[Federal Register Volume 59, Number 68 (Friday, April 8, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-8501]


[[Page Unknown]]

[Federal Register: April 8, 1994]


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DEPARTMENT OF TRANSPORTATION
 

Innovative Financing; Test and Evaluation Project TE-045; 
Information

AGENCY: Federal Highway Administration (FHWA), (DOT).

ACTION: Notice.

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SUMMARY: The purpose of this notice is to assure wide dissemination of 
information about the FHWA Innovative Financing-Test and Evaluation 
Project TE-045. The FHWA, which established this project by a March 14, 
1994, memorandum to its regional and division offices, is publishing 
the memorandum. The FHWA's authority to advance this project is 
contained in 23 U.S.C. 307(a) and is part of the FHWA implementation of 
the Intermodal Surface Transportation Efficiency Act of 1991 (ISTEA) 
(Pub. L. 102-240, 105 Stat. 1914).

FOR FURTHER INFORMATION CONTACT: Specific questions on FHWA innovative 
financing; Test and Evaluation Project TE-045 should be directed to the 
contact persons named in the memorandum or to FHWA Regional Office or 
FHWA Division Office in your State.

    Issued on: April 4, 1994.
Rodney E. Slater,
Federal Highway Administrator.

Memorandum

    U.S. Department of Transportation, Federal Highway 
Administration, Date: March 14, 1994. Innovative Financing--Test and 
Evaluation Project, TE-045, From: Administrator.

Foreword

    The President's vision for long-term prosperity for the Nation 
means investing in America. That investment includes transportation. 
Our network of highways sustains our economy and ties our country 
together by ensuring the safe and rapid transport of people and 
products. Executive Order 12893, ``Principles for Federal 
Infrastructure Investments,'' signed by the President on January 26, 
1994, signals the Administration's belief that investment in 
transportation will lay the foundation for economic growth in the next 
century.
    The challenge is to encourage prudent investment, to tap into the 
potential of global competitiveness, and to boldly create a dynamic 
period of construction within the budgetary constraints facing all 
levels of government. Secretary Pena, responding to that challenge, has 
asked us to explore innovative ways to meet the transportation needs of 
the Nation. In support of the Secretary's initiative, FHWA has formed 
an Innovative Financing Task Force.
    The Task Force recognizes that the Intermodal Surface 
Transportation Efficiency Act (ISTEA) provides the States with new 
flexibility for funding their surface transportation capital programs. 
While the States have been strong supporters of the flexibility 
provided by ISTEA and have demonstrated an increasing use of this 
flexibility, the complexity and newness of some financing issues have 
challenged their ability to use the innovative financing provisions. 
The goal for FHWA is to identify additional actions, including 
establishing incentives and the removal of existing barriers, to 
encourage States, private investors, and the financial community to 
increase investment in transportation.
    The FHWA can provide national leadership on innovative financing 
with the States by creating a record of achievement. We believe the 
best approach to this challenge is to identify specific projects, 
develop a plan of finance, and offer those projects as examples of 
creative financing solutions. Developing good examples is a key element 
of this proactive effort. To stimulate and advance such projects, I 
have, by this memorandum, established FHWA Test and Evaluation Project 
TE-045 ``Innovative Financing.''

Test and Evaluation Projects

    These Test and Evaluation Projects should develop innovative 
financing concepts which hold the most potential to increase investment 
or reduce public agency costs. For example, areas suggested for 
consideration include:
    1. Broader interpretation of ISTEA section 1012 (ISTEA Toll 
Provisions) to permit more flexible definition of certain section 1012 
terms, loan provisions, and increased local discretion, and investment 
opportunities;
    2. More flexible interpretation of current title 23 State matching 
share requirements to allow ``adjustable'' matching, section 1044 
``soft-match'' credits, other changes in State matching funds, or other 
cash flow management modifications;
    3. Increased ability to generate and use for highway purposes 
highway-related income from leases, lease options, air rights, license 
fees, easements, rights-of-way and concessions, or a combination 
thereof to increase the marketability of transportation investment 
opportunities;
    4. Expanded interpretation of highway bond regulations to allow for 
innovative debt or credit enhancement instruments or other investment 
banking arrangements;
    5. Use of Federal aid to promote public-private partnerships in 
investment, and permit more innovative contracting; and
    6. Increased incentives to encourage that revenues from taxes, 
tolls, fees, or other sources be pledged to capital highway bonds, and/
or create transportation revolving funds.
    These concepts are offered as illustrations only. Other ideas with 
the potential to leverage investment or reduce public agency costs are 
encouraged and will be considered.
    The FHWA has general discretion to conduct financing, research and 
development under 23 U.S.C. 307(a). Under Test and Evaluation Projects, 
FHWA will make full use of ISTEA and other FHWA regulatory and 
statutory flexibility. TE-045 projects must comply with non-title 23 
statutory and regulatory requirements such as the National 
Environmental Policy Act, Civil Rights, relocation assistance, and the 
Clean Air Act as well as with title 23 statutory and regulatory 
environmental requirements (e.g., section 4(f)(23 U.S.C. 138)).

Proposals

    The proposals for candidate projects should describe:
    1. The project specifics;
    2. Project funding--regular Federal aid as well as other funding 
sources;
    3. Status of major Federal clearances and design;
    4. Financing innovation, and how its use on a test and evaluation 
basis could benefit other projects;
    5. Incentives required (i.e., financial, administrative, design, 
project fast-tracking);
    6. How the proposed project will leverage public investment in 
highways; and
    7. The timeline for advancing the project including key milestones.
    Proposals must be for ISTEA-eligible projects; new construction and 
reconstruction projects are appropriate. Those proposals which meet 
major Federal clearance requirements will receive preference in the 
review process. Upon acceptance of a State's proposal, the project will 
be advanced by the FHWA offices in a normal but expedited manner.
    States' proposals should be submitted to the Office of the FHWA 
Deputy Administrator (HOA-2) through the regional and division offices 
with an initial submission by April 29. Questions may be directed to 
either Mr. Jerry Poston--HNG-12 (202) 366-0450 or Mr. Bruce Cannon--
HPP-20 (202) 366-9208.

[FR Doc. 94-8501 Filed 4-7-94; 8:45 am]
BILLING CODE 4910-22-P