The Highway Trust Fund is a fund supported by taxes highway users pay on fuel, tires, truck purchases, and the use of heavy vehicles. The revenue from these taxes supports highway construction and maintenance, highway safety, and transit. FHWA administers the Federal-Aid Highway Program and apportions trust fund revenues to state highway departments or transportation authorities, which oversee the construction of the individual projects. Once FHWA notifies a state that a particular highway project has been approved, a state can submit receipts to FHWA after it has incurred expenses. FHWA approves reimbursements to the state for its expenses, usually for 80 percent of a project’s costs; the state and local governments are responsible for the other 20 percent. Federal reimbursements from the Highway Trust Fund have risen from around $15 billion in 1990 to more than $35 billion in 2006, the last year for which data are available. The federal reimbursements that states receive vary by state; however, in general, in fiscal year 2006, the federal government provided about 35 percent of the money that states and local governments spent on highway projects. While the federal government provides most funding from the Highway Trust Fund directly to the states and the states oversee the use of these funds, by statute, states must provide some trust fund revenues to other organizations, such as MPOs, for planning purposes. Federally funded highway projects are typically carried out in four phases: planning, preliminary design and environmental review, final design and right-of-way acquisition, and construction. In the planning phase, state and local highway planners look at transportation alternatives and work with the public to choose projects that make the most sense for their areas. According to FHWA, this phase can take up to 5 years for a major highway project. During the preliminary design and environmental review phase, states identify engineering issues, roadway alignment alternatives, transit options, project costs, and other details. In addition, the proposed project and any alternatives are examined for potential impacts on the environment, public health, and welfare. This process can take 1 to 5 years, according to FHWA, depending on the complexity of the design and possible environmental considerations that must be considered. During the final design and right-of-way acquisition phase, states develop detailed engineering plans consistent with the results of the environmental review phase and acquire the right-of-way needed to construct the project. This phase typically takes from 2 to 3 years for a major new highway construction project, according to FHWA. Finally, during the construction phase, the state evaluates bids from contractors and then oversees the selected contractor’s construction of the project. The construction of a major project typically takes, according to FHWA, 2 to 6 years. See figure 1 for a more detailed description of the types of activities and stakeholders included in the phases of a highway project. The federal, state, and local governments all have a role construction of federally financed highway projects. However, the state DOT is the focal point for these activities. It is responsible for setting a state’s transportation goals and for planning safe and efficient transportation between cities and towns in the state. The state DOT also in the designs most projects, acquires right-of-way for highway constr awards contracts to build projects. Local governments also carry out man transportation planning functions, such as scheduling improvements and maintenance for local streets and roads. At the federal level, FHWA is the primary agency involved in transportation project decision making and oversight. FHWA oversees the transportation planning and project activities of state DOTs by approving state transportation plans and certifying that states have met all legal requirements associated with accepting federal funding. According to FHWA, over 7 federal funding for highway projects. Some of these requirements are transportation specific, such as requirements under the DBE program and the Buy America program, while others, such as NEPA, are general requirements that can apply to other construction projects, such as federal building construction. FHWA officials stated that they identify all requirements that states must meet in the documentation FHWA provides to states when funding for a project is approved. States in turn communicate these requirements to potential bidders, so the contractors know, for example, what wages they must pay or whether they must buy American-made iron and steel. 0 requirements may apply to states that accept The requirements for analyzing funded highway projects originated in NEPA, enacted in 1969. This legislation requires agencies to consider and, if possible, avoid or mitigate potential environmental degradation from federally funded infrastructure projects before these projects moved forward. FHWA ensures that federally funded projects go through an environmental review process, as prescribed in NEPA and its implementing regulations. FHWA officia stated that under FHWA’s NEPA implementation process, the lead agency must demonstrate that it will implement the project consistently with several environmental laws. Laws under FHWA’s NEPA “umbrella” include, but are not limited to the environmental impact of federally the Clean Water Act, protecting wetlands; water quality and ensuring protection of ir Act, protecting air quality; the Endangered Species Act, protecting t species and their habitats; hreatened and endangered Section 138, Title 23 of the U.S. Code, preventing the use of parkland or recreational areas in the development of highway projects, except where no feasible and prudent alternative exists; and the National Historic Preservation Act of 1966, identifying historic properties that may be damaged by the construction of infrastructure projects, and determining ways to avoid, minimize, or mitigate such damage. If no federal funds are used on a project or if a project does not require federal approval, NEPA is generally inapplicable; however, these projects still must comply with all applicable federal environmental laws, which can include the Clean Water and Clean Air Acts. While FHWA is generally the lead agency in ensuring that states comply with NEPA on federally financed highway projects, other federal agencies have responsibilities under these laws. These agencies include EPA (air and water quality, wetlands preservation); the Fish and Wildlife Service (terrestrial threatened and endangered species) within the Department of the Interior; the National Marine Fisheries Service (marine threatened and endangered species, effects on fish and spawning grounds) within the Department of Commerce; USACE (effects on U.S. waters, including wetlands); and ACHP (effects on historic properties). According to FHWA, under the NEPA process, FHWA decides how extensive an environmental review a federally funded highway project will undergo. This decision is based on the size and complexity of the project, as well as the project’s expected environmental impact. For example, FHWA may deem a project that is expected to have no significant environmental impact to be categorically excluded, meaning that the project will not need an environmental assessment (EA) or an environmental impact statement (EIS) to comply with NEPA. A project whose environmental impact is unknown or may be potentially significant will undergo an EA to determine if the impact could be significant and thus require an EIS. A project that is expected to have a significant environmental impact will require an EIS, which will determine the particular environmental impacts of the project and include plans for mitigating these impacts. States usually have only a few EISs under way at any one time, since they are performed generally for the largest highway projects, which pose significant impacts to the environment. For projects undergoing an EIS, FHWA issues a Record of Decision when the process is complete. The Record of Decision indicates whether a project complies with environmental laws and determines changes to the project for environmental mitigation, such as the creation of additional wetlands to mitigate the loss of wetlands or a change in route to avoid environmental impacts. EPA is responsible for reviewing and commenting on all major federal actions for which an EIS is required and for working with FHWA to ensure compliance with environmental statutes. FHWA has the final approval authority and determines when the EIS is in compliance with applicable environmental laws and other requirements. Outside the environmental arena, states must meet requirements for paying a prevailing wage for construction work when accepting federal highway funding. The Davis-Bacon prevailing wage requirement mandates that workers on all federal-aid highway projects receive at least the local prevailing wage for their work. The law stems from a Depression-era practice of transporting workers from a lower-paying area to bypass local workers who would demand a higher wage. The Davis-Bacon prevailing wage requirement prevented this practice by ensuring that workers on federal projects are paid at least the local prevailing local wage. DOL sets the minimum wage that must be paid in each county in the United States for various job categories, such as sheet metal worker or concrete finisher. DOL sets these minimum wage rates based on periodic surveys it conducts of employers in each county. To show they have paid the prevailing wage to their employees, highway contractors must provide their payroll data to the state DOT and certify that they have complied with the Davis-Bacon prevailing wage requirement. All subcontractors must provide this documentation to the lead contractor on a project, known as the prime contractor, who in turn provides it to the state DOT. The state then reviews the documentation to ensure compliance; if the state discovers noncompliance, the contractor must pay the employees supplemental wages to cover the difference between what was paid and the original agreed-to prevailing wage. If the contractor still does not comply with wage requirements, the state DOT may use contractual remedies, such as withholding progress payments, to ensure compliance. FHWA occasionally spot-checks the documentation to further ensure compliance with the Davis-Bacon prevailing wage requirement. The DBE program requires that states attempt to expend a portion of the funds they receive from U.S. DOT for highways, transit, and other transportation-related contracts to firms owned by members of disadvantaged populations. The intent of this program is to remove barriers to participation in federal contracting and ensure nondiscrimination in awarding federal contracts. Legislation, executive action, and judicial decisions have resulted in modifications to the initial program. U.S.