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‘(A) TERMS.—The Secretary may make a 
full funding grant agreement with an applicant. 
The agreement shall—
‘(i) establish the terms of participa-
tion by the Government in a project under 
this section; 
‘(ii) establish the maximum amount of 
Government financial assistance for the 
project; 
‘(iii) cover the period of time for com-
pleting the project, including a period ex-
tending beyond the period of an authoriza-
tion; and 
‘(iv) make timely and efficient man-
agement of the project easier according to 
the law of the United States. 
‘(B) SPECIAL FINANCIAL RULES.—
‘(i) 
IN
GENERAL.—An 
agreement 
under this paragraph obligates an amount 
of available budget authority specified in 
law and may include a commitment, con-
tingent on amounts to be specified in law 
in advance for commitments under this 
paragraph, 
to 
obligate 
an 
additional
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amount from future available budget au-
thority specified in law. 
‘(ii) STATEMENT
OF
CONTINGENT 
COMMITMENT.—The agreement shall state 
that the contingent commitment is not an 
obligation of the Government. 
‘(iii) INTEREST AND OTHER FINANC-
ING COSTS.—Interest and other financing 
costs of efficiently carrying out a part of 
the project within a reasonable time are a 
cost of carrying out the project under a 
full funding grant agreement, except that 
eligible costs may not be more than the 
cost of the most favorable financing terms 
reasonably available for the project at the 
time of borrowing. The applicant shall cer-
tify, in a way satisfactory to the Secretary, 
that the applicant has shown reasonable 
diligence in seeking the most favorable fi-
nancing terms. 
‘(iv) COMPLETION OF OPERABLE SEG-
MENT.—The amount stipulated in an 
agreement under this paragraph for a fixed 
guideway project shall be sufficient to com-
plete at least an operable segment.
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‘(3) EARLY SYSTEM WORK AGREEMENTS.—
‘(A) CONDITIONS.—The Secretary may 
make an early systems work agreement with an 
applicant if a record of decision under the Na-
tional Environmental Policy Act of 1969 (42 
U.S.C. 4321 et seq.) has been issued on the 
project and the Secretary finds there is reason 
to believe—
‘(i) a full funding grant agreement for 
the project will be made; and 
‘(ii) the terms of the work agreement 
will promote ultimate completion of the 
project more rapidly and at less cost. 
‘(B) CONTENTS.—
‘(i) IN GENERAL.—A work agreement 
under this paragraph obligates an amount 
of available budget authority specified in 
law and shall provide for reimbursement of 
preliminary costs of carrying out the 
project, including land acquisition, timely 
procurement of system elements for which 
specifications are decided, and other activi-
ties the Secretary decides are appropriate 
to make efficient, long-term project man-
agement easier.
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‘(ii) 
PERIOD
COVERED.—A 
work 
agreement under this paragraph shall 
cover the period of time the Secretary con-
siders appropriate. The period may extend 
beyond the period of current authorization. 
‘(iii) INTEREST AND OTHER FINANC-
ING COSTS.—Interest and other financing 
costs of efficiently carrying out the work 
agreement within a reasonable time are a 
cost of carrying out the agreement, except 
that eligible costs may not be more than 
the cost of the most favorable financing 
terms reasonably available for the project 
at the time of borrowing. The applicant 
shall certify, in a way satisfactory to the 
Secretary, that the applicant has shown 
reasonable diligence in seeking the most 
favorable financing terms. 
‘(iv) 
FAILURE
TO
CARRY
OUT 
PROJECT.—If an applicant does not carry 
out the project for reasons within the con-
trol of the applicant, the applicant shall 
repay all Government payments made 
under the work agreement plus reasonable
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interest and penalty charges the Secretary 
establishes in the agreement. 
‘(4) LIMITATION ON AMOUNTS.—
‘(A) MAJOR CAPITAL INVESTMENT GRANTS 
CONTINGENT
COMMITMENT
AUTHORITY.—The 
total estimated amount of future obligations of 
the Government and contingent commitments to 
incur obligations covered by all outstanding let-
ters of intent, full funding grant agreements, 
and early systems work agreements under this 
subsection for major new fixed guideway capital 
projects may be not more than the greater of 
the amount authorized under sections 5338(b) 
and 5338(h)(1) for such projects or an amount 
equivalent to the last 3 fiscal years of funding 
allocated under subsections (m)(1)(B) and 
(m)(2)(B)(ii) for such projects, less an amount 
the Secretary reasonably estimates is necessary 
for grants under this section for those of such 
projects that are not covered by a letter or 
agreement. The total amount covered by new 
letters and contingent commitments included in 
full funding grant agreements and early sys-
tems work agreements for such projects may be 
not more than a limitation specified in law.