan. The State DOT would 

include a summary of its section 1315(b) 

evaluation for pavements and bridges on 

the NHS, and those for any other assets 

included in the asset management plan 

at the option of the State DOT, as part 

of the risk analysis in its asset 

management plan. 

The FHWA received comments from 

12 commenters in response to the 

Environmental Impact and Related 

Procedures NPRM (77 FR 59875, Oct. 1, 

2012), implementing section 1315 of 

MAP–21, who mostly supported 

including this analysis as part of the 

asset management plans described in 

this NPRM. In particular, the FHWA 

received eight comments on whether 

this analysis should be included as part 

of the asset management plans. These 

commenters were AASHTO, the 

American Public Transportation 

Association (APTA), and six State DOTs 

(Alaska Department of Transportation 

and Public Facilities (ADOT&PF), Texas 

DOT, California DOT, North Dakota 

DOT, Washington State DOT, and Ohio 

DOT). Of these commenters, only one 

comment (North Dakota DOT) was 

opposed to including this analysis as 

part of the asset management plan, 

stating that too few States have the 

ability to immediately implement asset 

management plans. However, in 

accordance with 23 U.S.C. 119(e), all 

States must develop and implement an 

asset management plan. The asset 

management plan phase-in provisions 

proposed under section 515.011, as well 

as the phase-in proposed in section 

515.019, should facilitate the transition 

for those State DOTs not already using 

some form of asset management. 

Three commenters, ADOT&PF, Texas 

DOT, and Transportation 

Transformation Group suggested the 

FHWA grant the State flexibility with 

respect to the frequency of the reviews 

or how the reviews are conducted. The 

FHWA is proposing the State DOTs 

perform the evaluations of NHS 

highways and bridges, and any other 

assets included in the State DOT asset 

management plan, within 2 years after 

the final rule established through this 

rulemaking. This is to facilitate 

consideration of the evaluation in the 

asset management plan. This schedule 

also recognizes the priority Congress 

placed on improving and preserving the 

NHS in MAP–21. For other roads, 

highways, and bridges, the State DOT 

would have to complete the evaluation 

no later than 4 years after the final rule 

established through this rulemaking. 

The FHWA does not specify in this 

NPRM the manner in which the States 

must conduct these reviews, only that 

these reviews must be consistent with 

the mandate in section 1315(b) of MAP– 

21. The FHWA expects that each State 

DOT will keep current data regarding 

facilities that repeatedly require repair 

and reconstruction following emergency 

events. If damage due to emergency 

events occurs to a road, highway, or 

bridge on two or more occasions, the 

State DOT would determine if 

reasonable alternatives exist to reduce 

the potential for future damage and 

repair costs and better protect public 

safety and health and the environment. 

These evaluations would consider the 

risk of recurring damage and the cost of 

future repair under current and future 

environmental conditions. For purposes 

of section 1315(b), a reasonable 

alternative would meet transportation 

needs as described in relevant and 

applicable Federal, State, local and 

tribal plans, including those required 

under 23 CFR part 450. The FHWA is 

proposing this approach to conserve 

Federal resources and to increase the 

resilience of the transportation system. 

The proposed approach would help 

ensure that future project development 

and funding decisions for these facilities 

are informed by these evaluations, and 

therefore meet the intent of section 

1315(b) of MAP–21. 

The FHWA received four comments 

(Texas DOT, New York State 

Metropolitan Transportation Authority, 

Transportation Transformation Group, 

and Southeast Pennsylvania 

Transportation Authority) stating that 

these evaluations would best be 

conducted at the State or local level. 

The FHWA agrees that these evaluations 

are best conducted at the State or local 

level. However, with respect to facilities 

under the jurisdiction of a local public 

agency, State DOTs are responsible for 

ensuring that appropriate evaluations 

are carried-out for those facilities in 

their State. 

Finally, the FHWA received four 

comments on the factors to be 

considered as part of this reasonable 

alternatives analysis. Two of these 

comments (Texas DOT and APTA) 

requested that FHWA allow States to 

determine the factors. Another comment 

(Advisory Council on Historic 

Preservation) requested that the FHWA 

require States to consider the effects on 

historic properties. The fourth comment 

(ADOT&PF) proposed some factors that 

should be considered when assessing 

the risk of recurring damage, including 

the severity of damage, cost of a 

permanent solution, and the 

maintenance and operations of the 

current facility and permanent solution. 

In this NPRM, the FHWA proposes that 

States take into account the factors 

specified in 1315(b) of MAP–21 when 

evaluating whether reasonable 

alternatives exist for roads, highways, or 

bridges that repeatedly require repair 

and reconstruction activities following 

emergency events. States would be 

required to evaluate whether reasonable 

alternatives exist that: Reduce the need 

for Federal funds to be expended on 

such repair and reconstruction 

activities; better protect public safety 

and health and the environment; and 

meet transportation needs as described 

in relevant and applicable Federal, 

State, local, and tribal plans. States are 

free to use other factors at their 

discretion; however, the statutorily 

required factors must be taken into 

account. The FHWA declines to include 

a specific reference in the regulation to 

historic properties. The proposed 

regulation calls for consideration of the 

human and natural environment in the 

evaluation. That phrase includes a wide 

range of potential environmental 

impacts, including those on historic and 

cultural resources. Including references 

to some types of human or natural 

environmental resources, while omitting 

references to others, could be 

misinterpreted as intended to give 

greater weight to the listed resource(s). 

The FHWA recognizes MAP–21 

section 1315(b) requirements may pose 

challenges for some State DOTs. The 

FHWA requests comments on potential 

alternative methods for meeting the 

section 1315(b) requirements, and asks 

for comments on the following specific 

questions: 

(1) Is the amount of time allotted in 

proposed section 515.019 for the initial 

evaluation of NHS assets and other 

assets included in the State DOT asset 

management plan (2 years), and for all 

other roads, highways, and bridges (4 

years), appropriate? If not, how much 

time should be allotted? 

(2) Is the 4-year general update cycle 

for the statewide evaluation 

appropriate? If not, what would be a 

reasonable cycle for the ongoing 

periodic evaluation required under 

section 1315(b)? 


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8Smadi, Omar, Quantifying the Benefits of 

Pavement Management, a paper from the 6th 

International Conference on Managing Pavements, 

2004 

(3) Should the FHWA establish a limit 

to the length of the ‘‘look back’’ State 

DOTs will do in order to determine 

whether a road, highway, or bridge has 

been repaired or reconstructed on two 

or more occasions? If so, what would be 

an appropriate and feasible length of 

time? 

(4) Should the regulation address the 

types of data sources that should be 

considered to determine whether a road, 

highway, or bridge has been repaired or 

reconstructed on two or more 

occasions? If so, what types of data 

sources would be most appropriate? 

(5) Should the rule specify required 

content for the evaluations in greater 

detail? If so, what elements ought to be 

required? 

(6) Should the regulation require the 

State to consider the section 1315(b) 

alternatives evaluation prior to 

requesting title 23 funding for a project? 

(7) Should the regulation address 

when and how FHWA would consider 

the section 1315(b) alternatives 

evaluation in connection with an FHWA 

project approval? 

Rulemaking Analyses and Notices 

Executive Order 12866 (Regulatory 

Planning and Review), Executive Order 

13563 (Improving Regulation and 

Regulatory Review), and DOT 

Regulatory Policies and Procedures 

The FHWA has determined that this 

action would be a significant regulatory 

action within the meaning of Executive 

Order 12866 and within the meaning of 

DOT’s regulatory policies and 

procedures. This rulemaking 

implements a congressional mandate 

that States develop and implement riskbased asset management plans for 

Interstate highway pavements, nonInterstate NHS highway pavements, and 

NHS bridges. In addition, State DOTs 

must meet minimum standards 

established by the Secretary of 

Transportation in developing pavement 

and bridge management systems. This 

action is considered significant because 

of the substantial State DOT interest in 

the requirements for developing riskbased asset management plans, and the 

proposed minimum standards for the 

pavement and bridge management 

systems. In addition, this rulemaking 

implements section 1315(b) of MAP–21 

by requiring States to conduct 

evaluations to determine if reasonable 

alternatives exist to roads, highways, or 

bridges that repeatedly require repair 

and reconstruction activities from 

emergency events, and to take these 

evaluations into account in the asset 

management plans for facilities that are 

included in these plans. However, this 

action is not economically significant 

within the meaning of Executive Order 

(EO) 12866. 

The FHWA is presenting a Regulatory 

Impact Analysis (RIA) in support of this 

NPRM. The RIA estimates the economic 

impact, in terms of costs and benefits, 

on State DOTs as required by EO 12866 

and EO 13563. This section of the 

NPRM identifies and estimates costs 

and benefits resulting from the proposed 

rule in order to inform policy makers 

and the public of the relative value of 

the current proposal. The complete RIA 

may be accessed in the rulemaking’s 

docket (FHWA–2013–0052). 

The costs and benefits were estimated 

for implementing the requirement for 

States to develop a risk-based asset 

management plan and to use pavement 

and bridge management systems that 

comply with the minimum standards 

proposed by this NPRM. For this 

analysis, the base case is assumed to be 

the current state of the practice, where 

most State DOTs already own pavement 

and bridge management systems, but 

have not developed risk-based asset 

management plans. 

Estimated Costs of the Proposed Rule 

The costs of preparing an asset 

management plan was estimated based 

on information obtained from nine State 

DOTs. Based on that information, 

FHWA estimates that the total cost of 

developing the initial plan and three 

updates for all 50 States, the District of 

Columbia, and Puerto Rico States, 

covering a 12 year time period, would 

be $37.3 million discounted at 3 percent 

and $31.1 million discounted at 7 

percent, an annual cost of $3.1 million 

and $2.6 million respectively. These 

estimates may be conservative, since 

many agencies may already be 

developing planning documents that 

could feed into the asset management 

plans or be replaced by them, therefore 

saving some costs to the agencies. 

An additional cost of $4 million to $6 

million in total is estimated for 

acquiring pavement management 

systems for all non-complying agencies. 

There are currently four States that 

don’t currently have pavement and 

bridge management systems that meet 

the standards of the proposed rule. 

Therefore, the total nationwide costs 

for all States to develop their initial 

asset management plans with three 

updates over the course of 12 years and 

for the four States to acquire and install 

pavement management systems would 

be $43.2 million discounted at 3 percent 

and $36.7 million discounted at 7 

percent. 

Estimated Benefits of the Proposed Rule 

The FHWA lacks data on the 

economic benefits of the practice of 

asset management as a whole. The field 

of asset management has only become 

common in the past decade and case 

studies of economic benefits from 

overall asset management have not been 

published. We specifically request that 

commenters submit data on the 

quantitative benefits of asset 

management and reference any studies 

focusing on the economic benefits of 

overall asset management. 

While FHWA lacks data on the overall 

benefits of asset management, there are 

examples of the economic savings that 

result from the most typical component 

sub-sets of asset management, pavement 

and bridge management systems. 

Pavement and bridge management 

systems are software and analysis tools 

whereas asset management is a 

decisionmaking framework and 

approach leading to cost effective 

investment strategies. Pavement and 

bridge management systems are used to 

analyze massive amounts of pavement 

and bridge data. The information from 

the pavement and bridge management 

systems is then used to develop the 

asset management plan. 

Taking a study conducted using Iowa 

DOT data 8 as an example of the 

potential benefits of applying a longterm asset management approach using 

a pavement management system, the 

costs of developing the asset 

management plans and acquiring 

pavement management systems are 

compared to determine if the benefits of 

the proposed rule would exceed the 

costs. We estimate the total benefits for 

the 50 States, District of Columbia, and 

Puerto Rico of applying pavement 

management systems and developing 

asset management plans to be $453.5 

million discounted at 3 percent and 

$340.6 million discounted at 7 percent. 

The FHWA requests comments on this 

estimate. 

Based on the benefits derived from 

the Iowa DOT study and the estimated 

costs of asset management plans and 

acquiring pavement management 

systems, the ratio of benefits to costs 

would be 10.5 at a 3 percent discount 

rate and 9.3 at a 7 percent discount rate. 

The estimated benefits do not include 

the potential benefits resulting from 

savings in bridge programs. The benefits 

for States already practicing good asset 

management decisionmaking using their 

pavement management systems will be 


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lower, as will the costs. If the 

requirement to develop asset 

management plans only marginally 

influences decisions on how to manage 

the assets, benefits are expected to 

exceed costs. 

Summary of Benefits and Costs of Asset 

Management Plan Rule 

Discounted at 

3 percent 

Discounted at 

7 percent 

Total Benefits for 50 States, District of Columbia, and Puerto Rico ........................................................... $453,517,289 $340,580,916 

Total Cost for 50 States, District of Columbia, and Puerto Rico ................................................................ $43,159,635 $36,701,377 

Benefit Cost Ratio ........................................................................................................................................ 10.5 9.3 

Threshold Analysis 

To estimate the threshold benefits 

necessary from pavement or bridge 

preservation for the rule to be 

worthwhile, we use the incremental 

benefits that can be realized by road 

users in vehicle operating cost 

reductions due to improvements in 

pavement or bridge condition. The 

estimates used for the user costs in the 

break-even analysis are based on the 

numbers derived for the ‘‘Establishment 

of National Bridge and Pavement 

Condition Performance Management 

Measures Regulatory Impact Analysis.’’ 

(See Docket Number FHWA–2013– 

0053). The FHWA estimated the cost 

saving per mile of travel on pavement 

with fair condition versus pavement in 

poor condition to be $0.01 per vehicle, 

averaged for the share of trucks and cars 

on the NHS. Dividing the cost of the 

rule by this cost, the number of vehicle 

miles of travel (VMT) to be improved to 

cover the cost of the rule was estimated. 

Then taking the ratio of the VMT to be 

improved to the number of VMT in poor 

condition and multiplying by number of 

NHS miles in poor condition, the 

number of lane miles to be improved to 

cover the cost of the rule are estimated. 

To cover the $49.9 million 

undiscounted cost of the rule, 

approximately 127 lane miles would 

have to be improved from poor 

condition to fair condition to generate 

user benefits to make the rule 

worthwhile. 

For bridges, FHWA estimated the 

additional user cost (travel time and 

vehicle operating costs) of a detour due 

to a weight restricted bridge. According 

to NBI, the average detour is equal to 20 

miles. The estimated average user cost 

per truck is $1.69 per mile. Each posted 

bridge is estimated to impose a detour 

cost of $33.82 per truck. ($1.69 per VMT 

× 20 miles). Based on the number of 

trucks affected by the weight 

restrictions, it is estimated that two 

weight restricted bridge postings would 

have to be avoided to meet the cost of 

the rule. 

The above description of the benefits 

of asset management is based on the 

limited data available on the benefits of 

pavement and bridge management 

systems, the most typical component 

sub-sets of asset management. The 

FHWA does not have sufficient 

information to estimate total costs and 

benefits of asset management as a 

whole. We specifically request that 

commenters submit information on the 

quantitative benefits of asset 

management. 

A copy of the FHWA’s RIA has been 

placed in the docket. The FHWA 

requests comments on the RIA that has 

been conducted for this rule. 

Regulatory Flexibility Act 

In compliance with the Regulatory 

Flexibility Act (Pub. L. 96–354, 5 U.S.C. 

601–612), the FHWA has evaluated the 

effects of this action on small entities 

and has determined that the action 

would not have a significant economic 

impact on a substantial number of small 

entities. The proposed amendment 

addresses the obligation of Federal 

funds to States for Federal-aid highway 

projects. As such, it affects only States, 

and States are not included in the 

definition of small entity set forth in 5 

U.S.C. 601. Therefore, the Regulatory 

Flexibility Act does not apply, and the 

FHWA certifies that the proposed action 

would not have a significant economic 

impact on a substantial number of small 

entities. 

Unfunded Mandates Reform Act of 1995 

This proposed rule would not impose 

unfunded mandates as defined by the 

Unfunded Mandates Reform Act of 1995 

(Pub. L. 104–4, 109 Stat. 48, March 22, 

1995) as it would not result in the 

expenditure by State, local, or tribal 

governments, in the aggregate, or by the 

private sector, of $151 million or more 

in any one year (2 U.S.C. 1532). 

Executive Order 13132 (Federalism 

Assessment) 

The FHWA has analyzed this NPRM 

in accordance with the principles and 

criteria contained in EO 13132. The 

FHWA has determined that this action 

would not have sufficient federalism 

implications to warrant the preparation 

of a federalism assessment. The FHWA 

has also determined that this action 

would not preempt any State law or 

State regulation or affect the States’ 

ability to discharge traditional State 

governmental functions. 

Executive Order 12372 

(Intergovernmental Review) 

The regulations implementing EO 

12372 regarding intergovernmental 

consultation on Federal programs and 

activities apply to this program. Local 

entities should refer to the Catalog of 

Federal Domestic Assistance Program 

Number 20.205, Highway Planning and 

Construction, for further information. 

Paperwork Reduction Act 

Under the Paperwork Reduction Act 

of 1995 (PRA) (44 U.S.C. 3501, et seq.), 

Federal agencies must obtain approval 

from Office of Management and Budget 

(OMB) for each collection of 

information they conduct, sponsor, or 

require through regulations. This action 

contains a collection-of-information 

requirement under the PRA. The MAP– 

21 requires State DOTs to develop riskbased asset management plans for NHS 

bridges and pavements to improve or 

preserve the condition of the assets and 

the performance of the system. It also 

requires the Secretary of Transportation 

to review the processes State DOTs have 

used to develop their asset management 

plans, and to determine if States have 

developed and implemented their asset 

management plans consistent with the 

MAP–21 requirements. 

In order to be responsive to the 

requirements of MAP–21, FHWA 

proposes that State DOTs submit their 

asset management plans, including the 

processes used to develop these plans, 

to FHWA for: (1) Certification of the 

processes, and (2) a determination that 

the asset management plans have been 

developed consistent with the certified 

processes; however, these plans are not 

subject to the FHWA approval. 

A description of the collection 

requirements, the respondents, and an 

estimate of the burden hours per data 

collection cycle are set forth below: 

Collection Title: State DOTs’ RiskBased Asset Management Plan 

including its processes for the NHS 

bridges and pavements. 


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Type of Request: New information 

collection requirement. 

Respondents: 50 States, the District of 

Columbia, and Puerto Rico. 

Frequency: One collection every 4 

years. 

Estimated Average Burden per 

Response per Data Collection Cycle: 

Some early examples of asset 

management plan burden hours are 

available. The transportation agencies 

for Minnesota, Louisiana, and New York 

are cooperating with the FHWA to 

produce three early transportation asset 

management plans. These three States 

represent three different approaches that 

illustrate the possible range of costs and 

level of effort for conducting asset 

management plans. In addition, the 

information relative to the burden hours 

from Colorado DOT is included in the 

benefit-cost analysis for this proposed 

rule as required by EO 12866. The result 

of that analysis indicates that the 

average burden hours per State for 

developing the initial asset management 

plan would be approximately 2,600 

hours. However, on average, 

development of subsequent plans would 

require less effort because the processes 

have already been developed. The 

estimate for updating plans for future 

submission indicates that approximately 

1,300 burden hours per State per datacollection cycle would be required. 

The FHWA invites interested persons 

to submit comments on any aspect of 

the proposed information collection, 

including the FHWA’s estimate of the 

burden hours of the proposed 

information collection. Comments 

submitted in response to this notice will 

be summarized or included, or both, in 

the request for OMB approval of this 

information collection. 

National Environmental Policy Act 

Agencies are required to adopt 

implementing procedures under the 

National Environmental Policy Act of 

1969 (NEPA), as amended (42 U.S.C. 

4321 et seq.), that establish specific 

criteria for, and identification of, three 

classes of actions: Those that normally 

require preparation of an environmental 

impact statement; those that normally 

require preparation of an environmental 

assessment; and those that are 

categorically excluded from further 

NEPA review (40 CFR 1507.3(b)). The 

FHWA’s procedures are found in 23 

CFR part 771. This proposed action 

qualifies for categorical exclusions 

under 23 CFR 771.117(c)(20) 

(promulgation of rules, regulations, and 

directives) and 771.117(c)(1) (activities 

that do not lead directly to 

construction). The FHWA has evaluated 

whether the proposed action would 

involve unusual circumstances and has 

determined that this proposed action 

would not involve such circumstances. 

Executive Order 12630 (Taking of 

Private Property) 

The FHWA has analyzed this 

proposed rule under EO 12630, 

Governmental Actions and Interference 

with Constitutionally Protected Property 

Rights. The FHWA does not anticipate 

that this proposed action would affect a 

taking of private property or otherwise 

have taking implications under EO 

12630. 

Executive Order 12988 (Civil Justice 

Reform) 

This action meets applicable 

standards in sections 3(a) and 3(b)(2) of 

EO 12988, Civil Justice Reform, to 

minimize litigation, eliminate 

ambiguity, and reduce burden. 

Executive Order 12898 (Environmental 

Justice) 

The EO 12898, Federal Actions to 

Address Environmental Justice in 

Minority Populations and Low-Income 

Populations, and DOT Order 5610.2(a), 

91 FR 27534 (May 10, 2012) (available 

online at www.fhwa.dot.gov/

environment/environmental_justice/ej_

at_dot/order_56102a/index.cfm), 

requires DOT agencies to achieve 

environmental justice (EJ) as part of 

their mission by identifying and 

addressing, as appropriate, 

disproportionately high and adverse 

human health or environmental effects, 

including interrelated social and 

economic effects, of their programs, 

policies, and activities on minority 

populations and low-income 

populations in the United States. The 

DOT Order requires DOT agencies to 

address compliance with the EO and the 

DOT Order in all rulemaking activities. 

In addition, FHWA has issued 

additional documents relating to 

administration of the EO and the DOT 

Order. On June 14, 2012, FHWA issued 

an update to its EJ order, FHWA Order 

6640.23A, FHWA Actions to Address 

Environmental Justice in Minority 

Populations and Low-Income 

Populations (available online at 

www.fhwa.dot.gov/legsregs/directives/

orders/664023a.htm). 

The FHWA has evaluated this 

proposed rule under the EO, the DOT 

Order, and the FHWA Order. This rule 

proposes the process under which 

States would develop and implement 

asset management plans, which is a 

document describing how the highway 

network system will be managed, in a 

financially responsible manner, to 

achieve a desired level of performance 

and condition while managing risks 

over the life cycle of the assets. The 

asset management plan does not lead 

directly to construction. Therefore, the 

FHWA has determined that the 

proposed asset management regulations, 

if finalized, would not cause 

disproportionately high and adverse 

human health and environmental effects 

on minority or low-income populations. 

Executive Order 13045 (Protection of 

Children) 

We have analyzed this rule under EO 

13045, Protection of Children from 

Environmental Health Risks and Safety 

Risks. The FHWA certifies that this 

action would not cause an 

environmental risk to health or safety 

that might disproportionately affect 

children. 

Executive Order 13175 (Tribal 

Consultation) 

The FHWA has analyzed this action 

under EO 13175, Consultation and 

Coordination with Indian Tribal 

Governments, and believes that the 

proposed action would not have 

substantial direct effects on one or more 

Indian tribes; would not impose 

substantial direct compliance costs on 

Indian tribal governments; and would 

not preempt tribal laws. The proposed 

rulemaking addresses obligations of 

Federal funds to States for Federal-aid 

highway projects and would not impose 

any direct compliance requirements on 

Indian tribal governments. Therefore, a 

tribal summary impact statement is not 

required. 

Executive Order 13211 (Energy Effects) 

The FHWA has analyzed this action 

under EO 13211, Actions Concerning 

Regulations That Significantly Affect 

Energy Supply, Distribution, or Use. The 

FHWA has determined that this is not 

a significant energy action under that 

order since it is not a significant 

regulatory action under EO 12866 and is 

not likely to have a significant adverse 

effect on the supply, distribution, or use 

of energy. Therefore, a Statement of 

Energy Effects is not required. 

Regulation Identification Number 

An RIN is assigned to each regulatory 

action listed in the Unified Agenda of 

Federal Regulations. The Regulatory 

Information Service Center publishes 

the Unified Agenda in April and 

October of each year. The RIN number 

contained in the heading of this 

document can be used to cross-reference 

this action with the Unified Agenda. 


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List of Subjects in 23 CFR Part 515 

Asset management, Transportation, 

Highways and roads. 

Issued on February 10, 2015, under 

authority delegated in 49 CFR 1.85(a)(1). 

Gregory G. Nadeau, 

Acting Administrator, Federal Highway 

Administration. 

In consideration of the foregoing, the 

FHWA proposes to revise title 23, Code 

of Federal Regulations, by adding a new 

part 515 to read as follows: 

PART 515—ASSET MANAGEMENT 

PLAN 

Sec. 

515.001 Purpose. 

515.003 Applicability. 

515.005 Definitions. 

515.007 Process for establishing the asset 

management plan. 

515.009 Asset management plan 

requirements. 

515.011 Phase-in of asset management plan 

development. 

515.013 Process certification and plan 

consistency review. 

515.015 Penalties. 

515.017 Organizational integration of asset 

management. 

515.019 Periodic evaluations of facilities 

requiring repair or reconstruction due to 

emergency events. 

Authority: Sec. 1106, 1203, and 1315(b) of 

Pub. L. 112–141, 126 Stat. 405; 23 U.S.C. 109, 

119(e), 144, 150(c), and 315; 49 CFR 1.85(a). 

§ 515.001 Purpose. 

The purpose of this part is to: 

(a) Establish the processes that a State 

transportation department (State DOT) 

must use to develop its asset 

management plan, as required under 23 

U.S.C. 119(e)(8); 

(b) Establish the minimum 

requirements that apply to the 

development of an asset management 

plan; 

(c) set forth the minimum standards 

for a State DOT to use in developing and 

operating highway bridge and pavement 

management systems under 23 U.S.C. 

150(c)(3)(A)(i); 

(d) Describe the penalties for a State 

DOT’s failure to develop and implement 

an asset management plan in 

accordance with 23 U.S.C. 119 and this 

part; and 

(e) Establish the requirement for State 

DOTs to conduct periodic evaluations to 

determine if reasonable alternatives 

exist to roads, highways, or bridges that 

repeatedly require repair and 

reconstruction activities from 

emergency events. 

§ 515.003 Applicability. 

This part applies to all State DOTs. 

§ 515.005 Definitions. 

As used in this part: 

Asset means all physical highway 

infrastructure located within the rightof-way corridor of a highway. The term 

asset includes all components necessary 

for the operation of a highway including 

pavements, highway bridges, tunnels, 

signs, ancillary structures, and other 

physical components of a highway. 

Asset condition means the actual 

physical condition of an asset in 

relation to the expected or desired 

physical condition of the asset. 

Asset management means a strategic 

and systematic process of operating, 

maintaining, and improving physical 

assets, with a focus on both engineering 

and economic analysis based upon 

quality information, to identify a 

structured sequence of maintenance, 

preservation, repair, rehabilitation, and 

replacement actions that will achieve 

and sustain a desired state of good 

repair over the life cycle of the assets at 

minimum practicable cost. Replacement 

actions may include, but are not limited 

to, initial construction, reconstruction, 

resurfacing, and upgrade activities. 

Asset management plan means a 

document that describes how a State 

DOT will carry out asset management as 

defined in this section. This includes 

how the State DOT will make risk-based 

decisions from a long-term assessment 

of the National Highway System (NHS), 

and other public roads included in the 

plan at the option of the State DOT, as 

it relates to managing its physical assets 

and laying out a set of investment 

strategies to address the condition and 

system performance gaps. This 

document describes how the highway 

network system will be managed to 

achieve a desired level of condition and 

performance while managing the risks, 

in a financially responsible manner, at 

a minimum practicable cost over the life 

cycle of its assets. The term asset 

management plan under this part is the 

risk-based asset management plan that 

is required under 23 U.S.C. 119(e) and 

is intended to carry out asset 

management as defined in 23 U.S.C. 

101(a)(2). 

Bridge as used in this part, is defined 

in 23 CFR 650.305, the National Bridge 

Inspection Standards. 

Investment strategy means a set of 

strategies that result from evaluating 

various levels of funding to achieve a 

desired level of condition to achieve 

and sustain a state of good repair and 

system performance at a minimum 

practicable cost while managing risks. 

Life-cycle cost means the cost of 

managing an asset class or asset subgroup for its whole life, from initial 

construction to the end of its service 

life. 

Life-cycle cost analysis means a 

process to estimate the cost of managing 

an asset class, or asset sub-group over its 

whole life with consideration for 

minimizing cost while preserving or 

improving the condition. 

Performance of the NHS refers to the 

effectiveness of the NHS in providing 

for the safe and efficient movement of 

people and goods where that 

performance can be affected by physical 

assets. This term does not include the 

performance measures established for 

performance of the Interstate System 

and performance of the NHS (excluding 

the Interstate System) under 23 U.S.C. 

150(c)(3)(ii)(A)(IV)–(V). 

Performance gap means the gap 

between the current condition of an 

asset, asset class, or asset sub-group, and 

the targets the State DOT establishes for 

condition of the asset, asset class, or 

asset sub-group. It also means the gap 

between the current performance and 

desired performance of the NHS that 

can only be achieved through improving 

the physical assets. 

Risk means the positive or negative 

effects of uncertainty or variability upon 

agency objectives. 

Risk management means the 

processes and framework for managing 

potential risks, including identifying, 

analyzing, evaluating, and addressing 

the risks to assets and system 

performance. 

Statewide Transportation 

Improvement Program (STIP) has the 

same meaning as defined in § 450.104 of 

this title. 

Work type means maintenance, 

preservation, repair, rehabilitation, and 

replacement, as well as initial 

construction, reconstruction, 

resurfacing, and upgrade. 

§ 515.007 Process for establishing the 

asset management plan. 

(a) A State shall develop a risk-based 

asset management plan that describes 

how the highway network system, 

including the NHS, will be managed to 

achieve a desired level of condition and 

performance while managing the risks, 

in a financially responsible manner, at 

a minimum practicable cost over the life 

cycle of its assets. The State DOT shall 

develop and use, at a minimum the 

following processes to prepare its asset 

management plan: 

(1) A State DOT shall establish a 

process for conducting performance gap 

analysis to identify deficiencies 

hindering progress toward improving 

and preserving the NHS and achieving 

and sustaining the desired state of good 

repair. At a minimum, the State DOT 


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shall address the following in the gap 

analysis: 

(i) The performance targets for the 

condition of Interstate highway 

pavements, non-Interstate NHS highway 

pavements, and NHS bridges as 

established by the State DOT under 23 

U.S.C. 150(d) once promulgated. If a 

State DOT decides to include other 

public roads in the asset management 

plan, then the desired performance 

targets for those public roads shall be 

included as well; 

(ii) The gaps, if any, in the 

effectiveness of the NHS in providing 

for the safe and efficient movement of 

people and goods where it can be 

affected by physical assets; 

(iii) The gaps, if any, between the 

existing condition of the assets, asset 

classes, or asset sub-groups and the 

State DOT’s performance targets; and 

(iv) Alternative strategies to close or 

address the identified gaps. 

(2) A State DOT shall establish a 

process for conducting life-cycle cost 

analysis for an asset class (i.e., a group 

of assets with the same characteristics 

and function) or asset sub-group (i.e., a 

group of assets within an asset class 

with the same characteristics and 

function) at the network level (network 

to be defined by the State DOT). As a 

State DOT develops the life-cycle cost 

analysis, the State DOT should include 

future changes in demand; information 

on current and future environmental 

conditions including extreme weather 

events, climate change, and seismic 

activity; and other factors that could 

impact whole of life costs of assets. The 

State DOT may propose excluding one 

or more asset sub-groups from its lifecycle cost analysis if the State DOT can 

demonstrate to FHWA the exclusion of 

the sub-group would have no material 

adverse effect on the development of 

sound investment strategies due to the 

limited number of assets in the subgroup, the level of cost impacts 

associated with managing the assets in 

the sub-group, or other supportable 

grounds. A life-cycle cost analysis 

process shall, at a minimum, include 

the following: 

(i) Desired condition for each asset 

class or asset sub-group; 

(ii) Identification of deterioration 

models for each asset class or asset subgroup; 

(iii) Potential work types, including 

the treatment options for the work 

types, across the whole life of each asset 

class or asset sub-group with their 

relative unit cost; and 

(iv) A strategy for managing each asset 

class or asset sub-group by minimizing 

its life-cycle costs, while achieving the 

performance targets set by the State 

DOT for the condition of Interstate 

highway pavements, non-Interstate NHS 

highway pavements, and NHS bridges 

under 23 U.S.C. 150(d). 

(3) A State DOT shall establish a 

process for developing a risk 

management plan. 

This process shall, at a minimum, 

produce the following information: 

(i) Identification of risks that can 

affect the NHS condition and 

effectiveness as they relate to the safe 

and efficient movement of people and 

goods, including risks associated with 

current and future environmental 

conditions, such as extreme weather 

events, climate change, seismic activity, 

and risks related to recurring damage 

and costs as identified through the 

evaluation carried out under § 515.019; 

(ii) An assessment of the identified 

risks to assets and the highway system 

included in the plan in terms of the 

likelihood of their occurrence and their 

impact and consequence if they do 

occur; 

(iii) An evaluation and prioritization 

of the identified risks; 

(iv) A mitigation plan for addressing 

the top priority risks; 

(v) An approach for monitoring the 

top priority risks; and 

(vi) A summary of the evaluations 

carried out under § 515.019 that 

discusses, as a minimum, the results 

relating to the State’s existing 

pavements and bridges on the NHS, and 

any other pavement or bridge included 

in the asset management plan at the 

option of the State DOT. 

(4) A State DOT shall establish a 

process for the development of a 

financial plan that identifies annual 

costs over a minimum period of 10 

years. The financial plan shall, at a 

minimum, include: 

(i) The estimated cost of expected 

future work to implement investment 

strategies contained in the asset 

management plan, by State fiscal year 

and work type; 

(ii) The estimated funding levels that 

are expected to be reasonably available, 

by fiscal year, to address the costs of 

future work types. State DOTs may 

estimate the amount of available 

funding using historical values where 

the future funding amount is uncertain; 

(iii) Identification of anticipated 

funding sources; and 

(iv) An estimate of the value of the 

agency’s pavements and bridge assets 

and the needed investment on an 

annual basis to maintain the value of 

these assets. 

(5) A State DOT shall establish a 

process for developing investment 

strategies meeting the requirements in 

§ 515.009(f). This process must describe 

how the investment strategies are 

influenced, at a minimum, by the 

following: 

(i) Performance gap analysis required 

under paragraph (a)(1) of this section; 

(ii) Life-cycle cost analysis for asset 

classes or asset sub-groups resulting 

from the process required under 

paragraph (a)(2) of this section; 

(iii) Risk management analysis 

resulting from the process required 

under paragraph (a)(3) of this section; 

and 

(iv) Anticipated available funding and 

estimated cost of expected future work 

types associated with various candidate 

strategies based on the financial plan 

required by paragraph (a)(4) of this 

section. 

(b) Each State DOT shall use bridge 

and pavement management systems to 

analyze the condition of Interstate 

highway pavements, non-Interstate NHS 

pavements, and NHS bridges in 

accordance with 23 U.S.C. 

150(c)(3)(A)(i), for the purpose of 

developing and implementing the asset 

management plan required under this 

part. These bridge and pavement 

management systems shall include, at a 

minimum, formal procedures for: 

(1) Collecting, processing, storing, and 

updating inventory and condition data 

for all NHS bridge and pavement assets; 

(2) Forecasting deterioration for all 

NHS bridge and pavement assets; 

(3) Determining the life-cycle benefitcost analysis of alternative strategies 

(including a no action decision) for 

managing the condition of all NHS 

bridge and pavement assets; 

(4) Identifying short- and long-term 

budget needs for managing the 

condition of all NHS bridge and 

pavement assets; 

(5) Determining the optimal strategies 

for identifying potential projects for 

managing pavements and bridges; and 

(6) Recommending programs and 

implementation schedules to manage 

the condition of all Interstate highway 

pavements, non-Interstate NHS highway 

pavements, and NHS bridge assets 

within policy and budget constraints. 

(c) The head of the State DOT shall 

approve the asset management plan. 

§ 515.009 Asset management plan 

requirements. 

(a) A State DOT shall develop and 

implement an asset management plan to 

improve or preserve the condition of the 

assets and improve the performance of 

the NHS in accordance with the 

requirements of this part. If the State 

DOT elects to include other public roads 

in its plan, all asset management 

process and plan requirements in this 

part shall apply. Asset management 


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plans must describe how the State DOT 

will carry out asset management as 

defined in § 515.005. 

(b) An asset management plan shall 

include, at a minimum, a summary 

listing of each of the following assets, 

regardless of ownership: 

(1) Pavements on the Interstate 

System; 

(2) Pavements on the NHS (excluding 

the Interstate System); and 

(3) Bridges on the NHS. 

(c) In addition to the assets specified 

in paragraph (b) of this section, State 

DOTs are encouraged, but not required, 

to include all other NHS infrastructure 

assets within the right-of-way corridor. 

Examples of other assets include 

tunnels, ancillary structures, and signs. 

If a State DOT decides to include other 

such assets on the NHS in its asset 

management plan, or to include assets 

on other public roads, the State DOT 

shall evaluate and manage those assets 

consistent with the provisions of this 

part. 

(d) The minimum content for an asset 

management plan under this part 

includes a discussion of each element in 

this paragraph (d). 

(1) Asset management objectives. The 

objectives should align with the 

agency’s mission. The objectives must 

be consistent with the purpose of asset 

management, which is to achieve and 

sustain the desired state of good repair 

over the life cycle of the assets at a 

minimum practicable cost. 

(2) Asset management measures and 

targets, including those established 

pursuant to 23 U.S.C. 150 for pavements 

and bridges on the NHS. The plan must 

include measures and associated targets 

the State DOT can use in assessing the 

condition of the assets and performance 

of the highway system as it relates to 

those assets. The measures and targets 

must be consistent with the objective of 

achieving and sustaining the desired 

state of good repair. The State DOT must 

include the measures established under 

23 U.S.C. 150(c)(3)(A)(ii)(I)–(III), once 

promulgated in 23 CFR part 490, for the 

condition of pavements on the Interstate 

System, the condition of pavements on 

the NHS (excluding the Interstate), and 

the condition of bridges on the NHS. 

The State DOT also must include the 

targets the State DOT has established for 

the measures required by 23 U.S.C. 

150(c)(3)(A)(ii)(I)–(III), once 

promulgated, and report on such targets 

in accordance with 23 CFR part 490. 

The State DOT’s process may permit the 

inclusion of measures and targets for the 

NHS that the State DOT established 

through pre-existing management efforts 

or develops through new efforts if the 

State DOT wishes to use such additional 

measures and targets to supplement 

information derived from the measures 

and targets required under 23 U.S.C. 

150. 

(3) A summary listing of the Interstate 

pavement assets, non-Interstate NHS 

pavement assets, and NHS bridge assets, 

including a description of the condition 

of those assets, regardless of ownership 

of the pavement and bridge assets. The 

summary listing must include a 

description of the condition of those 

assets based on the performance 

measures established under 23 U.S.C. 

150(c)(3)(A)(ii) for condition, once 

promulgated. If a State DOT decides to 

include other public roads in the asset 

management plan, the State DOT should 

include a summary listing of these 

assets as well, including a description of 

the condition of those assets. Where 

applicable, the description of condition 

should be informed by the evaluation 

required under § 515.019. The processes 

established by State DOTs shall include 

a provision for the State DOT to obtain 

necessary data from other NHS owners 

in a collaborative and coordinated effort 

(4) Performance gap identification. 

(5) Life-cycle cost analysis. 

(6) Risk management analysis, 

including the results of the periodic 

evaluations under § 515.019 for assets 

included in the plan. 

(7) Financial plan. 

(8) Investment strategies. 

(e) An asset management plan shall 

cover, at a minimum, a 10-year period. 

(f) An asset management plan shall 

establish and discuss a set of investment 

strategies leading to a program of 

projects that would 

(1) Achieve and sustain a desired state 

of good repair over the life cycle of the 

assets, 

(2) Improve or preserve the condition 

of the assets and the performance of the 

NHS relating to physical assets, 

(3) Make progress toward 

achievement of the State targets for asset 

condition and performance of the NHS 

in accordance with 23 U.S.C. 150(d), 

and 

(4) Support progress toward the 

achievement of the national goals 

identified in 23 U.S.C. 150(b). 

(g) A State DOT must include in its 

plan a description of how the analyses 

required under § 515.007 support the 

State DOT’s strategies. The plan also 

must describe how the strategies satisfy 

the requirements in paragraph (f)(1) 

through (4) of this section. 

(h) A State DOT should select such 

projects for inclusion in the STIP to 

support its efforts to achieve the goals 

in paragraphs (f)(1) through (4) of this 

section. 

(i) A State DOT is required to make 

its asset management plan available to 

the public, and is encouraged to do so 

in a format that is easily accessible. 

(j) Inclusion of performance measures 

and State DOT targets established 

pursuant to 23 U.S.C. 150 in the asset 

management plan does not relieve the 

State DOT of any performance 

management requirements, including 23 

U.S.C. 150(e) reporting, established in 

other parts of this title. 

§ 515.011 Phase-in of asset management 

plan development. 

(a) A State DOT may choose a phasein option for the development of its 

initial asset management plan, which 

must be submitted to FHWA by [date 1 

year after effective date of final rule] as 

provided in § 515.013(a). A State DOT 

may elect to submit its initial plan by 

following the requirements in this 

section. 

(b) The initial plan shall describe the 

State DOT’s processes for developing its 

risk-based asset management plan, 

including the policies, procedures, 

documentation, and implementation 

approach that satisfy the requirements 

of this part. The plan also must contain 

measures and targets for assets covered 

by the plan. For other parts of the initial 

plan, the State DOT shall use the best 

available information to meet the 

requirements of §§ 515.007 and 515.009. 

The investment strategies required by 

§ 515.007(a)(8) must support progress 

toward the achievement of the national 

goals identified in 23 U.S.C. 150(b), but 

are not required to address the State’s 23 

U.S.C. 150(d) targets for asset condition 

and performance of the NHS unless the 

State DOT has established those targets 

at least 6 months before the plan 

submission deadline in § 515.013(a). 

The initial asset management plan may 

exclude one or more of the necessary 

analyses with respect to the following 

required asset management processes: 

(1) Life-cycle cost analysis required 

under § 515.007(a)(5); 

(2) The risk management analysis 

required under § 515.007(a)(6); and 

(3) Financial plan under 

§ 515.007(a)(7). 

(c) Not later than 18 months after the 

effective date of the final rulemaking for 

pavement and bridge condition 

measures pursuant to 23 U.S.C. 150, a 

State DOT that used the phase-in option 

under this section for its initial plan 

submission shall amend its asset 

management plan to include analyses 

performed using FHWA-certified 

processes and the section 150 measures 

and State DOT targets for pavements 

and bridges on the NHS. The FHWA 

may extend the 18-month time period as 


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needed to provide 12 months between 

the time FHWA certifies the State DOT’s 

processes under 23 U.S.C. 119(e)(6)(A) 

and the date the amended plan is due 

to give the State DOT adequate time to 

incorporate section 150 measures and 

targets and complete the required 

§ 515.007 analyses using FHWAcertified processes. To qualify for an 

extension, the State DOT’s initial plan 

must meet the initial plan requirements 

in § 515.011. The State DOT shall 

submit its amended plan in accordance 

with the provisions in § 515.013(d). The 

amended plan must meet all 

requirements in §§ 515.007 and 515.009. 

This includes investment strategies that 

are developed based on the analyses 

from all processes required under 

§ 515.007, and meet the requirements in 

23 U.S.C. 119(e)(2). 

§ 515.013 Process certification and plan 

consistency review. 

(a) Plan deadline. Not later than [date 

1 year after effective date of final rule], 

the State DOT shall submit a Stateapproved asset management plan to the 

FHWA. 

(b) Certification of Processes under 23 

U.S.C. 119(e)(6). The FHWA will treat 

the State DOT’s submission of a Stateapproved asset management plan as a 

request for certification of the State’s 

DOT’s plan development processes 

under 23 U.S.C. 119(e)(6). No later than 

90 days after the date on which the 

FHWA receives the State DOT’s 

documentation, the FHWA shall decide 

whether the State DOT’s processes for 

developing its asset management plan 

meet the requirements of this part. 

(1) If FHWA determines that the 

processes used by a State DOT to 

develop and maintain the asset 

management plan do not meet the 

requirements established under this 

part, FHWA will send the State DOT a 

written notice of the denial of 

certification or recertification, including 

a listing of the specific requirement 

deficiencies. 

(2) Upon receiving a notice of denial 

of certification or recertification, the 

State DOT shall have 90 days from 

receipt of the notice to address the 

requirement deficiencies identified in 

the notice and resubmit the State DOT’s 

processes to FHWA for review and 

certification. 

(3) The FHWA may extend the State 

DOT’s 90-day period to cure 

deficiencies upon request. 

(4) If FHWA finds that a State DOT’s 

asset management processes 

substantially meet the requirements of 

this part except for minor deficiencies, 

FHWA may certify or recertify the State 

DOT’s processes as being in compliance, 

but the State DOT must take actions to 

correct the minor deficiencies within 90 

days of receipt of the notification of 

certification. The FHWA may extend 

this 90-day period upon request of the 

State DOT. The State shall notify 

FHWA, in writing, when corrective 

actions are completed. 

(c) Determination of consistency 

under 23 U.S.C. 119(e)(5). Beginning 

with the first fiscal year following 

[effective date of final rule] and in each 

year thereafter, FHWA will determine 

not later than August 31 whether the 

State DOT has developed and 

implemented an asset management plan 

consistent with 23 U.S.C. 119. In 

making the annual consistency 

determination, the FHWA will consider 

the most recent asset management plan 

submitted by the State DOT, as well as 

any documentation submitted by the 

State DOT to demonstrate 

implementation of the plan. The FHWA 

will review a State DOT’s asset 

management plan to ensure that it was 

developed with the processes certified 

under this section and is consistent with 

other applicable requirements in this 

part. The State DOT’s plan is not 

otherwise subject to FHWA approval. 

The FHWA may determine an initial 

plan is consistent with 23 U.S.C. 119 

and the requirements of this part if it is 

submitted by the deadline in paragraph 

(a) of this section and complies with 

§ 515.011. 

(d) Plan updates, amendments, and 

recertification of State DOT processes. A 

State DOT shall update and resubmit its 

asset management plan to the FHWA for 

a new process certification on October 

1 every 4 years following the year of 

initial certification of the State DOT’s 

processes. Whenever the State DOT 

amends its asset management plan, it 

must submit the amended plan to the 

FHWA for a new process certification 

and consistency determination at least 

30 days prior to the deadline for the 

next FHWA consistency determination 

under paragraph (c) of this section. 

Minor technical corrections and 

revisions with no foreseeable material 

impact on the accuracy and validity of 

the analyses and investment strategies 

in the plan do not require submission to 

FHWA. 

§ 515.015 Penalties. 

(a) Beginning with the second fiscal 

year after [effective date of final rule] 

and in each fiscal year thereafter, if a 

State DOT has not developed and 

implemented an asset management plan 

consistent with the requirements of 23 

U.S.C. 119 and this part, the maximum 

Federal share for National Highway 

Performance Program projects shall be 

reduced to 65 percent for that fiscal 

year. 

(b)(1) Except as provided in paragraph 

(b)(2) of this section, if the State DOT 

has not developed and implemented an 

asset management plan that is 

consistent with the requirements of 23 

U.S.C. 119 and this part and established 

the performance targets required under 

23 U.S.C. 150(d) regarding the condition 

and performance of the NHS by the date 

that is 18 months after the effective date 

of the final rule required under 23 

U.S.C. 150(c), the FHWA will not 

approve any further projects using 

National Highway Performance Program 

funds. 

(2) The FHWA may extend the 18- 

month period if FHWA determines that 

the State DOT has made a good faith 

effort to develop and implement an 

asset management plan and establish 

the required performance targets. 

§ 515.017 Organizational integration of 

asset management. 

(a) The purpose of this section is to 

describe how a State DOT may integrate 

asset management into its organizational 

mission, culture and capabilities at all 

levels. 

(b) A State DOT should establish 

organizational strategic goals and 

include the goals in its organizational 

strategic implementation plans with an 

explanation as to how asset 

management will help it to achieve 

those goals. 

(c) A State DOT should conduct a 

periodic self-assessment of the agency’s 

capabilities to conduct asset 

management, as well as its current 

efforts in implementing an asset 

management plan. The self-assessment 

should consider, at a minimum, the 

adequacy of the State DOT’s strategic 

goals and policies with respect to asset 

management, whether asset 

management is considered in the 

agency’s planning and programming of 

resources, including development of the 

STIP; whether the agency is 

implementing appropriate program 

delivery processes, such as 

consideration of alternative project 

delivery mechanisms, effective program 

management, and cost tracking and 

estimating; and whether the agency is 

implementing adequate data collection 

and analysis policies to support an 

effective asset management program. 

(d) Based on the results of the selfassessment, the State DOT should 

conduct a gap analysis to determine 

which areas of its asset management 

process require improvement. In 

conducting a gap analysis, the State 

DOT should: 


Rmajette on DSK2VPTVN1PROD with PROPOSALS
Federal Register / Vol. 80, No. 34 / Friday, February 20, 2015 / Proposed Rules 9253 

(1) Determine the level of 

organizational performance effort 

needed to achieve the objectives of asset 

management; 

(2) Determine the performance gaps 

between the existing level of 

performance effort and the needed level 

of performance effort; and 

(3) Develop strategies to close the 

identified organizational performance 

gaps and define the period of time over 

which the gap is to be closed. 

§ 515.019 Periodic evaluations of facilities 

requiring repair or reconstruction due to 

emergency events. 

(a) A State DOT shall conduct a 

statewide evaluation of the State’s 

existing roads, highways, and bridges 

eligible for funding under title 23, 

United States Code, that have required 

repair and reconstruction activities on 

two or more occasions due to emergency 

events, to determine if there are 

reasonable alternatives to any of these 

roads, highways, and bridges. The 

evaluation shall consider the risk of 

recurring damage and cost of future 

repair under current and future 

environmental conditions. For purposes 

of this section, ‘‘emergency event’’ 

means a natural disaster or catastrophic 

failure due to external causes resulting 

in an emergency declared by the 

Governor of the State or an emergency 

or disaster declared by the President of 

the United States. 

(b) For purposes of this section, 

reasonable alternatives include work 

types that could achieve the following: 

(1) Reduce the need for Federal funds 

to be expended on emergency repair and 

reconstruction activities; 

(2) Better protect public safety and 

health and the human and natural 

environment; and 

(3) Meet transportation needs as 

described in the relevant and applicable 

Federal, State, local, and tribal plans 

and programs. Relevant and applicable 

plans and programs include the LongRange Statewide Transportation Plan, 

STIP, Metropolitan Transportation Plan, 

and Transportation Improvement 

Program that are developed under part 

450 of this title. 

(c) Not later than [date 2 years after 

effective date of final rule], the State 

DOT must complete the evaluation for 

NHS highways and bridges and any 

other assets included in the State DOT’s 

asset management plan. The State DOT 

must complete the evaluation for all 

other roads, highways, and bridges 

meeting the criteria for evaluation not 

later than [date 4 years after effective 

date of final rule], excluding federallyowned facilities. The State DOT shall 

update the evaluation after every 

emergency event to the extent needed to 

include facilities affected by the event. 

The State will review and update the 

evaluation at least every four years after 

the initial evaluation. In establishing its 

evaluation cycle, the State DOT should 

consider how the evaluation can best 

inform the State DOT’s preparation of 

its asset management plan and STIP. 

(d) The State DOT shall include in its 

asset management plan developed 

pursuant to §§ 515.007 and 515.009, a 

summary of the evaluation for any 

roads, highways, and bridges included 

in the asset management plan. The 

results of the evaluation of those assets, 

including any update following an 

emergency event, shall be addressed in 

the asset management plan’s risk 

analysis as provided in § 515.007(a)(6). 

(e) The State DOT must make the 

evaluation available to the FHWA upon 

request. 

[FR Doc. 2015–03167 Filed 2–19–15; 8:45 am] 

BILLING CODE 4910–22–P 

DEPARTMENT OF HOUSING AND 

URBAN DEVELOPMENT 

24 CFR Parts 203, 207, 220, 221, 232, 

235, 236 and 241 

[Docket No. FR–5805–P–01] 

RIN 2502–AJ26 

Federal Housing Administration (FHA): 

Standardizing Method of Payment for 

FHA Insurance Claims 

AGENCY: Office of the Assistant 

Secretary for Housing-Federal Housing 

Commissioner, HUD. 

ACTION: Proposed rule. 

SUMMARY: This proposed rule is a costsavings measure to update HUD’s 

regulations regarding the payment of 

FHA insurance claims in debentures. 

Section 520(a) of the National Housing 

Act affords the Secretary discretion to 

pay insurance claims in cash or 

debentures. Although HUD has given 

mortgagees the option to elect payment 

of FHA insurance claims in debentures 

in some sections of HUD’s regulations, 

HUD has not paid an FHA insurance 

claim under these regulations using 

debentures in approximately 5 years. 

This proposed rule would amend 

applicable FHA regulations to bring 

consistency in determining the method 

of payment for FHA insurance claims. 

DATES: Comment Due Date: April 21, 

2015. 

ADDRESSES: Interested persons are 

invited to submit comments regarding 

this proposed rule to the Regulations 

Division, Office of General Counsel, 

Department of Housing and Urban 

Development, 451 7th Street SW., Room 

10276, Washington, DC 20410–0500. 

Communications must refer to the above 

docket number and title. There are two 

methods for submitting public 

comments. All submissions must refer 

to the above docket number and title. 

1. Submission of Comments by Mail. 

Comments may be submitted by mail to 

the Regulations Division, Office of 

General Counsel, Department of 

Housing and Urban Development, 451 

7th Street SW., Room 10276, 

Washington, DC 20410–0500. 

2. Electronic Submission of 

Comments. Interested persons may 

submit comments electronically through 

the Federal eRulemaking Portal at 

www.regulations.gov. HUD strongly 

encourages commenters to submit 

comments electronically. Electronic 

submission of comments allows the 

commenter maximum time to prepare 

and submit a comment, ensures timely 

receipt by HUD, and enables HUD to 

make them immediately available to the 

public. Comments submitted 

electronically through the 

www.regulations.gov Web site can be 

viewed by other commenters and 

interested members of the public. 

Commenters should follow the 

instructions provided on that site to 

submit comments electronically. 

Note: To receive consideration as public 

comments, comments must be submitted 

through one of the two methods specified 

above. Again, all submissions must refer to 

the docket number and title of the rule. 

No Facsimile Comments. Facsimile 

(fax) comments are not acceptable. 

Public Inspection of Public 

Comments. HUD will make all properly 

submitted comments and 

communications available for public 

inspection and copying between 8 a.m. 

and 5 p.m. weekdays at the above 

address. Due to security measures at the 

HUD Headquarters building, you must 

schedule an appointment in advance to 

review the public comments by calling 

the Regulations Division at 202–708– 

3055 (this is not a toll-free number). 

Individuals with speech or hearing 

impairments may access this number 

via TTY by calling the toll-free Federal 

Relay Service at 800–877–8339. Copies 

of all comments submitted are available 

for inspection and downloading at 

www.regulations.gov. 

FOR FURTHER INFORMATION CONTACT: For 

information about: HUD’s Single Family 

Housing program, contact Ivery Himes, 

Director, Office of Single Family Asset 

Management, Office of Housing, 

Department of Housing and Urban 


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