[Federal Register Volume 90, Number 216 (Wednesday, November 12, 2025)]
[Notices]
[Pages 50886-50889]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2025-19848]
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DEPARTMENT OF TRANSPORTATION
Federal Transit Administration
[FTA-2025-0068]
Notice of Availability of Final Policy Guidance for the Capital
Investment Grants Program
AGENCY: Federal Transit Administration (FTA), Department of
Transportation (DOT).
ACTION: Notice of availability of final policy guidance for the Capital
Investment Grants program.
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SUMMARY: The Federal Transit Administration (FTA) is making available
the agency's final policy guidance for the Capital Investment Grants
(CIG) program. This version amends FTA's CIG Policy Guidance published
in December 2024 and incorporates input, as appropriate, FTA received
from the public comment on its proposed Policy Guidance published in
the Federal Register in August 2025. The final guidance has been placed
in the docket and posted on the FTA website. The policy guidance
complements FTA's regulations governing the CIG program.
DATES: This final policy guidance is effective immediately. FTA will
not exempt projects from following the new amended final CIG policy
guidance.
FOR FURTHER INFORMATION CONTACT: Mark Ferroni, FTA Office of Planning
and Environment, telephone (202) 366-3233 or [email protected].
SUPPLEMENTARY INFORMATION: This final policy guidance document contains
binding obligations, which 49 U.S.C. 5334(k) defines as ``a substantive
policy statement, rule, or guidance document issued by the Federal
Transit Administration that grants rights, imposes obligations,
produces significant effects on private interests, or effects a
significant change in existing policy.'' Under 49 U.S.C. 5334(k), FTA
may issue binding obligations if it follows applicable rulemaking
procedures under 5 U.S.C. 553. Prior to making the amendments announced
today, FTA followed such procedures. The policy guidance FTA
periodically issues for the CIG program complements the FTA regulations
governing the CIG program, codified at 49 CFR part 611. The regulations
set forth the process grant applicants must follow to be considered for
discretionary grant funding under the CIG program, and the procedures
and criteria FTA uses to rate and evaluate projects to determine their
eligibility for discretionary CIG program funding. The policy guidance
provides
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a greater level of detail about the methods FTA uses and the sequential
steps a sponsor must follow in developing a project.
Pursuant to 49 U.S.C. 5309(g)(5), FTA is required to publish policy
guidance for the CIG program each time the agency makes significant
changes to the review and evaluation process and criteria, but not less
frequently than once every two years. In August 2025, FTA published a
notice in the Federal Register (90 FR 40465) seeking comment on
proposed changes to FTA's CIG Policy Guidance issued in December 2024
(89 FR 102248). The amended Final CIG program policy guidance is being
made available today on the agency's public website at https://www.transit.dot.gov/funding/grant-programs/capital-investments/capital-investment-grants-program-regulations-guidance, and in the docket at
https://www.regulations.gov/docket/FTA-2025-0068. Companion documents
to the CIG Policy Guidance such as reporting instructions, CIG
reporting templates, and standard cost category worksheets will be
updated and will also be posted on the FTA website at a future date.
Until such time, project sponsors should continue to use the reporting
instructions, CIG reporting templates, and standard cost category
worksheets dated January 2025.
Response to Comments
FTA received comments from 16 respondents on the proposed policy
guidance for the CIG program. Four of the 16 respondents were transit
agencies. FTA received six comments from interest groups or policy
organizations, five comments from individuals, and one comment from an
anonymous respondent. One of the comments was submitted to a separate
docket for FTA's Request for Information Concerning the Capital
Investment Grants Program (FTA-2025-0069). FTA is partially responding
to that comment in this Notice because a portion of the comment relates
to FTA's environmental benefits proposal.
Environmental Benefits
Regarding the proposed changes to the calculation of environmental
benefits in the proposed policy guidance, roughly half of the 16
respondents supported the change. Many of these commenters expressed
support for the proposed methodology, stating it would result in a
simpler and more streamlined evaluation of environmental benefits,
reduce administrative burden, and expedite the CIG process. Some
commenters specifically criticized the existing vehicle miles traveled
(VMT)-based methodology, noting it is complex, subject to varied
interpretations, data-intensive, complicated, and burdensome. One of
these commenters additionally requested FTA continue working with the
industry in the future regarding the environmental benefits
methodology. Two of these commenters argued the proposed methodology
would capture air quality improvements and reduced emissions without
the need to use a complex methodology. An additional commenter
supported the removal of the social cost of carbon, arguing the metric
is deeply flawed and artificially inflates the dollar value of reducing
greenhouse gas emissions. It also noted the underlying statute
governing the CIG program does not require consideration of carbon
emissions or the social cost of carbon.
Two commenters requested FTA modify its proposal by assigning a
``Medium-High'' rating for projects located in areas formerly
designated as nonattainment but that have since achieved attainment
through local planning and policy decisions, suggesting FTA should
reward projects in such areas. One of these commenters stated it
nevertheless supported FTA's measure as proposed, as it believed
resolution of the issue may stand in the way of FTA allocating CIG
funding and making funding recommendations in the FY26 CIG report to
Congress.
Response: FTA appreciates the comments supporting the proposal and
agrees the new methodology will reduce burden and complexity for
project sponsors. We agree with the suggestion to work with the
industry in the future to ``capture the specific environmental benefits
of public transportation projects'' without unduly burdening project
sponsors with overly complex analysis. To clarify, however, FTA is not
adopting the suggestion to assign a ``Medium-High'' rating for
maintenance areas (i.e., areas formerly designated nonattainment but
have since achieved attainment) as suggested because FTA proposed to
assign a ``High'' rating to such areas. The proposed methodology
therefore already rewards areas formerly in nonattainment and that have
since achieved attainment.
Of the multiple respondents in support of the change, one
respondent suggested FTA clarify in the final policy guidance how a
project will be rated when a project crosses more than one geographic
area which may have varying air quality designations. The commenter
requested FTA clarify that projects located either wholly or partially
within maintenance or nonattainment areas will receive a ``High''
rating for the environmental benefits criterion.
Response: FTA agrees with this commenter because we recognize that
an eligible CIG project may traverse areas with different air quality
designations, perhaps by crossing urban area boundaries or even State
lines. This might create confusion as to which specific air quality
designation will be applied. In response, FTA will modify the
environmental benefits measure language in the CIG Policy Guidance to
read as follows:
Measure
FTA evaluates and rates the environmental benefits criterion for
New Starts projects based on the EPA air quality designation given to
the geographic area(s) in which the project is located for the
transportation-related criteria pollutants, carbon monoxide (CO),
nitrogen dioxide (NO2), ozone (O3) (2015
standard), and particulate matter (PM2.5) (2012 standard).
This information is readily obtained from the EPA Green Book (https://www.epa.gov/green-book). Projects located wholly or partially in areas
designated as nonattainment or maintenance for any of the four criteria
pollutants will receive a High rating, and projects located wholly in
areas designated as attainment in all four criteria pollutants will
receive a Medium rating.
About half of the 16 commenters opposed FTA's proposal, one of whom
expressed general opposition without providing a reason. Some
commenters voiced concerns about the removal of the social cost of
carbon, including concerns the change would negatively affect the
evaluation of environmental impacts and that the social cost of carbon
was an important metric to include in the analysis. One commenter
opposed the elimination of VMT-based metrics, noting VMT is a valuable
measure of the cost-effectiveness of a proposed project.
Response: FTA disagrees with these commenters because the social
cost of carbon calculation is complex and depends heavily on assumed
unit values, some of which are arbitrary and may vary over time. There
is not consistent agreement that the social cost of carbon is a
reliable metric in climate policy. The use of the social cost of carbon
measure may lead to unsubstantiated policy decisions, which exceeds the
marginal practical benefit of using the social cost of carbon in rating
CIG projects. In addition, FTA disagrees that the VMT-based metric
should be retained to measure the cost-effectiveness of a project. The
cost-benefit of a CIG project is already
[[Page 50888]]
captured in the collective evaluation of all six Project Justification
criteria, one of which is cost-effectiveness.
One of the commenters opposed to the proposal provided legal
arguments in support of opposing the proposal. First, the commenter
argued the statute governing the CIG program at 49 U.S.C.
5309(d)(2)(A)(iii), (e)(2)(A)(iv), and (h)(4) requires FTA to conduct a
``comprehensive review'' of the environmental effects of the project.
It stated further that for Core Capacity Projects, 49 U.S.C.
5309(e)(2)(B) requires FTA to evaluate, analyze, and consider whether
the project will improve environmental outcomes, and that for Small
Starts Projects, 49 U.S.C. 5309(h)(4) requires FTA to analyze,
evaluate, and consider environmental benefits as compared to a no-
action alternative. The commenter contended FTA's proposal falls short
of these statutory requirements because it would entail an
oversimplified analysis requiring no ``real analytical work'' on the
part of FTA.
Response: FTA disagrees its proposed approach is inconsistent with
statute. As detailed in FTA's CIG policy guidance, FTA conducts a
comprehensive project justification evaluation during the entry to
engineering and construction grant phases, as applicable, of the
proposed CIG project. This assessment gives due consideration to all
six project justification criteria required by statute to determine a
project's overall project justification rating comprehensively.
The commenter mischaracterizes the statutory requirements regarding
FTA's CIG project justification evaluation. Sections 49 U.S.C.
5309(d)(2)(A)(iii), (e)(2)(A)(iv), and (h)(4) do not require FTA to
evaluate a project's environmental ``effects,'' but rather its
environmental ``benefits.'' Environmental effects are comprehensively
addressed through the National Environmental Policy Act (NEPA) (42
U.S.C. 4321 et seq.) process which, by statute, must be satisfied
during the Project Development stage of a CIG project (49 U.S.C.
5309(d)(2)(A), (e)(2)(A), and (h)(2)(B)).
The proposed methodology utilizing the EPA's National Ambient Air
Quality Standards (NAAQS) designation serves as a basis for FTA to
evaluate, analyze, and consider the environmental benefits of the
applicable CIG project appropriately. One of the most distinguishable
environmental benefits of public transportation is a reduction in
transportation-related criteria pollutants under the Clean Air Act.
FTA's proposed methodology assigns a higher rating to projects located
in nonattainment areas, which have lower air quality as determined by
the transportation-related criteria pollutants, carbon monoxide (CO),
nitrogen dioxide (NO2), ozone (O3), or
particulate matter (PM2.5), and therefore are areas where
reduced criteria pollutant emissions would be most beneficial. This
methodology addresses and compares the environmental benefits to a no-
action alternative because the non-attainment designation for the area
provides the baseline for the no-action alternative: unacceptable
levels of one or more criteria pollutants. The addition of transit
projects shifts users from personal automobiles to public
transportation systems, which accordingly leads to a reduction in
transportation-related criteria pollutants.\1\ As noted by other
commenters in this docket, this methodology effectively identifies
proposed projects expected to improve environmental outcomes without
engaging in a burdensome and overly complex analysis.
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\1\ See, e.g., Congressional Budget Office, ``Emissions of
Carbon Dioxide in the Transportation Sector,'' https://www.cbo.gov/publication/58861.
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Second, the commenter argued FTA's proposal is not supported by
evidence, stating FTA has not provided sufficient justification for why
assessing a project's NAAQS designation is relevant for the evaluation
of the project's environmental benefits and has not provided evidence
of project sponsors having difficulty with VMT calculations. The
commenter stated further that comments on FTA's 2024 proposed CIG
policy guidance requesting a simplified environmental benefits process
specifically sought priority for electric vehicle fleets, and FTA's
proposal would not achieve this.
Response: FTA disagrees the proposal is not supported by evidence,
and it discusses the relevance of the NAAQS designation in the response
above. As explained in its proposal, FTA proposed reverting to a
previous methodology FTA utilized before 2013. FTA has years of
experience implementing both methodologies and, after thorough
consideration, has determined the VMT-based methodology is
unnecessarily burdensome and complex. As FTA further explained, the
proposal was also informed by comments received on FTA's April 2024 CIG
policy guidance, which are publicly available in the corresponding
docket. Several of these comments expressed frustration with the
complexity and difficulty of applying the current environmental
benefits measure and voiced a desire for FTA to simplify it. FTA's
proposal is responsive to those concerns. In addition, as discussed
above, several comments in this docket noted the VMT-based calculation
is overly complex, burdensome, and subject to differing
interpretations. FTA agrees with these commenters and believes the
proposed methodology achieves an appropriate balance of capturing
environmental benefits and reducing complexity and burden.
Finally, the commenter urged FTA to continue utilizing a social
cost of greenhouse gas measure because removal of this metric leaves no
method for calculating climate change impacts, further arguing FTA is
required by statute to analyze this factor. The commenter noted that
although the Interagency Working Group's (IWG) social cost of carbon
measure was withdrawn by Executive Order, alternative measures remain
available, such as social cost of carbon estimates from the
Environmental Protection Agency (EPA).
Response: FTA disagrees that modifying the methodology is contrary
to statute. The statute does not require consideration of ``climate
change.'' The statute requires consideration of a project's
``environmental benefits'' which, as discussed above, FTA would achieve
through its proposed methodology.
As explained in FTA's proposal, this change is consistent with the
direction in Executive Order (E.O.) 14154, ``Unleashing American
Energy,'' OIRA's ``Guidance Implementing Section 6 of Executive Order
14154, Entitled `Unleashing American Energy,' '' (OIRA's Guidance), and
DOT Order 2100.7, ``Ensuring Reliance Upon Sound Economic Analysis in
Department of Transportation Policies, Programs, and Activities.''
Section 6(b) of E.O. 14154 withdraws guidance issued by the Interagency
Working Group (IWG), including the Technical Support Document of
February 2021, as it is no longer representative of governmental
policy. Further, Section 6(c) of E.O. 14154 and DOT Order 2100.7 state
the ``calculation of the `social cost of carbon' is marked by logical
deficiencies, a poor basis in empirical science, politicization, and
the absence of a foundation in legislation.'' OIRA's Guidance also
limits applying the social cost of carbon to uses where it is
statutorily required and directs agencies to remove its consideration
from discretionary regulatory language ``as quickly as feasible.''
FTA is adopting the proposed methodology for evaluating
environmental benefits, with the one modification in response to
comments
[[Page 50889]]
to clarify how projects that cross more than one geographic area will
be rated, as discussed above.
Urgent Care Facilities
Six respondents commented on the proposal to remove urgent care
facilities from the access to essential services measure under the CIG
land use criterion. One commenter expressed concern about removing the
consideration of urgent care centers generally. Two commenters
supported the proposal, given the Homeland Infrastructure Foundational-
Level Data (HIFLD) on urgent care centers is no longer available. Two
commenters noted that after FTA published its proposal, the Department
of Homeland Security (DHS) announced the discontinuation of the entire
HIFLD data set. These commenters noted that access to essential
services is still a valuable measure and suggested FTA use the United
States Census Bureau's North American Industry Classification System
(NAICS) to identify essential services in a project corridor for future
grant cycles. One commenter supported the removal of urgent care
centers from the evaluation but requested FTA modify the corresponding
breakpoints because removing urgent care centers would result in fewer
average essential services per station area.
Response: FTA appreciates the comments acknowledging the HIFLD data
has been discontinued since FTA published its proposal in the Federal
Register. As noted in the HIFLD website (https://hifld-geoplatform.hub.arcgis.com/pages/a6a99fd33af64ed9bc51e55760123a82), DHS
has made available a crosswalk spreadsheet providing a list of affected
layers and links. Because the HILFD data are no longer available, it
would be challenging at this time for FTA to evaluate potential changes
to the current breakpoints. We therefore decline to adopt revised
breakpoints, as suggested. FTA further notes that urgent care centers
were one of five types of facilities in the access to essential
services element rating, the access to essential services element is
one of five measures in the land use criterion rating, and land use is
one of six project justification criteria. This results in essential
services making up 1.67 percent of an Overall Project Rating of 100
percent. FTA will look further into the NAICS data set to see if it can
be incorporated into future policy guidance revisions. Until such time,
FTA is adopting the removal of urgent care facilities from the access
to essential services element under the land use criterion as proposed.
Given the loss of the data source there is no way project sponsors can
comply with the reporting instructions if FTA does not do so.
Other Comments
Two comments were outside the scope of the proposal. These included
a request for FTA to explore other opportunities to streamline and
improve the CIG process and one comment voicing concern about the cost
of transit projects in general.
Response: FTA appreciates the comments but notes they are outside
the scope of the proposal. Accordingly, FTA is not responding to them
in this Notice.
Two commenters urged FTA to finalize the proposed policy guidance
quickly, due to the need for FTA to move forward with CIG project
ratings, allocate CIG funding, and make project recommendations for the
FY26 CIG Annual Report to Congress.
Response: FTA appreciates the commenters' understanding of the need
to advance the rating and funding recommendation process to ensure
projects which are ready to advance and receive construction grants are
able to do so to meet the needs of their communities. FTA agrees with
this need and is therefore adopting this guidance with an immediate
effective date.
Good Cause for Immediate Effective Date
Pursuant to 49 U.S.C. 5334(k), FTA must follow applicable
rulemaking procedures under section 553 of the Administrative Procedure
Act (APA), 5 U.S.C. 551, et seq., before issuing a statement imposing a
binding obligation on recipients. The APA generally requires
publication or service of a substantive rule not less than 30 days
before its effective date except ``as otherwise provided by the agency
for good cause found and published with the rule.'' 5 U.S.C. 553(d)(3).
In accordance with 5 U.S.C. 553(d)(3), FTA finds good cause to
publish this guidance with an immediate effective date because a 30-day
delayed effective date would significantly impair FTA's ability to
execute its statutory duties with respect to the CIG program. Due to
the revocation of estimates of the social cost of carbon by E.O. 14154,
FTA is unable to evaluate the environmental benefits of CIG projects,
as required by 49 U.S.C. 5309(d), (e), and (h), until the CIG Policy
Guidance goes into effect. Accordingly, further delaying the effective
date of the guidance would impede FTA's ability to complete CIG project
ratings, report funding recommendations, and allocate CIG funding as
quickly as possible. Without completing such ratings, FTA is unable to
publish funding recommendations in the FY26 CIG annual report to
Congress, as required by 49 U.S.C. 5309(o)(1)(B). A delayed effective
date therefore would seriously impede FTA's ability to comply with its
statutory obligations in a timely manner. An immediate effective date
is further supported by commenters requesting FTA act quickly to
finalize the policy guidance, as discussed in the Response to Comments
above.
Executive Order 14192 (Deregulatory Action)
E.O. 14192 (``Unleashing Prosperity Through Deregulation'')
requires for ``each new [E.O. 14192 regulatory action] issued, at least
10 prior regulations be identified for elimination.'' This final rule
is considered an E.O. 14192 deregulatory action with unquantified cost
savings resulting from more streamlined evaluation of environmental
benefits, reduce administrative burden, and an expedited CIG process.
Marcus J. Molinaro,
Administrator.
[FR Doc. 2025-19848 Filed 11-10-25; 8:45 am]
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