[Federal Register Volume 78, Number 77 (Monday, April 22, 2013)]
[Notices]
[Pages 23818-23822]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-09333]


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DEPARTMENT OF TRANSPORTATION

Federal Transit Administration

[Docket No. FTA- 2013-0010]


Urbanized Area Formula 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 recipients in their implementation of the section 
5307 Urbanized Area Formula Program. The purpose of this proposed 
circular is to provide recipients of FTA financial assistance with 
instructions and guidance on program administration and the grant 
application process. The proposed revisions to the existing circular 
are a result of changes made to the Urbanized Area Formula Program by 
the Moving Ahead for Progress in the 21st Century Act. By this notice, 
FTA invites public comment on the proposed circular.

DATES: Comments must be submitted by June 21, 2013. Late-filed comments 
will be considered to the extent practicable.

ADDRESSES: You may submit comments identified by the docket number FTA-
2013-0010 by any of the following methods:
     Federal eRulemaking Portal: Submit electronic comments and 
other data to http://www.regulations.gov.
     U.S. Mail: Send comments to Docket Operations; U.S. 
Department of Transportation, 1200 New Jersey Avenue SE., West Building 
Room W12-140, Washington, DC 20590-0001.
     Hand Delivery or Courier: Take comments to Docket 
Operations in Room W12-140 of the West Building, Ground Floor, at 1200 
New Jersey Avenue SE., Washington, DC, between 9:00 a.m. and 5:00 p.m., 
Monday through Friday, except Federal holidays.
     Fax: Fax comments to Docket Operations, U.S. Department of 
Transportation, at (202) 493-2251.
    Instructions: The agency name (Federal Transit Administration) and 
Docket Number (FTA-2013-0010) must be included at the beginning of each 
submission. If sent by mail, please submit two copies. Due to security 
procedures in effect since October 2001, mail received through the U.S. 
Postal Service may be subject to delays. Parties mailing comments 
should consider using an express mail firm to ensure their prompt 
filing. If you wish to receive confirmation that FTA received your 
comments, you must include a self-addressed stamped postcard. All 
comments received will be posted without change to http://www.regulations.gov, including any personal information provided. You 
may review USDOT's complete Privacy Act Statement published in the 
Federal Register on April 11, 2000, at 65 FR 19477-8 or http://DocketsInfo.dot.gov.

FOR FURTHER INFORMATION CONTACT: For program matters, Adam Schildge, 
Office of Project Management, (202) 366-0778 or [email protected]. 
For legal matters, Rita Maristch, Office of Chief Counsel, (215) 656-
7249 or [email protected]. Office hours are from 8:30 a.m. to 5:00 
p.m., Monday through Friday, except Federal holidays.

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--General Program Information
    D. Chapter IV--Eligible Projects and Requirements
    E. Chapter V--Planning and Program Development
    F. Chapter VI--Program Management and Administrative 
Requirements
    G. Chapter VII--Other Provisions
    H. Tables, Graphs, and Illustrations
    I. Appendices

I. Overview

    This notice provides a summary of proposed changes to FTA Circular 
9030.1D, Urbanized Area Formula Program: Program Guidance and 
Application Instructions. The section 5307 Urbanized Area Formula 
Program authorizes Federal financial assistance for public 
transportation in urbanized areas for capital and planning projects, 
job access and reverse commute projects, and, in some cases, operating 
assistance. This program was affected by the Moving Ahead for Progress 
in the 21st Century Act (MAP-21, Pub. L. 112-141), signed into law on 
July 6, 2012. FTA is updating the existing circular, 9030. 1D, 
published on May 10, 2010, to reflect changes in the law.
    MAP-21 made several significant changes to Federal transit laws 
that are applicable across all of FTA's financial assistance programs 
and reflected in the proposed circular. These changes further several 
important goals of the Department of Transportation (DOT). Most 
notably, MAP-21 grants FTA significant new authority to oversee and 
regulate the safety of public transportation systems throughout the 
United States. The Act also puts new emphasis on restoring and 
replacing the Nation's aging public transportation infrastructure by 
establishing a new State of Good Repair formula program and new asset 
management requirements. In addition, it aligns Federal funding with 
key performance goals and tracks recipients' progress towards these 
goals. Finally, MAP-21 improves the efficiency of program 
administration through program consolidation and streamlining.
    In addition to MAP-21 updates addressed above, and outlined below, 
the proposed circular updates the organization and wording of the 
existing circular to improve clarity and to achieve consistency with 
FTA's other guidance circulars and to reflect other changes made by 
MAP-21, specifically to the 5307 program. When adopted, the final 
circular will supersede the existing circular.
    This document does not include the proposed circular for which FTA 
seeks comment; however, an electronic version is available on FTA's Web 
site, at www.fta.dot.gov. Paper copies may be obtained by contacting 
FTA's Administrative Services Help Desk, at (202) 366-4865.
    Following, is a chapter-by-chapter analysis of the substantive 
changes to the existing circular's content.

[[Page 23819]]

II. Chapter-by-Chapter Analysis

A. Chapter I--Introduction and Background

    Chapter I of the circular is an introductory chapter that covers 
general information about FTA, provides a brief history of the 5307 
program, and defines terms applicable across all FTA programs.
(1) Definitions
    The proposed circular updates the definitions section to include 
changes and additions made by MAP-21. The following statutory 
definitions were amended by MAP-21:

 Associated transit improvements (previously ``transit 
enhancements'')
 Bus rapid transit (BRT) system
 Commuter highway vehicle or vanpool vehicle
 Disability
 Fixed guideway
 Job access and reverse commute project
 Low income individual
 Private provider of public transportation by vanpool
 Public transportation
 Regional transportation planning organization
 Senior

    Definitions have also been added to this section for terms that are 
unclear or currently undefined. Where applicable, we have used the same 
definitions found in rulemakings or other circulars to ensure 
consistency.
(2) Program History
    This section provides an overview of each piece of legislation that 
has authorized the 5307 Program. This section has been revised to 
incorporate a summary of changes made by MAP-21.

B. Chapter II--Program Overview

    Chapter II covers general information about the 5307 Program.
(1) Statutory Authority
    This section updates the exiting circular to include references to 
MAP-21. MAP-21 authorized the award of 5307 program funds for certain 
new and redefined activities including, job access reverse commute 
projects, operating costs, and associated transit improvements, each of 
which is discussed further, below.
(2) Census Designation of Urbanized Areas (UZA)
    The proposed circular adds this new section which describes the 
designation of UZAs based on the 2010 Census. Beginning this fiscal 
year (FY), FY 2013, FTA incorporated the results of the 2010 Census 
into its formula apportionments. The 2010 Census data shows that the 
number of UZAs increased from 465 in 2000 to 497 in 2010, and the total 
population residing in UZAs increased from 195 to 223 million, an 
increase of approximately 12 percent. As a result, some UZAs have 
crossed statutorily-mandated population thresholds resulting in changes 
to the amount of formula funds that those areas can receive, and 
possibly resulting in changes to eligible uses of those funds.
(3) FTA Role in Program Administration
    This section clarifies that funds are apportioned to States and 
Designated Recipients (DR), only--States for small UZAs (areas between 
50,000 and 200,000 in population), and DRs for large UZAs (areas over 
200,000 in population). This section also discusses the requirement 
that large UZA's ensure that the annual Program of Projects complies 
with the requirements that a portion of apportioned funds be spent on 
security and associated transit improvement projects. FTA believes that 
its previous interpretation of these requirements was inaccurate, and 
now interprets each provision to require their application at the UZA 
level. In other words, each 1 percent set aside will apply to the 5307 
apportionment to the UZA, and not to each 5307 DR. This is because the 
UZA, and not the designated recipient, is required to certify that 1 
percent of the apportionment is set aside for each of these two 
purposes. Once the DR receives the apportionment, it will allocate the 
1 percent requirement among the direct recipients (transit agencies).
(4) Direct Recipient and Subrecipient Eligibility
    This new section clarifies the process for selecting and 
establishing a Designated Recipient (DR), and clarifies the process for 
allocating funds to direct recipients and for sub-awarding funds to 
subrecipients. Direct recipients must be a public entity that is 
legally eligible to apply for FTA funding. If certain requirements are 
met, a public agency may apply for some or all of a UZA's 
apportionment.
(5) Subrecipient Arrangements
    Because Congress has repealed the former section 5316 JARC program 
and included job access reveres commute projects within the list of 
eligible 5307 activities, FTA believes that Congress intended for 
entities eligible under the former JARC program to be eligible to use 
MAP-21 5307 program funds for job access reverse commute projects; this 
would include private non-profit operators of job access reverse 
commute projects as subrecipients.
(6) Transportation Management Areas (TMAs)
    TMAs are not synonymous with large UZAs, which is how the term is 
currently used in the existing circular. This circular explains that 
TMAs apply only to the planning requirements.
(7) Relationship to Other Programs
    This section adds a discussion on both repealed SAFETEA-LU programs 
for which funds may still be available, and new MAP-21 programs. The 
discussion on FHWA flexible funds in the existing circular has been 
moved to chapter V.
(a) Repealed SAFETEA-LU Programs
    This section discusses the relationship between programs repealed 
by MAP-21 and the 5307 program as amended by MAP-12. Funds previously 
authorized for programs that were repealed by MAP-21 may remain 
available for their originally authorized purposes until the statutory 
period of availability expires, or until the funds are fully expended, 
rescinded by Congress, or otherwise reallocated.
    The following programs were repealed by MAP-21:

 Clean Fuels Grant Program (former section 5308)
 Bus and Bus Facilities Discretionary Program (former section 
5309)b)(3)
 Job Access and Reverse Commute Program (former section 5316)
 Paul S. Sarbanes Transit in the Parks Program (former section 
5320)
 New Freedom Program (former section 5317)
 Alternatives Analysis Program (former section 5339)
(b) New MAP-21 Programs
    This section discusses the relationship between the 5307 program, 
as amended by MAP-21, and the following programs that are either 
completely new or were significantly modified by MAP-21.

 Fixed Guideway Capital Investment Program (5309, New and Small 
Starts, and Core Capacity Improvements)
 Bus and Bus Facilities Formula Program (5339)
 State of Good Repair Formula Program (5337)
 Rural Area Formula Program (5311)
 Transit Oriented Development Pilot Program (section 20005(b) 
of MAP-21)
 Transportation Alternatives Program (23 U.S.C. 213(b))

[[Page 23820]]

 Federal Lands Access Program (23 U.S.C. 204)

C. Chapter III--General Program Information

    This chapter discusses in more detail the apportionments for the 
5307 program. It also discusses the Federal share of projects costs, 
local share, other sources of financing, and the new Passenger Ferry 
Discretionary Grant Program. Discussion of eligible projects was moved 
from chapter III in the existing to chapter IV in the proposed 
circular.
(1) Apportionment of Program Funds
    In the proposed circular, this section includes the revised 
apportionment calculations, including the new set-asides and formula 
calculations established by MAP-21. Section 5336(h) now provides that 
3.07% of section 5307 funds available for apportionment are allocated 
on the basis of low-income persons residing in urbanized areas, with 25 
percent of these funds allocated to areas below 200,000 in population 
and the remaining 75 percent allocated to areas 200,000 and over in 
population. MAP-21 also increased the percentage of funds allocated on 
the basis of Small Transit Intensive Cities (STIC) factors from 1 to 
1.5 percent. Finally, MAP-21 established a new 0.5 percent takedown 
from the 5307 program for the State Safety Oversight Grant Program and 
a $30 million takedown for the new Passenger Ferry Discretionary Grant 
Program.
(2) Funds Availability
    Generally, MAP-21 extended the number of years that apportioned 
funds remain available for obligation from 3 to 5 additional years from 
the year in which the funds were apportioned. As a result, most funds 
are now available for a total of 6 years including the year of 
apportionment.
(3) Passenger Ferry Grants Discretionary Program
    This section of the proposed circular adds a brief introduction of 
the new Passenger Ferry Discretionary Grant Program. Each fiscal year, 
a total of $30 million is authorized to be set aside from the 5307 
program to support passenger ferry projects that will be selected on a 
competitive basis.
(4) Federal Share of Project Costs for Certain Projects--Americans With 
Disabilities Act, Clean Air Act
    As a result of MAP-21, the Federal share of project costs is 85 
percent for certain projects related to the Americans with Disabilities 
Act (ADA) and the Clean Air Act (CAA).
(5) Local Share of Project Costs
    Generally, and consistent with MAP-21, the proposed circular does 
not change the local match requirements--there is a 20 percent local 
match requirement for capital assistance and a 50 percent requirement 
for operating assistance. However, MAP-21 expanded the category of 
funds that can be used as local match. In addition to those sources of 
local match previously authorized under SAFETEA-LU, local match may 
also be derived from the following newly authorized sources:
     Amounts appropriated or otherwise made available to a 
department of agency of the Government (other than DOT), such as 
Community Development Block Grant Funds administered by the Department 
of Housing and Urban Development.
     Any amount expended by providers of public transportation 
by vanpool for the acquisition of rolling stock to be used in the 
recipient's service area, excluding any amounts the provider may have 
received in Federal, State or local government assistance for such 
acquisition. The provider is required to have a binding agreement with 
the public transportation agency to provide service in the relevant 
UZA.
(6) Alternative Financing--Transportation Infrastructure Financing and 
Innovation Act (TIFIA)
    This section of the proposed circular updates the eligibility 
criteria for capital projects seeking TIFIA financing, pursuant to 
section 2002 of MAP-21 (23 U.S.C. 601 et seq). Eligible projects 
include any transit capital project which is anticipated to meet the 
statutory threshold size.
Chapter IV--Eligible Projects and Requirements
    In the proposed circular, project eligibility and requirements was 
moved from chapter III into a new chapter IV. This chapter discusses 
the types of projects and activities that may be funded under the 5307 
program.
(1) Joint Development Projects
    This section has been revised to update the statutory citation, 
include a definition of joint development, and express the relationship 
between joint development and private sector participation.
(2) Clean Air Act (CAA) Projects
    Vehicles powered by biodiesel fuel or clean fuel are no longer 
eligible CAA projects.
(3) Public Transportation Safety Certification Training
    MAP-21 requires FTA to establish a Public Transportation Safety 
Certification Training Program. Once established, a recipient may use 
up to half of 1 percent of their 5307 apportionment towards safety 
certification training under 49 U.S.C. 5329(c).
(4) Operating Assistance
    Recipients in urbanized areas under 200,000 in population may use 
5307 program funds for operating assistance at a 50 percent Federal 
share. There is no cap to the amount that can be used in these areas 
for operating assistance. Unless specifically authorized, recipients in 
urbanized areas of 200,000 or more in population are not permitted to 
use program funds for operating assistance.
    Under MAP-21, a special rule allows recipients in urbanized areas 
with populations of 200,000 or above and that operate 100 or fewer 
buses in fixed route service during peak hours, to receive a grant for 
operating assistance subject to a maximum amount per system, subject to 
the following:
     Public transportation systems that operate a minimum of 76 
buses and a maximum of 100 buses in fixed route service during peak 
service hours may receive operating assistance in an amount not to 
exceed 50 percent of the share of the apportionment that is 
attributable to such systems within the urbanized area, as measured by 
vehicle revenue hours.
    Public transportation systems that operate 75 or fewer buses in 
fixed route service during peak service hours may receive operating 
assistance in an amount not to exceed 75 percent of the share of the 
apportionment that is attributable to such systems within the urbanized 
area, as measured by vehicle revenue hours.
(5) Design and Art in Public Buildings
    Under MAP-21, ``public art'' is no longer an eligible associated 
transit improvement (formerly ``transit enhancement''). However, 
incorporation of design and artistic considerations into public 
transportation projects may still be an allowable cost, so long as it 
is an integral part of the project. For example, an artist may be 
employed as part of the construction design team, or art can be 
incorporated into functional elements such as walls, seating, lighting, 
or railings.

[[Page 23821]]

(6) Job Access Reverse Commute Projects
    The SAFETEA-LU Job Access and Reverse Commute (JARC) Program, 
(former section 5316), was repealed by MAP-21; however, job access and 
reverse commute projects are now eligible under the 5307 program. A job 
access reverse commute project is a ``transportation project to finance 
planning, capital, and operating costs that support the development and 
maintenance of transportation services designed to transport welfare 
recipients and eligible low-income individuals to and from jobs and 
activities related to their employment, including transportation 
projects that facilitate the provision of public transportation 
services from urbanized areas and rural areas to suburban employment 
locations--49 U.S.C. 5302(9).''
    Each potential project must be for the ``development'' or 
``maintenance'' of transportation services designed to transport 
welfare recipients and eligible low-income individuals to and from jobs 
and employment-related activities and also must be otherwise eligible 
under the 5307 Program. FTA defines ``development of transportation 
services'' to mean new projects that were not in service on October 1, 
2012. Job access reverse commute projects eligible for funds under 
section 5307, as amended by MAP-21, must be designed for the target 
population. New job access and reverse commute projects may include the 
expansion or extension of an existing service, so long as the new 
service was designed to support the target populations; however, such 
projects are not required to be designed for the sole use of the target 
populations.
    This section also proposes new policy that would eliminate from the 
list of eligible activities/expenses, the car loan program and expenses 
related to the voucher programs.
    Although job access and reverse commute projects are not required 
to be developed through a coordinated planning process, the project 
must be identified by the MPO and DR as a job access and reverse 
commute project in the DR's annual Program of Projects, which must be 
developed in consultation with interested parties, published with the 
opportunity for comments, and subject to a public hearing.
    The unobligated carryover balances of pre-MAP-21 JARC program funds 
may be obligated through the period of availability, but must follow 
the SAFETEA-LU requirements. For example, section 5316 JARC projects 
must still be derived from a human service public transportation 
coordinated plan and must also be selected by the DR through an area-
wide or statewide competitive selection process. Although not required 
by law, FTA encourages recipients to continue to use the coordinated 
planning process to identify and develop job access and reverse commute 
projects for funding under Section 5307, as amended by MAP-21.
(7) Interest and Debt Financing-Debt Service Reserve
    The proposed circular removes the section on Debt Service Reserve 
because MAP-21 repealed the 5307 debt service reserve pilot program at 
49 U.S.C. 5323(e)(4)(A), as amended by SAFETEA-LU.

D. Chapter V--Planning and Program Development

    This proposed new chapter would replace chapter V in the existing 
circular titled ``Coordinated Planning.'' Under SAFETEA-LU, certain 
eligible projects were required to be developed under a locally 
developed, coordinated planning process. Under MAP-21, coordinated 
planning is only a requirement of eligibility under the section 5310 
program.
(1) Transportation Management Areas
    This section of the proposed circular revises the discussion of 
TMAs for planning purposes. The proposed circular references the 
statutory definition of a TMA, which is a UZA with a population of over 
200,000 individuals. There is also reference to the joint FTA/FHWA 
transportation planning regulations at 23 CFR part 40, which include 
guidelines on determining the boundaries of a Metropolitan Planning 
Area (MPA).
(2) Performance Based Standards
    This new section of the proposed circular discusses the 
requirements of MAP-21's new broad performance management program which 
supports the seven national performance goals. The performance 
management framework attempts to improve project decision-making 
through performance-based planning and programming and through 
fostering a transparent and accountable decision-making process for 
MPOs, States, and providers of public transportation.
(3) Coordinated Planning
    This section of the proposed circular updates the language on 
coordinated planning, which is no longer required for projects funded 
with 5307 Program funds. However, 5307 recipients who will apply for 
section 5310 funds are still required to participate in the local 
planning process for coordinated public transit-human services. 
Moreover, FTA strongly encourages 5307 recipients to engage in a 
coordinated planning process.
(4) Availability of FHWA ``Flexible Funds'' for Transit Projects
    This section of the proposed circular clarifies the availability of 
FHWA funds for eligible transit projects. FHWA flexible funds may be 
available to FTA recipients for planning and capital projects, and 
operating expenses. This section also clarifies the requirements for 
transfer of Congestion Mitigation and Air Quality (CMAQ) Improvement 
Program funds. Generally, funds appropriated for the 5307 program in in 
FY 2013 and beyond, are no longer authorized to be transferred to FHWA.
(5) Associated Transit Improvements
    MAP-21 changed the term ``transit enhancements'' to ``associated 
transit improvements.'' An associated transit improvement is a project 
``designed to enhance public transportation service or use and that 
[is] physically or functionally related to transit facilities.'' This 
section of the proposed circular discusses the requirements to expend a 
percentage of a urbanized area's 5307 program funds on associated 
transit improvements and also discusses eligible projects.
    As previously stated, public art and transit connections to parks 
within the recipient's transit service area are no longer eligible 
projects. While Federal transit funds are no longer available to 
support public art in transit facilities, art can be incorporated into 
facility design, landscaping, and historic preservation.
(6) Public Transportation Security Projects
    This section discusses the public transportation security project 
certification requirement. The proposed circular limits the list of 
eligible security projects to those explicitly referenced in MAP-21.
(7) Environmental
    This section in the proposed circular has been revised to clarify 
that recipients should consult with FTA regarding the proper level of 
environmental review, prior to expending funds for a project.
(8) Undertaking Projects in Advance
    The proposed circular revises this section to explain the different

[[Page 23822]]

authorities that allow a recipient to incur costs on a project before 
grant approval, while still retaining their eligibility for 
reimbursement for eligibility after grant approval. The three types of 
authorities are Pre-award authority, letters of no prejudice (LONP), 
and advanced construction authority (ACA). This section discusses the 
distinction among these three authorities and the terms and conditions 
that apply equally to all three.

E. Chapter VI--Program Management and Administrative Requirements

(1) Certifications Required by 49 U.S.C. 5307
    The proposed circular updates this section to add the requirement 
that recipients certify compliance with 49 U.S.C. 5329(d), which 
requires recipients and States to develop and implement a Public 
Transportation Agency Safety Plan, and 49 U.S.C. 5326, which requires 
each recipient and subrecipient to develop a Transit Asset Management 
Plan.
(2) Expenditures on Public Transportation Security
    This section discusses the public transportation security projects 
certification requirement. The security requirement applies to the DR 
on the UZA apportionment, and not to individual recipients. Therefore, 
the DR must complete this certification.
(3) FTA Electronic Grants Management System
    In this section of the proposed circular, references to FTA's 
electronic grants management system--TEAM, have been removed in 
consideration of a new system, currently under development.
(4) Federal Funding Accountability and Transparency Act (FFATA) 
Requirement
    The proposed circular adds this new section which discusses the 
statutory requirement that a recipient report information about each 
first tier sub-award over $25,000 by the end of the month following the 
month the direct recipient makes any sub-award or obligation.
(5) National Transit Database (NTD) Reporting--Waivers
    There are no longer any waivers; however, there is a reduced 
reporting requirement for small systems.

F. Chapter VII--Other Provisions

(1) State Safety Oversight
    This section of the proposed circular clarifies the affect that 
MAP-21 has had on the State Safety Oversight (SSO) Program and the 
requirements of 49 CFR 659. Section 5330, which authorizes the SSO 
Program, will be repealed three years from the effective date of the 
new regulations implementing the new section 5329 safety requirements. 
Until then, the current requirements of 49 CFR 659 will continue to 
apply.

G. Tables, Graphs, and Illustrations

    There are no proposed changes to the tables, graphs, and 
illustrations.

H. Appendices

    There are no proposed changes to existing appendices.

    Issued in Washington, DC, this 15th day of April, 2013.
Peter Rogoff,
Administrator.
[FR Doc. 2013-09333 Filed 4-19-13; 8:45 am]
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