[Federal Register Volume 60, Number 138 (Wednesday, July 19, 1995)]
[Rules and Regulations]
[Pages 36991-36993]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-17567]



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DEPARTMENT OF TRANSPORTATION

Federal Highway Administration

23 CFR Part 630

[FHWA Docket No. 95-10]
RIN 2125-AD59


Advance Construction of Federal-Aid Projects

AGENCY: Federal Highway Administration (FHWA), DOT.

ACTION: Interim final rule with request for comments.

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SUMMARY: The FHWA is amending its regulation on advance construction of 
Federal-aid highway projects to incorporate changes made by the Dire 
Emergency Supplemental Appropriations Act, 1992, Pub. L. 102-302, 106 
Stat. 248, and to provide more flexible funding arrangements for the 
States.

DATES: This interim final rule is effective July 19, 1995. Comments 
must be received by September 18, 1995.

ADDRESSES: All written, signed comments should refer to FHWA Docket No. 
95-10, Room 4232, HCC-10, Office of the Chief Counsel, Federal Highway 
Administration, 400 Seventh Street SW., Washington, D.C. 20590. All 
comments received will be available for examination at the above 
address between 8:30 a.m. and 3:30 p.m., e.t., Monday through Friday, 
except Federal holidays. Those desiring notification of receipt of 
comments must include a self-addressed, stamped postcard.

FOR FURTHER INFORMATION CONTACT:
Max I. Inman, Office of Fiscal Services, (202) 366-2853, or Steve M. 
Rochlis, Office of the Chief Counsel, (202) 366-0761, Federal Highway 
Administration, 400 Seventh Street SW., Washington, D.C. 20590. Office 
hours are from 7:45 a.m. to 4:15 p.m., e.t., Monday through Friday, 
except Federal holidays.

SUPPLEMENTARY INFORMATION: The Dire Emergency Supplemental 
Appropriations Act, 1992, Pub. L. 102-302, 106 Stat. 248, included a 
revision to section 115 of title 23, U.S.C., to authorize advance 
construction on surface transportation program projects and other 
technical changes.
    Section 115 allows States to advance the construction of Federal-
aid highway projects without requiring that Federal funds be obligated 
at the time the FHWA approves the project. States may proceed with 
projects using only State funds and then request that Federal funds be 
made available at a later time.
    The Dire Emergency Supplemental Appropriations Act, 1992, made the 
following changes to 23 U.S.C. 115:
    (a) Authorized advance construction on the surface transportation 
program, the national highway system, and congestion mitigation and air 
quality improvement program projects.
    (b) Limited the amount which may be approved for advance 
construction to a State's expected apportionments.
    In addition to the changes made by the Dire Emergency Supplemental 
Appropriations Act, 1992, the regulation is being revised to provide 
additional flexibility to the States by allowing partial conversions of 
advance construction instead of requiring the full amount to be 
converted at one time.

Section-by-Section Analysis

Section 630.701  Purpose

    There are no changes to this section.

Section 630.703  Eligibility

    This section is revised to authorize advance construction on the 
surface transportation program, the national highway system, congestion 
mitigation and air quality improvement programs, and delete references 
to the secondary, urban, rail-highway crossing, and hazard elimination 
programs which are no longer eligible for advance construction 
projects.

Section 630.705  Procedures

    There are no changes to this section.

Section 630.707  Limitation

    This section is revised to remove the previous limitation which 
provided States with a window (January 1, 1987 to September 30, 1990) 
in which advance construction projects could be approved for a State up 
to its expected apportionments plus an amount equal to one additional 
year of apportionment (except for Interstate construction), and to add 
the new limitation on advance construction approvals.

Section 630.709  Conversion to a Regular Federal-Aid Project

    This section is revised to remove paragraph (b) and to redesignate 
paragraph (c) as (b). Removing paragraph (b) provides flexibility to 
the States when converting projects to regular funding by allowing 
partial conversions instead of requiring the full amount to be 
converted at one time, as paragraph (b) provided.

[[Page 36992]]


Section 630.711  Payment of Bond Interest

    There are no changes to this section.

Rulemaking Notices and Analyses

    With regard to the amendments made by this interim final rule in 
accordance with the Dire Emergency Supplemental Appropriations Act, the 
FHWA finds that prior notice and opportunity for comment are 
unnecessary under 5 U.S.C. 553(b)(3)(B) and that good cause exists to 
dispense with the 30-day delayed effective date ordinarily required 
under 5 U.S.C. 553(d) because these changes are statutorily mandated. 
Therefore, the FHWA is not exercising discretion in a way that could be 
meaningfully affected by public comment.
    In addition, the amendment allowing States to partially convert 
advance construction projects to regular Federal-aid projects removes 
the restriction on such conversions which required the full Federal 
share of project costs to be converted at one time. Thus, this action 
``grants or recognizes an exemption or relieves a restriction'' in 
accordance with 5 U.S.C. 553(d)(1) and therefore is exempted from the 
30-day delayed effective date requirement.
    In an April 8, 1994, Federal Register notice, the FHWA announced 
its Innovative Financing Test and Evaluation Project to provide 
incentives to encourage States, private investors, and the financial 
community to increase investment in surface transportation projects, 59 
FR 16889. The modification to the advance construction conversion 
provision included in this interim final rule has been made at the 
request of several States in response to this project, and will provide 
States with the option of partially converting advance construction 
projects to regular Federal-aid projects; States may continue to fully 
convert projects if they would like to do so. Therefore, the FHWA has 
concluded that prior notice and opportunity for comment on this effort 
to provide more flexible funding arrangements for the States, at their 
request, are unnecessary under 5 U.S.C. 553(b)(3)(B).
    For these reasons, the FHWA has also determined that prior notice 
and opportunity for comment are not required under the Department of 
Transportation's regulatory policies and procedures, as it is not 
anticipated that such action would result in the receipt of useful 
information. Therefore, the FHWA is proceeding directly to an interim 
final rule which is effective upon its date of publication.

Executive Order 12866 (Regulatory Planning and Review) and DOT 
Regulatory Policies and Procedures

    The FHWA has determined that this action is not a significant 
action within the meaning of Executive Order 12866 or significant 
within the meaning of Department of Transportation regulatory policies 
and procedures. This rule affects the manner in which State highway 
agencies financially administer project obligations. This interim final 
rule will permit States to proceed with projects using only State funds 
and then request that Federal funds be made available at a later time. 
This amendment will provide States with an additional financing option 
which they may choose to use to more effectively manage their Federal 
apportionments. This rule will not result in a major increase in costs 
or prices for State or local governments and will not have an adverse 
effect on competition, employment, investment, productivity, innovation 
or on the ability to compete with foreign enterprises. It is 
anticipated that the economic impact of this rulemaking will be 
minimal; therefore, a full regulatory evaluation is not required.

Regulatory Flexibility Act

    In compliance with the Regulatory Flexibility Act (5 U.S.C. 601-
612), the FHWA has evaluated the effects of this rule on small 
entities.
    This rulemaking is directed toward State governments, and it is 
initiated in order to implement a statutory mandate. The primary impact 
of this action will be to provide the States with additional 
flexibility in using advance construction procedures. Based on this 
evaluation, the FHWA hereby certifies that this action will not have a 
significant economic impact on a substantial number of small entities.

Executive Order 12612 (Federalism Assessment)

    This action has been analyzed in accordance with the principles and 
criteria contained in Executive Order 12612, and it has been determined 
that this action does not have sufficient federalism implications to 
warrant the preparation of a federalism assessment. This rule does not 
impose additional costs or burdens on the States, including the likely 
source of funding for the States nor does it affect the ability of the 
States to discharge traditional State governmental functions. The 
primary intent of this rule is to provide the States with additional 
flexibility in using advance construction procedures.

Executive Order 12372 (Intergovernmental Review)

    Catalog of Federal Domestic Assistance Program Number 20.205, 
Highway Planning and Construction. The regulations implementing 
Executive Order 12372 regarding intergovernmental consultation on 
Federal programs and activities apply to this program.
Paperwork Reduction Act

    This action does not contain a collection of information 
requirement for the purpose of the Paperwork Reduction Act of 1980, 44 
U.S.C. 3501-3520.

National Environmental Policy Act

    The agency has analyzed this section for the purpose of the 
National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.) and 
has determined that this action would not have any effect on the 
quality of the environment.

Regulation Identification Number

    A regulation identification number (RIN) is assigned to each 
regulatory action listed in the Unified Agenda of Federal Regulations. 
The Regulatory Information Service Center publishes the Unified Agenda 
in April and October of each year. The RIN contained in the heading of 
this document can be used to cross reference this action with the 
Unified Agenda.

List of Subjects in 23 CFR Part 630

    Bonds, Government contracts, Grant programs--transportation, 
Highways and roads, Reporting and recordkeeping requirements.

    Issued on: July 11, 1995.
Rodney E. Slater,
Federal Highway Administrator.

    In consideration of the foregoing, the FHWA is amending title 23, 
Code of Federal Regulations, chapter I, part 630 as set forth below.

PART 630--PRECONSTRUCTION PROCEDURES

    1. The authority citation for part 630 is revised to read as 
follows and all other authority citations which appear throughout part 
630 are removed:

    Authority: 23 U.S.C. 101(a), 104, 105, 106, 109, 110, 113, 115, 
118, 120(e), 121(c), 125, 134, 315, 320, and 402(a); 23 CFR 1.32, 
630; and 49 CFR 1.48(b).

SUBPART G--[REVISED]

    2. Subpart G of part 630 is revised to read as follows:

[[Page 36993]]


Subpart G--Advance Construction of Federal-Aid Projects

Sec.
630.701  Purpose.
630.703  Eligibility.
630.705  Procedures.
630.707  Limitation.
630.709  Conversion to a regular Federal-aid project.
630.711  Payment of bond interest.

Subpart G--Advance Construction of Federal-Aid Projects


Sec. 630.701  Purpose.

    The purpose of this subpart is to prescribe procedures for 
advancing the construction of Federal-aid highway projects without 
obligating Federal funds apportioned or allocated to the State.
Sec. 630.703  Eligibility.

    (a) The State Highway Agency (SHA) may proceed with a highway 
substitute, congestion mitigation and air quality improvement program, 
surface transportation program, bridge replacement and rehabilitation, 
or planning and research project in accordance with this subpart, 
provided the SHA:
    (1) Has obligated all funds apportioned or allocated to it under 23 
U.S.C. 103(e)(4)(H), 104(b)(2), 104(b)(3), 104(f), 144, or 307, as the 
case may be for the proposed project, or
    (2) Has used all obligation authority distributed to it, or
    (3) Demonstrates that it will use all obligation authority 
distributed to it.
    (b) The SHA may proceed with a National Highway System (NHS) or 
Interstate project in accordance with this subpart without regard to 
apportionment or obligation authority balances. Interstate projects 
include Interstate construction and Interstate maintenance.


Sec. 630.705  Procedures.

    (a) An advance construction project shall meet the same 
requirements and be processed in the same manner as a regular Federal-
aid project, except,
    (1) The FHWA authorization does not constitute any commitment of 
Federal funds on the project, and
    (2) The FHWA shall not reimburse the State until the project is 
converted under Sec. 630.709.
    (b) Project numbers shall be identified by the letters ``AC'' 
preceding the regular project number prefix.
    (c) If the SHA plans to claim bond interest costs under 
Sec. 630.711, it shall include in its request for authorization the 
estimated federally participating bond interest cost.
    (d) The SHA shall submit a final voucher to the FHWA upon 
completion of the project even though the project has not been 
converted. If the SHA is claiming bond interest costs under 
Sec. 630.711, it shall certify on the final voucher that the bond 
proceeds were expended in the construction of the project and shall 
include a computation of the eligible interest costs.


Sec. 630.707  Limitation.

    A request to approve an advance construction project is limited to 
a State's expected apportionment of authorized funds which are eligible 
to finance the project.


Sec. 630.709  Conversion to a regular Federal-aid project.

    (a) The SHA may submit a written request to the FHWA that a project 
be converted to a regular Federal-aid project at any time provided that 
sufficient Federal-aid funds and obligation authority are available.
    (b) Subsequent to FHWA approval the SHA may claim reimbursement for 
the Federal share of project costs incurred, provided the project 
agreement has been executed. If the SHA has previously submitted a 
final voucher, the FHWA will process the voucher for payment.


Sec. 630.711  Payment of bond interest.

    (a) For Interstate projects authorized by the FHWA after January 6, 
1983, and for Interstate 4R, Interstate maintenance, primary and NHS 
projects authorized by the FHWA after April 2, 1987, interest earned 
and payable on bonds issued by a State is an eligible cost of 
construction as follows:
    (1) Participating interest cost is based on the actual expenditure 
of bond proceeds on the Federal-aid project. The interest on the bonds 
is applied to the amount of bond proceeds expended on the project from 
the date of expenditure.
    (2) The amount of interest determined in paragraph (a)(1) of this 
section shall not exceed the estimated increase in the physical 
construction cost of the project which would have occurred had the 
project been authorized on the date of conversion. The estimated 
increase in the physical construction cost is determined by applying 
the increase, if any, in the national construction cost index in effect 
on the date of conversion over the index in effect on the date of the 
FHWA authorization, to the actual cost of physical construction.
    (b) For Interstate projects under physical construction on January 
1, 1983, and converted to a regular Federal-aid project after January 
1, 1983, bond interest is eligible in accordance with paragraph (a)(1) 
of this section. The restriction in paragraph (a)(2) of this section 
does not apply.

[FR Doc. 95-17567 Filed 7-18-95; 8:45 am]
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