[Federal Register Volume 72, Number 188 (Friday, September 28, 2007)]
[Notices]
[Pages 55624-55627]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-19111]



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Part III





Department of Transportation





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Federal Transit Administration



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Capital Investment Program: Proposed Circular; Notice



Program Guidance for Metropolitan Planning Program and State Planning 
and Research Program Grants (49 U.S.C. 5305); Notice of Program 
Guidance



Notice of Proposed Guidance and Request for Comment on the Federal 
Transit Administration's Grant Management Requirements (FTA Circular 
5010.1D); Notice



Third Party Contracting Guidance; Notice of Proposed Program Guidance; 
Proposed Circular; Notice

  Federal Register / Vol. 72, No. 188 / Friday, September 28, 2007 / 
Notices  

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DEPARTMENT OF TRANSPORTATION

Federal Transit Administration

[Docket No. FTA-2007-29123]


Capital Investment Program: Proposed Circular

AGENCY: Federal Transit Administration (FTA), DOT.

ACTION: Notice of availability of proposed circular and request for 
comments.

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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 a circular 
to assist grantees in implementing the Capital Investment Program. The 
Capital Investment Program includes projects such as bus and bus 
facilities, new fixed guideway systems, and fixed guideway 
modernization, as authorized by 49 U.S.C. 5309. By this notice, FTA 
invites public comment on the proposed circular for this program.

DATES: Comments must be submitted by November 27, 2007. Late-filed 
comments will be considered to the extent practicable.

ADDRESSES: You may submit comments identified by the docket number 
[FTA-2007-29123] by any of the following methods:
    1. Web site: www.regulations.gov. Follow the instructions for 
submitting comments on the U.S. Government electronic docket site. 
[Note: The U.S. Department of Transportation's (DOT's) electronic 
docket is no longer accepting electronic comments. All electronic 
submissions must be made to the U.S. Government electronic docket site 
at www.regulations.gov. For mailed and hand-delivered comments, 
commenters should follow the directions below.]
    2. Fax: 202-493-2251.
    3. Mail: U.S. Department of Transportation, 1200 New Jersey Ave., 
SE., Docket Operations, West Building Ground Floor, Room W12-140, 
Washington, DC 20590-0001.
    4. Hand Delivery: U.S. Department of Transportation, 1200 New 
Jersey Ave., SE., Docket Operations, West Building Ground Floor, Room 
W12-140, Washington, DC 20590 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-2007-29123) 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 www.regulations.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).

    Docket: For access to the docket to read background documents and 
comments received, go to www.regulations.gov at any time or to the U.S. 
Department of Transportation, 1200 New Jersey Ave., SE., Docket 
Operations, West Building Ground Floor, Room W12-140, Washington, DC 
20590 between 9 a.m. and 5 p.m., Monday through Friday, except Federal 
holidays.

FOR FURTHER INFORMATION CONTACT: Kimberly Sledge, Office of Program 
Management, Federal Transit Administration, 1200 New Jersey Ave., SE., 
East Building, Fourth Floor, Washington, DC 20590, phone: 202-366-2053, 
fax: 202-366-7951, or e-mail, [email protected]; or Bonnie 
Graves, Office of Chief Counsel, Federal Transit Administration, 1200 
New Jersey Ave., SE., East Building, Fifth Floor, Washington, DC 20590, 
phone: 202-366-0944, fax: 202-366-3809, or e-mail, 
[email protected].

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Overview
II. Chapter-by-Chapter Analysis
    A. Chapter I--Introduction and Background
    B. Chapter II--Program Overview
    C. Chapter III--Buses and Related Acquisitions
    D. Chapter IV--Fixed Guideway Modernization
    E. Chapter V--New Starts Program
    F. Chapter VI--Other Provisions
    G. Appendices

I. Overview

    This notice provides a summary of proposed changes to FTA Circular 
9300.1A, Capital Program: Grant Application Instructions. This program 
was affected by the Safe, Accountable, Flexible, Efficient 
Transportation Equity Act: A Legacy for Users (SAFETEA-LU, Pub. L. 109-
59), signed into law August 10, 2005. FTA is updating the existing 
circular, developed in 1998, to reflect changes in the law. The final 
circular, when adopted, will supersede the existing circular.
    This document does not include the proposed circular; an electronic 
version may be found on FTA's Web site, at http://www.fta.dot.gov. 
Paper copies of the circular may be obtained by contacting FTA's 
Administrative Services Help Desk, at 202-366-4865. FTA seeks comment 
on the proposed circular.
    Readers familiar with the existing FTA Circular 9300.1A will notice 
a number of changes to the proposed circular. For example, we have 
changed the name of the circular to ``Capital Investment Program'' to 
reflect a focus on the capital investment nature of eligible activities 
in 49 U.S.C. 5309 (``Section 5309''), as amended by SAFETEA-LU. In 
addition, we changed the format to make this circular consistent with 
the style of other circulars FTA is updating. At the same time, we have 
tried to maintain some consistency with the previous document; for 
example, information about the Bus program is still in Chapter III, 
Fixed Guideway Modernization continues to be in Chapter IV, with New 
Starts/Small Starts information in Chapter V. Substantive changes in 
content are discussed in the chapter-by-chapter analysis.

II. Chapter-by-Chapter Analysis

A. Chapter I--Introduction and Background

    Chapter I of the proposed circular is an introductory chapter and 
covers general information about FTA and our contact information, 
briefly reviews the authorizing legislation for the Capital Investment 
Program (a.k.a. ``Section 5309 Program''), provides information about 
Grants.gov, includes definitions applicable to the program, and 
provides a brief program history. The Definitions section is new to 
this circular, and includes definitions related to the Section 5309 
program, as well as the Section 5308, Clean Fuels Grant program. Where 
applicable, we have used the same definitions found in rulemakings or 
other circulars to ensure consistency. In the existing circular, 
eligible projects are included in Chapter I. Eligible projects have 
been moved to Chapter II in the proposed circular, and will be 
discussed further there.

B. Chapter II--Program Overview

    Chapter II of the existing circular is titled, ``How to Use This 
Circular.'' The content of this chapter has been eliminated or moved to 
other chapters. Chapter II of the proposed circular provides more 
detail about the Capital Investment program. This chapter starts with 
the statutory authority for the Capital Investment program, followed by 
the goals of the program, and a list of eligible projects. Also 
included in the

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proposed Chapter II is information on apportionment, funds 
availability, Federal/local matching requirements, relationship to 
other FTA programs, and the requirements to ensure a recipient has the 
legal, financial, and technical capacity to carry out a Capital 
Investment project.
    As stated previously, eligible projects have been moved to the 
proposed Chapter II. There were significant changes to eligible 
projects under 49 U.S.C. 5309 with the enactment of SATETEA-LU. Under 
the previous statute (The Transportation Equity Act for the 21st 
Century (TEA-21)), there were eight categories of eligible projects in 
49 U.S.C. 5309. These included bus and bus facilities, new fixed 
guideways, fixed guideway modernization, development of corridors to 
support fixed guideway systems, projects designed to meet the needs of 
elderly and disabled passengers, projects to introduce new technology, 
the capital costs of coordinating public transportation with other 
transportation, and capital projects needed for an efficient and 
coordinated public transportation system. Under SATETEA-LU, there are 
only four categories of eligible projects in 49 U.S.C. 5309: bus and 
bus facilities, new fixed guideways, fixed guideway modernization, and 
corridor improvements. Therefore, the list of eligible projects in the 
proposed circular has changed, as well. We have defined the four 
categories of eligible projects as ``capital investment projects'' and 
listed them in this proposed chapter as ``assets for which FTA provides 
assistance.'' In addition to these ``capital investment projects,'' 
however, we have included a list of projects that, ``when integral to a 
capital investment project,'' would be eligible for Section 5309 
funding. This includes the introduction of new technology, previously 
eligible under TEA-21. While not specifically listed as an eligible 
project, bus purchases to meet the needs of elderly persons and persons 
with disabilities would be eligible, since bus purchases generally are 
eligible. We note that the purpose of the Section 5310 Program is to 
purchase buses to meet the special transportation needs of these 
populations, and Section 5310 funding is available to private non-
profit organizations where public transportation is unavailable, 
insufficient, or inappropriate.
    In keeping with the purpose of Section 5309 as a capital 
``investment'' program, we propose removing two previously eligible 
projects from the proposed circular: The capital cost of contracting 
and preventive maintenance for the bus program. Both of these capital 
expenditures are eligible for funding under other FTA programs, 
including the Urbanized Area Formula program (Section 5307) and the 
Nonurbanized Area Formula program (Section 5311). The capital cost of 
contracting allows recipients to fund the capital portion of contracts, 
thus acquiring the use of capital assets for the short-term. The 
purpose of the Section 5309 program is long-term investment, and the 
purchase of assets for short-term use is not consistent with the 
program's purpose. ``Capital projects'' are defined in 49 U.S.C. 5302, 
and preventive maintenance is included in that definition. Sections 
5307 and 5311 broadly permit the Secretary to make grants for capital 
projects (e.g., ``the Secretary may make grants for capital 
projects''). Under Section 5309, however, capital projects are more 
narrowly defined, and in the bus program, the Secretary is permitted to 
make grants for ``capital projects to replace, rehabilitate, and 
purchase buses and related equipment.'' In light of Congress' generally 
limiting the list of Section 5309 eligible projects to those with an 
``investment'' purpose, FTA proposes similarly limiting the bus program 
to projects that provide an investment in future transportation, and 
removing preventive maintenance since it does not fall within the 
statutory eligibility of ``capital projects to replace, rehabilitate, 
and purchase buses.'' Bus-related equipment remains an eligible 
project. FTA seeks comment on the proposed list of eligible projects.
    The Federal/local matching requirements, found in Chapter I of the 
existing circular and Chapter II of the proposed circular, are 
consistent with 49 U.S.C. Chapter 53; namely, the Federal share is 80 
percent of an eligible project unless the applicant requests a lower 
percentage. Exceptions include Clean Air Act (CAA), Americans with 
Disabilities Act (ADA), and bicycle projects, all of which have a 90 
percent Federal share.
    In 1992, under the provision allowing the Secretary ``to determine 
through practicable administrative procedures, the costs attributable 
to compliance with those Acts,'' FTA computed an 83 percent composite 
Federal match for bus or van related equipment, which reflects a blend 
of 80 percent for the bus or van and 90 percent for the incremental 
cost of equipment added to the bus or van and associated with CAA and 
ADA compliance. For all other vehicles, including rail vehicles, a 
detailed accounting of the incremental cost required for CAA and ADA 
compliance must be provided in the grant application to determine the 
Federal share.
    Beginning with Fiscal Year 2006, recipients may apply for a 90 
percent share of the actual incremental costs of vehicle-related 
facility improvements related to ADA or CAA compliance. FTA is 
requesting that recipients provide documentation supporting these 
requests. The 83 percent Federal share does not apply to facilities, 
for which the costs are more variable. The eligibility of facility-
related cost elements at the 90 percent share will be reviewed on a 
case-by-case basis as part of the grant application process. FTA seeks 
comment on this proposal.
    Finally, the proposed Chapter II includes information on how a 
recipient demonstrates that it has the legal, financial, and technical 
capacity required to carry out a Capital Investment project. This 
information is found in Chapter VI of the existing circular, and FTA 
did not substantively change the language of this section.

C. Chapter III--Buses and Related Acquisitions

    Chapter III addresses buses and related acquisitions, commonly 
known as ``the bus program.'' The information in the proposed circular 
compares to information found in Chapter III of the existing circular, 
and the proposed Chapter III has been completely reworked, while 
retaining much of the information in the existing circular. The 
proposed circular contains information on how funds are allocated, 
examples of eligible projects, environmental considerations, 
requirements related to vehicles, equipment, and facilities, and the 
Clean Fuels Grant program. Information in the existing circular that 
was not retained in the proposed circular includes the following: 
information about other programs available for funding buses and bus-
related facilities (some of this information is retained in the 
proposed Chapter II--Relationship to Other FTA Programs); the lead time 
needed for purchasing new buses; and an expected time frame for a bus 
facilities project. FTA removed the lead time and time frame as they 
were at best speculative in nature. Further, individuals or agencies 
seeking Section 5309 funds generally understand the lead time and time 
frames involved in these projects, and FTA regional office staff can 
assist interested parties in determining how long a particular project 
will take.
    Language from the existing Chapter III that was retained in the 
proposed Chapter III remains largely unchanged, with some exceptions to 
bring the circular up to date with changes in the

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law. For example, 49 U.S.C. 5323(m) was amended so rolling stock 
procurements of 20 vehicles or fewer for use in areas under 200,000 
population are not required to have an inspector on-site; this is 
reflected in paragraph 6(c)(3) in the proposed circular. Paragraph 
6(a)(2) states the current status of the charter rule, and notes that 
the paragraph may change if a final charter rule is published before 
the final FTA Circular 9300 is issued. In addition, paragraph 6(d) 
reflects passage of the Presidential Coin Act of 2005, requiring that 
as of January 1, 2008, all transit systems that receive Federal funding 
shall be capable of accepting and dispensing $1 coins.
    Since Section 5309 bus funds may be used to purchase buses that use 
clean fuels, the proposed Chapter III contains a paragraph on the 
Section 5308 Clean Fuels Grant program. This section of the chapter 
describes the purpose of the program, and, in the event Congress 
appropriates funds under Section 5308, describes eligible recipients, 
eligible projects, funds availability, and Federal share. We note also 
that FTA has promulgated a final rule for the Clean Fuels Grant program 
at 49 CFR part 624 (72 FR 15049, March 30, 2007).

D. Chapter IV--Fixed Guideway Modernization

    Chapter IV addresses fixed guideway modernization. The information 
in the proposed circular compares to information found in Chapter IV of 
the existing circular, with only minor changes. For example, paragraph 
6(c) Clean Air Act Compliance has been updated. Further, as in the bus 
chapter, the change in 49 U.S.C. 5323(m) to forgo on-site inspections 
for rolling stock procurements of 20 vehicles or fewer for use in areas 
under 200,000 population is reflected in paragraph 6(e). The Buy 
America requirement was updated in paragraph 6(g), as was the Major 
Capital Project paragraph 6(h).

E. Chapter V--New Starts

    The proposed Chapter V addresses New Starts, and compares to 
information found in Chapter V of the existing circular. In addition to 
the information found in Chapter V of the proposed circular, FTA 
maintains a New Starts Web page, at http://www.fta.dot.gov/planning/planning_environment_5221.html that contains the most up-to-date 
guidance for this program. In addition, there is a New Starts rule, 
found at 49 CFR part 611, and FTA published a notice of proposed 
rulemaking in the Federal Register (72 FR 43328, Aug. 3, 2007), which 
proposes a number of changes to the current rule. Interested readers 
are encouraged to review the proposed rule at http://a257.g.akamaitech.net/7/257/2422/01jan20071800/edocket.access.gpo.gov/2007/pdf/E7-14285.pdf.
    The format of the proposed Chapter V remains similar to that of the 
existing circular, and FTA proposes several changes to this chapter, 
largely due to changes in the law. For example, FTA draws a distinction 
between a ``New Start''--a project that has a total cost of $250 
million or more, or for which the project sponsor is requesting more 
than $75 million in Federal funds; and a ``Small Start''--a project 
that has a total cost of less than $250 million that requests less than 
$75 million in Federal funds. The various requirements for both 
projects are described throughout the chapter. There is a new phase in 
the project development process--alternatives analysis--which is 
described at length.
    The sections on Environmental Protection, Clean Air Act Compliance, 
Available Funding, Project Management Plan, and Value Engineering 
Requirements contain only minor edits. The section titled, ``FTA Rating 
System'' has been enhanced for greater clarification of how FTA rates 
projects. Readers are encouraged also to review FTA's recently 
published, ``Proposed Policy Guidance on Evaluation Measures for New 
Starts/Small Starts,'' available on the FTA Web site at  http://www.fta.dot.gov/documents/NPRM_Policy_Guidance_7-18-07_v_3.doc. A 
Federal Register notice (72 FR 43378, Aug. 3, 2007) accompanied 
publication of the proposed policy guidance.

F. Chapter VI--Other Provisions

    This chapter is similar to the ``Other Provisions'' chapters in 
other FTA circulars, and 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 the circular. 
The proposed chapter compares to the information found in the existing 
Chapter VI, ``Requirements Common to All Capital Program Grant 
Applications.'' Much of the information has been retained and 
reorganized. As mentioned, the sections on legal, financial, and 
technical capacity in the existing Chapter VI have been moved to the 
proposed Chapter II. In addition, the ``Relationship to Other 
Programs'' sections in the existing Chapter VI have been moved to the 
proposed Chapter II. Recipients should use this chapter in conjunction 
with FTA's ``Master Agreement'' and the current fiscal year 
``Certifications and Assurances'' to assure that they have met all 
requirements. Recipients may contact FTA Regional Counsel for 
additional information about these requirements.

G. Appendices

    The proposed appendices 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. This information is comparable to 
Chapter VII, Grant Application Contents, in the existing circular, 
although it has been updated and reorganized. Appendix A also includes 
an application checklist and information for registering with the 
Electronic Clearing House Operation (ECHO) payment system. Proposed 
Appendix B provides budget information, including a sample budget, and 
compares with the information found in Chapter VIII, Instructions for 
Preparing a Project Budget, in the existing circular. Proposed Appendix 
C, which compares with Chapter IX, Examples, in the existing circular, 
contains samples of an Authorizing Resolution, a Transaction for Mid-
life Sale of a Transit Bus, an Opinion of Counsel, a Project Milestone 
Schedule, and Proceeds from the Sale of Assets. Proposed Appendix D 
contains contact information for all of FTA's regional and metropolitan 
offices, and is new information for this circular.
    We propose removing the existing Appendix A, Relationship Between 
Capital Program Grants and the Metropolitan and Statewide Planning 
Process; Appendix B, Joint Development Projects; and Appendix C, Annual 
Certifications and Assurances. Readers will find information on 
planning requirements throughout the proposed circular, and the 
information on Certifications and Assurances has been consolidated into 
one paragraph in Chapter VI. Historically, FTA has included guidance on 
Joint Development in three circulars: 5010.1, Grants Management; 
9030.1, Formula Capital Grants; and 9300.1, Major Capital Investments. 
However, FTA issued separate Joint Development guidance in a Federal 
Register notice (72 FR 5788, Feb. 7, 2007) and, as FTA stated in that 
notice, we have decided to consolidate the appendices in FTA Circulars 
5010.1, 9030.1, and 9300.1 into one circular on the eligibility of 
joint development improvements. This circular is scheduled for 
publication in 2008, but until it is published, readers should refer to 
the Federal Register

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notice for guidance on joint development projects.

    Issued in Washington, DC, this 24th day of September, 2007.
James S. Simpson,
Administrator.
 [FR Doc. E7-19111 Filed 9-27-07; 8:45 am]
BILLING CODE 4910-57-P