[Federal Register Volume 71, Number 220 (Wednesday, November 15, 2006)]
[Rules and Regulations]
[Pages 66450-66454]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-19240]


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DEPARTMENT OF TRANSPORTATION

Federal Highway Administration

23 CFR Part 635

[FHWA Docket No. FHWA-2006-23552]
RIN 2125-AF18


Construction and Maintenance

AGENCY: Federal Highway Administration (FHWA), DOT.

ACTION: Final rule.

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SUMMARY: The FHWA is revising its regulations in 23 CFR part 635 
subpart D to address Section 5514 of the Safe, Accountable, Flexible, 
Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU). 
This law requires the FHWA to ensure that States provide for 
competition with respect to the specification of alternative types of 
culvert pipes. These revisions will ensure that States provide for 
competition in the specification of alternative types of culvert pipes.

DATES: Effective Date: December 15, 2006.

FOR FURTHER INFORMATION CONTACT: For technical information: Mr. Gerald 
Yakowenko, Office of Program Administration (HIPA), (202) 366-1562. For 
legal information: Mr. Michael Harkins, Office of the Chief Counsel 
(HCC-30), (202) 366-4928, Federal Highway Administration, 400 Seventh 
Street, SW., Washington, DC 20590. Office hours are from 7:45 a.m. to 
4:15 p.m., e.t., Monday through Friday, except Federal holidays.

SUPPLEMENTARY INFORMATION: 

Electronic Access

    This document and all comments received by the U.S. DOT Dockets, 
Room PL-401, may be viewed through the Docket Management System (DMS) 
at http://dms.dot.gov. It is available 24 hours each day, 365 days each 
year. Electronic submission and retrieval help and guidelines are 
available under the help section of this Web site.
    An electronic copy of this document may be downloaded from the 
Federal Register's home page at http://www.archives.gov and the 
Government Printing Office's Web page at http://www.access.gpo.gov/nara.

Background

    Section 5514 of the SAFETEA-LU (Pub. L. 109-59; Aug. 10, 2005), 
titled ``Competition for Specification of Alternative Types of Culvert 
Pipes,'' requires the Secretary of Transportation to ensure that States 
provide for competition with respect to the

[[Page 66451]]

specification of alternative types of culvert pipes through 
requirements that are commensurate with competition requirements for 
other construction materials.
    The FHWA's policies in 23 CFR part 635 subpart D--General Material 
Requirements support the competitive bidding principles in Section 112 
of Title 23 U.S. Code by providing for the broadest consideration of 
materials to encourage competition. Where alternative products are 
judged to be of satisfactory quality and equally acceptable on the 
basis of engineering and economic analysis, the FHWA requires equal 
consideration in the specification of materials.

Notice of Proposed Rulemaking (NPRM)

    The FHWA published a NPRM on April 17, 2006, at 71 FR 19667. We 
proposed to delete 23 CFR 635.411, paragraph (d) and re-designate 
paragraphs (e) and (f) as (d) and (e) respectively. We also proposed to 
delete Appendix A to subpart D--``Summary of Acceptable Criteria for 
Specifying Types of Culvert Pipes'' in its entirety.
    Appendix A to subpart D of 23 CFR part 635 was officially included 
in the FHWA's regulations on September 30, 1974. Appendix A contained 
the requirements concerning the specification, number and types of 
culvert pipes specified on Federal-aid highway construction projects. 
These requirements were intended to encourage competition and lower the 
cost of culvert pipes by encouraging the consideration of alternate 
culvert pipe materials in certain drainage installations.
    When Appendix A was codified in 1974, the universe of available 
culvert materials was very limited and the State DOT's experience with 
new culvert materials was equally limited. From a practical viewpoint, 
the culvert materials market consisted of two materials--reinforced 
concrete pipe and corrugated steel pipe (either plain galvanized or 
asphalt coated). At that time, the State DOTs were also limited by 
existing national materials specifications for these materials and it 
was difficult for new culvert manufacturers to enter the public 
transportation construction marketplace. Over the next thirty years, 
the competitive market changed significantly and American Association 
of State Highway and Transportation Officials (AASHTO) materials 
specifications are now available for various culvert materials such as: 
acrylonitrile butadiene styrene pipe, reinforced concrete pipe, 
corrugated aluminum pipe, corrugated steel pipe (with coatings of zinc, 
aluminum, asphalt or polymers), poly-vinyl chloride pipe and high-
density polyethylene pipe.
    In order to implement the provisions of section 5514 of SAFETEA-LU 
and be consistent with the long-standing policy of ensuring the 
consideration of the largest number of appropriate alternatives that 
lead to the lowest overall life cycle cost, the FHWA proposed to delete 
Appendix A to subpart D of 23 CFR part 635. The deletion of Appendix A 
will eliminate the specific requirement for the consideration of 
alternative types of culverts for certain drainage installations. By 
doing so, the selection and specification of culvert types will be 
governed by the same regulatory policy for all other materials in 23 
CFR 635.411, thus ensuring competition in the selection of pipes.

Summary Discussion of Comments Received in Response to the NPRM

    The following discussion provides an overview of the comments 
received in response to the NPRM, and the FHWA's actions to resolve and 
address the issues raised by the respondents.

Profile of Respondents

    We received responses from twenty-three entities. The respondents 
included: three State (DOTs), four associations, three consulting 
engineering firms, three firms involved with the manufacturing of 
culverts, and ten individuals. The four associations included: Uni-Bell 
PVC Pipe Association, the Plastic Pipe Institute, the American Concrete 
Pipe Association and the National Corrugated Steel Pipe Association. We 
classified the American Association of State Highway and Transportation 
Officials (AASHTO) as a State DOT because they represent State DOT 
interests. The AASHTO provided a consolidated response to the NPRM on 
behalf of its member States. Two State DOTs also provided their 
comments individually.

Analysis of NPRM Comments and FHWA Response

    Fourteen commenters expressed support for the proposed changes in 
the NPRM. No commenter objected to the proposed changes in the NPRM. 
Nine commenters did not approve or disapprove of the proposed changes, 
but provided commentary for consideration in drafting the final rule.

Supporting the Need for Change

    Nine commenters including: Chevron Philips Chemical Company LP, 
Advanced Drainage Systems, Inc., the Plastic Pipe Institute, ExxonMobil 
Chemical Company, Mr. Daniel J. Kuroter, Mr. Andrew P. Thomas, Clough 
Harbour & Associates LLP, Honorable Deborah Pryce and Jim Goddard 
stated that Appendix A to subpart D is outdated and does not reflect 
the realities in today's highly competitive culvert marketplace.
    We agree with this concern. The availability of different culvert 
materials and the State DOTs' experience with these materials has 
changed significantly since Appendix A was codified in 1974. This is 
one of the reasons why we elected to delete Appendix A. It is no longer 
necessary to have an FHWA requirement concerning the minimum number of 
alternative culvert specifications that are necessary for certain 
drainage installations.
    Many respondents expressed concerns regarding interpretations of 
Appendix A that have limited competition. The ADR and Associates and 
Mr. Andy Beard stated that some contracting agency interpretations of 
Appendix A led to non-competitive situations--exactly the opposite of 
what the FHWA intended. They indicated that such interpretations stifle 
competition by allowing highway project managers to ignore the wide 
range of culvert alternatives that currently exist.
    Mr. Daniel J. Kuroter, Mr. Andrew P. Thomas, and Clough Harbour & 
Associates LLP stated that the current regulations do not promote 
competition and are too frequently interpreted in ways that restrict 
competition. Advanced Drainage Systems, Inc. indicated that they have 
encountered certain States that routinely and arbitrarily restricted 
competition in the selection of drainage products.
    Mr. John Owen Hurd and Jim Goddard stated that Appendix A has 
allowed contracting agencies to circumvent the intent of the rules to 
encourage competition and specify only one pipe material if they so 
choose.
    We appreciate the concerns of these respondents in asserting that 
some contracting agencies may have used Appendix A as an excuse for not 
fully considering all reasonable culvert alternatives. With the 
deletion of Appendix A, contracting agencies will no longer be able to 
cite Appendix A as their basis for not considering other culvert 
alternatives.
    Other respondents suggested that the FHWA consider a revision, 
rather than a deletion of Appendix A. Honorable Deborah Pryce 
recommended that consideration be given to revising Appendix A to 
clarify the types and

[[Page 66452]]

numbers of alternative products that are required for consideration in 
various drainage applications. Advanced Drainage Systems, Inc. and the 
Plastic Pipe Institute stated that a proper revision of Appendix A 
might have been more effective in requiring competition; however, they 
recognized that the proposed deletion of Appendix A could accomplish 
the same goal as long as it is properly enforced at the State level.
    We considered a revision rather than a deletion of Appendix A but 
elected not to do so for two reasons. First, Section 5514 requires the 
Secretary to ``* * * ensure that States provide for competition with 
respect to the specification of alternative types of culvert pipes 
through requirements that are commensurate with competition 
requirements for other construction materials, as determined by the 
Secretary.'' The FHWA does not have a specific policy requiring the 
specification, number and types of alternative materials for any other 
highway construction material. In all other areas of highway material 
specification, the contracting agency has the responsibility to 
consider all alternative products that are judged to be of satisfactory 
quality and equally acceptable on the basis of engineering and economic 
analyses. Thus, it is important to treat culvert materials the same as 
other materials by removing Appendix A. Second, the culvert materials 
industry is a highly competitive market and it would not be appropriate 
to limit the consideration of alternative materials through a revision 
of Appendix A.
    Many of the respondents recommended that the FHWA take additional 
enforcement and compliance actions to ensure real competition. The ADR 
and Associates and Mr. Andy Beard recommend that we take additional 
enforcement steps to ensure that the final rule results in the 
promotion of real competition. Advanced Drainage Systems, Inc. and the 
Plastic Pipe Institute recommended that the FHWA provide appropriate 
communications and enforcement actions if it is to meet the intent of 
Congress. Other commenters such as Chevron Philips Chemical Company LP, 
ADR and Associates, Mr. Andy Beard, ExxonMobil Chemical Company, Mr. 
Daniel J. Kuroter, Mr. Andrew P. Thomas, Clough Harbour & Associates 
LLP and Jim Goddard suggested that FHWA utilize appropriate incentives 
and penalties to ensure compliance.
    We recognize the concerns of these respondents who believe that 
culvert material competition has been limited in certain segments of 
the Federal-aid program. While the FHWA does not have the legal 
authority to utilize incentives to the States for enforcement purposes, 
the FHWA does have the authority to impose penalties if the FHWA 
determines that a State is not complying with Federal requirements. 
Pursuant to 23 CFR 1.36, the FHWA may withhold payment on a particular 
project, withhold approval of further projects, and take any other 
action the FHWA may deem appropriate. The FHWA will continue to 
exercise appropriate oversight over all Federal requirements and work 
with the States to ensure that these requirements are met.

Maintaining the Status Quo

    Generally speaking, the AASHTO, two State DOT representatives and 
Ms. Lesly Tribelhorn were concerned that the final rule may require 
States to change their current State practices, thus limiting the 
flexibility they now have for culvert material selection.
    The AASHTO agreed that the proposed deletion of Appendix A will 
eliminate specific requirements for the consideration of alternative 
types of culverts for certain drainage installations, thus making the 
selection of culvert materials subject to the same FHWA regulations as 
the selection of all other materials. The AASHTO believed that this 
would provide flexibility and allow for the application of engineering 
judgment in selection and design of drainage facilities. However, 
AASHTO noted that the proposed change failed to recognize the 
complexities associated with the analysis, design, detailing and 
bidding of multiple culvert type specifications.
    The State of Rhode Island currently restricts the use of high-
density polyethylene (HDPE) pipe to a maximum culvert diameter of 24 
inches. The Rhode Island representative was concerned that the proposed 
changes would require a revision of its culvert material selection 
policy to consider the use of HDPE pipes for culvert installations 
greater than 24 inches. Similarly, a representative from the Iowa DOT 
indicated that it was not opposed to the proposed rule, however, it did 
not want the final rule to limit or restrict the State's ability to 
specify certain pipe materials in specific drainage installations.
    Ms. Tribelhorn stated that there is a need to allow the States to 
use engineering judgment in the culvert selection process and 
contracting agencies should be allowed to use specific selection 
criteria without the FHWA requiring pipe alternatives in the bidding 
process. Ms. Tribelhorn questioned whether the deletion of Appendix A 
would allow for this flexibility.
    With the deletion of Appendix A, the FHWA's material selection 
policy will require the States to consider all available materials or 
products that are judged to be of satisfactory quality and equally 
acceptable on the basis of engineering and economic analyses. Where 
such products appear to be equal, alternative bidding practices must be 
used as required by 23 CFR 635.411(b). Where alternative products are 
determined to have different engineering and economic properties, 
contracting agencies may select a specific material or product based on 
life cycle cost criteria. In such cases, the contracting agency should 
document its material selection decision on a project or program basis 
as appropriate.
    The AASHTO further stated that it is often necessary to specify a 
certain type of culvert on higher functional classification roadways 
where major disruptions of traffic would occur if repairs or 
replacements were needed. The AASHTO stated that existing Appendix A to 
Subpart D provided the authority to do this. It raised the concern that 
the proposed deletion of Appendix A would result in the States having 
to justify and seek FHWA's approval for such installations.
    We disagree that the proposed change would result in additional 
work for the contracting agency (assuming that the agency is currently 
complying with the FHWA policy).
    The AASHTO recommended that the FHWA insert the following language 
in 23 CFR 635.411(b), at the end of the second sentence--``This 
provision is not intended to displace the owner's or their Professional 
Engineers responsibility to determine acceptable materials based on 
local performance history or owner's policies on material use.'' It 
appears that the intent of this recommendation is to give the 
contracting agency the discretion to waive the requirement for 
alternate material bidding of equally acceptable products for various 
reasons.
    Mr. Jim Goddard commented that AASHTO's recommendation was written 
to permit those agencies still using single source, non-competitive 
standards to maintain the status quo. Mr. John Owen Hurd stated that 
AASHTO's recommendation would completely emasculate the intent of the 
proposed changes, permitting arbitrary selection of only one type of 
pipe material.
    We disagree with the recommendation proposed by AASHTO. The 
existing provisions in 23 CFR part 411 provides contracting agencies 
with

[[Page 66453]]

sufficient flexibility to select materials or products that are of 
satisfactory quality and equally acceptable on the basis of engineering 
and economic analyses.

Other Comments

    The National Corrugated Steel Pipe Association (NCSPA) noted its 
support for the intent of Section 5514 of SAFETEA-LU but provided 
specific recommendations regarding culvert type selection procedures. 
The NCSPA recommend that the FHWA require contracting agencies to set 
acceptable service life requirements and provide economic analyses of 
the alternates based on those requirements. The NCSPA believes that 
very few State DOT specifications have a service life requirement and 
the design methodology to adequately determine service life for all 
culvert alternatives in the varying environments. Furthermore, the 
NCSPA stated that under the current policy, the FHWA cannot be assured 
of proper life cycle cost analysis from each State DOT unless that 
State has specific service life requirements.
    We agree with the intent of the comment; however, this topic is not 
appropriate for inclusion in this regulation. It would be more 
appropriate to address this issue in an AASHTO guide specification or 
AASHTO guideline as is currently done for other highway materials.
    The American Concrete Pipe Association supported the proposed 
language in the NPRM, but recommended a revision to the first sentence 
in 23 CFR 635.411(b) to read as follows: ``When there is available for 
purchase more than one nonpatented, nonproprietary material, 
semifinished or finished article or product that will fulfill the 
requirements for an item of work of a project and these available 
materials or products are proven to be of equal quality and material 
service life, perform the intended engineering function during the 
design life of the project, and equally acceptable on the basis of an 
engineering analysis and a present worth life cycle cost analysis, the 
PS&E for the project shall either contain or include by reference the 
specifications for each such material or product that is considered 
acceptable for incorporation in the work.''
    This revision would place more emphasis on life cycle costs rather 
than initial costs. We agree with the intent of this recommendation; 
however, we do not believe that the revision is necessary as 
contracting agencies already consider life cycle cost considerations in 
determining which materials are equally acceptable.

Rulemaking Analyses and Notices

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

    The FHWA has determined that this final rule is not a significant 
regulatory action within the meaning of Executive Order 12866 or 
significant within the meaning of Department of Transportation 
regulatory policies and procedures. We anticipate that the economic 
impact of this rulemaking will be minimal. These changes to the FHWA's 
Material or Product Selection policies are minor in nature. The 
deletion of Appendix A to subpart D of 23 CFR part 635 eliminates the 
specific requirement for the consideration of alternative types of 
culverts for certain drainage installations. Culvert pipes will be 
subject to the same selection policies as all other highway materials 
and products. This final rule will not adversely affect, in a material 
way, any sector of the economy. In addition, these changes will not 
interfere with any action taken or planned by another agency and will 
not materially alter the budgetary impact of any entitlements, grants, 
user fees, or loan programs.

Regulatory Flexibility Act

    In compliance with the Regulatory Flexibility Act (Pub. L. 96-354, 
5 U.S.C. 601-612) the FHWA has evaluated the effects of this final rule 
on small entities and has determined that the action will not have a 
significant economic impact on a substantial number of small entities. 
This final rule addresses material selection for States. As such, it 
affects only States and States are not included in the definition of 
small entity set forth in 5 U.S.C. 601. Therefore, the Regulatory 
Flexibility Act does not apply and the FHWA certifies that this action 
will not have a significant economic impact on a substantial number of 
small entities.

Unfunded Mandates Reform Act of 1995

    This final rule does not impose unfunded mandates as defined by the 
Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4, March 22, 1995, 
109 Stat. 48). This rule will not result in the expenditure by State, 
local, and tribal governments, in the aggregate, or by the private 
sector, of $128.1 million or more in any one year. Additionally, the 
definition of ``Federal Mandate'' in the Unfunded Mandates Act excludes 
financial assistance of the type in which State, local, or tribal 
governments have authority to adjust their participation in the program 
in accordance with changes made in the program by the Federal 
government. The Federal-aid highway program permits this type of 
flexibility.

Executive Order 13132 (Federalism)

    This final rule has been analyzed in accordance with the principles 
and criteria contained in Executive Order 13132, and the FHWA has 
determined that this action does not have sufficient federalism 
implications to warrant the preparation of a federalism assessment. The 
FHWA has also determined that this action does not preempt any State 
law or State regulation or affect the States' ability to discharge 
traditional State governmental functions.

Executive Order 12372 (Intergovernmental Review)

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

Paperwork Reduction Act

    This action does not contain a collection of information 
requirement under the Paperwork Reduction Act of 1995, 44 U.S.C. 3501-
3520.

National Environmental Policy Act

    The FHWA has analyzed this final rule for the purpose of the 
National Environmental Policy Act of 1969 (42 U.S.C. 4321-4347) and has 
determined that this action will not have any effect on the quality of 
the environment.

Executive Order 12630 (Taking of Private Property)

    This action will not affect the taking of private property or 
otherwise have taking implications under Executive Order 12630, 
Government Actions and Interface with Constitutionally Protected 
Property Rights.

Executive Order 12988 (Civil Justice Reform)

    This action meets applicable standards in sections 3(a) and 3(b)(2) 
of Executive Order 12988, Civil Justice Reform, to minimize litigation, 
eliminate ambiguity, and reduce burden.

Executive Order 13045 (Protection of Children)

    We have analyzed this final rule under Executive Order 13045, 
Protection of Children from Environmental Health Risks and Safety 
Risks. The FHWA certifies that this action will not cause an 
environmental risk to health or safety that might disproportionately 
affect children.

[[Page 66454]]

Executive Order 13175 (Tribal Consultation)

    The FHWA has analyzed this final rule under Executive Order 13175, 
dated November 6, 2000, and believes that this action will not have 
substantial direct effects on one or more Indian tribes; will not 
impose substantial direct compliance costs on Indian tribal 
governments; and will not preempt tribal laws. This final action 
addresses material selection by the States for Federal-aid highway 
projects and will not impose any direct compliance requirements on 
Indian tribal governments. Therefore, a tribal summary impact statement 
is not required.

Executive Order 13211 (Energy Effects)

    We have analyzed this action under Executive Order 13211, Actions 
Concerning Regulations That Significantly Affect Energy Supply, 
Distribution, or Use Dated May 18, 2001. We have determined that it is 
not a significant energy action under that order because it is not a 
significant regulatory action under Executive Order 12866 and it is not 
likely to have a significant adverse effect on the supply, 
distribution, or use of energy. Therefore, a Statement of Energy 
Effects is not required.

Regulation Identification Number

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

List of Subjects in 23 CFR Part 635

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

    Issued on: November 7, 2006.
J. Richard Capka,
Federal Highway Administrator.

0
In consideration of the foregoing, the FHWA proposes to amend part 635 
of title 23, Code of Federal Regulations, as follows:

PART 635--CONSTRUCTION AND MAINTENANCE

0
1. Revise the authority citation for part 635 to read as follows:

    Authority: Sec. 5514 of Pub. L. 109-59, 119 Stat. 1144; 23 
U.S.C. 101 (note), 109, 112, 113, 114, 116, 119, 128, and 315; 31 
U.S.C. 6505; 42 U.S.C. 3334, 4601 et seq.; Sec. 1041(a), Pub. L. 
102-240, 105 Stat. 1914; 23 CFR 1.32; 49 CFR 1.48(b).


Sec.  635.411  [Amended]

0
2. Amend Sec.  635.411 by removing paragraph (d) and redesignating 
paragraphs (e) and (f) as (d) and (e) respectively.

Appendix A to Subpart D [Removed]

0
3. Amend 23 CFR part 635, subpart D by removing Appendix A to Subpart 
D.

 [FR Doc. E6-19240 Filed 11-14-06; 8:45 am]
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