[Congressional Record Volume 169, Number 175 (Tuesday, October 24, 2023)]
[Senate]
[Pages S5136-S5138]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
GOVERNMENT ACCOUNTABILITY OFFICE LEGAL OPINION NO. B-335488
Mr. CRUZ. Mr. President, I ask unanimous consent that the attached
legal opinion of the Government Accountability Office, no. B-335488,
titled ``U.S. Department of Transportation--Applicability of the
Congressional Review Act to Notice of Funding Opportunity for the
Department of Transportation's FY 2023-2024 Multimodal Project
Discretionary Grant Opportunity,'' issued on October 18, 2023, be
printed in the Congressional Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
Decision
Matter of: U.S. Department of Transportation--Applicability
of the Congressional Review Act to Notice of Funding
Opportunity for the Department of Transportation's FY
2023-2024 Multimodal Project Discretionary Grant
Opportunity
File: B-335488
Date: October 18, 2023
DIGEST
On June 23, 2023, the U.S. Department of Transportation
(DOT) published a document titled Notice of Funding
Opportunity for the Department of Transportation's FY 2023-
2024 Multimodal Project Discretionary Grant Opportunity
(MPDG) (Multimodal NOFO). DOT did not submit a report
pursuant to the Congressional Review Act (CRA) to Congress or
the Comptroller General on the Multimodal NOFO.
CRA incorporates the Administrative Procedure Act's
definition of a rule and requires that before a rule can take
effect, an agency must submit the rule to both the House of
Representatives and the Senate, as well as to the Comptroller
General. The Multimodal NOFO announced the availability of
DOT funding for three discretionary grant programs: the
Nationally Significant Multimodal Freight and Highway
Projects program, the National Infrastructure Project
Assistance program, and the Rural Surface Transportation
program. DOT's stated purpose in the Multimodal NOFO was to
fund surface transportation infrastructure projects meeting
the criteria of these programs and aligning with DOT goals.
We conclude that the Multimodal NOFO meets CRA's definition
of a rule and no CRA exception applies. Therefore, the
Multimodal NOFO is subject to CRA's submission requirement.
DECISION
On June 23, 2023, the U.S. Department of Transportation
(DOT) published a document titled Notice of Funding
Opportunity for the Department of Transportation's FY 2023-
2024 Multimodal Project Discretionary Grant Opportunity
(MPDG) (Multimodal NOFO), available at https://
www.transportation.gov/qrants/multimodal-project-
discretionary-grant-notice-fundinq-opportunity (last visited
Sept. 19, 2023). We received a request for a decision as to
whether the Multimodal NOFO is a rule for purposes of the
Congressional Review Act (CRA). Letter from Senator Ted Cruz
to the Comptroller General (July 27, 2023). As discussed
below, we conclude that the Multimodal NOFO is a rule subject
to CRA's submission requirement.
Our practice when rendering decisions is to contact the
relevant agencies to obtain their legal views on the subject
of the request. GAO, Procedures and Practices for Legal
Decisions and Opinions, GAO-06-1064SP (Washington, D.C.:
Sept. 2006), available at https://
[[Page S5137]]
www.gao.gov/products/qao-06-1064sp. Accordingly, we reached
out to DOT to obtain the agency's legal views. Letter from
Assistant General Counsel, GAO, to Acting General Counsel,
DOT (Aug. 2, 2023). We received DOT's response on August 31,
2023. Letter from Acting General Counsel, DOT, to Assistant
General Counsel, GAO (Aug. 31, 2023) (Response Letter).
BACKGROUND
The Multimodal NOFO
The Infrastructure Investment and Jobs Act (IIJA), Pub. L.
No. 117-58, 135 Stat. 429 (Nov. 15, 2021), provided DOT with
funding for three grant programs--the Nationally Significant
Multimodal Freight and Highway Projects grants program, the
Rural Surface Transportation grant program, and the National
Infrastructure Project Assistance grants program. Id.
Sec. Sec. 11110 (Nationally Significant Multimodal Freight
and Highway Projects), 11132 (Rural Surface Transportation
Grant Program); id. Sec. 21201 (National Infrastructure
Project Assistance); see also Multimodal NOFO, at 5. A
general purpose of these grant programs, consistent with the
overall purpose of the IIJA, is to promote ``Federal-aid
highways, highway safety programs, and transit programs,''
IIJA, preamble.\1\ Id. Sec. Sec. 11110, 11132, 21201. The
IIJA authorized appropriations for these three programs
through FY 2026. Multimodal NOFO, at 5.
In the Multimodal NOFO, in order to ``streamline the
process for applicants'' for the FY 2023-2024 grant period,
DOT ``combined [its] solicitations'' for all three of the
above-referenced grant programs. Id. at 5. The Multimodal
NOFO ``encouraged [applicants] to apply for multiple
programs'' and indicated that DOT would automatically
consider applicants for each program ``unless they opt[ed]
out of a specific program.'' Id. at 6. As the Multimodal NOFO
explained, the three grant programs have ``slightly
different'' eligibility criteria, but applicants generally
may include states or groups of states, metropolitan planning
organizations, units of local government, political
subdivisions of states or local governments, and tribal
governments or groups of tribal governments. Id. at 10. The
Multimodal NOFO outlined the precise eligibility and
selection criteria for each program, as well as the types of
projects eligible to receive DOT funding under each one, Id.
at 10, 15. Overall, DOT stated that its purposes were to fund
``surface transportation infrastructure projects . . . with
significant national or regional impact'' and ``to improve
and expand the surface transportation infrastructure in rural
areas.'' Id. at 1. DOT further stated that it sought to award
projects that ``align with the [National Roadway Safety
Strategy]'', ``reduce greenhouse gas emissions and . . .
address climate change impacts'', ``address environmental
justice'', ``address equity and barriers to opportunity'',
and ``support the creation of good-paying jobs'', among other
things. Id. at 6-7.
As compared with a similar notice of funding opportunity
that DOT issued in FY 2022 for these grant programs, the
Multimodal NOFO used changed ``criteria'' to evaluate
applicants and make award decisions in certain respects. Id.
at 8.\2\ For example, the Multimodal NOFO ``revised how
[Outcome Area] criteria will be rated'' and indicated that
Rural Program applicants requesting less than $25 million
need only address a subset of these criteria. Id. The
Multimodal NOFO also indicated that ``[f]or the first time''
DOT would be using ``a Cost Estimate Review team'' to
``evaluate in greater detail the cost estimates for any
project requesting $1 billion or more in funding.'' Id.
Finally, the Multimodal NOFO stated that the ``list of
counties qualifying as Areas of Persistent Poverty'' had been
updated in accordance with new census data, and that the
definition of ``Historically Disadvantaged Communities'' had
been updated ``in accordance with the [White House's] Climate
& Economic Justice Screening Tool'', developed ``as part of
the Justice40 initiative.'' Id. The Multimodal NOFO indicated
that applicants planning to ``reapply using materials
prepared for prior competitions'' should ensure they are ``up
to date'' with DOT's revised criteria. Id. at 8-9.
The Multimodal NOFO provided an application deadline of
August 21, 2023, and indicated that DOT would award
``approximately $5.45-5.575 billion'' to the current
``round'' of applicants ``from FY 2023 and FY 2024 funding.''
Id. at 2
The Congressional Review Act
CRA, enacted in 1996 to strengthen congressional oversight
of agency rulemaking, requires federal agencies to submit a
report on each new rule to both houses of Congress and to the
Comptroller General for review before a rule can take effect.
5 U.S.C. Sec. 801 (a)(1)(A).\3\ The report must contain a
copy of the rule, ``a concise general statement relating
to the rule,'' and the rule's proposed effective date. Id.
CRA allows Congress to review and disapprove federal
agency rules for a period of 60 days using special
procedures. See 5 U.S.C. Sec. 802. If a resolution of
disapproval is enacted, then the new rule has no force or
effect. 5 U.S.C. Sec. 801(b)(1).
CRA adopts the definition of rule under the Administrative
Procedure Act (APA), 5 U.S.C. Sec. 551 (4), which states
that a rule is ``the whole or a part of an agency statement
of general or particular applicability and future effect
designed to implement, interpret, or prescribe law or policy
or describing the organization, procedure, or practice
requirements of an agency.'' 5 U.S.C. Sec. 804(3). CRA
excludes three categories of rules from coverage: (1) rules
of particular applicability; (2) rules relating to agency
management or personnel; and (3) rules of agency
organization, procedure, or practice that do not
substantially affect the rights or obligations of non-agency
parties. Id.
DOT did not submit a CRA report to Congress or the
Comptroller General on the Multimodal NOFO. In its response
to us, DOT asserted that CRA is inapplicable to the
Multimodal NOFO because the Multimodal NOFO is an ``exempt
procedural rule'' and ``not a final agency action.'' Response
Letter at 5-6.
DISCUSSION
An agency action is subject to CRA if it meets the APA's
definition of a rule and no CRA exception applies. Because
the Multimodal NOFO meets the APA's definition of a rule, and
because no CRA exception applies, the Multimodal NOFO is
subject to CRA's submission requirement.
The Multimodal NOFO meets the APA definition of a rule. It
is an agency statement, as it is an official document issued
by DOT and posted on the agency's website. Multimodal NOFO;
see also B-334146, June 5, 2023 (finding that a document
issued by the U.S. Department of Agriculture (USDA) and
posted on USDA website qualified as agency statement); B-
331560, Apr. 16, 2020. Second, the Multimodal NOFO has future
effect, as its provisions apply to, and announce criteria
for, grantprogram applications submitted after its issuance
and before future deadlines. Multimodal NOFO, at 2; see also
B-334146 (finding that a USDA notice of funding opportunity
document had future effect); B-333732, July 28, 2022 (finding
that a USDA publication had future effect because it defined
criteria for determining future financial assistance
benefits). Finally, the Multimodal NOFO prescribes or
implements law or policy and describes agency procedures, as
it defines the procedures by which eligible entities may
apply for three grant programs, describes the process by
which DOT will evaluate these applications, and specifies the
level of funding that applicants may receive. Multimodal
NOFO, at 1-15; B-334146 (finding that a USDA notice of
funding opportunity implemented law or policy and described
agency procedures when it ``establish[ed] a new grant
program'' with ``eligibility requirements'', ``criteria used
to select proposals'', and ``funding level [s]''); see also
B-333732 (finding that USDA's announcement of a payment-in-
kind program for sugar was a rule because it established
application procedures, payment limits, and sanctions for
future noncompliance with program requirements).
Additionally, none of CRA's exceptions apply:
First, the Multimodal NOFO is not a rule of particular
applicability. Rules of particular applicability are those
addressed to specific, identified entities that address
actions that may or may not be taken by those entities, in
light of the facts and circumstances specific to those
entities. B-334995, July 6, 2023; B-334411, June 5, 2023; B-
334146; B-334221, Feb. 9, 2023. The Multimodal NOFO applies
broadly to states or groups of states, metropolitan planning
organizations, units of local government, political
subdivisions of states or local governments, and tribal
governments or groups of tribal governments, among other
entities. Multimodal NOFO, at 10. Thus, it has general, not
particular, applicability. See B-334146 (USDA notice of
funding opportunity had general applicability because it was
addressed to ``local and state governments, small and large
businesses, and nonprofit entities.''); see also B-334221; B-
330843, Oct. 22, 2019.
Second, the Multimodal NOFO is not a rule relating to
agency management or personnel. ``A rule falls within the CRA
exception for rules relating to agency management or
personnel if it relates to purely internal agency matters,
with no effect on non-agency parties.'' B-334411; B-334146;
B-334221. Here, the Multimodal NOFO relates primarily to non-
agency parties. As explained above, it specifies the means by
which a wide variety of non-agency parties may apply for
funding pursuant to three DOT grant programs, as well as
specifying the selection criteria and funding levels for
those programs for FY 2023-2024. Multimodal NOFO, at 1-15.
Thus, it does not relate to agency management or personnel.
B-334146 (finding that USDA notice of funding opportunities
that ``establish[ed] a grant program for a wide array of non-
federal entities'' did not relate to agency management).
Third, and finally, the Multimodal NOFO has a substantial
impact on the rights and obligations of non-agency parties.
GAO has previously found that notice of funding opportunity
documents associated with agency grant programs can have a
substantial impact on non-agency parties. Most recently, we
found that a USDA notice of funding opportunity document
substantially affected the rights and obligations of non-
agency parties by implementing a new grant program for
nonfederal entities and establishing the program's
eligibility requirements, selection criteria, and funding
ranges. B-334146. As we explained, a notice that
``determine[s] whether and in what amount [non-agency]
entit[ies] may receive funding . . . substantially affects
the rights or obligations of those non-agency parties.'' Id.
Similarly, we have found that agency rules amending or
clarifying the requirements of financial assistance programs
for non-agency parties substantially affected those parties''
rights
[[Page S5138]]
and obligations. In B-333732, for instance, we concluded that
USDA's 2021 Thrifty Food Plan substantially affected non-
agency parties because it increased the maximum benefit
allotments for qualifying families under the Supplemental
Nutrition Assistance Program (SNAP).
Here, by reference to the above cases, the Multimodal NOFO
has substantial effects on the rights and obligations of non-
agency parties. While the Multimodal NOFO does not, itself,
establish a new grant program like the USDA notice in B-
334146, it defines the FY 2023-2024 eligibility requirements,
selection criteria, and funding ranges for three existing DOT
grant programs. Multimodal NOFO, at 4-5. Each of these
programs offers potential DOT funding to a wide range of non-
agency parties, as discussed above, which makes DOT's actions
in the Multimodal NOFO comparable to USDA's actions in B-
334146 and B-333732. In the present case, as in B-334146 and
B-333732, the agency's actions ``determine[d] whether and in
what amount [a non-agency] entity may receive funding'',
which ?substantially affects the rights or obligations of
those non-agency parties.'' B-334146.
In its response to us, DOT asserts that the Multimodal NOFO
is an ``exempt procedural rule.'' DOT relies upon four prior
GAO decisions: B-330190, Dec. 19, 2018, B-329926, Sept. 10,
2018, B-329916, May 17, 2018, and B-292045, May 19, 2003.
Response Letter, at 5.\4\ Each of these decisions is
distinguishable, however, because they involved changes to
agencies''internal conduct with only indirect and
insubstantial effects on the rights and obligations of non-
agency parties. See B-330190 (finding CRA inapplicable to
agency memorandum that ``outline[d] the agency's internal
procedure for addressing violations of 8 U.S.C. 51325(a)'');
B-329926 (finding CRA inapplicable to agency manual governing
``the use of evidence from the Internet'' by agency officials
during adjudicatory proceedings); B-329916 (finding CRA
inapplicable to Internal Revenue Service action that ``shifts
the timing of a step in the agency's process'' for reviewing
tax returns); B-292045 (finding CRA inapplicable to a
Department of Veterans Affairs (VA) memorandum announcing a
change in VA's procedures for disposal of real property
because it ``relat[ed] to agency management'' and did not
``affect any party's right or obligation''). None of these
actions was directed at non-agency parties or concerned, like
the Multimodal NOFO and the agency actions in B-334146 and B-
333732, with specifying the terms and conditions for non-
agency parties to apply to receive federal funds. B-330190;
B-329926; B-329916; B-292045.
Relatedly, DOT relies on Batterton v. Marshall, 648 F.2d
694 (D.C. Cir. 1980) to distinguish ``legislative'' from
``procedural'' rules and urge that rules ``may alter the
manner in which the parties present themselves or their
viewpoints to the agency'' without affecting rights or
interests. Response Letter, at 4 (citation omitted). However,
Batterton concerned the distinction between ``legislative''
and other rules for purposes of applying APA notice-and-
comment requirements. See Batterton, 648 F. 2d at 707. As the
legislative history of CRA makes clear, a rule may be
nonlegislative and exempt from APA notice-and-comment
requirements while still being subject to CRA's submission
requirements. A principal sponsor of the CRA legislation
stated that:
Although agency interpretive rules, general statements of
policy, guideline documents, and agency policy and procedure
manuals may not be subject to the notice and comment
provisions of section 553(c) of title 5, United States Code,
these types of documents are covered under the congressional
review [CRA] provisions of the new chapter 8 of title 5.
142 Cong. Rec. H3005 (daily ed. Mar 28, 1996) (Statement of
Rep. McIntosh); see also B-331171, Dec. 17, 2020 (``The
sponsors of CRA intended the definition of rule to be as
broad as possible to ensure congressional review of agency
action.''). Here, as discussed above, the Multimodal NOFO
does more than just alter the manner in which certain parties
present themselves to DOT, it determines whether and in what
amount non-agency entities may receive funding from the
federal government.
DOT also asserts that the Multimodal NOFO's ``requirements
for eligible applicants, cost sharing requirements, eligible
project types, and eligible project costs'' did not originate
with the Multimodal NOFO but come directly from the
``detailed statutory authorit[ies]'' governing DOT's grant
programs. Response Letter, at 4. In other words, according to
DOT, ``any rights and obligations'' at issue in this matter
``are prescribed by existing laws,'' not by the Multimodal
NOFO. Id. We acknowledge that the statutes governing DOT's
grant programs are detailed in many respects and establish
eligibility and other criteria outlined in the Multimodal
NOFO. However, it is not the case that the Multimodal NOFO
did nothing more than echo terms and conditions already set
forth in DOT's program statutes. Those statutes left DOT with
clear discretion and gap-filling authority in many respects.
For example, the statute governing the National
Infrastructure Project Assistance program states that
applications shall be submitted ``at such time, in such
manner, and containing such information as [DOT] determines
to be appropriate.'' 49 U.S.C. Sec. 6701 (c). It also
instructs DOT to ``determin[e]'' whether a given project
applying for grant funds ``is in need of significant Federal
funding'' and ``will be cost-effective,'' among other things.
Id Sec. 6701 (f). In the Multimodal NOFO, DOT exercised its
discretion to elaborate upon these statutory terms by
defining the ``time'' and ``manner'' in which applications
must be submitted and specifying detailed ``information''
requirements, See, e.g., Multimodal NOFO, at 1-3 (stating
deadlines and ``anticipated'' funding amounts not set forth
in DOT's program statutes). With respect to the issue of
whether projects will be ``cost-effective,'' for example, the
Multimodal NOFO outlines a ``recommended approach for the
completion and submission of a benefit-cost analysis (BCA)
narrative and calculation file,'' as well as encouraging
applicants to ``review DOT's detailed guidance'' cited in the
Multimodal NOFO. Id. at 42. By providing detailed
instructions in this and other respects, the Multimodal NOFO
affected ``whether and in what amount [non-agency] entit[ies]
may receive funding'', which, once again, ``substantially
affects the[ir] rights or obligations.'' B-334146.
Finally, DOT asserts that the Multimodal NOFO is ``not a
final agency action'' and is ``exempt'' from CRA because no
applicant is ``obligated to apply for'' or ``entitled to
receive''the advertised funding, and because DOT has yet to
make the ``final project selections'' that may result in
grant awards. Response Letter, at 6 (citation omitted).
However, DOT did not distinguish the funding notice in B-
334146, which, like the Multimodal NOFO, was discretionary
and left final award decisions contingent upon further action
by USDA. See, e.g.. USDA, Partnerships for Climate-Smart
Commodities, USDA-NRCS-COMM-22-NOF00001 139, available at
https://www.grants.gov/web/grants/view-
opportunity.html?oppld=337878 (last visited Sept. 19, 2023)
(outlining an opportunity for ``[d]iscretionary'' grants). A
grant notice need not announce mandatory funding or make
final award decisions in order to have a substantial effect
on the rights and obligations of non-agency parties. B-
334146. Rather, as we have explained, an agency action may be
``non-binding'' and contemplate ``further action'' without
therefore becoming ``eligible for CRA's procedural
exception.'' B-334032.2, Apr. 5, 2023 (``CRA's requirements
are applicable to general statements of policy that lack
legally binding effects.'') (citation omitted). Here, DOT's
announcement of criteria that ``determine[d] whether and in
what amount [a non-agency] entity may receive funding'' is
sufficient to make the Multimodal NOFO ineligible for that
exception. See B-334146.
CONCLUSION
The Multimodal NOFO is a rule under CRA because it meets
the APA's definition of a rule and no CRA exception applies.
Therefore, the Multimodal NOFO is subject to CRA's
requirement that it be submitted to Congress before it can
take effect.
(Signed) Edda Emmanuelli Perez, General Counsel.
ENDNOTES
1. Under the general rubric of improving highways, highway-
safety, and transit programs, each program focuses on
particular types of improvement projects, in line with their
titles and corresponding IIJA provisions. Two of these
programs--the Rural Surface Transportation grant program and
the National infrastructure Project Assistance grants
program--originated with the LLJA. LLJA Sec. Sec. 11110,
11132; id Sec. 21201.
2. DOT previously announced and awarded funding for the FY
2022-2023 period via a publication titled Notice of Funding
Opportunity for the Department of Transportation's Project
Discretionary Grant Opportunity, 87 Fed., Reg. 17108 (Mar.
25, 2022).
3. Alternatively, an agency can find for good cause that
notice and public procedure are impracticable, unnecessary,
or contrary to the public interest, and the rule will then
take effect at a time the agency determines. 5 U.S.C. Sec.
808(2).
4. Additionally, DOT urges that the Multimodal NOFO is
distinguishable from the grant notices in B-33416 because
USDA in that case exercised ``general statutory authority''
to ``accomplish certain enumerated statutory ends.'' Response
Letter, at 5. However, GAO's determination that the notice of
funding opportunities at issue in B-334146 did not qualify
for the CRA's third exception was based on the effects of
USDA's actions on non-agency parties, as discussed above, not
on the general or specific nature of USDA's statutory
authority.
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