INTRODUCTION TO FEDERAL HIGHWAY FUNDING AND ELIGIBILITY Steve

INTRODUCTION TO FEDERAL HIGHWAY FUNDING AND ELIGIBILITY Steve Baumann Financial Specialist (503) 587 -4729

EXPECTATIONS • Characteristics of the FAHP • Legislation • Responsibilities • Major funding requirements • Discretionary – Earmarked funds

Characteristics of the Federal-Aid Highway Program Ø Ø Ø State Administered, Federal Stewardship Funding tied to specific “systems” Requires States to have Highway Agency or locals to have responsible individual States/locals pay for routine maintenance Matching requirements Reimbursable program

Federal, State and Local Relationship Federal Responsibilities Review and approve state/local proposals Develop regulations and guidance Promulgate standards Provide technical assistance State DOT Apportionment or Allocation Distribute line of credit Reimburse States their eligible expenses

Federal, State and Local Relationship State and Local Responsibilities Ø Conceive, prioritize, plan, design, and construct projects Ø Maintain and operate highways

Safe, Accountable, Flexible, Effient Transportation Equity Act –A Legacy for Users (SAFETEA-LU) Ø Highways, highway safety, transit Ø 5 -year legislation - 2005 -2009 Ø Signed into law August 10, 2005 (P. L. 109 -59) Ø $244 billion authorized over 5 years Ø (12% increase over TEA-21) Ø Highways - $193 billion Ø Transit - $51 billion

Highway Trust Fund SAFETEA-LU of 2005 Ø Extended authorization for FY 2005 -2009 Ø Extended HTF through FY 2011 Ø Congress added eight billion with hopes of getting through 2009

Obligations Ø State Request, Federal Approval Ø Commits State’s Line of Credit Ø Commits Federal Government to Reimburse State ØBased on Estimates ØProtects Funds from Lapsing ØTraditional Point of Budgetary Control

Obligation Limitation (Obligation Ceiling) What is it? Ø A budgetary mechanism to control Federal spending Who does it? Ø Congress -- through legislation Why? Ø To be responsive to current budget policies

Obligation Limitation Characteristics Oct 2000 State-by-State Limit 1 Sept 2001 Applies 30 Good for 1 Year Total to Program

Reimbursement Contractor does work A c t i o n s LPA pays Contractor State pays contractor State pays LPA State submits voucher to FHWA sends to Treasury Treasurer wires money to State Time FHWA sends to Treasury Treasurer wires money to State

Functional Classification Eligibility for Federal Financial Assistance Interstate - 1% (Included in NHS %) NHS - 4% Local - 76% Ineligible Other - 20% Eligible Out of 3. 9 million miles of roads in the U. S. , less than 1 million miles are eligible for federal financial assistance.

General Eligibility Roadways eligible for Federal-aid funding: • publicly owned and open to public • be functional classified higher than rural minor collectors or local roadways • meet the requirements of the specific Federal funding program

General Categories of Federal-aid Funds Interstate Maintenance (IM) Ø National Highway System (NHS) Ø Surface Transportation Program (STP) Ø Highway Bridge Program Ø Congestion Mitigation & Air Quality (CMAQ) Ø Emergency Relief Ø Discretionary Programs Ø Earmarked Projects Ø

Discretionary Ø Division office authorization Ø Apply (subsequent FHWA approval)

Discretionary Ø Corridors & Borders ØInnovative Bridge Research and Construction ØNational Historic Covered Bridge Program ØPublic Lands Highways ØFerry Boats ØScenic Byways ØTransportation and Community and System Preservation Pilot Program (TCSP) ØHighways for Life ØTruck Parking, and Value Pricing

Earmarked Funds ØLaw may define eligible activities ØReverts to program requirements ØWritten in law ØLaw makes funds available ØDoes NOT authorize project!!! ØMay have to apply (discretionary) ØNeeds FHWA authorization ØMay not get all of funds, or in one year!

LPA Advertising for Bids “THOU SHALT HAVE AN FHWA AUTHORIZATION IN THY HANDS PRIOR TO ADVERTISING FOR BIDS” (or spending any money)

Local Responsibilities and Expectations for LPA projects l l l Knowledge of Federal-aid requirements ODOT/Local Partnership: early, continuous communication and coordination needed. ODOT/LPA knowledge of what is happening on LPA projects (funding, work progress, inspections, etc)

Local Responsibilities and Expectations for LPA projects l l ODOT provides oversight of Local Agencies and is not relieved of its responsibilities for LPA projects’ compliance with Federal regulations Certification program allow LPAs to use their own procedure, forms, etc. , but does not relieve them or ODOT of the responsibility to comply with all Federal and State regulations and laws