12266 Federal Register / Vol. 62, No. 50 / Friday, March 14, 1997 / Notices

be mailed or delivered to Mr. Robert J.

Kemp, New Hanover County Airport

Authority at the following address: Mr.

Robert J. Kemp, Airport Director, New

Hanover County Airport Authority,

1740 Airport Boulevard, Wilmington,

NC 28405.

Air carriers and foreign air carriers

may submit copies of written comments

previously provided to the New

Hanover County Airport Authority

under section 158.23 of Part 158.

FOR FURTHER INFORMATION CONTACT:

Terry R. Washington, Program Manager,

Atlanta Airports District Office, 1701

Columbia Avenue, Suite 2–260, College

Park, GA 30337–2747, Telephone No.

(404) 305–7143.

The application may be reviewed in

person at this same location.

SUPPLEMENTARY INFORMATION: The FAA

proposes to rule and invites public

comment on the application to use the

revenue from a PFC at New Hanover

International Airport under the

provisions of the Aviation Safety and

Capacity Expansion Act of 1990 (Title

IX of the Omnibus Budget

Reconciliation Act of 1990) (Pub. L.

101–508) and Part 158 of the Federal

Aviation Regulations (14 CFR Part 158).

On February 27, 1997, the FAA

determined that the application to use

the revenue from a PFC submitted by

New Hanover County Airport Authority

was substantially complete within the

requirements of section 158.25 of Part

158. The FAA will approve or

disapprove the application, in whole or

in part, no later than May 28, 1997.

The following is a brief overview of

the application.

Level of the proposed PFC: $3.00.

Charge effective date: February 1,

1994.

Charge expiration date: January 31,

1997.

Total PFC revenue collected:

$410,546.

Application number: 97–02–U–00–

ILM.

Brief description of proposed

project(s):

1. Medium Intensity Taxiway Lighting

Rehabilitation

2. Acquire Ramp Sweeper

3. Precision Path Indicator Runway 35

4. Reconstruct/Widen Taxiways A&H,

and Construct Exit Taxiways for

Runway 6–24

5. Install fencing & Security Road

Class or classes of air carriers which

the public agency did not require to

collect PFCs: On demand air taxi/

commercial operator filing FAA form

18–31 enplaning less than 150

passengers per year at New Hanover

International Airport.

Any person may inspect the

application in person at the FAA office

listed above under FOR FURTHER

INFORMATION CONTACT. In addition, any

person may, upon request, inspect the

application, notice and other documents

germane to the application in person at

the New Hanover County Airport

Authority.

Issued in Atlanta, Georgia on March 7,

1997.

Dell T. Jernigan,

Manager, Atlanta Airports District Office

Southern Region.

[FR Doc. 97–6527 Filed 3–13–97; 8:45 am]

BILLING CODE 4910–13–M

Federal Transit Administration

Policy on Transit Joint Development

AGENCY: Federal Transit Administration

(FTA), U.S. Department of

Transportation.

SUMMARY: FTA is revising and clarifying

its Joint Development policies with

respect to program income in relation to

real estate acquired with funds under

Federal transit law, 49 U.S.C. 5301 et

seq. This Notice supplements the

guidance contained in Appendix B of

FTA Circular 9300.1 ‘‘Joint

Development Projects.’’ All joint

development projects undertaken in

conformance with this policy will be

considered ‘‘mass transportation

projects’’ eligible for funding under FTA

capital programs. This policy is

applicable to development of properties

acquired under previous grants as well

as new grants, as specified in the FTA

Master Agreement dated October 1,

1996. All such projects must generate a

one-time payment or revenue stream for

transit use, the present value of which

equals or exceeds the fair market value

of the property. In determining the fair

market value, FTA will consider

appraisal methods which factor in the

‘‘highest and best transit use’’ of the

property as defined in the body of this

notice. Where the grantee retains

continuing control and use of the joint

development for mass transportation

purposes, all proceeds will be

considered program income. Proposals

that meet the criteria described below

may be submitted at any time to the

appropriate FTA regional office, listed

in Attachment A.

DATES: Effective March 14, 1997.

FOR FURTHER INFORMATION CONTACT:

Richard Steinmann, Director, Office of

Policy Development, on (202) 366–4060;

or Paul Marx, Economist, on (202) 366–

1675.

SUPPLEMENTARY INFORMATION:

Introduction

Transit systems have long been

encouraged to undertake joint

development projects in connection

with their rail transit stations. However,

apparent inconsistencies between

transit laws, the Common Grant Rule

and FTA policy may have dissuaded

some transit authorities from initiating

joint development projects. This notice

clarifies the relationship between transit

laws and regulations and FTA policy

regarding property disposition, leases of

property, and sale of property for joint

development. This FTA policy

statement affects primarily the treatment

of program income with regard to joint

development and the definition of

‘‘highest and best transit use’’ in joint

development.

Transit systems are permitted in 49

U.S.C. 5309 (a)(1)—(5) and (7) [former

Section 3(a)(1)(D) of the Federal Transit

Act] to use grant funds to also support

‘‘transportation projects which enhance

the effectiveness of any mass

transportation project and are physically

or functionally related to such mass

transportation project or which create

new or enhanced coordination between

public transportation and other forms of

transportation, either of which enhance

urban economic development or

incorporate private investment

including commercial and residential

development.’’ The Intermodal Surface

Transportation Efficiency Act of 1991

(ISTEA) added Section 3 (a)(1)(F), now

codified at 49 U.S.C. 5309(a)(7), to the

Federal transit laws. This section allows

FTA grant funds to support any ‘‘other

nonvehicular capital improvements that

the Secretary may decide would result

in increased mass transportation usage

in the corridor.’’

FTA is encouraging transit systems to

undertake transit-oriented Joint

Development projects either under new

grants or with property acquired under

previous grants, whether the property is

associated with a rail, bus or other

transit facility. The purpose of this Joint

Development should be both to secure

a revenue stream for the transit system

and to help shape the community that

is being served by the transit system.

Where the grantee retains effective

continuing control over the joint

development for mass transportation

purposes (such as an easement, or a

contractual arrangement), all proceeds

of sale, lease or other incumbrance of

the property will be treated as program

income for use by the transit system to

meet capital and operating needs. This

is a departure from previous policy in

two areas. First, FTA will now define all
Federal Register / Vol. 62, No. 50 / Friday, March 14, 1997 / Notices 12267

1Effective, continuing control of the property for

transit purposes does not substitute for the grantee’s

obligation to ensure ongoing access by the general

public to the transit facility.

2FTA has determined that joint development

authority under section 5309(a) is coextensive with

section 5307.

3Funding for certain grants may have lapsed

which could prevent their reopening should a

change in scope be necessary to carry out transit

oriented joint development.

4FTA realizes that properties supported with

Nonurbanized Area or Elderly and Persons with

Disabilities program funds are unlikely candidates

for joint development. However, FTA wishes to

make it clear that the source of funding is not to

be regarded as an impediment to a joint

development proposal under this policy.

5The proposer must make a convincing case that

the transit-oriented joint development will be more

beneficial to the transit system than an outright sale

of the property for non-transit purposes. For

example, ‘‘Highest and best transit use’’ of a

property for a day care center produces less income

than ‘‘highest and best use’’ as a coin-operated

laundry, but market sureveys show it would attract

and serve a greater number of transit riders and is

better suited to the overall plan for the area. This

would be an appropriate trade-off.

revenue derived from such joint

development to be program income as

defined in the Common Grant Rule at 49

CFR, Subtitle A, § 18.25. Second,

grantees may use the new concept of

‘‘highest and best transit use’’, as an

alternate to ‘‘highest and best use’’, in

valuing real property for transit-oriented

joint development. To accomplish this

change, the FTA Master Agreement has

been expressly modified to include joint

development as an eligible activity in all

capital grants to which it applies.

Further, grantees may request

amendment of grants issued prior to FY

1997, as desired, to expressly include

joint development within the scope of

such grants.

In accordance with this new policy,

transit agencies have three options: they

can sell property as excess for nontransit use; they can lease the property

for incidental, non-interfering use by

others while the property is held for a

future identified transit use; or they can

undertake a transit-oriented joint

development on the property. In the

case of a sale without a continuing

transit use, property disposition rules

under the Common Grant Rule at 49

CFR, Subtitle A, § 18.31 apply. That is,

the pro-rata Federal share of the net

proceeds of a sale at fair market value

are returned to the U.S. Treasury.

Transit-oriented joint development

can be accomplished through a sale or

lease of federally funded property, or

through direct participation of the

transit agency in the development e.g.,

as a general partner, depending upon

the needs of the project. To qualify as

a ‘‘transportation project’’, the transit

agency must retain sufficient continuing

control over the property to ensure its

continued physical or functional

relationship to transit. 1 This control

may be exerted through any number of

legally enforceable contractual

arrangements, ranging from a simple

easement to ensure unimpeded access

between the development and the

transit factility by transit patrons, or

perhaps some form of reverter clause to

take effect in the event access becomes

unreasonably curtailed. Any legally

enforceable arrangement between the

transit system and the developer which

preserves the defined physical or

functional relationship between the

development and the transit facility

should satisfy this requirement. As long

as such control is maintained, the

transit agency may retain all revenues

from such joint development as program

income.

Policy: FTA encourages transit

systems to undertake joint development

projects at and around transit stations,

bus terminals, intermodal facilities and

other transit properties, where such

projects are physically or functionally

related to the provision of transit

service, and where they increase transit

revenues through proceeds from the

joint development. FTA will do this by:

making grants under the authority to

support Joint Development provided by

49 U.S.C. 5307,2 5309 (a) (1)–(5), 5309

(a)(7), and 5309 (f), and by allowing the

proceeds from sale, lease or other

incumbrance of property for transitoriented joint development to be

retained by the transit system for transit

operating and capital expenses.

FTA considers transit-oriented joint

development already to be within the

scope of nearly all capital grants

involving real property unless expressly

prohibited by a special term or

condition of the grant. This is due to a

term in most, if not all, capital grants

requiring the grantee to follow FTA’s

most recent policies and procedures in

administering its grants.

Notwithstanding, FTA will modify

existing grants at the request of the

grantee, when this step is desired to

expressly reflect transit-oriented joint

development in the grant purpose. In

the case of a section 5309 grant made

between 1978 and 1983,3 and certain

section 5307 grants, FTA will review

joint development proposals on a caseby-case basis, and will work with the

grantee to achieve the purposes of this

policy. The FTA Master Agreement

dated October 1, 1996 expressly

includes transit-oriented joint

development as an authorized grant

purpose.

This policy applies to projects funded

under the following transit programs:

Section 5309, Capital; Section 5307,

Urbanized Area Formula; Section 5310,

Elderly and Persons with Disabilities;

and Section 5311, Nonurbanized Area

Program.4

The policy will not affect leases of

real property for non-transit purposes or

disposition of property that is no longer

needed for transit purposes.

Criteria

To be eligible for consideration as a

transit-oriented joint development

project under this policy, the project

must have the following characteristics:

• It includes a transit element; and

• It enhances urban economic

development or incorporates private

investment including office,

commercial, or residential development;

and

• It enhances the effectiveness of a

mass transit project, and the non-transit

element is physically or functionally

related to the mass transit project; or

• it creates new or enhanced

coordination between public transit and

other forms of transportation; or,

• it includes nonvehicular capital

improvements that result in increased

transit usage, in corridors supporting

fixed guideway systems.

Financial criteria that FTA will use in

assessing joint development projects

using land acquired with FTA funds are

as follows:

• It is FTA’s intent that the transit system

be able to negotiate its project benefit

whenever possible, on the basis of the value

added to the property by the planning, design

and construction of transit-oriented joint

development around the transit facility.

Therefore the project shall generate either a

one-time payment or a revenue stream, the

present value of which equals either the

current market value or the appraised value

of the property, taking highest and best

transit use into account.5

• When the joint development project is

one of several being undertaken in a program

of joint development projects, the combined

revenue streams from all of the projects may

be balanced against the cumulative appraised

value of the combined real estate on a

portfolio basis. In such an approach, one

project could be carried forward at a nominal

loss, provided other projects in the same

portfolio produced a proportionally greater

revenue for the transit system, resulting in a

net present value benefit equal to the

appraised value of the property used, taking

highest and best transit use into account.

• As long as the grantee retains effective

continuing control of the joint development

project we do not consider this a disposition

of property. Thus, the grantee may retain all

revenues from the project as program income.

However, if the grantee cedes effective

continuing control of the property for transit
12268 Federal Register / Vol. 62, No. 50 / Friday, March 14, 1997 / Notices

6Within reason, the grantee may also postpone

development of some properties along the corridor,

to enhance their final development value. This

should be declared in the joint development

proposal.

use the grantee could be liable for repayment

of the Federal share of the current market

value of the property.

Local Supportive Actions

While the preceding criteria are

mandatory, the following are factors that

will directly affect the successful

implementation of any transit-oriented

joint development, and warrant

consideration in a joint development

proposal. To ensure a transit-supportive

environment in the community served

by the transit system, FTA encourages

local governments, transportation

agencies, employers, building owners

and managers, and public and private

developers to work together to

implement policies and strategies that

will support transit use in daily

activities. Supportive land use policies

include promoting mixed use and high

density development around transit

facilities. Urban design enhancements

include landscaping, pedestrian and

bicycle amenities, safety and security

improvements, and improved access to

transit services. Transportation

management actions include parking

management strategies to increase the

cost and reduce the number of nontransit parking spaces for single

occupant vehicles, priority treatment for

transit vehicles, and transit pass

programs. Also included would be

activities that extend the hours of

operation of transit facilities and

thereby enhance the perception of safety

in the surrounding areas.

Definitions

Joint Development

Joint development projects are

commercial, residential, industrial, or

mixed use developments that are

undertaken in concert with transit

facilities. They may include private, and

non-profit development activities

usually associated with fixed guideway

(Rail or Busway) transit systems that are

new or being modernized or extended.

Joint development projects may also be

associated with bus facilities,

intermodal transfer facilities (e.g., bus to

rail), transit malls, and Federal, State or

local investments in local facilities

(such as a bus terminal and tourist

facility). FTA funds may be used to

facilitate development that enhances

transit; they may not be used for purely

private development such as

construction and permanent financing

costs related to the design or

construction of purely retail, residential,

or other commercial public and private

revenue-producing facilities.

Highest and Best Transit Use

The highest and best transit use is that

combination of residential, retail,

commercial and parking space that

results in the highest level of transit

support from a combination of project

revenues and increased ridership. The

term is intended to combine the

concepts of highest and best use in real

estate assessment with transit-oriented

development. In some circumstances,

the highest and best use for a property,

i.e., that use resulting in the greatest

cash price for the property, may not be

transit-oriented. Secure storage for

construction equipment, or a coinoperated car wash would be examples of

non-transit-oriented developments. FTA

does not intend to limit the local

community’s ability to define social or

other benefits that it wishes to achieve

through a transit-oriented development.

Thus, locally preferred plans for

‘‘highest and best transit use’’ may be

acceptable even if they do not generate

the highest possible level of financial

return. The Joint Development proposal

will indicate the extent to which the

highest and best transit use value varies

from the traditional highest and best use

assessment, and the basis for this

variation.

Physically or Functionally Related

Each project must establish the link

between transit and the proposed joint

development project. Issues to be

addressed should include travel time

between the joint development and the

transit facility, reasonable access

between the development and the

transit facility, trip generation rates of

the proposed development, and the

transit system’s share of those trips.

Functional relationships should not

extend beyond the distance most people

will reasonably walk to use a transit

service—about 1,500 feet.

Revenue Stream

Research has shown that the siting

and development of transit service adds

to property values near transit stations,

and that collocation of residential,

commercial and retail establishments

with the transit system enhances social

and economic returns for the

community. Therefore, a joint

development project should be planned

to generate revenue for the transit

system from this added value. This

revenue may take the form of a one-time

cash payment for the sale of land, air

rights, or some other form of property

rights. Or it may be a revenue stream

from an installment sale, lease, ground

rent, or other compensation as agreed

between the transit system and the

developer, including but not limited to

in-kind services such as construction or

maintenance. The payment or revenue

stream may be delayed for a time to

support the project purpose, but the

present value of all revenues must equal

the current market value based on the

highest and best transit use.

In the case of a program of joint

development, conducted on a corridor

or system wide level, FTA will evaluate

the revenue stream on a portfolio basis,

requiring that the sum of revenue

streams for all developed properties be

equal to the combined appraised value

of the land used to generate the

revenues, taking into account the

highest and best transit use.6 There may

be instances where the transit system’s

participation in a joint development

project adds value to that project above

the value of the land itself. This

additional value will allow the transit

system to attract development at other,

more ‘‘difficult’’ properties along the

same corridor by making some revenue

concessions on these properties.

As long as the grantee can

demonstrate that it has the ability to

retain effective continuing control of the

joint development for transit use, i.e. its

physical or functional relation to transit,

it may retain any proceeds from the

project as program income. However, if

the grantee cedes effective control over

the property for transit use it may be

liable for reimbursement of the Federal

interest in the property.

Procedures

Joint Development proposals that

meet the criteria in this notice may be

submitted at any time to the appropriate

FTA regional office, listed in attachment

A. They should include, at a minimum,

the Joint Development agreement, a

market and financial assessment of the

Joint Development and its impact on the

transit system, and a statement of the

outcome of planning and coordination

between the Joint Development and the

transit facility. The proposal should

document the projected benefits for the

transit system as well as the effective

continuing control of the Joint

Development project for transit

purposes, as outlined in the definition

section above.

Authority: 49 U.S.C. 5307, 5309(a)(1)–(5),

5309(a)(7), and 5309(f), as well as 49 CFR

Subtitle A.
Federal Register / Vol. 62, No. 50 / Friday, March 14, 1997 / Notices 12269

Issued on March 10, 1997.

Gordon J. Linton,

Administrator.

Attachment A

Listing of FTA Regions:

Region 1

Volpe National Transportation Systems

Center, Kendall Square, 55 Broadway,

Suite 920, Cambridge, MA 02142–1093

Region 2

26 Federal Plaza, Suite 2940, New York, NY

10278–0194

Region 3

1760 Market Street, Suite 500, Philadelphia,

PA 19103–4124

Region 4

Atlanta Federal Center, 100 Alabama Street,

N.W., 17th Floor, Suite T1750, Atlanta, GA

30303

Region 5

55 East Monroe Street, Rm 1415, Chicago, IL

60603–5704

Region 6

Parkview Place, 524 East Lamar Street, Suite

175, Arlington, TX 76011–3900

Region 7

6301 Rockhill Road, Suite 303, Kansas City,

MO 64131–1117

Region 8

Columbine Place, 216 16th Street, Suite 650,

Denver, CO 80202–5120

Region 9

201 Mission Street, Suite 2210, San

Francisco, CA 94105–1831

Region 10

Jackson Federal Building, 915 Second Ave.,

Suite 3142, Seattle, WA 98174–1002.

[FR Doc. 97–6462 Filed 3–13–97; 8:45 am]

BILLING CODE 4910–57–P

National Highway Traffic Safety

Administration

[Docket No. 97–013; Notice 2]

General Motors Corporation; Receipt

of Application for Decision of

Inconsequential Noncompliance;

Correction

AGENCY: National Highway Traffic

Safety Administration, DOT.

ACTION: Correction to a notice.

SUMMARY: The Docket No. 97–113;

Notice 1, as it appeared in the Federal

Register on March 7, 1997, on page

10618 is incorrect. It should appear as

Docket 97–013; Notice 1.

Authority: 49 U.S.C. 30118, 30120;

delegation of authority at 49 CFR 1.50 and

501.8.

Issued: March 11, 1997.

L. Robert Shelton,

Associate Administrator for Safety

Performance Standards.

[FR Doc. 97–6525 Filed 3–13–97; 8:45 am]

BILLING CODE 4910–59–M

DEPARTMENT OF THE TREASURY

Customs Service

[T.D. 97–16]

Country of Origin Marking of Products

From the West Bank and Gaza

AGENCY: U.S. Customs Service,

Department of the Treasury

ACTION: Notice of policy.

SUMMARY: This document clarifies T.D.

95–25 by notifying the public that, with

respect to imported goods which are

produced in the West Bank and Gaza

Strip, acceptable country of origin

markings consist of ‘‘West Bank/Gaza,’’

‘‘West Bank/Gaza Strip,’’ ‘‘West Bank

and Gaza,’’ and ‘‘West Bank and Gaza

Strip’’ as well as ‘‘West Bank,’’ ‘‘Gaza’’

or ‘‘Gaza Strip.’’

EFFECTIVE DATE: The position set forth in

this document is effective for

merchandise entered or withdrawn from

warehouse for consumption on or after

March 14, 1997.

FOR FURTHER INFORMATION CONTACT:

Craig Walker, Special Classification and

Marking Branch (202) 482–6980.

SUPPLEMENTARY INFORMATION:

Background

Section 304 of the Tariff Act of 1930,

as amended (19 U.S.C. 1304), provides

that, unless excepted, every article of

foreign origin (or its container) imported

into the U.S. shall be marked in a

conspicuous place as legibly, indelibly,

and permanently as the nature of the

article (or its container) will permit, in

such a manner as to indicate to the

ultimate purchaser in the U.S. the

English name of the country of origin of

the article. Failure to mark an article in

accordance with the requirements of 19

U.S.C. 1304 shall result in the levy of a

duty of ten percent ad valorem. Part

134, Customs Regulations (19 CFR Part

134), implements the country of origin

marking requirements and exceptions of

19 U.S.C. 1304.

T.D. 95–25

T.D. 95–25, published in the Federal

Register on April 6, 1995 (60 FR 17607),

discussed the proper country of origin

marking for imported goods produced in

the West Bank and Gaza Strip. Prior to

the issuance of the T.D., Customs had

taken the position that, in order for the

country of origin marking of a good

which was produced in the West Bank

or Gaza Strip to be considered

acceptable, the word ‘‘Israel’’ must

appear in the marking designation.

However, by letter dated October 24,

1994, the Department of State advised

the Department of the Treasury that, in

view of certain developments,

principally the Israeli-PLO Declaration

of Principles on Interim SelfGovernment Arrangements (signed on

September 13, 1993), the primary

purpose of 19 U.S.C. 1304 would be best

served if goods produced in the West

Bank and Gaza Strip were permitted to

be marked ‘‘West Bank’’ or ‘‘Gaza

Strip.’’

Accordingly, as Customs has

previously relied upon advice received

from the Department of State in making

determinations regarding the ‘‘country

of origin’’ of a good for marking

purposes, Customs notified the public

in T.D. 95–25 that, unless excepted from

marking, goods produced in the West

Bank or Gaza Strip shall be marked as

‘‘West Bank,’’ ‘‘Gaza,’’ or ‘‘Gaza Strip.’’

The T.D. further stated that the country

of origin markings of such goods shall

not contain the words ‘‘Israel,’’ ‘‘Made

in Israel,’’ ‘‘Occupied Territories-Israel,’’

or words of similar meaning.

Clarification

Subsequent to the issuance of T.D.

95–25, the Israeli-Palestinian Interim

Agreement was signed, granting

additional powers and responsibilities

to the Palestinian Authority. In

addition, an amendment to the United

States-Israel Free Trade Area

Implementation Act of 1985 (19 U.S.C.

2112 note), enacted on October 3, 1996,

authorized the President to proclaim

duty-free treatment to products of the

West Bank and Gaza Strip. Such dutyfree treatment was implemented by

Presidential Proclamation 6955 dated

November 13, 1996, effective for

products of the West Bank and Gaza

Strip entered or withdrawn from

warehouse for consumption on or after

November 21, 1996.

By letter dated January 13, 1997, the

Department of State advised the

Department of the Treasury that the

Palestinian Authority has asked that the

U.S. accept the country of origin

marking ‘‘West Bank/Gaza’’ so as to

reaffirm the territorial unity of the two

areas. The Department of State further

advised that it considers the West Bank

and Gaza Strip to be one area for

political, economic, legal and other

purposes. Accordingly, the Department

of State requested that Customs accept

the country of origin markings ‘‘West