Guidance on New Starts Policies and Procedures and FY 2008 New Starts Reporting

Guidance on New Starts Guidance on New Starts Policies Policies

and Proceduresand Proceduresandand

FY 2008 New Starts FY 2008 New Starts ReportingReporting

May 22 Federal Register May 22 Federal Register Notice Notice

Notice of Availability - May 16 Policy Notice of Availability - May 16 Policy GuidanceGuidance

Response to Comments on Draft GuidanceResponse to Comments on Draft Guidance Notice of Availability - New Starts Notice of Availability - New Starts

Reporting Instructions and FY 2008 Reporting Instructions and FY 2008 Evaluation ProcessEvaluation Process

Schedule for FY 2008 New Starts Schedule for FY 2008 New Starts ReportingReporting

SAFETEA-LU Says……SAFETEA-LU Says…… Section 3011(d)(6) requires that FTA Section 3011(d)(6) requires that FTA

publish, for comment and response, Policy publish, for comment and response, Policy GuidanceGuidance

180 days after enactment of SAFETEA-LU180 days after enactment of SAFETEA-LU Each time significant changes are made to the Each time significant changes are made to the

process/criteriaprocess/criteria At least every two yearsAt least every two years

FTA’s Response……..FTA’s Response…….. January 19, 2005 Proposed GuidanceJanuary 19, 2005 Proposed Guidance 60 day (plus additional week) comment period 60 day (plus additional week) comment period 2-day working session w/ APTA Policy and 2-day working session w/ APTA Policy and

Planning CommitteePlanning Committee May 16 Final GuidanceMay 16 Final Guidance

Changes Proposed Changes Proposed in Draft Guidancein Draft Guidance

NEPA/New Starts InterfacesNEPA/New Starts Interfaces NEPA ScopingNEPA Scoping New Starts Information in NEPA DocumentsNew Starts Information in NEPA Documents Acceptable New Starts Rating for Issuance of NEPA Final Acceptable New Starts Rating for Issuance of NEPA Final

Doc/Decision Doc/Decision Before and After Study DocumentationBefore and After Study Documentation Expanded Certification of Methods and AssumptionsExpanded Certification of Methods and Assumptions Uncertainty in Costs and Ridership ForecastsUncertainty in Costs and Ridership Forecasts Project Development AgreementsProject Development Agreements FFGA New Starts Level Set at Final Design FFGA New Starts Level Set at Final Design

ApprovalApproval Consideration of Rules for Use of Mode-Specific Consideration of Rules for Use of Mode-Specific

Constants Constants

Changes Adopted Changes Adopted in Final Guidancein Final Guidance

NEPA/New Starts InterfacesNEPA/New Starts Interfaces NEPA ScopingNEPA Scoping New Starts Information in NEPA DocumentsNew Starts Information in NEPA Documents

Acceptable New Starts Rating for Issuance of NEPA Final Doc/Decision Acceptable New Starts Rating for Issuance of NEPA Final Doc/Decision ** Before and After Study DocumentationBefore and After Study Documentation

Expanded Certification of Methods and AssumptionsExpanded Certification of Methods and Assumptions** Uncertainty in Costs and Ridership ForecastsUncertainty in Costs and Ridership Forecasts Project Development AgreementsProject Development Agreements FFGA New Starts Level Set at Final Design FFGA New Starts Level Set at Final Design

ApprovalApproval Consideration of Rules for Use of Mode-Specific Constants Consideration of Rules for Use of Mode-Specific Constants

plusplus

Clarification of Cost Effectiveness BreakpointsClarification of Cost Effectiveness Breakpoints Contractor Performance ReportContractor Performance Report

NEPA Scoping Prior to NEPA Scoping Prior to PE PE

““Require a project to have progressed Require a project to have progressed beyond the NEPA scoping phase before beyond the NEPA scoping phase before entering preliminary engineering”entering preliminary engineering”

Rationale Rationale Confirmation of the LPA / “PE project” Confirmation of the LPA / “PE project” Mitigates against having to do “planning” Mitigates against having to do “planning”

during PEduring PE Strengthens linkage between NEPA and Strengthens linkage between NEPA and

New StartsNew Starts

NEPA Scoping Prior to NEPA Scoping Prior to PE PE

Comments - Fairly evenly distributed Comments - Fairly evenly distributed between supporters and opponentsbetween supporters and opponents Concern that requiring scoping will Concern that requiring scoping will

prolong project development, increase prolong project development, increase costscosts

Subjecting the LPA to scoping is Subjecting the LPA to scoping is confusing to the publicconfusing to the public

Policy Guidance Implements this Policy Guidance Implements this RequirementRequirement

New Starts Information New Starts Information in NEPA Documentsin NEPA Documents

““Require the EIS to present the New Require the EIS to present the New Starts evaluation of the preferred Starts evaluation of the preferred alternative, in addition to NEPA alternative, in addition to NEPA evaluation of the alternatives”evaluation of the alternatives”

RationaleRationale Supports CEQ regulations 40 CFR 1502.23Supports CEQ regulations 40 CFR 1502.23 Provides public and stakeholders with Provides public and stakeholders with

information on the likelihood of receiving information on the likelihood of receiving New Starts fundingNew Starts funding

Enhances information available for Enhances information available for decisionmakingdecisionmaking


Comments – majority opposed Comments – majority opposed May compromise NEPA process and May compromise NEPA process and

expose FTA to litigation expose FTA to litigation New Starts information is too confusing New Starts information is too confusing

to the public to the public Should be subject to rulemakingShould be subject to rulemaking

Policy Guidance Implements this Policy Guidance Implements this Requirement, with ModificationRequirement, with Modification


Applies to both EAs and EIS’sApplies to both EAs and EIS’s For LPA; FTA strongly encourages for all For LPA; FTA strongly encourages for all

alternatives in AA/DEIS’salternatives in AA/DEIS’s FTA has standard language/format for FTA has standard language/format for

presenting information and explaining how presenting information and explaining how it is usedit is used

Most recent rating would be reported, so Most recent rating would be reported, so long as information in document is long as information in document is consistent w/rating (new rating not always consistent w/rating (new rating not always necessary)necessary)

Study/project sponsors should work w/FTA Study/project sponsors should work w/FTA to clarify New Starts criteria and evaluation to clarify New Starts criteria and evaluation process for public and decisionmakersprocess for public and decisionmakers

New Starts Project Achieve an New Starts Project Achieve an Acceptable Rating Before NEPA Acceptable Rating Before NEPA

Final Doc/DecisionFinal Doc/Decision ““Require a New Starts project to achieve an Require a New Starts project to achieve an

acceptable New Starts rating before the acceptable New Starts rating before the FEIS, ROD, or FONSI is signed”FEIS, ROD, or FONSI is signed”

RationaleRationale Low rating = no New Starts funding recommendation = Low rating = no New Starts funding recommendation =

no Federal actionno Federal action Scope changes should be addressed within the NEPA Scope changes should be addressed within the NEPA

processprocess Final NEPA document must present a project that FTA Final NEPA document must present a project that FTA

can fund. can fund. FTA cannot issue a final NEPA document knowing that FTA cannot issue a final NEPA document knowing that

its supplementation or reevaluation of scope change is its supplementation or reevaluation of scope change is mandatory mandatory

New Starts Project Achieve an New Starts Project Achieve an Acceptable Rating Before NEPA Acceptable Rating Before NEPA

Final Doc/DecisionFinal Doc/Decision Comments – significant oppositionComments – significant opposition

Could prejudice the NEPA processCould prejudice the NEPA process NEPA delays could: NEPA delays could:

Delay ROW acquisition, which could result in cost Delay ROW acquisition, which could result in cost escalationescalation

Prohibit project from securing, and/or advancing in Prohibit project from securing, and/or advancing in development with, other fundingdevelopment with, other funding

Should be subject to rulemakingShould be subject to rulemaking

Policy Guidance Does Not Implement this Policy Guidance Does Not Implement this Requirement, Except Where Supplemental Requirement, Except Where Supplemental NEPA Documentation is CertainNEPA Documentation is Certain For all other projects, RODS/FONSIs to include a “New Starts For all other projects, RODS/FONSIs to include a “New Starts

Finding” Finding”

Preservation of Information Preservation of Information for Before and After Studyfor Before and After Study

““Require project sponsors to provide Require project sponsors to provide documentation of the information produced documentation of the information produced during alternatives analysis that will be needed during alternatives analysis that will be needed for the required B and A study, when they apply for the required B and A study, when they apply to begin PE, as well as updated information and to begin PE, as well as updated information and analyses at the time of the request to enter into analyses at the time of the request to enter into final design and before executing an FFGA”final design and before executing an FFGA”

RationaleRationale Ensures the availability of data for subsequent B and Ensures the availability of data for subsequent B and

A studyA study Consistent with FTA objectives for review of AA Consistent with FTA objectives for review of AA

technical informationtechnical information ““Real time” rather than retrospective analysisReal time” rather than retrospective analysis Consistent with Congressional intent Consistent with Congressional intent

Preservation of Information Preservation of Information for Before and After Studyfor Before and After Study

Comments – generally supportiveComments – generally supportive More guidance and training is necessaryMore guidance and training is necessary Costs of conducting the BnA Study should be an Costs of conducting the BnA Study should be an

eligible expenseeligible expense Economic development and land use should be Economic development and land use should be

required characteristics of the BnA Studyrequired characteristics of the BnA Study Policy Guidance Implements this Policy Guidance Implements this

RequirementRequirement Project sponsors should identify the contractor Project sponsors should identify the contractor

responsible for cost and ridership estimates and responsible for cost and ridership estimates and describe contractor’s role (in support of FTA describe contractor’s role (in support of FTA contractor assessment report)contractor assessment report)

Certification of Methods, Certification of Methods, Assumptions and Assumptions and

ProceduresProcedures ““Require that the individuals identified on Require that the individuals identified on

Template 1 as the person responsible for Template 1 as the person responsible for developing these tools and techniques, in developing these tools and techniques, in addition to the CEO, certify that they have been addition to the CEO, certify that they have been properly developed and applied according to properly developed and applied according to professional standards and conventions and FTA professional standards and conventions and FTA guidelines”guidelines”

RationaleRationale Improve the reliability of technical information used to Improve the reliability of technical information used to

support decisionmaking and justification for New Starts support decisionmaking and justification for New Starts projectsprojects

Better ensure “level playing field” for FTA’s evaluation Better ensure “level playing field” for FTA’s evaluation of candidate projectsof candidate projects

Consistent with Congressional intent Consistent with Congressional intent

Certification of Methods, Certification of Methods, Assumptions and Assumptions and

ProceduresProcedures Comment – Significant oppositionComment – Significant opposition

No one individual can be identified as No one individual can be identified as responsible for work.responsible for work.

Risk of professional liability and Federal Risk of professional liability and Federal prosecution.prosecution.

No industry-accepted standards.No industry-accepted standards. FTA reviews obviate the need for certificationFTA reviews obviate the need for certification..

Policy Guidance Does Not Implement Policy Guidance Does Not Implement this Requirement this Requirement Modest update to long-standing certification Modest update to long-standing certification

statementstatement

Identification of Identification of Uncertainties in Costs and Uncertainties in Costs and

Ridership ForecastsRidership Forecasts ““Require forecasts of costs and benefits Require forecasts of costs and benefits

to include an analysis of uncertainties”to include an analysis of uncertainties” RationaleRationale

Responds to SAFETEA-LU emphasis on Responds to SAFETEA-LU emphasis on reliability of estimates of costs and benefitsreliability of estimates of costs and benefits

Supports requirement for Contractor Supports requirement for Contractor Performance Assessment reportingPerformance Assessment reporting

Acknowledges elements of uncertainties for Acknowledges elements of uncertainties for strengthening decisionmaking and focusing strengthening decisionmaking and focusing project development activitiesproject development activities

Identification of Identification of Uncertainties in Costs and Uncertainties in Costs and

Ridership ForecastsRidership Forecasts Comments – Generally opposed, seeking more Comments – Generally opposed, seeking more

clarificationclarification All risk can never be eliminated and so too great a focus All risk can never be eliminated and so too great a focus

on it is not productiveon it is not productive FTA should delay implementation of this requirement FTA should delay implementation of this requirement

until guidance is issued that defines how uncertainties until guidance is issued that defines how uncertainties should be characterizedshould be characterized

Unclear how uncertainties would be presented for cost Unclear how uncertainties would be presented for cost effectivenesseffectiveness

Policy Guidance Does Not Implement this Policy Guidance Does Not Implement this RequirementRequirement FTA will issue guidance on reporting of risks and FTA will issue guidance on reporting of risks and

uncertainties at a later dateuncertainties at a later date In interim, sponsors strongly encouraged to report In interim, sponsors strongly encouraged to report

uncertainties uncertainties

Project Development Project Development AgreementsAgreements

““At FTA’s discretion, selectively require At FTA’s discretion, selectively require project development agreements (at project development agreements (at time of PE and/or FD approval)”time of PE and/or FD approval)”

RationaleRationale Provides mutually agreed upon yardstick Provides mutually agreed upon yardstick

for measuring progress in project for measuring progress in project developmentdevelopment

Focuses project sponsors effort/FTA Focuses project sponsors effort/FTA oversight upon principal issuesoversight upon principal issues

Provides basis for FTA rescission of PE/FD Provides basis for FTA rescission of PE/FD approvalapproval

Project Development Project Development AgreementsAgreements

Comments – Some support, but majority Comments – Some support, but majority requested further informationrequested further information When required? What criteria would be used to When required? What criteria would be used to

determine if necessary?determine if necessary? Concern that PDA’s, at FTA’s discretion, could result Concern that PDA’s, at FTA’s discretion, could result

in inequitable treatment of projectsin inequitable treatment of projects PDAs will delay projectsPDAs will delay projects Could be partnering agreements, if not used Could be partnering agreements, if not used

punitivelypunitively Existing procedures are already in place to achieve Existing procedures are already in place to achieve

PDA objectivesPDA objectives Policy Guidance Does Not Implement Policy Guidance Does Not Implement

this Requirementthis Requirement PDAs will be developed and executed when mutually PDAs will be developed and executed when mutually

agreeableagreeable

New Starts Funding Level New Starts Funding Level Set at Final Design Set at Final Design

ApprovalApproval ““Place a cap on the FFGA New Place a cap on the FFGA New

Starts funding amount at the point of Starts funding amount at the point of approval to enter final design”approval to enter final design”

RationaleRationale Consistent with Congressional intentConsistent with Congressional intent Clarifies FTA participation in project Clarifies FTA participation in project

costscosts Supports decisionmakingSupports decisionmaking


ApprovalApproval Comments – Slight majority opposition, but some Comments – Slight majority opposition, but some

support and some suggested alternativessupport and some suggested alternatives Concern that approach would inhibit innovative contractingConcern that approach would inhibit innovative contracting Concern that approach would inhibit traditional approachesConcern that approach would inhibit traditional approaches Cap costs at some percentage higher than PE cost estimateCap costs at some percentage higher than PE cost estimate Entry into Final Design should become the trigger for Entry into Final Design should become the trigger for

negotiating an FFGAnegotiating an FFGA Allow for some exceptions due to unavoidable cost Allow for some exceptions due to unavoidable cost

increasesincreases Policy Guidance Implements this Requirement, Policy Guidance Implements this Requirement,

with Modificationwith Modification


ApprovalApproval Expanded definition and eligible activities for Expanded definition and eligible activities for

“New Starts Preliminary Engineering”“New Starts Preliminary Engineering” Once approved into final design, projects not Once approved into final design, projects not

subject to changes in New Starts programsubject to changes in New Starts program ““PE Exit Criteria” being developed to further PE Exit Criteria” being developed to further

clarify completion of PEclarify completion of PE FTA will consider unanticipated cost FTA will consider unanticipated cost

increases after final design approval (natural increases after final design approval (natural disasters, unforseen significant commodity disasters, unforseen significant commodity market fluctuations, etc.), market fluctuations, etc.), but not execution but not execution of FFGAof FFGA

Possible Rules for Possible Rules for Mode-Specific ConstantsMode-Specific Constants

““Require all project sponsors to use pre-Require all project sponsors to use pre-established mode-specific constants for each of established mode-specific constants for each of the included attributes (reliability, span of the included attributes (reliability, span of service, and passenger amenities) that appear service, and passenger amenities) that appear to be prominent in a specific fixed-guideway to be prominent in a specific fixed-guideway proposal”proposal”

RationaleRationale Acknowledges and captures heretofore ignored non-Acknowledges and captures heretofore ignored non-

transportation (time and cost) attributes of fixed transportation (time and cost) attributes of fixed guideway projects for areas considering new guideway projects for areas considering new guideway modesguideway modes

Enhances consistent treatment of projects nationallyEnhances consistent treatment of projects nationally Improves reliability of travel forecasts by mitigating Improves reliability of travel forecasts by mitigating

against poorly-estimated constants (“correction against poorly-estimated constants (“correction factors”)factors”)

Possible Rules for Possible Rules for Mode-Specific ConstantsMode-Specific Constants

Comment – Generally supportive, but Comment – Generally supportive, but more information neededmore information needed Option 2 (specific value for each guideway Option 2 (specific value for each guideway

mode) was preferredmode) was preferred Defensible locally-derived and validated Defensible locally-derived and validated

constants should be permittedconstants should be permitted A panel of experts should be convened to A panel of experts should be convened to

establish constant valuesestablish constant values More information needed before “standard” More information needed before “standard”

constant values are implemented. constant values are implemented. Policy Guidance Does Not Implement Policy Guidance Does Not Implement

this Requirementthis Requirement

Cost Effectiveness Cost Effectiveness BreakpointsBreakpoints

Based on DOT Guidance on the Value of TimeBased on DOT Guidance on the Value of Time Original breakpoints reflected Year 2000 Original breakpoints reflected Year 2000

data:data:

(50% * Annual MHI ($42,148))/(50% * Annual MHI ($42,148))/

(hourly factor (2000)) = (hourly factor (2000)) =

$10.54 per hour$10.54 per hour

$10.54 * highway benefits (1.2) * indirect benefits (2.0) = $10.54 * highway benefits (1.2) * indirect benefits (2.0) =

$25.00 per hour$25.00 per hour

Adjusted Annually by GDP DeflatorAdjusted Annually by GDP Deflator

Cost Effectiveness Cost Effectiveness BreakpointsBreakpoints

Cost Effectiveness Rating Cost Effectiveness Value High less than or equal to$11.49

Medium-High between $11.50 and $14.99 Medium between $15.00 and $22.99

Medium-Low between $23.00 and $28.99 Low greater than or equal to $29.00

Contractor Performance Contractor Performance Assessment ReportAssessment Report

SAFETEA-LU ProvisionsSAFETEA-LU Provisions Secretary shall submit a report to Secretary shall submit a report to

Congressional committees analyzing the Congressional committees analyzing the consistency and accuracy of cost and consistency and accuracy of cost and ridership estimates made by each contractor ridership estimates made by each contractor to public transportation agencies developing to public transportation agencies developing new fixed guideway capital projectsnew fixed guideway capital projects

Report should compare the cost and ridership Report should compare the cost and ridership estimates at PE approval with estimates estimates at PE approval with estimates made at FD approval, commencement of made at FD approval, commencement of revenue operation and 2 years afterwardrevenue operation and 2 years afterward

Comparisons should take into consideration Comparisons should take into consideration factors not under control of the contractorfactors not under control of the contractor

Contractor Performance Contractor Performance Assessment ReportAssessment Report

ImplementationImplementation In effect for all PE requests subsequent to May 22In effect for all PE requests subsequent to May 22 Required information:Required information:

Ridership forecasts, service levels, underlying Ridership forecasts, service levels, underlying assumptions, uncertaintiesassumptions, uncertainties

Cost estimates, plans/profiles, design Cost estimates, plans/profiles, design standards, uncertaintiesstandards, uncertainties

Identification of responsible parties and rolesIdentification of responsible parties and roles Reporting format available from FTAReporting format available from FTA Information reported at subsequent milestones Information reported at subsequent milestones Report annually to Congressional committeesReport annually to Congressional committees Performance assessment will be project-specific, Performance assessment will be project-specific,

not overall assessment of firmnot overall assessment of firm

New Starts Reporting New Starts Reporting InstructionsInstructions

No significant changes to reportingNo significant changes to reporting New Starts Baseline Principles and New Starts Baseline Principles and

Cost ParametersCost Parameters Updated Standard Cost CategoriesUpdated Standard Cost Categories Updated CEO CertificationUpdated CEO Certification ““Linked” New Starts TemplatesLinked” New Starts Templates

Schedule for FY 2008 Schedule for FY 2008 New Starts ReportingNew Starts Reporting

July 14 (requested): Any changes to New July 14 (requested): Any changes to New Starts Project Justification Criteria Starts Project Justification Criteria “inputs” since last FTA evaluation“inputs” since last FTA evaluation Travel ForecastsTravel Forecasts Capital Costs (Build and Annualized Baseline)Capital Costs (Build and Annualized Baseline) O/M Cost MethodologyO/M Cost Methodology Annualization FactorAnnualization Factor

August 18: Formal New Starts submission August 18: Formal New Starts submission (templates, land use, financial info)(templates, land use, financial info)

September 30: Latest that FTA can September 30: Latest that FTA can consider new/updated/revised informationconsider new/updated/revised information

FY 2008 New Starts FY 2008 New Starts Evaluation ProcessEvaluation Process

Consistent with FY 2007 ProcessConsistent with FY 2007 Process Updated Cost Effectiveness Updated Cost Effectiveness

BreakpointsBreakpoints Consideration of Economic Consideration of Economic

Development as an “Other Factor”Development as an “Other Factor”