[Federal Register Volume 83, Number 180 (Monday, September 17, 2018)]
[Notices]
[Pages 46992-46996]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-20097]


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DEPARTMENT OF TRANSPORTATION

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.

ACTION: Notice.

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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 the responsibilities it has assumed, in lieu 
of FHWA. This program mandates annual audits during each of the first 4 
years to ensure the State's compliance with program requirements. This 
notice finalizes the findings of the first audit report for the Utah 
Department of Transportation (UDOT).

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.

SUPPLEMENTARY INFORMATION:

Electronic Access

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

Background

    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, 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 end 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 finalizes 
the findings of the first audit report for UDOT participation in the 
NEPA Assignment program. The FHWA published a draft version of this 
report in the Federal Register on April 13, 2018, at 83 FR 16170, and 
made it available for public review and comment for 30 days in 
accordance with 23 U.S.C. 327(g). The FHWA received two responses to 
the Federal Register notice during the public comment period for the 
draft report. Neither of the comments were substantive. One comment 
from the American Road and Transportation Builders Association outlined 
their general support for this program. The second comment was from an 
anonymous individual and the comment was unrelated to the report. The 
FHWA considered both comments and determined that neither comment 
triggered changes in the content of the report. This notice includes 
the final version of the audit report.

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

Brandye L. Hendrickson,
Deputy Administrator, Federal Highway Administration.

Surface Transportation Project Delivery Program

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's) 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

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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 MOU covers environmental 
review responsibilities for projects that require the preparation of 
environmental assessments (EA), 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 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 the 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.

Background

    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 in lieu of FHWA. 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 (16 U.S.C. 1531 et seq.) and consultation under 
section 106 of the National Historic Preservation Act (54 U.S.C. 
306108).
    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 oversees 
UDOT's compliance with the MOU and the NEPA Assignment Program 
requirements. This 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, CA, 
Washington, DC, Atlanta, GA, and Austin, TX. 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 the 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 
staff.
    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

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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.

Observations

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

    The UDOT uses a document database called ``ProjectWise'' 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.

Observations

    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,

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UDOT does not use this function nor does it have adequate functionality 
for searching files or tracking project environmental process 
milestones.

Quality Assurance/Quality Control

    At the time of the first audit UDOT was in the early stages of the 
section 327 program, and because there was 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 
approval.
    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.

Observations

    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 understood 
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 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 
Utah 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.

Training

    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.

Observations

    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.

Finalizing the Report

    The FHWA published a draft version of this report in the Federal 
Register on April 13, 2018, at 83 FR 16170, and made it available for 
public review and comment for 30 days in accordance with 23 U.S.C. 
327(g). The FHWA received two responses to the Federal Register notice 
during the public comment period for the draft report. Neither of the 
comments were substantive. One comment from the American Road and 
Transportation Builders Association outlined their support for this 
program. The second comment was from an anonymous individual and the 
comment was unrelated to the report.

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The FHWA considered both comments and determined that neither comment 
triggered changes in the content of the report. This is FHWA's final 
version of the audit report.

[FR Doc. 2018-20097 Filed 9-14-18; 8:45 am]
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