[Federal Register Volume 62, Number 123 (Thursday, June 26, 1997)]
[Rules and Regulations]
[Pages 34397-34405]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-16779]


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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration
Federal Highway Administration

23 CFR Parts 1200 and 1205

[NHTSA Docket No. 93-55, Notice 5]
RIN 2127-AG69


Uniform Procedures for State Highway Safety Programs

AGENCY: National Highway Traffic Safety Administration and Federal 
Highway Administration, DOT.

ACTION: Interim final rule; request for comments.

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SUMMARY: This document establishes new uniform procedures governing the 
implementation of State highway safety programs. It amends existing 
requirements by providing a more flexible system under which States are 
responsible for setting highway safety goals and implementing programs 
to achieve those goals.
    This document is being issued as an interim final rule to provide 
guidance to the States before the start of fiscal year 1998. The 
agencies request comments on the rule. The agencies will publish a 
notice responding to the comments received and, if appropriate, will 
amend provisions of the regulation.

DATES: This interim final rule becomes effective June 26, 1997. 
Comments on this interim rule are due no later than August 11, 1997.

ADDRESSES: Comments should refer to the docket number set forth above 
and be submitted (preferably in 10 copies) to the Docket Section, Room 
5109, National Highway Traffic Safety Administration, 400 Seventh 
Street, SW., Washington, DC 20590. Docket hours are from 9:30 a.m. to 4 
p.m. Monday through Friday.

FOR FURTHER INFORMATION CONTACT: In NHTSA, Marlene Markison, Office of 
State and Community Services, 202-366-2121; John Donaldson, Office of 
the Chief Counsel. In FHWA, Mila Plosky, Office of Highway Safety, 202-
366-6902; Michael Falk, 202-366-0834.

SUPPLEMENTARY INFORMATION:

A. Statutory Requirements

    The Highway Safety Act of 1966 (23 U.S.C. 401 et seq.) established 
a formula grant program to improve highway safety in the States. As a 
condition of the grant, the Act provides that the States must meet 
certain requirements contained in 23 U.S.C. 402.
    Section 402(a) requires each State to have a highway safety 
program, approved by the Secretary of Transportation, which is designed 
to reduce traffic crashes and the deaths, injuries, and property damage 
resulting from those crashes. Section 402(b) sets forth the minimum 
requirements with which each State's highway safety program must 
comply. For example, the Secretary may not approve a program unless it 
provides that the Governor of the State is responsible for its 
administration through a State highway safety agency which has adequate 
powers and is suitably equipped and organized to carry out the program 
to the satisfaction of the Secretary. Additionally, the program must 
authorize political subdivisions of the State to carry out local 
highway safety programs and provide a certain minimum level of funding 
for these local programs each fiscal year. The enforcement of these and 
other continuing requirements is entrusted to the Secretary and, by 
delegation, to the National Highway Traffic Safety Administration 
(NHTSA) and the Federal Highway Administration (FHWA) (the agencies).
    When it was originally enacted in 1966, the Highway Safety Act 
required the agencies to establish uniform standards for State highway 
safety programs to assist States and local communities in implementing 
their highway safety programs. Eighteen such standards were established 
and, until 1976, the Section 402 program was directed principally 
toward achieving State and local compliance with these standards. Over 
time, State highway safety programs matured and, in 1976, the Highway 
Safety Act was amended to provide for more flexible implementation of 
the program. States were no longer required to comply with every 
uniform standard or with each element of every uniform standard. As a 
result, the standards became more like guidelines for use by the 
States, and management of the program shifted from enforcing standards 
to using the standards as a framework for problem identification, 
countermeasure development, and program evaluation. In 1987, Section 
402 of the Highway Safety Act was amended, formally changing the 
standards to guidelines.
    Another amendment to the Highway Safety Act required the Secretary 
to determine, through a rulemaking process, those programs ``most 
effective'' in reducing crashes, injuries, and deaths, taking into 
account ``consideration of the States having a major role in 
establishing (such) programs.'' The Secretary was authorized to revise 
the rule from time to time. The Act, as amended, provides that only 
those programs established under the rule as most effective in reducing 
crashes, injuries and deaths would be eligible for Federal financial 
assistance under the Section 402 program. In accordance with this 
provision, the agencies have identified, over time, nine such programs, 
the ``National Priority Program areas.'' These programs appear in a 
rule at 23 CFR part 1205, discussed further below, under the heading 
``Current Regulations.''

B. Current Regulations

1. Part 1200

    In recent years, the agencies have administered the Section 402 
program in accordance with an implementing regulation, Uniform 
Procedures for State Highway Safety Programs (23 CFR part 1200). That 
regulation, portions of which are amended by today's action, contains 
detailed procedures governing the content and Federal approval of a 
``Highway Safety Plan,'' to be submitted each fiscal year by the 
States. In particular, under the regulation each

[[Page 34398]]

State's highway safety plan is required to contain a ``problem 
identification summary,'' highlighting highway safety problems in the 
State, describing countermeasures planned to address those problems, 
and providing supporting statistical crash data. Additionally, in the 
highway safety plan, the State must describe and justify program areas 
to be funded, discuss planning and administration and training needs, 
and provide certain certifications and financial documentation.
    The regulation requires Federal approval for proposed expenditures 
within program areas, both under the State's initially submitted 
Highway Safety Plan and subsequently for any proposed changes in 
expenditures exceeding ten percent of the total amount in a given 
program area. Federal approval is also required, on a year-by-year 
basis, if a State wishes to continue a NHTSA project beyond three 
years. Such approval is conditioned on a showing that the project has 
demonstrated great merit or the potential for significant long-range 
benefits, and is subject to increased cost assumption by the State. The 
regulation provides the agencies with broad discretion to approve, 
conditionally approve, or disapprove a highway safety plan or any 
portion of the document. Agency approving officials are centrally 
involved in an evaluation of whether the highway safety plan 
establishes the existence of bona fide highway safety problems, 
identifies countermeasures and projects reasonably calculated to 
address the problems, and proposes an efficient use of Federal funds.
    Under the regulation, States are required to submit a comprehensive 
and detailed annual evaluation report. The annual report is required to 
contain a three-to-five page statewide overview of highway safety 
accomplishments, a description of projects conducted and costs incurred 
by program area, a discussion of legislative and administrative 
accomplishments, and a report on the status of remedial actions.
    The submission and approval requirements under the current Part 
1200 place a greater emphasis on Federal oversight of State highway 
safety programs than the agencies believe is necessary or desirable at 
this time. State highway safety programs have matured substantially 
since the inception of the Section 402 program. Accordingly, under the 
heading ``Changes to Regulation,'' the agencies discuss amendments to 
these portions of the regulation, made by today's notice, that provide 
the States more flexibility.
    Part 1200 contains other provisions, such as those concerning the 
apportionment and obligation of Federal funds, financial accounting 
(including submission of vouchers, program income, and the like), and 
closeout of each year's program. These provisions remain essentially 
unchanged by today's action.

2. Part 1205

    Today's action also amends portions of another regulation, 23 CFR 
part 1205, Highway Safety Programs; Determinations of Effectiveness. 
Part 1205 lists each highway safety program area that the agencies have 
determined, in accordance with the Highway Safety Act, to be most 
effective in reducing crashes, injuries, and deaths. The agencies have, 
through a series of rulemaking actions, as discussed above, identified 
these program areas as ``National Priority Program Areas.'' There are 
currently nine priority program areas: Alcohol and Other Drug 
Countermeasures, Police Traffic Services, Occupant Protection, Traffic 
Records, Emergency Medical Services, Motorcycle Safety, Roadway Safety, 
Pedestrian and Bicycle Safety, and Speed Control.
    Part 1205 currently provides for expedited funding approval of 
programs developed in any of the National Priority Program Areas. Part 
1205 provides that programs developed under other program areas may 
also be funded, but they must be approved under a more detailed 
approval process. As further described under the heading ``Changes to 
Regulation,'' today's notice provides States with more flexibility also 
with regard to their ability to fund these programs.

C. The Pilot Program

    In the years since the original enactment of Section 402, States 
have developed the infrastructure, tools, and resources necessary to 
conduct effective highway safety programs. Increasingly, States have 
expressed interest in assuming more responsibility for the planning and 
direction of their programs, with a decreased emphasis on the detailed 
Federal oversight that exists under the current regulation. Just as 
Congress earlier recognized the desirability of changing the mandatory 
standards to more flexible guidelines, the agencies believe it is 
appropriate at this time to provide the States with added flexibility 
to set their own goals, define their own performance measures, and 
determine the best means of accomplishing their goals, subject to the 
existing statutory parameters requiring overall program approval.
    Consistent with efforts to relieve burdens on the States under the 
President's regulatory reform initiative, the agencies took the first 
step in providing more flexibility for the States by establishing a 
pilot program in fiscal years1996 and 1997 for highway safety programs 
conducted under Section 402. The pilot program was announced in the 
Federal Register on September 12, 1995 (60 FR 47418) for fiscal year 
1996 and on September 6, 1996 (61 FR 46895) for fiscal year 1997.

1. Procedures

    The pilot program waived the requirement for State submission and 
Federal approval of the Highway Safety Plan required under part 1200 
for those States that chose to participate, and instead provided for a 
benchmarking process by which the States set their own highway safety 
goals and performance measures. Under the benchmarking process, 
participating States were required to submit a planning document and a 
benchmarking report, rather than the previously required highway safety 
plan. The planning document, which described how Federal funds would be 
used, consistent with the guidelines, priority areas, and other 
requirements of Section 402, was required to be approved by the 
Governor's Representative for Highway Safety.
    The States were required to submit the benchmark report to the 
agencies for approval by August 1 prior to the fiscal year for which 
the highway safety program was to be conducted.
    The benchmark report was required to contain three components: a 
Process Description, Performance Goals, and a Highway Safety Program 
Cost Summary. Under the Process Description component, States were 
required to describe the processes used to identify highway safety 
problems, establish performance goals, and develop the programs and 
projects in their plans. Under the Performance Goals component, States 
were required to identify highway safety performance goals (developed 
through a problem identification process) and to identify performance 
measures to be used to track progress toward each goal. Under the 
Highway Safety Program Cost Summary component, States submitted HS Form 
217, a financial accounting form that was previously required under 
part 1200.
    The focus of the Federal review and approval process under the 
pilot program shifted away from a review of the substantive details of 
the program, on a project-by-project basis, as required under part 
1200. Instead, the process

[[Page 34399]]

focused on verification that the State had committed itself, through a 
performance-based planning document approved by the Governor's 
Representative for Highway Safety and a benchmark report, to a highway 
safety program that targeted identified State highway safety concerns. 
The agencies waived the requirement under part 1200 that States seek 
approval for changes in expenditures exceeding ten percent in a given 
program area.
    Under the pilot program, the requirements governing the annual 
evaluation report were changed to accommodate the shift to a 
performance-based process. States were required to report on their 
progress toward meeting goals, using performance measures identified in 
the benchmark report, and the steps they took toward meeting goals. 
States were also required to describe State and community projects 
funded during the year.
    In other respects, the pilot program followed the requirements of 
part 1200 without change. Provisions concerning the submission of 
certifications and assurances, the apportionment and obligation of 
Federal funds, financial accounting (including submission of vouchers, 
program income, and the like), and the closeout of each year's program 
continued to apply to the pilot program.
    The Federal Register notices announcing the pilot program explained 
that, if the pilot program was successful, the agencies expected to 
revise the regulations governing State highway safety programs to adopt 
the pilot procedures permanently.

2. Experience Under the Pilot Program

    Over the two-year period during which the pilot program has been in 
place, it has met with support from States. Sixteen States participated 
in the pilot program during fiscal year 1996, and 41 States, the 
District of Columbia, Puerto Rico, the Virgin Islands, and the 
Commonwealth of the Northern Mariana Islands participated during fiscal 
year 1997. Most participating States expressed enthusiasm about the 
goal-setting process used in the pilot program, and felt a greater 
sense of ``ownership'' of their highway safety programs under the pilot 
procedures. Prior to their participation in the pilot program, many of 
these States had already adopted performance measures in their State 
budgeting and management processes, which eased the transition for 
these States to a performance-based process under the pilot program. 
The majority of participating States reported that the pilot program 
procedures resulted in reduced Federally-imposed burdens and increased 
State flexibility in administering their highway safety programs.
    In December 1996, the 16 States that participated in the pilot 
program during its initial year submitted their annual evaluation 
reports regarding their highway safety accomplishments under the pilot 
program. Overall, the reports revealed improvements in data systems, 
goal-setting, and project selection. They also reported reductions in 
costs and time expended for the administration of the program, and a 
broadening of highway safety partnerships. In addition, the reports 
revealed that pilot States are making steady progress toward achieving 
established goals. Experience to date confirms that the pilot program 
has resulted in the implement of successful highway safety programs, 
consistent with national highway safety goals and Federal goals for 
regulatory reform, streamlining procedures, and improvements in 
performance.
    In January 1997, during the second year of the pilot program, the 
agencies held a meeting that was attended by representatives of all 
States and territories. State representatives identified concerns and 
offered suggestions in an effort to make further improvements in the 
pilot program procedures. States generally expressed a desire for more 
flexibility, such as by extending the due date for submission of 
application documents, permitting a multi-year planning process, and 
accommodating short and long range goals in the goal-setting process. 
States agreed that, if progress toward meeting goals does not occur in 
a State, both State and Federal officials should cooperate to develop 
an improvement plan for the State.

D. Changes to the Regulation

1. In General

    Based on the success of the pilot program during its nearly two 
years of operation, today's interim final rule revises the regulations 
governing State highway safety programs to implement the pilot 
procedures. It also addresses issues raised during the January 1997 
meeting. It extends the due date for submission of application 
documents from August 1 to September 1, which is a change in both the 
pilot procedures and the procedures under part 1200. The interim final 
rule accommodates the States' desire for flexibility to plan and set 
goals covering time periods that best meet State needs. It also 
provides for a joint effort by Federal and State officials to develop 
an improvement plan, where a State fails to progress to meet goals. 
States are free at any time to request assistance or advice from the 
agencies' field offices, which remain ready to devote available 
resources as needed.
    This interim final rule replaces the existing procedures governing 
the preparation, submission, review, and approval of State Highway 
Safety Plans, contained in the Uniform Procedures for State Highway 
Safety Programs (23 CFR part 1200) and discussed generally under the 
heading ``Part 1200,'' above, with new procedures that are modeled 
after those used in the pilot program. The interim final rule requires 
the States to submit information detailing their highway safety 
programs in the same format as required under the pilot program. 
However, the rule makes some adjustments to the pilot program 
procedures, as discussed above.
    In addition, the interim final rule makes some changes in 
terminology from that used in the pilot program. The more descriptive 
terms ``performance plan'' and ``highway safety plan'' replace the 
terms ``benchmark report'' and ``planning document,'' which were used 
in the pilot program to describe State highway safety goals and planned 
activities. However, the functions of these documents remain 
essentially unchanged from those existing under the pilot program, as 
described under the heading ``The Pilot Program.'' (Retention of the 
familiar term ``highway safety plan'' is for convenience, and does not 
convey that procedures predating the pilot program continue to apply to 
that document.) States may choose (and are encouraged) to prepare their 
Performance Plan and Highway Safety Plan as comprehensive documents 
which also include goals and activities for highway safety programs 
other than the Section 402 program (such as Federal incentive grants). 
If this is done, the Highway Safety Plan should identify those programs 
or activities funded from other sources in a separate section or should 
identify them clearly in some other manner.
    Under the interim final rule, the nature of the Federal approval 
process has been changed. Instead of approving a highway safety plan 
based on a project-by-project justification, the agencies instead will 
review the State's highway safety program as a whole, to verify that 
the State has developed a goal-oriented highway safety program that has 
been approved by the Governor's Representative for Highway Safety, and 
that identifies the State's highway safety problems, establishes

[[Page 34400]]

goals and performance measures to effect improvements in highway 
safety, and describes activities designed to achieve those goals. When 
establishing performance measures, States may wish to consult the 
``Examples of Performance Measures'' section of the Pilot State Highway 
Safety Program Notice of Waiver published in the Federal Register on 
September 5, 1996 (61 FR 46895).
    The agencies have retained the requirement, contained in both part 
1200 and the pilot procedures, that States must submit an annual 
report. However, the interim final rule changes the contents of the 
annual report from those required by part 1200 (described under the 
heading ``Part 1200''). Under the interim final rule, the States are 
required to describe their progress in meeting State highway safety 
goals, using performance measures identified in the Performance Plan, 
and the projects and activities funded during the fiscal year. They 
must also include in these reports an explanation of how these projects 
and activities contributed to meeting the State's highway safety goals.
    The agencies believe that the performance-based process, which 
places the States in charge of determining the best means of improving 
traffic safety within their borders, is an effective means of ensuring 
the proper identification of highway safety problems and the efficient 
deployment of resources to address those problems. Experience under the 
pilot program confirms that States are uniquely qualified to assess 
their highway safety deficiencies, and that they are able to 
effectively address these deficiencies by establishing goals and using 
performance measures, without the need for detailed Federal review at 
the project level.
    No substantive changes have been made to provisions relating to the 
apportionment and obligation of Federal funds, financial accounting, 
and the like. These sections of the regulation are being republished in 
this notice simply for ease of reference.

2. Highlighted Provisions

    In order to complete the change to procedures modeled after those 
of the pilot program, and to improve clarity and organization, the 
agencies have made certain other changes to part 1200. For example, the 
requirement that States must seek Federal approval before implementing 
program changes (including changes exceeding ten percent of the funding 
in a program area), has been replaced with a simple notification 
requirement in the interim final rule, consistent with the pilot 
program procedures. This change reduces administrative burdens and 
increases the States' ability to make efficient adjustments to their 
programs. The section on equipment has been simplified in the interim 
final rule, making it easier to follow. There are no longer separate 
definitions for major and non-major equipment since, for most purposes, 
all equipment used in the Section 402 program is treated alike. 
Instead, within the section on equipment, a paragraph concerning major 
purchases and dispositions identifies the threshold at which Federal 
approval is necessary.
    The agencies have made some structural refinements throughout the 
regulation to improve clarity or to include useful information or 
cross-references. For example, the interim final rule changes, deletes, 
or streamlines some definitions, where they are no longer needed or 
where the text of the proposed rule is sufficiently clear without the 
definition. The interim final rule also sets forth the minimum 
statutory requirements for approval of a state highway safety program 
(responsibility of the Governor for program administration, 
participation by political subdivisions, access for handicapped 
persons, and programs for use of safety belts). These elements have 
been longstanding requirements of the Section 402 program under the 
Highway Safety Act, and are restated in the interim final rule for 
convenience. Additionally, the interim final rule includes a cross-
reference to sanctions required by the Highway Safety Act to be imposed 
for failure to have or to implement a highway safety program, also for 
convenience.
    The agencies have changed the definition of ``approving official,'' 
due to a change in the appropriation process for the Section 402 
program. In fiscal year 1997, Congress placed all Section 402 funding 
under NHTSA's appropriation, while retaining separate authorizing 
legislation for the Section 402 program for both NHTSA and the FHWA. 
(Previously, NHTSA and the FHWA had separate appropriations as well as 
authorizations for the Section 402 program.) As a result, NHTSA has 
assumed the lead responsibility for administration of the Section 402 
program, though the agencies will continue to coordinate many 
decisions. The proposed definition reflects this new relationship.
    The agencies have deleted the requirement that States must seek 
Federal approval and assume a greater share of project costs prior to 
continuing a NHTSA-funded project or activity beyond three years. Over 
the years, this requirement has been used to ensure that NHTSA funds 
are predominantly used as ``seed money,'' to assist states with the 
start-up of innovative new projects whose implementation would later be 
taken over by the State. With the change to a performance-based 
program, the agencies no longer are involved in project-by-project 
review, and this project-level approval provision is no longer 
appropriate. However, States are encouraged to develop their own ``seed 
money'' and cost sharing requirements for local highway safety projects 
and activities, to stimulate the continued introduction of innovative 
new solutions to highway safety problems at the local level. The 
agencies are pleased to note that several States (e.g., Florida, 
Georgia, and Mississippi) have developed and are implementing such 
requirements.
    Finally, this interim final rule makes conforming changes to the 
funding procedures for National Priority Program Areas and other 
program areas, appearing in 23 CFR part 1205, Highway Safety Programs; 
Determinations of Effectiveness, consistent with the agencies' 
objectives of placing more decisionmaking responsibilities in the hands 
of the States. With these changes, States can now pursue activities in 
program areas identified either by the agencies as National Priority 
Program areas or by the States as State priorities. In pursuing 
activities under the latter category, States will be required to 
identify programs that address problems of State concern and for which 
effective countermeasures have been identified. The current regulation 
specifies a formal process for approval of activities under program 
areas identified by the States and requires detailed Federal review. 
Under this interim final rule, States are given more flexibility in the 
processes they may use to identify program areas that are State 
priorities, and the level of Federal oversight has been reduced.
    A number of other requirements apply to the Section 402 program, 
including those appearing in other parts of Chapter II of Title 23 CFR, 
and such government-wide provisions as the Uniform Administrative 
Requirements for Grants and Cooperative Agreements to State and Local 
Governments (49 CFR part 18) and the Office of Management and Budget 
(OMB) Circulars containing cost principles and audit requirements 
(e.g., OMB Circulars A-21, A-87, A-122, A-128, and A-133). These 
provisions are unaffected by today's notice, and continue to apply in 
accordance with their terms.

[[Page 34401]]

E. Regulatory Analyses and Notices

Executive Order 12612 (Federalism)

    This action has been analyzed in accordance with the principles and 
criteria contained in Executive Order 12612, and it has been determined 
that it does not have sufficient Federalism implications to warrant the 
preparation of a Federalism assessment. This action increases the 
flexibility of the States by implementing a performance-based process 
under which the States are responsible for setting highway safety 
goals, in accordance with their individual needs. In other respects, 
this action is consistent with the procedures of a common rule for the 
administration of grants to State and local governments (49 CFR part 
18) which has as its basis the principles of Federalism, and which 
recognizes that States possess unique constitutional authority, 
resources, and competence to administer national grant programs, and 
provides for the application of State laws and procedures to many 
aspects of grant administration.

Executive Order 12778 (Civil Justice Reform)

    This rule does not have any preemptive or retroactive effect. It 
merely revises existing requirements imposed on States to afford States 
more flexibility in implementing a grant program. The enabling 
legislation does not establish a procedure for judicial review of final 
rules promulgated under its provisions. There is no requirement that 
individuals submit a petition for reconsideration or pursue other 
administrative proceedings before they may file suit in court.

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

    The agencies have determined that this action is not a significant 
regulatory action within the meaning of Executive Order 12866 or 
significant within the meaning of Department of Transportation 
Regulatory Policies and Procedures. This rule does not impose any 
additional burden on the public, but rather reduces burdens and 
improves the flexibility afforded to States in implementing highway 
safety programs. This action does not affect the level of funding 
available in the highway safety program. Accordingly, neither a 
Regulatory Impact Analysis nor a full Regulatory Evaluation is 
required.

Regulatory Flexibility Act

    In compliance with the Regulatory Flexibility Act (5 U.S.C. 601 et 
seq.), the agencies have evaluated the effects of this action on small 
entities. We hereby certify that this action will not have a 
significant economic impact on a substantial number of small entities. 
States are the recipients of any funds awarded under the Section 402 
program. The preparation of a Regulatory Flexibility Analysis is 
unnecessary.

Paperwork Reduction Act

    The requirement relating to this action, that each State must 
submit certain documents to receive Section 402 grant funds, is 
considered to be an information collection requirement, as that term is 
defined by OMB. This information collection requirement has been 
previously submitted to and approved by OMB, pursuant to the provisions 
of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.). The 
requirement has been approved through September 30, 1998; OMB Control 
No. 2127-0003.

Environmental Impacts

    The agencies have reviewed this action for the purpose of 
compliance with the National Environmental Policy Act (42 U.S.C. 4321 
et seq.) and have determined that it will not have a significant effect 
on the human environment.

F. Interim Final Rule

    This notice is published as an interim final rule, without prior 
notice and opportunity to comment. Because this regulation relates to a 
grant program, the requirements of the Administrative Procedure Act 
(APA), 5 U.S.C. 553, are not applicable. Moreover, even if the notice 
and comment provisions of the APA did apply, the agencies believe that 
there is good cause for finding that providing notice and comment in 
connection with this rulemaking action is impracticable, unnecessary, 
and contrary to the public interest, since it would delay the 
availability of guidance to States concerning new procedures applicable 
to fiscal year 1998 highway safety programs under 23 U.S.C. 402. States 
require this information well in advance of the start of the fiscal 
year to which the highway safety program applies in order to comply 
with application procedures and to allow sufficient time for program 
planning activities. This finding is further supported because the 
amendments made in this interim final rule are consistent with the 
provisions of a pilot program whose procedures are already known to the 
States. The pilot program is in its second year of operation, with most 
States participating, and its procedures were closely coordinated with 
the States prior to the start of the pilot program. For these reasons, 
the agencies also believe that there is good cause to make the rule 
effective immediately upon publication.
    As an interim final rule, this regulation is fully in effect and 
binding upon its effective date. No further regulatory action by the 
agencies is necessary to make the rule effective. However, in order to 
benefit from comments which interested parties and the public may have, 
the agencies are requesting that comments be submitted to the docket 
for this notice. All comments submitted in response to this notice, in 
accordance with the procedures outlined below, will be considered by 
the agency. Following the close of the comment period, the agencies 
will publish a notice responding to the comments and, if appropriate, 
the agencies will amend the provisions of this rule.

G. Comments to the Docket

    The agencies are providing a 45-day comment period for interested 
parties to present data, views, and arguments concerning this notice. 
The agencies invite comments on the issues raised in this notice and 
any other issues commenters believe are relevant to this action. 
Comments must not exceed 15 pages in length (49 CFR 553.21). This 
limitation is intended to encourage commenters to detail their primary 
arguments in a concise fashion. Necessary attachments may be appended 
to these submissions without regard to the 15-page limit.
    All comments received by the close of business on the comment 
closing date indicated above will be considered and will be available 
for examination in the docket at the above address both before and 
after that date. To the extent possible, comments filed after the 
closing date will also be considered. However, the rulemaking action 
may proceed at any time after that date. Following the close of the 
comment period, the agencies will publish a notice responding to the 
comments and, if appropriate, the agencies will amend the provisions of 
this rule. The agencies will continue to file relevant material in the 
docket as it becomes available after the closing date, and it is 
recommended that interested persons continue to examine the docket for 
new material.
    Those persons desiring to be notified of receipt of their comments 
by the docket should enclose a self-addressed, stamped postcard in the 
envelope with their comments. Upon receipt of the comments, the docket 
supervisor will return the postcard by mail.

[[Page 34402]]

    Copies of all comments will be placed in Docket 93-55, Notice 5 of 
the NHTSA Docket Section in Room 5109, Nassif Building, 400 Seventh 
Street, SW., Washington, DC 20590.

List of Subjects in 23 CFR Parts 1200 and 1205

    Grant programs--transportation, Highway safety.

    For the reasons set out in the preamble, title 23, chapter II of 
the Code of Federal Regulations is amended as set forth below.
    1. Subchapter A, part 1200, is revised to read as follows:

SUBCHAPTER A--PROCEDURES FOR STATE HIGHWAY SAFETY PROGRAMS

PART 1200--UNIFORM PROCEDURES FOR STATE HIGHWAY SAFETY PROGRAMS

Subpart A--General

Sec.
1200.1  Purpose.
1200.2  Applicability.
1200.3  Definitions.

Subpart B--Application, Approval, and Funding of the Highway Safety 
Program

1200.10  Application.
1200.11  Special funding conditions.
1200.12  Due date.
1200.13  Approval.
1200.14  Apportionment and obligation of Federal funds.

Subpart C--Implementation and Management of the Highway Safety Program

1200.20  General.
1200.21  Equipment.
1200.22  Changes.
1200.23  Vouchers and project agreements.
1200.24  Program income.
1200.25  Improvement plan.
1200.26  Non-compliance.
1200.27  Appeals.

Subpart D--Closeout

1200.30  Expiration of the right to incur costs.
1200.31  Extension of the right to incur costs.
1200.32  Final voucher.
1200.33  Annual report.
1200.34  Disposition of unexpended balances.
1200.35  Post-grant adjustments.
1200.36  Continuing requirements.

    Authority: 23 U.S.C. 402; delegations of authority at 49 CFR 
1.48 and 1.50.

Subpart A--General


Sec. 1200.1  Purpose.

    This part establishes uniform application, approval, 
implementation, and closeout procedures for State highway safety 
programs authorized under 23 U.S.C. 402.


Sec. 1200.2  Applicability.

    The provisions of this part apply to highway safety programs 
conducted by States under 23 U.S.C. 402.


Sec. 1200.3  Definitions.

    As used in this subchapter--
    Approving Official means a Regional Administrator of the National 
Highway Traffic Safety Administration, with the concurrence of a 
Division Administrator of the Federal Highway Administration as 
necessary.
    Carry-forward funds means those funds that a State has obligated 
but not expended in the fiscal year in which they were apportioned, 
that are being reprogrammed to fund activities in a subsequent fiscal 
year.
    Contract authority means the statutory language that authorizes the 
agencies to incur an obligation without the need for a prior 
appropriation or further action from Congress and which, when 
exercised, creates a binding obligation on the United States for which 
Congress must make subsequent liquidating appropriations.
    Equipment means any tangible personal property acquired for use 
under the State's approved highway safety program.
    FHWA means the Federal Highway Administration.
    Fiscal year means the Federal fiscal year, consisting of twelve 
months beginning each October 1 and ending the following September 30.
    Governor means the Governor of any of the fifty States, Puerto 
Rico, the Virgin Islands, Guam, American Samoa, or the Commonwealth of 
the Northern Mariana Islands, the Mayor of the District of Columbia, 
or, for the application of this part to Indians as provided in 23 
U.S.C. 402(i), the Secretary of the Interior.
    Governor's Representative for Highway Safety means the official 
appointed by the Governor to implement the State's highway safety 
program or, for the application of this part to Indians as provided in 
23 U.S.C. 402(i), an official of the Bureau of Indian Affairs who is 
duly designated by the Secretary of the Interior to implement the 
Indian highway safety program.
    NHTSA means the National Highway Traffic Safety Administration.
    Program area means a National Priority Program Area identified in 
Sec. 1205.3 of this chapter or a program area identified by the State 
in the highway safety plan as encompassing a major highway safety 
problem in the State and for which effective countermeasures have been 
identified.
    Program income means gross income received by the State or any of 
its subgrantees or contractors that is directly or indirectly generated 
by a Federally-supported project during the project performance period.
    Section 402 means section 402 of title 23 of the United States 
Code.
    State means any of the fifty States of the United States, the 
District of Columbia, Puerto Rico, the Virgin Islands, Guam, American 
Samoa, the Commonwealth of the Northern Mariana Islands, or, for the 
application of this part to Indians as provided in 23 U.S.C. 402(i), 
the Secretary of the Interior.

Subpart B--Application, Approval, and Funding of the Highway Safety 
Program


Sec. 1200.10  Application.

    Each fiscal year, a State's application for funds for its highway 
safety program shall consist of the following components:
    (a) A Performance Plan, containing the following elements:
    (1) A list of objective and measurable highway safety goals, within 
the National Priority Program Areas and other program areas, based on 
highway safety problems identified by the State during the processes 
under paragraph (a)(2) of this section. Each goal must be accompanied 
by at least one performance measure that enables the State to track 
progress, from a specific baseline, toward meeting the goal (e.g., a 
goal to ``increase safety belt use from XX percent in 19__ to YY 
percent in 20__,'' using a performance measure of ``percent of 
restrained occupants in front outboard seating positions in passenger 
motor vehicles'').
    (2) A brief description of the processes used by the State to 
identify its highway safety problems, define its highway safety goals 
and performance measures, and develop projects and activities to 
address its problems and achieve its goals. In describing these 
processes, the State shall identify the participants in the processes 
(e.g., highway safety committees, community and constituent groups), 
discuss the strategies for project or activity selection (e.g., 
constituent outreach, public meetings, solicitation of proposals), and 
list the information and data sources consulted.
    (b) A Highway Safety Plan, approved by the Governor's 
Representative for Highway Safety, describing the projects and 
activities the State plans to implement to reach the goals identified 
in the Performance Plan. The Highway Safety Plan must, at a minimum, 
describe one year of activities.
    (c) A Certification Statement, signed by the Governor's 
Representative for

[[Page 34403]]

Highway Safety, providing assurances that the State will comply with 
applicable laws and regulations, financial and programmatic 
requirements, and in accordance with Sec. 1200.11 of this part, the 
special funding conditions of the Section 402 program.
    (d) A Program Cost Summary (HS Form 217), completed to reflect the 
State's proposed allocations of funds (including carry-forward funds) 
by program area, based on the goals identified in the Performance Plan 
and the projects and activities identified in the Highway Safety Plan. 
The funding level used shall be an estimate of available funding for 
the upcoming fiscal year.


Sec. 1200.11  Special funding conditions.

    The State's highway safety program under Section 402 shall be 
subject to the following conditions, and approval under Sec. 1200.13 of 
this part shall in no event be deemed to waive these conditions:
    (a) Responsibility of the Governor--The Governor of the State shall 
be responsible for the administration of the Section 402 program 
through a State highway safety agency that shall have adequate powers 
and be suitably equipped and organized to carry out the program.
    (b) Participation by Political Subdivisions--Political subdivisions 
shall be authorized to carry out local highway safety programs, 
approved by the Governor, as a part of the State highway safety 
program, and at least 40 percent of all Federal funds provided under 
this part shall be used by or for the benefit of political 
subdivisions, in accordance with the provisions of part 1250 of this 
chapter.
    (c) Access for Persons with Disabilities--Adequate and reasonable 
access shall be provided for the safe and convenient movement of 
persons with physical disabilities, including those in wheelchairs, 
across curbs constructed or replaced on or after July 1, 1976, at all 
pedestrian crosswalks throughout the State.
    (d) Use of Safety Belts--Programs shall be provided (which may 
include financial incentives and disincentives) to encourage the use of 
safety belts by drivers and passengers in motor vehicles.
    (e) Planning and Administration Costs--Funding and matching 
requirements for planning and administration costs shall be in 
accordance with the provisions of part 1252 of this chapter.
    (f) Purchase and Disposition of Equipment--Major purchases and 
dispositions of equipment shall require prior approval by the approving 
official, in accordance with the provisions of Sec. 1200.21(d) of this 
part.


Sec. 1200.12  Due date.

    Three copies of the application documents identified in 
Sec. 1200.10 of this part must be received by the NHTSA regional office 
no later than September 1 preceding the fiscal year to which the 
documents apply. The NHTSA regional office will forward copies to NHTSA 
headquarters and the FHWA division office. Failure to meet this 
deadline may result in delayed approval and funding.


Sec. 1200.13  Approval.

    (a) Upon receipt of application documents complying with the 
provisions of Sec. 1200.10 and Sec. 1200.11 of this part, the Approving 
Official will issue a letter of approval to the Governor and the 
Governor's Representative for Highway Safety.
    (b) The approval letter identified in paragraph (a) of this section 
will contain the following statement:

    We have reviewed (STATE)'s __________ fiscal year 19__ 
Performance Plan, Highway Safety Plan, Certification Statement, and 
Cost Summary (HS Form 217), as received on (DATE) ____________. 
Based on these submissions, we find your State's highway safety 
program to be in compliance with the requirements of the Section 402 
program. This determination does not constitute an obligation of 
Federal funds for the fiscal year identified above or an 
authorization to incur costs against those funds. The obligation of 
Section 402 program funds will be effected in writing by the NHTSA 
Administrator at the commencement of the fiscal year identified 
above. However, Federal funds reprogrammed from the prior-year 
Highway Safety Program (carry-forward funds) will be available for 
immediate use by the State on October 1. Reimbursement will be 
contingent upon the submission of an updated HS Form 217, consistent 
with the requirements of 23 CFR 1200.14(d), within 30 days after 
either the beginning of the fiscal year identified above or the date 
of this letter, whichever is later.

    (c) If approval is withheld, for reasons of non-compliance with 
Sec. 1200.10 or Sec. 1200.11 of this part or other applicable law, the 
Approving Official shall identify in writing the specific area(s) of 
non-compliance which formed the basis for withholding approval.


Sec. 1200.14  Apportionment and obligation of Federal funds.

    (a) Except as provided in paragraph (b) of this section, on October 
1 of each fiscal year the NHTSA Administrator shall, in writing, 
distribute funds available for obligation under Section 402 to the 
States and specify any conditions or limitations imposed by law on the 
use of the funds.
    (b) In the event that authorizations exist but no applicable 
appropriation act has been enacted by October 1 of a fiscal year the 
NHTSA and FHWA Administrators shall, in writing, distribute a part of 
the funds authorized under Section 402 contract authority to ensure 
program continuity and shall specify any conditions or limitations 
imposed by law on the use of the funds. Upon appropriation of Section 
402 funds, the NHTSA Administrator shall, in writing, promptly adjust 
the obligation limitation, and specify any conditions or limitations 
imposed by law on the use of the funds.
    (c) The funds distributed under paragraph (a) or (b) of this 
section shall be available for expenditure by the states to satisfy the 
Federal share of expenses under the approved highway safety program, 
and shall constitute a contractual obligation of the Federal 
Government, subject to any conditions or limitations identified in the 
distributing document.
    (d)(1) Notwithstanding the provisions of paragraph (c) of this 
section, reimbursement of State expenses shall be contingent upon the 
submission of an updated HS Form 217, within 30 days after either the 
beginning of the fiscal year or the date of the written approval 
required under Sec. 1200.13 of this part, whichever is later.
    (2) The updated HS Form 217 required under paragraph (d)(1) of this 
section shall reflect the State's allocation of Section 402 funds made 
available for expenditure during the fiscal year, including known 
carry-forward funds.

Subpart C--Implementation and Management of the Highway Safety 
Program


Sec. 1200.20  General.

    Except as otherwise provided in this subpart and subject to the 
provisions herein, the requirements of 49 CFR part 18 and applicable 
cost principles govern the implementation and management of State 
highway safety programs carried out under 23 U.S.C. 402. Cost 
principles include those referenced in 49 CFR 18.22 and those set forth 
in applicable Department of Transportation, NHTSA, or FHWA Orders.


Sec. 1200.21  Equipment.

    (a) Title. Except as provided in paragraphs (e) and (f) of this 
section, title to equipment acquired under the Section 402 program will 
vest upon acquisition in the State or its subgrantee, as appropriate.

[[Page 34404]]

    (b) Use. All equipment shall be used for the originally authorized 
grant purposes for as long as needed for those purposes, as determined 
by the Approving Official, and neither the State nor any of its 
subgrantees or contractors shall encumber the title or interest while 
such need exists.
    (c) Management and disposition. Subject to the requirement of 
paragraphs (b), (d), (e) and (f) of this section, States and their 
subgrantees and contractors shall manage and dispose of equipment 
acquired under the Section 402 program in accordance with State laws 
and procedures.
    (d) Major Purchases and dispositions. All purchases and 
dispositions of equipment with a useful life of more than one year and 
an acquisition cost of $5,000 or more must receive prior written 
approval from the Approving Official.
    (e) Right to transfer title. The Approving Official may reserve the 
right to transfer title to equipment acquired under the Section 402 
program to the Federal Government or to a third party when such third 
party is otherwise eligible under existing statutes. Any such transfer 
shall be subject to the following requirements:
    (1) The equipment shall be identified in the grant or otherwise 
made known to the State in writing;
    (2) The Approving Official shall issue disposition instructions 
within 120 calendar days after the equipment is determined to be no 
longer needed in the Section 402 program, in the absence of which the 
State shall follow the applicable procedures in 49 CFR part 18.
    (f) Federally-owned equipment. In the event a State or its 
subgrantee is provided Federally-owned equipment:
    (1) Title shall remain vested in the Federal Government;
    (2) Management shall be in accordance with Federal rules and 
procedures, and an annual inventory listing shall be submitted;
    (3) The State or its subgrantee shall request disposition 
instructions from the Approving Official when the item is no longer 
needed in the Section 402 program.


Sec. 1200.22  Changes.

    States shall provide documentary evidence of any reallocation of 
funds between program areas by submitting to the NHTSA regional office 
an amended HS form 217, reflecting the changed allocation of funds, 
within 30 days of implementing the change.


Sec. 1200.23  Vouchers and project agreements

    Each State shall submit official vouchers for total expenses 
incurred to the Approving Official. Copies of the project agreement(s) 
and supporting documentation for the vouchers, and any amendments 
thereto, shall be made available for review by the Approving Official 
upon request.
    (a) Content of vouchers. At a minimum, each voucher shall provide 
the following information for expenses claimed in each program area:
    (1) Program Area;
    (2) Federal funds obligated;
    (3) Amount of Federal funds allocated to local benefit (provided 
mid-year (by March 31) and with the final voucher);
    (4) Cumulative Total Cost to Date;
    (5) Cumulative Federal Funds Expended;
    (6) Previous Amount Claimed;
    (7) Amount Claimed this Period;
    (8) Matching rate (or Special matching writeoff used, i.e., sliding 
scale rate authorized under 23 U.S.C. 120(a), determined in accordance 
with the applicable NHTSA Order).
    (b) Submission requirements. At a minimum, vouchers shall be 
submitted to the Approving Official on a quarterly basis, no later than 
15 working days after the end of each quarter, except that where a 
State receives funds by electronic transfer at an annualized rate of 
one million dollars or more, vouchers shall be submitted on a monthly 
basis, no later than 15 working days after the end of each month. 
Failure to meet these deadlines may result in delayed reimbursement.


Sec. 1200.24  Program income.

    (a) Inclusions. Program income includes income from fees for 
services performed, from the use or rental of real or personal property 
acquired with grant funds, from the sale of commodities or items 
fabricated under the grant agreement, and from payments of principal 
and interest on loans made with grant funds.
    (b) Exclusions. Program income does not include interest on grant 
funds, rebates, credits, discounts, refunds, taxes, special 
assessments, levies, fines, proceeds from the sale of real property or 
equipment, income from royalties and license fees for copyrighted 
material, patents, and inventions, or interest on any of these.
    (c) Use of program income.--(1) Addition. Program income shall 
ordinarily be added to the funds committed to the Highway Safety Plan. 
Such program income shall be used to further the objectives of the 
program area under which it was generated.
    (2) Cost sharing or matching. Program income may be used to meet 
cost sharing or matching requirements only upon written approval of the 
Approving Official. Such use shall not increase the commitment of 
Federal funds.


Sec. 1200.25  Improvement Plan

    If a review of the Annual Report required under Sec. 1200.33 of 
this part or of other relevant information indicates little or no 
progress toward meeting State goals, the Approving Official and State 
officials will jointly develop an improvement plan. This plan will 
detail strategies, program activities, and funding targets to meet the 
defined goals.


Sec. 1200.26  Non-Compliance.

    Where a State is found to be in non-compliance with the 
requirements of the Section 402 program or with applicable law, the 
special conditions for high-risk grantees and the enforcement 
procedures of 49 CFR part 18, or the sanctions procedures of part 1206 
of this chapter, may be applied as appropriate.


Sec. 1200.27  Appeals.

    Review of any written decision by an Approving Official under this 
part may be obtained by submitting a written appeal of such decision, 
signed by the Governor's Representative for Highway Safety, to the 
Approving Official. Such appeal shall be forwarded promptly to the 
NHTSA Associate Administrator for State and Community Services or the 
FHWA Regional Administrator with jurisdiction over the specific 
division, as appropriate. The decision of the NHTSA Associate 
Administrator or FHWA Regional Administrator shall be final and shall 
be transmitted to the Governor's Representative for Highway Safety 
through the cognizant Approving Official.

Subpart D--Closeout


Sec. 1200.30  Expiration of the right to incur costs.

    Unless extended in accordance with the provisions of Sec. 1200.31 
of this part, the right to incur costs under Section 402 expires on the 
last day of the fiscal year to which it pertains. The State and its 
subgrantees and contractors may not incur costs for Federal 
reimbursement past the expiration date.


Sec. 1200.31  Extension of the right to incur costs.

    Upon written request by the State, specifying the reasons therefor, 
the Approving Official may extend the right to incur costs for some 
portion of the State highway safety program by a maximum of 90 days. 
The approval of

[[Page 34405]]

any such request for extension shall be in writing, shall specify the 
new expiration date, and shall be signed by the Approving Official. If 
an extension is granted, the State and its subgrantees and contractors 
may continue to incur costs in accordance with the Highway Safety Plan 
until the new expiration date, and the due dates for other submissions 
covered by this subpart shall be based upon the new expiration date. 
However, in no case shall any extension be deemed to authorize the 
obligation of additional Federal funds beyond those already obligated 
to the State, nor shall any extension be deemed to extend the due date 
for submission of the Annual Report. Only one extension shall be 
allowed during each fiscal year.


Sec. 1200.32  Final voucher.

    Each State shall submit a final voucher which satisfies the 
requirements of Sec. 1200.23(a) of this part within 90 days after the 
expiration of each fiscal year, unless extended in accordance with the 
provisions of Sec. 1200.31 of this part. The final voucher constitutes 
the final financial reconciliation for each fiscal year.


Sec. 1200.33  Annual report.

    Within 90 days after the end of the fiscal year, each State shall 
submit an Annual Report. This report shall describe:
    (a) The State's progress in meeting its highway safety goals, using 
performance measures identified in the Performance Plan. Both baseline 
and most current level of performance under the performance measure 
will be given for each goal.
    (b) The projects and activities funded during the fiscal year, 
including an explanation of how each of these projects and activities 
contributed to meeting the State's highway safety goals.


Sec. 1200.34  Disposition of unexpended balances.

    Any funds which remain unexpended after final reconciliation shall 
be carried forward, credited to the State's highway safety account for 
the new fiscal year, and made immediately available for use under the 
State's new highway safety program, subject to the approval 
requirements of Sec. 1200.13 of this part. Carry-forward funds must be 
identified by the program area from which they are removed when they 
are reprogrammed from the previous fiscal year. Once so identified, 
such funds are available for use without regard to the program area 
from which they were carried forward, unless specially earmarked by the 
Congress.


Sec. 1200.35  Post-grant adjustments.

    The closeout of a highway safety program in a fiscal year does not 
affect the ability of NHTSA or FHWA to disallow costs and recover funds 
on the basis of a later audit or other review or the State's obligation 
to return any funds due as a result of later refunds, corrections, or 
other transactions.


Sec. 1200.36  Continuing requirements.

    The following provisions shall have continuing applicability, 
notwithstanding the closeout of a highway safety program in a fiscal 
year:
    (a) The requirements governing equipment, as provided in 
Sec. 1200.21 of this part;
    (b) The audit requirements and records retention and access 
requirements of 49 CFR part 18.

PART 1205--HIGHWAY SAFETY PROGRAMS; DETERMINATIONS OF EFFECTIVENESS

    2. The authority citation for part 1205 continues to read as 
follows:

    Authority: 23 U.S.C. 402; delegations of authority at 49 CFR 
1.48 and 1.50.

    3. Section 1205.4 is revised to read as follows:


Sec. 1205.4  Funding requirements.

    A State may use funds made available under 23 U.S.C. 402 to support 
projects and activities within--
    (a) Any National priority program area identified in Sec. 1205.3 of 
this part; or
    (b) Any other highway safety program area that is identified in the 
Highway Safety Plan required under Sec. 1200.10(b) of this chapter as 
encompassing a major highway safety problem in the State and for which 
effective countermeasures have been identified.


Sec. 1205.5  [Removed]

    4. Section 1205.5 is removed.

    Issued on: June 23, 1997.
Jane F. Garvey,
Acting Administrator, Federal Highway Administration.
Ricardo Martinez,
Administrator, National Highway Traffic Safety Administration.
[FR Doc. 97-16779 Filed 6-25-97; 8:45 am]
BILLING CODE 4910-59-P