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INTRODUCTION TO THE FEDERAL AID PROCESS
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  1. INTRODUCTIONTO THEFEDERAL AIDPROCESS 17th Annual Transportation and Planning Symposium October 29, 2007

  2. Representatives Bob Hansen, NYSDOT, Region One Diane Kenneally, NYSDOT, Main Office Roslyn Webber, FHWA, NY Division Dave Hart, FHWA, NY Division

  3. Roles & Responsibilities • FHWA • NYSDOT • Local Agency

  4. Roles & Responsibilities FHWA’s authority and oversight roles are defined in: • 23 USC & 23 CFR • FHWA/NYSDOT SAFETEA-LU Agreement, our authority for delegation • Chapter 2 of the Procedures for Locally Administered Federal Aid Projects

  5. Roles & Responsibilities

  6. FHWA’s Role Ensure Contract Specifications are Fulfilled Ensure Federal Standards are Met Conduct Process Reviews

  7. FHWA’s Role Technical Expertise

  8. NYSDOT’s Role Ensures projects are developed and constructed in full compliance with Federal requirements Protects Federal/State investment on projects regarding the quality, safety and financial integrity of the project Takes necessary corrective actions regarding the above Determines eligibility Federal and State funding

  9. NYSDOT provides guidance and assistance to Sponsors thru… • The Procedures for Locally Administered Federal Aid Projects https://www.nysdot.gov/portal/page/portal/divisions/operating/opdm/local-programs-bureau/locally-administered-federal-aid-projects • The Regional Local Projects Liaison (RLPL) • Interprets regulations, manuals and guidelines • Monitoring • Completeness reviews • Consulting with NYSDOT Main Office and FHWA • Standard Federal-Aid Local Project Agreement • Local Programs Bureau

  10. NYSDOT’s key project responsibilities • Seek Federal authorization for each project phase, i.e., design, ROW, construction • Process Sponsor’s reimbursement requests • Approve design exceptions/non-standard features for work on/related to non-NHS State Highways and non-Interstate NHS • Grant design approval for projects on/related to non-NHS State Highways and non-Interstate NHS

  11. NYSDOT’s key project responsibilities (cont’d) • Approve Railroad and Utility Relocation Agreements • Concur with Contract Award Recommendation • Verify Sponsor’s final inspection and final acceptance of construction contract • Close out local agreement and make final payment

  12. NYSDOT • Local Programs Bureau https://www.nysdot.gov/portal/page/portal/divisions/operating/opdm/local-programs-bureau State Aid CHIPS SHIPS Locally Administered Federal Aid Projects (LAFAP) Multi-modal and Member Items Transportation Enhancement Program (TEP) Safe Routes to School Program (SRTS) List of the RLPL's

  13. The Sponsor’s Role • Responsible for front-ending all project costs • Delegated responsibility for administering and implementing federal-aid projects • Planning • Programming • Environmental investigation • Design • Construction • Maintenance

  14. Standard Federal-Aid Local Project Agreement • Between Sponsor and NYSDOT • Project specific • Describes project phase, funding and deposit requirements • Describes allocation of responsibility • Municipal/Sponsor resolution • Approves project • Funding appropriation • Authorizes appropriate official to execute Agreement

  15. Sponsor’s key project decisions/activities • Getting the project into the STIP • Procuring and approving Consultant contracts • Preparing and submitting reimbursement requests • Performing/overseeing project design and environmental activities • Approving design exceptions/non-standard features on local roads/bridges

  16. Sponsor’s key project decisions/activities • Preparing and submitting NEPA Class II automatic and programmatic categorical exclusion determinations to NYSDOT for concurrence • Making SEQR determinations • Granting design approval • Certifying non-NYSDOT construction specifications on local roads/bridges

  17. Sponsor’s key project decisions/activities • Certifying and acquiring Right of Way (FHWA approval required if not completed prior to contract advertising) • Acquiring needed permits • Coordinating Railroad and Utility Relocation Agreements • Determining/approving DBE goals • Approving construction contract documents

  18. Sponsor’s key project decisions/activities • Advertising and awarding construction contracts • Administering the construction contract • Performing/overseeing construction inspection • Approving contract change orders • Accepting construction contract work

  19. Two Key Documents to Ensure Success • Project Management Plan (PMP) • Construction Management Plan (CMP)

  20. Project Management Plan (PMP) • Implementation strategy • Primary communication tool • Provides clear assignment of authority and accompanying responsibility • Assigns project manager • Schedule • Outlines milestones, products, reviews and approvals

  21. Construction Management Plan (CMP) • Outlines how contract will be administered • Provides clear assignment of authority and accompanying responsibility • Addresses procedures, record keeping, staffing, subcontractor approvals, EEO, inspection, change orders, contract close-out, etc. • Approved by NYSDOT before contract advertising

  22. Federal-Aid Process

  23. FAHP financial procedures Multi-year authorization act (SAFETEA-LU) Annual distribution (apportionment or allocation) Total Federal aid available for a fiscal year Unobligated balances of prior years’ distributions Obligation (Federal government’s promise to pay) Limitation on obligations Annual appropriations act Reimbursement Liquidating cash to reimburse States

  24. Highway Trust Fund Federal Gasoline Tax Breakdown 18.4 cents 18.3 cents 0.1 cent HTF Leaking Underground Storage Tank Trust Fund 15.44 cents 2.86 cents Highway Acct Mass Transit Acct

  25. Legislative Process • Key Terms • Authorization • Appropriation • Contract Authority • Rescission • Federal Legislative Process

  26. SAFETEA-LU • Safe, Accountable, Flexible, Efficient, Transportation Equity Act: A Legacy for Users • President signed the bill into law Aug.10, 2005 • Provides Federal funding for FFY 05-09

  27. U.S. DEPARTMENT OF TRANSPORTATIONFEDERAL HIGHWAY ADMINISTRATION FY 2007 OBLIGATION LIMITATION DISTRIBUTIONPURSUANT TO SECTION 1102 OF THE SAFE, ACCOUNTABLE, FLEXIBLE, EFFICIENT TRANSPORTATION EQUITY ACT: A LEGACY FOR USERS AND THE CONTINUING APPROPRIATION RESOLUTION, 2007, PUBLIC LAW 110-5

  28. U.S. DEPARTMENT OF TRANSPORTATIONFEDERAL HIGHWAY ADMINISTRATIONRescission of Unobligated BalancesPursuant to the Continuing Appropriations Resolution, 2007, Pub. L. No. 110-5, Sec. 21014

  29. Authorization Act / Appropriations Act Obligation Authority Limitation Redistribution

  30. SAFETEA-LU Earmarksin New York State • 436 High Priority Projects • Totaling $ 738M • Mostly off-system projects

  31. High Priority ProjectsMain Features of SAFETEA-LU • Funding available in installments (20% per year, over five FFY’s) • Funds obligated are available until expended • Federal share is 80% • All projects require a match • Obligation Authority (OA) limitations apply • Across the Board Rescissions may be enacted through annual Appropriation Acts

  32. Example of a Conservative Account For Funds Available for a Typical High Priority Project • A typical project listed for $1M in the bill • Federal Share 80% = $1M • Minimum Local Share 20% = $0.250M • Minimum Total Project Cost $1.250M • Total Cost may exceed $1.250M, but recipient must fund all additional costs

  33. Federal Allocation of $1M for this typical high priority project will be made available in five equal (20%) installments subject to Obligation Authority (OA) and Rescission • The allocation will be distributed as follows: • FFY 05-$0.200M • FFY 06-$0.200M • FFY 07-$0.200M • FFY 08-$0.200M • FFY 09-$0.200M

  34. Reduction by Obligation Authority (OA),using 90% as an example for each FFY beyond 2006 • For FFY 05: 85.5% of $0.200M = $0.171M • For FFY 06: 87.0% of $0.200M = $0.174M • For FFY 07: 90.0% of $0.200M = $0.180M • For FFY 08: 90.0% of $0.200M = $0.180M • For FFY 09: 90.0% of $0.200M = $0.180M

  35. Further Potential Reduction from Annual Rescission using 1% as an example for each FFY beyond 2005 • FFY 05: Reduction of $0.171M by 0%= $171,000 • FFY 06: Reduction of $0.174M by 1%= $172,260 • FFY 07: Reduction of $0.180M by 1%= $178,200 • FFY 08: Reduction of $0.180M by 1%= $178,200 • FFY 09: Reduction of $0.180M by 1%= $178,200 • No rescission in FFY 2005; FFY 2006 1% across the board

  36. Estimated Federal Funds Available in Each FFY • FFY 05: $ 171,000 (Original Amount $0.200M) • FFY 06: $ 172,260 (Original Amount $0.200M) • FFY 07: $ 178,200 (Original Amount $0.200M) • FFY 08: $ 178,200 (Original Amount $0.200M) • FFY 09: $ 178,200 (Original Amount $0.200M) • For a typical $ 1M project listed in the Bill, approximate amount of funds available is $0.178M per year Your $1,000,000 authorization is now $877,860 of contract authority

  37. Options for Advancing High Priority Projects • Wait until sufficient funding is available • Fund the project with 100% sponsor funds and receive reimbursement as Federal HPP funding becomes available for obligation • Meeting funding shortfalls is the recipient’s responsibility

  38. Other Provisions of the SAFETEA-LU Bill • All High Priority Projects need to be added to the TIP/STIP • All Federal and State rules apply to all High Priority Projects • All environmental regulations apply to all projects • Amount allocated to a High Priority Project can be used for that project only

  39. All Earmark Projects are to be Implemented According to the Rules and Process Reflected in the Procedures for Locally Administered Federal Aid Projectshttps://www.nysdot.gov/portal/page/portal/divisions/operating/opdm/local-programs-bureau/locally-administered-federal-aid-projects

  40. Project Finances • Reimbursement Program, NOT A GRANT • Federal Share Cannot Exceed 80% Non-Federal Share Required With Limited Exceptions • Local Funds • CHIPs Capital Funds • Legislative Member Items • Soft Match : PE / Cost of ROW / Architectural

  41. Federal-aid Financing Procedures Reimbursement Process

  42. Reimbursements • Process • Sponsor Pays Bills • NYSDOT Pays Sponsor • FHWA Pays NYSDOT • Timing • Periodic or Final Lump Sum • Federal Aid: Varies with billing cycle

  43. Federal-aid Financing Procedures • Audit Procedures • OMB Circular No. A-133 • “Audits of States, Local Governments, and Non-Profit Organizations” • Uniform audit requirements for non-Federal entities and implements the Single Audit Act Financial Integrity Review and Evaluation (FIRE) Order – FHWA Order 4560.1A

  44. Federal Aid Project Proposal (FAPP) • Prepared by Sponsor • Reviewed by NYSDOT • Approved by Sponsor and NYSDOT • Project Added to TIP/STIP • NYSDOT Requests FHWA to Obligate Federal Funds and Receives Federal Authorization

  45. Prerequisitesto Agreement • Project Initiation • Project Listed on TIP & STIP after conformity review (non attainment areas) • High Priority Projects in NYC conformity (Earmarks) • STP-TEP & CMAQ Projects • Project Application • Enhancement • FHWA Authorization