[Federal Register Volume 62, Number 234 (Friday, December 5, 1997)]
[Notices]
[Pages 64456-64501]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-31910]


      

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Part IV





Department of Transportation





_______________________________________________________________________



Federal Transit Administration



_______________________________________________________________________



FTA Fiscal Year 1998 Apportionments, Allocations and Program 
Information; Notice

  Federal Register / Vol. 62, No. 234 / Friday, December 5, 1997 / 
Notices  

[[Page 64456]]



DEPARTMENT OF TRANSPORTATION

Federal Transit Administration


FTA Fiscal Year 1998 Apportionments, Allocations and Program 
Information

AGENCY: Federal Transit Administration (FTA), DOT.

ACTION: Notice.

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SUMMARY: The Department of Transportation (DOT) and Related Agencies 
Appropriations Act, 1998 (Pub. L. 105-66), was signed into law by 
President Clinton on October 27, 1997. Pending further consideration of 
a multi-year authorization next Spring, Congress has passed a six-month 
extension of the Intermodal Surface Transportation Efficiency Act of 
1991 (ISTEA), known as the Surface Transportation Extension Act of 
1997. This act, signed by President Clinton on December 1, 1997, 
provides additional funding authorizations for the transit, highway, 
and highway safety programs for the period October 1, 1997, through 
March 31, 1998. The previous authorizations, under ISTEA, were 
effective through September 30, 1997.
    Funding for the Federal Transit Administration (FTA) is derived 
from two sources: the general funds of the Treasury and motor fuel 
taxes deposited into the Mass Transit Account of the Highway Trust 
Fund. The 1998 DOT Appropriations Act provides $240,000,000 in general 
funds for the formula programs under 49 U.S.C. Sections 5307, 5311, and 
5310. It also provides general funds in the amount of $52,250,000 for 
the transit planning and research programs of 49 U.S.C. Sections 5303, 
5313(b), and 5311(b). The Surface Transportation Extension Act of 1997 
provides an additional $1,328,400,000 for formula programs in the form 
of contract authority from the Mass Transit Account for a total of 
$1,568,400,000 for the formula programs.
    The capital programs are funded exclusively with trust funded 
resources. The Surface Transportation Extension Act of 1997 provides 
$1,131,600,000 in new contract authority, consisting of $452,640,000 
each for the Fixed Guideway Modernization and New Starts categories and 
$226,320,000 for the Bus category. The obligational authority for New 
Starts when combined with $392,000,000 in unobligated contract 
authority for New Starts remaining under ISTEA exceeds the obligation 
limitation in the 1998 DOT Appropriations Act of $800,000,000. 
Therefore, this notice contains allocations to make $800,000,000 for 
New Starts available for obligation.
    This Notice contains (1) a listing of the full amount of the fiscal 
year 1998 apportionments and allocations for the formula, capital, and 
transit planning and research programs, including both trust funds and 
general funds, based on the 1998 Appropriations Act and Federal transit 
laws; and (2) a listing of apportionments and allocations based on the 
fiscal year 1998 available funds for the Urbanized Area Formula 
Program, the Nonurbanized Area Formula Program, the Elderly and Persons 
with Disabilities Program, the Rural Transit Assistance Program, the 
Capital Program, the Metropolitan Planning Program, and the State 
Planning and Research program, in accordance with the 1998 DOT 
Appropriations Act and the Surface Transportation Extension Act of 
1997. As soon as authorizing legislation covering the remainder of the 
fiscal year, April 1, 1998, through September 30, 1998, has been 
enacted, the entire apportionment will be made available. If the 
reauthorization act affects the distribution of funds within the 
programs, FTA will republish the apportionments and allocations in 
their entirety, taking the provisions of both the 1998 DOT 
Appropriations Act and the reauthorization act into consideration. In 
any case, even though the Surface Transportation Extension Act of 1997 
provides contract authorizations for the period October 1, 1997, 
through March 31, 1998, funding is available to grantees throughout the 
typical period of availability for each specific program. For example, 
Urbanized Area Formula Program funding is available to the grantees for 
fiscal year 1998 plus the next three years through fiscal year 2001. In 
the interim, grantees are able to obligate the fiscal year 1998 
available apportionments, allocations, and carryover balances remaining 
under the various FTA formula and capital programs.
    Also included in this Notice is a listing of prior year unobligated 
earmarks for the Section 5309 New Starts and Bus Programs as in 
previous year notices. In addition, the FTA policy regarding pre-award 
authority to incur project costs, as well as other pertinent program 
information, is included.

FOR FURTHER INFORMATION CONTACT: The appropriate FTA Regional 
Administrator for grant-specific information and issues; Patricia 
Levine, Director, Office of Resource Management and State Programs, 
(202) 366-2053, for general information about the Urbanized Area 
Formula Program, the Nonurbanized Area Formula Program, the Elderly and 
Persons with Disabilities Program, the Rural Transit Assistance 
Program, or the Capital Program; or Robert Stout, Director, Office of 
Planning Operations, (202) 366-6385, for general information concerning 
the Metropolitan Planning Program and the State Planning and Research 
Program.

SUPPLEMENTARY INFORMATION:

TABLE OF CONTENTS

I. BACKGROUND
II. OVERVIEW OF APPROPRIATIONS FOR GRANT PROGRAMS
    A. General
    B. Funds Available for Obligation
    C. Project Management Oversight
III. EXPANDED DEFINITION OF CAPITAL
    A. Preventive Maintenance
    B. Operating Assistance for Urbanized Areas Less Than 200,000 In 
Population
IV. DEPARTMENTAL INITIATIVES
    A. FTA Home Page on the Internet
    B. State Infrastructure Banks
V. SECTION 5307 URBANIZED AREA FORMULA PROGRAM
    A. Total Urbanized Area Formula Apportionments
    B. Data Used for Urbanized Area Formula Apportionments
    C. Adjustments for Energy and Operating Efficiencies
    D. Urbanized Area Formula Fiscal Year 1998 Apportionments to 
Governors
    E. Urbanized Area Formula Operating Assistance Limitations
    F. Statewide Operating Assistance Limitations
    G. Designated Transportation Management Areas
    H. Urbanized Area Formula Funds Used for Highway Purposes
VI. SECTION 5311 NONURBANIZED AREA FORMULA PROGRAM AND SECTION 
5311(b) RURAL TRANSIT ASSISTANCE PROGRAM (RTAP)
    A. Nonurbanized Area Formula Program
    B. Rural Transit Assistance Program (RTAP)
VII. SECTION 5310 ELDERLY AND PERSONS WITH DISABILITIES PROGRAM
VIII. SURFACE TRANSPORTATION PROGRAM ``FLEXIBLE'' FUNDS USED FOR 
TRANSIT PURPOSES (Title 23, U.S.C.)
    A. Transfer Process
    B. Matching Share for Flexible Funds
    C. Other Funds Transferred to FTA
IX. SECTION 5309 CAPITAL PROGRAM
    A. Fixed Guideway Modernization
    B. New Starts
    C. Bus
X. UNIT VALUES OF DATA FOR SECTION 5307 URBANIZED AREA FORMULA 
PROGRAM, SECTION 5311 NONURBANIZED AREA FORMULA PROGRAM, AND SECTION 
5309 FIXED GUIDEWAY MODERNIZATION PROGRAM
XI. SECTION 5303 METROPOLITAN PLANNING PROGRAM AND SECTION 5313(b) 
STATE PLANNING AND RESEARCH PROGRAM

[[Page 64457]]

    A. Metropolitan Planning Program
    B. State Planning and Research Program
    C. Data Used for Metropolitan Planning Apportionments and State 
Planning and Research Apportionments
    D. FHWA Metropolitan Planning Program and State Planning and 
Research Program
    E. Local Match Waiver for Job Access Planning Activities
    F. Planning Emphasis Areas
    G. Federal Planning Certification Reviews
    H. Consolidated Planning Grant
XII. PERIOD OF AVAILABILITY OF FUNDS
XIII. NOTICE OF PRE-AWARD AUTHORITY TO INCUR PROJECT COSTS
    A. Background
    B. Current Coverage
    C. Conditions
    D. Environmental, Planning and Other Requirements
XIV. RAIL FIXED GUIDEWAY SYSTEMS: STATE SAFETY OVERSIGHT (49 CFR 
PART 659)
XV. ELECTRONIC GRANT MAKING AND MANAGEMENT INITIATIVES
    A. Background
    B. Graphical User Interface
    C. Fiscal Year 1998 Emphasis
XVI. 1998 ANNUAL LIST OF CERTIFICATIONS AND ASSURANCES
XVII. QUARTERLY APPROVAL OF GRANTS
XVIII. GRANT APPLICATION PROCEDURES
TABLES
    1. FTA FY 1998 APPROPRIATIONS AND FUNDS AVAILABLE FOR GRANT 
PROGRAMS
    2. FTA FY 1998 SECTION 5307 URBANIZED AREA FORMULA 
APPORTIONMENTS
    3. FTA FY 1998 SECTION 5311 NONURBANIZED AREA FORMULA 
APPORTIONMENTS, AND SECTION 5311(b) RURAL TRANSIT ASSISTANCE PROGRAM 
(RTAP) ALLOCATIONS
    4. FTA FY 1998 Section 5310 elderly and persons with 
disabilities apportionments
    5. FTA FY 1998 sectuib 5309 fixed guideway modernization 
apportionments
    6. FTA FY 1998 section 5309 new start allocations
    6A. FTA prior year unobligated section 5309 new start 
allocations
    7. FTA FY 1998 section 5309 bus allocations
    7A. FTA prior year unobligated section 5309 BUS allocations
    8. FTA FY 1998 section 5303 metropolitan planning apportionments 
and section 5313(b) state planning and research apportionments
    9. Unit values of data--FTA FY 1998 formula grant apportionments

I. Background

    Urbanized Area Formula Program funds are apportioned by statutory 
formula to urbanized areas and to the Governors to provide capital, 
operating and planning assistance in urbanized areas. Nonurbanized Area 
Formula Program funds are apportioned by statutory formula to the 
Governors for capital, operating and administrative assistance in 
nonurbanized areas. The Elderly and Persons with Disabilities Program 
funds are apportioned by statutory formula to the Governors to provide 
capital assistance to organizations providing transportation service 
for the elderly and persons with disabilities. Fixed Guideway 
Modernization funds are apportioned by statutory formula to specified 
urbanized areas for capital improvements in rail and other fixed 
guideways. Funds appropriated for the Metropolitan Planning Program are 
apportioned by a statutory formula to the Governors for allocation by 
them to Metropolitan Planning Organizations (MPOs) in urbanized areas 
or portions thereof. Appropriated funds for the State Planning and 
Research Program also are apportioned to states by a statutory formula. 
New Start funds identified for specific projects in the 1998 DOT 
Appropriations Act and Bus fund allocations in the accompanying 
Conference Report are also included in this Notice.

II. Overview of Appropriations for Grant Programs

A. General

    In fiscal year 1998, the appropriation and obligation limitation 
for the Urbanized Area Formula Program and the Nonurbanized Area 
Formula Program is $2,437,780,611. Of this amount, 94.50 percent 
($2,303,702,677) would be available to the Urbanized Area Formula 
Program, and 5.50 percent ($134,077,934) would be available to the 
Nonurbanized Area Formula Program. The other program appropriations 
contained in this Notice are as follows: $4,500,000 for the Rural 
Transit Assistance Program (RTAP); $62,219,389 for the Elderly and 
Persons with Disabilities Program; $39,500,000 for the Metropolitan 
Planning Program; $8,250,000 for the State Planning and Research 
Program; and $2,000,000,000 in obligation limitation for the Capital 
Program. Of the Capital Program amount, $800,000,000 is for Fixed 
Guideway Modernization, $800,000,000 is for New Starts, and 
$400,000,000 is for Bus.
    Table 1 displays the amounts of obligation limitation and 
appropriations for these programs, including adjustments and final 
apportionment and allocation amounts. Also included is a listing of 
amounts for the formula and capital programs based on the fiscal year 
1998 available funds. The following text provides a narrative 
explanation for the funding levels and other factors affecting these 
apportionments and allocations.

B. Funds Available for Obligation

    Because the Surface Transportation Extension Act of 1997 only 
provides contract authority through March 31, 1998, FTA is publishing 
both (1) the apportionment and allocation tables that contain the full 
program levels in the DOT Appropriations Act for fiscal year 1998; and 
(2) the apportionments and allocations based on the fiscal year 1998 
available funds for the various programs. The column titled ``FY 1998 
Apportionment'' includes both trust funds (contract authority) and 
general funds, and does not represent the amount that is actually 
available for obligation at this time. Rather, it reflects the total 
dollar amount of obligation limitation and appropriations in the 1998 
DOT Appropriations Act, once a full year contract authority is made 
available. Only funds shown in the column titled ``FY 1998 Available 
Apportionment,'' may be obligated pending further reauthorizing 
legislation.

C. Project Management Oversight

    49 U.S.C. Section 5327 allows the Secretary of Transportation to 
use not more than one-half of one percent of the funds made available 
under the Capital Program; the Urbanized Area Formula Program, the 
Nonurbanized Area Formula Program; the National Capital Transportation 
Act, as amended; and an additional one-quarter of one percent of 
Capital Program funds to contract with any person to oversee the 
construction of any major project under these statutory programs and to 
conduct safety, procurement, management and financial reviews and 
audits.
    The 1998 DOT Appropriations Act states ``That none of the funds in 
this Act shall be available for the execution of contracts under 
section 5327(c) of title 49, United States Code, in an aggregate amount 
that exceeds $15,000,000.'' Accordingly, the Project Management 
Oversight (PMO) amount takes into account both the 1998 DOT 
Appropriations Act and Federal transit laws. The obligation limitation 
and appropriations for the Sections 5307, 5311, and 5309 Programs, and 
the National Capital Transportation Act, as amended, total 
$4,637,780,611. The higher amount as authorized under Federal transit 
laws was reduced to the $15,000,000 required by the 1998 DOT 
Appropriations Act by taking a pro rata reduction across all categories 
of the four programs. Therefore, .32343056 of one percent of the funds 
appropriated within the obligation limitation and appropriation for the 
Urbanized Area Formula Program; the Nonurbanized

[[Page 64458]]

Area Formula Program; the Capital Program; and the National Capital 
Transportation Act, as amended, for fiscal year 1998, have been 
reserved for these purposes before apportionment of the funds.

III. Expanded Definition of Capital

A. Preventive Maintenance

    Effective for fiscal year 1998, preventive maintenance will be 
eligible for Federal assistance as a capital expense with a Federal/
local share ratio of 80/20 in the FTA formula programs. Thus preventive 
maintenance is an eligible capital cost under the Section 5307 
Urbanized Area Formula Program; the Section 5310 Elderly and Persons 
with Disabilities Program; and the Section 5311 Nonurbanized Area 
Formula Program. This provision does not apply to the Section 5309 
Capital Program. This change implements Section 316 of the 1998 DOT 
Appropriations Act, in which Congress amended the definition of an 
eligible capital project under the FTA formula programs to add 
preventive maintenance.
    Since the DOT Appropriations Act covers only Federal fiscal year 
1998, this new policy applies only to funds within the obligation 
limitation and appropriation in the DOT Appropriations Act for fiscal 
year 1998. It does not apply to carryover funds apportioned in previous 
years.
    Preventive maintenance costs for fiscal year 1998 are defined as 
all maintenance costs. For general guidance as to the definition of 
eligible maintenance costs, the grantee should refer to the definition 
of maintenance in the most recent National Transit Database (NTD) 
reporting manual. During fiscal year 1998 a grantee may continue to 
request assistance for capital expenses under the FTA policies 
governing associated capital maintenance items (spare parts), 
maintenance of vehicles leased under contract, and vehicle overhauls; 
or a grantee may choose to capture all maintenance under preventive 
maintenance, and also may continue to request operating assistance 
within the grantee's operating assistance limitation at the 50/50 match 
share. However, a grantee may not count the same costs twice. 
Preventive maintenance costs eligible for FTA capital assistance from 
fiscal year 1998 appropriations are those costs incurred by a grantee 
within a local fiscal year ending during calendar 1997, or thereafter. 
If a grantee purchases service instead of operating service directly, 
and maintenance is included in the contract for that purchased service, 
then the grantee may apply for capital assistance under preventive 
maintenance for the actual maintenance costs of the purchased service.
    For accounting purposes, the grantee is cautioned not to confuse 
the fact that an item generally considered to be an operating expense 
is now eligible for FTA capital assistance. Generally accepted 
accounting principles and the grantee's accounting system determine 
those costs that are to be accounted for as operating costs. The 
National Transit Database Reporting System (NTD) follows generally 
accepted accounting principles, and so a grantee reporting to the NTD 
must report the operating costs the grantee has incurred as operating 
regardless of grant eligibility as capital. Nevertheless, under 
provisions of the fiscal year 1998 Appropriations Act, some of those 
operating costs, while continuing to be accounted for as operating 
costs in the grantee's accounting records, are now eligible for FTA 
capital assistance.

B. Operating Assistance for Urbanized Areas Less Than 200,000 in 
Population

    Section 316 of the 1998 DOT Appropriations Act further amended the 
definition of a capital project to include ``financing the operating 
costs of equipment and facilities used in mass transportation in 
urbanized areas with a population of less than 200,000''.
    A grantee in an urbanized area of less than 200,000 in population 
may elect to employ this amended definition of capital and request 80 
percent Federal assistance for funding net operating expenses, or the 
grantee may choose to use the fiscal year 1998 operating assistance 
limitations published in this notice and apply for operating assistance 
at the 50 percent Federal share. If operating expenses are applied for 
as capital costs, the operating assistance limitation does not apply. 
The net operating expenses eligible for capital funding under the 
amended definition of capital will be determined according to guidance 
in FTA Circular 9030.1B, Appendix D. As for preventive maintenance, 
only fiscal year 1998 funds may be used for operating assistance as a 
capital cost.

IV. Departmental Initiatives

A. FTA Home Page on the Internet

    FTA provides extended customer service by making available transit 
information on the FTA Home Page web site, including this Apportionment 
Notice. Also posted on the web site are FTA program circulars: 
C9030.1B, Urbanized Area Formula Program: Grant Application 
Instructions, dated October 10, 1996; C9040.1D, Nonurbanized Area 
Formula Program Guidance and Grant Application Instructions, dated May 
8, 1997; C9070.1D, Elderly and Persons with Disabilities Program 
Guidance and Application Instructions, dated October 22, 1997; C9300.1, 
Capital Program: Grant Application Instructions, dated September 29, 
1995; 4220.1D, Third Party Contracting Requirements, dated April 15, 
1996; C5010.1B, Grant Management Guidelines, dated September 7, 1995; 
and C8100.1B, Program Guidance and Application Instructions for 
Metropolitan Planning Program Grants, dated October 25, 1996. The 
fiscal year 1998 Annual List of Certifications and Assurances is also 
posted on the FTA web site. Other documents on the FTA web site of 
particular interest to public transit providers and users include the 
1996 Statistical Summaries of FTA Grant Assistance Programs, and the 
National Transit Database Profiles.
    The FTA Home Page may be accessed at: http://www.fta.dot.gov. FTA 
circulars and other guidance are at: http://www.fta.dot.gov/program.
    Grantees should check our web site frequently to keep up to date on 
new postings.

B. State Infrastructure Banks

    The State Infrastructure Bank (SIB) pilot program was authorized in 
the National Highway System Designation Act of 1995. It allows the 
creation of state-level institutions that can use Federal Highway 
Administration (FHWA) and FTA funds to make loans and loan guarantees 
(and other forms of credit enhancement) to transit and highway 
projects. The SIBs may earn interest on deposits of Federal funds, and 
they may charge below-market interest rates on long-term loans.
    In 1996, ten (10) states were designated to establish SIBs. On June 
19, 1997, an additional 29 states were designated to participate in the 
SIB Pilot Program. The Secretary of Transportation has awarded 
$150,000,000 in capitalization funding to these 29 designated states.

V. Section 5307 Urbanized Area Formula Program

A. Total Urbanized Area Formula Apportionments

    In addition to the appropriated fiscal year 1998 Urbanized Area 
Formula funds of $2,303,702,677, the apportionment also includes 
$7,162,381 in deobligated funds which have become available for 
reapportionment for the Urbanized Area Formula

[[Page 64459]]

Program as provided by 49 U.S.C. 5336(i).
    Table 2 displays the amount apportioned for the Urbanized Area 
Formula Program. After the .32343056 of one percent for PMO is reserved 
($7,450,879), the amount appropriated for this program is 
$2,296,251,798. The funds to be reapportioned, described in the 
previous paragraph, have then been added. Thus, the total amount 
apportioned for this program is $2,303,414,179.
    Table 2 also shows by urbanized area and state the amount of funds 
which are currently available. The total of $1,444,234,826 includes 
$1,441,735,458 in fiscal year 1998 trust funded contract authority and 
general fund appropriation, $7,162,381 in deobligated funds from 
previous years which have become available for reapportionment, minus 
$4,663,013 for PMO. The available operating assistance limitation in 
the amount of $150,000,000 is also shown on Table 2.

B. Data Used for Urbanized Area Formula Apportionments

    Data from the 1996 NTD (49 U.S.C. 5335) Report Year submitted in 
late 1996 and early 1997 have been used to calculate the fiscal year 
1998 Urbanized Area Formula apportionments for urbanized areas 200,000 
in population and over. The population and population density figures 
used in calculating the Urbanized Area Formula are from the 1990 
Census.

C. Adjustments for Energy and Operating Efficiencies

    49 U.S.C. 5336(b)(2)(E) provides that, if a recipient of Urbanized 
Area Formula Program funds demonstrates to the satisfaction of the 
Secretary that energy or operating efficiencies would be achieved by 
actions that reduce revenue vehicle miles but provide the same 
frequency of revenue service to the same number of riders, the 
recipient's apportionment under 49 U.S.C. 5336(b)(2)(A)(i) shall not be 
reduced as a result of such actions. One recipient has submitted data 
acceptable to FTA in accordance with this provision. Accordingly, the 
revenue vehicle miles used in the Urbanized Area Formula database to 
calculate the fiscal year 1998 Urbanized Area Formula apportionment 
reflect the amount the recipient would have received without the 
reductions in mileage.

D. Urbanized Area Formula Fiscal Year 1998 Apportionments to Governors

    The total Urbanized Area Formula apportionment to the Governor for 
use in areas under 200,000 in population for each state is shown on 
Table 2. Table 2 also contains the total apportionment amount 
attributable to each of the urbanized areas within the state. The 
Governor may determine the allocation of funds among the urbanized 
areas under 200,000 in population with one exception. As further 
discussed below in Section G, funds attributed to an urbanized area 
under 200,000 in population, located within the planning boundaries of 
a transportation management area, must be obligated in that area.

E. Urbanized Area Formula Operating Assistance Limitations

    The fiscal year 1998 limitations on the amount of Urbanized Area 
Formula funds that may be used for operating assistance are shown on 
Table 2 with the fiscal year 1998 apportionment.
    The operating assistance limitations for all urbanized areas have 
been adjusted by 49 U.S.C. 5336(d)(2) to reflect the increase in the 
Consumer Price Index (CPI) for all urban consumers during the most 
recent calendar years. The CPI Detailed Report, December 1996, 
published by the Department of Labor (DOL), establishes that the 
calendar year 1996 CPI increase for all urban consumers is 3.3 percent. 
This increase was applied against the base operating assistance 
limitation calculated in accordance with 49 U.S.C. 5336(d)(2).
    These adjustments result in an overall national fiscal year 1998 
authorized operating assistance limitation level of $1,178,642,366. 
However, the 1998 DOT Appropriations Act limits the nationwide 
availability for operating assistance to a maximum of $150,000,000. 
Further, it maintains the level of transit operating assistance to 
urbanized areas of less than 200,000 in population at 75 percent of the 
amount of operating assistance such areas received in fiscal year 1995. 
Accordingly, the operating assistance limitation published in this 
Notice takes into account both the 1998 DOT Appropriations Act and 
Federal transit laws. Therefore, the higher operating assistance 
limitation as authorized under Federal transit laws ($1,178,642,366) 
was reduced to the $150,000,000 required by the 1998 DOT Appropriations 
Act by taking a pro rata reduction across all categories of grantees. 
Further, the operating assistance limitation to urbanized areas less 
than 200,000 in population was adjusted to $92,949,803 or 75 percent of 
the amount of their fiscal year 1995 level of $123,933,070.
    The operating assistance limitation of $85,791 for Flagstaff, 
Arizona (a newly designated urbanized area under 200,000 in fiscal year 
1996), was then added to the amount of the fiscal year 1995 level, 
thereby increasing the fiscal year 1998 level for these areas to 
$93,035,594. The remaining $56,964,406 of the $150,000,000 was prorated 
to urbanized areas above 200,000 in population, as authorized by the 
1998 DOT Appropriations Act.
    Consistent with the 1998 Conference Report, the Secretary hereby 
directs each area of 1,000,000 or more in population to give priority 
consideration to the impact of reductions in operating assistance on 
smaller transit authorities operating within the area, and to consider 
the needs and resources of such transit authorities when the limitation 
is distributed among all transit authorities operating in the area.

F. Statewide Operating Assistance Limitations

    49 U.S.C. 5307(f) specifies that in any case in which a statewide 
agency or instrumentality is responsible under state laws for the 
financing, construction and operation, directly, by lease, contract or 
otherwise, of public transportation services, and when such statewide 
agency or instrumentality is the designated recipient of FTA funds, and 
when the statewide agency or instrumentality provides service among two 
or more urbanized areas, the statewide agency or instrumentality shall 
be allowed to apply for operating assistance up to the combined total 
permissible amount of all urbanized areas in which it provides service, 
regardless of whether the amount for any particular urbanized area is 
exceeded. However, the amount of operating assistance provided for 
another state or local transportation agency within the affected 
urbanized areas may not be reduced.

G. Designated Transportation Management Areas

    All urbanized areas over 200,000 in population have been designated 
as transportation management areas (TMAs), in accordance with 49 U.S.C. 
Section 5305. These designations were formally made in a Federal 
Register notice dated May 18, 1992 (57 FR 21160), signed by the Federal 
Highway Administrator and the Federal Transit Administrator. Additional 
areas may be designated as TMAs upon the request of the Governor and 
the MPO designated for such area or the affected local officials. As of 
October 1, 1997, two additional TMAs have been formally designated: 
Petersburg, Virginia, comprised solely of the Petersburg,

[[Page 64460]]

Virginia, urbanized area; and Santa Barbara, Santa Maria, and Lompoc, 
California, which were combined and designated as one TMA.
    Guidance for setting the boundaries of TMAs is contained in the 
joint transportation planning regulations codified at 23 CFR part 450 
and 49 CFR part 613. In some cases, the TMA boundaries, which have been 
established by the MPO for the designated TMA, also include one or more 
urbanized areas with less than 200,000 in population. Where this 
situation exists, the discretion of the Governor to allocate Urbanized 
Area Formula program ``Governor's Apportionment'' funds for urbanized 
areas with less than 200,000 in population is restricted.
    As required by 49 U.S.C. 5307(a)(2), a recipient(s) must be 
designated to dispense the Urbanized Area Formula funds attributable to 
TMAs. Those urbanized areas that do not already have a designated 
recipient must name one and notify the appropriate FTA regional office 
of the designation. This would include those urbanized areas with less 
than 200,000 in population that may receive TMA designation 
independently, or those with less than 200,000 in population which are 
currently included within the boundaries of a larger designated TMA. In 
both cases, the Governor would only have discretion to allocate 
Governor's Apportionment funds attributable to areas which are outside 
of designated TMA boundaries. In order for the FTA and Governors to 
know which urbanized areas under 200,000 in population are included 
within the boundaries of an existing TMA, and so that they can be 
identified in future Federal Register notices, each MPO whose TMA 
planning boundaries include these smaller urbanized areas is asked to 
identify such areas to the FTA. This notification should be made in 
writing to the Associate Administrator for Program Management, Federal 
Transit Administration, 400 Seventh Street, SW, Washington, DC 20590, 
no later than July 1 of each fiscal year. To date, FTA has been 
notified of the following urbanized areas with less than 200,000 in 
population that are included within the planning boundaries of 
designated TMAs:

----------------------------------------------------------------------------------------------------------------
           Designated TMA                           Small urbanized area included in TMA boundaries             
----------------------------------------------------------------------------------------------------------------
Baltimore, Maryland.................  Annapolis, Maryland.                                                      
Dallas-Fort Worth, Texas............  Denton, Texas.                                                            
                                      Lewisville, Texas.                                                        
Houston, Texas......................  Galveston, Texas.                                                         
                                      Texas City, Texas.                                                        
Orlando, Florida....................  Kissimmee, Florida.                                                       
Philadelphia, Pennsylvania..........  Pottstown, Pennsylvania.                                                  
Pittsburgh, Pennsylvania............  Monessen, Pennsylvania.                                                   
                                      Steubenville-Weirton, OH-WV-PA (PA portion).                              
Seattle, Washington.................  Bremerton, Washington.                                                    
Washington, DC-MD-VA................  Frederick, Maryland (MD portion).                                         
----------------------------------------------------------------------------------------------------------------

H. Urbanized Area Formula Funds Used for Highway Purposes

    Urbanized Area Formula funds apportioned to a TMA, except for those 
amounts which can be used for the payment of operating expenses, are 
also available for highway projects if the following three conditions 
are met: (1) Such use must be approved by the MPO after appropriate 
notice and opportunity for comment and appeal are provided to affected 
transit providers; (2) in the determination of the Secretary, such 
funds are not needed for investments required by the Americans with 
Disabilities Act of 1990 (ADA); and (3) funds may be available for 
highway projects under title 23, U.S.C., only if funds used for the 
state or local share of such highway projects are eligible to fund 
either highway or transit projects.
    Urbanized Area Formula funds which are designated for highway 
projects will be transferred to and administered by the Federal Highway 
Administration (FHWA). The MPO should notify FTA of its intent to 
program FTA funds for highway purposes.

VI. Section 5311 Nonurbanized Area Formula Program and Section 5311(b) 
Rural Transit Assistance Program (RTAP)

A. Nonurbanized Area Formula Program

    The fiscal year 1998 Nonurbanized Area Formula apportionments to 
the states totaling $134,819,045 are displayed in Table 3. Of the 
$134,077,934 appropriated, .32343056 of one percent ($433,649) was 
reserved for PMO. In addition to the current appropriation and 
obligation limitation, the funds available for apportionment include 
$1,174,760 in deobligated funds from fiscal years prior to 1996.
    Table 3 also shows a state-by-state apportionment of the amount of 
funds which are currently available. The total of $84,813,897 includes 
$83,910,529 in fiscal year 1998 trust funded contract authority and 
general fund appropriation, $1,174,760 in prior year carryover 
available to be reapportioned, minus $271,392 for PMO.
    The population figures used in calculating these apportionments are 
from the 1990 Census.
    The Nonurbanized Formula Program provides capital, operating and 
administrative assistance for areas less than 50,000 in population. 
Each state must spend no less than 15 percent of its fiscal year 1998 
Nonurbanized Area Formula apportionment for the development and support 
of intercity bus transportation, unless the Governor certifies to the 
Secretary that the intercity bus service needs of the state are being 
adequately met. Fiscal year 1998 Nonurbanized Area Formula grant 
applications must reflect this level of programming for intercity bus 
or include a certification from the Governor.

B. Rural Transit Assistance Program (RTAP)

    The fiscal year 1998 RTAP allocations to the states totaling 
$4,678,778 are also displayed on Table 3. This amount includes 
$4,500,000 in fiscal year 1998 appropriated funds, and $178,778 in 
prior year deobligated funds, which have become available for 
reallocation for this program.
    Table 3 also shows a state-by-state allocation of RTAP funds. RTAP 
is totally general funded in fiscal year 1998; therefore, the entire 
appropriated amount of $4,500,000 is currently available plus $178,778 
in reapportioned funds.

[[Page 64461]]

    The funds are allocated to the states to undertake research, 
training, technical assistance, and other support services to meet the 
needs of transit operators in nonurbanized areas. These funds are to be 
used in conjunction with the states' administration of the Nonurbanized 
Area Formula Program.

VII. Section 5310 Elderly and Persons With Disabilities Program

    A total of $62,221,661 is apportioned to the states for fiscal year 
1998 for the Elderly and Persons with Disabilities Program. In addition 
to the fiscal year 1998 appropriation of $62,219,389, the fiscal year 
1998 apportionment also includes $2,272 in prior year unobligated funds 
which have become available for reapportionment for the Elderly and 
Persons with Disabilities Program. Table 4 shows each state's 
apportionment.
    Table 4 also shows a state-by-state allocation of the amount of 
funds which are currently available. The total of $42,756,285 includes 
$42,754,013 in fiscal year 1998 trust funded contract authority and 
general fund appropriation, and $2,272 in reapportioned funds.
    The formula for apportioning these funds uses 1990 Census 
population data for persons aged 65 and over and for persons with 
disabilities.
    The funds provide capital assistance for transportation for elderly 
persons and persons with disabilities. Eligible capital expenses may 
include, at the option of the recipient, the acquisition of 
transportation services by a contract, lease, or other arrangement.
    While the assistance is intended primarily for private non-profit 
organizations, public bodies that coordinate services for the elderly 
and persons with disabilities, or any public body that certifies to the 
state that non-profit organizations in the area are not readily 
available to carry out the service, may receive these funds.
    These funds may be transferred by the Governor to supplement the 
Urbanized Area Formula or Nonurbanized Area Formula capital funds 
during the last 90 days of the fiscal year.

VIII. Surface Transportation Program ``Flexible'' Funds Used for 
Transit Purposes (Title 23, U.S.C.)

A. Transfer Process

    ``Flexible'' DOT funds, such as Surface Transportation Program 
(STP) funds, Congestion Mitigation and Air Quality (CMAQ) funds, or 
others, which are designated for use in transit projects, are 
transferred from the FHWA to FTA after which FTA approves the project 
and awards a grant. Flexible funds designated for transit projects must 
result from the metropolitan and state planning and programming 
process, and must be included in an approved State Transportation 
Improvement Program (STIP) before the funds can be transferred. In 
order to initiate the transfer process, the grantee must submit a 
completed application to the FTA Regional Office, and must notify the 
state highway/transportation agency that it has submitted an 
application which requires a transfer of funds. Once the state highway/
transportation agency determines that the state has sufficient 
obligation authority, the state agency notifies FHWA that the funds are 
to be used for transit purposes and requests that the funds be 
obligated by FHWA as a transfer project to FTA. The flexible funds 
transferred to FTA will be placed in an urbanized area or state account 
for one of the three existing formula programs--Urbanized Area, 
Nonurbanized Area, or Elderly and Persons with Disabilities.
    The flexible funds are then treated as FTA formula funds, although 
they retain a special identifying code. They may be used for any 
purpose eligible under these FTA programs except for operating 
expenses. All FTA requirements are applicable to transferred funds. 
Flexible funds should be combined with regular FTA formula funds in a 
single annual grant application.

B. Matching Share for Flexible Funds

    The provisions of Title 23, U.S.C. regarding the non-Federal share 
apply to Title 23 funds used for transit projects. Thus, flexible funds 
transferred to FTA retain the same matching share that the funds would 
have if used for highway purposes and administered by the FHWA.
    There are three instances in which a higher than 80 percent Federal 
share would be maintained. First, in states with large areas of Indian 
and certain public domain lands, and national forests, parks and 
monuments, the local share for highway projects is determined by a 
sliding scale rate, calculated based on the percentage of public lands 
within that state. This sliding scale, which permits a greater Federal 
share, but not to exceed 95 percent, is applicable to transit projects 
funded with flexible funds in these public land states. FHWA develops 
the sliding scale matching ratios for the increased Federal share.
    Secondly, commuter carpooling and vanpooling projects and transit 
safety projects using flexible funds administered by FTA may retain the 
same 100 percent Federal share that would be allowed for ride-sharing 
or safety projects administered by the FHWA. The third instance 
includes the 100 percent Federal safety projects; however, these are 
subject to a nationwide 10 percent program limitation.

C. Other Funds Transferred to FTA

    Certain demonstration projects authorized in Title 23 are specified 
to be used for transit projects and are more appropriately administered 
by FTA. In such cases, FHWA has transferred the funds to FTA for 
administration. Since these funds are not STP flexible funds, they are 
transferred into the appropriate Capital Program category (Bus, New 
Starts, or Fixed Guideway Modernization) for obligation and are 
administered as Capital projects.

IX. Section 5309 Capital Program

A. Fixed Guideway Modernization

    Fixed Guideway Modernization funds are allocated by formula. 
Statutory percentages were established to allocate the first 
$497,700,000 to 11 fixed guideway areas. The next $70,000,000 is 
allocated one-half to these 11 urbanized areas and one-half to other 
urbanized areas with fixed guideways which are at least seven years old 
on the basis of the Urbanized Area Formula Program fixed guideway tier 
formula factors. The remaining funds are allocated to all of these 
urbanized areas as one universe. For fiscal year 1998, there is a 
$800,000,000 obligation limitation for fixed guideway modernization. 
After deducting the .32343056 of one percent for oversight 
($2,587,445), $797,412,555 would be available for apportionment to the 
specified urbanized areas for Fixed Guideway Modernization funding. 
Table 5 displays these apportionments.
    Table 5 also shows a state and area allocation of the fiscal year 
1998 funds which are currently available. The total of $451,176,024 
includes $452,640,000 in fiscal year 1998 trust funded contract 
authority, minus $1,463,976 for PMO, distributed on a pro rata basis as 
directed in the Surface Transportation Extension Act of 1997.
    Funds apportioned for this section must be used for capital 
projects to modernize or improve fixed guideway systems. The expanded 
definition of capital to include preventive maintenance does not apply 
to the Fixed Guideway Modernization Program.
    All urbanized areas with fixed guideway systems that are at least 
seven years old are eligible to receive Fixed Guideway Modernization 
funds. A

[[Page 64462]]

request for the start-up service dates for fixed guideways has been 
incorporated into the NTD reporting system to ensure that all eligible 
fixed guideway data is included in the calculation of these 
apportionments. A threshold level of more than one mile of fixed 
guideway is required to receive Fixed Guideway Modernization funds. 
Therefore, urbanized areas reporting one mile or less of fixed guideway 
mileage under the NTD are not included. Urbanized areas should be aware 
that the formula allocating Fixed Guideway Modernization funds may be 
changed under a new authorization act.

B. New Starts

    The fiscal year 1998 obligation limitation for New Starts is 
$800,000,000.
    The Project Management Oversight (PMO) reduction was applied to 
this amount and subtracted on a pro rata basis from all 65 projects 
specified in the 1998 DOT Appropriations Act. For fiscal year 1998, 
this amount is $2,587,445. This amount was computed by applying 
.32343056 of one percent to the obligation limitation. After 
subtracting this amount from the $800,000,000, a total of $797,412,555 
is available for obligation. The final allocation for each of these 
projects, which also reflects the PMO reduction, is contained in Table 
6 of this Federal Register notice.
    The Surface Transportation Extension Act of 1997 provides 
$452,640,000 for New Starts. This obligational authority for New Starts 
when combined with $392,000,000 in unobligated contract authority for 
New Starts remaining under ISTEA exceeds the obligation limitation in 
the 1998 Appropriations Act of $800,000,000. Therefore, $800,000,000 
minus $2,587,445 for PMO is currently available.
    Prior year unobligated appropriations for New Starts in the amount 
of $299,434,442 remain available for obligation in fiscal year 1998. 
These allocations are displayed in Table 6A.

C. Bus

    The fiscal year 1998 obligation limitation for Bus is $400,000,000. 
In addition Congress reprogrammed $975,000 in unobligated Bus funds 
originally appropriated in fiscal year 1995, yielding an overall total 
of $400,975,000. This entire amount was allocated to projects specified 
in the 1998 DOT Appropriations Act. After deducting the .32343056 of 
one percent for oversight ($1,293,722) from the 1998 appropriated 
amount ($400,000,000), $399,681,278 remains available for projects.
    The Conference Report accompanying the 1998 DOT Appropriations Act 
earmarked all of the fiscal year 1998 Bus funds to specified states or 
localities for bus and bus-related projects. Where funds were earmarked 
to states, in most cases, there were additional suballocations to local 
entities. In Louisiana the suballocation is included in the Conference 
Report; however, a letter dated October 14, 1997, from Chairman Frank 
R. Wolf of the House Appropriations Committee clarifies the amount of 
suballocations within the State. This clarification is reflected in the 
Bus allocations displayed in Table 7.
    The conference report directs the FTA to make available to the 
state of Michigan for the procurement of buses and bus-related 
equipment funds ($4,000,000) originally provided in the fiscal year 
1995 Department of Transportation and Related Agencies Appropriations 
Act for a passenger intermodal transit center in Detroit, Michigan.
    The Conferees also direct the FTA to reallocate funds in the amount 
of $4,962,500, made available in Public Law 103-331 for the Twin Cities 
Central Corridor project and not obligated by the end of fiscal year 
1997, and make these funds available for similar bus and bus facilities 
projects in the Twin Cities Central Corridor.
    Also shown in Table 7 is a state and area allocation of the fiscal 
year 1998 funds which are currently available. The total of 
$226,563,012 includes $226,320,000 in fiscal year 1998 trust funded 
contract authority, $975,000 in reprogrammed funds, minus $731,988 for 
PMO.
    All bus projects must be eligible for FTA funding under FTA 
Circular 9300.1 in order to be approved by FTA. In previous years, 
there have been funds allocated for projects which were subsequently 
found to be ineligible for FTA assistance. Applicants with projects 
listed in Table 7 are advised to consult early in the fiscal year with 
the appropriate regional office regarding the project to ensure its 
eligibility for funding. This early consultation is especially critical 
when exercising pre-award authority.
    Because the .32343056 of one percent for PMO was subtracted from 
the amount appropriated, each bus project identified in the Conference 
Report receives .32343056 of one percent less than the funding level 
contained in the report. No funds remain available for discretionary 
allocation by the Federal Transit Administrator. Table 7 displays the 
allocations of the fiscal year 1998 Bus funds by state and area.
    Prior year unobligated appropriations for Bus in the amount of 
$188,761,911 remain available for obligation in fiscal year 1998, and 
are displayed in Table 7A.

X. Unit Values of Data for the Section 5307 Urbanized Area Formula 
Program, Section 5311 Nonurbanized Area Formula Program, and Section 
5309 Capital Fixed Guideway Modernization

    For technical assistance purposes, the dollar unit values of data 
derived from the computations of the Urbanized Area Formula Program, 
the Nonurbanized Area Formula Program, and the Capital Fixed Guideway 
Modernization apportionments are included in this Notice in Table 9. To 
determine how a particular apportionment amount was developed, areas 
may multiply their population, population density, and data from the 
NTD by these unit values.

XI. Section 5303 Metropolitan Planning Program and 5313(b) State 
Planning and Research Program

A. Metropolitan Planning Program

    The fiscal year 1998 Metropolitan Planning apportionment to states 
for MPOs to be used in urbanized areas totals $39,625,587. This amount 
includes $39,500,000 in fiscal year 1998 appropriated funds, and 
$125,587 in prior year deobligated funds which have become available 
for reallocation for this program. A basic allocation of 80 percent of 
this amount ($31,700,470) is distributed to the states based on a 
statutory formula for subsequent state distribution to each urbanized 
area, or parts thereof, within each state. A supplemental allocation of 
the remaining 20 percent ($7,925,117) is also provided to the States 
based on an FTA administrative formula to address planning needs in the 
larger, more complex urbanized areas. Table 8 contains the final state 
apportionments for the combined basic and supplemental allocations. 
Each state, in cooperation with the MPOs, must develop an allocation 
formula for the combined apportionment which distributes these funds to 
MPOs representing urbanized areas, or parts thereof, within the state. 
This formula, which must be approved by the FTA, must ensure to the 
maximum extent practicable, that no MPO is allocated less than the 
amount it received by administrative formula under the Metropolitan 
Planning Program in fiscal year 1991 (minimum MPO allocation). Each 
state formula must include a provision for the minimum MPO allocation. 
Where the state and MPOs

[[Page 64463]]

desire to use a new formula not previously approved by FTA, the state 
or MPO must submit the new formula to the appropriate FTA Regional 
Office for prior approval.
    The Metropolitan Planning Program is totally general funded in 
fiscal year 1998; therefore, the entire appropriated amount of 
$39,500,000 is currently available plus $125,587 in reapportioned 
funds.

B. State Planning and Research Program

    The fiscal year 1998 apportionment for the State Planning and 
Research Program totals $8,472,086. This amount includes $8,250,000 in 
fiscal year 1998 appropriated funds, and $222,086 in prior year 
deobligated funds which have become available for reallocation to this 
program. Final state apportionments, based on a statutory formula for 
this program, are also contained on Table 8. These funds may be used 
for a variety of purposes such as planning, technical studies and 
assistance, demonstrations, management training and cooperative 
research. In addition, a state may authorize a portion of these funds 
to be used to supplement planning funds allocated by the State to its 
urbanized areas as the state deems appropriate.
    The State Planning and Research Program is totally general funded 
in fiscal year 1998; therefore, the entire appropriated amount of 
$8,250,000 is currently available plus $222,086 in reapportioned funds.

C. Data Used for Metropolitan Planning and State Planning and Research 
Apportionments

    Population data from the 1990 Census is used in calculating these 
apportionments. The Metropolitan Planning funding provided to urbanized 
areas in each state by administrative formula in fiscal year 1991 was 
used as a ``hold harmless'' base in calculating funding to each State.

D. FHWA Metropolitan Planning Program and State Planning and Research 
Program

    Last year, estimated apportionments for the corresponding FHWA 
planning programs were provided along with the FTA apportionments. This 
year, no information will be available for the FHWA apportionments 
since their programs have not been reauthorized.

E. Local Match Waiver for Job Access Planning Activities

    Federal, state, and local welfare reform initiatives may require 
the development of new and innovative public and other transportation 
services to ensure that former welfare recipients have adequate 
mobility for reaching employment opportunities. In recognition of the 
key role that transportation plays in ensuring the success of welfare-
to-work initiatives, FTA and FHWA are permitting the waiver of the 
local match requirement for job access planning activities undertaken 
with Metropolitan Planning Program and State Planning and Research 
Program funds. FTA and FHWA will support requests for waivers when they 
are included in metropolitan Unified Planning Programs and State 
Planning and Research Programs and meet all other appropriate 
requirements.

F. Planning Emphasis Areas

    This notice includes newly developed transportation Planning 
Emphasis Areas (PEAs). The PEAs were prepared to advise state and local 
officials and transit operators of the national issues that warrant 
consideration in carrying out the metropolitan and statewide 
transportation planning process. The four major PEA themes were 
developed to promote general consistency between the planning 
initiatives being advanced in the metropolitan and statewide planning 
processes and national policy goals likely to be included in the 
reauthorized transportation legislation, as well as consistency with 
the USDOT Strategic Plan currently being finalized. Consideration of 
the PEAs in each state and metropolitan area, as appropriate in the 
Unified Planning Work Programs and State Planning Work Programs, is 
expected to reflect their unique challenges and goals. The Office of 
Planning anticipates working with a broad cross-section of stakeholders 
in preparing clarifying language and possible ways to relate the PEAs 
to the statewide and metropolitan planning processes.
    Goals developed as part of USDOT's strategic planning process are 
designed to ensure the highest quality of surface transportation which 
promotes the Nation's economic and community vitality and environmental 
quality. Towards these goals, transportation Planning Emphasis Areas 
are prepared to advise state and local officials of the national issues 
that warrant consideration in carrying out the metropolitan and 
statewide transportation planning process (the planning process). 
Consideration of the emphasis areas in each state and metropolitan area 
is expected to reflect their unique challenges and goals. MPOs, states 
and transit operators may want to explore opportunities for local 
governments, the private sector, academic and research centers, 
environmental and human service agencies and other stakeholders to 
participate in the transportation planning process.
1. System Management and Operation
    Planning for effective and efficient transportation system 
management and operation with ongoing performance monitoring preserves 
capacity, maximizes personal mobility and freight movement, ensures 
user safety and system security, and improves and maintains structural 
integrity. Innovative technologies, such as those included in 
Intelligent Transportation Systems (ITS), can improve communications, 
operational efficiencies, safety and system performance. Effectively 
managed transportation systems support the national Welfare-to-Work 
initiative by providing access to employment opportunities and support 
economic development by reducing the time for moving people and 
freight. The development of non-traditional transportation services to 
meet emerging new markets would help improve accessibility and 
mobility.
2. Financial Planning
    A cooperative planning process which considers innovative funding 
sources, such as State Infrastructure Banks (SIBs), assists with 
developing sound transportation financial planning processes with 
accurate estimates of reasonably available funds, costs for system 
expansion, and future operation and maintenance costs. Coordinated 
activities to develop transportation plans will be improved with 
rigorous analysis of the financial dimensions of proposed major 
infrastructure investments.
3. Environmental and Community Impact
    Local planning processes are encouraged to give early consideration 
of the natural environment and communities affected by transportation 
planning and project activities. Air quality issues are a key concern 
in some metropolitan areas. Coordinated planning for transportation and 
land use management will help to create sustainable communities with 
protection of natural resources, concentration of new development in 
suitable areas, and control of sprawl with infill development of under-
utilized areas. State and local officials may choose to evaluate their 
decisionmaking process to determine how well it responds to community 
needs, as called for in the Livable Communities initiative. 
Consideration may be given to joint development of

[[Page 64464]]

transportation infrastructure projects along with facilities providing 
goods and services to communities and neighborhoods.
4. Transportation and Equity
    Transportation planning processes should address the equitable 
distribution of mobility benefits and possible adverse environmental 
and health impacts created by federally funded transportation 
investments and activities. The benefits of Federal transportation 
investments should be equitably distributed as required by Title VI. 
Planning processes should evaluate proposed transportation investments 
to ensure they do not disproportionately create adverse human health 
and environmental impacts on low-income and minority populations.

G. Federal Planning Certification Reviews

    Federal certification of the planning process is conducted in a 
Transportation Management Area (TMA), which is an urbanized area over 
200,000 in population or other urbanized area designated by the 
Secretary of Transportation (the Secretary). The Secretary is 
responsible for certifying, at least once every three years, that the 
metropolitan transportation planning process in the TMA is being 
carried out under applicable provisions of Federal law. More detail on 
these reviews can be found in the September 8, 1997, Federal Register 
notice, which announced the metropolitan planning processes that will 
jointly be reviewed by FTA and FHWA and requested comments on the 
metropolitan planning processes under review.
    Dates for site visits for the TMAs to be reviewed in fiscal year 
1998 are being established and are available on the FTA Home Page at 
http://www.fta.gov/office/planning.
    For further information regarding Federal certifications of the 
planning process contact: For FTA: Mr. Charles Goodman, FTA 
Metropolitan Planning Division (TPL-12), 202-366-1944; or Scott Biehl, 
FTA Office of Chief Counsel (TCC-30), 202-366-4063. For FHWA: Mr. 
Sheldon Edner, FHWA Metropolitan Planning Division (HEP-20), 202-366-
4066; or Reid Alsop, FHWA Office of the Chief Counsel (HCC-31), 202-
366-1371.

H. Consolidated Planning Grant

    In fiscal year 1997, FTA and FHWA began offering states the option 
of participating in a pilot Consolidated Planning Grant (CPG) program. 
Thirteen states have agreed to participate in the pilot. In fiscal year 
1997, more than $33.9 million was obligated for 11 CPG pilot states. 
The total obligations are approximately two-thirds FHWA planning funds 
and one-third FTA planning funds. One of our original goals in 
developing the CPG pilot was to give states and MPOs more control over 
their planning resources with a combination of broader financial 
controls and greater flexibility in the management of their planning 
activities. As part of the pilot, grants can be made with a ``blended'' 
ratio, if appropriate, to address different FTA and FHWA Federal 
matches. The blended ratio would allow billing at a single ratio 
determined on the relative shares of FTA and FHWA planning funds.
    To further reduce paperwork for our customers, the CPG pilot offers 
the states two options for carrying the CPGs over from year to year. 
The first option is to treat the CPG much as FHWA grants are treated 
currently; that is, as basically annual grants with a yearly close-out, 
deobligation and reobligation cycle. The second option is to treat the 
CPG more like an FTA grant, but with even greater flexibility. Under 
this second option, the CPG grant would stay open for a multi-year 
period to be determined by the state (and MPO, jointly, for 
Metropolitan Planning funds) with the approval of the Federal 
Government. New apportionments will be added by a grant amendment as 
the funds become available. So far, over one-half of the current CPG 
grantees plan to follow this second option.
    The FTA is exploring with FHWA the potential for extending FTA's 
pre-award authority to the entire CPG program. This would allow states 
to continue their planning program activities from year to year with 
the assurance (granted to all FTA grantees in the annual Federal 
Register notice) that eligible costs can later be converted to a 
regularly funded Federal project without the need for prior approval or 
authorization from the granting agency.
    FTA will also be providing an enhancement to its Electronic Grant 
Making and Management (EGMM) program that is now used to request 
planning grants, obligate funds, monitor fund balances and grant 
status, and file financial and status reports for the CPG. These 
enhancements will benefit all grants including the CPG. For further 
information on participating in the CPG Pilot, contact Ms. Candace 
Noonan, Intermodal and Statewide Planning Division (TPL-11) at (202) 
366-1648.

XII. Period of Availability of Funds

    The funds apportioned under the Urbanized Area Formula Program, the 
Fixed Guideway Modernization Program, the Metropolitan Planning Program 
and the State Planning and Research Program in this notice will remain 
available to be obligated by FTA to recipients for three fiscal years 
following fiscal year 1998. Any of these apportioned funds unobligated 
at the close of business on September 30, 2001, will revert to FTA for 
reapportionment under these respective programs.
    Funds apportioned to nonurbanized areas under the Nonurbanized Area 
Formula Program, including RTAP funds, will remain available for two 
fiscal years following fiscal year 1998. Any such funds remaining 
unobligated at the close of business on September 30, 2000, will revert 
to FTA for reapportionment among the states under the Nonurbanized Area 
Formula Program. Funds allocated to States under the Elderly and 
Persons with Disabilities Program in this Notice must be obligated by 
September 30, 1998. Any such funds remaining unobligated as of this 
date will revert to FTA for reapportionment among the states under the 
Elderly and Persons with Disabilities Program. The 1998 DOT 
Appropriations Act includes a provision requiring that fiscal year 1998 
New Starts and Bus funds not obligated for their original purpose as of 
September 30, 2000, shall be made available for other discretionary 
projects within the respective categories of the Capital Program. 
Similar provisions in the 1997 and 1996 DOT Appropriations Acts 
required that fiscal year 1997 Bus and New Starts funds that are not 
obligated by September 30, 1999, shall also be made available for other 
discretionary Bus or New Start projects, respectively, and fiscal year 
1996 Bus and New Starts funds unobligated by September 30, 1998, shall 
be made available for other discretionary Bus or New Start projects, 
respectively.

XIII. Notice of Pre-Award Authority to Incur Project Cost

A. Background

    Since fiscal year 1994, FTA has provided grantees pre-award 
authority to cover planning and capital costs prior to grant award. 
Previous to this grantees had authority to incur costs for operating 
assistance prior to grant award. This automatic pre-award spending 
authority permitted a grantee to incur costs on an eligible transit 
capital or planning project without prejudice to possible future 
Federal

[[Page 64465]]

participation in the cost of the project or projects. In order to 
ensure eligibility for future FTA funds, grantees are encouraged to 
consult with the appropriate regional office prior to exercising pre-
award authority.

B. Current Coverage

    In fiscal year 1998, authority to incur costs for Fixed Guideway 
Modernization Formula, Metropolitan Planning, Urbanized Area Formula, 
Elderly and Persons with Disabilities, Nonurbanized Area Formula, and 
State Planning and Research in advance of possible future Federal 
participation is provided to fiscal year 1998 funds apportioned and 
allocated in this notice. This pre-award authority also applies to 
Capital Bus funds identified in this notice. Pre-award authority for 
carryover amounts for these programs was provided in the FTA Fiscal 
Year 1997 Apportionments and Allocations Federal Register notice. This 
pre-award authority is also extended to projects intended to be funded 
with STP or CMAQ funds transferred to FTA in fiscal year 1998. Pre-
award authority applies to FTA funds and flexible funds provided the 
conditions in C and D below are met. The pre-award authority does not 
apply to Capital New Start funds. Preaward authority also applies to 
preventive maintenance costs incurred within a local fiscal year ending 
during calendar year 1997, or thereafter, under the formula programs 
cited above.

C. Conditions

    Similar to the FTA Letter of No Prejudice (LONP) authority, the 
conditions under which this authority may be utilized are specified 
below:
    (1) This pre-award authority is not a legal or moral commitment 
that the project(s) will be approved for FTA assistance or that the FTA 
will obligate Federal funds. Furthermore, it is not a legal or moral 
commitment that all items undertaken by the applicant will be eligible 
for inclusion in the project(s).
    (2) All FTA statutory, procedural, and contractual requirements 
must be met.
    (3) No action will be taken by the grantee which prejudices the 
legal and administrative findings which the Federal Transit 
Administrator must make in order to approve a project.
    (4) Local funds expended by the grantee pursuant to and after the 
date of this authority will be eligible for credit toward local match 
or reimbursement if the FTA later makes a grant for the project(s) or 
project amendment(s).
    (5) The Federal amount of any future FTA assistance to the grantee 
for the project will be determined on the basis of the overall scope of 
activities and the prevailing statutory provisions with respect to the 
Federal-local match ratio at the time the funds are obligated.
    (6) For funds to which this authority applies, the authority 
expires with the lapsing of fiscal year 1998 funds.

D. Environmental, Planning and Other Federal Requirements

    FTA emphasizes that all of the Federal grant requirements must be 
met for the project to remain eligible for Federal funding. Some of 
these requirements must be met before pre-award costs are incurred, 
notably the requirements of the National Environmental Policy Act 
(NEPA), and the planning requirements. Compliance with NEPA and other 
environmental laws or executive orders (e.g., protection of parklands, 
wetlands, historic properties) must be completed before state or local 
funds are advanced for a project expected to be subsequently funded 
with FTA funds. Depending on which class the project is included under 
in FTA's environmental regulations (23 CFR part 771) the grantee may 
not advance the project beyond planning and preliminary engineering 
before FTA has approved either a categorical exclusion (refer to 23 CFR 
part 771.117(d)), a finding of no significant impact, or a final 
environmental impact statement. The conformity requirements of the 
Clean Air Act (40 CFR part 51) also must be fully met before the 
project may be advanced with non-Federal funds.
    Similarly, the requirement that a project be included in a locally 
adopted metropolitan transportation improvement program and federally 
approved statewide transportation improvement program must be followed 
before the project may be advanced with non federal funds. In addition, 
Federal procurement procedures, as well as the whole range of Federal 
requirements, must be followed for projects in which Federal funding 
will be sought in the future. Failure to follow any such requirements 
could make the project ineligible for Federal funding. In short, this 
increased administrative flexibility requires a grantee to make certain 
that no Federal requirements are circumvented thereby. If a grantee has 
questions or concerns regarding the environmental requirements, or any 
other Federal requirements that must be met before incurring costs, it 
should contact the appropriate regional office.
    Before an applicant may incur costs either for activities expected 
to be funded by New Start funds, or for activities requiring funding 
beyond fiscal year 1998, it must first obtain a written LONP from the 
FTA. To obtain an LONP, a grantee must submit a written request 
accompanied by adequate information and justification to the 
appropriate FTA regional office.

XIV. Rail Fixed Guideway Systems: State Safety Oversight (49 CFR Part 
659)

    There are 19 states and the District of Columbia in which rail 
fixed guideway transit systems operate. These states and the District 
of Columbia must comply with 49 U.S.C. Section 5330, by designating an 
agency to oversee the safety and security for those rail fixed guideway 
systems, which are not regulated by the Federal Railroad 
Administration. On December 27, 1995, FTA issued a final regulation 
implementing the State Safety Oversight provisions of Section 5330. 
Compliance with safety provisions of the rule was required by January 
1, 1997. Compliance with the security provisions of the final rule is 
required by January 1, 1998. Codified at 49 CFR part 659, the State 
Safety Oversight regulation delineates responsibilities of the state, 
the oversight agency, the transit agency, and the FTA.
    A State Oversight Agency must establish a ``System Safety and 
Security Program Standard,'' review and approve a transit agency's 
System Safety and Security Program Plan, conduct investigations of 
accidents and unacceptable hazards, conduct on-sight safety reviews, 
and report annually to FTA. Rail transit systems must develop and 
implement a System Safety and Security Program Plan, classify and 
report accidents and unacceptable hazards, develop corrective action 
plans, and conduct on-going safety audits. On-site safety reviews by 
the State Oversight Agency and audits by the transit agency must 
measure the effectiveness of the Plan and identify how and where to 
improve the system safety and security process.
    The Administrator of the FTA may withhold up to five percent of the 
amount required to be apportioned for use in any state or affected 
urbanized area in such state under FTA's formula program for urbanized 
areas for any fiscal year beginning after September 30, 1997, if the 
state in the previous fiscal year has not met the requirements of this 
part and the Administrator determines that the state is not making 
adequate efforts to comply with this part. States which are not in 
compliance have been notified of their status. Affected grantees will 
be notified of any fiscal year 1998 funds to be withheld for non-
compliance.

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XV. Electronic Grant Making and Management Initiatives

A. Background

    In 1994 FTA began the Electronic Grant Making and Management (EGMM) 
initiative. The EGMM program is a paperless electronic grant 
application, review, approval, acceptance and management process. This 
program started as a pilot effort and involved 10 grantees nationwide 
to serve as pilots. By fiscal year 1997 120 grantees were participating 
in the FTA EGMM program for the grant application process. Over 558 
grantees were on line for various management activities such as filing 
of financial status reports and narrative status reports. In addition, 
grantees may use EGMM for the electronic signature of annual 
certifications and assurances.

B. Graphical User Interface

    The latest enhancement to the EGMM program is the Graphical User 
Interface program, otherwise known as GUI. GUI is a windows based 
program and therefore is more user friendly than the original EGMM 
system. With GUI, the user can rely on a limited number of windows, 
each with a user friendly menu bar. As this windows based environment 
is not directly interfacing with the FTA mainframe computer, problems 
of slowness of the connection are eliminated. In addition, GUI will 
provide greater compatibility with other systems, allowing more data 
migration by providing opportunities to simplify the information entry 
process. GUI is now being tested with a limited number of grantees. 
Following this testing, it will be made available to all EGMM grantees. 
Please contact the FTA Regional office to learn about this new 
enhancement to EGMM and the hardware and software requirements.

C. Fiscal Year 1998 Emphasis

    In fiscal year 1998 FTA continues to strongly encourage grantees to 
become EGMM grantees for grant application and approval as well as for 
grant management activities if they have not already done so. We also 
encourage all grantees to file the fiscal year 1998 Certifications and 
Assurances electronically using the EGMM system. A major goal is the 
completion of the pilot phase of GUI and the conversion of our EGMM 
grantees to the new enhanced EGMM system.

XVI. 1998 Annual List of Certifications and Assurances

    The Fiscal Year 1998 Annual List of Certifications and Assurances 
for Federal Transit Administration Grants and Cooperative Agreements 
notice was published in the Federal Register on October 14, 1997. It 
appears as Part IV on pages 53512 through 53522. This October 14 
document contains two major changes to the previous year's Federal 
Register publication. (1) Starting with fiscal year 1998, all 
applicants for FTA Capital Program or Formula Program assistance, and 
current grantees with an active project financed with FTA Capital 
Program or Formula Program assistance will be required to provide the 
Appendix A Certifications and Assurances within 90 days from the date 
of the October 14 publication or with its first grant application in 
fiscal year 1998, whichever comes first. (2) The attorney signature 
from previous years on the single signature page will no longer be 
acceptable. FTA requires a current attorney's affirmation of the 
applicant's legal authority to certify compliance with fiscal year 1998 
FTA funding assistance. This does not affect the electronic opportunity 
for a grant applicant's authorized representative to electronically 
enter a PIN in the On-Line Program, offered to applicants through the 
Grant Management Information System (GMIS), indicating that a current 
valid 1998 attorney's signature is on file. The fiscal year 1998 Annual 
List of Certifications and Assurances is accessible on the Internet at 
www.fta.dot.gov/. Any questions regarding this document may be 
addressed to the appropriate Regional Office or to Pat Berkley, Office 
of Program Management, Federal Transit Administration, (202) 366-6470.

XVII. Quarterly Approval of Grants

    The FTA has established a quarterly approval and release cycle for 
processing grants. All Urbanized Area Formula, Nonurbanized Area 
Formula, Elderly and Persons with Disabilities, Capital, Metropolitan 
Planning, and State Planning and Research grants are processed on a 
quarterly basis. This includes grants using STP or CMAQ funds.
    If completed applications are submitted to the appropriate FTA 
Regional Office no later than the first business day of the quarter, 
FTA will award grants by the last business day of the quarter.
    In order to expedite the grant approval process within the 
quarterly approval structure, grants which are complete and have 
received the required Transit Employee Protective Certification from 
the Department of Labor (DOL) will be approved before the end of the 
quarter. There are only two factors which would delay FTA approval of 
the project beyond the end of a quarter. First is a failure by DOL to 
issue a Transit Employee Protective Certification where such 
certification is a prerequisite to a grant approval, and second is the 
failure of FHWA to actually transfer flexible funds.
    For an application to be considered complete, all required 
activities such as inclusion of the project in a locally approved 
Transportation Improvement Program (TIP), a Federally approved State 
Transportation Improvement Program (STIP), intergovernmental reviews, 
environmental reviews, all applicable civil rights, anti-drug, clean 
air requirements and submission of all requisite certifications and 
documentation must be completed. The application must be in approvable 
form with all required documentation and submissions on hand, except 
for the labor protection certification which is issued by DOL. 
Incomplete applications will not be processed, but if the missing 
components are supplied, applications will be considered in the next 
quarter.
    It is the policy of FTA to expedite grant application reviews and 
speed program delivery by reducing the number of grant applications. To 
this end, FTA strongly encourages grant applicants to submit only one 
application per fiscal year for each formula program. The single 
application should contain the fiscal year's capital (including 
flexible funds), planning and operating elements.

XVIII. Grant Application Procedures

    All applications for FTA funds should be submitted to the 
appropriate FTA Regional Office. Formula grant applications should be 
prepared in conformance with the following FTA Circulars: Urbanized 
Area Formula Program: Grant Application Instructions--C9040.1B, October 
10, 1996; Nonurbanized Area Formula Program Guidance and Grant 
Application Instructions--C9040.1D, May 8, 1997; Section 5310 Elderly 
and Persons with Disabilities Program Guidance and Application 
Instructions--C9070.1D, October 22, 1997; Section 5309 Capital Program: 
Grant Application Instructions--C9300.1, September 29, 1995; and 
Program Guidance and Application Instructions for Metropolitan Planning 
Program Grants--C8100.1B, October 25, 1996. Applications for STP 
``flexible'' fund grants should be prepared in the same manner as the 
apportioned funds under the Urbanized Area Formula, Nonurbanized Area 
Formula, or Elderly and Persons with Disabilities Programs. Guidance on 
preparation of applications for State Planning and Research funds

[[Page 64467]]

may be obtained from each FTA Regional Office. Copies of circulars are 
available from FTA Regional Offices as well as the FTA Home Page on the 
Internet.

    Issued on: December 2, 1997.
Gordon J. Linton,
Administrator.

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[FR Doc. 97-31910 Filed 12-2-97; 1:48 pm]
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