[Federal Register Volume 84, Number 165 (Monday, August 26, 2019)]
[Proposed Rules]
[Pages 44590-44596]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-18286]



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DEPARTMENT OF TRANSPORTATION

Federal Transit Administration

49 CFR Part 633

[Docket No. FTA-2019-0016]
RIN 2132-AB35


Project Management Oversight

AGENCY: Federal Transit Administration (FTA), DOT.

ACTION: Notice of proposed rulemaking (NPRM); request for comments.

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SUMMARY: The Federal Transit Administration proposes to amend its 
project management oversight rule to make it consistent with recent 
statutory changes and to modify the scope and applicability of the 
rule. FTA seeks comments from project sponsors, the transit industry, 
other stakeholders, and the public on the proposed changes to the rule.

DATES: Comments must be received October 25, 2019. Any comments filed 
after this deadline will be considered to the extent practicable.

ADDRESSES: You may submit comments, identified by the docket number at 
the top of this document, by any of the following methods:
     Federal eRulemaking Portal: Go to http://www.regulations.gov and follow the instructions for submitting 
comments.
     Mail: Docket Management Facility, U.S. Department of 
Transportation, 1200 New Jersey Ave. SE, West Building Ground Floor, 
Room W12-140, Washington, DC 20590-0001.
     Hand Delivery or Courier: West Building Ground Floor, Room 
W12-140, 1200 New Jersey Ave. SE, between 9:00 a.m. and 5:00 p.m. 
Eastern time, Monday through Friday, except Federal holidays.
     Fax: (202) 493-2251.
    Instructions: All submissions received must include the agency name 
and docket number or Regulatory Information Number (RIN) for this 
rulemaking. All comments received will be posted without change to 
www.regulations.gov, including any personal information provided. You 
may review the U.S. Department of Transportation's (DOT) 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 or 
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, M-30, West Building Ground Floor, Room W12-140, between 
9:00 a.m. and 5:00 p.m. Eastern time, Monday through Friday, except 
Federal holidays.

FOR FURTHER INFORMATION CONTACT: For program matters, Corey Walker, 
Office of Program Management, (202) 366-0826 or [email protected]. 
For legal matters, Mark Montgomery, Office of Chief Counsel, (202) 366-
4011 or [email protected].

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Background
II. Section-by-Section Analysis
III. Regulatory Analyses and Notices

I. Background

    Recognizing a compelling need to strengthen the management and 
oversight of major capital projects, in the Surface Transportation and 
Uniform Relocation Assistance Act of 1987 (STURAA) (Pub. L. 100-17) 
(April 2, 1987), Congress authorized FTA's predecessor agency, the 
Urban Mass Transportation Administration (UMTA), to conduct oversight 
of major capital projects and to promulgate a rule for that purpose. 
The statute, now codified at 49 U.S.C. 5327, authorizes FTA to obtain 
the services of project management oversight contractors (PMOCs) to 
assist FTA in overseeing the expenditure of Federal financial 
assistance for major capital projects. Further, the statute requires 
FTA to promulgate a regulation that includes a definition of ``major 
capital project'' to identify the types of projects governed by the 
rule.
    Accordingly, UMTA promulgated a rule for oversight of major capital 
projects on September 1, 1989, at 49 CFR part 633 (54 FR 36708). At 
that time, UMTA's capital programs were comparatively small, relative 
to today, totaling a little more than $2 billion annually. UMTA 
promulgated a regulation that defined ``major capital project'' as any 
project for the construction of a new fixed guideway or extension of an 
existing fixed guideway or a project involving the rehabilitation or 
modernization of an existing fixed guideway with a total project cost 
of $100 million or more. The rule limited covered projects to those 
receiving funds made available under sections 3, 9, or 18 of the 
Federal Mass Transit Act of 1964, as amended, 23 U.S.C. 103(e)(4), or 
section 14(b) of the National Capital Transportation Amendments of 
1979. That rule is still in effect today.
    By 2011, however, the annual dollar value of the Federal transit 
capital programs was nearly five times the level authorized under 
STURAA in 1987, and the number of active PMOC task orders was more than 
double the number in 1987. Furthermore, FTA funded a larger number of 
projects with a total cost of over one billion dollars that presented 
significant oversight challenges. Thus, on September 13, 2011, FTA 
published a Notice of Proposed Rulemaking (NPRM) (76 FR 56378) that 
proposed to enable FTA to identify more clearly the necessary 
management capacity and capability of a sponsor of a major capital 
project; spell out the many facets of project management that must be 
addressed in a project management plan; tailor the level of FTA 
oversight to the costs, complexities, and risks of a major capital 
project; set forth the means and objectives of risk assessments for 
major capital projects; and articulate the roles and responsibilities 
of FTA's PMOCs.
    After the NPRM was published, however, the Moving Ahead for 
Progress in the 21st Century Act (MAP-21) (Pub. L. 112-141) (July 6, 
2012) repealed the Fixed Guideway Modernization program, created the 
State of Good Repair program, and amended the Capital Investment Grants 
Program to add Core Capacity Improvement projects and streamline the 
New and Small Starts project development process. Moreover, MAP-21 
shifted the initiation of project management oversight to the project 
development phase and removed the statutory requirement that recipients 
of financial assistance for projects with a total cost of $1 billion 
submit an annual financial plan. Given the fundamental changes to these 
competitive and formula capital programs, FTA withdrew the NPRM (78 FR 
16460) to reexamine its proposed definition of major capital projects 
and its policy and procedures for risk assessment. Subsequently, the 
Fixing America's Surface Transportation (FAST) Act (Pub. L. 114-94) 
(December 4, 2015) further amended section 5327 to limit project 
management oversight to quarterly reviews, absent a finding that more 
frequent oversight was necessary, and mandated that the Secretary 
prescribe regulations outlining a process for at-risk recipients to 
return to quarterly reviews.
    FTA has become much more knowledgeable about the risks inherent in 
major capital projects, having conducted its own risk assessments since 
2005, witnessed some project sponsors' lack of management capacity and 
capability and appropriate project controls for some projects, and 
studied the reasons for cost and schedule changes on many major capital 
projects.

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Consequently, FTA now proposes to amend its project management 
oversight rule.
    First, this proposed rule would change the applicability of the 
regulation by shifting the definition of a ``major capital project'' 
from one based on the type of project or total project cost to one 
based on both the amount of Federal financial assistance and the total 
project cost, which FTA views as a more appropriate benchmark than the 
type of project or total capital cost of a project alone. The current 
definition of a ``major capital project'' under 49 CFR 633.5 applies to 
all construction projects for new fixed guideways or extensions of 
existing fixed guideways, regardless of project cost, and to fixed 
guideway rehabilitation and modernization projects with total project 
costs over $100 million. The NPRM applies a project cost threshold to 
all fixed guideway capital projects. As a default, the proposed rule 
raises the total project cost threshold to $300 million or more and 
requires that the project receive $100 million or more in Federal 
investment to be subject to project management oversight. Under this 
default, the number of current projects undergoing project management 
oversight would decrease by forty-nine, out of a total of eighty-eight 
major capital projects under construction, allowing FTA to focus on 
higher-risk projects.
    Second, as described in more detail below, the NPRM amends the 
regulation to bring it into compliance with recent statutory changes. 
The proposed rule limits project management oversight to quarterly 
reviews, absent a finding by FTA that a recipient requires more 
frequent oversight, and provides a process for such a recipient to 
return to quarterly reviews. Additionally, the rule applies project 
management oversight to major capital projects receiving Federal 
financial assistance under any provision of Federal law. The proposed 
changes would have no impact on safety.

II. Summary of Provisions

Section 633.1 Purpose

    This section proposes an update to reflect the mandate in 49 U.S.C. 
5327(a) to perform program management oversight of major capital 
projects for public transportation under Chapter 53 of Title 49, United 
States Code, or any other provision of Federal law.

Section 633.3 Scope

    This section proposes an update to reflect the mandate in 49 U.S.C. 
5327(a) that the regulation applies to recipients of Federal financial 
assistance undertaking a major capital project for public 
transportation under Chapter 53 of Title 49, United States Code, or any 
other provision of Federal Law.

Section 633.5 Definitions

    This section sets forth the definitions of some key terms 
applicable to this rule. FTA proposes to establish a definition for 
``project development'' and remove the definitions for ``full funding 
agreement'' and ``FT Act.'' Also, FTA proposes to amend the current 
definitions for ``fixed guideway,'' ``major capital project,'' 
``project management oversight,'' and ``recipient.''
    The current definition of a ``major capital project'' under 49 CFR 
633.5 applies to all construction projects for new fixed guideways or 
extensions of existing fixed guideways, regardless of project cost, and 
to rehabilitation and modernization projects with total project costs 
over $100 million. In this rule, FTA proposes to define a ``major 
capital project'' generally as a project to construct, expand, 
rehabilitate, or modernize a fixed guideway of $300 million or more 
that receives $100 million or more in Federal financial assistance. FTA 
believes it is more appropriate to apply the regulation to any given 
project based on the level of Federal investment in addition to total 
project cost, as opposed to the type of project or the total project 
cost alone. FTA further proposes that a project that does not meet the 
dollar-amount thresholds for the level of Federal investment and total 
project cost may be deemed a ``major capital project'' under certain 
circumstances.
    This section would amend the definition of ``fixed guideway'' to 
add passenger ferries as a qualifying public transportation facility, 
to reflect amendments made by MAP-21 to the definition of ``fixed 
guideway'' under 49 U.S.C. 5302(7). FTA proposes to add a definition 
for ``project development'' to correspond with the MAP-21 requirement 
that oversight begins in this phase, as reflected in 49 U.S.C. 
5327(d)(2)(A). The proposed changes to the remaining definitions, 
``project management oversight'' and ``recipient,'' are simply for 
clarity.

Section 633.11 Covered Projects

    This section would amend the current rule by omitting obsolete 
legal citations and extending the regulation to all major capital 
projects funded from any source under 49 U.S.C. Chapter 53 or any other 
Federal Law, as required under 49 U.S.C. 5327(a).

Section 633.13 Initiation of Project Management Oversight Services

    This section would make amendments for clarity and consistency with 
recent statutory changes. Per 49 U.S.C. 5327(d)(2)(A), project 
management oversight now begins during the project development phase 
unless the Secretary determines that it is more appropriate to begin 
the oversight during another phase of the project to maximize the 
transportation benefits and cost savings.

Section 633.15 Access to Information

    This section would make amendments for clarity.

Section 633.17 Project Management Oversight Contractor Eligibility

    This section would make amendments for clarity.

Section 633.19 Exclusion From the Project Management Oversight Program

    FTA proposes revising this section as it is no longer necessary to 
identify the administrative funding source (now in 49 U.S.C. 5338) for 
FTA to conduct project management oversight. Instead, this section 
would provide for an exclusion from the definition of ``major capital 
project'' for projects for which the Administrator determines that 
project management oversight would not benefit the Federal government 
or the recipient.

Section 633.21 Basic Requirement

    This section would make amendments for clarity and to reflect that 
oversight now begins during the project development phase of the 
project, as required under 49 U.S.C. 5327(a).

Section 633.23 FTA Review of a Project Management Plan

    This section would make amendments for clarity.

Section 633.25 Contents of a Project Management Plan

    The project management plan is critical to successful management of 
any major capital project, throughout the development and 
implementation of that project. The project management plan and its sub 
plans further enable the sponsor's staff to effectively manage the 
scope, budget, schedule, and quality of the project through a set of 
common objectives, while managing the safety and security of the 
public. This section would provide a summary to clarify that a project 
management plan is not one-size-fits-all, but rather is based on the 
complexity of the project. Further, as required under 49 U.S.C. 
5327(a), FTA

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proposes adding three additional minimum elements to the plan: Periodic 
updates of the plan, the recipient's commitment to submit a quarterly 
project budget and schedule, and safety and security management. 
Additionally, based on industry best practice, FTA proposes adding the 
management of risks, contingencies, and insurance as an element of the 
plan.

Section 633.27 Implementation of a Project Management Plan

    FTA's review and approval of a project management plan seeks to 
verify that a sponsor has all the relevant capabilities and resources 
in place to ensure successful management of the project using available 
best practices. A project management plan is a dynamic management tool 
that requires periodic updates when a project transitions from one 
phase to another, or as a result of other changes, such as turnover in 
personnel. This section would continue the requirement for regular 
reporting and clarify other requirements aimed at improving the 
management of a major capital project. Specifically, FTA's proposed 
amendments would limit oversight to quarterly reviews, as opposed to 
monthly reviews, but provide for more frequent oversight when the 
recipient fails to meet the requirements of the project management plan 
and the project is at risk of materially exceeding the budget or 
falling behind schedule. This section also would add a process for at-
risk and noncompliant projects undergoing more frequent oversight to 
return to quarterly reviews.

Section 633.29 Project Management Plan Waivers

    FTA proposes repealing this section. Instead, section 633.25 of 
this part, as amended, would provide sufficient flexibility to reflect 
FTA's practices. FTA may permit a recipient when developing a project 
management plan to incorporate applicable elements from a previously 
approved project management plan or to incorporate procedures that a 
recipient uses to manage other capital projects on a programmatic 
basis.

III. Regulatory Analyses and Notices

Executive Order 13771 (Reducing Regulation and Controlling Regulatory 
Costs)

    This proposed rule is expected to be an Executive Order 13771 
deregulatory action. Details on the estimated cost savings of this 
proposed rule can be found in the rule's economic analysis.

Executive Order 12866 (Regulatory Planning and Review), Executive Order 
13563 (Improving Regulation and Regulatory Review) and Department of 
Transportation (DOT) Regulatory Policies and Procedures

    Executive Orders 12866 and 13563 direct Federal agencies to assess 
all costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits--including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity. The 
proposed rule would amend the definition of a ``major capital project'' 
under 49 CFR part 633 by raising the total project cost threshold and 
adding a minimum Federal share, thereby reducing the number of public 
transportation projects subject to project management oversight. This 
action complies with Executive Orders 12866 and 13563 to improve 
regulation.
    FTA has determined that this rulemaking is not a significant 
regulatory action within the meaning of Executive Order 12866 and 
within the meaning of DOT regulatory policies and procedures. FTA has 
examined the potential economic impacts of this rulemaking and has 
determined that this rulemaking is not economically significant because 
it will not result in an effect on the economy of $100 million or more. 
Additionally, this proposed rule would not have an impact on another 
agency and would not materially alter the budgetary impacts of 
entitlements, grants, user fees, or loan programs. This rule would not 
raise novel legal issues.
    To calculate the benefits and annual cost savings from this 
proposed rule, FTA evaluated its project management oversight contracts 
for major capital projects from 2013 through 2018. This period was 
chosen to reflect changes to FTA's program management oversight 
procedures after MAP-21 was enacted in 2012. This period included a 
number of emergency relief program projects under 49 U.S.C. 5324 to 
repair significant damages to public transportation infrastructure 
resulting from Hurricane Sandy, which FTA also analyzed.
    Using FTA's risk evaluation tool, FTA evaluated projects in 
construction during that period based on ten key risk factors to 
produce a risk score from 0-100. Projects were then assigned a risk 
range based on the calculated score, with low-risk projects in the 
range of 0-39, medium-risk projects from 40-55, and high-risk projects 
from 56-100. This evaluation indicated that a majority of high-risk 
projects, including eighteen of the twenty-two projects in the high-
risk range, involved total project costs of over $300 million. While 
removing project management oversight from projects with total costs 
between $100 and $300 million may increase the risk of materially 
exceeding budget or falling behind schedule for some projects, there 
are currently only four high-risk projects in this range, and under the 
proposed rule, FTA may deem certain projects that do not meet the 
dollar-amount thresholds a ``major capital project'' to mitigate 
unacceptable risk. Additionally, reducing the number of lower-risk 
projects undergoing project management oversight will allow FTA to 
focus on higher-risk projects while yielding annual cost savings to FTA 
and its recipients.
    FTA calculated the average total cost of oversight for projects in 
construction during that period that would not have qualified as major 
capital projects under the default threshold of this proposed rule. FTA 
estimates that an average of 38.3 projects annually, including 
emergency relief program projects, would no longer require additional 
oversight under the default threshold.
    This proposed rule would reduce recipients' labor hours for 
oversight procedures, which include attending meetings, preparing 
quarterly reports and other requested documents, and accompanying 
contractors onto project construction sites. To estimate the potential 
cost savings for project sponsors, FTA staff examined the current 
projects in construction that would no longer qualify as major capital 
projects under the NPRM and estimated the level of effort required for 
oversight procedures. For two projects, FTA received input from 
recipients. Assuming variations in the level of effort based on the 
complexity of the project, FTA estimated that the labor hours required 
for recipients ranges from 1.7 to 2.3 times FTA's level of effort of 
approximately 39,477 hours per year for project management oversight 
procedures. Accordingly, FTA used an average factor of two and 
determined that the default threshold to qualify as a major capital 
project under the proposed rule would reduce the level of effort 
required for project sponsors by an average of 78,955 hours annually at 
a wage rate of $139.67 based on an average of the Bureau of Labor 
Statistics rate for Construction Managers and the PMOC loaded rate for 
contractors. This burden reduction would result in an annual cost 
savings to project sponsors of approximately $11 million.
    In addition, the proposed rule would reduce the level of effort 
required under

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FTA's project management oversight contracts and yield corresponding 
cost savings to FTA. Removing oversight from an average of 38.3 
projects annually would yield annual cost savings to FTA of 
approximately $8.1 million.

Regulatory Flexibility Act

    In compliance with the Regulatory Flexibility Act (Pub. L. 96-354; 
5 U.S.C. 601-612), FTA has evaluated the likely effects of the 
proposals set forth in this NPRM on small entities, and has determined 
that the NPRM would not have a significant economic impact on a 
substantial number of small entities.

Unfunded Mandates Reform Act of 1995

    FTA has determined that this rule does not impose unfunded 
mandates, as defined by the Unfunded Mandates Reform Act of 1995 (Pub. 
L. 104-4, March 22, 1995, 109 Stat. 48). This rule does not include a 
Federal mandate that may result in expenditures of $155.1 million or 
more in any 1 year (when adjusted for inflation) in 2012 dollars for 
either State, local, and tribal governments in the aggregate, or by the 
private sector. Additionally, the definition of ``Federal mandate'' in 
the Unfunded Mandates Reform Act excludes financial assistance of the 
type in which State, local, or tribal governments have authority to 
adjust their participation in the program in accordance with changes 
made in the program by the Federal Government. Federal public 
transportation law permits this type of flexibility.

Executive Order 13132 (Federalism)

    Executive Order 13132 requires agencies to assure meaningful and 
timely input by State and local officials in the development of 
regulatory policies that may have a substantial direct effect on the 
States, on the relationship between the national government and the 
States, or on the distribution of power and responsibilities among the 
various levels of government. FTA has analyzed this action in 
accordance with the principles and criteria contained in Executive 
Order 13132, and FTA determined that this action will not have a 
substantial direct effect or federalism implications on the States. FTA 
also determined that this action will not preempt any State law or 
regulation or affect the States' ability to discharge traditional State 
governmental functions.

Executive Order 12372 (Intergovernmental Review)

    The regulations effectuating Executive Order 12372 regarding 
intergovernmental consultation on Federal programs and activities apply 
to this proposed rulemaking.

Paperwork Reduction Act

    Federal agencies must obtain approval from the Office of Management 
and Budget (OMB) for each collection of information they conduct, 
sponsor, or require through regulations. FTA has analyzed this rule 
under the Paperwork Reduction Act and determined that it does not 
impose additional information collection requirements for the purposes 
of the Act above and beyond existing information collection clearances 
from OMB.

National Environmental Policy Act

    NEPA requires Federal agencies to analyze the potential 
environmental effects of their proposed actions in the form of a 
categorical exclusion, environmental assessment, or environmental 
impact statement. This proposed rulemaking is categorically excluded 
under FTA's environmental impact procedure at 23 CFR 771.118(c)(4), 
which pertains to planning and administrative activities that do not 
involve or lead directly to construction, such as the promulgation of 
rules, regulations, and directives. FTA has determined that no unusual 
circumstances exist in this instance, and that a categorical exclusion 
is appropriate for this rulemaking.

Executive Order 12630 (Taking of Private Property)

    FTA has analyzed this rule under Executive Order 12630, 
Governmental Actions and Interference with Constitutionally Protected 
Property Rights. FTA does not believe this rule effects a taking of 
private property or otherwise has taking implications under Executive 
Order 12630.

Executive Order 12898 (Federal Actions To Address Environmental Justice 
in Minority Populations and Low-Income Populations)

    Executive Order 12898, Federal Actions to Address Environmental 
Justice in Minority Populations and Low-Income Populations, and DOT 
Order 5610.2(a) (77 FR 27534) require DOT agencies to achieve 
environmental justice (EJ) as part of their mission by identifying and 
addressing, as appropriate, disproportionately high and adverse human 
health or environmental effects, including interrelated social and 
economic effects, of their programs, policies, and activities on 
minority and/or low-income populations. The DOT Order requires DOT 
agencies to address compliance with the Executive Order and the DOT 
Order in all rulemaking activities. In addition, on July 17, 2014, FTA 
issued a circular to update its EJ Policy Guidance for Federal Transit 
Recipients (www.fta.dot.gov/legislation_law/12349_14740.html), which 
addresses administration of the Executive Order and DOT Order.
    FTA has evaluated this rule under the Executive Order, the DOT 
Order, and the FTA Circular and has determined that this rulemaking 
will not cause disproportionately high and adverse human health and 
environmental effects on minority or low-income populations.

Executive Order 12988 (Civil Justice Reform)

    This action meets the applicable standards in sections 3(a) and 
3(b)(2) of Executive Order 12988 (February 5, 1996), Civil Justice 
Reform, to minimize litigation, eliminate ambiguity, and reduce burden.

Executive Order 13045 (Protection of Children)

    FTA has analyzed this proposed rulemaking under Executive Order 
13045 (April 21, 1997), Protection of Children from Environmental 
Health Risks and Safety Risks. FTA certifies that this proposed rule 
will not cause an environmental risk to health or safety that might 
disproportionately affect children.

Executive Order 13175 (Tribal Consultation)

    FTA has analyzed this action under Executive Order 13175 (November 
6, 2000), and determined that it will not have substantial direct 
effects on one or more Indian tribes; will not impose substantial 
direct compliance costs on Indian tribal governments; and will not 
preempt tribal laws. Therefore, a tribal summary impact statement is 
not required.

Executive Order 13211 (Energy Effects)

    FTA has analyzed this proposed rulemaking under Executive Order 
13211, Actions Concerning Regulations That Significantly Affect Energy 
Supply, Distribution, or Use (May 18, 2001). FTA has determined that 
this action is not a significant energy action under the Executive 
Order, given that the action is not likely to have a significant 
adverse effect on the supply, distribution, or use of energy. 
Therefore, a Statement of Energy Effects is not requirement.

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Privacy Act

    Anyone may search the electronic form of all comments received into 
any of FTA's dockets by the name of the individual submitting the 
comment, or signing the comment if submitted on behalf of an 
association, business, labor union, or any other entity. You may review 
USDOT's complete Privacy Act Statement published in the Federal 
Register on April 11, 2000, at 65 FR 19477-8.

Statutory/Legal Authority for This Rulemaking

    This rulemaking is issued under the authority of 49 U.S.C. 5327, 
which requires the Secretary to conduct oversight of major capital 
projects and to promulgate a rule for that purpose that includes a 
definition of major capital project to delineate the types of projects 
governed by the rule.

Regulation Identifier Number

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

List of Subjects in 49 CFR Part 633

    Grant programs--transportation, Mass transportation.

    Issued in Washington, DC, under authority delegated in 49 CFR 
1.90.
K. Jane Williams,
Acting Administrator.

    In consideration of the foregoing, and under the authority of 49 
U.S.C. 5327, the Federal Transit Administration proposes to amend 49 
CFR chapter VI by revising part 633, as follows:

PART 633--PROJECT MANAGEMENT OVERSIGHT

Subpart A--General Provisions
Sec.
633.1 Purpose.
633.3 Scope.
633.5 Definitions.
Subpart B--Project Management Oversight Services
633.11 Covered projects.
633.13 Initiation of project management oversight services.
633.15 Access to information.
633.17 Project management oversight contractor eligibility.
633.19 Exclusion from the project management oversight program.
Subpart C--Project Management Plans
633.21 Basic requirement.
633.23 FTA review of a project management plan.
633.25 Contents of a project management plan.
633.27 Implementation of a project management plan.
633.29 [Reserved]

    Authority: 49 U.S.C. 5327; 49 CFR 1.90.

Subpart A--General Provisions


Sec.  633.1  Purpose.

    This part implements 49 U.S.C. 5327 regarding oversight of major 
capital projects. The part provides for a two-part program for major 
capital projects receiving Federal financial assistance. First, subpart 
B discusses project management oversight, designed primarily to aid FTA 
in its role of ensuring successful implementation of federally-funded 
projects. Second, subpart C discusses the requirement that, to receive 
Federal financial assistance for a major capital project for public 
transportation under Chapter 53 of Title 49, United States Code, or any 
other provision of Federal law, a recipient must prepare a project 
management plan approved by the Administrator and carry out the project 
in accordance with the project management plan.


Sec.  633.3  Scope.

    This rule applies to a recipient of Federal financial assistance 
undertaking a major capital project for public transportation under 
Chapter 53 of Title 49, United States Code, or any other provision of 
Federal Law.


Sec.  633.5  Definitions.

    As used in this part:
    (a) Administrator means the Administrator of the Federal Transit 
Administration or the Administrator's designee.
    (b) Days means calendar days.
    (c) Fixed guideway means any public transportation facility: using 
and occupying a separate right-of-way for the exclusive use of public 
transportation; using rail; using a fixed catenary system; for a 
passenger ferry system; or for a bus rapid transit system.
    (d) FTA means the Federal Transit Administration.
    (e) Except as provided in Sec.  633.19 of this part, Major capital 
project means a project that:
    (1) Involves the construction, expansion, rehabilitation, or 
modernization of a fixed guideway that:
    (i) Has a total project cost of $300 million or more and receives 
Federal funds of $100 million or more; and
    (ii) Is not exclusively for the acquisition, maintenance, or 
rehabilitation of vehicles or other rolling stock; or
    (2) The Administrator determines to be a major capital project 
because project management oversight under this part will benefit the 
Federal government or the recipient, and the project is not exclusively 
for the acquisition, maintenance, or rehabilitation of rolling stock or 
other vehicles. Typically, this means a project that:
    (i) Involves new technology;
    (ii) Is of a unique nature for the recipient; or
    (iii) Involves a recipient whose past record indicates the 
appropriateness of extending project management oversight under this 
part.
    (f) Project development means the phase of a project after a 
locally preferred alternative has been chosen where design and 
engineering work is undertaken to advance the project from concept to a 
sufficiently mature scope to allow for the development of a reasonably 
reliable project cost, schedule, and project management plan.
    (g) Project management oversight means the risk-informed monitoring 
of the recipient's management of a major capital project's progress to 
determine whether the project is on time, within budget, in conformance 
with design and quality criteria, in compliance with all applicable 
Federal requirements, constructed to approved plans and specifications, 
delivering the identified benefits, and safely, efficiently, and 
effectively implemented.
    (h) Project management plan means a written document prepared by a 
recipient that explicitly defines all tasks necessary to implement a 
major capital project. A project management plan may be a single 
document or a series of documents or sub plans integrated with one 
another into the project management plan either directly or by 
reference for the purpose of defining how the recipient will 
effectively manage, monitor, and control all phases of the project.
    (i) Recipient means a direct recipient of Federal financial 
assistance or the sponsor of a major capital project.

Subpart B--Project Management Oversight Services


Sec.  633.11  Covered projects.

    (a) The recipient is using funds made available under Chapter 53 of 
Title 49, United States Code, or any other provision of Federal law; 
and
    (b) The project is a major capital project.

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Sec.  633.13  Initiation of project management oversight services.

    Project management oversight services will be initiated as soon as 
practicable, once the Administrator determines that this part applies. 
In most cases, this means that project management oversight will begin 
during the project development phase of the project, unless the 
Administrator determines it more appropriate to begin oversight during 
another phase of the project, to maximize the transportation benefits 
and cost savings associated with project management oversight.


Sec.  633.15  Access to information.

    A recipient for a major capital project shall provide the 
Administrator and the project management oversight contractor chosen 
under this part access to its records and construction sites, as 
reasonably may be required.


Sec.  633.17  Project management oversight contractor eligibility.

    (a) Any person or entity may provide project management oversight 
services in connection with a major capital project, with the following 
exceptions:
    (1) An entity may not provide project management oversight services 
for its own project; and
    (2) An entity may not provide project management oversight services 
for a project if there exists a conflict of interest.
    (b) In choosing private sector persons or entities to provide 
project management oversight services, the Administrator uses the 
procurement requirements in the government-wide procurement 
regulations, found at 48 CFR Chapter I.


Sec.  633.19  Exclusion from the project management oversight program.

    The Administrator may, in compelling circumstances, determine that 
a project meeting the criteria of Sec.  633.5(e)(1) of this part is not 
a major capital project because project management oversight under this 
part will not benefit the Federal government or the recipient. 
Typically, this means a project that:
    (a) Involves a recipient whose past record indicates the 
appropriateness of excluding the project from project management 
oversight under this part; and
    (b) Involves such a greater level of financial risk to the 
recipient than to the Federal government that project management 
oversight under this part is made less necessary to secure the 
recipient's diligence.

Subpart C--Project Management Plans


Sec.  633.21  Basic requirement.

    (a) If a project meets the definition of major capital project, the 
recipient shall submit a project management plan prepared in accordance 
with Sec.  633.25 of this part, as a condition of Federal financial 
assistance.
    (b)(1) The Administrator will notify the recipient when the 
recipient must submit the project management plan. Normally, the 
Administrator will notify the recipient sometime during the project 
development phase. If the Administrator determines the project is a 
major capital project after the project development phase, the 
Administrator will inform the recipient of the determination as soon as 
possible.
    d. Revise subsection (b)(2) to read as follows:
    (2) Once the Administrator has notified the recipient that it must 
submit a plan, the recipient will have a minimum of 90 days to submit 
the plan.


Sec.  633.23  FTA review of a project management plan.

    Within 60 days of receipt of a project management plan, the 
Administrator will notify the recipient that:
    (a) The plan is approved;
    (b) The plan is disapproved, including the reasons for the 
disapproval;
    (c) The plan will require modification, as specified, before 
approval; or
    (d) The Administrator has not yet completed review of the plan, and 
state when it will be reviewed.


Sec.  633.25  Contents of a project management plan.

    A project management plan must be tailored to the type, costs, and 
complexity of the major capital project, and to the recipient's 
management capacity and capability. A project management plan must be 
written to a level of detail sufficient to enable the recipient to 
determine whether the necessary staff and processes are in place to 
control the scope, budget, schedule, and quality of the project, while 
managing the safety and security of all persons. A project management 
plan must be developed with a sufficient level of detail to enable the 
Administrator to assess the adequacy of the recipient's plan.
    At a minimum, a recipient's project management plan shall include:
    (a) Adequate recipient staff organization with well-defined 
reporting relationships, statements of functional responsibilities, job 
descriptions, and job qualifications;
    (b) A budget covering the project management organization, 
appropriate contractors and consultants, property acquisition, utility 
relocation, systems demonstration staff, audits, contingencies, and 
miscellaneous payments as the recipient may be prepared to justify;
    (c) A construction schedule for the project;
    (d) A document control procedure and recordkeeping system;
    (e) A change order procedure that includes a documented, systematic 
approach to the handling of construction change orders;
    (f) A description of organizational structures, management skills, 
and staffing levels required throughout the construction phase;
    (g) Quality control and quality assurance functions, procedures, 
and responsibilities for project design, procurement, construction, 
system installation, and integration of system components;
    (h) Material testing policies and procedures;
    (i) Internal plan implementation and reporting requirements 
including cost and schedule control procedures;
    (j) Criteria and procedures to be used for testing the operational 
system or its major components;
    (k) Periodic updates of the plan, especially related to project 
budget and project schedule, financing, ridership estimates, and the 
status of local efforts to enhance ridership where ridership estimates 
partly depend on the success of those efforts;
    (l) The recipient's commitment to submit a project budget and 
project schedule to the Administrator quarterly;
    (m) Safety and security management; and
    (n) Management of risks, contingencies, and insurance.


Sec.  633.27  Implementation of a project management plan.

    (a) Upon approval of a project management plan by the Administrator 
the recipient shall begin implementing the plan.
    (b) Generally, a project management plan must be modified if the 
project is at a new phase or if there have been significant changes 
identified. If a recipient must modify an approved project management 
plan, the recipient shall submit the proposed changes to the 
Administrator along with an explanation of the need for the changes.
    (c) A recipient shall submit periodic updates of the project 
management plan to the Administrator. Such updates shall include, but 
not be limited to:
    (1) Project budget;
    (2) Project schedule;
    (3) Financing, both capital and operating;

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    (4) Ridership estimates, including operating plan; and
    (5) Where applicable, the status of local efforts to enhance 
ridership when estimates are contingent, in part, upon the success of 
such efforts.
    (d) A recipient shall submit current data on a major capital 
project's budget and schedule to the Administrator on a quarterly basis 
for the purpose of reviewing compliance with the project management 
plan, except that the Administrator may require submission more 
frequently than on a quarterly basis if the recipient fails to meet the 
requirements of the project management plan and the project is at risk 
of materially exceeding its budget or falling behind schedule. 
Oversight of projects monitored more frequently than quarterly will 
revert to quarterly oversight once the recipient has demonstrated 
compliance with the project management plan and the project is no 
longer at risk of materially exceeding its budget or falling behind 
schedule.


Sec.  633.29  [Reserved]

[FR Doc. 2019-18286 Filed 8-23-19; 8:45 am]
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