[Federal Register Volume 71, Number 172 (Wednesday, September 6, 2006)]
[Notices]
[Pages 52610-52619]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-14733]


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DEPARTMENT OF TRANSPORTATION

Federal Transit Administration

[Docket No. FTA-2006-24037]


Elderly Individuals and Individuals With Disabilities, Job Access 
and Reverse Commute, and New Freedom Programs: Coordinated Planning 
Guidance for FY 2007 and Proposed Circulars

AGENCY: Federal Transit Administration (FTA), DOT.

ACTION: Guidance for FY 2007 implementation; notice of availability of 
proposed circulars.

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SUMMARY: The Federal Transit Administration (FTA) has placed in the 
docket and on its Web site, proposed guidance in the form of circulars 
to assist grantees in implementing the Elderly Individuals and 
Individuals with Disabilities (Section 5310), Job Access and Reverse 
Commute (JARC), and New Freedom Programs beginning in FY 2007. By this 
notice, FTA invites public comment on the proposed circulars for these 
programs. This notice also includes guidance for FY 2007 implementation 
for the coordinated planning process.

DATES: Comments should be submitted by November 6, 2006. Late-filed 
comments will be considered to the extent practicable.

ADDRESSES: You may submit comments identified by the docket number 
[FTA-2006-24037] by any of the following methods:
    1. Web Site: http://dms.dot.gov. Follow the instructions for 
submitting comments on the DOT electronic docket site.
    2. Fax: 202-493-2251.
    3. Mail: Docket Management Facility; U.S. Department of 
Transportation, 400 Seventh Street, SW., Nassif Building, PL-401, 
Washington, DC 20590-0001.
    4. Hand Delivery: Room PL-401 on the plaza level of the Nassif 
Building, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5 
p.m., Monday through Friday, except Federal holidays.
    Instructions: You must include the agency name (Federal Transit 
Administration) and Docket number (FTA-2006-24037) for this notice at 
the beginning of your comments. You should submit two copies of your 
comments if you submit them by mail. If you wish to receive 
confirmation that FTA received your comments, you must include a self-
addressed stamped postcard. Note that all comments received will be 
posted, without change, to http://dms.dot.gov including any personal 
information provided and will be available to internet users. You may 
review DOT's complete Privacy Act Statement in the Federal Register 
published on April 11, 2000 (65 FR 19477) or you may visit http://dms.dot.gov. Docket: For access to the docket to read background 
documents and comments received, go to http://dms.dot.gov at any time 
or to Room PL-401 on the plaza level of the Nassif Building, 400 
Seventh Street, SW., Washington, DC between 9 a.m. and 5 p.m., Monday 
through Friday, except Federal holidays.

FOR FURTHER INFORMATION CONTACT: Henrika Buchanan-Smith or Bryna 
Helfer, Office of Program Management, Federal Transit Administration, 
400 Seventh Street SW., Room 9114, Washington, DC, 20590, phone: (202) 
366-4020, fax: (202) 366-7951, or e-mail, [email protected]; [email protected]; or Bonnie Graves, Office of Chief 
Counsel, Federal Transit Administration, 400 Seventh Street SW., Room 
9316, Washington, DC, 20590, phone: (202) 366-4011, fax: (202) 366-
3809, or e-mail, [email protected].

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Overview
II. Guidance for the Coordinated Planning Process for FY 07
III. Chapter-by-Chapter Analysis
    A. Chapter I--Introduction and Background
    B. Chapter II--Program Overview
    C. Chapter III--General Program Information
    1. Elderly Individuals and Individuals with Disabilities 
(Section 5310)
    2. Job Access and Reverse Commute (JARC) and New Freedom
    D. Chapter IV--Program Development
    1. Elderly Individuals and Individuals with Disabilities 
(Section 5310)
    2. Job Access and Reverse Commute (JARC) and New Freedom
    E. Chapter V--Coordinated Planning
    F. Chapter VI--Program Management and Administrative 
Requirements
    G. Chapter VII--State and Program Management Plans
    H. Chapter VIII--Other Provisions
    I. Appendices

I. Overview

    First, this notice establishes program guidance on how to implement 
the new coordinated public transit-human services transportation 
planning requirements for fiscal year 2007 for the Elderly Individuals 
and Individuals with Disabilities (Section 5310), Job Access and 
Reverse Commute (JARC), and New Freedom programs. These requirements 
are based on provisions in the statute as well as issues raised and 
commented on during the public comment period. The March 15, 2006, 
Federal Register notice provided interim guidance for implementing the 
Section 5310, JARC and New Freedom programs for fiscal year 2006.
    Second, this notice provides summaries of the proposed Section 
5310, JARC and New Freedom program circulars on which FTA seeks 
comment, and responds to comments received in response to the March 15, 
2006, Federal Register notice. These programs are affected by the Safe, 
Accountable, Flexible, Efficient Transportation Equity Act: A Legacy 
for Users (SAFETEA-LU, Pub. L. 109-59), signed into law on August 10, 
2005. The Section 5310 program provides funding, allocated by a 
formula, to States for capital projects to assist in meeting the 
transportation needs of older adults and persons with disabilities. The 
States administer this program. The current Section 5310 circular, 
developed in 1998, needs to be updated to reflect changes in the law. 
The JARC program was authorized as a discretionary program under the 
Transportation Equity Act for the 21st Century (TEA-21, Pub. L. 105-
178, June 9, 1998), and changed to a formula program under SAFETEA-LU. 
The JARC program provides formula funding to States and designated 
recipients to support the development and maintenance of job access 
projects designed to transport welfare recipients and eligible low-
income individuals to and from jobs and activities related to their 
employment. The JARC program also supports reverse commute projects 
designed to transport residents of urbanized areas and other than 
urbanized areas to suburban employment opportunities. The New Freedom 
program is newly established in SAFETEA-LU. The purpose of the New 
Freedom program is to provide new public transportation services and 
public transportation alternatives beyond those required by the 
Americans with Disabilities Act of 1990 (42 U.S.C. 12101 et seq.) that 
assist individuals with disabilities with transportation, including 
transportation to and from jobs and employment support services.
    FTA conducted extensive outreach to develop these proposed 
circulars. First, FTA held initial listening sessions in Washington, DC 
in September, 2005. Then, FTA requested comments related to the Section 
5310, JARC and New Freedom programs in a notice published

[[Page 52611]]

on November 30, 2005 (70 FR 71950), and held listening sessions in five 
cities around the country. Subsequent to that notice, FTA published in 
the Federal Register on March 15, 2006 (71 FR 13456), proposed 
strategies for implementing these programs and requested comments on 
those strategies. In addition, FTA conducted an all-day public meeting 
on March 23, 2006, and held a number of meetings and teleconferences 
with stakeholders. To ensure that we heard from a broad range of 
stakeholders and interested parties we extended the comment period of 
the March 15, 2006, Federal Register notice through May 22, 2006. FTA 
received more than 200 comments from State departments of 
transportation, trade associations, public and private providers of 
transportation services, metropolitan planning organizations (MPOs), 
individuals and advocates.
    This document does not include the proposed circulars; electronic 
versions of the circulars may be found on the docket, at http://dms.dot.gov, docket number FTA-2006-24037, or on FTA's Web site, at 
http://www.fta.dot.gov. Paper copies of the circulars may be obtained 
by contacting FTA's Administrative Services Help Desk, at (202) 366-
4865.
    FTA seeks comment on these proposed circulars.

II. Guidance for the Coordinated Planning Process for FY 2007

    SAFETEA-LU requires that projects selected for funding be derived 
from a coordinated public transit-human services transportation plan 
(``coordinated plan'') beginning in FY 2006 for JARC and FY 2007 for 
Section 5310 and New Freedom. Based upon comments received from the 
public, FTA establishes the requirements for implementing these 
provisions for FY 2007 program participants below.
    A number of commenters requested a phased-in approach for building 
a coordinated plan. Many had concerns that a coordinated plan could 
take significant time to develop, and asked whether planning agencies 
could ``show progress'' toward a fully coordinated plan, or simply 
insert an addendum to update an existing plan, to demonstrate 
compliance for FY 2007. Some States already started their FY 2007 
selection process for Section 5310 funds, and expressed concern that 
award of those funds could be delayed if they had to go back and create 
new coordinated plans. Finally, some commenters, responding to FTA's 
March 15, 2006, proposal that existing JARC plans ``may satisfy the 
coordinated planning requirement for FY 2006'' asked FTA to 
affirmatively adopt the position that any JARC plan found sufficient 
under the FY 2005 requirements will be presumed sufficient for FY 2006.
    In response, FTA first notes that projects selected for FY 2007 
must be derived from a coordinated plan. FTA agrees with some of the 
commenters and will consider plans developed before the issuance of 
final program circulars to be an acceptable basis for project selection 
if they meet minimum criteria. Plans for FY 2007 should include: (1) An 
assessment of available services; (2) an assessment of needs; and (3) 
strategies to address gaps for target populations. FTA recognizes that 
initial plans may be less complex in one or more of these elements than 
a plan developed after the local coordinated planning process is more 
mature. Addendums to existing plans to include these elements will also 
be sufficient for FY 2007. Plans must be developed in good faith in 
coordination with appropriate planning partners and with opportunities 
for public participation. This good faith effort should be documented. 
JARC plans found sufficient under FY 2005 requirements are considered 
sufficient for FY 2006; plans for FY 2007 should be developed in good 
faith with planning partners and include the elements discussed above. 
Full implementation of the coordinated planning requirements will take 
effect for projects funded in FY 2008.
    FTA recognizes the importance of local flexibility in developing 
plans for human service transportation and strongly supports 
communities building on existing assessments, plans, and action items. 
In some cases, formulation of these assessments, plans and actions may 
have taken place through, or in coordination with, the applicable 
metropolitan or statewide planning program. To that end, and as 
appropriate, FTA encourages consistency between these various planning 
activities, including public outreach and participation. FTA encourages 
communities to consider inclusion of new partners, new outreach 
strategies, and new activities related to the targeted programs and 
populations.

III. Chapter-by-Chapter Analysis

    All three circulars generally follow the same format. Where 
possible, this notice discusses the chapters in general terms. Where 
the chapters vary significantly, as in Chapters III and IV, the 
discussion is specific to each program. This section addresses public 
comments received in response to the March 15, 2006, notice.
    A few commenters thought the proposed guidance was ``too 
prescriptive;'' however, many commenters commended FTA for its 
willingness to be flexible in its approach and encouraged FTA to permit 
as much flexibility as possible at the local level in implementing 
these programs. FTA believes these proposed circulars provide the 
flexibility requested while allowing for consistent implementation that 
will meet the goals of the Federal programs.

A. Chapter I--Introduction and Background

    Chapter I is an introductory chapter in all three circulars. This 
chapter covers general information about FTA and how to contact us, 
briefly reviews the authorizing legislation for the specific program 
(i.e., Section 5310, JARC, or New Freedom), provides information about 
Grants.gov, includes definitions applicable to the specific program and 
provides a brief program history. During our preliminary outreach 
efforts, FTA did not receive any comments on the information found in 
Chapter I.

B. Chapter II--Program Overview

    Chapter II provides more detail about the programs. This chapter 
starts with the statutory authority for the specific program, including 
the Congressionally authorized amount of funding and how the funds are 
apportioned. The chapter then discusses the goals of the program, 
followed by the State or recipient's role and FTA's role in program 
administration. There is a brief overview of how the specific program 
relates to other FTA programs, and an overview of coordination with 
other Federal programs through the Federal Interagency Coordinating 
Council on Access and Mobility. Since this is an ``overview'' chapter, 
the substance is covered in more detail in later chapters. Therefore, 
comments relating to information in Chapter II will be discussed in 
those chapters.

C. Chapter III--General Program Information

    Due to the differences in program requirements, the discussion of 
this chapter is divided by program.
1. Chapter III--Section 5310
    FTA first notes that there is an existing Section 5310 Circular, 
9070.1E, issued in October, 1998. The final circular, when adopted, 
will supersede that circular. The proposed circular incorporates 
changes made to the program as a result of SAFETEA-LU. Significantly, 
SAFETEA-LU permits the use of up to 10% of Section 5310 funding for 
expenses related to program administration, planning, and technical

[[Page 52612]]

assistance (consistent with FTA's longstanding administrative 
practice). The law increases coordination requirements and allows the 
local funding share to include amounts available for transportation 
from other non-DOT Federal agencies, as well as Federal lands highway 
funding. SAFETEA-LU also establishes a pilot program that allows seven 
States to use up to 33% of their Section 5310 funds for operating 
expenses. FTA issued general guidance for the pilot program in a 
Federal Register notice (70 FR 69201, Nov. 14, 2005) and announced the 
States selected to participate in a later Federal Register notice (71 
FR 59101, Feb. 3, 2006). The pilot program is not included in the 
proposed circular.
    Chapter III addresses State agency designation, apportionment of 
Section 5310 funds, when the funds are available to the States, under 
what circumstances funds may be transferred, consolidation of grants to 
insular areas, who is an eligible subrecipient, administrative 
expenses, eligible capital expenses, and Federal/local match 
requirements. This information compares to information found in Chapter 
II of the existing circular.
    The sections on State agency designation, apportionment of Section 
5310 funds, and consolidation of grants to insular areas remain 
unchanged from the existing Section 5310 circular. FTA proposes that 
Section 5310 funds will now be available for obligation for the year of 
apportionment plus two years, instead of being available only in the 
year of apportionment. Funds may be transferred to Section 5307 
(Urbanized Area Formula Grant) or Section 5311 (Other Than Urbanized 
Area Formula Grant) program accounts to ease overall program 
administration; however, funds must be used for projects eligible and 
selected under Section 5310. Because the funds must be used only for 
Section 5310 projects, funds will maintain their period of availability 
under Section 5310. Flexible Federal highway program funds transferred 
to Section 5310 will also be available for the year of transfer plus 
two years after the year of transfer.
    The current circular allows States to use up to $25,000 or 10% of 
the State's fiscal year apportionment for administrative costs, 
whichever is greater, and requires a 20% local share. SAFETEA-LU 
provides that not more than 10% of Section 5310 funds may be used to 
administer, plan, and provide technical assistance for funded projects. 
FTA no longer requires a local share for the administrative funds. The 
circular provides guidance on how a State may accumulate administrative 
funds over time for a special administrative need in a subsequent year, 
as long as the funds are used in the year of apportionment plus two 
years.
    FTA proposes that eligible capital expenses would remain 
substantially the same as in the existing circular, with the addition 
of mobility management activities as eligible expenses. The list of 
eligible activities is illustrative and not exhaustive.
    FTA proposes to require compliance with FTA's ``Capital Leases'' 
regulation, 49 CFR part 639, for leases of capital equipment and 
facilities financed under the Section 5310 program. When FTA Circular 
9070.1E was published in October 1998, FTA's Capital Leases regulation 
had not been promulgated, but TEA-21 extended cost evaluation 
regulations to all FTA assisted capital leases. Thus, FTA could only 
advise States to treat the FTA Capital Leases regulation as ``useful 
guidelines.'' By December 10, 1998, FTA did promulgate its Capital 
Lease regulation covering all FTA programs. Consequently, we propose 
requiring compliance with those regulations. However, we are seeking 
comments about the implications of doing so and are interested in how 
those regulations would affect State leasing practices.
    Section 5310 projects selected for funding must be derived from a 
coordinated plan (see Chapter V). Under Federal/local matching 
requirements, local share may now be derived from other non-DOT Federal 
programs that are eligible to be expended for transportation, as well 
as Federal lands highway funding. Examples of such Federal funding 
include, but are not limited to the Administration on Aging, Medicaid, 
Temporary Assistance for Needy Families, and Head Start.
    One commenter suggested that Section 5310 should be treated as a 
formula allocation to urbanized areas, instead of having to go through 
the State DOT, and that the State DOT should continue to administer the 
rural and small urbanized Section 5310 program. Section 5310 authorizes 
the Secretary to make grants to States and local governmental 
authorities under this program. However, unlike JARC and New Freedom, 
SAFETEA-LU established the State as the recipient for all funds 
appropriated under Section 5310. FTA makes grants to local governmental 
authorities for the special needs of elderly individuals and 
individuals with disabilities under other FTA programs, such as the 
urbanized area formula program. The statute requires the Secretary to 
apportion the amounts made available for Section 5310 under a formula 
that considers the number of elderly individuals and individuals with 
disabilities in each State. States then determine how to allocate the 
available funds.
    One commenter requested that FTA permit private for-profit bus 
companies to receive Section 5310 monies. SAFETEA-LU mandates that 
recipients and subrecipients be one of the following: States, local 
governmental authorities, or private non-profit agencies. Private for-
profit operators are not eligible to receive these funds as 
subrecipients. For-profit companies are encouraged to participate in 
the coordinated planning process, however, as local areas may identify 
ways in which private companies may be able to meet community 
transportation needs, such as through purchase of service arrangements, 
an eligible capital expense under the program.
    One commenter recommended that Section 5310 funds should not be 
used for medical assistance transportation. The Section 5310 program 
funds public transportation capital projects planned, designed, and 
carried out to meet the special needs of elderly individuals and 
individuals with disabilities, including medical transportation. States 
may fund any eligible subrecipient or project.
2. Chapter III--JARC and New Freedom
    The JARC and New Freedom programs have similar statutory 
requirements, so Chapter III, with the exception of Eligible 
Activities, is the same or similar for each circular. This chapter 
covers recipient designation, including designation in urbanized areas 
where there are multiple recipients; the role of the designated 
recipient; eligible subrecipients; apportionment, availability and 
transfer of funds; consolidation of grants to insular areas; recipient 
administrative expenses; eligible activities; and Federal/local 
matching requirements.
    a. Recipient Designation
    FTA sought comment on our proposed strategy that the designated 
recipient for JARC and New Freedom would not have to be the same as the 
Section 5307 designated recipient. We made this suggestion primarily as 
a means to resolve any perceived ``conflict of interest'' in the 
competitive selection process (discussed in Chapter IV).
    FTA received a wide range of comments on this proposal. Many 
commenters felt that the Section 5307 recipient should be the recipient 
for JARC and New Freedom program funds. Some commenters thought the MPO 
would make a good designated recipient for these funds, while still 
others thought the MPO was not equipped to be the designated recipient. 
(FTA notes

[[Page 52613]]

that the MPO is the designated recipient for Section 5307 in some 
urbanized areas). One commenter noted that the current planning 
regulations require MPOs to rank, evaluate, and select all regional 
transportation projects that use Federal transportation funds, 
therefore, the MPO has significant oversight over the planning and 
programming process, regardless of who the designated recipient is.
    In response, FTA proposes that the designated recipient for JARC 
and/or New Freedom in urbanized areas over 200,000 in population may be 
the same as the designated recipient for Section 5307 funds; however, 
it does not have to be the same designated recipient. The MPO, State, 
or another public agency may be a preferred choice based on local 
circumstances. The designation of a recipient should be made by the 
governor in consultation with responsible local officials and publicly 
owned operators of public transportation, as required in Section 
5307(a)(2). The recipient for JARC and New Freedom funds will apply to 
FTA for these funds on behalf of subrecipients within the recipient's 
area. Regardless of whether the JARC and New Freedom recipient is the 
same as or different than the Section 5307 designated recipient, the 
governor shall issue new designation of JARC and New Freedom recipient 
letters. Designations remain in effect until changed by the governor by 
official notice of redesignation to the appropriate FTA Regional 
Administrator.
    In urbanized areas with populations less than 200,000 and in other 
than urbanized areas, the State is the designated recipient for JARC 
and New Freedom funds. The governor designates a State agency 
responsible for administering the funds and notifies the appropriate 
FTA regional office in writing of that designation. The governor may 
designate the State agency receiving Other Than Urbanized Area formula 
funds (Section 5311) and/or Section 5310 funds to be the JARC and/or 
New Freedom recipient, or the governor may designate a different 
agency.
    A number of commenters had questions about urbanized areas with 
more than one designated recipient, and urbanized areas that cross 
State lines. Nothing precludes the designation of multiple designated 
recipients. When more than one recipient is designated for a single 
large urbanized area, the designated recipients must agree on how to 
divide the single apportionment to the urbanized area and notify FTA 
annually of the division and the geographic area each recipient will be 
responsible for managing. For multi-State urbanized areas of less than 
200,000 in population, the designated recipient for each State is 
responsible for that State's portion.
    Some commenters asked FTA to clarify the role of the designated 
recipient in the coordinated planning process (discussed further in 
Chapter V). FTA proposes that the designated recipient is not directly 
responsible for developing the coordinated plan, but is responsible for 
certifying that the projects funded are derived from a coordinated 
plan, developed in accordance with statutory requirements. The 
designated recipient or another organization may take the lead in 
developing the coordinated plan.
    b. Apportionment, Availability and Transfer of Funds
    Commenters had questions regarding apportionment, availability, and 
transfer of funds. Specifically, people asked about how geographic 
boundaries for large urbanized areas are determined, how the formula 
program works, why some areas that received JARC funds in the past have 
experienced reductions in funding levels, and why New Freedom funds 
cannot be transferred from one population area (such as rural) to 
another population area (such as small urbanized) within a State, since 
such transfer is permitted under the JARC program.
    For funding purposes, urbanized area boundaries are those defined 
by the U.S. Census Bureau based on the 2000 Census. The Census Bureau, 
during the decennial census, draws urbanized area boundaries and makes 
that information available to those areas. For coordinated planning 
purposes, the decision as to the boundaries of the local planning areas 
should be made in consultation with the State, designated recipients, 
and/or the MPO (see Chapter V).
    SAFETEA-LU apportions funds for JARC and New Freedom based on a 
formula that accounts for the number of eligible low-income and welfare 
recipients (JARC) or individuals with disabilities (New Freedom) in a 
particular area. For example, if the number of individuals with 
disabilities over age 5 in a large urbanized area with a population of 
200,000 or more equals 5% of the number of individuals with 
disabilities over age 5 in all such urbanized areas, that urbanized 
area will receive 5% of the New Freedom funds available for large 
urbanized areas. Similarly, if the number of low-income individuals and 
welfare recipients in the rural areas of a State equals 4% of the 
number of low-income individuals and welfare recipients in all rural 
areas nationwide, that State will receive 4% of the JARC funds 
available for rural areas. The annual apportionment is published in the 
Federal Register following the enactment of the annual DOT 
appropriations act.
    Under Section 3037 of TEA-21, JARC projects were selected through a 
national competition based on criteria specified in the statute. In FY 
2000, Congress began designating, in the conference reports 
accompanying the annual appropriations acts, specific projects and 
recipients to receive JARC funding. In FY 2005, all JARC funds were 
allocated to such designated projects and recipients. With the SAFETEA-
LU mandate that funds be distributed based on a formula, twenty-three 
States and the District of Columbia experienced a reduction in funding. 
Thirty-two States and territories experienced an increase in funding, 
including seventeen States and territories that did not receive JARC 
funding in FY 2005. Although SAFETEA-LU repealed Section 3037 of TEA-21 
and substituted the new provisions of 49 U.S.C. 5316, those projects 
designated by Congress under Section 3037, and not yet obligated, 
remain available to the project. These funds must be obligated under 
the terms and conditions of Section 3037.
    The formula-based JARC program is intended to provide an equitable 
and stable funding distribution to States and communities. FTA 
continues to provide maximum flexibility for communities to design 
plans and projects to meet the transportation needs of low-income 
individuals and welfare recipients. The process for preparing 
coordinated plans should be consistent with metropolitan and statewide 
transportation planning processes.
    New Freedom funds cannot be transferred from one population area 
(such as rural) to another population area (such as small urbanized) 
within a State. While such a transfer provision is statutorily 
permitted under the JARC program, this provision is not included in the 
New Freedom program. Therefore, FTA cannot allow this transfer of 
funds. Further, funds may not be transferred between the JARC and New 
Freedom programs; funds must be spent for the program for which they 
were apportioned except in insular areas. States may, however, transfer 
JARC and New Freedom funds to Section 5307 or Section 5311(c) to ease 
program administration, as long as the transferred funds are used for 
JARC or New Freedom projects, respectively. Transfer requests must be 
submitted to the appropriate FTA Regional Administrator in writing.

[[Page 52614]]

    Finally, funds are available for the year of apportionment plus two 
years. Therefore, if funds cannot be obligated in a grant during the 
year they are apportioned, they may be carried over for up to two 
years. Funds not obligated during this period will lapse and be 
reapportioned by FTA.
    c. Recipient Expenses (10%) for Administration, Planning, and 
Technical Assistance
    FTA received comments concerning the use of up to 10% of program 
funds available for the administration, planning, and technical 
assistance of Section 5310, JARC and New Freedom programs. These funds 
may be used directly by the designated recipient or they may be passed 
through to subrecipients for these purposes. For example, the 
designated recipient may award grants to local areas to support the 
development of the coordinated plan. The competitive selection process 
is part of ``administering'' the programs and, therefore, these funds 
may be used to conduct the competitive selection process. FTA also 
notes that non-emergency human services transportation planning is an 
eligible activity under Sections 5303 and 5304, metropolitan and 
statewide planning, respectively. Accordingly, local officials could 
propose coordination planning activities such as market research and 
service assessment to the State and/or MPO for inclusion in their 
transportation planning work programs.
    Several commenters expressed concern that 10% of the amount 
apportioned may not be sufficient to administer the program. FTA notes 
that there is no local match requirement for this funding, and proposes 
that recipients may ``pool'' the administrative funding available under 
Section 5310, JARC, and New Freedom in order to develop a single 
coordinated plan to meet the needs of persons with disabilities, older 
adults, and low-income individuals. Further, FTA treats the limitation 
on administrative funds as applicable to funds apportioned to 
recipients over time, not necessarily to the apportionment for a 
particular fiscal year. A recipient may accumulate the ``entitlement'' 
to administrative funds for the year of apportionment plus two years to 
augment the funds available for a special administrative need in a 
subsequent year.
    Some commenters expressed interest in using ``mobility management'' 
funds to develop the coordinated plan. Mobility management is an 
eligible expense under Section 5310, JARC, and New Freedom, and 
includes project planning activities. However, as with all JARC and New 
Freedom projects, any planning project under mobility management must 
be derived from the coordinated plan and must be competitively 
selected. Therefore, mobility management funds may not be used to 
develop the required coordinated plan.
    Finally, one commenter expressed a preference for being able to 
apply only for the 10% administration funds, and then amend grants 
later to fund project implementation, rather than funding the 
administration and planning under pre-award authority with 
reimbursement after total obligation. FTA agrees that designated 
recipients may apply for the administrative funds allowed under the 
program in advance of selecting projects in order to support the 
planning and selection process.
    d. JARC Eligible Activities
    SAFETEA-LU requires that JARC projects selected for funding be 
derived from a coordinated plan (see Chapter V) and that grants will be 
awarded on a competitive basis (see Chapter IV). Funds are available 
for capital, planning, and operating expenses that support the 
development and maintenance of transportation services designed to 
transport low-income individuals to and from jobs and activities 
related to their employment. The list of proposed eligible projects 
included in the circular is consistent with the use of funds described 
in FTA's April 8, 2002, Federal Register notice for JARC Program Grants 
(67 FR 16790). As requested by commenters, this list of eligible 
activities is illustrative, not exhaustive.
    FTA sought comment on whether transit passes should be an eligible 
expense under JARC. Commenters generally agreed that purchase of 
passes, rather than simply the promotion of voucher programs, should be 
an eligible expense. FTA proposes, however, that the purchase of 
transit passes for use on fixed route or ADA paratransit is not an 
eligible expense. The purchase of transit passes does not meet the 
overall program objective of adding new and expanded transportation 
capacity to connect low-income persons to jobs and employment services. 
Because the amount of funding available for JARC is limited, FTA 
believes it is more appropriate to spend those limited dollars on 
increasing service capacity. Further, a number of Federal programs are 
available to pay for transit passes for low-income workers, including 
the Temporary Assistance for Needy Families (TANF) program and 
Workforce Investment Act funds. Promotion of transit pass programs, 
however, remains an eligible expense. FTA proposes that vouchers could 
be used to fund alternative transportation services, such as mileage 
reimbursement as part of a volunteer driver program, taxi trips, or 
trips provided by human service agencies.
    FTA also sought comment on whether ``non-traditional'' public 
transportation options, including, but not limited to, car loan or 
ownership programs and shared-use station cars, should be eligible 
activities under the JARC program. Commenters generally support these 
options, but some expressed concern that it is difficult or impossible 
to monitor ``shared-use'' of cars purchased through car loan programs. 
Programs that support loans for the purchase of vehicles will continue 
to be eligible for JARC funding, as will transit-related bicycling 
facilities. Shared station cars--cars available for shared use and 
located at subway or other public transit stations--are not listed in 
the examples of eligible activities. While there may be limited 
circumstances when the provision of a shared station car might be 
appropriate to support access to short-term job related activities, 
such as interviews, FTA does not believe that purchase of shared 
station cars is generally appropriate to support daily commutes.
    Commenters agreed with FTA's proposal that existing JARC projects 
would continue to be eligible for funding, and some thought it would be 
appropriate to prioritize continuing JARC projects for funding. FTA 
believes this should be a local decision made through the planning 
process.
    Commenters suggested that telework expenses should be eligible for 
JARC. In response, FTA notes the purpose of the JARC program is to 
expand capacity of transit systems, and enable people to travel to 
their places of employment. Telework activities are not consistent with 
the overall objective of the program. Further, there are other Federal 
programs supporting telework activities, such as the Department of 
Education's Access to Telework program, which helps persons with 
disabilities have access to low-interest loans to purchase equipment to 
enable them to work from home.
    e. New Freedom Eligible Activities
    In the March 15, 2006, Federal Register notice, FTA proposed that 
``new public transportation services'' and ``public transportation 
alternatives beyond those required by the Americans with Disabilities 
Act (ADA)'' be considered separate categories of service. Most 
commenters supported that interpretation of the statute. In addition, 
many commenters wanted FTA to encourage creative uses of these funds to 
remove barriers to people with

[[Page 52615]]

disabilities. FTA also received comments regarding the limited 
availability of funds and congressional intent for implementing this 
program. FTA therefore proposes that projects eligible for New Freedom 
funds will be those that are ``new public transportation services that 
are beyond the ADA'' and ``new public transportation alternatives that 
are beyond the ADA.'' Projects that do not meet both criteria--new and 
beyond the ADA--are not eligible under the proposed guidance. Projects 
proposed by FTA as eligible in the March 15, 2006, notice that do not 
meet both criteria include existing paratransit enhancements and new or 
expanded fixed route service. FTA initially proposed including 
expansion of fixed route service as an eligible activity, especially in 
rural areas, because there are significant transit needs in some areas. 
Since this service is not beyond the ADA, it is not included as an 
eligible activity in the proposed guidance. FTA notes, however, that 
the Section 5311 program funding increased almost two-fold following 
the enactment of SAFETEA-LU, so those communities have an alternative 
funding source to meet those needs.
    In the March 15, 2006, Federal Register notice, FTA also proposed 
that ``new'' service would be limited to those projects not already 
included in a Transportation Improvement Plan (TIP) or a State 
Transportation Improvement Plan (STIP) as of August 10, 2005, the date 
SAFETEA-LU was signed into law. FTA received mixed comments on this 
proposal, and some requested clarification. FTA proposes that a ``new'' 
service is any service or activity that was not operational on or 
before August 10, 2005, and did not have an identified funding source 
as of August 10, 2005, as evidenced by inclusion in the TIP or STIP. In 
other words, if not for New Freedom funding, these projects would not 
have consideration for funding and proposed service or facility 
enhancements would not be available for individuals with disabilities. 
FTA notes that inclusion of projects in the metropolitan or statewide 
long-range transportation plans does not constitute a funding 
commitment. However, once a project is included in the TIP/STIP, it has 
an identified funding source. Therefore, FTA proposes that projects 
identified in a long-range metropolitan or statewide plan may be 
eligible for New Freedom funding, but not projects in the 4-year 
program period of the TIP/STIP. FTA proposes a maintenance of effort 
provision in the circular: recipients or subrecipients may not 
terminate paratransit enhancements or other services funded as of 
August 10, 2005, or remove facility improvements from the TIP/STIP in 
an effort to reintroduce the service as ``new'' and then receive New 
Freedom funds for those services.
    Some commenters requested that specific types of projects should be 
eligible for New Freedom funding, including way-finding technology and 
one-stop service centers. FTA proposes that both of these projects 
could be eligible if included as part of the coordinated planning 
process. One-stop service centers may be eligible under mobility 
management activities. The list of eligible activities in the proposed 
circular is illustrative, not exhaustive.
    FTA proposed in the March 15, 2006, Federal Register notice that 
administration of voucher and transit pass programs would be eligible 
expenses, but not the purchase of the vouchers themselves. Commenters 
generally agreed that purchase of passes, rather than simply the 
administration of voucher programs, should be an eligible expense. Some 
commenters offered the importance of using vouchers as an 
administrative mechanism to support volunteer driver and taxi programs. 
For this reason, FTA proposes that vouchers could be used to fund 
alternative transportation services, such as mileage reimbursement as 
part of a new volunteer driver program, or new trips provided by human 
service agencies. Because projects must be both new and beyond the ADA, 
and because of the limited funding available, FTA proposes that the 
purchase of transit passes for use on fixed route or ADA paratransit is 
not an eligible expense.
    Some commenters disagreed with FTA's assessment that door-to-door 
paratransit service is not beyond the ADA. However, the ADA regulation 
requires ``origin-to-destination'' service and the preamble to the 
regulation states that the decision to provide curb-to-curb or door-to-
door service is a local decision. 56 FR 45604; Sept. 6, 1991. In 
addition, guidance issued by the U.S. DOT on September 1, 2005, 
reiterated the ``origin-to-destination'' language and noted that, 
``service may need to be provided to some individuals, or at some 
locations, in a way that goes beyond curb-to-curb service.'' Other 
commenters were concerned that door-through-door service creates 
liability for the paratransit operator. FTA does not propose that 
operators must provide door-through-door service; it is simply one 
option that is considered an eligible activity for New Freedom funds.
    FTA received a few comments on its proposal to permit station 
improvements as eligible for New Freedom funding. Some commenters felt 
that because the amount of money available is limited, it would not be 
appropriate to use an entire year's apportionment on one project. This 
is a local decision. Another commenter felt that economies of scale 
could be realized if a second (redundant, not required) elevator were 
installed at the time of a planned station renovation. FTA proposes 
that New Freedom funds may be used to improve accessibility at existing 
transportation facilities, so long as the projects are clearly intended 
to remove barriers that would otherwise have remained, and are not 
projects that are part of an already planned station renovation or 
alteration. FTA agrees that installing redundant, not required 
accessibility improvements at the time of renovation may result in 
economies of scale and therefore proposes that these redundant 
improvements would be eligible for New Freedom funds.
    One commenter asked FTA to clarify that a designated recipient's 
decision to fund pedestrian improvements near bus stops, such as curb 
cuts, would not obligate New Freedom or other transit funding to fund 
all such improvements. While New Freedom funds should not supplant 
other funding sources, this type of activity is eligible under New 
Freedom if an accessible path of travel has been identified as a 
barrier for using fixed route transportation. However, if Federal 
highways or other funds are available for pedestrian improvements, 
those funds should be used first. The decision to fund a particular 
pedestrian improvement with New Freedom funds does not shift the 
responsibility for such improvements to transit operators.
    f. Federal/Local Match Requirements
    A grant for a capital project under the Section 5310, JARC and New 
Freedom programs may not exceed 80% of the net cost of the project. A 
grant for operating costs under these programs may not exceed 50% of 
the net operating costs of the project. Finally, a grant for 
administrative expenses incurred by these programs (up to 10% of the 
annual apportionment), may be fully funded by FTA. The proposed 
circular lists the potential sources of local funding match, including 
other Federal programs that provide funding for transportation. The 
sliding scale match available for Section 5310 (related to States with 
large Federal land areas) does not apply to the JARC or New Freedom 
program funds. As we stated in the March 15, 2006, notice, fare box 
revenue generally must be subtracted from gross project costs and is 
not eligible to be used as local funding match.

[[Page 52616]]

D. Chapter IV--Program Development

    Due to the differences in program requirements, the discussion of 
this chapter is divided by program.
1. Chapter IV--Section 5310
    Chapter IV provides an overview of planning requirements (described 
in further detail in Chapter V); describes the program of projects 
(POP), including the approval of and revisions to the POP; and 
describes pre-award authority, labor protections, and when public 
hearings are required. This information compares to information found 
in Chapter III of the existing Section 5310 Circular 9070.1E.
    FTA did not receive any substantive comments on the issues 
addressed in this chapter.

    Note: coordinated planning comments are addressed in Chapter V.

    Thus, FTA proposes only minor changes to this chapter. First, the 
planning requirements now reference the coordinated plan required under 
SAFETEA-LU. Second, the existing circular states that grants are 
awarded on a quarterly release cycle; the new circular reflects FTA's 
current commitment to promptly process grants upon receipt of a 
complete and acceptable grant application. Third, under ``Revisions to 
Program of Projects,'' FTA proposes a new paragraph for when grant 
revisions need to be made in FTA's Transportation Electronic Award and 
Management (TEAM) system. And fourth, the ``Public Hearing'' section 
clarifies and provides the statutory authority regarding public hearing 
requirements.
2. Chapter IV--JARC and New Freedom
    The JARC and New Freedom programs have the same statutory 
requirements for the areas covered by this chapter, so Chapter IV is 
the same for both circulars. This chapter provides a summary of the 
planning and coordination requirements (described in further detail in 
Chapter V); describes the competitive selection process and what 
constitutes a fair and equitable distribution of funds; describes the 
program of projects (POP), including approval of and revisions to the 
POP; and addresses certifications and assurances and pre-award 
authority.
    This chapter proposes guidance on how a designated recipient should 
conduct the competitive selection process. Most of the comments FTA 
received on this topic related to which agency should be the designated 
recipient for JARC and New Freedom funds, discussed in Chapter III. A 
number of commenters continue to be concerned that a ``conflict of 
interest'' exists when the designated recipient both conducts the 
competitive selection process and competes for projects. FTA notes, 
however, that in large urbanized areas, the process must be conducted 
in cooperation with the MPO, which should provide some degree of 
assurance that any potential conflict of interest is thus mitigated. 
Also, FTA proposes that while the designated recipient is responsible 
for conducting the process, it may, if it chooses, establish 
alternative arrangements to administer and conduct the competitive 
selection process.
    Some commenters requested that FTA require the proposed strategies 
FTA suggested for competitive selection rather than simply recommend 
them; others preferred that the strategies remain recommendations, 
allowing local designated recipients to determine the best way to 
conduct the competitive selection process. FTA agrees that the 
strategies should be suggestions only, in order to allow designated 
recipients the flexibility to determine what will work best in their 
community.
    A number of commenters requested clarification of what is actually 
competed. The law requires that designated recipients and States 
conduct a ``solicitation for applications for grants to the recipient 
and subrecipients under [the JARC and New Freedom programs].'' 49 
U.S.C. 5316(d), 49 U.S.C. 5317(d). Recipients and subrecipients seeking 
grants are required to submit an application to the designated 
recipient, which then evaluates and selects the final set of projects 
for funding. In the proposed circulars, FTA provides a number of 
examples that should help to clarify the competitive selection process. 
These examples support the concept that the competitive selection 
process is locally driven, taking into account local dynamics and 
funding levels.
    Some commenters wondered if JARC and New Freedom projects could be 
multi-year projects, and if so, if there is a limitation on the 
duration of multi-year projects. FTA proposes that competition for 
projects be conducted annually or at intervals not to exceed two years. 
This proposal would permit the selection of multi-year projects as long 
as they are derived from the coordinated planning process.
    Commenters were also concerned that the incumbent provider might 
have an advantage solely because it is the provider of services. Others 
wanted assurance that their presence at the coordinated planning table 
would not preclude them from competing for projects. In response, FTA 
proposes that the designated recipient will set the criteria for 
selection of projects, and a provider's participation in the local 
planning process will not preclude that provider from competing for 
projects.
    A few commenters requested clarification on what constitutes a 
``fair and equitable'' distribution of funds. FTA notes that equitable 
distribution refers to equal access to, and equal treatment by, a fair 
and open competitive process. The result of such a process may not be 
an ``equal'' allocation of resources among projects or communities. It 
is possible that some areas may not receive any funding at the 
conclusion of the competitive selection process. A successful 
competitive selection process will, however, minimize perceptions of 
unfairness in the allocation of program resources.
    The rest of this chapter addresses the program of projects. The 
language is consistent with the proposed Section 5310 circular.

E. Chapter V--Coordinated Planning

    The Section 5310, JARC, and New Freedom programs all require the 
development of a locally developed, coordinated public transit-human 
services transportation plan (``coordinated plan''). Each of the 
circulars for these three programs has the same requirements for 
coordinated planning; therefore, Chapter V is identical in all three 
circulars. This chapter includes the proposed definition of a 
coordinated plan, how a coordinated plan is developed, the level of 
public participation that is expected and strategies for inclusion, and 
the relationship of the coordinated plan to other planning processes.
    Some commenters suggested that FTA's coordinated planning process 
would be stronger if the circulars were issued jointly with other 
Federal agencies such as the U.S. Department of Health and Human 
Services. At the very least, suggested one commenter, acknowledgment 
and support from those Federal agencies whose involvement is deemed 
critical to the success of a coordinated planning process should be 
included.
    As stated in our March 15, 2006, notice, FTA is committed to 
working with our Federal partners through the United We Ride initiative 
and the Federal Interagency Coordinating Council on Access and Mobility 
(CCAM) to encourage agencies that receive Federal funding to 
participate in the coordinated planning process. In the 2005 Report to 
the President, CCAM outlined five recommendations for future action 
related to coordinated human services transportation. These

[[Page 52617]]

recommendations include two policy statements currently under review by 
CCAM members related to coordinated planning and vehicle sharing. Once 
approved and adopted by CCAM, CCAM will work with each member 
Department to implement the policy statements that build participation 
in coordinated human transportation services at the local level. In 
addition to these efforts, FTA encourages State DOT offices to work 
closely with their partner agencies and local governmental officials to 
educate policy makers about the importance of partnering with human 
services transportation programs and the opportunities that are 
available when building a coordinated system.
    Some commenters thought the definition of a coordinated plan, 
proposed in the Federal Register notice of March 15, 2006, was too 
expansive. As a result, FTA proposes to modify the definition of a 
coordinated plan as follows: ``a coordinated public transit-human 
services transportation plan identifies the transportation needs of 
individuals with disabilities, older adults, and people with low 
incomes, provides strategies for meeting those local needs, and 
prioritizes transportation services for funding and implementation.''
    FTA received comments both in support of and in opposition to the 
development of one plan or multiple plans for separate populations. The 
intent of building a coordinated plan is to build efficiencies in order 
to enhance transportation services; therefore, FTA proposes that 
communities will develop one coordinated plan. The benefit of enhancing 
coordinated transportation service systems is to break down the 
``silo'' transportation systems that often only address the 
transportation needs of one specific group of riders. Coordination can 
help provide more rides with the same dollars by minimizing service 
duplication and filling service gaps. SAFETEA-LU provides the ``table'' 
for all stakeholders, including services funded through other sources, 
to build a coordinated plan and ultimately a service delivery system 
that addresses the needs of target populations. While there may be some 
unique needs of each target population, the functional transportation 
needs of the three populations are often more similar than dissimilar. 
Even when unique needs exist, they are often associated with at least 
one or more subsets of the population. If a community does not intend 
to seek funding for a particular program, (Section 5310, JARC or New 
Freedom), then the community does not need to include those projects in 
its coordinated plan.
    Many commenters stated the elements of a coordinated plan and the 
requirements for developing the plan should be based on the size of a 
community and should remain flexible at the local level. In response to 
these comments, FTA proposes a variety of approaches for the 
development of a coordinated plan that lend themselves to local 
scenarios. FTA also recognizes the importance of local flexibility in 
developing plans for human service transportation and strongly supports 
communities building on existing assessments, plans and action items. 
However, all plans must meet the new requirements, and therefore 
communities may need to consider inclusion of new partners, new 
outreach strategies, and new activities related to the targeted 
programs and populations.
    Commenters also expressed support for and opposition to the 
specific elements proposed for the coordinated plan. In response to 
comments, FTA proposes that a coordinated plan includes the following 
elements:
    (a) An assessment of available services that identifies current 
providers (public, private, and nonprofit);
    (b) An assessment of transportation needs for individuals with 
disabilities, older adults, and people with low incomes. This 
assessment may be based on the experiences and perceptions of the 
planning partners or on more sophisticated data collection efforts, and 
gaps in service;
    (c) Strategies and/or activities to address the identified gaps and 
achieve efficiencies in service delivery; and
    (d) Relative priorities for implementation based on resources, 
time, and feasibility for implementing specific strategies/activities 
identified.
    Local plans may be developed on a local, regional, or statewide 
level. The decision as to the boundaries of the local planning areas 
should be made in consultation with the State, designated recipients, 
and/or the MPO. Commenters sought clarification of which agency should 
be the lead agency for developing the plan. Some commenters asked FTA 
to clarify the role of the designated recipient in the coordinated 
planning process. FTA proposes that the agency leading the planning 
process would be decided locally; the designated recipient or an agency 
or organization other than the designated recipient may take the lead 
in developing the coordinated plan. The designated recipient is not 
directly responsible for developing the coordinated plan, but is 
responsible for certifying that projects were derived from a 
coordinated plan, developed in accordance with statutory requirements.
    Some commenters thought the proposed coordinated planning 
activities outlined in the March 15, 2006, notice would require 
additional resources beyond those available through the 10% of 
administrative funds available from the recipient's apportionment. 
Several of the strategies outlined in Chapter V offer approaches that 
may be done with a range of resources based on local interest and need. 
Further, FTA proposes that administrative funds for the coordination 
strategies discussed in Chapter V may be supplemented with Sections 
5303 and 5304 Metropolitan Planning and Statewide Planning funds, as 
well as, Section 5307 formula funds and administrative funding 
available under Section 5311.
    Several commenters thought the proposed guidance for prioritizing 
services discussed in the March 15, 2006, notice required further 
consideration and clarification. FTA suggests in the proposed circulars 
that communities will develop priorities for implementation based on 
resources, time, and feasibility for implementing specific strategies/
activities within the plan. Also, these projects will need to be 
included in the applicable long-range plans and TIPs/STIPs to be 
eligible to receive funding under Section 5310, JARC and New Freedom. 
Therefore, FTA encourages coordination and consistency between local 
coordination planning and metropolitan/statewide planning processes.
    A number of commenters expressed the importance of full 
participation from public and private transportation providers, human 
service providers, and individuals with disabilities, older adults, and 
people with low incomes. FTA's suggested list of diverse participants, 
however, recognizes that stakeholders will vary by community, and 
therefore requires, at a minimum, evidence of outreach to stakeholders, 
including customers of transportation services (e.g., people with 
disabilities, older adults, individuals with low incomes). FTA also 
clarifies that participation in the planning process will not bar 
providers (public or private) from bidding to provide services 
identified in the coordinated planning process. FTA also notes that 
SAFETEA-LU expanded the range of public participation and stakeholder 
consultation requirements of metropolitan and statewide transportation 
planning--both in the activities to be performed and in the stakeholder 
groups to be involved. For this reason, FTA encourages consistency

[[Page 52618]]

between the local coordination planning process and the applicable 
metropolitan or statewide planning process.
    Since Section 5310 projects are managed and selected at the State 
level, several commenters requested further clarification on 
integrating the needs for the Section 5310 program into the coordinated 
plan in urbanized areas. In this case, communities applying for Section 
5310 funding from the State will have to demonstrate that the proposed 
activities are derived from a coordinated plan.
    Commenters were also interested in how they could participate in 
the adoption of the plan. FTA proposes that as a part of the 
coordinated planning process, participants should identify the process 
for adoption of the plan at the local level. This lends itself to local 
flexibility and decision making. In reference to comments regarding the 
need for increased oversight and evaluation of plans, FTA will not 
formally review and approve plans. However, the designated recipient's 
grant application will require documentation of the plan from which 
each project listed is derived, including the lead agency, the date of 
adoption of the plan, or other appropriate identifying information.
    FTA received comments on the relationship between the coordinated 
planning process and other transportation planning processes. FTA 
proposes that the coordinated plan can be developed either separately 
from the metropolitan and statewide transportation planning processes 
and then incorporated into the broader plans, or be developed as a part 
of the metropolitan and statewide transportation planning processes. In 
either case, the MPO or State is responsible for incorporating the 
projects selected from a coordinated plan into the metropolitan and 
statewide transportation plans, TIPs, and STIPs. States with 
coordination programs may wish to incorporate the needs and strategies 
identified in local coordinated plans into statewide coordination 
plans. FTA proposes that, depending upon the structure established by 
local decision-makers, the coordinated planning process may or may not 
become an integral part of the metropolitan or statewide transportation 
planning processes. Regardless of who leads the local coordination 
planning process, FTA encourages a basic level of coordination and 
general consistency between these planning processes.
    Most commenters were in agreement with the cycle and duration of 
the coordinated plan presented in the March 15, 2006, notice. However, 
FTA has revised this section somewhat, and proposes that communities 
and States may update the coordinated plan to align with the 
competitive selection process based on needs identified at the local 
level. This allows communities and States to set up a cycle that is 
conducive to their own planning and competitive selection process.
    Commenters requested clarification about the certification of the 
local planning process. As previously stated, the designated 
recipient's grant application will require documentation of the plan 
from which each project listed is derived, including the lead agency, 
the date of adoption of the plan, or other identifying information.

F. Chapter VI--Program Management and Administrative Requirements

    Chapter VI provides more details for States and direct recipients 
on how to manage the administrative aspects of the three grant 
programs, and is similar for all three programs. FTA notes that Chapter 
VI in the proposed circulars is largely a reorganization of the Program 
Management chapter in the current Section 5310 Circular 9070.1E 
(Chapter V). The proposed chapter starts by noting that the basic grant 
management requirements for State and local governments are contained 
in the U.S. DOT regulations, ``Uniform Administrative Requirements for 
Grants and Cooperative Agreements to State and Local Governments,'' 49 
CFR Part 18, and ``Uniform Administrative Requirements for Grants and 
Agreements with Institutions of Higher Education, Hospitals, and Other 
Non-Profit Organizations,'' 49 CFR Part 19, which are collectively 
referred to as the ``common grant rule.'' Chapter VI provides summary 
information about certain aspects of the common grant rule, and how 
management of those aspects may be applied to these three programs. 
Chapter VI also notes that more detailed information about general 
program and grant management is found in FTA Circular 5010.1C, ``Grant 
Management Guidelines.''
    The common grant rule allows States to use slightly different 
standards for the establishment of equipment management, procurement, 
and financial management systems than are required for other FTA 
recipients. Therefore, throughout Chapter VI, distinctions are made 
between the requirements for States and other designated recipients. In 
addition, the proposed Section 5310 circular has a section on leasing 
vehicles that is specific to that program.
    The general requirements of Chapter VI are common to all FTA 
programs, and FTA received few comments relating to this chapter. One 
commenter noted that there is confusion at the State level as to 
whether non-FTA funded rides ``count'' when determining vehicle use 
tests that allow for vehicle replacement, and whether State, local and 
Federally-funded rides should all be counted toward vehicle 
replacement. In response, FTA notes that useful life standards for 
vehicles are based upon age and mileage, not on the number of rides. 
All transit-related miles count toward the end of life requirement, and 
FTA assumes that all vehicle mileage has been accumulated in transit 
service. Further, FTA notes that States are permitted to establish 
their own useful life standards for vehicle replacement, use their own 
procedures to determine fair market value at the time of disposition, 
and develop their own policies and procedures for maintenance and 
replacement of vehicles.
    Chapter VI describes Reporting Requirements for States and 
designated recipients. FTA is interested in capturing overall program 
measures to be used with the Government Performance Results Act and the 
Performance Assessment Rating Tool process for the U.S. Office of 
Management and Budget (OMB), and so is proposing program measures for 
each program, to be reported annually. These performance measures are 
different for each program.
    FTA received a range of diverse comments relating to performance 
measures. While many commenters noted the importance of measurement, 
evaluation, and oversight, others said that measurements specific to 
performance evaluation should be determined at the local level. The 
Government Performance and Results Act of 1993 requires all Federal 
agencies to develop performance measures for each specific program 
based on Federal program goals and objectives. Therefore, while 
individual communities have the option to include evaluation strategies 
for their own activities, in response to public comment, FTA proposes 
specific performance measures for the Section 5310, JARC, and New 
Freedom programs. We seek comment on these proposals.
    Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501, et 
seq.), Federal agencies must obtain approval from OMB for each 
collection of information they conduct, sponsor, or require through 
regulations. FTA has OMB approval numbers for current data collection 
requirements for JARC and

[[Page 52619]]

Section 5310, however, the data collection requirements could change if 
the performance measures are implemented as drafted in the proposed 
circulars. We invite comments to inform our next submissions to OMB, 
and invite comments on the reporting requirements for New Freedom.

G. Chapter VII--State and Program Management Plans

    FTA requires States and designated recipients responsible for 
implementing the Section 5310, JARC, and New Freedom (and Section 5311) 
programs to document their approach to managing the programs. Chapter 
VII proposes guidance on how to create and use State Management Plans 
(for the State-managed aspects of the programs), and Program Management 
Plans (for designated recipient-managed aspects of the programs). The 
primary purposes of Management Plans are to serve as the basis for FTA 
management reviews of the program, and to provide public information on 
the administration of the programs. FTA notes that Chapter VII in the 
proposed circulars is largely a restatement of the State Management 
Plan chapter in the current Section 5310 Circular 9070.1E (Chapter 
VII). The proposed chapter includes FTA's intention to make designated 
recipients of the JARC and New Freedom programs subject to management 
reviews.
    In all three program circulars, the first two parts of Chapter VII 
explain the general requirements and purpose of Management Plans. The 
third part, ``Reviews,'' differs slightly among the programs. The 
Section 5310 circular discusses only State Management Reviews (as it is 
an entirely State-managed program), while the JARC and New Freedom 
circulars discuss reviews at both the State and designated recipient 
level. The Reviews part of Chapter VII is an addition to the current 
Section 5310 circular.
    The fourth part of Chapter VII discusses the content of Management 
Plans. The suggested content of State and Program Management Plans is 
essentially identical in all three circulars, but the Section 5310 
circular reflects the fact that Section 5310 is entirely State 
administered. Management Plans are to include a section on use of the 
10% of the apportionment available for administration and technical 
assistance, and a description of how the State or designated recipient 
makes additional resources available to local areas.
    The State Management Plan content for Section 5310 remains largely 
as it is written in the current circular. Two sections have been added 
regarding the use of the 10% for administration, planning and technical 
assistance, and transfer of funds, consistent with the sections in the 
new proposed circulars.
    The final part of Chapter VII, which discusses revisions to the 
Management Plan, is the same for all three circulars, and mirrors the 
language in the existing Section 5310 circular.
    FTA received only one comment on Chapter VII material, asking what 
type of oversight will be applied in areas with population under 
200,000. In response, FTA notes that in areas under 200,000 in 
population, the programs are all exclusively State-managed. Therefore, 
the State Management Plan and State Management Review will be used for 
oversight in these areas.

H. Chapter VIII--Other Provisions

    This chapter is an expansion of the current ``Other Provisions'' 
chapter in the existing Section 5310 circular, and is virtually the 
same for all three circulars. Chapter VIII summarizes a number of FTA-
specific and other Federal requirements that FTA grantees are held to 
in addition to the program-specific requirements and guidance provided 
in these circulars. This chapter explains some of the most relevant 
requirements and provides citations to the actual statutory or 
regulatory text. Grantees should use this document in conjunction with 
FTA's ``Master Agreement'' and the current fiscal year ``Certifications 
and Assurances'' to assure that they have met all requirements. 
Grantees may contact FTA Regional Counsel for more detail about these 
requirements.

I. Appendices

    The Appendices sections for the Section 5310, JARC, and New Freedom 
programs are intended as tools for developing a grant application. 
Appendix A specifically addresses steps and instructions for preparing 
a grant application, including pre-application and application stages. 
Appendix A also includes an application checklist and information for 
registering with the Electronic payment system (ECHO). Appendix B 
includes a sample program of projects. For the Section 5310 circular, 
Appendix C provides contact information for FTA's regional offices, and 
Appendix D provides technical assistance information. In the JARC and 
New Freedom circulars, Appendix C includes budget information and 
provides specific activity line item (ALI) codes for specific types of 
eligible costs (i.e., capital, operating, planning, etc.). A sample 
approved budget is included in Appendix D. Appendix E provides contact 
information for each of FTA's 10 regional offices.
    Appendix D in Section 5310 and Appendix F in the JARC and New 
Freedom circulars list potential sources of technical assistance. A 
number of commenters identified a need to have technical assistance 
available to specific types of service providers, including public and 
private transportation providers, MPOs, and human service agencies. 
Commenters also expressed a need for technical assistance and training 
relative to the coordinated planning process. FTA supports a wide range 
of technical assistance and training initiatives that are available to 
service providers and members of the public. Each of the technical 
assistance activities is outlined in Appendix F.

    Issued in Washington, DC, this 30th day of August, 2006.
James S. Simpson,
Administrator.
[FR Doc. E6-14733 Filed 9-5-06; 8:45 am]
BILLING CODE 4910-57-P