[Federal Register Volume 83, Number 72 (Friday, April 13, 2018)]
[Pages 16170-16174]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-07751]



Federal Highway Administration

[FHWA Docket No. FHWA-2018-0008]

Surface Transportation Project Delivery Program; Utah Department 
of Transportation Audit Report

AGENCY: Federal Highway Administration (FHWA), U.S. Department of 
Transportation (DOT).

ACTION: Notice; Request for comment.


SUMMARY: The Moving Ahead for Progress in the 21st Century Act (MAP-21) 
established the Surface Transportation Project Delivery Program that 
allows a State to assume FHWA's environmental responsibilities for 
environmental review, consultation, and compliance under the National 
Environmental Policy Act (NEPA) for Federal highway projects. When a 
State assumes these Federal responsibilities, the State becomes solely 
responsible and liable for carrying out the responsibilities it has 
assumed, in lieu of FHWA. This program mandates annual audits during 
each of the first 4 years of State participation to ensure compliance 
with program requirements. This notice announces and solicits comments 
on the first audit report for the Utah Department of Transportation 

DATES: Comments must be received on or before May 14, 2018.

ADDRESSES: Mail or hand deliver comments to Docket Management Facility: 
U.S. Department of Transportation, 1200 New Jersey Avenue SE, Room W12-
140, Washington, DC 20590. You may also submit comments electronically 
at www.regulations.gov. All comments should include the docket number 
that appears in the heading of this document. All comments received 
will be available for examination and copying at the above address from 
9 a.m. to 5 p.m., e.t., Monday through Friday, except Federal holidays. 
Those desiring notification of receipt of comments must include a self-
addressed, stamped postcard or you may print the acknowledgment page

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that appears after submitting comments electronically. Anyone can 
search the electronic form of all comments in any of our dockets by the 
name of the individual submitting the comment (or signing the comment, 
if submitted on behalf of an association, business, or labor union). 
The DOT posts these comments, without edits, including any personal 
information the commenter provides, to www.regulations.gov, as 
described in the system of records notice (DOT/ALL-14 FDMS), which can 
be reviewed at www.dot.gov/privacy.

FOR FURTHER INFORMATION CONTACT: Ms. Deirdre Remley, Office of Project 
Development and Environmental Review, (202) 366-0524, 
[email protected], or Mr. Jomar Maldonado, Office of the Chief 
Counsel, (202) 366-1373, [email protected], Federal Highway 
Administration, U.S. Department of Transportation, 1200 New Jersey 
Avenue SE, Washington, DC 20590. Office hours are from 8:00 a.m. to 
4:30 p.m., e.t., Monday through Friday, except Federal holidays.


Electronic Access

    An electronic copy of this notice may be downloaded from the 
specific docket page at www.regulations.gov.


    The Surface Transportation Project Delivery Program, codified at 23 
United States Code (U.S.C.) 327, commonly known as the NEPA Assignment 
Program, allows a State to assume FHWA's environmental responsibilities 
for review, consultation, and compliance for Federal highway projects. 
When a State assumes these Federal responsibilities, the State becomes 
solely liable for carrying out the responsibilities it has assumed, in 
lieu of the FHWA. The UDOT published its application for NEPA 
assumption on October 9, 2015, and made it available for public comment 
for 30 days. After considering public comments, UDOT submitted its 
application to FHWA on December 1, 2015. The application served as the 
basis for developing a memorandum of understanding (MOU) that 
identifies the responsibilities and obligations that UDOT would assume. 
The FHWA published a notice of the draft MOU in the Federal Register on 
November 16, 2016, with a 30-day comment period to solicit the views of 
the public and Federal agencies. After the close of the comment period, 
FHWA and UDOT considered comments and proceeded to execute the MOU. 
Effective January 17, 2017, UDOT assumed FHWA's responsibilities under 
NEPA, and the responsibilities for NEPA-related Federal environmental 
laws described in the MOU.
    Section 327(g) of Title 23, U.S.C., requires the Secretary to 
conduct annual audits during each of the first 4 years of State 
participation. After the fourth year, the Secretary shall monitor the 
State's compliance with the written agreement. The results of each 
audit must be made available for public comment. This notice announces 
the availability of the first audit report for UDOT and solicits public 
comment on same.

    Authority: Section 1313 of Pub. L. 112-141; Section 6005 of Pub. 
L. 109-59; 23 U.S.C. 327; 23 CFR 773.

    Issued on: April 4, 2018.
Brandye L. Hendrickson,
Acting Administrator, Federal Highway Administration.

Surface Transportation Project Delivery Program

Draft FHWA Audit of the Utah Department of Transportation

January 17-June 9, 2017

Executive Summary

    This report summarizes the results of the Federal Highway 
Administration's (FHWA) first audit of the Utah Department of 
Transportation's (UDOT) National Environmental Policy Act (NEPA) review 
responsibilities and obligations that FHWA has assigned and UDOT has 
assumed pursuant to 23 United States Code (U.S.C.) 327. Throughout this 
report, FHWA uses the term ``NEPA Assignment Program'' to refer to the 
program codified at 23 U.S.C. 327. Under the authority of 23 U.S.C. 
327, UDOT and FHWA executed a memorandum of understanding (MOU) on 
January 17, 2017, to memorialize UDOT's NEPA responsibilities and 
liabilities for Federal-aid highway projects and certain other FHWA 
approvals for transportation projects in Utah. Except for one project, 
which FHWA retained, FHWA's only NEPA responsibilities in Utah are 
oversight and review of how UDOT executes its NEPA Assignment Program 
obligations. The section 327 MOU covers environmental review 
responsibilities for projects that require the preparation of 
environmental assessments (EAs), environmental impact statements (EIS), 
and non-designated documented categorical exclusions (DCE). A separate 
MOU, pursuant to 23 U.S.C. 326, authorizes UDOT's environmental review 
responsibilities for other categorical exclusions (CE), commonly known 
as CE Program Assignment. This audit does not cover the CE Program 
Assignment responsibilities and projects.
    As part of its review responsibilities under 23 U.S.C. 327, FHWA 
formed a team in April 2017 to plan and conduct an audit of NEPA 
responsibilities UDOT assumed. Prior to the on-site visit, the Audit 
Team reviewed UDOT's NEPA project files, UDOT's response to FHWA's pre-
audit information request (PAIR), and UDOT's self-assessment of its 
NEPA Program. The Audit Team reviewed additional documents and 
conducted interviews with UDOT staff in Utah on June 5-9, 2017.
    The UDOT entered into NEPA Assignment Program after almost 9 years 
of experience making FHWA NEPA CE determinations pursuant to 23 U.S.C. 
326 (beginning August 2008). The UDOT's environmental review procedures 
are compliant for CEs, and UDOT is implementing procedures and 
processes for DCEs, EAs, and EISs as part of its new responsibilities 
under the NEPA Assignment Program. Overall, the Audit Team found that 
UDOT is successfully adding DCE, EA, and EIS project review 
responsibilities to an already successful CE review program. The Audit 
Team did not identify any non-compliance observations. This report 
describes five observations as well as several successful practices the 
Audit Team found. The Audit Team finds UDOT is carrying out the 
responsibilities it has assumed and is in substantial compliance with 
the provisions of the MOU.


    The NEPA Assignment Program allows a State to assume FHWA's 
environmental responsibilities for review, consultation, and compliance 
for Federal-aid highway projects. Under 23 U.S.C. 327, a State that 
assumes these Federal responsibilities becomes solely responsible and 
solely liable for carrying them out. Effective January 17, 2017, UDOT 
assumed FHWA's responsibilities under NEPA and other related 
environmental laws. Examples of responsibilities UDOT has assumed in 
addition to NEPA include section 7 consultation under the Endangered 
Species Act and consultation under section 106 of the National Historic 
Preservation Act.
    Following this first audit, FHWA will conduct three more annual 
audits to satisfy provisions of 23 U.S.C. 327(g) and Part 11 of the 
MOU. Audits are the primary mechanism through which FHWA may oversee 
UDOT's compliance with the MOU and the NEPA Assignment Program 
requirements. This

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includes ensuring compliance with applicable Federal laws and policies, 
evaluating UDOT's progress toward achieving the performance measures 
identified in MOU Section 10.2, and collecting information needed for 
the Secretary's annual report to Congress. The FHWA must present the 
results of each audit in a report and make it available for public 
comment in the Federal Register.
    The Audit Team consisted of NEPA subject matter experts (SME) from 
the FHWA Utah Division, as well as from FHWA offices in Sacramento, 
California, Washington, District of Columbia, Atlanta, Georgia, and 
Austin, Texas. These experts received training on how to evaluate 
implementation of the NEPA Assignment Program. In addition, the FHWA 
Utah Division designated an environmental specialist to serve as a NEPA 
Assignment Program liaison to UDOT.

Scope and Methodology

    The Audit Team conducted an examination of UDOT's NEPA project 
files, UDOT responses to the PAIR, and UDOT self-assessment. The audit 
also included interviews with staff and reviews of UDOT policies, 
guidance, and manuals pertaining to NEPA responsibilities. All reviews 
focused on objectives related to the six NEPA Assignment Program 
elements: program management; documentation and records management; 
quality assurance/quality control (QA/QC); legal sufficiency; training; 
and performance measurement.
    The focus of the audit was on UDOT's process and program 
implementation. Therefore, while the Audit Team reviewed project files 
to evaluate UDOT's NEPA process and procedures, the team did not 
evaluate UDOT's project-specific decisions to determine if they were, 
in FHWA's opinion, correct or not. The Audit Team reviewed 14 NEPA 
Project files with DCEs, EAs, and EISs, representing all projects in 
process or initiated after the MOU's effective date. The Audit Team 
also interviewed environmental staff in all four UDOT regions as well 
as their headquarters office.
    The PAIR consisted of 24 questions about specific elements in the 
MOU. The Audit Team used UDOT's response to the PAIR to develop 
specific follow-up questions for the on-site interviews with UDOT 
    The Audit Team conducted 18 on-site and 3 phone interviews. 
Interview participants included staff from each of UDOT's four regional 
offices and UDOT headquarters. The Audit Team invited UDOT staff, 
middle management, and executive management to participate to ensure 
the interviews represented a diverse range of staff expertise, 
experience, and program responsibility.
    Throughout the document reviews and interviews, the Audit Team 
verified information on the UDOT section 327 NEPA Assignment Program 
including UDOT policies, guidance, manuals, and reports. This included 
the NEPA QA/QC Guidance, the NEPA Assignment Training Plan, and the 
NEPA Assignment Self-Assessment Report.
    The Audit Team compared the procedures outlined in UDOT 
environmental manuals and policies to the information obtained during 
interviews and project file reviews to determine if there are 
discrepancies between UDOT's performance and documented procedures. The 
team documented observations under the six NEPA Assignment Program 
topic areas. Below are the audit results.
    Overall, UDOT has carried out the environmental responsibilities it 
assumed through the MOU and the application for the NEPA Assignment 
Program, and as such the Audit Team finds that UDOT is substantially 
compliant with the provisions of the MOU.

Observations and Successful Practices

    This section summarizes the Audit Team's observations of UDOT's 
NEPA Assignment Program implementation, including successful practices 
UDOT may want to continue or expand. Successful practices are positive 
results that FHWA would like to commend UDOT on developing. These may 
include ideas or concepts that UDOT has planned but not yet 
implemented. Observations are items the Audit Team would like to draw 
UDOT's attention to, which may benefit from revisions to improve 
processes, procedures, or outcomes. The UDOT may have already taken 
steps to address or improve upon the Audit Team's observations, but at 
the time of the audit they appeared to be areas where UDOT could make 
improvements. This report addresses all six MOU topic areas as separate 
discussions. Under each area, this report discusses successful 
practices followed by observations.
    This audit report provides an opportunity for UDOT to begin 
implementing actions to improve their program. The FHWA will consider 
the status of areas identified for potential improvement in this 
audit's observations as part of the scope of Audit #2. The second Audit 
Report will include a summary discussion that describes progress since 
the last audit.

Program Management

    The UDOT has made progress toward meeting the initial requirements 
of the MOU for the NEPA Assignment Program under 23 U.S.C. 327, 
including implementing the updated Manual of Instruction (MOI), a QA/QC 
Plan, a Training Plan, and addressing the findings from a Self-
Assessment Report.

Successful Practices

    The Audit Team found that UDOT understands its project-level 
responsibility for DCEs, EAs, and EISs that FHWA assigned to UDOT 
through the NEPA Assignment Program. The UDOT has established a vision 
and direction for incorporating the NEPA Assignment Program into its 
overall project development process. This was clear in the PAIR 
responses and in interviews with staff in the regions and at UDOT's 
central office, commonly known as ``the Complex.''
    The UDOT reorganized environmental staff to align employee roles 
with the new responsibilities under the NEPA Assignment Program. Staff 
at the Complex are responsible for EAs and EISs. Regional environmental 
staff coordinate their NEPA work through Program Managers at the 
Complex. Environmental staff also share resources and use the subject 
matter expertise of staff in other regional offices or at the Complex. 
Some staff responsibilities have changed under the NEPA Assignment 
Program, but positions have remained the same. Prior to assuming 
responsibilities under the NEPA Assignment Program, regional staff 
reported to the pre-construction department in their regional office. 
Following assumption of the NEPA Assignment Program, Environmental 
Managers in the regions report to Environmental Program Managers at the 
Complex. In anticipation of assuming NEPA responsibilities, UDOT hired 
an Environmental Performance Manager who is responsible for overseeing 
UDOT's policies, manuals, guidance, and training under the NEPA 
Assignment Program.


Observation #1: Communication of UDOT policy and procedures to staff

    Most SMEs and regional environmental staff were not aware of the 
latest policies and procedures regarding the NEPA Assignment Program. 
During interviews, some staff at the regional offices and at the 
Complex said they heard about changes at quarterly environmental 
meetings. Some regional staff said they expect to hear about changes 
from their Managers

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in the regional office, but they often feel they do not receive all 
necessary information. Other regional staff said they receive updated 
memoranda and other communications about the NEPA Assignment Program 
through their Program Manager at the Complex. Some SMEs indicated they 
were unaware of how their specialty fits into the overall NEPA process. 
There does not seem to be a clear understanding among all staff about 
the differences between UDOT's responsibilities under 23 U.S.C. 326 and 
23 U.S.C. 327 and how this affects staff members' roles and 
responsibilities in carrying out section 327.

Observation #2: Section 4(f) terms regarding determinations of use

    During review of the NEPA Project files, the Audit Team found some 
determinations labeled ``n/a,'' suggesting Section 4(f) was not 
applicable when there was a historic site/historic property identified 
in the Section 106 determination of eligibility/finding of effect (DOE/
FOE). In other examples, the files correctly indicate ``yes'' or ``no'' 
whether there is or is not a Section 4(f) use. When the DOE/FOE 
identifies historic properties that are eligible for inclusion in the 
National Register of Historic Places, UDOT would also need to evaluate 
whether the action will constitute a use under Section 4(f), per FHWA 
policy (see ``3.2 Assessing Use of Section 4(f) Properties'' in FHWA 
``Section 4(f) Policy Paper,'' 2012). Therefore, the correct 
determination should be ``yes'' or ``no'' instead of ``n/a''.

Documentation and Records Management

    The Audit Team reviewed UDOT's NEPA Project documents for 14 
projects under the NEPA Assignment Program. The UDOT maintains a 
complete final record for DCEs, EAs, and EISs. There are 
inconsistencies about how, when, and where staff maintain supporting 
draft and deliberative documentation, and staff either do not have or 
are not aware of protocols for recordkeeping.

Successful Practices

    ProjectWise is a document database UDOT uses to maintain final 
project records for DCEs, EAs, and EISs. Though it was not developed 
specifically for producing and maintaining environmental documents, 
ProjectWise is accessible to all staff and can store complete NEPA 
documentation. During interviews, UDOT environmental staff demonstrated 
they understood the minimum documentation that should be included in 
the final ProjectWise record, and the Audit Team verified that the 
minimum documentation is in NEPA Project file reviews.
    In interviews, some UDOT staff shared that they document decisions 
made verbally for the project record. This shows that some staff 
understand the importance of having a written record of decision points 
in the NEPA processes that may happen through phone conversations and 
in-person meetings.
    Environmental Managers at the Complex have taken steps to implement 
consistent records management on EAs and EISs in ProjectWise by adding 
stipulations to consultant contracts that require them to follow 
records management protocols in their final project files.


Observation #3: UDOT recordkeeping and file management

    Some environmental staff interviewed during the audit said they 
store draft files, supporting information, and deliberative 
documentation on personal drives, on local servers, and/or in hardcopy 
filing cabinets. Thus, outside of ProjectWise, UDOT recordkeeping and 
file management is inconsistent, which may indicate the lack of 
specific protocols for managing supporting documents that inform NEPA 
decisions and other environmental determinations. Such practices can 
make document retrieval and review difficult because the location of 
UDOT's file of record is unclear. This issue can also raise concerns 
about document retention practices and the completeness of 
administrative records for projects needing them.
    Staff at the regional offices and at the Complex said ProjectWise 
does not include organizational tools such as subfolders or adequate 
search capabilities. ProjectWise was not created specifically for 
environmental documentation. It is a document management system, and 
although it allows for subfolders with environmental documents storage, 
UDOT does not use this function nor does it have adequate functionality 
for searching files or tracking project environmental process 

Quality Assurance/Quality Control

    The UDOT is in the early stages of the section 327 program, and 
because there is not yet sufficient data on project approvals, the team 
was not able to fully evaluate the effectiveness of the QA/QC component 
of the program. The Audit Team made the following observations.

Successful Practices

    The UDOT has implemented some successful practices to ensure the 
quality of its NEPA documents. The UDOT developed a QA/QC plan to help 
environmental staff and consultants ensure documents are developed, 
reviewed, and approved in accordance with QA/QC procedures. The UDOT's 
use of DCE, EA, and EIS QA/QC checklists supports process 
standardization. Though regional environmental staff do not manage EAs 
or EISs under the NEPA Assignment Program, several staff said they were 
aware there is a QA/QC checklist for reviewing these documents. They 
were also aware that Managers at the Complex review and submit the 
checklist and final document to UDOT's Deputy Director for final 
    Regional environmental staff can contact Program Managers at the 
Complex to get procedural and technical assistance on topics or 
documentation requirements outside of their technical expertise area. 
Throughout the audit interviews, several staff said they felt 
comfortable calling Managers at the Complex with questions.


Observation #4: QA/QC documentation

    Although most environmental staff were aware of the QA/QC plan and 
checklists, the Audit Team learned through interviews that there is 
varied understanding about roles and procedures as they relate to 
documenting QA/QC approvals. Managers demonstrated that they understand 
the various roles and procedures for obtaining signature approval for 
final documents, but regional staff had a varied understanding of these 
procedures. Environmental staff outside of the Complex were also 
uncertain of whether a new checklist was developed for DCEs, or if the 
EA/EIS checklist is used for DCE QA/QC.

Legal Sufficiency

Successful Practices

    Through interviews, the Audit Team learned of the following 
successful practices: UDOT has extended the legal sufficiency process 
it has in place for Section 326 CE assignment to accommodate the 
section 327 NEPA Assignment Program by contracting with outside counsel 
who have extensive experience in NEPA, other environmental laws, and 
Federal environmental litigation. The UDOT Environmental Managers can 
work directly with outside counsel without the need to go through the 

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Attorney General's (AG) Office. An Assistant AG assigned to UDOT is 
kept apprised of all communications between UDOT staff and outside 
counsel. Outside counsel expects early legal involvement for all 
controversial projects. The UDOT, an Assistant AG, and outside counsel 
held an ``organizational meeting'' earlier this year and expect to hold 
regular, quarterly meetings.


    The UDOT's Training Coordinator is in the early stages of 
establishing a Training Management Program (``UDOT U'') for all UDOT 
employees. This program will include the following components: (1) core 
competencies for all UDOT employees; (2) training for all UDOT 
employees through UDOT U; (3) a portal for tracking training completed 
by UDOT employees; (4) SME identification and validation of training 
needs; and (5) leadership input on priorities and budgets for all 
disciplines. The UDOT could incorporate NEPA Assignment Program 
training needs into UDOT U in the future, and the Training Coordinator 
has plans to work with the environmental group on its specific needs.

Successful Practices

    Through interviews and the PAIR response, the Audit Team learned 
that UDOT delivered several discipline-based (e.g., Noise, Section 4f, 
Section 7, Air Quality, and Legal Sufficiency) training courses to 
staff and consultants. The Audit Team learned that UDOT has used the 
annual conference to inform staff and consultants about the NEPA 
Assignment Program and the responsibilities that UDOT has assumed.


Observation #5: UDOT's training plan coordination

    The UDOT developed a NEPA Assignment Program Training Plan, as 
required by the MOU, but through interviews the Audit Team found that 
Environmental Managers developed the plan with minimal coordination 
with the UDOT Training Coordinator, SMEs, or regional staff. In 
interviews, the Audit Team learned that some SMEs did not get 
opportunities to attend training on topics outside their subject area, 
including NEPA. An understanding of NEPA compliance is important for 
all environmental staff, including SMEs. Although ``UDOT U'' has 
offered environmental training on specific topics such as stormwater 
and permitting, the NEPA Assignment Program training plan is not 
integrated into ``UDOT U.''

Performance Measures

    The Environmental Performance Manager has begun collecting and 
tracking performance data, such as the completeness of project records, 
timeline for completion of environmental documents, and whether QA/QC 
was performed for each document. The Environmental Performance Manager 
indicated that the results of this audit will be used to help revise 
manuals and procedures and that the self-assessment informed some 
changes. For example, the MOI has been updated to clarify which 
documents need to be updated and uploaded in projects files.

Successful Practices

    The UDOT surveyed resource agency partners about how it is 
implementing responsibilities under the NEPA Assignment Program. 
Managers said they are striving to improve UDOT's relationships with 
partner agencies despite having different missions and perspectives. 
The environmental group will continue to survey its partners in the 
future, and will modify the survey as needed to help improve UDOT's 
environmental processes and relationships with resource agencies.

Next Steps

    The FHWA provided this draft audit report to UDOT for a 14-day 
review and comment period. The Audit Team considered UDOT comments in 
developing this draft audit report. The FHWA will publish a notice in 
the Federal Register for a 30-day comment period in accordance with 23 
U.S.C. 327(g). No later than 60 days after the close of the comment 
period, FHWA will respond to all comments submitted to finalize this 
draft audit report pursuant to 23 U.S.C. 327(g)(B). The FHWA will 
publish the final audit report in the Federal Register.

[FR Doc. 2018-07751 Filed 4-12-18; 8:45 am]