[Federal Register Volume 65, Number 10 (Friday, January 14, 2000)]
[Rules and Regulations]
[Pages 2342-2348]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-613]


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DEPARTMENT OF TRANSPORTATION

Federal Railroad Administration

49 CFR Part 268

[FRA Docket No. FRA-98-4545; Notice No. 3]
RIN 2130-AB29


Magnetic Levitation Transportation Technology Deployment Program

AGENCY: Federal Railroad Administration (FRA), Department of 
Transportation (DOT).

ACTION: Final rule.

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SUMMARY: FRA published an Interim final rule with request for comments 
on October 13, 1998 (63 FR 54600), implementing the Magnetic Levitation 
Technology Deployment Program. An amendment to the interim final rule 
was published on February 12, 1999 (64 FR 7133) extending the deadline 
for the submission of application packages from December 31, 1998, to 
February 15, 1999, and making other adjustments to various dates which 
flow from that extension of time.
    As amended, the interim final rule establishes dates for the Timing 
of Major Milestones and requires FRA to select one project for final 
design, engineering, and construction funding at the completion of 
Phase III. This rulemaking revises the dates established for the Timing 
of Major Milestones to reflect unanticipated delays in the completion 
of Phase I of the program, changes the description of Phase II to 
eliminate the requirement for each grant recipient to initiate 
activities aimed at preparing a site-specific draft Environmental 
Impact Statement (EIS), expands Phase III to allow down-selecting to 
more than one project for additional study, and shifts FRA's selection 
of one project for final design, engineering, and construction funding 
to Phase IV. It also specifies that certain expenses incurred prior to 
the execution of a cooperative agreement to assist in the financing of 
pre-construction activities, but after enactment of the Transportation 
Equity Act for the 21st Century (TEA 21) (June 9, 1998), are eligible 
for reimbursement of the Federal share of the cost.

EFFECTIVE DATE: This final rule is effective January 14, 2000.

FOR FURTHER INFORMATION CONTACT: Arnold Kupferman, FRA, 1120 Vermont 
Ave., NW, Washington, DC 20590 (telephone 202-493-6365; E-mail address: 
(Arnold.K[email protected]), or Gareth Rosenau, Attorney, Office of 
Chief Counsel, FRA, 1120 Vermont Ave., NW, Mailstop 10, Washington, DC 
20590 (telephone 202-493-6054; E-mail address: 
Gareth.R[email protected]).

SUPPLEMENTARY INFORMATION:

I. Background

A. The Transportation Equity Act for the 21st Century (TEA 21)

    TEA 21 (Pub. L. No. 105-178) adds a new section 322 to title 23 of 
the United States Code. Section 322 provides a total of $55 million for 
Fiscal Years 1999 through 2001 for transportation systems employing 
magnetic levitation (``Maglev''). Section 322 requires FRA to establish 
project selection criteria, to solicit applications for funding, to 
select one or more projects to receive financial assistance for 
preconstruction planning activities, and, after completion of such 
activities, to select one of the projects to receive financial 
assistance for final design, engineering, and construction activities. 
Section 322 authorizes--but does not appropriate--additional Federal 
funds of $950 million for final design and construction of the most 
promising project. Section 322 provides that the portion of the project 
not covered by the funds provided under section 322 may be covered by 
any non-Federal funding sources--including private (debt and/or 
equity), State, local, regional, and other public or public/private 
entities--as well as by Federally-provided Surface Transportation 
Program, and Congestion Mitigation and Air Quality Improvement Program 
funds, and from other forms of financial assistance under TEA 21, such 
as loans and loan guarantees.

B. The Interim Final Rule

    On October 13, 1998, FRA published in the Federal Register an 
interim final rule that established, on an interim basis, the 
regulations governing financial assistance under the Maglev Deployment 
Program, including the project selection criteria. The document 
solicited public comments and applications for Maglev preconstruction 
planning grants. As noted above, the rule was amended once to extend 
the deadline for submission of application packages from interested 
States or their designated authorities. The interim final rule 
provides: a definition of terms used in the Interim Final Rule; a 
description and schedule for the various phases of the Maglev 
Deployment Program; identification of available funding sources for the 
Program; requirements for the Federal and State shares and restrictions 
on the uses of Federal maglev funds; identification of eligible 
participants; project eligibility

[[Page 2343]]

standards; a description of the format, content and timing of 
applications for preconstruction planning assistance and the criteria 
to be used by FRA in evaluating the applications; and a description of 
the criteria to be used in selecting one project for final design, 
engineering and construction.

II. Discussion of Comments and Conclusions

    FRA received only two timely-filed public comments on the interim 
final rule. Set forth below is a summary of the comments received and 
FRA's responses to the concerns expressed in those letters to the 
docket.
    Comment: One commenter expressed concern that the process set forth 
in the interim final rule appears to call for project applicants to 
commit to proceeding with a maglev project in advance of the 
environmental analysis required under National Environmental Policy Act 
(NEPA). The commenter alleges that under NEPA any project must involve 
a study of alternatives, including technology alternatives which may 
have different environmental effects.
    Response: Under the authorizing legislation (Section 1218 of TEA 
21), the authorized funding can only be used to pay the costs of 
preconstruction planning activities, design, engineering and 
construction of ``transportation systems employing magnetic levitation 
that would be capable of safe use by the public at a speed in excess of 
240 miles per hour.'' It is clear that the Congressional intent is to 
consider only maglev technology for the use of these funds.
    Comment: The second commenter expressed concern that under the 
schedule suggested in the interim final rule, not enough time was 
allowed for promulgation of appropriate safety standards and testing 
for safety before full construction authorization is given.
    Response: Under the changes in the schedule effected by this 
rulemaking, the selection of one project for final design, engineering 
and construction is delayed until March 2001, at the earliest. In no 
event will construction be authorized until FRA is fully satisfied that 
the system will meet appropriate safety standards.

III. Summary of Revisions to the Interim Final Rule and Rationale 
for Such Changes

Changes in Dates

    Section 268.3 (b) of the interim final rule, as amended, 
established April 30, 1999 as the date for the completion of Phase I--
Competition for Planning Grants. However, the selection of seven of the 
applicants for participation in the program was not announced by the 
Secretary of Transportation until May 24, 1999. Additional time has 
been required to negotiate suitable cooperative agreements with each of 
the selected participants. As a consequence, it is necessary to revise 
many of the dates specified in the interim final rule to reflect a 
realistic schedule.

Eligibility of Pre-agreement Activities

    In order to continue on-going work on several projects that had 
been initiated prior to the execution of cooperative agreements under 
the Maglev Deployment Program and in response to several requests, FRA 
has decided to make eligible for funding certain expenses incurred 
subsequent to June 9, 1998 ( the date of enactment of TEA 21), provided 
that they contributed to development of the Project Description 
described in Phase II. This rulemaking adds this provision to 
Sec. 268.5 of the rule.

Exclusion of Requirement for Funding for Site-specific EIS in Phase II 
of the Project

    The interim final rule required that, ``After completion of the EA 
[Environmental Assessment], each financial assistance recipient will 
initiate activities aimed at preparing a site-specific draft 
environmental impact statement.'' It was intended that these activities 
would be included in the scope of work to be funded by the 
preconstruction planning grant. Because of the constraints on the 
available funding, there may not be sufficient funds to pay the Federal 
share of the costs of activities aimed at the preparation of site-
specific draft EIS's for each of the seven projects selected for pre-
construction planning, as specified in Sec. 268.3 (c). Therefore, this 
rulemaking eliminates that requirement from the description of Phase 
II--Project Description Development.

Down-selection of One or More Projects in Phase III of the Program

    The interim final rule, as amended, requires FRA to evaluate the 
information provided by the seven selected participants during Phase II 
of the Program and select a single project for final design, 
engineering, and construction funding as Phase III of the Program. FRA 
anticipates that after a year of study more than one of the projects 
being planned may meet all of the eligibility requirements of the law, 
and, without additional information from additional environmental 
studies, financial analysis, and detailed design, it will not be 
possible to make a well-informed choice of the best project. This 
rulemaking changes the description of Phase III--Project Selection 
Process to permit the FRA to delay the selection of a single project 
for final design, engineering, and construction funding, and to down-
select more than one eligible project for further study. Additional 
environmental studies, financial analysis, and detailed design would be 
funded for each of the down-selected projects.

Selection of One Project

    This rulemaking also changes Phase IV--Project Development and 
Completion of Site-Specific EIS to require FRA to select one project, 
if more than one project is down-selected by FRA in Phase III.
    These proposed changes have been discussed with the seven 
participating agencies that would be affected by the proposed change, 
and there is agreement that such changes are desirable.

Regulatory Analyses and Notices

    This rulemaking modifies the interim final rule by:
    (1) Eliminating the requirement in Sec. 268.3 (c) for each grant 
recipient to initiate activities aimed at the preparation of a site-
specific EIS after completion of an Environmental Assessment (EA);
    (2) Modifying Sec. 268.3 (d) to allow the FRA to down-select one or 
more projects and to finance the preparation of environmental and other 
additional studies for the down-selected projects before selecting one 
project for final design, engineering, and construction funding;
    (3) Changing Sec. 268.3 (e) to require FRA to select one project 
for final design, engineering, and construction funding, if more than 
one project is down-selected by FRA in Phase III;
    (4) Amending the dates specified in Sec. 268.3 to reflect a 
realistic schedule;
    (5) Adding paragraph (c) to Sec. 268.5 to make some costs incurred 
after June 9, 1998 eligible for reimbursement; and
    (6) Amending Sec. 268.21 to conform to the above changes.
    There are no other changes to the interim final rule.

Regulatory Analyses and Notices

E.O. 12866 and DOT Regulatory Policies and Procedures

    The agency has evaluated this Final Rule in accordance with 
existing regulatory policies and procedures and has concluded that it 
is a nonsignificant regulatory action under E.O. 12866, and

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a nonsignificant rule under section 5(a)(4) of the DOT Regulatory 
Policies and Procedures (44 FR 11034, February 26, 1979). The Final 
Rule is not a significant regulatory action under E.O. 12866 because it 
will not have an annual effect on the economy of $100 million or more 
or adversely affect in a material way the economy, a sector of the 
economy, productivity, competition, jobs, the environment, public 
health or safety, or State, local, or tribal governments or 
communities; will not create a serious inconsistency with an action 
planned or underway by another Federal agency; will not materially 
alter the budgetary impact of entitlements, grants, user fees, or loan 
programs or the rights and obligations of recipients thereof; and will 
not raise novel legal or policy issues arising out of legal mandates, 
the President's priorities, or the principles of the Executive Order. 
The Final Rule implements the preconstruction planning portion of a 
Congressionally mandated program to provide financial assistance to 
state and local governments in developing and implementing a 
transportation project involving magnetic levitation. At this time, the 
sum of $55 million dollars is available to implement the program and an 
authorization for future appropriations totaling $950 million is in 
place. However, as noted earlier, the availability of these additional 
funds is contingent on an appropriation by the Congress.

Regulatory Flexibility Act

    The Regulatory Flexibility Act of 1980 (5 U.S.C. 601 et seq.) 
requires a review of rules to assess their impact on small entities. 
FRA certifies that this rule will not have a significant impact on a 
substantial number of small entities. Eligible applicants for the 
Maglev Deployment Program are limited by the enabling statute (23 
U.S.C. 322(d)) to States or authorities designated by one or more 
States. The program implemented by the final rule has the potential to 
benefit some small entities who may be able to participate as 
consultants to States or designated authorities in the preconstruction 
planning activities, final design, engineering and construction 
activities for Maglev deployment.

Paperwork Reduction Act

    The Paperwork Reduction Act (44 U.S.C. 3501 et seq.) addresses the 
collection of information by the Federal government from individuals, 
small businesses and State and local government and seeks to minimize 
the burdens such information collection requirements might impose. A 
collection of information includes requiring answers to identical 
questions posed to, or identical reporting or record-keeping 
requirements imposed on, ten or more persons, other than agencies, 
instrumentalities or employees of the United States. This final rule 
contains information and reporting requirements that would apply to 
States, groups of States or designated authorities that file 
applications for Federal funding for preconstruction planning 
activities, and to grant recipients who would conduct final design, 
engineering and construction activities in support of Maglev 
deployment. As anticipated in the interim final rule, the statutory 
limit on the types of entities that may apply for funding (States, 
groups of States, and State designated authorities), the rigorous 
requirements for developing a viable project, and the substantial 
financial and resource commitment that were required of applicants, the 
FRA received fewer than 10 completed applications for preconstruction 
planning funds from qualified applicants.

Environmental Impact

    FRA has evaluated these regulations in accordance with its 
procedures for ensuring full consideration of the potential 
environmental impacts of FRA actions, as required by the National 
Environmental Policy Act (42 U.S.C. 4321 et seq.) and related 
directives. FRA has concluded that the issuance of this final rule, 
which establishes a process for receiving applications for planning 
activities associated with the Maglev Deployment Program, does not have 
a potential impact on the environment and does not constitute a major 
Federal action requiring an environmental assessment or environmental 
impact statement. The final rule includes requirements for the 
preparation of environmental assessments of proposed Maglev projects by 
successful applicants during the preconstruction planning stage and 
additional environmental reviews will be undertaken under the auspices 
of the FRA before one Maglev project is selected for final design and 
construction funding.

Federalism Implications

    This final rule has been analyzed in accordance with the principles 
and criteria contained in Executive Order 12612, and FRA has determined 
that it does not have sufficient federalism implications to warrant the 
preparation of a Federalism Assessment. The Maglev Deployment Program 
provides states with the opportunity to explore the development of a 
new transportation technology in a working partnership with the Federal 
Government.

List of Subjects in 49 CFR Part 268

    Grant programs-transportation, High speed ground transportation, 
Maglev, Magnetic levitation.

IV. Provisions of The Final Rule

    In consideration of the foregoing, FRA revises part 268 title 49 of 
the Code of Federal Regulations to read as set forth below:

PART 268--MAGNETIC LEVITATION TRANSPORTATION TECHNOLOGY DEPLOYMENT 
PROGRAM

Subpart A--Overview

268.1  Definitions.
268.3  Different phases of the Maglev Deployment Program.
268.5  Federal funding sources for the Maglev Deployment Program.
268.7  Federal/State share and restrictions on the uses of Federal 
Maglev Funds.

Subpart B--Procedures For Financial Assistance

268.9  Eligible participants.
268.11  Project eligibility standards.
268.13  Deadline for submission of applications for preconstruction 
planning assistance.
268.15  Form and contents of applications for preconstruction 
planning assistance.
268.17  Project selection criteria.
268.19  Evaluation of applications for preconstruction planning 
assistance.
268.21  Down-selection of one or more Maglev projects for further 
study and selection of one project for final design, engineering, 
and construction funding.

    Authority: 49 U.S.C. 322; 23 U.S.C. 322; 49 CFR 1.49.

Subpart A--Overview


Sec. 268.1  Definitions.

    As used in this part--
    CMAQ means Congestion Mitigation and Air Quality Improvement 
Program (23 U.S.C. 149).
    Environmental assessment (``EA'') means the environmental 
assessment in support of the project description and containing the 
information listed in Sec. 268.11(b)(6)(i).
    Environmental impact statement (``EIS'') means the environmental 
impact statement which is required pursuant to Secs. 268.3.
    Eligible project costs means the costs of preconstruction planning 
activities and the capital cost of the fixed guideway infrastructure of 
a Maglev project, including land, piers, guideways, propulsion 
equipment and other components attached to guideways, power 
distribution facilities (including substations), control and 
communications facilities, access roads,

[[Page 2345]]

and storage, repair, and maintenance facilities, but eligible project 
costs do not include the cost of stations, vehicles, and equipment.
    Federal Maglev funds means such funds as are provided under the 
authority of 23 U.S.C. 322 to pay for Eligible Project Costs.
    Full project costs means the total capital costs of a Maglev 
project, including Eligible Project Costs and the costs of stations, 
vehicles, and equipment.
    Phase means one of the five different phases of the Maglev 
Deployment Program; these phases are described in Sec. 268.3.
    Maglev means transportation systems employing magnetic levitation 
that would be capable of safe use by the public at a speed in excess of 
240 miles per hour.
    Maglev Deployment Program means the program authorized by 23 U.S.C. 
322.
    Partnership potential means the usage of the term in the commercial 
feasibility study of high-speed ground transportation (High Speed 
Ground Transportation for America) mandated under section 1036 of the 
Intermodal Surface Transportation Efficiency Act of 1991 (105 Stat. 
1978). Under that usage any corridor exhibiting Partnership Potential 
must at least meet the following two conditions:
    (1) Private enterprise must be able to run on the corridor--once 
built and paid for--as a completely self-sustaining entity; and
    (2) The total benefits of a Maglev corridor must equal or exceed 
its total costs.
    STP means the Surface Transportation Program (23 U.S.C. 133).
    TEA 21 means the Transportation Equity Act for the 21st Century 
(Public Law No. 105-178, 112 Stat. 107).


Sec. 268.3  Different phases of the Maglev Deployment Program.

    (a) The Maglev Deployment Program includes five phases, as 
described in paragraphs (b) through (f) of this section. The current 
projected timing for implementing these phases is indicated to assist 
applicants in planning their projects. All dates beyond the first date 
(the deadline for the submission of preconstruction planning 
applications) are for planning purposes only and are subject to 
change--including possible acceleration of deadlines--based on the 
progress of the Maglev Deployment Program; grantees will be notified 
accordingly.
    (b) Phase I--Competition for Planning Grants (Early October 1998--
September 15, 1999).
    (1) Description. In Phase I, States will apply for funds for 
preconstruction planning activities. As required by Sec. 268.13, 
applications must be filed with FRA by February 15, 1999. FRA will 
select one or more projects to receive preconstruction planning 
financial assistance awarded under this part to perform Phase II of the 
Maglev Deployment Program.
    (2) Timing of Major Milestones.
    (i) February 15, 1999--Planning grant applications due.
    (ii) May 24, 1999--FRA announces grantees for planning grants.
    (iii) August 31, 1999--FRA awards planning grants for the conduct 
of activities listed in Phase II.
    (c) Phase II--Project Description Development (July 1, 1999--June 
30, 2000). 
    (1) Description. In Phase II, each grant recipient will prepare and 
submit to FRA a project description, supporting preconstruction 
planning reports, and an EA. Supporting reports may include demand and 
revenue analyses, project specification, cost estimates, scheduling, 
financial studies, a system safety plan (including supporting 
analysis), and other information in support of the project description. 
FRA will use this information in reaching a decision on which projects 
to down-select for completion of site-specific environmental studies, 
investment grade revenue forecasts, and other studies and analyses 
necessary prior to initiation of construction. FRA will initiate 
documentation of environmental factors considered in the project 
selection process.
    (2) Timing of Major Milestones.
    (i) February 29, 2000--Deadline for submission of appropriate EA's 
needed by FRA for the down-selection of one or more projects under 
Phase III.
    (ii) June 30, 2000--Deadline for submission of project descriptions 
and any related supporting reports needed by FRA for down-selection of 
one or more projects.
    (d) Phase III--Project Selection Process (July 1, 2000--September 
30, 2000). 
    (1) Description. FRA will evaluate the information provided by the 
grant recipients under Phase II and will down-select one or more 
projects for completion of additional environmental studies, investment 
grade revenue forecasts, and other studies and analyses necessary prior 
to initiation of construction.
    (2) Timing of Major Milestones. September 30, 2000--FRA down-
selects one or more project(s).
    (e) Phase IV--Project Development and Completion of Site-specific 
EIS October 1, 2000--November 30, 2001).
    (1) Description. The financial assistance recipient(s) down-
selected in Phase III will complete additional environmental studies, 
investment grade revenue forecasts, and other studies and analyses 
necessary prior to initiation of construction, and address issues 
raised by FRA's review of system safety plans (including supporting 
analysis). They will also initiate final design and engineering work 
for the down-selected project(s). If more than one project is down-
selected in Phase III, FRA will select one of them for final design, 
engineering, and construction funding. Detailed agreements for the 
construction and operation of the selected project will be negotiated.
    (2) Timing of Major Milestones.
    (i) March 31, 2001--If more than one project is down-selected in 
Phase III, FRA will select one project.
    (ii) December 31, 2001--FRA will issue a Final Record of Decision 
on the site-specific EIS for the one selected project, confirming the 
project design.
    (f) Phase V--Completion of Detailed Engineering and Construction 
January 1, 2002 and beyond). In Phase V, the sponsoring State or State-
designated authority will oversee the efforts of the public/private 
partnership formed to progress the selected project, to complete the 
detailed engineering designs, and finance, construct, equip, and 
operate the project in revenue service. Construction will be contingent 
upon the appropriation of Federal funds. In no event will construction 
be authorized until FRA is fully satisfied that the system will meet 
appropriate safety standards.


Sec. 268.5  Federal funding sources for the Maglev Deployment Program.

    (a) Federal Maglev Funds. Section 322 of Title 23 provides for the 
following funds for the Maglev Deployment Program:
    (1) Contract authority. Fifty-five million has been made available 
for the Maglev Deployment Program as contract authority from the 
Highway Trust Fund for Fiscal Years 1999 through 2001; this would be 
used to fund the competition in all its phases and could also be used 
for final design, engineering, and construction activities of the 
selected project. Of the $55 million, the Congress has made available 
up to $15 million for Fiscal Year 1999, up to $15 million for Fiscal 
Year 2000, and $25 million for Fiscal Year 2001.
    (2) Authorization for appropriations. Nine hundred fifty million, 
also from the Highway Trust Fund, has been

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authorized to be appropriated for the Maglev Deployment Program for 
Fiscal Years 2000 through 2003. Of the $950 million, $200 million is 
authorized to be appropriated for each of Fiscal Years 2000 and 2001, 
$250 million for Fiscal Year 2002, and $300 million for Fiscal Year 
2003. Any decision to proceed with possible Federal funding of the 
construction of a Maglev system will be contingent upon the receipt of 
appropriations, and upon completion of appropriate environmental 
documentation.
    (b) Other Federal funds. Section 322 of Title 23 provides that the 
portion of the Maglev project not covered by Federal Maglev Funds may 
be covered by any non-Federal funding sources--including private (debt 
and/or equity), State, local, regional, and other public or public/
private entities--as well as by Federally-provided STP and CMAQ funds, 
and by other forms of financial assistance made available under title 
23 and TEA 21, such as loans and loan guarantees.
    (c) Costs Incurred in Advance of Cooperative Agreement. Certain 
costs incurred in advance of the execution of a cooperative agreement 
between FRA and the grantee for pre-construction planning but after 
enactment of TEA 21 (June 9, 1998) will be eligible for reimbursement, 
but such costs are allowable only to the extent that they are otherwise 
allowable under the terms of a fully executed cooperative agreement.


Sec. 268.7  Federal/State share and restrictions on the uses of Federal 
Maglev Funds.

    (a) Federal share. The Federal share of Full Projects Costs shall 
be not more than \2/3\, with the remaining \1/3\ paid by the grant 
recipient using non-Federal funds. Funds made available under STP and 
CMAQ are considered non-Federal funds for purposes of the matching 
requirement.
    (b) Restrictions on the uses of Federal Maglev Funds.
    (1) Federal Maglev Funds may be applied only to Eligible Project 
Costs;
    (2) Federal Maglev Funds provided under a preconstruction planning 
grant may be used only for Phase II activities, and for completion of 
site-specific draft EIS's; see Sec. 268.3;
    (3) Federal Maglev Funds may be used to pay for only \2/3\ of 
preconstruction planning costs; grant recipients are required to pay 
the remaining \1/3\ of the costs with non-Federal funds; and
    (4) The ``prevailing wages'' requirement of the Davis Bacon Act (40 
U.S.C. 276a-276a-5) applies to any construction contracts under the 
Maglev Deployment Program.

Subpart B--Procedures For Financial Assistance


Sec. 268.9  Eligible participants.

    Any State, or any authority designated by one or more State(s) to 
carry out the preconstruction planning activities under the Maglev 
Deployment Program is eligible to participate in the Maglev Deployment 
Program.


Sec. 268.11  Project eligibility standards.

    (a) Project eligibility standards for preconstruction planning 
financing. (1) As required by 23 U.S.C. 322(d)(4), in order to be 
eligible to receive financial assistance, a Maglev project shall:
    (i) Involve a segment or segments of a high-speed ground 
transportation corridor that exhibit Partnership Potential;
    (ii) Require an amount of Federal funds for project financing that 
will not exceed the sum of Federal Maglev Funds, and the amounts made 
available by States under STP and CMAQ;
    (iii) Result in an operating transportation facility that provides 
a revenue producing service;
    (iv) Be undertaken through a public and private partnership, with 
at least \1/3\
of Full Project Costs paid using non-Federal funds;
    (v) Satisfy applicable statewide and metropolitan planning 
requirements;
    (vi) Be approved by FRA based on an application submitted by a 
State or authority designated by one or more States;
    (vii) To the extent that non-United States Maglev technology is 
used within the United States, be carried out as a technology transfer 
project; and
    (viii) Be carried out using materials at least 70 percent of which 
are manufactured in the United States.
    (2) FRA recognizes that applicants for preconstruction planning 
grants will not have detailed information with respect to some of the 
requirements of paragraph (a)(1) of this section, and that the purpose 
of a preconstruction planning grant is to develop much of this 
information with respect to a particular Maglev project. As required by 
Sec. 268.15, an applicant will need to provide whatever information it 
has with respect to each of the requirements of paragraph (a)(1) of 
this section, together with a certification that the applicant fully 
intends to comply with the requirements of this paragraph (a) should 
its project be selected by FRA for final design, engineering and 
construction financing.
    (b) Project eligibility standards for final design, engineering, 
and construction financing. FRA will select the most promising Maglev 
project for final design, engineering, and construction financing. To 
be eligible to be considered, the project must meet each of the 
following requirements; these requirements restate the requirements in 
paragraph (a)(1) of this section, but with more detail and in a 
different order:
    (1) Purpose and significance of the project. (i) The project 
description shall point to a Maglev facility and daily operation the 
primary purpose of which is the conduct of a revenue-producing 
passenger transportation service between distinct points, rather than a 
service solely for the passengers' riding pleasure.
    (ii) The project description shall incorporate scheduled operation 
at a top speed of not less than 240 mph.
    (2) Benefits for the American economy. The project description 
shall include a certification as to paragraphs (b)(2) (i) and (ii) of 
this section and, as appropriate, a technology acquisition/transfer 
plan which describes the strategy for their accomplishment.
    (i) Processes will be established that will enable an American-
owned and -sited firm (or firms) to gain, in the course of the project, 
the capability to participate in the design, manufacture, and 
installation of the facilities and vehicles needed for a Maglev 
operation, if the owner of the selected version of Maglev technology is 
not an American-owned and -sited firm (thus meeting the technology 
transfer requirement of 23 U.S.C. 322).
    (ii) The 70 percent U.S. content requirement content of 23 U.S.C. 
322 will be carried out.
    (3) Partnership potential. The project shall exhibit Partnership 
potential by satisfying the following:
    (i) A private/public partnership must be in place that is ready, 
willing, and able to finance, construct, operate, and maintain the 
project;
    (ii) The private/public partnership either owns the version of 
Maglev technology proposed to be implemented in the project, or has an 
agreement with the owner which affords full cooperation to the 
partnership in progressing the project, including implementation of the 
technology acquisition/transfer plan if applicable; and
    (iii) The recipient of a preconstruction planning grant or the FRA 
has developed and endorsed a projection of system capital costs, 
demand, revenues, operating expenses, and total costs and benefits, 
that:
    (A) Covers either the entire corridor in which the Maglev project 
is involved

[[Page 2347]]

(``Corridor''), or the project considered independently;
    (B) Demonstrates that private enterprise would be able to run the 
Corridor or the project--once built and paid for--as a completely self-
sustaining entity, in which revenues will cover operating expenses and 
continuing investment needs; and
    (C) Shows total benefits equal to or exceeding total costs.
    (4) Funding Limits and Sources. The project description shall 
include a financing plan that demonstrates project completion with the 
$950 million in Federal Maglev Funds, funds remaining unobligated from 
the $55 million in contract authority, and the funds made available 
under STP and CMAQ. The project that is selected will be eligible for 
other forms of financial assistance provided under title 23 and TEA 21, 
including loans, loan guarantees, and lines of credit. However, at 
least \1/3\ of Full Project Costs must come from non-Federal Funds.
    (5) Project Management. The State, the technology owner, and all 
other relevant project partners must include in the project 
description, an agreed upon--
    (i) Management plan that defines the partnership, responsibilities, 
and procedures for accomplishing the project;
    (ii) Project schedule that shows how timely implementation of the 
project will be accomplished, including, to the extent possible, a 
construction plan and schedule; and
    (iii) Financial plan that shows how funds will flow, in accordance 
with the other requirements of this subsection.
    (6) Planning/environmental process.
    (i) Assessment of environmental consequences of the proposed 
project. Recipients of preconstruction planning grants shall conduct an 
EA in support of the project description; and will prepare additional 
environmental studies for the project. The EA shall include information 
to support the grantee's decision to pursue the proposed project. The 
grantee shall develop the information and discuss the environmental 
consequences of the proposed technology and route in sufficient detail 
for the preparation of appropriate documentation by FRA to support 
selection of one project. This shall include: the identification of 
potential positive and negative environmental effects resulting from 
the technology (e.g. energy consumption compared to other 
transportation options); generic noise emissions at various distances 
from the centerline of the guideway; changes in electromagnetic field 
levels at various distances from the centerline of the guideway; and 
environmental screening of the proposed route (e.g., identification of 
land use; identification of endangered species possibly present and 
location of their critical habitat; identification of navigable 
waterways, wetlands and other sensitive water resources; and 
identification of the location of parks, wildlife refuges, historic and 
archaeological sites of National, State or local significance and other 
sites protected by section 4(f) of the Department of Transportation 
Act). The latter information and analysis shall be submitted four 
months in advance of the remainder of the project description. The 
above list is illustrative only. Grantees will be expected to review 
proposed work statements with FRA at pre-application meetings or 
through some other means to develop the final scope of this 
environmental review.
    (ii) The project description must also include letters of 
endorsement of project implementation from all the State departments of 
transportation involved, and from all Metropolitan Planning 
Organizations for metropolitan areas that would be served by the 
project.


Sec. 268.13  Deadline for submission of applications for 
preconstruction planning assistance.

    Completed application packages shall be returned to FRA by December 
31, 1998. Applications shall be submitted to: Honorable Jolene M. 
Molitoris, Administrator, Federal Railroad Administration, ATTN: Maglev 
Project, RDV-11, 400 Seventh Street, SW, Stop 20,Washington, DC 20590.


Sec. 268.15  Form and contents of applications for preconstruction 
planning assistance.

    States, groups of States, or designated authorities that have 
Maglev projects are invited to submit applications in Phase I of the 
Maglev Deployment Program, the competition for preconstruction planning 
grants. The applications shall contain:
    (a)(1) If submitted by a State: name, address, responsible party, 
telephone, fax number, and e-mail address of the State agency 
submitting the application; or
    (2) If submitted by a designated authority: name, address, 
responsible party, telephone, fax number, and e-mail address of the 
designated authority and of the State agency or agencies on whose 
behalf the designated authority is submitting the application, together 
with letters from the State(s) evidencing all such designations;
    (b) A description of the project concept, identifying its likely 
location, market area, length, and the transportation service that it 
would perform, and a preliminary estimate of the time that would be 
required--if funds are made available--to bring the project to the 
start of construction and then to the initiation of full revenue 
service. At its option, the applicant may include any reports already 
completed on the project as well as any additional descriptive material 
that would assist the FRA in evaluating the application;
    (c) Whatever information the applicant has to demonstrate that the 
project meets the project eligibility standards in Sec. 269.11(a), and 
the project selection criteria in Sec. 268.17. together with a 
certification that the applicant fully intends to comply with the 
requirements in Sec. 269.11 should its project be selected by FRA for 
final design, engineering and construction financing.
    (d) A statement of work for the preconstruction planning activities 
to be accomplished under the planning grant. The statement shall 
describe the work to be performed, including but not necessarily 
limited to:
    (1) Preconstruction planning work as is needed to develop a Maglev 
project, and project description that will satisfy the project 
eligibility standards in Sec. 268.11(b), and the project selection 
criteria in Sec. 268.17; and
    (2) Preparation of EAs, as described in Sec. 268.11(b)(6)(i);
    (e) Management plan, schedule, and financial plan for accomplishing 
the preconstruction planning work under the planning grant;
    (f) Letters supporting the application from the heads of all State 
departments of transportation involved, as well as from responsible 
officials of the Metropolitan Planning Organizations of all 
metropolitan areas to be served by the proposed project;
    (g) A certification from the State, or from the authority 
designated by one or more States, that the \1/3\ matching funds 
required for work under the planning grant are, or will be, available 
by the time the grants are announced. The source(s) of the matching 
must be shown in the financial plan under paragraph (e); and
    (h) If the applicant has made a definitive choice of the particular 
Maglev technology proposed to be included, a description of that 
technology and the degree to which it has been produced and tested 
should be submitted. Further, if the applicant has identified 
organizations that would form members of the team that would implement 
the project, the names of those organizations and the persons

[[Page 2348]]

representing them should also be submitted.


Sec. 268.17  Project selection criteria.

    Except as qualified by Sec. 268.19, the following criteria will 
govern FRA's selection of projects to receive funding under the Maglev 
Deployment Program.
    (a) Purpose and significance of the project.
    (1) The degree to which the project description demonstrates 
attractiveness to travelers, as measured in passengers and passenger-
miles.
    (2) The extent to which implementation of the project will reduce 
congestion, and attendant delay costs, in other modes of 
transportation; will reduce emissions and/or energy consumption; or 
will reduce the rate of growth in needs for additional highway or 
airport construction. Measures for this criterion will include but not 
be limited to the present value of congestion reduction, pollution 
reduction, and/or facility cost-avoidance benefits.
    (3) The degree to which the project will demonstrate the variety of 
operating conditions which are to be expected in the United States.
    (4) The degree to which the project will augment a Maglev corridor 
or network that has been identified, by any State, group of States, or 
the FRA, as having Partnership Potential.
    (b) Timely implementation. The speed with which the project can 
realistically be brought into full revenue service, based on the 
project description and on the current and projected development status 
of the Maglev technology selected by the applicant for the project.
    (c) Benefits for the American economy. The extent to which the 
project is expected to create new jobs in traditional and emerging 
industries in the United States.
    (d) Partnership potential. The degree to which the project 
description demonstrates Partnership Potential for the corridor in 
which it is involved, and/or for the project independently.
    (e) Funding limits and sources.
    (1) The extent and proportion to which States, regions, and 
localities commit to financially contributing to the project, both in 
terms of their own locally-raised, entirely non-Federal funds, and in 
terms of commitments of scarce Federal resources from non-Maglev funds; 
and
    (2) The extent and proportion to which the private sector 
contributes financially to the project.

    Note to Sec. 268.17: FRA recognizes that applicants for 
preconstruction planning assistance may not have detailed 
information with respect to each of these criteria, and that the 
purpose of the preconstruction planning assistance is to develop 
much of this information with respect to a particular Maglev 
project. The preconstruction planning application requirements of 
this part 268 are designed to elicit whatever information an 
applicant may have pertaining to these criteria.


Sec. 268.19  Evaluation of applications for preconstruction planning 
assistance.

    The FRA will evaluate the applications for their completeness and 
responsiveness to the requirements listed in Sec. 268.15. In addition, 
applicants are advised that the Maglev Deployment Program contains a 
number of project eligibility standards (minimum threshold standards) 
and project evaluation criteria that will guide the FRA's review of the 
project descriptions produced under the Planning Grants. The FRA's 
implementation of these standards and criteria appears in Sec. 268.11 
and Sec. 268.17, respectively. Although subject to revision, the 
information in Sec. 268.11 and Sec. 268.17 should assist the States in 
completing their applications in the competition for planning grants, 
since the project descriptions will need to respond to the standards 
and criteria. In evaluating the applications for planning grants, FRA 
will consider how consistent the applicant's project is to the 
standards and criteria, and the application's likelihood of leading to 
a project that meets all the standards and criteria.


Sec. 268.21  Down-selection of one or more Maglev projects for further 
study and selection of one project for final design, engineering, and 
construction funding.

    (a) Upon completion of Phase III of the Maglev Deployment Program, 
FRA will down-select one or more projects to complete additional 
environmental studies, investment grade revenue forecasts, and other 
studies and analyses necessary prior to initiation of construction. 
Final design and engineering work will also be initiated for the down-
selected project(s). To be down-selected a project must appear to meet 
the project eligibility standards contained in Sec. 268.11 (b), rate 
highly in the project selection criteria specified in Sec. 268.17, be 
judged by FRA to have a good chance of being constructed with the 
Federal funds authorized for this program, and be successfully operated 
by a public/private partnership.
    (b) Only one project will be selected in Phase IV of the Maglev 
Deployment Program and be eligible for any Federal construction funds 
that Congress chooses to make available. That one project must meet 
each and every project eligibility standard contained in Sec. 268.11 
(b). If more than one project down-selected in Phase III and funded 
through Phase IV meets all of these standards, then FRA will evaluate 
and compare the eligible projects according to the set of project 
selection criteria contained in Sec. 268.17.
    (c) In reviewing competing projects under the project eligibility 
standards and project selection criteria, the FRA will exercise 
particular vigilance regarding the following elements of the 
preconstruction planning process, although not to the exclusion of 
others:
    (1) The credibility of the demand and revenue forecasts, cost 
estimates, and benefit/cost comparisons; and
    (2) The credibility of the financial plan.
    (d) FRA intends to make periodic reviews of the processes and 
products of grant recipients. Such reviews may include, at the FRA's 
option, reviews at key milestones in the preparation of project 
descriptions.

    Issued in Washington, DC on January 4, 2000.
Jolene M. Molitoris,
Federal Railroad Administrator.
[FR Doc. 00-613 Filed 1-13-00; 8:45 am]
BILLING CODE 4910-06-P