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Module 2.1: Introduction to FTA Grants KEY CONCEPTS ⢠Introduction to Public Transit ⢠A Brief History of Federal Transit Funding ⢠Regulatory Structure ⢠The Role of the States in FTA Programs ⢠The Programs: S. 5307, 5310, 5311, 5339 ⢠FTA Cross-Cutting Requirements IMPORTANCE FOR STATE DOT STAFF FTA provides funding under a variety of formula based and discretionary programs. As a recipient of program funding, the state is responsible for administering and managing grants in compliance with all relevant federal regulations. The state is also responsible for overseeing the funds that it passes through to its sub-recipients. The state must ensure that sub-recipients comply with FTA requirements; the requirements Ïlow through the state along with the funding. DEFINITIONS MAP-21: the acronym for the Moving Ahead for Progress in the 21st Century Act, the current authorizing legislation for federal transit funding. Congress establishes the legal authority to commence and continue FTA programs through authorizing legislation covering several years. On July 6, 2012, President Obama signed Moving Ahead for Progress in the 21st Century, reauthorizing surface transportation programs through Ïiscal year 2014. Each reauthorization amends the federal transit laws codiÏied in 49 USC Chapter 53. MAP-21 took effect on October 1, 2012. INTRODUCTION A subset of the U.S. Department of Transportation, the Federal Transit Administration (FTA) provides federal funding for new and existing public transportation service across the country. For someone new to the Ïield, getting a handle on the requirements of multiple FTA funding programs (not to mention FTA jargon and acronyms) can be overwhelming. This module provides a roadmap to FTA programs administered by states, and context for later and more in-depth modules. LEVEL II - PAGE II-1
Public Transportation (also called transit, public transit, or mass transit): deÏined in MAP-21 as âregular, continuing shared- ride surface transportation services that are open to the general public or open to a segment of the general public deÏined by age, disability, or low income.â The MAP-21 deÏinition also speciÏically excludes Amtrak intercity passenger rail transportation, intercity bus service, charter bus service, school bus service, sightseeing service, courtesy shuttle service for patrons of speciÏic establishments, and intra-terminal or intra-facility shuttle services. Transit Agency/System: an entity (public or private) responsible for administering and managing transit activities and services. Transit agencies can directly operate transit service or contract out for all or part of the total transit service provided. When responsibility is with a public entity, it is a public transit agency. When more than one mode of service is operated, it is a multimodal transit agency. The American Public Transportation Association (APTA) Fact Book Glossary is a great source for public transit-related deÏinitions and is online at http://www.apta.com/resources/statistics/Pages/glossary.aspx. Numerous other deÏinitions are found in context throughout this module and in the resources referenced in the module. Your state transit program may also have its own set of deÏinitions. SUMMARY OF FTA REQUIREMENTS IntroducÆ on to Public Transit Public transit is often referred to as public transportation. The federal government, in the current authorizing legislation (MAP-21) for federal Ïinancial assistance for public transportation, deÏines public transportation as âregular, continuing shared-ride surface transportation services that are open to the general public or open to a segment of the general public deÏined by age, disability, or low income.â The MAP-21 deÏinition also speciÏically excludes Amtrak intercity passenger rail transportation, intercity bus service, charter bus service, school bus service, sightseeing service, courtesy shuttle service for patrons of speciÏic establishments, and intra- terminal or intra-facility shuttle services. Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-2
Historically, the expression mass transit was commonly used as a synonym for public transit, but this expression has fallen out of favor with the emergence of types of specialized public transportation that move relatively small volumes of people. Public transit takes many forms, often referred to in industry jargon as modes, such as local bus service, express bus commuter rail, subway, light rail, bus rapid transit, curb-to-curb paratransit, etc. Most modes fall within one of two major categories of transit service design: Ïixed-route service and demand-response service. ⢠Fixed-Route Service: Service provided on a repetitive, Ïixed schedule basis along a speciÏic route with vehicles stopping to pick up and deliver passengers to speciÏic locations. Each Ïixed-route trip serves the same origins and destinations, unlike demand-response service. Typically, Ïixed-route service is characterized by features such as printed schedules or timetables, designated bus stops where passengers board and disembark, and the use of larger transit vehicles. Fixed-route modes can include traditional bus service, commuter bus, light rail, subway (heavy rail), bus rapid transit, shuttle service, feeder, and ferry boat service. Fixed-route service is typically designed to move high volumes of people in an efÏicient manner, and is what comes to mind when the term mass transit is used. ⢠Demand-Response Service: Service where individual passengers can request door-to-door or curb-to-curb transportation from a speciÏic location to another speciÏic location at a certain time. These services may require advance reservations. Also referred to as dial-a-ride, paratransit, or demand-responsive transit (DRT). Demand-response modes can vary in the degree of Ïlexibility and structure, and include ADA complementary paratransit, subscription service, shared-ride taxi, volunteer transportation, vanpools, and Ïlexible routes (also known as route deviation). Demand-response service is typically designed to move small groups or individuals under circumstances where Ïixed route service cannot efÏiciently and effectively meet their needsâeither because the riders themselves have special needs or simply because the demand is lower and less concentrated, such as in rural areas. The term mode can also refer to the type of vehicle used, how it is powered, and upon what it travelsâas well as the speciÏic type of service that it operates. ⢠Bus is a mode of transit service (called motor bus in the National Transit Database) characterized by roadway vehicles powered by diesel, gasoline, battery, or alternative fuel engines contained within the vehicle. Buses operate on streets and roadways. Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-3
⢠Paratransit or Demand-Response modes are characterized by the use of passenger automobiles, vans, or small buses powered by diesel, gasoline, battery, or alternative fuel engines contained within the vehicle, which operate on streets and roadways. ⢠Heavy Rail is a mode of transit service (also called metro, subway, rapid transit, or rapid rail) operating on an electric railway with the capacity for a heavy volume of trafÏic. It is characterized by high speed and rapid acceleration passenger rail cars operating singly or in multi-car trains on Ïixed rails; separate rights-of-way from which all other vehicular and foot trafÏic are excluded; sophisticated signaling; and high platform loading. ⢠Light Rail is a mode of transit service (also called streetcar, tramway, or trolley) operating passenger rail cars singly (or in short, usually two-car or three-car, trains) on Ïixed rails in right-of-way that is often separated from other trafÏic. Light rail vehicles are typically driven electrically with power drawn from an overhead electric line via a trolley or a pantograph; driven by an operator on board the vehicle; and may have either high platform loading or low level boarding using steps. ⢠Ferry Boat is a transit mode comprising vessels carrying passengers and in some cases vehicles over a body of water, and that is generally steam or diesel-powered. For deÏinitions of the many speciÏic service modes, readers are encouraged to explore the APTA Fact Book Glossary (http://www.apta.com/ resources/statistics/Pages/glossary.aspx). Also good to know is that, when it comes to FTA funding administered at the state level, public transportation generally falls into three major categories in terms of target market: 1) urban transit, 2) rural transit, and 3) specialized transportation. ⢠Urban transit is what many people initially picture â bus and rail running in major cities with set schedules and routes. This type of transit is primarily funded through FTAâs Urbanized Area Program (S. 5307). Small urbanized areas (those with Decennial Census populations between 50,000 and 199,999) have differing federal requirements than large urbanized areas (those with Decennial Census populations of 200,000 or more). ⢠Given the nature of its service area, rural transit may use smaller vehicles, run on more Ïlexible routes with time for deviations, or offer demand response service. FTA supports this type of transit through the Rural Area Program (S. 5311). Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-4
⢠Finally, specialized transportation serves those whose needs are not met by more traditional public transit, including the elderly and individuals with disabilities. The Enhanced Mobility of Seniors and Individuals with Disabilities Program (S. 5310) funds most specialized transportation. The FTA funding programs introduced above will be described later in this module. A Brief History of Federal Transit Funding Federal Ïinancial assistance for public transportation has a relatively short history, beginning in 1964 when Lyndon Johnson signed the Urban Mass Transportation Act into law. By authorizing funding in support of public transportation, the Johnson administration was attempting to revitalize deteriorating urban transit systems. Shortly after came the creation of the U.S. Department of Transportation and the Urban Mass Transportation Administration (UMTA). Subsequent transportation laws had new and expanded provisions, like planning services for the elderly and disabled (1970), buying American (1978), and providing technical assistance for rural systems (1987). ReÏlecting this broadening mandate and inclusion of urban transit, rural transit, and specialized transportation, UMTA changed its name to FTA in 1991 with the passage of Intermodal Surface Transportation EfÏiciency Act (ISTEA). Authorizing Legislation Over Time ⢠Urban Mass Transportation Act, 1964 ⢠Urban Mass Transportation Assistance Act, 1970 ⢠National Mass Transportation Assistance Act, 1974 ⢠Surface Transportation Assistance Act, 1978 ⢠Federal Public Transportation Act, 1982 ⢠Surface Transportation and Uniform Relocation Assistance Act, 1987 ⢠Intermodal Surface Transportation EfÏiciency Act (ISTEA), 1991 ⢠Transportation Equity Act for the 21st Century (TEA-21), 1998 ⢠Safe, Accountable, Flexible, EfÏicient, Transportation Equity Act: A Legacy for Users (SAFETEA-LU), 2005 ⢠Moving Ahead for Progress in the 21st Century Act (MAP-21), 2012 Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-5
Regulatory Structure When a document (or an online curriculum...) starts throwing around terms like âCFR thisâ or âUSC that,â it may be tempting to skim ahead. However, laws and regulations are the basis for FTA funding assistance, and they are referenced repeatedly in FTA resources. The above list of transportation acts are the top rung in a hierarchy of FTA requirements. Also known as federal statutes, laws like MAP-21 are enacted by Congress and codiÏied in the United States Code (USC). The USC is divided into titles; Title 49, Chapter 53 covers public transportation. Next are federal regulations, issued by agencies like FTA that get their authority to regulate from the enabling statutes. Regulations are designed to interpret the statutes and detail implementation and enforcement. Federal regulations are codiÏied in the Code of Federal Regulations (CFR) and published in the Federal Register. Like the USC, Title 49 of the CFR also covers transportation. The FTA Master Agreement is the next level in the hierarchy. Updated annually, the Master Agreement contains FTA and other federal requirements applicable to all grant recipients. Its purpose is to detail terms and conditions, including the recipientâs agreement to maintain the legal, Ïinancial, technical, and managerial capacity to carry out federally funded projects. The Master Agreement also spells out that as recipients, states are responsible for oversight of their subrecipients. Ranking lowest in the hierarchy is administrative guidance (e.g. directives, orders, guidelines, FTA circulars, and policy letters commonly referred to as âDear Colleagueâ letters). Circulars cover the different sections of the USC, and provide instructions to grantees on how FTA grants will be administered. This guidance provides grantees with direction on program speciÏic issues and statutory requirements. Grantees are required to comply with all circulars after signing the agreement accepting federal Ïinancial assistance. The âGrants Management Requirementsâ FTA Circular 5010.1D is a good reference point in the absence of a program-speciÏic circular. FTA circulars are updated through a formal rulemaking process (with proposed guidelines published in the Federal Register for public review and comment). Each update may be revised multiple times, so check for the most recent revision before consulting a circular. The Common Rule: Beyond any FTA-speciÏic grant requirements, 49 CFR Part 18 âUniform Administrative Requirements for Grants and Cooperative Agreementsâ applies to all federal grant recipients (also known as the Common Rule). Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-6
The Role of the States in FTA Programs FTA provides funding under a variety of formula based and discretionary programs. As a recipient of program funding, the state is responsible for administering and managing grants in compliance with all relevant federal regulations. It must have the technical capacity and stafÏing resources to carry out its responsibilities [see C.5010.1D pII-6 for a detailed list of responsibilities]. The state is also responsible for overseeing the funds that it passes through to its subrecipients. The state must ensure that subrecipients comply with FTA requirements; the requirements Ïlow through the state along with the funding. Among others, the stateâs oversight responsibilities include: ⢠Having a written agreement with each subrecipient detailing expectations and requirements (this often incorporates the FTA Master Agreement) ⢠Providing technical assistance to help subrecipients meet those requirements ⢠Monitoring the subrecipients for compliance (e.g. site visits) and documenting the systems for doing so Under MAP-21, the following programs are administered by state DOTs: S. 5310 (for rural and small urbanized areas; some states may be the designated recipient for large urbanized areas as well), S. 5311, and S. 5339. Many states also administer the S. 5307 program (for small urbanized areas only). Prior to the passage of MAP-21, states also administered the former S. 5316 program (which MAP-21 melded into the S. 5307/5311 programs) and S. 5317 program (which MAP-21 folded into the S. 5310 program). Also prior to MAP-21, states were responsible for the entire S. 5310 program, including large urbanized areas, but MAP-21 changed the structure. States must develop and submit a State Management Plan (SMP) to FTA for the S. 5310 and S. 5311 programs (either stand-alone plans or combined). The SMP details the policies and procedures used to administer the programs. The SMP must be current and reÏlect Authorization vs. Appropriation: authorizing legislation (e.g. MAP-21) establishes or continues the legal operation of a federal program, while an annual appropriations measure funds the program. Congress typically amends FTAâs authorizing legislation every four to six years. The FTA publishes funding levels in the Federal Register after each appropriation. Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-7
actual practices, and include the elements outlined in the program circulars [states will soon need to update their SMPs for MAP-21; FTA issued proposed updated circulars for S. 5310 and S. 5311 while this curriculum was being drafted]. For all signiÏicant revisions (i.e., changes in policy that impact subrecipients), the FTA requires an opportunity for public comment. By explaining (among many other subjects) its processes for enforcement, oversight, and technical assistance, the SMP serves as a guide for subrecipients. Importantly, states use the SMP to outline their methods and criteria for subrecipient project selection. The state must distribute FTA funding on a fair and equitable basis, meaning that all potential subrecipients have a fair opportunity to demonstrate how they meet the stated criteria. As part of the grant application process, states must also submit a Program of Projects (POP) to FTA through the TEAM website (which FTA plans to replace with the TrAM system in FY 2015). The POP lists all subrecipients and identiÏies the projects for which the state is applying for Ïinancial assistance. It includes a brief description of the projects, total project cost, and federal share for each project. The state must also certify to FTA that it and its subrecipients have the Ïinancial capacity to carry out the proposed POP. Under SAFETEA-LU, funding through S. 5310, 5316, and 5317 required that projects be derived from a locally developed, coordinated public transit-human services transportation plan. This coordinated planning requirement was designed to be a participatory process including public, private, and human service transportation providers. Under MAP-21, this requirement continues to apply to S. 5310. States must ensure that their subrecipients are involved in the coordinated planning process. The coordinated plan must: 1) Identify the transportation needs of individuals with disabilities, older adults, and people with low incomes, 2) Assesses available services, 3) Provide strategies to address the gaps between services and needs, and 4) Prioritize transportation services for funding and implementation. More information about the coordinated planning requirements is found in the Local and Regional Planning module. Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-8
Additionally, some states are designated recipients for large urbanized transit service, and they themselves operate (or contract for the operation of) transit service. These states are subject to FTA requirements for S. 5307 for large urbanized areas. These requirements are not addressed in this curriculum. The FTA Funding Programs Though the details differ, a handful of characteristics are typical of most FTA funding programs: ⢠Eligible expenses vary by program (capital, operating, or planning) ⢠Eligible recipients and subrecipients also vary by program (states, local government authorities, private non-proÏits, public transit operators, etc.) ⢠All have local match requirements, generally: -Capital assistance: 80% federal share + 20% local match -Operating assistance: 50% federal share + 50% local match ⢠All have post-award reporting requirements, submitted through TEAM: -Federal Financial Reports (FFRs)- Ïinancial data -Milestone/Progress Reports (MPRs)- narrative description Recipients Galore Designated Recipient: Either a state, or an entity designated by a governor, designated to receive funds from FTA (e.g., an MPO). Direct Recipient: A public entity authorized by a designated recipient or the state to receive funds from FTA (e.g. a state DOT). Subrecipient: An entity (e.g. a local government, a non-proÏit organization, or a public transportation operator) that receives FTA funds through a direct or designated recipient. The original recipient remains responsible for compliance under the grant. Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-9
⢠Some have National Transit Database (NTD) reporting requirements (S. 5307 and S. 5311 recipients) ⢠All involve FTA oversight reviews. The two comprehensive reviews (i.e. not program- or project-speciÏic) are: -The Triennial Review (S. 5307 recipients) -The State Management Review (S. 5311 and S. 5310 recipients) ⢠Under MAP-21, there will be increased emphasis on reporting and performance monitoring. It is still unclear what will be required, but it appears that it will apply to all FTA funding programs administered by the states. Local Match FTA program funding comes with minimum local match requirements, generally at 20% for capital projects and 50% for operating expenses (net of operating revenue). Local match cannot come from other U.S. DOT funding, or from farebox revenue. Some examples of sources that may be used for local match include: ⢠dedicated tax revenues; ⢠state or local appropriations (many states provide a state match to FTA funding that reduces the amount of local funding subrecipients must garner); ⢠non-farebox revenues from transit operations (e.g. advertising, concessions) ⢠private donations ⢠in-kind contributions Capital projects typically involve purchasing, leasing, constructing, maintaining, or repairing facilities, vehicles, technology, other equipment, or infrastructure. Under certain FTA programs, capital projects can include mobility management activities. Operating projects are typically related to service delivery, including the operation, maintenance, and management of a public transportation system. Operating expenses usually include such costs as driver salaries, fuel, and items having a useful life of less than one year. Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-10
Farebox revenue cannot be used as local match; instead, farebox revenue is deducted from the total project cost to determine operating deÏicit, and federal and local match percentages are applied to this deÏicit rather than the total project cost. Contract revenue (e.g., from human service agencies) can sometimes be used at local match, depending on the FTA program and transit system size. More information about requirements for and allowable sources of local match are included in the Subrecipient Financial Management module. SecÆ on 5307- Urbanized Area Formula Program For more information, see FTA Circular 9030.1E (proposed). Why: Funding to urbanized areas (UZAs), i.e. areas with a population of 50,000 or more as designated by the Census Bureau. The program is a âcore investmentâ for places that depend on public transportation for mobility and congestion relief. What: Capital, planning, job access and reverse commute (JARC) projects, and some operating expenses are eligible. Operating expenses are limited to areas with less than 200,000 in population, or in areas greater than 200,000 where the recipient operates 100 buses or less in peak hour Ïixed-route service [new in MAP-21]. MAP-21 folded the former JARC program (S. 5316) into both S. 5307 and 5311. JARC projects are intended to improve access to suburban employment opportunities and to employment-related transportation services, speciÏically for welfare recipients and low-income individuals (e.g. late night and weekend service, guaranteed ride home service, etc.). There is no Ïloor or ceiling to the amount of funding used for JARC projects under S. 5307. MAP-21: Congress reauthorized FTAâs surface transportation programs through FY14 by passing MAP-21. Each reauthorization amends the laws codiÏied in 49 USC Chapter 53. President Obama signed MAP-21 on July 6, 2012, and it took effect on October 1, 2012. MAP-21 repealed several funding programs that existed under SAFETEA-LU. Funds authorized under these programs remain available until the funds are spent, rescinded by Congress, otherwise reallocated, or reach the end of their period of availability. Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-11
Module 2.1: Introduction to FTA Grants Who: States or designated recipients: a designated recipient is responsible for administering the program for UZAs over 200,000; some states are responsible for all UZAs between 50,000 and 200,000. Subrecipients are state/local government authorities. How: Allocation is based on population in UZAs over 200,000; and on population, population density, and low income individuals in UZAs between 50,000 and 200,000. To be eligible, projects must be included in the local Transportation Improvement Plan (TIP) and State Transportation Improvement Plan (STIP). A designated recipient can be either: ⢠designated by a state governor, responsible local ofÏicials, and publicly owned operators of public transportation, to receive and apportion funding under certain FTA programs (including S. 5307) to urbanized areas of 200,000 or more in population; or ⢠a state or regional authority, if the authority is responsible under the laws of a state for a capital project and for Ïinancing and directly providing public transportation. Typical designated recipients include MPOs, regional transit authorities, and public transportation districts. A direct recipient is authorized by a designated recipient or state to receive S. 5307 funds directly from FTA. In small urbanized areas, the state is sometimes the recipient of S. 5307 funds with local transit operators as its subrecipients. In other states, transit systems operating in small urban areas have a direct recipient relationship with FTA. In these cases, states may have little or no involvement in administering transit funds to these operators unless the state has a state transit funding program. LEVEL II - PAGE II-12
SecÆ on 5310 â Enhanced Mobility of Seniors and Individuals with DisabiliÆ es For more information, see FTA Circular 9070.1G (proposed). Why: To improve mobility for seniors and individuals with disabilities through projects that meet their special needs. S. 5310 also includes funding for public transportation services and alternatives to those services that go beyond ADA requirements. The program spans geographiesâfrom rural to urban. What: Capital and operating expenses are eligible. Recipients can also use up to 10% of program funds for administration. MAP-21 folded the former New Freedom program (S. 5317) into S. 5310. Under the new program, at least 55% of program funds must go toward capital projects, as under the former S. 5310: âprojects planned, designed, and carried out to meet the special needs of seniors and individuals with disabilities when public transportation is insufÏicient, inappropriate, or unavailable.â Up to 45% of funds may go toward projects formerly eligible under New Freedom, i.e. those that: ⢠exceed ADA requirements, ⢠improve access to Ïixed-route service and decrease reliance on complementary paratransit, or ⢠are alternatives to public transportation and assist seniors and individuals with disabilities. Who: States (for areas under 200,000 in population) or designated recipients. Subrecipients are primarily private non-proÏits. Subrecipients may be state/local government authorities if no non-proÏits are available, or if they are approved by the state (e.g. a county agency on aging). How: Under MAP-21, 60% of total funding goes to designated recipients in large UZAs (200,000 and above in population); 20% to states for small UZAs (50,000 to 200,000); and 20% to states for rural areas. Recipients then allocate by formula (the number of elderly persons and persons with disabilities). To be eligible, projects must be derived from a locally developed, coordinated public transit- human services transportation plan. Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-13
SecÆ on 5311 â Formula Grant for Rural Areas For more information, see FTA Circular 9040.1F [not yet up-to-date under MAP-21]. Why: Funding to support public transportation in rural areas (less than 50,000 in population). Rural providers may design their services to maximize use by the transportation disadvantaged (i.e. the elderly and individuals with disabilities), but the state must ensure that the services are open and marketed to the general public. What: Capital, operating, planning, and job access and reverse commute (JARC) project expenses are eligible. Recipients can also use up to 10% of program funds for administration [reduced from 15% under SAFETEA-LU]. Additional components/set asides include: ⢠Intercity Bus, S. 5311(f): states must use 15% of their total S. 5310 funding to support intercity bus service, unless the governor, in consultation with intercity providers, certiÏies that intercity bus needs are being adequately met. ⢠Rural Transportation Assistance, S. 5311(b)(3): 2% of the total S. 5311 funding goes to training and technical assistance for rural transit operators. ⢠Tribal Program, S. 5311(c)(1): a combination of formula and discretionary funding for tribes. ⢠Appalachian Development Public Transportation Assistance: formula funding for states in Appalachia. MAP-21 folded the former JARC program (S. 5316) into both S. 5307 and 5311. JARC projects are intended to improve access to suburban employment opportunities and to employment-related transportation services, speciÏically for welfare recipients and low-income individuals (e.g. late night and weekend service, guaranteed ride home service, etc.). There is no Ïloor or ceiling to the amount of funding used for JARC projects under S. 5311. Who: States or Indian tribes. Sub-recipients are state/local government authorities, private non-proÏits, or public transportation/ intercity bus operators. How: Allocation is based on land area and population (~83% of total funding), and on land area, vehicle revenue miles, and low-income individuals (~17% of total funding). To be eligible, projects must be included the State Transportation Improvement Plan (STIP). Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-14
SecÆ on 5339 â Bus and Bus FaciliÆ es For more information, see FTA Circular 9300.1B [not yet up-to-date under MAP-21]. Why: Funding for new and replacement buses and bus-related facilities. What: Capital assistance only. Who: States or designated recipients that operate or allocate funding to Ïixed-route bus operators. Sub-recipients are state/local governmental authorities or private non-proÏits. How: Each state receives a Ïlat amount. The remainder is allocated based on population, vehicle revenue miles, and passenger miles. Previously a discretionary rather than a formula program, Bus and Bus Facilities shifted from S. 5309 (repealed) to its own S. 5339 under MAP-21. The former S. 5309 included Fixed Guideway and New Starts/Small Starts as well as Bus and Bus Facilities. Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-15
Highlights of MAP-21 Program Changes New ⢠Safety Authority (5329) ⢠State of Good Repair Grants (5337) â¢Asset Management (5326) ⢠Bus and Bus FaciliÆ es Formula Grants (5339) ⢠Public TransportaÆ on Emergency Relief (5324) â¢TOD Planning Pilot Grants (20005(b) of MAP-21) Repealed ⢠Clean Fuels Grants (5308) â¢Job Access and Reverse Commute (5316) [JARC] ⢠New Freedom Program (5317) ⢠Paul S. Sarbanes Transit in the Parks (5320) â¢AlternaÆ ves Analysis (5339) ⢠Over-the-Road Bus (Sec. 3038 âTEA-21) Consolidated ⢠Urbanized Area Formula Grants (5307) [JARC] ⢠Enhanced Mobility of Seniors and Individuals with DisabiliÆ es (5310) [New Freedom] ⢠Rural Area Formula Grants (5311) [JARC] Modifi ed ⢠Fixed Guideway Capital Investment Grants (5309) â¢Metropolitan and Statewide Planning (5303 & 5304) â¢Research, Development, DemonstraÆ on, and Deployment (5312) â¢Technical Assistance and Standards (5314) ⢠Human Resources and Training (5322) Source: hÆ© p://www.Å a.dot.gov/documents/MAP-21_Public_PresentaÆ on.pdf Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-16
FTA Cross-CuÆ« ng Requirements In addition to program-speciÏic requirements, state DOTs and their subrecipients must meet numerous other FTA and federal requirements. These include: ⢠Americans with Disabilities Act (ADA) - prohibits discrimination against individuals with disabilities. This federal civil rights law and the U.S. DOT and FTA implementing regulations set forth speciÏic requirements for providing services that are accessible and nondiscriminatory to people with disabilities. ADA also prohibits discrimination in employment. The ADA module describes ADA requirements with which state transit staff need to be familiar. ⢠Asset Management - MAP-21 established new requirements for transit asset management by FTAâs grantees as well as new reporting requirements to promote accountability. Transit assets are capital assets such as equipment, vehicles, infrastructure, and facilities. FTA requirements for asset management are currently under development. All FTA grantees and their subrecipients will be required to develop transit asset management plans and submit periodic reports. ⢠Buy America - requires that FTA-funded projects exceeding a certain dollar value (currently $100,000) involving steel, iron, and manufactured products are produced in the United States, and the state and subrecipients are required to conduct certain compliance monitoring, particularly for vehicle manufacturing. The Procurement module provides more information. ⢠Charter Bus - prohibits FTA-funded service, equipment, or facilities use in providing charter service except under very limited circumstances. ⢠Davis-Bacon Act - requires paying the local prevailing wages on public works projects, including construction projects funded by FTA valued at $2,000 or more. The Procurement module provides more information. ⢠Debarment and Suspension - tools used to protect the public from fraud, waste, and abuse in federal transactions. States and subrecipients must not make, or permit, any award (subgrant or contract) at any tier to any party that is debarred or suspended or is otherwise excluded from or ineligible for participation in federal assistance programs. The Legal Authority and Annual CertiÏications and Procurement modules provide more information. Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-17
⢠Disadvantaged Business Enterprises (DBE) - States and subrecipients must create a level playing Ïield on which disadvantaged businesses (i.e., those owned by minorities or women) can compete fairly for DOT-assisted contracts. DBE is a civil rights program that applies to procurement. The Disadvantaged Business Enterprise module provides more information. ⢠Drug and Alcohol (Alcohol and Controlled Substances Testing under MAP-21) - States and subrecipients receiving S. 5307, S. 5311, or S. 5339 funds must have a drug and alcohol testing program in place for all safety-sensitive employees. ⢠Environmental Justice (EJ) - a civil rights concern that requires analysis of how a proposed project (e.g., a service or facility) would affect minority or low-income populations. FTA-funded projects that would have a disproportionately high or adverse effect on these populations may only be carried out if alternatives or mitigating measures are not practicable. ⢠Equal Employment Opportunity (EEO) - prohibits discrimination in employment under any FTA-funded project, program, or activity on the grounds of race, color, religion, national origin, sex, age, or physical or mental disability. ⢠Labor Protection - Section 5333(b) of 49 USC protects transit agency employee working conditions from being adversely affected by the provision of federal grants. States and S. 5311 subrecipients are required to submit a special warranty. ⢠Lobbying - The use of federal funds for lobbying is prohibited. Recipients (and their contractors and subrecipients) receiving federal grants and contracts over $100,000 must certify compliance with this restriction and submit reports on any non-federally funded lobbying activities. ⢠National Transit Database (NTD) - Recipients of S. 5307 and S. 5311 funds must collect, record, and report Ïinancial and non- Ïinancial data. The proposed S. 5310 circular that was released in August 2013 indicates that S. 5310 subrecipients will also be required to report NTD data. Currently, states collect and submit this data on behalf of their S. 5311 subrecipients. For more information, see the Subrecipient Grant Administration module. ⢠Planning/Program of Projects - States and recipients must comply with transportation planning requirements in accordance with FTA requirements, MAP-21, and statewide and metropolitan planning regulations. Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-18
⢠Procurement - a host of federal requirements and restrictions kick in when FTA funds are used to purchase supplies, equipment, or services. States and subrecipients must have written procurement policies and procedures that meet numerous requirements and provide for full and open competition. Buy America and DBE are large elements of the procurement requirements and thus typically stand on their own as FTA compliance areas. The Procurement module provides more information. ⢠Protection of the Environment - Many different federal laws, rules, and regulations govern environmental review of FTA- assisted projects. The National Environmental Policy Act (NEPA) establishes an umbrella process for coordinating compliance with each law through the preparation of an Environmental Impact Statement (EIS) for major projects. This important planning step determines how a proposed project would affect trafÏic (parking, access, and circulation), air quality, noise, vibration, community, parks and recreational areas, wetlands, Ïlood plains, soil/water conditions, water quality, ecologically sensitive areas, endangered species, displacement of current residents and businesses, equitability of service to minority and low income populations (EJ), and compatibility with zoning. ⢠Safety & Oversight - MAP-21 grants FTA the authority to establish and enforce a new comprehensive framework to oversee the safety of public transportation throughout the United States as it pertains to heavy rail, light rail, buses, ferries, and streetcars. The law requires, among other things, that FTA update the State Safety Oversight (SSO) program to ensure that rail transit systems are meeting basic, common-sense safety requirements. The law also includes important new safety provisions for bus- only operators. FTA will develop minimum safety performance standards, and FTAâs Bus Testing Program will be required to incorporate the standards into a new Pass/Fail rating system. All recipients of FTA funding will develop an agency safety plan and certify that the plan meets FTA requirements. For S. 5311 subrecipients, the plan may be drafted and certiÏied by the recipient or the state. For recipients receiving S. 5307 funds, FTA will issue a rule designating the small public transportation providers or systems that may have their safety plans drafted or certiÏied by the state. ⢠School Bus - prohibits FTA-funded service, equipment or facilities use in providing exclusive school bus service except under very limited circumstances. ⢠Title VI - Title VI of the Civil Rights Act of 1964, as amended, prohibits discrimination on the grounds of race, color, or national origin, in terms of service delivery as well as distribution of transit services and related beneÏits, and employment. For more information, see the Title VI module. Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-19
Recipients of funding under the S. 5307 program are subject to these additional speciÏic requirements: ⢠Drug-Free Workplace - States and direct recipients are required to maintain a drug-free workplace for all employees and to have an ongoing drug-free awareness program. ⢠Half Fare - During non-peak hours for Ïixed route service supported with S. 5307 assistance, grantees must ensure that the fare charged elderly persons, persons with disabilities or an individual presenting a Medicare card will not be more than half the peak hour fare. ⢠Public Comment on Fare and Service Changes - Recipients of S. 5307 assistance are expected to have a written copy of a locally developed process to solicit and consider public comment before raising a fare or carrying out a major reduction of transportation services. ⢠Security - S. 5307 recipients must annually certify that they are spending at least one percent of such funds for transit security projects or that such expenditures for security systems are not necessary. TIPS ON RELATIONSHIPS TO OTHER MODULES This module provides foundation knowledge that is needed for the remaining modules. QUIZ 1. The acronym DRT refers to: 1) Deviated-Route Transit 2) Demand-Responsive Transit Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-20
2. S. 5310 subrecipients are considered FTA designated recipients. 1) True. 2) False. 3. -What is the maximum Federal share under the S. 5339 Bus and Bus Facilities program? 1) 75%. 2) 80%. 3) 50% of the net operating cost. 4) varies depending on the type of project. 4. For which programs are states not eligible to be the designated recipient for small urbanized areas? A) S. 5307 B) S. 5310 C) S. 5311 1) A. 2) A & B. 3) C. 4) none of the above. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-21
LINKS/INFO ⢠FTA Circulars. http://www.fta.dot.gov/legislation_law/12349.html. ⢠FTA MAP-21 Website (includes Program Fact Sheets). http://www.fta.dot.gov/map21.html. ⢠FTA Master Agreement. http://www.fta.dot.gov/documents/19-Master.pdf. ⢠American Public Transportation Association (APTA) Fact Book Glossary. http://www.apta.com/resources/statistics/Pages/glossary.aspx ⢠Currier, Reasa. Public Transit: Looking Back and Moving Forward. Transportation Law Journal, 37: 119. 2010. http://www.fta.dot.gov/documents/transportation_law_journal_Hein.pdf. Module 2.1: Introduction to FTA Grants LEVEL II - PAGE II-22
KEY CONCEPTS ⢠Subrecipient Legal Authority ⢠Role of the Governing Body and Advisory Committee ⢠Subrecipient CertiÏications and Assurances ⢠Suspension/Debarment ⢠Lobbying Restrictions In addition to having your subrecipients sign their annual certiÏications and assurances, two additional actions are required of you as the state agencyâone dealing with the restrictions on lobbying and another dealing with ensuring that subrecipients are not barred from doing business with the federal government. These are outlined below. The statutes and regulations that spell out these regulations are: Suspension/Debarment ⢠2 CFR Part 180, âOMB Guidelines to Agencies on Government-wide Debarment and Suspensionâ ⢠2 CFR Part 1200, âNonprocurement Suspension and Debarmentâ ⢠System Award Management Search INTRODUCTION This module addresses the basic legal requirements to receiving FTA funds, including those related to conducting business in an ethical manner. Grantees must be eligible and authorized under state and local law to request, receive, and dispense FTA funds and to execute and administer FTA funded projects. The authority to take actions and responsibility on behalf of the grantee must be properly delegated and executed. Before expending any FTA funds on projects, the state certiÏies to FTA that it, and others operating on its behalf, have met all statutory and program requirements. The governor of your state has designated your agency with the principal authority and responsibility for administering FTA program funds and has assured FTA that your agency has the requisite technical capacity to receive and administer those funds. Your agency, on the other hand, is responsible for ensuring that your subrecipents are aware of and comply with the federal requirements associated with the FTA programs. Thus, the state must have an on-going system to ensure that subrecipients adhere to federal requirements. The function of subrecipient oversight starts with 1) your review of the legal authority of subrecipients, and 2) their assurances (by signing the annual certiÏications) that they will comply with the federal rules. Module 2.2: Legal Authority and Annual Certifications LEVEL II - PAGE II-23
Lobbying Restrictions ⢠1989 Byrd Anti-Lobbying Amendment, 31 USC 1352, as amended by the Lobbying Disclosure Act of 1995 ⢠49 CFR Part 20, âNew Restrictions on Lobbyingâ IMPORTANCE FOR STATE DOT STAFF Establishing that your subrecipients are authorized to receive FTA funds is a critical part of every stateâs transit program. The certiÏications and assurances are generally handled as part of the stateâs annual grant application process and are intended to ensure that subrecipients comply with federal regulations as outlined in the FTA Master Agreement. It is important that your subrecipients understand and comply with these requirements since ultimately, if they are not in compliance, the state is not in compliance. A special note regarding lobbying: failing to abide by lobbying restrictions can result in Ïines. In addition to this tangible consequence, it is important to remember that FTA funding is ultimately taxpayer money; the receipt of FTA funding comes with certain ethical obligations. These obligations are passed on to subrecipients and their contractors and subcontractors. States are responsible for oversight of subrecipient compliance with lobbying restrictions. DEFINITIONS Covered Federal Action: any of the following federal actions: (1) the awarding of any federal contract; (2) the making of any federal grant; (3) the making of any federal loan; (4) the entering into of any cooperative agreement; and, (5) the extension, continuation, renewal, amendment, or modiÏication of any federal contract, grant, loan, or cooperative agreement. Debarred or Suspended: Contractors that have been âdebarred or suspendedâ have been declared ineligible, on the basis of statutory or other regulatory procedures, and are excluded from receiving contracts, and if applicable, subcontracts from the federal government. Designated Recipient: (A) an entity designated, in accordance with the planning process under S. 5303 and S. 5304, by the governor of a state, responsible local ofÏicials, and publicly owned operators of public transportation, to receive and apportion amounts under Module 2.2: Legal Authority and Annual Certifications LEVEL II - PAGE II-24
S. 5336 to urbanized areas of 200,000 or more in population; or (B) a state or regional authority, if the authority is responsible under the laws of a state for a capital project and for Ïinancing and directly providing public transportation. Lobbying: making any communication to or appearance before an ofÏicer or employee of any agency, a Member of Congress, an ofÏicer or employee of Congress, or an employee of a Member of Congress in connection with any covered federal action. Local Governmental Authority: includes a political subdivision of a state; an authority of at least one state or political subdivision of a state; an Indian tribe; and a public corporation, board, or commission established under the laws of a state. Master Agreement: The FTA ofÏicial document containing FTA and other cross-cutting federal requirements applicable to the FTA recipient and its project(s). The Master Agreement is generally revised annually in October. The Master Agreement is incorporated by reference and made part of each FTA grant, cooperative agreement, and amendment thereto. Rural / Other than Urbanized / Nonurbanized Area: any area outside of an urbanized area. The term ânonurbanized areaâ speciÏically means an area encompassing a population of less than 50,000 people that has not been designated in the most recent decennial census as an âurbanized areaâ by the Secretary of Commerce. Subrecipient: an entity that receives FTA funds via a pass-through agreement with a direct recipient or designated recipient, whereby the original recipient remains responsible for compliance with all terms, conditions, and requirements associated with the grant. A stateâs FTA subrecipients are typically local governmental authorities, private nonproÏit organizations, and operators of public transportation. Urbanized Area (UZA): an area encompassing a population of not less than 50,000 people that has been deÏined and designated in the most recent decennial census as an âurbanized areaâ by the Secretary of Commerce. Small urbanized areas as used in the context of FTA formula grant programs are urbanized areas with a population of at least 50,000 but less than 200,000, while large urbanized area have with a population of 200,000 or more individuals. Module 2.2: Legal Authority and Annual Certifications LEVEL II - PAGE II-25
SUMMARY OF FTA REQUIREMENTS Subrecipient Legal Authority States are the designated recipient for FTA funds under: ⢠S. 5311 ⢠S. 5310 for rural and small urbanized areas (states can be the designated recipient for large urbanized areas as well) ⢠S. 5307 for small urbanized areas (some states) Local subrecipients must be eligible and authorized under state and local laws to request, receive, and dispense FTA funds and administer FTA-funded projects. The authority to take necessary action and responsibility on behalf of the grantee must be properly delegated and executed. For S. 5310 and S. 5311, each state establishes its own criteria for what constitutes eligibility/authority to receive and administer funds, within the limits of FTA-established eligibility restrictions for each program. States typically verify eligibility for the particular program, such as requiring documentation of nonproÏit status, as part of their subrecipient grant applications. Consult your S. 5310 and S. 5311 State Management Plans as well as the application packages to learn your stateâs program eligibility requirements for these programs. For S. 5307, each recipient must have an authorizing resolution that identiÏies the individuals authorized to act on its behalf. In general, the authority of those ofÏicials acting on behalf of a public body grant applicant must be demonstrated by a resolution from the governing body of the grant applicant, a statute, or an ordinance showing that the grant applicant has authority to Ïile an ofÏicial grant application, showing who has the authority to act on behalf of the applicant, and supporting the application. A certiÏied copy of the authorizing resolution is required for all FTA S. 5307 recipients. FTA only requires the authorizing resolution to be submitted prior to the grant applicantâs Ïirst application. For subsequent grant applications, FTA relies on the annual certiÏications and assurances. To meet this requirement, an authorized person should have signed the Annual CertiÏications and Assurances (discussed later in this module) and the grantee should have attached an Opinion of Module 2.2: Legal Authority and Annual Certifications LEVEL II - PAGE II-26
Counsel (signed by their attorney) afÏirming their legal authority. The annual assurances must also include the date of the granteeâs authorizing resolution and the location where it is on Ïile. Role of the Governing Body and Advisory CommiÆ© ee A noted earlier, the authorizing resolution for S. 5307 recipients must be from the governing body of the grant applicant, a statute, or an ordinance. Certain FTA-required policies and programs, such as Drug and Alcohol, EEO, and Title VI, are required to be adopted by the governing body of each subrecipient. Although not required by FTA, a recommended practice is that each S. 5307 and 5311 subrecipient have an ongoing advisory committee to serve in an advisory capacity for planning FTA-funded service and policy changes. For public transit programs, the committee should include representatives of human service agencies, municipal and county government, private transportation providers, the business community, current customers, and the community at large, including individuals with disabilities. It is also recommended that the committee membership represent the diversity in the local community, including minorities and low income members. Such a committee can play an important role in fostering coordination among specialized transportation providers as well as in the public participation efforts of the subrecipient, and can assist the public transit system by playing an advocacy role in the community. Meetings should be open to the public and minutes should be kept of all advisory committee meetings. Subrecipient CerÆ fi caÆ ons and Assurances Before FTA may award federal funding, an applicant must provide to FTA all certiÏications and assurances required by federal laws and regulations. This is required of all states, and the states in turn pass on the requirement to their subrecipients, typically as part of the grant application. Near the beginning of each federal Ïiscal year, FTA publishes the certiÏications in the Federal Register, highlighting any changes or additions from the previous year. FTA sometimes publishes the certiÏications and assurances on the same date the formula apportionments are published. Module 2.2: Legal Authority and Annual Certifications LEVEL II - PAGE II-27
The authorized representative of the recipient must make the requisite certiÏications. The person signing the annual certiÏications should be the same person/position/title designated in the transit agencyâs authorizing resolution. For S. 5307 recipients, FTA requires a current attorneyâs afÏirmation of the recipientâs legal authority to certify compliance with that Ïiscal yearâs FTA funding assistance. Suspension/Debarment Federal rules impose a statutory requirement on FTA grantees to award contracts made with FTA assistance only to responsible contractorsâthis applies also to your award of a grant to your subrecipients. To prevent fraud, waste, and abuse in federal transactions, persons or entities which, by deÏined events or behavior, potentially threaten the integrity of federally administered non- procurement programs are excluded from participation in FTA-assisted programs. FTA grantees and subrecipients are required to certify that they are not excluded from federally-assisted transactions. The grantees comply with this requirement in their annual certiÏications and assurances with the Debarment/Suspension certiÏications. By signing the annual certiÏication, a grantee certiÏies that the grantee and its principals and subrecipients have not been suspended from federally-assisted transactions. Each grantee is also required to ensure, to the best of its knowledge and belief, that none of its principals, afÏiliates, third party contractors, and subcontractors is suspended, debarred, ineligible, or voluntarily excluded from participation in federally assisted transactions or procurements. FTA requires grantees to review the System for Award Management (SAM) before entering into any third party contract expected to equal or exceed $25,000. Thus, this requirement also must be reviewed as part of the granteeâs procurement process. A good practice is for the grantee to print the screen with the results of the search to include in the grant or procurement Ïile. [Prior to the implementation of SAM, grantees were required to check the excluded parties listing system (EPLS).] 2 CFR Part 180 deÏines a principal as an ofÏicer, director, owner, partner, principal investigator, or other person with management or supervisory responsibilities related to a covered transaction. The grantee should have a similar review process for its principals as it does for its contractors and subrecipients regarding suspension and debarment. Module 2.2: Legal Authority and Annual Certifications LEVEL II - PAGE II-28
Lobbying RestricÆ ons The use of federal funds for lobbying is prohibited. Recipients (and their contractors and subrecipients) receiving federal grants and contracts over $100,000 must certify compliance with this restriction. Section 3.d(1) of FTAâs Master Agreement states that recipients shall not use federal funds to inÏluence or attempt to inÏluence a federal agency ofÏicer/employee, member/ofÏicer/employee of Congress, or employee of a member of Congress. The restriction applies to âcovered federal actions:â the awarding or making of contracts, grants, loans, and cooperative agreements, as well as their extension, continuation, renewal, amendment, or modiÏication. Recipients of federal grants and contracts exceeding $100,000 must certify that they have not and will not make prohibited payments (i.e., paying a lobbyist with federal funds). In the procurement process, recipients are also required to include the lobbying certiÏication in all contracts and procurement solicitations that would exceed $100,000. The lobbying certiÏication does not apply to Indian tribes or tribal organizations. Recipients are permitted to hire a third party (a lobbyist) if they pay for the services with non-federal funds. However, they must submit a disclosure form to FTA, the Standard Form LLL. The form must be submitted every quarter in which lobbying takes place, or every quarter in which there are any changes in the nature of the lobbying activity. This includes a $25,000 or more increase in lobbying activity, a change in the individual who is engaging in the lobbying, or a change in the target of the lobbying. For example, if the lobbyist begins targeting a different member of Congress, the recipient must update this information on the Standard Form. Recipients do not need to disclose lobbying activities undertaken by their own employees, as long as the employees only receive reasonable compensation (deÏined as compensation that is consistent with an employeeâs normal compensation). Employees are also permitted to conduct âagency and legislative liaison activitiesâ that are not related to a speciÏic solicitation, or that occur prior to formal solicitation of covered federal actions. An example of these activities is having a technical discussion with FTA about possible services. States as FTA recipients must obtain signed certiÏications from their subrecipients and contractors. If applicable, they must also obtain the Standard Form LLL and/or the quarterly update from subrecipients and contractors. This means that states are responsible for Module 2.2: Legal Authority and Annual Certifications LEVEL II - PAGE II-29
ensuring that subrecipients Ïile certiÏications and disclosure forms, as well as Ïiling for themselves, and also that subrecipients pass the requirements on to their contractors and subcontractors for awards exceeding $100,000. For both the employees of recipients and others that recipients hire (most likely consultants or trade association representatives), the prohibition does not apply to payments for professional or technical services needed to prepare, submit, or negotiate a bid, proposal, or application. For example, a lawyer can provide legal advice related to his or her clientâs proposal, but cannot âgenerally advocate one proposal over anotherâ [49 CFR 20.205]. The restriction on lobbying comes with penalties. Each use of federal funds for lobbying and each failure to Ïile the disclosure form may result in a Ïine between $10,000 and $100,000. The amount depends on the nature of the violation and if the recipient is a Ïirst time offender. State Oversight of Compliance with Lobbying RestricÆ on ⢠States should educate subrecipients on FTA lobbying restrictions and be able to answer questions on what a subrecipient needs to do to comply with FTA requirements. ⢠States must monitor subrecipient funding levels and contract dollar amounts awarded by subrecipients to determine which subrecipients/subrecipient contracts meet the $100,000 threshold. ⢠States must obtain lobbying certiÏications from all subrecipients meeting FTA thresholds and maintain on Ïile. [Some states may require lobbying certiÏications from other subrecipients, or all subrecipients as part of the grant application package. State DOT staff should be aware when the state requirements are more conservative than FTA requirements in this regard.] ⢠Further, states must require the Standard Form LLL from subrecipients who use non-federal funds for lobbying, and forward these forms to FTA. ⢠States should include review of the subrecipientâs lobbying certiÏication, as well as Standard Form LLL if applicable, as part of compliance reviews of subrecipients conducted by the state. States should also review the subrecipientâs documentation of contractor certiÏications and the Standard Form LLL if applicable. Module 2.2: Legal Authority and Annual Certifications LEVEL II - PAGE II-30
SUPPLEMENTAL NOTES The failure to obtain lobbying certiÏications from subrecipients is a widely reported State Management Review and Triennial Review Ïinding. Recipients may also be cited for providing insufÏicient oversight, having an outdated Standard Form LLL, or not including the certiÏication in agreements/procurement solicitations. In August 2012, FTA issued a Dear Colleague Letter on the subject. TIPS ON RELATIONSHIPS TO OTHER MODULES See the Procurement Module for details on the suspension/debarment and lobbying certiÏications in procurement documents, as well as information on the System for Award Management (SAM). LINKS/INFO Subrecipient legal authority ⢠S. 5307, 5310, 5311 Program Circulars. http://www.fta.dot.gov/about/13716.html Subrecipient certiÏications and assurances ⢠S. 5307, 5310, 5311 Program Circulars. http://www.fta.dot.gov/about/13716.html ⢠FTA CertiÏications and Assurances. http://www.fta.dot.gov/grants/13071.html Module 2.2: Legal Authority and Annual Certifications LEVEL II - PAGE II-31
Role of the Governing Body and Advisory Committee ⢠Boards That Perform, National Rural Transit Assistance Program module (2008). http://web1.ctaa.org/webmodules/webarticles/articleÏiles/BoardsThatPerform_v5_WEB.pdf Suspension/Debarment ⢠20 CFR 180, âOMB Guidelines to Agencies On Governmentwide Debarment and Suspension (Nonprocurement).â http://www.ecfr.gov. ⢠System for Award Management (SAM). www.sam.gov Lobbying ⢠49 CFR 20, âNew Restrictions on Lobbying.â http://www.ecfr.gov. ⢠CertiÏication Regarding Lobbying. See 49 CFR 20, Appendix A. ⢠FTA Master Agreement Section 3.d(1). http://www.fta.dot.gov/documents/19-Master.pdf. ⢠Disclosure of Lobbying Activities (Standard Form LLL). http://www.whitehouse.gov/sites/default/Ïiles/omb/grants/sÏlllin.pdf. ⢠Dear Colleague Letter, âCertiÏications and Disclosure of Lobbying Activities.â August 17, 2012. http://www.fta.dot.gov/ newsroom/12910_14790.html. Module 2.2: Legal Authority and Annual Certifications LEVEL II - PAGE II-32
QUIZ 1. When does FTA require an authorizing resolution to be submitted by a subrecipient to a state? A) Annually B) Prior to the grant applicantâs Ïirst application C) Whenever the grantee applies for a new FTA program D) Never 1) A. 2) B, but only for S. 5307 recipients. 3) B & C. 4) D. 2. FTA requires an ongoing advisory committee for S. 5311 subrecipients. 1) True. 2) False. 3. For which grant program does FTA require a current attorneyâs afÏirmation of the subrecipientâs legal authority? A) S. 5307 B) S. 5310 C) S. 5311 1) A. 2) A & C. 3) all of the above. 4) none of the above. Module 2.2: Legal Authority and Annual Certifications LEVEL II - PAGE II-33
4. Suspension and debarment exclusions are limited to procurement transactions. 1) True. 2) False. 5. Which entity is required to include the lobbying certiÏication in agreements and procurement solicitations? A) A recipient of federal grants and contracts totaling $75,000. B) A tribal organization. 1) A. 2) A & B. 3) Neither. 6. The state DOT is responsible for ensuring that its subrecipients and contractors comply with lobbying requirements.. 1) True. 2) False. 7. Under what circumstances would a recipient NOT need to Ïile a disclosure form? A) The recipient had a cumulative increase in lobbying payments of $10,000 in the past quarter. B) The recipientâs lobbyist began targeting a new member of Congress. C) The recipientâs employee had technical discussions with FTA representatives that were unrelated to a speciÏic contract, grant, loan, or cooperative agreement. 1) A & B. 2) A & C. 3) B & C. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.2: Legal Authority and Annual Certifications LEVEL II - PAGE II-34
KEY CONCEPTS ⢠Interfacing with FTA ⢠Life Cycle of Grant ⢠State Management Plans ⢠Program of Projects ⢠Grant Application Process ⢠Using TEAM-Web ⢠Milestone Progress Reports ⢠National Transit Database ⢠Grant ModiÏications ⢠Grant Close-Out The statutes and regulations governing grants administration and Ïinancial management requirements include: ⢠Federal Transit Laws, Title 49, USC, Ch. 53 ⢠2 CFR Part 225 (OMB Circular A-87), âCost Principles for State, Local, and Indian Tribal Governmentsâ ⢠2 CFR Part 230 (OMB Circular A-122), âCost Principles for Non-ProÏit Organizationsâ ⢠31 CFR Part 205, âRules and Procedures for EfÏicient Federal-State Funds Transfersâ INTRODUCTION This module addresses the FTA grant administration requirements in terms of how states interface with FTA. The basic requirements are that the state must develop an annual program of projects, track and report on the progress of projects, report to the National Transit Database, and close out projects and grants when project activity is completed. It is useful to remember when reviewing this chapter that states have two major roles in administering and managing grants: 1) the grantee to FTA, and 2) the grantor to sub-recipients. State-to-subrecipient grant administration requirements are addressed in the next module in this curriculum. Grant administration is closely related to Ïinancial management, as illustrated in the diagram to the right. New state staff should review this module before proceeding to Subrecipient Grant Administration or either of the Ïinancial management modules. Module 2.3: FTA Grant Administration LEVEL II - PAGE II-35
⢠49 CFR Part 18, âUniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governmentsâ ⢠49 CFR Part 630, âUniform System of Accounts and Records Reporting Systemâ ⢠51 CFR 552, âFederal Agencies Responsible for Cost Negotiation and Audit of State and Local Governmentâ ⢠OfÏice of Management and Budget Open Government Directive - Federal Spending Transparency ⢠P.L. 109-282 Federal Funding Accountability and Transparency Act of 2006 Key guidance documents are: ⢠FTA Master Agreement, Sections 4 - 12 ⢠FTA C 5010.1D - Grant Management Requirements ⢠FTA grant program-speciÏic circulars ⢠National Transit Database Reporting Manual (www.ntdprogram.gov) ⢠FTA TEAM-Web User Guide (http://ftateamweb.fta.dot.gov/static/userguide.html) IMPORTANCE FOR STATE DOT STAFF The FTA grants to your agency need to be managed in order for you, the state, to fund local transit systems. There may be only a few (or one) person in your agency that handles this function as it is fairly specialized. Even if you are not one of those people, it is useful to understand this function and how it is handled within your agency. This is especially true if you have responsibilities with respect to local transit agencies since the FTA grants requirements affect how you will manage how funds Ïlow and are used by your subrecipients. Further, a state may be cited as deÏicient in a State Management Review (SMR) if FTA grant funds allocated to the state are not spent during their period of availability. Such grants may be subject to grant close-out so that the funds can be de-obligated and redistributed to other states. If a state does not allocate Section 5310 and 5311 funding to speciÏic projects before the end of the period of availability (referred to as âlapsed Category C fundsâ), these funds will be de-obligated by FTA. In the simplest terms, states should âuse it or lose it.â Module 2.3: FTA Grant Administration LEVEL II - PAGE II-36
States may also be found deÏicient in a SMR if they do not: submit timely, accurate, and complete reports to FTA; reconcile data in MPRs with FFRs; allocate funds during their period of availability; or initiate grant close-out on a timely basis. DEFINITIONS Program of Projects (POP): A list of projects to be funded in a grant application submitted to FTA by a state or designated recipient. The POP lists the subrecipients and indicates what type of organization they are, a brief description of each project, total project cost, and federal share for each project. TEAM: FTAâs current web-based Transportation Electronic Award and Management system (in use at the time this curriculum was developed). TrAMS is anticipated to replace TEAM beginning in FY 2015. Among other things, grantees apply for grants, inquire about the status of grants, Ïile the required Ïinancial report and milestone progress reports, and submit annual CertiÏications and Assurances in TEAM. TrAMS: FTAâs forthcoming new web-based Transportation Transit Award and Management system, which is anticipated to replace TEAM beginning in FY 2015. SUMMARY OF FTA REQUIREMENTS Interfacing with FTA The primary mechanism with which states interface with FTA is FTAâs web-based grants management system. At the time this curriculum was developed, the system in use is TEAM (Transportation Electronic Award and Management system). However, TEAM will be replaced by TrAMS. FTA anticipates that TrAMS will go live in October beginning in 2014, thus replacing TEAM beginning in FY 2015, with each stateâs electronic records from TEAM migrated into TrAMS. Among other things, grantees apply for grants, inquire about the status of grants, Ïile the required Ïinancial report and milestone progress reports, and submit annual CertiÏications and Assurances in TEAM/TrAMS. When a state staff member needs to interface with a live human being at FTA, this is typically through the FTA Regional OfÏice. Module 2.3: FTA Grant Administration LEVEL II - PAGE II-37
Life Cycle of a Grant Each FTA grant has a life cycle, which is useful to understand before getting into the grants management requirements that apply to various stages of the cycle. An overview of the FTA-to-state grant life cycle is provided in the text box to the right. State Management Plans States must develop and submit a State Management Plan (SMP) to the FTA for the S. 5310 and S. 5311 programs (either stand-alone plans or combined). The SMP details the policies and procedures used to administer the programs. The SMP must be current and reÏlect actual practices, and include the elements outlined in the program circulars. [States will soon need to update their SMPs for MAP-21; at the time this curriculum was drafted, FTA had issued proposed updated circulars for S. 5310 and S. 5311.] For all signiÏicant revisions (i.e., changes in policy that impact subrecipients), FTA requires an opportunity for public comment. The Life of a Grant 1. Planning - Before a state can even apply for FTA funding, it must go through a planning process to identify the projects it proposes to conduct using FTA funding. As a key part of the planning process, local subrecipients apply to the state. The state must determine which local subrecipient projects it plans to fund before the state can apply for FTA funding for these projects. States typically conduct the local process annually or biennially. 2. Program of Projects (POP) - The state develops an annual program of projects (POP). The POP is a compilation of all of the subrecipient projects planned under each FTA funding program, as well as state-level projects, and provides the basis for the stateâs annual funding application. 3. Applying to FTA - The state applies for FTA funding through FTAâs web- based grants management system (beginning in FY 2015, TrAMS; until then, TEAM). 4. FTA Grant Award and Execution - For each FTA program (S. 5310, S. 5311, etc.), FTA awards a single annual grant to the state. Both parties execute the grant agreement. 5. State Management of Grant - Once the grant has been awarded and executed, the grant is now active, and state-level activities can begin that can be reimbursed with grant funding. Throughout a grantâs active life, the state must submit milestone progress reports (MPRs) and Ïinancial reports (FFRs) to FTA. Module 2.3: FTA Grant Administration LEVEL II - PAGE II-38
By explaining (among many other subjects) its processes for enforcement, oversight, and technical assistance, the SMP serves as a guide for subrecipients. Importantly, states use the SMP to outline their methods and criteria for subrecipient project selection. The state must distribute FTA funding on a fair and equitable basis, meaning that all potential subrecipients have a fair opportunity to demonstrate how they meet the stated criteria. Program of Projects Each state prepares an annual program of projects (POP) for each FTA program it administers and submits to FTA. The POP essentially serves as the scope of projects to be funded within each FTA grant to the state and constitutes the scope of the annual grant application to FTA. The POP identiÏies the subrecipients and indicates what type of organization they are, provides a brief description of each project (including their geographic coverage and any tribal transportation needs served), total project cost, and federal share for each project, as well as the amount of funds the state plans to use for state program administration. Each FTA program has program-speciÏic requirements regarding public involvement and consultation with interested parties when developing the POP, which are summarized in the following table: FTA and its grantees must comply with the Federal Funding Accountability and Transparency Act (FFATA) of 2006, Pub. L. 109â282, enacted September 26, 2006. In order to do so, grant recipients must provide FTA with the following information for any subrecipient: the name of the entity receiving the award, the amount of the award, the location of the entity receiving the award, and the primary location of performance under the award, including the city, state, and congressional district. The grant recipient is required to submit this information and may choose to submit it as a separate attachment in the FTA Electronic Grants Management System or include the information in the POP. Module 2.3: FTA Grant Administration LEVEL II - PAGE II-39
FTA Program POP Development Requirements S. 5307 and S. 5339 Either the designated recipient for a UZA or each individual direct recipient is required to: (1) Make available to the public informaÆ on concerning the amount of funds available under the S. 5307 Program and the POP that the recipient proposes to undertake with such funds; (2) Develop a proposed POP for acÆ viÆ es the designated recipient will fi nance, in consultaÆ on with interested parÆ es, including private transportaÆ on providers (and, per the proposed S. 5307 circular, human services organizaÆ ons represenÆ ng the employment-related transportaÆ on needs of welfare recipients and low-income individuals); (3) Publish the proposed POP in suï¬ cient detail and in such a manner as to aï¬ ord aï¬ ected ciÆ zens, private transportaÆ on providers, representaÆ ves of welfare recipients and low-income individuals, and, as appropriate, local elected oï¬ cials, reasonable and adequate opportunity to examine the proposed program and to submit comments on the proposed program and on the performance of the recipient; (4) Provide an opportunity for a public hearing in which to obtain the views of individuals on the proposed POP; (5) Ensure that the proposed POP provides for the coordinaÆ on of S. 5307 public transportaÆ on services with transportaÆ on services assisted from other federal sources; (6) Consider comments and views received, especially those of private transportaÆ on providers, in preparing the fi nal POP; and (7) Make the fi nal POP available to the public. (The proposed circular notes that where there are mulÆ ple designated recipients and/or mulÆ ple MPOs, this public parÆ cipaÆ on requirement may be met in several separate process for the diï¬ erent areas involved. More informaÆ on on the requirements related to the MPO process and coordinated planning, refer to the Local and Regional Planning module of this curriculum or the FTA circular.) S. 5310 The S. 5310 POP must contain an assurance that the program provides for the maximum feasible coordinaÆ on of transportaÆ on services assisted under this secÆ on with transportaÆ on services assisted by other government sources. Projects selected for funding under must be included in a locally developed, coordinated public transit-human service transportaÆ on plan that was developed and approved through a process that included parÆ cipaÆ on by seniors, individuals with disabiliÆ es, representaÆ ves of public, private, nonprofi t transportaÆ on and human service providers, and other members of the public. This coordinated transportaÆ on plan should be prepared through a process that is consistent with the applicable metropolitan or statewide planning process. The POP must be consistent with lisÆ ngs contained in the applicable TIP and STIP. Module 2.3: FTA Grant Administration LEVEL II - PAGE II-40
FTA Program POP Development Requirements S. 5311 A stateâs S. 5311 POP must provide for fair and equitable distribuÆ on of funds in the state, including Indian reservaÆ ons, and provide for maximum feasible coordinaÆ on with transportaÆ on services assisted by other federal sources. If the state does not plan to spend at least 15 percent of its annual S. 5311 apporÆ onment for rural intercity bus service (S. 5311(f)), it must fi rst consult with intercity bus providers and determine that the intercity bus service needs of the state are being met adequately. The S. 5311 POP must be must be a product of the statewide and nonmetropolitan transportaÆ on planning process and/or the metropolitan planning process and included in the STIP. FTA allows states to submit grant applications that include subrecipient projects at various stages of compliance with applicable federal requirements. There are three possible categories or projects, discussed in further detail later in this module: A. Projects in the grant application that have met all federal applicable requirements are approved unconditionally as Category A. B. Projects that have not met all requirements are approved in Category B and funds cannot be disbursed for these activities until requirements are met. The state must notify FTA when projects move from Category B into Category A. C. Projects/activities that have not yet been determined by the state are in Category C. Only S. 5310 and S. 5311 allow the usage of Category C, and no funds should remain in Category C after the period of availability. The state must notify FTA when projects move from Category C into Category A. [Note that the 2013 proposed circulars for S. 5310 and S. 5311 do not include Category C, so this category may be eliminated once the circulars are Ïinalized.] Grant ApplicaÆ on Process FTAâs program-speciÏic circulars describe the grant application process and requirements for each program. States should refer to these circulars for instructions for completing a grant application, which is submitted electronically through the web-based TEAM or TrAMS system. FTA notiÏies states by phone or e-mail of grant approval. States also can check the status of grant applications in TEAM/TrAMS to determine when it has been awarded. The FTA grant agreement includes the notiÏication of award and the approved project budget. Module 2.3: FTA Grant Administration LEVEL II - PAGE II-41
Once the state receives the notiÏication of grant award, the state executes the grant in TEAM/TrAMS. The electronic execution of the FTA grant agreement signiÏies the grant is active. At this point, the state can execute its subrecipient grant agreements for those projects that it has certiÏied as having met all the applicable federal statutory and administrative requirements (both for the project activities and for the subrecipient that will carry out those activities). FTA allows pre-award authority whereby a state can incur costs toward a grant if the project is programmed in the current federally approved State Transportation Improvement Program (STIP) and funds have been appropriated. However, it is the stateâs discretion whether it allows its subrecipients to utilize this pre-award authority provision. Pre-Grant ApplicaÆ on State Planning Requirement All FTA funded projects must be included in the current year of the federally approved STIP. The STIP is a programming document that is developed through the local and statewide planning process and lists projects slated for funding. No project may receive federal funding unless it is included in a current federally approved STIP. Projects selected for small urban areas under the S. 5307, S. 5310 and S. 5339 programs must also be included in the Metropolitan Transportation Improvement Plan (TIP) for the urbanized area. More information on state and MPO planning requirements is provided in the Local and Regional Planning module. Grant ApplicaÆ on Elements The stateâs annual grant application for each program should be prepared in FTAâs web-based TEAM/TrAMS system. The state applies directly to FTA for Sections 5307 (small urban only), 5310 (rural and small urban only, unless the state is the designated recipient for large urban as well), 5311, and 5339 funding and must prepare/submit speciÏic elements that constitute a grant application. These include a POP, Project Budget, Milestones, Environmental Findings, and Warranty Letter to the Department of Labor (S.5311 only). The POP was explained above, and the remaining elements are explained below. ⢠Project Budget - The Project Budget includes activity lines for capital items, operating assistance, project administration, state administration, intercity bus projects, and RTAP activities. A state combines the various subrecipientsâ projects listed Module 2.3: FTA Grant Administration LEVEL II - PAGE II-42
in the POP into standard activity line items (ALIs). The activity line should include federal and total costs, quantities of revenue rolling stock, and a brief description of the activity. For example, all operating assistance funds requested by the various subrecipients listed in the POP would be tallied in one operating assistance activity line item. See the FTA Financial Management module for more information on budgeting. ⢠Milestones - These indicate signiÏicant project events and estimated completion dates for each activity line item. If milestones are not pre-populated by the TEAM system for a particular ALI, use the add function to add milestones for the ALI to the grant application. ⢠Environmental Findings - FTAâs environmental impact regulation requires different levels of analysis and documentation according to the type of project. The majority of projects under these programs will have minimal environmental impacts and are therefore considered categorical exclusions under 23 CFR 771.117(c). ⢠Fleet Status - Fleet status data is not required for S. 5310 grant applications. (The application requirements for this element with regards to the MAP-21 asset management requirements have not yet been determined. States should consult with the current version of TEAM or TrAMS.) ⢠Department of Labor (DOL) Warranty for S. 5311 Only - Non-Urbanized Area grants are covered by a special warranty that protects the interests of employees that may be affected by FTA funded projects. States are required to submit a letter to DOL regarding subrecipient signing of the warranty and labor union information. FTA Categories of Approval After the state submits the annual POP and other application requirements, FTA will review, approve, and obligate funds for the total amount of funds available. FTAâs approval of a POP does not reÏlect unconditional approval of all projects and/or subrecipients identiÏied in the program. Because projects in a stateâs POP may be at the different stages of development, and subrecipients may not be fully in compliance with all Module 2.3: FTA Grant Administration LEVEL II - PAGE II-43
applicable federal requirements, not all applications to the state may be complete at the time the state forwards its annual program of projects to FTA. To expedite grant award, FTA allows states to separate projects and funds included in its POP into three different categories, depending on how completely the subrecipients have met federal requirements. ⢠Category A. Projects in Category A include those projects that the state has certiÏied as having met all the federal statutory and administrative requirements for approval applicable to both the project activities, and to the subrecipient that will carry out those activities. FTAâs approval of Category A projects is unconditional upon grant award. When FTA executes the grant, the state may start drawing down funds to implement projects in Category A. FTA expects most, if not all, of the projects included in the stateâs POP to be in this category. ⢠Category B. Projects in Category B include those projects that the state anticipates approving during the current year, but that have not yet met all federal statutory and/or administrative requirements. For example, a facilities project in Category B may be a project that lacks completion of the environmental review process. Projects may also be in Category B when a subrecipient has not yet met all applicable federal requirements. FTA reserves the right to require the state to defer providing funds to a subrecipient or project that raises serious questions about compliance with civil rights or other requirements, until FTA Ïinds the subrecipient or project in compliance or expressly approves the expenditure of funds involving that subrecipient or project. When the state determines that necessary federal requirements have been satisÏied for a project, FTAâs approval of that project becomes unconditional, and the state may advance the project to Category A. Cash drawdowns for that project may commence after the state advances the project to Category A. In addition, any Category B project that does not qualify as a categorical exclusion (CE) under 23 CFR 771.117(c) requires environmental clearance from FTA before being advanced to Category A. ⢠Category C. The state may include S. 5310 and S. 5311 funds in Category C to assist projects that it has not yet identiÏied at the time it submits its grant application. Category C represents a âprogram reserveâ unique to the S. 5310 and S. 5311 programs. It is designed to allow the state to obligate its entire apportionment in one grant, even if the funds are not completely programmed. The state should not use Category C funds for project contingencies; these should be programmed in Category A or B. Category C funds may, however, supplement previously identiÏied projects where original cost estimates were inadequate. Module 2.3: FTA Grant Administration LEVEL II - PAGE II-44
Once funds have been programmed in Category A or B, they should not be reprogrammed as Category C. [Note that the 2013 proposed circulars for S. 5310 and S. 5311 do not include Category C, so this category may be eliminated once the circulars are Ïinalized.] The state may not include more than 10 percent of the total amount it obligates in the S. 5310 or S. 5311 grant in Category C. FTA expects the state to allocate all funds in Category C to either new approvable projects or to budget adjustments in existing Category A and B projects within 12 months of grant approval. If the state does not expect to program the funds within that time period, obligation should be deferred until the following year. If Category C funds are not allocated within the period of availability, FTA will deobligate and redistribute the funds to all states. When a state selects projects it will advance out of the Category C program reserve funds, it must notify FTA of the changes to the program of projects. Any new project that does not qualify as a CE under 23 CFR 771.117(b) requires environmental clearance from FTA before the state advances the project to Category A. Using TEAM-Web The TEAM User Guide can be found at FTAâs website in the âGrants and Financingâ section under âApply for and Manage Grantsâ located at: http://ftateamweb.fta.dot.gov/static/userguide.html. However, as noted at the beginning of in this module, TEAM will soon be replaced by TrAMS. FTA anticipates that TrAMS will go live in October beginning in 2014, thus replacing TEAM beginning in FY 2015, with each stateâs electronic records from TEAM migrated into TrAMS. A TrAMS user guide is likely to be made available through the FTA website when this transition happens. Milestone Progress Reports The state has ongoing reporting requirements for each active grant, including a Federal Financial Report (FFR) and the Milestone/ Progress Report (MPR) submitted annually or quarterly, depending upon the speciÏic grant. General due dates are indicated following the descriptions of the FFR and MPR. Module 2.3: FTA Grant Administration LEVEL II - PAGE II-45
FTA reporting requirements may vary depending on the size of the grantee, the type of funding, or the amount of funding a grantee receives. FTA uses these reports to monitor grant status and compliance elements, such as: ⢠The purposes of the grant are being achieved; ⢠The project is progressing on time and within budget; ⢠The grantee is demonstrating competence and control in executing the project; ⢠The project meets all program requirements; ⢠Any problems developing that may require FTA resources to resolve. The state should have procedures for coordinating the development of and reconciling the data in MPRs and FFRs before submitting them to FTA, and follow these procedures. The FTA requirements for FFRs are described in the FTA Financial Management module, and for the MPRs are described below. The MPR is the primary written communication between the grantee and FTA. For each active/executed grant, the state must submit an MPR that accompanies the FFR. This report is submitted electronically in TEAM/TrAMS, by the due dates described below. Section 5305, 5307, and 5309 MPRs must include: 1. Current status of each open activity live item (ALI) within the active/executed grant. 2. A narrative description of projects, status, any problems encountered in implementation, speciÏication preparation, bid solicitation, resolution of protests, and contract awards. With respect to the level of detail required for these reports, FTA treats all approved activity line items (ALIs) alike. Thus, an activity contained in a grant must be presented in the reports in sufÏicient detail that important information is not lost in aggregation. For example, the number of full-sized buses in a grant must not be reported together with vans under the scope ârolling stock,â but instead should be reported separately under the applicable ALI. 3. Detailed discussion of all budget or schedule changes. 4. The dates of expected or actual requests for bid, delivery, etc. (If only operating assistance is included in the grant, the reporting requirements are limited to the estimated and actual dates when all funding has been expended.) Module 2.3: FTA Grant Administration LEVEL II - PAGE II-46
5. Actual completion dates for completed milestones. 6. Revised estimated completion dates when original estimated completion dates are not met. 7. Explanation of why scheduled milestones or completion dates were not met. IdentiÏication of problem areas and narrative on how the problems will be solved. Discussion of the expected impacts and the efforts to recover from the delays. 8. Analysis of signiÏicant project cost variances. Completion and acceptance of equipment and construction or other work should be discussed, together with a breakout of the costs incurred and those costs required to complete the project. Use quantitative measures, such as hours worked, sections completed, or units delivered. 9. A list of all outstanding claims exceeding $100,000, and all claims settled during the reporting period. This list should be accompanied by a brief description, estimated costs, and the reasons for the claims. 10. A list of all potential and executed change orders and amounts exceeding $100,000, pending or settled, during the reporting period. This list should be accompanied by a brief description. 11. A list of claims or litigation involving third party contracts and potential third party contracts that: a. Have a value exceeding $100,000, b. Involve a controversial matter, irrespective of amount, or c. Involve a highly publicized matter, irrespective of amount. 12. A list of all real property acquisition actions, including just compensation, property(s) under litigation, administrative settlements, and condemnation for each parcel during the reporting period. Section 5310 and 5311 MPRs must include: a. Updated POPs that contain active projects reÏlecting revised project descriptions, changes in projects from one category to another, and adjustments within budget categories. b. Revised milestones for activity line items (ALIs) that require milestones with grant submission (vehicle procurements, construction projects, and program reserve) and, for revised estimated completion dates, an explanation for the revision. c. Budget revisions for changes in line item budgets. d. SigniÏicant civil rights compliance issues. e. Additional information requested by the regional ofÏice. Module 2.3: FTA Grant Administration LEVEL II - PAGE II-47
If necessary, attachments can accompany FFRs and MPRs by using the âpaperclipâ feature in TEAM. (TrAMS will also have document upload capability. ) FFR/MPR ReporÆ ng Due Dates ⢠For each open state S. 5309 grant that includes construction of a facility, the FFR and MPR are due quarterly, no later than 30 days after the end of each federal Ïiscal quarter (i.e., by January 30, April 30, July 30, and October 30). ⢠For all other open state grants, the FFR and MPR are due annually by October 31st for the preceding Federal Fiscal Year (October 1- September 30). ⢠Reports are due even when there is no grant activity. ⢠FTA may withhold payment for failure to submit either FFRs or MPRs in a timely manner. In individual cases, FTA may grant extensions of report due dates for good cause. NaÆ onal Transit Database The National Transit Database (NTD) is FTAâs primary national database for statistics on the transit industry. Recipients of FTA S. 5311 grants are required to submit an annual NTD report for all S. 5311 beneÏiciaries and subrecipients. [This requirement also applies to recipients of Congestion Mitigation and Air Quality Improvement Program (CMAQ) and Surface Transportation Program (STP) funds that are âÏlexedâ into the 5311 program.] The report due date is tied to the granteeâs Ïiscal year. NTD reports are typically due as follows: Fiscal Year End Date (Between) NTD Report Due Date January 1 and June 30 October 31 July 1 and September 30 January 31 October 1 and December 30 April 30 Module 2.3: FTA Grant Administration LEVEL II - PAGE II-48
Subrecipients of FTA S. 5307 grants submit their NTD reports directly to FTA. FTA uses some of the validated data from the latest report year for S. 5307 formula apportionments. For purposes of the formula, FTA may not use data that is submitted late or data that it cannot validate. Reporting instructions are provided annually on the NTD website at www.ntdprogram.gov. Grant Modifi caÆ ons After grant approval, the state can still make revisions to the POP and project budget. Grant modiÏications are electronically submitted, reviewed, and approved in TEAM/TrAMS. There are three ways to modify a grant after it has been awardedâeither through a budget revision, an administrative amendment, or a grant amendment . Whether a budget revision may be permitted (with or without prior FTA approval before incurring costs) or whether an amendment to the project will be necessary, depends on the effect of the proposed change on the scope of the project. Budget Revisions Budget revisions may be made as long as there is no change in the grant purpose, project scope coding in TEAM/TrAMS, or Federal funding of the grant, regardless of the FY the funds were appropriated. Budget revisions are generally changes to ALIs amounts or descriptions. Budget revisions must be consistent with the activities contained in an approved TIP and STIP and satisfy applicable National Environmental Policy Act (NEPA) requirements. Useful life of new activities must be addressed in the budget revision, as applicable. At any time, the states are allowed to make revisions to their Section 5310 and 5311 POP as long as the revisions do not constitute a change in the project scope (which would require the deobligation and reobligation of funds). Moving projects from Category C or B, reallocating funds within the approved POP, creating new capital or operating projects with funds from other projects in the approved POP, and allocating funds from Category C to new projects are allowable revisions. The scope of the grant is the approved POP in its entirety. The addition of federal funds to the approved POP is a change in the scope and requires an amendment of the grant agreement. Revisions that constitute a change in the project scope are only allowed during the period of availability. Module 2.3: FTA Grant Administration LEVEL II - PAGE II-49
For changes that affect the budget line items in the grant budget, the grantee will notify FTA by setting up a budget revision in TEAM/ TrAMS. For those changes that only affect the POP (and not the project scope), the grantee should attach a new POP to the âproject management milestonesâ section and then notify FTA via e-mail. In addition, grantees should also notify FTA of changes to the POP when they submit their annual program status report. Under certain circumstances, a grantee must obtain FTA approval before incurring costs for proposed budget revisions. For these grants, the proposed budget revision must be submitted in TEAM and approved before incurring costs associated with the budget revision. If FTA determines the proposed budget revision does not meet the budget revision criteria, alternate methods for modifying the grant, such as a grant amendment, may be recommended. AdministraÆ ve Amendments An administrative amendment is a minor change in a grant agreement normally initiated by FTA to modify or clarify certain terms, conditions, or provisions of a grant. Grant Amendments A grant amendment is required when there is either a change in the scope or an addition of federal funds to an existing grant. One example of a change in scope would be changing the use of the grant from facility development to the purchase of vehicles. Grant amendments are subject to the same application requirements as a new grant request. All grant amendments are subject to DOL certiÏication. For more information, including circumstances in which a budget revision requires FTA approval, see Chapter III of FTA C5010.1D. States should contact the FTA regional ofÏice for questions relating to grant modiÏication requests, including which type of grant modiÏication is appropriate for the proposed action. Grant Close-out States should close out their grants with FTA within 90 days of completion of program activity, following close out of all subrecipient projects. A Ïinal Financial Status Report (FSR), budget, and milestones report should be electronically submitted. Module 2.3: FTA Grant Administration LEVEL II - PAGE II-50
TIPS ON RELATIONSHIPS TO OTHER MODULES This module is very closely related to Subrecipient Grant Administration, FTA Financial Management, and Subrecipient Financial Management. LINKS/INFO ⢠49 CFR Part 18, âUniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governments.â http://www.ecfr.gov ⢠OfÏice of Management and Budget Open Government Directive - Federal Spending Transparency. http://www.whitehouse.gov/ sites/default/Ïiles/omb/assets/memoranda_2010/m10-06.pdf ⢠P.L. 109-282 Federal Funding Accountability and Transparency Act of 2006. http://www.gpo.gov/fdsys/pkg/PLAW- 109publ282/pdf/PLAW-109publ282.pdf ⢠FTA C 5010.1D - Grant Management Requirements. http://www.fta.dot.gov/about/13716.html ⢠FTA Grant program-speciÏic circulars. http://www.fta.dot.gov/about/13716.html ⢠National Transit Database Reporting Manual. www.ntdprogram.gov ⢠FTA TEAM-Web User Guide. http://ftateamweb.fta.dot.gov/static/userguide.html ⢠FTA TEAM-Web Access Portal. https://ftateamweb.fta.dot.gov/teamweb/ Module 2.3: FTA Grant Administration LEVEL II - PAGE II-51
QUIZ 1. When amending the State Management Plans, for which program(s) does FTA require an opportunity for public comment for signiÏicant changes? A) S.5307 B) S.5310 C) S.5311 1) A. 2) B & C. 3) C. 4) none of the above. 2. A state that plans to spend more than 15 percent of its annual S. 5311 apportionment for rural intercity bus service (S. 5311(f)) must hold a public hearing on the S. 5311 POP. 1) True. 2) False. 3. Projects in Category B include those projects that the state anticipates approving during the current year, but that have not yet met all federal statutory and/or administrative requirements. 1) True. 2) False. Module 2.3: FTA Grant Administration LEVEL II - PAGE II-52
4. Which of the following compliance elements does FTA use MMRs and FFRs? A) The purposes of the grant are being achieved; B) The project is progressing on time and within budget; C) The grantee is demonstrating competence and control in executing the project; D) The project meets all program requirements; E) Any problems developing that may require FTA resources to resolve. 1) A & B. 2) A, B & E. 3) all of the above. 4) none of the above. 5. Following close-out of all subrecipient projects, states should wait at least 90 days before initiating grant closeout. 1) True. 2) False. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.3: FTA Grant Administration LEVEL II - PAGE II-53
KEY CONCEPTS ⢠Subrecipient Grant Applications ⢠Subrecipient Funding Allocations/Project Selection ⢠Subrecipient Grant Agreements ⢠Subrecipient Reporting and Tracking ⢠Subrecipient Project Close-Out ⢠49 CFR Part 18, âUniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governmentsâ ⢠OfÏice of Management and Budget Open Government Directive - Federal Spending Transparency ⢠P.L. 109-282 Federal Funding Accountability and Transparency Act of 2006 INTRODUCTION This module addresses FTA grant administration requirements related to allocating funds to subrecipients, subrecipient grant applications and agreements, subrecipient reporting requirements, and project/grant close out when project activity is completed, as well as the stateâs role in oversight of these requirement areas. Prior to reviewing this module, it is recommended that state staff review the FTA Grant Administration module. Subrecipient grant administration is also closely related to Ïinancial management, as illustrated in the diagram to the right. The statutes and regulations governing grants administration and Ïinancial management requirements include: ⢠Federal Transit Laws, Title 49, USC, Chapter 53 ⢠2 CFR Part 225 (OMB Circular A-87), âCost Principles for State, Local, and Indian Tribal Governmentsâ ⢠2 CFR Part 230 (OMB Circular A-122), âCost Principles for Non-ProÏit Organizationsâ Module 2.4: Subrecipient Grant Administration LEVEL II - PAGE II-54
Key guidance documents are: ⢠FTA Master Agreement ⢠FTA C 5010.1D - Grant Management Requirements (Rev. 1, August 27, 2012) ⢠FTA Grant program-speciÏic circulars ⢠National Transit Database Reporting Manual (www.ntdprogram.gov) ⢠Your stateâs State Management Plan (SMP) ⢠Your stateâs subrecipient grant application package, policies, and procedures ⢠Your stateâs subrecipient grant agreements ⢠Other guidelines provided by your state to your subrecipients IMPORTANCE FOR STATE DOT STAFF This function is important to you since it represents the core function of your divisionâmaking sure that your subrecipients, local transit agencies, have access to the federal dollars they need to provide public transit in their communities. Most state transit staff members are involved in this function at some level. Further, your state may be cited as deÏicient in a State Management Review (SMR) if it does not comply with each FTA requirement. The state oversees its subrecipients, and is responsible for ensuring that subrecipient projects are completed on time and that data are reported as needed for the stateâs reports to the FTA. DEFINITIONS Please refer to the deÏinitions in the FTA Grant Administration module. Module 2.4: Subrecipient Grant Administration LEVEL II - PAGE II-55
SUMMARY OF FTA REQUIREMENTS The Life of a Subrecipient Grant Each FTA grant has a life cycle, which is useful to understand before getting into the grants management requirements that apply to various stages of the cycle. It is also useful to remember that states have two major roles in administering and managing grants: 1) the grantee to FTA (described in the FTA Grant Administration module), and 2) the grantor to subrecipients (described in this module). An overview of the state-to-subrecipient grant life cycle is provided in the following text box. The stateâs grants to subrecipients have their own life cycle embedded within the active FTA-to-state life cycle. The Life of a Subrecipient Grant a. Subrecipient Planning - States generally require some type of planning activities from subrecipients. Requirements may vary by FTA program. b. Subrecipient Application - The state relies on the subrecipient applications to develop the stateâs POP (stage 2 of the FTA-to-state grant life cycle). c. State Application to FTA on Behalf of the Subrecipients - This happens in stage 3 of the FTA-to-state grant life cycle. d. State Grant Award and Execution - After the state has received the state grant from the FTA, the state executes its own grants to the subrecipients. This and the rest of the subrecipient grant activities fall within stage 5 of the FTA-to-state grant life cycle. e. Subrecipient Project Activity - The subrecipient conducts the project activities and incurs project costs. f. Subrecipient Submittals to State - The subrecipient submits requests for reimbursement and supporting documentation, and project progress reports to the state. These submittals provide the basis for the next step. g. State Submittals to FTA - The state submits Federal Financial Reports (FFRs) and Milestone/Progress Reports (MPRs) to FTA through TEAM/TrAMS. h. FTA to State to Subrecipient Reimbursement - Once the state receives dollars from FTA, the state reimburses its subrecipient. i. State Close-out of Subrecipient Grant - The state monitors subrecipient grant activity and project milestones. Once the project is complete (or, for inactive grants, when the funding availability is due to expire), the state initiates grant close-out with the subrecipient. Once the grant is closed out, the funds are no longer available to the subrecipient. Module 2.4: Subrecipient Grant Administration LEVEL II - PAGE II-56
Subrecipient Grant ApplicaÆ ons States typically have a subrecipient grant application process for determining which projects should receive FTA grant funding. States develop their own local grant application policies, procedures, formats, and means of submission. Some states require a separate application for each FTA and state funding program. Others have a consolidated or partially consolidated application. Common elements required by states in their subrecipient grant applications include: ⢠Applicant description (demonstration of eligibility to apply for speciÏic funds) ⢠Detailed project description ⢠Project budget and sources of local match ⢠Project justiÏication (demonstration of need) ⢠Documentation of public notice/comment, private sector notiÏication, coordination, and any other planning activities required for the grantâFTA requirements vary by grant, and your state may have additional requirements ⢠Information on the applicantâs overall transportation program, services and assets, including service descriptions, brochures, operating statistics, vehicle inventory, overall program budget, etc. This may be a mix of narrative description and tables with numerical data. ⢠Information on the applicantâs support functions such as vehicle maintenance, safety and security program, training program, transit marketing program, etc. ⢠Information on the applicantâs administrative, technical, and Ïinancial capacity ⢠Documentation of compliance with FTA requirements ⢠CertiÏications and assurancesâthose that apply to FTA grants as well as any state-speciÏic requirements States typically rely on subrecipient grant applications for developing their own Program of Projects (POP) for the stateâs application to FTA. Many states also use the subrecipient grant application process as a means of monitoring subrecipients for FTA compliance, particularly under those grant programs for which subrecipients submit an annual application. Please refer to your stateâs application packages and State Management Plans (SMPs) for information on your stateâs subrecipient grant application processes. Module 2.4: Subrecipient Grant Administration LEVEL II - PAGE II-57
Subrecipient Funding AllocaÆ ons/Project SelecÆ on State Project SelecÆ on Criteria Each FTA grant program has its own set of requirements related to how states should distribute funds among local projects. Each state determines its own subrecipient funding allocation formulas and project selection criteria for the FTA and state grant programs it administers. States are generally given broad discretion on how they design their local project selection process, so long as their process meets the federal requirements, which are listed below for each FTA program. Please consult your stateâs SMPs and subrecipient application packages to learn about your stateâs criteria processes. SecÆ on 5310 When selecting projects for the S. 5310 program, states need to: ⢠Determine applicant and project eligibility; ⢠Allocate funds to subrecipients on a fair and equitable basis; ⢠Select projects based on criteria consistent with the coordinated planning process (typically a competitive process); ⢠Certify that all projects are included in a locally developed, coordinated public transit-human service transportation plan developed and approved through a process that included participation by seniors, individuals with disabilities, representatives of public, private, and non-proÏit transportation and human service providers, and other members of the public; ⢠Certify that to the maximum extent feasible, services funded under S. 5310 are coordinated with transportation services assisted by other federal departments and agencies; and ⢠Ensure that at least 55 percent of an areaâs apportionment is used for âtraditionalâ S. 5310 projects, which are âpublic transportation projects planned, designed, and carried out to meet the special needs of seniors and individuals with disabilities when public transportation is insufÏicient, inappropriate, or unavailable.â (The above list is based on FTA C 9070.1G, the proposed S. 5310 circular). Module 2.4: Subrecipient Grant Administration LEVEL II - PAGE II-58
SecÆ on 5311 When selecting projects for the S. 5311 program, states need to: ⢠Provide for fair and equitable distribution of the apportionment in the state, including Indian reservations. ⢠Allocate at least 15 percent of its annual S. 5311 apportionment âto carry out a program to develop and support intercity bus transportationâ (the S. 5311(f) program), unless the governor certiÏies that âthe intercity bus service needs of the state are being met adequately.â ⢠Provide for maximum feasible coordination with other public transportation services assisted by other federal sources. (The above list is based on FTA C 9040.1F, the pre-MAP-21 S. 5311 circular). SecÆ on 5307 States which are the designated recipients for small urbanized areas under the S. 5307 program also have allocation considerations for this program. Although FTA allocates the total amount of S. 5307 funding to each urbanized area each year based on an allocation formula, states still have the responsibility for selecting speciÏic projects in the small urbanized areas. States need to: ⢠Allocate the relevant apportionment among eligible subrecipients in the urbanized area or areas based on local needs and arrangements, and in coordination with the Metropolitan Planning Organization (MPO). Eligible S. 5307 subrecipients include: -public entities otherwise eligible to become direct recipients under S. 5307, and -private non-proÏit operators of eligible job access and reverse commute projects. ⢠Identify and select the projects (capital, operating, job access and reverse commute, or planning) that the MPO or state DOT will include in a metropolitan transportation plan, Transportation Improvement Program (TIP), Statewide Transportation Improvement Program (STIP), and/or UniÏied Planning Work Program (UPWP). ⢠Ensure that, in the annual POP: -at least one percent of the apportionment is used for associated transit improvements (formerly known as âtransit enhancementsâ; see FTA C9030.1E [pages IV-3 to IV-4 for a list what qualify for this one percent], and Module 2.4: Subrecipient Grant Administration LEVEL II - PAGE II-59
-at least one percent is used for public transportation security projects (unless all security needs are certiÏied as being met). (The above list is based on FTA C 9030.1E, the proposed S. 5307 circular). Title VI as an Overarching Principle âFair and equitableâ is not only a concept required at the program level; states must also ensure that distribution of funding does not violate Title VI of the Civil Rights Act, and must have procedures for assuring equity of distribution of beneÏits among groups within the state. The requirements of Title VI as they apply to subrecipients are described in a stand-alone module of this curriculum. Subrecipient Grant Agreements A state-to-subrecipient grant agreement is executed by the state for each subrecipient project selected for FTA funding. The agreement typically spells out the project(s) to be funded, the amount of federal funding provided (as well as any state funds to be used in the project), the local match the subrecipient must provide, and the gamut of federal requirements with which the subrecipient agrees to comply in accepting FTA funds. Some states refer to subrecipient grant agreements as contracts; however, FTA does not consider such agreements to be contracts. This is an important distinction, since there are FTA rules related to contracts (and procuring contracts) that do not apply to subrecipient grant agreements. However, like a contract, the grant agreement comes with legal obligations. A state will wait to execute its grant agreements with subrecipients until after it has executed its grant agreement with FTA for those funds which will be passed on to the subrecipients, since states are not permitted to incur expenses before a grant is awarded. Exceptions to this may be subrecipient grants in which the state is providing its own match and can draw down its own funds to reimburse subrecipients prior to FTA award, or when the state has received Pre-Award Authority from FTA. Typically, states issue subrecipients separate capital and operating agreements, since these are linked to the stateâs grants with FTA, and FTAâs grant category segregation. Module 2.4: Subrecipient Grant Administration LEVEL II - PAGE II-60
Subrecipient ReporÆ ng and Tracking Each state establishes its own Ïinancial and project progress reports required for its subrecipients, as well as reports on data needed for rural NTD submission. State staff who are responsible for preparing the MPRs and FFRs for FTA should review subrecipient reports to ensure that: ⢠the required local match has been provided, and comes from an allowable source ⢠the expenses for which reimbursement is requested are eligible for funding under the grant/project ⢠the operating data, project progress reports, and accompanying documentation adequately support/justify the amount of reimbursement requested by the subrecipient. For more information, refer to your stateâs SMPs, subrecipient grant agreements, and other subrecipient guidance. Subrecipient Project Closeout The state must close out subrecipient projects within 90 days of completion of project activities (after all funds are expended and/ or all work activities for the project are completed). State close-out of its own grants from FTA is contingent upon Ïirst closing out its subrecipient grants. States need to closely monitor subrecipients to ensure that grant activities are completed in accordance with the project scope and that disbursement of FTA funds are requested in a timely manner. Please refer to your stateâs SMP or standard operating procedures to learn more about how project funds are tracked and how to intitiate close out once all funds are spent or the project is otherwise completed. Module 2.4: Subrecipient Grant Administration LEVEL II - PAGE II-61
TIPS ON RELATIONSHIPS TO OTHER MODULES This module is very closely related to FTA Grant Administration, FTA Financial Management, and Subrecipient Financial Management. LINKS/INFO ⢠FTA Circulars. http://www.fta.dot.gov/about/13716.html ⢠National Transit Database Reporting Manual (www.ntdprogram.gov) QUIZ 1. FTA is prescriptive in what constitutes fair and equitable distribution among Section 5310 applicants. 1) True. 2) False. 2. FTA requires subrecipients to complete which of the following reporting forms? A) Milestone/Progress Reports B) Federal Financial Reports C) National Transit Database Reports 1) A & C. 2) B & C. 3) A, B, & C, but only on an annual basis. 4) none of the above. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.4: Subrecipient Grant Administration LEVEL II - PAGE II-62
KEY CONCEPTS ⢠Budgeting ⢠Accounting ⢠Financial Reporting and Financial Status Reports ⢠Funds Management ⢠Federal Financial Interest in Assets Agreements to State and Local Governmentsâ ⢠49 CFR Part 630, âUniform System of Accounts and Records Reporting Systemâ ⢠51 CFR 552, âFederal Agencies Responsible for Cost Negotiation and Audit of State and Local Governmentâ ⢠OfÏice of Management and Budget Open Government Directive - Federal Spending Transparency ⢠OMB Circular A-133, âAudits of States, Local Governments, and Non-ProÏit Organizationsâ INTRODUCTION This module addresses FTA requirements related to how the state manages FTA funds. The state must demonstrate the ability to match and manage FTA grants and expend FTA funds only on eligible activities. Prior to reviewing this module, it is recommended that state staff review the FTA Grant Administration module. Financial management is closely related to grant administration, as illustrated in the diagram to the right. The statutes and regulations governing Ïinancial management requirements include: ⢠Federal Transit Laws, Title 49, USC, Chapter 53 ⢠2 CFR Part 225 (OMB Circular A-87), âCost Principles for State, Local, and Indian Tribal Governmentsâ ⢠2 CFR Part 230 (OMB Circular A-122), âCost Principles for Non-ProÏit Organizationsâ ⢠31 CFR Part 205, âRules and Procedures for EfÏicient Federal-State Funds Transfersâ ⢠49 CFR Part 18, âUniform Administrative Requirements for Grants and Cooperative Module 2.5: FTA Financial Management LEVEL II - PAGE II-63
⢠P.L. 109-282 Federal Funding Accountability and Transparency Act of 2006 ⢠Single Audit Act Amendment of 1996 Key guidance documents are: ⢠FTA Master Agreement ⢠FTA C 5010.1D - Grant Management Requirements ⢠FTA Grant program-speciÏic circulars ⢠ECHO Web User Manual for FTA and FAA grantees (http://www.fta.dot.gov/documents/ECHO_Web_Grantee_User_Manual_ May_21_2012_version_2.4.pdf) ⢠FTA ECHO Web User Manual 2012 (http://www.fta.dot.gov/documents/ECHOWebGranteeUserManual.pdf) ⢠FTA TEAM-Web User Guide (http://ftateamweb.fta.dot.gov/static/userguide.html) IMPORTANCE FOR STATE DOT STAFF A state may be cited as deÏicient in a State Management Review (SMR) if it does not comply with each FTA requirement. Without sufÏicient local match funding, the state may not be able to draw down all FTA funds. Funds which are not obligated during their period of eligibility to the state will be deobligated by FTA for reallocation to other states. DEFINITIONS Accrual Basis of Accounting: The accounting method where income is recorded when earned instead of when received, and expenses are recorded when incurred instead of when paid. FTA requires the Federal Financial Report (FFR) to be prepared in the accrual method of accounting. Activity Line Item (ALI): The description and dollar amount contained in the budget for an approved grant activity associated within Module 2.5: FTA Financial Management LEVEL II - PAGE II-64
a particular scope approved as part of a grant. ALIs under each scope are informational and are used as tools for FTA and the grantee to manage the grant. Depreciation: Method used to calculate the reduction in value of an item of personal or real property over time. Is the term most often used to indicate that personal property has declined in service potential. It is also a method of determining fair market value when disposing of an asset prior to the end of its useful life. Electronic Clearing House Operation (ECHO): ECHO is a web-based application that processes draw down requests and makes payments to FTA grantees. Fair Market Value: The most probable price equipment or project property would bring in a competitive and open market. Obligate/De-obligate: To bind or commit grant funds to a project/to undo this commitment Program of Projects (POP): A list of projects to be funded in a grant application submitted to FTA by a designated recipient. The POP lists the subrecipients and indicates whether they are private non-proÏit agencies, governmental authorities, or private providers of transportation service, designates the areas served (including rural areas), and identiÏies any tribal entities. In addition, the POP includes a brief description of the projects, total project cost, and federal share for each project. Project: For the purposes of the FTA program, public transportation improvement activities funded under an executed grant. SUMMARY OF FTA REQUIREMENTS BudgeÆ ng A budget is an estimate of income and expenditures related to a particular organization, program, or project for a set period of time. It is an important tool for short-range planning, monitoring, and controlling the direction and outcome of the organization, program, or Module 2.5: FTA Financial Management LEVEL II - PAGE II-65
project. State FTA program managers are challenged with developing budgets that address FTA grant requirements while Ïitting into the stateâs own budgeting processes, and also incorporating subrecipient grant/project budgets into the stateâs POP. FTA Budget Structure Typically, a state is awarded one grant per year for each formula programs such as S. 5310 and S. 5311. Within that grant, the state will have multiple projects. In the stateâs interface with FTA, subrecipient grants are considered projects. At both the âmacroâ level and project level, the budget must include an overall sum of expenses, and revenues to cover those expenses that comply with FTA requirements. Each FTA grant program, and each type of grant within a program (capital, operating, planning, administration) has a different maximum federal share. FTA dollars can be no higher than the allowable federal share for each type of project; the remainder of the expenses must be covered by local match, and, in the case of operating projects, operating revenues such as farebox or advertising revenue collected by the subrecipient. For more information on subrecipient budgeting and local match requirements, refer to the Subrecipient Financial Management module. In the POP and application to FTA, project budgets include âactivity linesâ for capital items, operating assistance, project administration, state administration, and, under S. 5311, intercity bus projects and Rural Transit Assistance Program (RTAP) activities. A state combines the various subrecipientsâ projects listed in the POP into standard activity line items (ALIs). For example, all operating assistance funds requested by the various subrecipients listed in the POP would be tallied in one operating assistance activity line item. The Budget Cycle FTA grant budgets are typically prepared by state DOTs on an annual basis, and submitted as part of the annual grant application. States prepare an overall budget for each FTA grant program that includes subrecipient projects as well as speciÏic state-level projects to be funded by that grant. These projects are aggregated into a POP for each grant. At the federal level, FTA grant programs are apportioned to programs and allocated to states for the 12-month period of October Module 2.5: FTA Financial Management LEVEL II - PAGE II-66
1 through September 30 (the federal Ïiscal year). State allocations for the upcoming Ïiscal year are typical published in the Federal Register in early October. Once this notice is published, the state knows how much FTA funding (total by grant) is available to the state (including its subrecipients) for the next 12 months, and the state can prepare its FTA grant budgets, obligating the funds FTA allocates to it, and allocating those funds to its own subrecipients. Although each FTA grant is awarded in a speciÏic Ïiscal year, depending on the program and project type, a grant may span multiple federal yearsâwhich is almost always the case with state grants that include subrecipient projects, since there will usually be lag time in awarding subgrants to the subrecipients. Generally state transit budgets include state funds from the current Ïiscal year but may include federal funds from previous year(s). Also, capital projects, particularly those that involve facility construction or procurement of transit vehicles, often span multiple years simply due to the amount of time it takes to complete these types of projects. Each state government has its own overall budget process that will impact how and when a stateâs transit program prepares its internal budget. Some states have a biennial process, which means the transit program needs to estimate its grant budgets two years in advance. AccounÆ ng The Common Rule requires that the state (and its subrecipients) have Ïiscal control and accounting procedures sufÏicient to permit preparation of required reports, and permit the tracing of funds to a level of expenditures adequate to establish that such funds have not been used in violation of the restrictions and prohibitions of applicable statutes. States must be able to trace reimbursements to source documents (including subrecipient documentation; the granteeâs records must support ECHO requests). The information should be traced back to an invoice for goods or services or timesheets, and be supported by information from the granteeâs accounting system. Financial ReporÆ ng and Financial Status Reports As described in the FTA Grant Administration module, the state has ongoing reporting requirements for each active grant, including the Federal Financial Report (FFR) and the Milestone/Progress Report (MPR) submitted annually or quarterly, depending upon Module 2.5: FTA Financial Management LEVEL II - PAGE II-67
the speciÏic grant. The state should have procedures for coordinating the development of and reconciling the data in MPRs and FFRs before submitting them to FTA, and follow these procedures. The FTA requirements for MPRs are described in the FTA Grant Administration module, and for FFRs are described below. Federal Financial Reports (FFR) The purpose of the FFR (Standard Form (SF) 425) is to provide a current, complete, and accurate Ïinancial picture of the grant. For each active/executed grant, the state must submit an FFR that accompanies the MPR. This report is submitted electronically in TEAM/ TrAMS, by the due dates described below. FTA requirements and guidelines for the FFR include: ⢠The FFR must be prepared on the accrual basis of accounting; that is, income is recorded when earned instead of when received, and expenses are recorded when incurred instead of when paid. FTA does not allow the FFR to be prepared in the cash method of accounting. A grantee may keep its books on the cash basis during its accounting year; however, if this is the case, at the submission of the FFR, the grantee must prepare the necessary accruals and submit the FFR on the accrual basis of accounting. ⢠All Ïinancial facts (e.g., expenditures and obligations) relating to the scope and purpose of each Ïinancial report and applicable reporting period should be completely and clearly displayed in the FFR. ⢠Reported Ïinancial data should be accurate and up to date. The requirement for accuracy does not rule out inclusion of reasonable estimates when precise measurement is impractical, uneconomical, unnecessary, or conducive to delay. ⢠Financial reports should be based on the required supporting documentation maintained in the granteeâs ofÏicial Ïinancial management system. This system should produce information that objectively discloses Ïinancial aspects of events or transactions. ⢠Reported Ïinancial data should be derived from accounts that are maintained on a consistent, periodic basis; material changes in accounting policies or methods and their effect must be clearly explained. Module 2.5: FTA Financial Management LEVEL II - PAGE II-68
⢠Reporting terminology used in Ïinancial reports to FTA should be consistent with receipt and expense classiÏications included in the latest approved project. ⢠Federal cash on hand at the end of period (the amount of federal cash receipts not disbursed at the end of the reporting period) should reÏlect immediate cash needs. If there is cash on hand at the end of the reporting period, FTA requires an explanation describing why drawdowns were made early or other reasons for the excess cash, if any. FTA may assess interest charges for excess cash held for more than three business days. ⢠Both federal and local share of unliquidated obligations must be calculated with the correct federal/local share and reported. Unliquidated obligations are binding commitments that have been entered into and for which expenditures have not yet been recorded because goods and services have not been received. ⢠The rate of any indirect costs that are charged to a grant must be consistent with the cost allocation plan or indirect cost proposal (described later in this module). ⢠The state must certify in the remarks and certiÏication tab of the FFR in TEAM/TrAMS that the information submitted to FTA is true, complete, and accurate to the best of its knowledge. ⢠The state must respond to any FTA comments regarding an FFR. Instructions for completing the FFR screen in TEAM are provided in TEAM-Web User guide. FFR/MPR ReporÆ ng Due Dates ⢠For each open state S. 5309 grant that includes construction of a facility, the FFR and MPR are due quarterly, no later than 30 days after the end of each federal Ïiscal quarter (i.e., by January 30, April 30, July 30, and October 30). ⢠For all other open state grants, the FFR and MPR are due annually by October 31 for the preceding federal Ïiscal year (Oct. 1- Sept. 30). Module 2.5: FTA Financial Management LEVEL II - PAGE II-69
⢠Reports are due even when there is no grant activity. ⢠FTA may withhold payment for failure to submit either FFRs or MPRs in a timely manner. In individual cases, FTA may grant extensions of report due dates for good cause. Funds Management Funding Availability A grantâs funds are available for a Ïinite period. The following table shows the period of availability of funds for selected programs administered by states: Funding Program Period of Availability of Funds S. 5305 planning programs 4 years (Year of ApporÆ onment plus 3) S. 5307 small urbanized 6 years (Year of ApporÆ onment plus 5) S. 5309 fi xed guideway modernizaÆ on (State administered S. 5309 programs phasing out; FFY12 last year of apporÆ onment) 4 years (Year of ApporÆ onment plus 3) S. 5309 discreÆ onary (FFY12 last year of apporÆ onment; replaced by S. 5339 beginning FFY13) 3 years (Year of ApporÆ onment plus 2) S. 5310 3 years (Year of ApporÆ onment plus 2) S. 5311 3 years (Year of ApporÆ onment plus 2) S. 5316 (phasing out; FFY12 last year of apporÆ onment) 3 years (Year of ApporÆ onment plus 2) S. 5317 (phasing out; FFY12 last year of apporÆ onment) 3 years (Year of ApporÆ onment plus 2) S. 5339 4 years (Year of ApporÆ onment plus 3) Module 2.5: FTA Financial Management LEVEL II - PAGE II-70
Program funds remain available to the states for obligation for the number of federal Ïiscal years indicated. A state need not apply for all its funds the year the funds are apportioned, but states must obligate funds before the period of availability ends. Any funds remaining unobligated at the end of the period of availability are added to the next yearâs federal program apportionment and are reapportioned among all states (or UZAs in the case of S. 5307). Sometimes projects require less than the full amount of funds originally requested and obligated by the state, and therefore funds may remain after the project is completed. The state may reprogram remaining funds to other projects. Funds that a state deobligates from an approved POP remain available to the state for reobligation during the period that the funds were originally available to the state. Funds deobligated after the period of availability lapse to the state and return to FTA. FTA then reapportions these funds among all the states (or UZAs in the case of S. 5307). When developing a POP for a new Ïiscal year, the state should look to available funds in existing grants carried over from the last Ïiscal year, obligating the oldest funds Ïirst before applying for new funds. FTA prefers this practice as a strategy to minimize the length of time each grant is open and the number of open grants. Flexibility of Transfers among the State Managed Programs MAP-21 (and SAFETEA-LU) allows the states Ïlexibility in transferring funds among the various state-administered programs such as S. 5310 and S. 5311. In some cases, the purpose of the transfer provision is for administrative streamlining of grant making and is not intended to supplement other funding resources. Transfers must be done within the period of funding availability. Funds transferred must be used for the express purposes designated by the original program. Further, within an FTA program, states may have some Ïlexibility in transferring allocations between geographic areas or types of projects. For example, the post-MAP-21, S. 5310 program funds are to be allocated 60 percent among designated recipients in Although it may be surprising to hear that FTA funds are not always fully obligated at the state/local level, historically this has been an issue for some states, with money âleft on the tableâ that could be put to effective use in other states. This includes âCategory Câ projects under S. 5310 and S. 5311. To ensure that funds are used, FTA has become more proactive in requiring states to obligate funds within their period of availability. Module 2.5: FTA Financial Management LEVEL II - PAGE II-71
large urbanized areas; 20 percent to states for small urbanized areas; and 20 percent to the states for rural areas under 50,000 in population. Funds apportioned to small urbanized areas or rural areas may be transferred to projects in large urbanized areas if a stateâs governor certiÏies that objectives of the S. 5310 program are being met in the small urbanized or rural areas that received the initial apportionment. Alternatively, a state may transfer funds apportioned to small urbanized areas or rural areas for a project anywhere in the state, in accordance with an established statewide program for meeting the objectives of the S. 5310 program. However, S. 5310 funds apportioned to large urbanized areas may not be transferred to other areas. To: From: S. 5307 under 200K S. 5310 S. 5311 S. 5316 (phasing out) S. 5317 (phasing out) S. 5307 under 200K â Yes Yes No No S. 5310 No â No No No S. 5311 Yes No â No No S. 5316 (phasing out) Yes No Yes â No S. 5317 (phasing out) Yes No Yes No â S. 5339 Yes No Yes No No Payment Procedures Grantees request federal funds through U.S. DOTâs Electronic Clearinghouse Operation (ECHO-Web). The granteeâs records must support ECHO requests. The information should be traced back to an invoice for goods or services or timesheets, and be supported by information from the granteeâs accounting system. Either the individual who is the registered ECHO approving ofÏicial or a person to whom this person has delegated the authority in writing must approve each ECHO request. The approving ofÏicial must not draw the funds. Provisions in 49 CFR 18.21 and 19.22 and 31 CFR Part 205 govern payments to recipients for Ïinancing operations under federal grants and other programs. These regulations require that payment to a grantee be limited to the minimum amounts needed and Module 2.5: FTA Financial Management LEVEL II - PAGE II-72
timed so as to be in accord only with the actual, immediate cash requirements of the grantee in carrying out the approved project. Before a potential grantee requests funds, it should verify in TEAM that funds are available for the project. Funds should not be requested in amounts greater than the âAvailable Fundsâ reported in TEAM. The grantee may initiate draws only when cash is needed for immediate reimbursement and must disburse the funds within three business days. Disbursement means that the grantee no longer controls the money (e.g., a check has been sent to a vendor). In most cases, grantees request funds on a reimbursement basis (after expenses have been incurred and paid). In some cases (e.g., large bus procurements), grantees request funds prior to issuing a check. This procedure is acceptable as long as the funds are disbursed within three business days. More information on requesting and handling payments from FTA is found in Chapter VI of FTA C 5010.1D. ECHO is the primary automated application used by FTA grant recipients (grantees) to request payments from their grant awards. Grantees generate payment requests via message Good Grant Management Practices Examples of good grant management practices include: ⢠Spend oldest funds Ïirst for on-going expenses such as state/program administration, operating assistance, ADA complementary paratransit, and preventive maintenance. ⢠Accumulate state administrative expenses in a generic account and then draw from the oldest grant with available state administrative funds instead of charging the expenses directly to grants ⢠Tie third party contracts to projects, not directly to grants ⢠Set project time limits (less than 2 years) ⢠Use available funding in open grants before including projects in a new grant ⢠Move delayed projects to newer grants and active projects to older grants ⢠Transfer small remaining balances to new line items ⢠Deobligate project balances and reapply for funds (if within period of availability and allowed by the FTA regional ofÏice) ⢠Provide TEAM-Web/TrAMS access to both the stateâs program and accounting staff to facilitate the tracking of grant balances ⢠Regularly reconcile internal grant balances with those in TEAM-Web/TrAMS ⢠When funding a project with multiple grants, develop a grant drawdown plan ⢠When funding a project with multiple grants, charge retainage to the newest grant (and report it as an unliquidated obligation) to enable older grant closure Module 2.5: FTA Financial Management LEVEL II - PAGE II-73
submission within the ECHO-Web system. The FTA ECHO-Web User Manual provides detailed instructions on using ECHO-Web (http://www.fta.dot.gov/documents/ECHOWebGranteeUserManual.pdf). In addition, FTA circulars on each of its funding programs provide ECHO instructions in an appendix. Federal Financial Interest in Assets FTA retains a Ïinancial interest in the value of an FTA-funded capital asset (such as a vehicle or facility) until the asset has exceeded its useful life. The federal Ïinancial interest amounts to the federally-funded portion. For assets that depreciate (such as vehicles), the federal interest depreciates as well. For a $100,000 vehicle that was purchased with 80% federal funds that is currently valued at $10,000, FTA has a $8,000 federal interest. FTA provides a useful life policy for rolling stock, trolleys, ferries, facilities, and some equipment funded under S. 5307. FTA calculates the value of vehicles before the end of their minimum useful life on the basis of a formula using straight-line depreciation. Straight- line depreciation is a term most often used to indicate that personal property has declined in service potential. Real estate (land) generally does not depreciate. The Common Rule gives states Ïlexibility in managing and disposing of equipment. In keeping with the intent of the rule, FTA elects not to apply to S. 5310 and S. 5311 its policies regarding useful life standards for vehicles, vehicle replacement, or the requirement to use the straight line depreciation method for determining fair market value and FTA reimbursement. Instead, FTA holds states responsible for establishing and implementing their own rolling stock requirements for all categories of vehicles acquired under the S. 5310 program, consistent with the stateâs standards for equipment purchased with state funds. Removal of an FTA-funded vehicle from revenue service before the end of its minimum useful life, except for reasons of Ïire, collision, or natural disaster, leaves the recipient liable to FTA for the federal share of the vehicleâs remaining value. In the case of project equipment or supplies lost or damaged by Ïire, casualty, or natural disaster, the fair market value must be calculated on the basis of the condition of the equipment or supplies immediately before the Ïire, casualty, or natural disaster, irrespective of the extent of insurance coverage. FTA C 5010.1D provides more information on disposition requirements. Module 2.5: FTA Financial Management LEVEL II - PAGE II-74
TIPS ON RELATIONSHIPS TO OTHER MODULES This module is very closely related to FTA Grant Administration, Subrecipient Grant Administration, and Subrecipient Financial Management. LINKS/INFO ⢠FTA Circulars. http://www.fta.dot.gov/about/13716.html ⢠ECHO Web User Manual for FTA and FAA grantees. http://www.fta.dot.gov/documents/ECHO_Web_Grantee_User_Manual_ May_21_2012_version_2.4.pdf ⢠FTA ECHO Web User Manual 2012. http://www.fta.dot.gov/documents/ECHOWebGranteeUserManual.pdf ⢠FTA TEAM-Web User Guide. http://ftateamweb.fta.dot.gov/static/userguide.html Module 2.5: FTA Financial Management LEVEL II - PAGE II-75
1. How frequently must a state submit FFRs and MPRs on open grants? A) Quarterly B) Semi-annually C) Annually D) Only when there is Ïinancial or progress activity to report on the grant 1) A for all grants. 2) A for S. 5307 grants and C for all others. 3) A for S. 5309 grants that includes construction of a facility and C for all others. 4) D. 2. S. 5310 funds apportioned to small urbanized areas or rural areas may be transferred to projects in large urbanized areas if a stateâs governor certiÏies that objectives of the S. 5310 program are being met in the small urbanized or rural areas that received the initial apportionment. 1) True. 2) False. 3. What is the acronym for the electronic system that FTA uses to disburse funds? A) TEAM B) TrAM C) ECHO D) FUND 1) A, but transitioning to B. 2) C. 3) C, but transitioning to B. 4) D. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.5: FTA Financial Management LEVEL II - PAGE II-76
INTRODUCTION This module addresses the FTA requirements that subrecipients must comply with related to how grant funds are handled, accounted for, reported, and matched, as well as the stateâs role in oversight of this requirement area. Prior to reviewing this module, it is recommended that state staff review the following: FTA Grant Administration, Subrecipient Grant Administration, and FTA Financial Management. Financial management is closely related to grant administration, as illustrated to the right. The statutes and regulations governing Ïinancial management requirements include: ⢠Federal Transit Laws, Title 49, USC, Chapter 53 ⢠2 CFR Part 225 (OMB Circular A-87), âCost Principles for State, Local, and Indian Tribal Governmentsâ ⢠2 CFR Part 230 (OMB Circular A-122), âCost Principles for Non-ProÏit Organizationsâ ⢠31 CFR Part 205, âRules and Procedures for EfÏicient Federal-State Funds Transfersâ ⢠49 CFR Part 18, âUniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governmentsâ ⢠49 CFR Part 630, âUniform System of Accounts and Records Reporting Systemâ ⢠51 CFR 552, âFederal Agencies Responsible for Cost Negotiation and Audit of State and Local Governmentâ ⢠OfÏice of Management and Budget Open Government Directive - Federal Spending Transparency ⢠OMB Circular A-133, âAudits of States, Local Governments, and Non-ProÏit Organizationsâ ⢠P.L. 109-282 Federal Funding Accountability and Transparency Act of 2006 ⢠Single Audit Act Amendment of 1996 Module 2.6: Subrecipient Financial Management LEVEL II - PAGE II-77
IMPORTANCE FOR STATE DOT STAFF It is important that your subrecipients have the Ïinancial capacity to manage the federal (and state) transit grants that they are awarded by your agency. As the âgrantorâ, you are responsible for ensuring that your subrecipients are meeting all the federal regulations and managing their grants in an effective and compliant manner. A state may be cited as deÏicient in a State Management Review (SMR) if it does not comply with each FTA requirement. The state has oversight responsibility for subrecipients, and is responsible for reviewing subrecipient reimbursement requests and supporting documentation to ensure that only eligible expenses are being charged to the grant. DEFINITIONS Please refer to the deÏinitions in the FTA Financial Management module. KEY CONCEPTS ⢠Subrecipient Financial Capacity ⢠Eligible Expenditures ⢠Cost Allocation and Indirect Costs ⢠Local Match ⢠Force Account Activities ⢠Audit Requirements and Review Key guidance documents are: ⢠FTA Master Agreement ⢠FTA C 5010.1D - Grant Management Requirements ⢠FTA Grant program-speciÏic circulars Module 2.6: Subrecipient Financial Management LEVEL II - PAGE II-78
SUMMARY OF FTA REQUIREMENTS Subrecipient Financial Capacity Annually, the state certiÏies to FTA (as part of the annual certiÏications and assurance process) that it and its subrecipients have the Ïinancial capacity to carry out its proposed program of projects. This entails having adequate local funds to match the federal funds, since unless the minimum local match is provided for a grant project, the federal funds cannot be drawn down. Further, because FTA funding is provided on a reimbursement basis, subrecipients must have adequate cash Ïlow to keep the service operating, vehicles maintained, etc. while waiting for reimbursement from FTA through the state. To ensure that subrecipients have adequate Ïinancial capacity, the state must obtain and maintain sufÏicient documentation from each subrecipient to support the certiÏication to FTA. States have discretion in how this is accomplished, but generally require applicants to list the sources of funding that will be applied to the project. Some states have included the availability of local funding for the project as either a threshold criteria or evaluation criteria in the project selection process. Many states require the development of transit development plans. For capital items, such as vehicle purchases or facility construction, a state may request a three- to Ïive-year Ïinancial plan. Eligible Expenditures Eligible costs must speciÏically relate to the purpose of the grant contract and the latest approved project budget. Each FTA funding program has parameters on what expenses are eligible; the nature of the grant (capital, operating, etc.) will further limit what is considered eligible under that grant, and the project budget speciÏically deÏines what is considered eligible for FTA reimbursement. General Principles FTA grantees must follow the applicable cost principles circulars, currently in Title 2 of the Code of Federal Regulations, in determining whether project costs are allowable or unallowable. Title 2 CFR Part 225, also known as OMB Circular Aâ87, establishes principles and standards for determining costs applicable to grants, contracts, and other agreements with state and local governments Module 2.6: Subrecipient Financial Management LEVEL II - PAGE II-79
and federally recognized Indian tribes. Title 2 CFR Part 230, also known as OMB Circular Aâ122, establishes cost principles for nonproÏits. Criteria for allowable costs from 2 CFR part 225/OMB Circular Aâ87 are listed in FTA C 5010.1D, pages VI-5 to VI-7. Ineligible Expenses FTA funds may not be used for: ⢠Any project costs incurred by the grantee prior to the date of either the approved grant or the approved project budget (whichever is earlier), unless speciÏically provided for in a âLetter of No Prejudiceâ (or equivalent document approved by FTA), or in the pre-award authority as described in the Federal Register listing of the Annual Apportionments; and ⢠Any costs attributable to goods or services received under a contract or other arrangement that is required to be, but has not been, concurred or approved in writing by FTA. AccounÆ ng The Common Rule requires that the state and its subrecipients have Ïiscal control and accounting procedures sufÏicient to permit preparation of required reports, and permit the tracing of funds to a level of expenditures adequate to establish FTA funds have been spent on eligible expenses and not been used in violation of the restrictions and prohibitions of applicable statutes. States and subrecipients must be able to trace reimbursements to source documents. The state is responsible for ensuring that subrecipients have adequate Ïinancial management systems for expending and accounting for FTA funds properly, and can trace funds to a level of expenditures adequate to establish that such funds have not been used in violation of the restrictions and prohibitions of applicable statutes. Requests for Reimbursement Each state develops its own policies, procedures, and forms for subrecipients to follow to request grant reimbursement. In addition to Module 2.6: Subrecipient Financial Management LEVEL II - PAGE II-80
any state-speciÏic guidelines on how to review subrecipient reimbursement requests/invoices, state FTA program managers or their staff need to cross check what has been requested in the invoice against the supporting documentation provided (such as receipts, expense reports, operating data, etc.) to ensure that: ⢠All required forms and documentation have been submitted, are complete, and the Ïinancial calculations are correct. ⢠For operating projects, fares and other operating revenue are reported and deducted from the total expenses to determine operating deÏicit from which the local and federal matches are calculated. ⢠For projects with indirect costs, ensure that the cost allocation rate matches the approved rate (as described in the next section of this module). ⢠Only project-eligible expenses have been requested (and the subrecipient is not attempting to change the scope of the project, such as attempting to charge the purchase of a different capital item than was authorized in the grant agreement). ⢠The local match is provided in the format indicated in the grant agreement (and documented accordingly). ⢠The amount requested jives with the supporting documentation (receipts match expenses for capital purchases; performance measures derived from operating data look reasonable). ⢠The subrecipient has complied with the procurement requirements for the any purchase exceeding the stateâs threshold where requirements for documentation kick in. ⢠The amount requested is within budget, and sufÏicient funds remain to complete the project (e.g., operating funding requested will not exhaust the grant before the end of the time period funded under the grant). If documentation deÏiciencies, math errors, ineligible expenses, or issues are identiÏied in this review, the state should communicate with the subrecipient and ensure that the issues are resolved. Cost AllocaÆ on/Indirect Costs Under federally funded grant programs, recipients may incur both direct and indirect costs. Indirect costs are organizational costs which are not directly attributable to a speciÏic program or project. Such costs could include general administration services, utilities, communications technology, etc., that are shared by multiple departments or programs. Indirect costs are sometimes referred to as overhead costs, and they are typically allocated or charged to a program or project on a percentage basis. Module 2.6: Subrecipient Financial Management LEVEL II - PAGE II-81
An approved cost allocation plan is required to support the distribution of a subrecipientâs indirect costs to the FTA grant program. The cost allocation plan must be approved by FTA or the federal agency that provides the most funding to the subrecipient (referred to as the âcognizantâ federal agency). For subrecipients that are exclusively public or specialized transit providers, FTA may be the cognizant federal agency. However, the cognizant federal agency is likely to be another federal agency for other types of subrecipients, typically within the U.S. Department of Education for subrecipients that are local municipalities, and within the U.S. Department of Health and Human Services for subrecipients that are non-proÏit human service agencies. States are responsible for oversight of subrecipientsâ indirect cost allocation plans. This includes ensuring that the plan was submitted to a cognizant federal agency. Where a local government only receives funds as a subrecipient, the primary recipient is responsible for negotiating and/or monitoring the subrecipientâs plan. State monitoring of subrecipients should include ensuring that the indirect cost allocation plan is retained for audit, and, when reviewing both a subrecipientâs grant application budget and its requests for reimbursement, that indirect costs are charged at the current rate and against the correct base. Details on the requirements for the cost allocation plan are provided in FTA C 5010.1D, Chapter VI. Local Match States and their subrecipients must provide sufÏicient funds or approved in-kind resources to serve as local match for all FTA-assisted projects. When submitting its grant application to FTA, the grantee certiÏies that it has or will have available the proportionate amount of local share promptly as project costs are incurred or become due, except to the extent that the federal government determines in writing that the local share may be deferred. The grantee may not use an amount as match for more than one grant. State assistance may provide some or the entire non-federal match. The sources of state funding may differ for capital and operating assistance programs. Operating assistance may be funded through general revenues. Capital assistance may be funded through bond revenues. FTA does not require a dedicated funding source. Module 2.6: Subrecipient Financial Management LEVEL II - PAGE II-82
All of the local share must come from non-U.S. DOT sources, except for Federal Lands Highway Program funds. FTA permits the use of the following as local share: cash (or in-kind contribution); non-farebox revenues from transit operations (e.g., advertising and concession revenues); amounts received under a service contract with a state, local, or private social service agency or organization; undistributed cash surpluses; replacement or depreciation cash funds; reserves available in cash or new capital; in- kind contributions; revenue bond proceeds (capital only); transportation development (toll) credits; program income generated from an earlier grant; Temporary Assistance for Needy Families (TANF) funds; and other non-DOT federal funds, such as Community Development Block Grant funds, if authorized by the originating program to be used for transportation. Under S. 5307, in-kind contributions such as the market value of in-kind contributions integral to the project may be counted as a contribution toward local share. Grantees may use in-kind contributions of real property as part of the local matching share so long as the property to be donated is needed to carry out the scope of the approved project, with additional caveats as detailed on the FTA circular for this program. Under S. 5310 and S. 5311, non-cash share such as donations, volunteered services, or in-kind contributions can be counted toward the local match as long as the value of each is documented and supported, represents a capital cost which would otherwise be eligible under the program, and is included in the net project costs in the project budget. The state must ensure each subrecipient has or will have the required local match for the project and has or will have sufÏicient funds to operate and maintain the vehicles and equipment purchased under the project. Revenue sources should be stable and reliable enough to meet future annual operating and routine capital costs. The state must obtain and maintain sufÏicient documentation from each subrecipient to support its certiÏication to FTA. The state must ensure that subrecipients use only eligible funds as local match and that volunteer or in-kind services are fully documented. States generally require applicants to list the sources of funding that will be applied to the project. Some states have included the availability of local funding for the project as a threshold or evaluation criterion in the project selection process. Many states require the development of transit development plans. For capital items, such as vehicle purchases or facility construction, a state may request a three to Ïive year Ïinancial plan. Income received from the authorized incidental or joint development uses of FTA-funded assets may be retained by the grantees Module 2.6: Subrecipient Financial Management LEVEL II - PAGE II-83
(without returning the federal share) if the income is used for eligible transit capital and operating expenses. This income cannot be used as part of the local share of the grant from which it was derived. However, it may be used as part of the local share of another FTA grant. Force Account AcÆ viÆ es When a subrecipient uses its own work force to carry out a capital grant project, rather than using contractors (e.g. public works staff installing bus shelters), this is referred to by FTA as âforce accountâ work. Force account work includes design, construction, refurbishment, inspection, and construction management activities. It does not include grant or project administration that is otherwise a direct project cost. As noted in FTA C 5010.1D, force account also does not include preventive maintenance or other items under the expanded deÏinition of capital (i.e. security drills, mobility management) that are traditionally not capital projects. Subrecipients that use their own workforce on a capital project, with the force account work costing $100,000 or more, must have a force account plan and justiÏication. Force account work may be justiÏied based on: 1. cost savings, 2. exclusive expertise, 3. safety and efÏiciency of operations, or 4. a union agreement. The state must ensure that each subrecipient that has force account work of $100,000 or more has a force account plan and justiÏication on Ïile. Details regarding force account plan and justiÏication requirements, and what a grantee must submit to be eligible for FTA reimbursement for force account work, are found in FTA C 5010.1D pages IV-35 to IV-36. In the unusual situation where a subrecipient plans to use force account valued $10,000,000 or more, the subrecipientâs force account plan and justiÏication must be submitted to the FTA for prior approval. When work to be performed using force account is valued less than $100,000, no plan is required. Module 2.6: Subrecipient Financial Management LEVEL II - PAGE II-84
Audit Requirements and Review Non-federal entities that expend $500,000 or more in a year in federal awards must have a single or program-speciÏic audit conducted for that year in accordance with the provisions of OMB Circular A-I33, âAudits of States, Local Governments, and Non-ProÏit Organizations,â downloadable through http://www.whitehouse.gov/omb/circulars_default. The state must ensure that subrecipients that meet this threshold comply with this requirement. Items purchased by the state for a subrecipient count towards a subrecipientâs single audit threshold. However, FTA does not require a single audit of a subrecipient when assistance is provided solely in the form of capital equipment procured directly by the state. The complete audit package, along with the management letter and a copy of the SF-SAC form, are due to the Federal Audit Clearinghouse within the earlier of 30 days after receipt of the auditorâs report(s), or nine months after the end of the audit period. Auditors may use the online submission option. The website is located at http://harvester.census.gov/sac/. The state should review the audit reports of its subrecipients, particularly any Ïindings related to FTA grants. The state must ensure that subrecipients resolve audit Ïindings related to FTA programs within six months of receipt of the audit report. TIPS ON RELATIONSHIPS TO OTHER MODULES This module is very closely related to FTA Grant Administration, Subrecipient Grant Administration, and FTA Financial Management. LINKS/INFO ⢠FTA Grant Circulars. http://www.fta.dot.gov/about/13716.html ⢠OMB Circular A-I33, âAudits of States, Local Governments, and Non-ProÏit Organizations.â http://www.whitehouse.gov/omb/ circulars_default. Module 2.6: Subrecipient Financial Management LEVEL II - PAGE II-85
⢠Federal Audit Clearinghouse. http://harvester.census.gov/sac/ QUIZ 1. A âLetter of No Prejudiceâ can authorize a grantee to incur project costs prior to the approved grant. 1) True. 2) False. 2. Under which program(s) can volunteered services be counted as local match? A) S. 5310 B) S. 5311 C) S. 5307 1) A. 2) B. 3) A & B. 4) C 3. FTA is almost always the cognizant federal agency for the purpose of approval of S. 5310 and S. 5311 subrecipientsâ cost allocation plans. 1) True. 2) False. Module 2.6: Subrecipient Financial Management LEVEL II - PAGE II-86
4. A subrecipient is using force account work for a capital grant project with estimated labor costs of $8,000 and estimated total project costs of $12,000. In this case, the state: A) Must have a force account plan and justiÏication approved by the FTA. B) Must only have a force account plan. C) Does not need a plan or justiÏication. 1) A. 2) B. 3) C. 5. A subrecipient is using multiple grants to Ïinance a capital project; a force account plan is needed. 1) True. 2) False. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.6: Subrecipient Financial Management LEVEL II - PAGE II-87
KEY CONCEPTS ⢠FTA Compliance Reviews of States ⢠State Reviews of Subrecipient Compliance ⢠Project Management of Facility Construction or Rehabilitation Projects INTRODUCTION This module addresses general requirements and responsibility related to oversight of FTA recipients and subrecipients, as well as the stateâs responsibility for technical oversight of subrecipient capital projects (covered in the State Management Review workbook in the âProject Managementâ section). FTA oversees program management activities conducted by state DOTs through several kinds of in-depth reviews. States are responsible for ensuring that their subrecipients comply with FTA requirements associated with each grant or project. FTA requires grantees (including states) to maintain satisfactory continuing control of federally-funded real property, facilities, and equipment, and to ensure that they are used in transit service. In addition to requiring subrecipents to sign and submit annual certiÏications and assurances, states also need to monitor subrecipients and how they are using their FTA grant funds and FTA-funded equipment and facilities to ensure that the funds are being used as intended. Further, they need to enforce any requirements in which a subrecipient is found to be deÏicient. State DOTs must ensure the continuous management of FTA funded projects. Procedures must be in place for quality control and technical supervision. IMPORTANCE FOR STATE DOT STAFF State DOTs are responsible for oversight of their subecipientsâ compliance with FTA requirements. State transit staff needs to maintain documentation of its grant program activities as well as its oversight of subrecipients. State DOTs generally accomplish this function by conducting both on-going and periodic compliance reviews of their grantees to ensure compliance with federal and state regulations as well as continuing control of federally-funded assets. One aspect of oversight that is important but often overlooked is the need to follow-up on areas of non-compliance with subrecipients and to document their corrective actions. Module 2.7: Project Management and Grantee Oversight LEVEL II - PAGE II-88
State DOTs must ensure the continuous management of FTA funded projects, whether the projects are conducted by the state or by its subrecipients. Management of capital projects requires technical knowledge. DEFINITIONS Capital Project: in general, projects that involve purchasing, leasing, constructing, maintaining, or repairing facilities, rolling stock and equipment intended for use in a public transportation system. Capital project costs may include all direct costs and indirect costs associated with the project. Eligible expenses for capital projects vary by grant program. The deÏinition of capital project in MAP-21 is two pages long and includes the following categories: (A) acquiring, constructing, supervising, or inspecting equipment or a facility for use in public transportation, expenses incidental to the acquisition or construction (including designing, engineering, location surveying, mapping, and acquiring rights-of- way), payments for the capital portions of rail trackage rights agreements, transit-related intelligent transportation systems, relocation assistance, acquiring replacement housing sites, and acquiring, constructing, relocating, and rehabilitating replacement housing; (B) rehabilitating a bus; (C) remanufacturing a bus; (D) overhauling rail rolling stock; (E) preventive maintenance; (F) leasing equipment or a facility for use in public transportation when more cost-effective than purchase or construction; (G) a joint development improvement (details omitted here); (H) the introduction of new technology, through innovative and improved products, into public transportation; (I) the provision of ADA paratransit transportation services, but only for grant recipients that are in compliance with applicable ADA requirements, including both Ïixed route and demand responsive service, and only for amounts not to exceed 10 percent of such recipientâs annual formula apportionment under sections 5307 and 5311; (J) establishing a debt service reserve, made up of deposits with a bondholderâs trustee, to ensure the timely payment of principal and interest on bonds issued by a grant recipient to Ïinance an eligible project; Module 2.7: Project Management and Grantee Oversight LEVEL II - PAGE II-89
(K) mobility management consisting of short-range planning and management activities and projects for improving coordination among public transportation and other transportation service providers (excluding operating public transportation services); or (L) associated capital maintenance (details omitted here). Federal Interest: the federally-funded portion of an assetâs value. For an asset that was purchased using 80% FTA funding and 20% local match funding, the federal interest would be 80% of the current fair market value of the asset (factoring in depreciation). Project Management Plan: a document that deÏines all the tasks necessary to implement a major capital project, including strategies to control the project scope, budget, schedule, and quality (49 CFR 633). Useful Life: the expected lifetime of project property, or the acceptable period of use in service. Useful life of revenue rolling stock begins on the date the vehicle is placed in revenue service and continues until it is removed from service. DETAILS ON FTA REQUIREMENTS FTA Compliance Reviews of States FTA oversees program management activities conducted by state DOTs through several kinds of in-depth reviews. When conducting oversight reviews of states, FTA looks at how the state conducts oversight of its subrecipients to determine whether the state oversight is adequate to ensure compliance with FTA requirements at the local level. State Management Reviews FTAâs OfÏice of Program Oversight conducts periodic (generally every three years) State Management Reviews (SMRs) of each state DOT to ensure that the state is carrying out its obligations as a primary grantee of FTA funding. [It should be noted that, during the time this curriculum was being drafted, the researchers learned that FTA was planning a reorganization of oversight functions. The Module 2.7: Project Management and Grantee Oversight LEVEL II - PAGE II-90
OfÏice of Oversight and Program Guidance will be divided. Program Guidance will join the Grants Management ofÏice, while Program Oversight will become part of a new parent OfÏice of Safety & Oversight.] The SMR is a comprehensive assessment of the stateâs compliance with FTA requirements in implementation and management of FTA programs. The SMR process includes a: ⢠Desk Review - documentation on Ïile with FTA is reviewed prior to visiting the state on site. ⢠Site Review - FTAâs reviewers spend several days in the ofÏices of the state DOT, interviewing key staff members and inspecting Ïiles. The reviewer uses a workbook of detailed questions addressing each compliance area. ⢠Compliance Report - The reviewersâ Ïindings are documented in a report which details any areas where the state was found to be out of compliance. ⢠Follow-Up Actions - The state is required to take corrective action in a speciÏied time frame to come into compliance in any area where deÏiciencies where found by the reviewer. ⢠Follow-Up Review - FTA follows up with the state to ensure that the corrective actions were completed as assigned so that the state achieves compliance. Other FTA Oversight of States In addition to the comprehensive SMR, FTA conducts oversight reviews in speciÏic areas as warranted for states that are at-risk or out of compliance. These include: ⢠Civil Rights Review - conducted by FTAâs OfÏice of Civil Rights, these reviews assess compliance with Title VI of the Civil Rights Act of 1964, (including aspects of Environmental Justice), Equal Employment Opportunity (EEO), Disadvantaged Business Enterprise (DBE) programs, and the Americans with Disabilities Act of 1990 (ADA). ⢠Financial Management Review - A state may be subject to a Full Scope Financial Management System Review, a Follow-up Review (which according to the FTA website typically occurs 12-18 months after a Full Scope review), and other reviews of special focus. Module 2.7: Project Management and Grantee Oversight LEVEL II - PAGE II-91
⢠Procurement System Review - Procurement system reviews focus on the stateâs compliance with federal procurement requirements as detailed in FTA Circular 4220.1F - Third Party Contracting Guidance. State DOTs that operate urban transit systems funded with S. 5307 or 5309, or have oversight of small urbanized transit systems funded under these programs, are also subject to FTAâs Triennial Reviews, ADA Compliance Reviews, and other FTA reviews that are relevant to transit system management and operations. State Reviews of Subrecipient Compliance States are responsible for ensuring that their subrecipients comply with FTA requirements associated with each grant or project. FTA requires grantees (including states) to maintain satisfactory continuing control of federally-funded real property, facilities, and equipment, and to ensure that they are used in transit service. In addition to requiring subrecipents to sign and submit annual certiÏications and assurances, states also need to monitor subrecipients and how they are using their FTA grant funds and FTA-funded equipment and facilities to ensure that the funds are being used as intended. Further, they need to enforce any requirements in which a subrecipient is found to be deÏicient. Beyond the FTA-required annual certiÏications and assurances, each state determines the oversight activities it conducts on its subrecipients. This can range from informal observation and review to in-depth audits of compliance with federal (and state) requirements. Common monitoring approaches include: ⢠Review of detailed information and documentation required as part of the grant application process. ⢠Review of required operating and Ïinancial reports and back-up documentation. Many states require monthly or quarterly reports from subrecipients. ⢠Review of performance measures. ⢠Review of written subrecipient policies, procedures, plans, and programs. ⢠Requiring procurement documentation for FTA-funded purchases. ⢠Periodic site visitsâstate staff can use any visit to a subrecipient to scout out potential problems and gain a better understanding of the services and organizational structure of the local grantee. Module 2.7: Project Management and Grantee Oversight LEVEL II - PAGE II-92
⢠Inspection of facilities. ⢠Vehicle inspections. ⢠Completion of compliance checklists (comprehensive or targeted). ⢠Review of grant Ïiles for required documentation (both on-site and those maintained by the state) ⢠Review of subrecipientsâ online information and marketing materials. ⢠Review of subrecipientsâ annual audits. Analogous to the specialized reviews conducted by FTA on the states, states can in turn conduct specialized reviews of subrecipients, such as drug and alcohol program reviews, maintenance audits, etc. Oversight can be seen as an opportunity to educate and provide technical assistance to subrecipients, rather than simply policing their actions. States can develop the technical capacity of their subrecipients (and build positive state-to-subrecipient relationships) by providing training on requirements, encouraging subrecipients to ask questions, and offering hands-on assistance with achieving compliance. For capital projects used to purchase assets, state oversight of subrecipient use of the asset should continue until FTA no longer has a Ïinancial interest in the asset (i.e., until the asset exceeds its useful life in terms of years or, for vehicles, mileage). Capital Project Management and Oversight State DOTs must ensure the continuous management of FTA funded projects, whether the projects are conducted by the state or by its subrecipients. Management of capital projects requires technical knowledge. In conducting SMRs, FTA reviews the stateâs technical oversight of capital projects in the context of project management. Capital projects are deÏined by their scope, budget, and schedules; effective project management involves executing these elements while maintaining acceptable levels of risk, quality, safety, and security. Module 2.7: Project Management and Grantee Oversight LEVEL II - PAGE II-93
Project Management of State-Level Facility ConstrucÆ on and RehabilitaÆ on In many cases, state DOTs contract out for facility construction or facility rehabilitation projects. They must provide technical oversight of the contractor, including regular meetings to review the project status. State project management and oversight may be done in house or by an outside architectural/engineering Ïirm. States contracting directly for facility construction or rehabilitation must provide technical oversight of the project. Regular meetings between the project manager and contractor(s) should be held to review project status. States may use internal staff, such as an engineering or construction group, to oversee construction projects. States that do not have the technical expertise or internal resources to manage large projects may hire an architectural/engineering (A&E) consultant to serve as project manager. As described in detail in FTAâs Construction Project Management Handbook (see Links/Info for more), the typical project life cycle includes design, bid, and build phases. Even before projects enter the design phase, preliminary considerations include site selection and other zoning issues, public participation, as well as technical studies on water, air, soil, trafÏic, etc. Project alternatives could include construction versus renovation, leasing, and/or shared arrangements with other agencies. Under 49 USC 5327, recipients are required to prepare a project management plan (PMP) for all FTA funded major capital projects. However, major capital projects primarily deal with the construction and/or rehabilitation of Ïixed guideways, rather than facilities. Facility construction/ rehabilitation projects are not deÏined as major and generally do not require formal PMPs, though some states prepare these plans regardless. PMPs document project organization, management, budget/costs, planning, design, construction, closeout, quality and risk management, procurement, and communications. Even when not required, some states have project management plans. Project Oversight of Subrecipient Facility Projects The state is also responsible for monitoring the facility projects of subrecipients. Monitoring mechanisms may include: Module 2.7: Project Management and Grantee Oversight LEVEL II - PAGE II-94
⢠Contracting a consultant to provide project management oversight. ⢠Reviewing the request for proposals and construction contracts. ⢠Reviewing architectural plans and drawings. ⢠Conducting periodic site inspections. ⢠Requiring special progress reports. ⢠Conducting regular project management meetings. ⢠Withholding payment of a portion of the grant until Ïinal inspection and acceptance. Project Oversight of Procurements States buying revenue rolling stock directly must provide for technical oversight of the procurement. When subrecipients buy buses directly, the state must monitor the procurement. States must provide technical oversight of technology projects implemented by it or its subrecipients. A stateâs information technology (IT) department may oversee technology projects, sometimes with consultant support. For procurements for the state-managed programs, the state should document its procedures for administering construction projects, bus procurements, and other capital projects in the state management plans. More information of oversight in procurements is found in the following modules: ⢠Introduction to Procurement ⢠Procurement Policies, Process, and History ⢠Disadvantaged Business Enterprise (DBE) ⢠Buy America and Vehicle Procurement Requirements Module 2.7: Project Management and Grantee Oversight LEVEL II - PAGE II-95
SUPPLEMENTAL NOTES Compliance Monitoring Tools for Subrecipient Oversight An electronic library of monitoring tools is available to assist state transit programs in developing their own monitoring tools for subrecipients. Developed in 2009 and based on the FTA State Management Review Workbook in use at the time, this toolkit was published as National Cooperative Highway Research Program (NCHRP) Research Results Digest 341: Compliance Monitoring Tools. This toolkit may be downloaded or ordered from the Transportation Research Board through http://www.trb.org/Main/ Blurbs/163185.aspx. NEPA Requirements for Capital Projects Capital projects are subject additional requirements under the National Environmental Policy Act (NEPA). The NEPA process ensures that the environmental effects of proposed transit projects are documented and accounted for, and that alternatives are considered to avoid, minimize, or mitigate adverse effects. Based on the degree of adverse environmental impact the FTA determines one of the following classes of action for a project: ⢠Categorical Exclusion (CE) ⢠Environmental Assessment (EA) ⢠Environmental Impact Statement (EIS) Categorical Exclusions are for projects that are projected to have minimal to no adverse impacts; no NEPA-related actions are necessary. Depending on the location, bus transfer, storage, and maintenance facilities are typically designated as CEs. However, in cases where the impacts or actions are not known, an Environmental Assessment is required. This includes an alternatives analysis, and may or may not result in a âÏinding of no signiÏicant impactâ or FONSI. The last class of action, an Environmental Impact Statement, is a very involved process that is necessary when impacts are signiÏicant. In addition to NEPA, recipients must also comply with state environmental requirements; the environmental compliance process varies signiÏicantly from one state to another. See 23 CFR 771 for additional details. Module 2.7: Project Management and Grantee Oversight LEVEL II - PAGE II-96
TIPS ON RELATIONSHIPS TO OTHER MODULES ⢠Topic-speciÏic oversight of subrecipients is discussed in many of the modules. ⢠Force account requirements (which FTA includes in the Project Management section of the SMR workbook) are addressed in the Subrecipient Financial Management module. LINKS/INFO ⢠FTA Circular 5010.D, âGrant Management Requirements.â http://www.fta.dot.gov/legislation_law/12349.html. ⢠FTA Construction Project Management Handbook. September 2009. http://www.fta.dot.gov/documents/FTA-CONSTRUCTION-PRJT-MGMT-HDBK2009.pdf. ⢠FTA Project Management Oversight Guidance webpage. http://www.fta.dot.gov/grants/13923.html ⢠FTA Oversight web page. http://www.fta.dot.gov/about/12310.html ⢠NCHRP Research Results Digest 341: Compliance Monitoring Tools - http://www.trb.org/Main/Blurbs/163185.aspx Module 2.7: Project Management and Grantee Oversight LEVEL II - PAGE II-97
QUIZ 1. Under NEPA, capital projects that are projected to have minimal to no adverse impact require an Environmental Assessment (EA). 1) True. 2) False. 2. The SMR process includes all of the following except: A. A desk review B. A site review C. A procurement system review D. A follow-up review 1) A. 2) B. 3) C. 4) D. 3. Projects dealing with the construction or rehabilitation of Ïixed guideways are not deÏined as major capital projects and therefore do not require formal project management plans. 1) True. 2) False. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.7: Project Management and Grantee Oversight LEVEL II - PAGE II-98
INTRODUCTION FTA grantees (and subrecipients) use their own procurement procedures that reÏlect applicable state and local laws and regulations, provided that the process ensures competitive procurement and the procedures conform to applicable federal law, including 49 CFR Part 18 (speciÏically Section 18.36) and FTA Circular 4220.1F, âThird Party Contracting Guidance.â This module provides an introduction to the major elements of the FTA procurement requirements as they apply to states. More details are provided in the subsequent modules of this section: ⢠Procurement Policies, Process, and History ⢠Disadvantaged Business Enterprise (DBE) ⢠Buy America and Vehicle Procurement Requirements The complexity of the full requirements is reÏlected in the fact that FTA circular 4220.1F is approximately 150 pages long, and NTI presents a series of multi-day courses that address the details of the requirements. This curriculum attempts to distill the requirements into a brief introduction. State transit staff with procurement oversight responsibilities are advised at a minimum to read the full FTA circular 4220.1F. Ideally they should also attend an introductory NTI procurement course, âProcurement Series - I - Orientation to Transit Procurementâ (3.5 days) or âProcurement for Small and Medium Transit Systemsâ (2 days). The statutes and regulations governing transit procurement include: ⢠Federal Transit Laws, Title 49, USC, Chapter 53; also public transportation provisions of Title 23, USC ⢠49 CFR Part 18 § 18.36 Procurement ⢠FTA Master Agreement Numerous other statutes and regulations govern speciÏic aspects of procurements. These are detailed within FTA C 4220.1F - âThird Party Contracting Guidance.â Module 2.8: Introduction to Procurement LEVEL II - PAGE II-99
KEY CONCEPTS FTA procurement requirements are complex and designed to achieve numerous goals including: ⢠Ensuring consistent and fair approaches to procurement by following written policies and procedures and a code of standards of conduct. ⢠Ensuring cost-efÏicient purchases (requiring an independent cost estimate when planning the purchase, and a cost or price analysis for each purchase). ⢠Ensuring full and open competition among potential vendors by requiring formal procedures for soliciting and reviewing bids and proposal, prohibiting geographic preferences, and providing for a complaint process. ⢠Creating a âlevel playing Ïieldâ on which businesses owned by minorities and women can compete fairly for FTA-funded contracts (Disadvantaged Business Enterprise or DBE requirements). ⢠Ensuring that vendors are fully qualiÏied to deliver what is being purchased, and have not been banned from participating in federally-funded contracts (suspension and debarment). ⢠Ensuring that steel, iron, and manufactured products used in FTA funded projects are produced in the United States (Buy America requirements). ⢠Ensuring that revenue rolling stock (i.e., vehicles) purchased not only meet Buy America provisions, but also Federal Motor Vehicle Safety Standards, FTA bus testing requirements, and other requirements designated by the purchaser (i.e., the grantee or subrecipient) (requiring pre-award and post-delivery audits). ⢠Ensuring that all FTA-funded contracts include clauses that address all applicable FTA requirements. ⢠Maintaining a detailed paper trail that provides documentation of all steps in the process. Module 2.8: Introduction to Procurement LEVEL II - PAGE II-100
IMPORTANCE FOR STATE DOT STAFF States are responsible for establishing and following their own federally-compliant procurement policies and procedures for making their own purchases (or purchases on behalf of subrecipients), as well as for verifying that subrecipients do this as well. FTA reserves the right to decline to participate in (i.e., deny funding for) the costs of third party procurements that fail to comply with federal laws, regulations, or the terms of the recipientâs underlying grant or cooperative agreement. DEFINITIONS Common Grant Rule: U.S. DOT regulations that apply to all federal grants and cooperative agreements with governmental, non- governmental, and Indian tribal government recipients (49 CFR Parts 18 and 19, âUniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governmentsâ and âUniform Administrative Requirements for Grants and Agreements with Institutions of Higher Education, Hospitals, and Other Non-ProÏit Organizationsâ). Contract: a mutually binding legal relationship obligating the seller to furnish the supplies or services (including construction) and the buyer to pay for them. It includes all types of commitments that obligate the recipient to expenditure and that, except as otherwise authorized, are in writing. In addition to bilateral instruments, contracts include (but are not limited to) awards and notices of awards; job orders or task letters issued under basic ordering agreements; letter contracts; orders, such as purchase orders, under which the contract becomes effective by written acceptance or performance; and bilateral contract modiÏications. Contracts do not include grants and cooperative agreements. Joint Procurement: (sometimes informally referred to as âcooperative procurementâ) a method of contracting in which two or more purchasers agree from the outset to use a single solicitation document and enter into a single contract with a vendor for delivery of property or services in a Ïixed quantity, even if expressed as a total minimum and total maximum. Unlike a state or local government Procurement refers to purchasing items or services. Another expression that is frequently used in FTA regulations and guidance is âthird party contracting.â This refers to the relationship between FTA, the funding recipient, and the party from which the funding recipient is buying something, also known as the contractor or vendor. Module 2.8: Introduction to Procurement LEVEL II - PAGE II-101
purchasing schedule or contract, a joint procurement is not drafted for the purpose of accommodating the needs of other parties that may later choose to participate in the beneÏits of that contract. Recipient: the public or private entity to which FTA awards federal assistance through a grant, cooperative agreement, or other agreement. The recipient is the entire legal entity even if only a particular component of the entity is designated in the document through which FTA has awarded the federal assistance. The term ârecipientâ includes âgrantee,â which is a ârecipientâ of federal grant assistance. The term ârecipientâ also includes each member of a consortium, joint venture, team, or partnership awarded FTA assistance through a grant, cooperative agreement, or other agreement. For the purposes of the FTA procurement requirements, ârecipientâ also includes any subrecipient or subgrantee of the recipient. SUMMARY OF FTA REQUIREMENTS There are two distinct perspectives of applicability of procurement requirements that state transit program staff should be aware of: the state as the purchaser, and state as the oversight agency for its subrecipients. State as Purchaser States may procure such diverse projects for their subrecipients as vehicles, technology, real estate, construction, planning and engineering studies, vehicle maintenance, training, and statewide transit marketing. States purchase for their own use the supplies, equipment, and facilities used by state staff in the day-to-day administration of FTA grants. Further, states that operate their own transit services, such as commuter bus or rail, ferry, or regional mass transit systems, must purchase everything needed to manage and operate these services. States establish their own policies and procedures, typically spelled out in state code, which must be followed whenever the state is the purchaser. When procuring property and services under a grant, a state will follow the same policies and procedures it uses for procurements from its non-federal funds [49 CFR Part 18, § 18.36 (a)]. At a minimum, the state must comply with the federally mandated requirements on contract term limitations for revenue vehicle purchases, competition, prohibitions against geographic preferences, Module 2.8: Introduction to Procurement LEVEL II - PAGE II-102
procurement of architectural engineering (A&E) services, and awards to responsible contractors. The state must also ensure that each purchase order and contract Ïinanced with FTA assistance includes all provisions required by federal statutes and their implementing regulations, and that each third party contractor and subcontractor is required to comply with the terms of its third party contract or subcontract. In this regard, the state has oversight responsibilities of its contractors and subcontractorsâin addition to its subrecipients. State Oversight of Subrecipients The stateâs subrecipients are subject to the requirements outlined in FTA Circular 4220.1F when making purchases using FTA funding, and the state is responsible for ensuring that subrecipients are aware of and comply with applicable FTA procurement requirements. The procurement requirements in this curriculum generally focus on the state as the oversight agency of the subrecipients, rather than the stateâs obligations in conducting its own procurement activities or in conducting oversight of its own contractors. An exception to this is the DBE goal-setting and reporting requirements, because subrecipient goals and activities should be incorporated in the stateâs overall goal and reports submitted to FTA. Also, since many states procure vehicles on behalf of their subrecipients (particularly small vehicles used in demand-response service under the S. 5310 program, for example), the requirements described in the Buy America and Vehicle Requirements module apply to state procurements as well as subrecipients. Oversight of Subrecipient Compliance In addition to complying with state and local law, subrecipients must comply with relevant FTA third party contracting requirements when procuring goods and services with FTA assistance. ⢠Subrecipients that are public entities must comply with FTA requirements that apply to states (those provisions of FTA C 4220.1F and the sections of the Common Grant Rule for governmental recipients, as regulated in 49 CFR Part 18). ⢠Subrecipients that are private non-proÏit or for-proÏit entities must comply with all the FTA requirements of FTA C 4220.1F (per 49 CFR Part 19). Module 2.8: Introduction to Procurement LEVEL II - PAGE II-103
The state is responsible for ensuring that these organizations are aware of and comply with the requirements for procurements funded with FTA funds. FTA considers all metropolitan planning organizations (MPOs), even those incorporated as a nonproÏit organization under state law, to be âlocal governments.â Additionally, each subrecipientâs third party contractor and subcontractor is required to comply with the terms of its third party contract or subcontract, including requirements to extend those federally required clauses and provisions to its subcontractors at the lowest tier required. States must ensure that subrecipients are monitoring compliance of their contractors. Public EnÆ Æ es Procurement requirements that apply to the state, public entity subrecipients, and contractors are: ⢠Comply with its own procurement regulations. ⢠Conduct all procurements in a manner providing full and open competition. ⢠Exclude the use of statutorily or administratively imposed in-state or local geographical preferences in the evaluation of bids or proposals except in those cases where applicable federal statutes expressly mandate or encourage geographic preference. ⢠Use competitive proposal procedures based on the Brooks Act when contracting for architectural and engineering services, if the state has not adopted a statute governing the procurement of such services before August 10, 2005. ⢠Award to only responsible contractors possessing the ability, willingness, and integrity to perform successfully under the terms and conditions of the contract. ⢠Ensure that every purchase order and contract executed using federal funds includes all clauses required by federal statutes and executive orders and their implementing regulations. ⢠Do not enter into any contract for rolling stock with a period of performance for ordering exceeding Ïive years, inclusive of options, without prior FTA approval. ⢠Comply with Buy America requirements, including pre-award and post-delivery requirements. ⢠Comply with debarment and suspension requirements. Module 2.8: Introduction to Procurement LEVEL II - PAGE II-104
⢠Comply with lobbying requirements. ⢠Comply with piggybacking requirements. Private EnÆ Æ es In addition to the requirements that apply to public entities, FTA C 4220.1F requirements that apply to private nonproÏit or for-proÏit entities include, but are not limited to, the following: ⢠Maintain a written code of standards of conduct governing the performance of employees engaged in the award and administration of contracts. ⢠Have written procurement policies and procedures. ⢠Have written protest procedures to handle and resolve disputes relating to the award of contracts. ⢠Have procedures for settlement of contract issues/disputes (procurements >$100,000) ⢠Analyze each planned acquisition in order to identify and evaluate potential organizational conÏlicts of interest. ⢠Review procurement requests to avoid duplicative or unnecessary purchases. ⢠Incorporate a clear and accurate description of the material, product, or services being procured; identify all requirements that offerors must fulÏill; and identify evaluation factors in solicitations. ⢠Develop an independent cost estimate before receiving bids or proposals. ⢠Conduct a contract cost or price analysis for every procurement. ⢠Evaluate options at the time of bid award, exercise the options at the agreed upon terms, and determine that the option price is better than current market prices before exercising the options. ⢠Maintain a contract administration system that ensures that contractors perform in accordance with the terms, conditions and speciÏications of their contracts or purchase orders. ⢠Maintain a written record of procurement history. FTA C 4220.1F contains a complete list of third party contracting requirements. Module 2.8: Introduction to Procurement LEVEL II - PAGE II-105
FTA Guidelines for Monitoring Subrecipient Compliance (Source: 2013 SMR Workbook, pages 5-12 to 5-13) State monitoring of subrecipient compliance with FTA third party contracting requirements requires a review of procurement procedures, either through site visits or a periodic review of written procurement manuals. Some states provide written guidelines or standard terms and conditions to subrecipients and contractors for direct procurements. Some states review subrecipientsâ and contractorsâ direct procurements, particularly for vehicles, equipment, and construction. Such reviews, which generally focus on bid evaluation and selection, may be used to ensure that FTA (and state) requirements are met. However, the state is not required to review each subrecipientâs or contractorâs procurement to ensure compliance with federal requirements. The state may review selected procurements on a periodic basis in conjunction with a site visit or other general review of compliance with federal requirements. FTA developed a detailed âProcurement System Self-Assessment Guideâ which has a comprehensive list of questions that a state can use to assess a subrecipientâs procurement system. This guide is available online at http://www.fta.dot.gov/12831_6326.html. Before using the self-assessment guide, you may wish to review the following modules: Procurement Policies, Process, and History and Buy America and Vehicle Procurement Requirements. SUPPLEMENTAL NOTES States can require their subrecipients to comply with state-speciÏic procurement requirements as well as FTA requirements. Sources for guidance on how your stateâs procurement requirements Ïlow through to your stateâs FTA subrecipients can include the S. 5310 and/or 5311 State Management Plan and your stateâs procurement/purchasing code. Module 2.8: Introduction to Procurement LEVEL II - PAGE II-106
TIPS ON RELATIONSHIPS TO OTHER MODULES Other modules pertaining to procurement include: ⢠Procurement Policies, Process and History ⢠Disadvantaged Business Enterprise (DBE) ⢠Buy America and Vehicle Procurement Requirements Other areas of FTA compliance and various other certiÏications that recipients must sign and pass on to their contractors (âlower tier certiÏicationsâ), are related to procurement. You may wish to refer to other modules when they are cross-referenced. LINKS/INFO ⢠The 2-day NTI course âProcurement for Small and Medium Transit Systemsâ is recommended for âLevel 3â training for state transit program managers with subrecipient oversight responsibilities. ⢠For âLevel 3â training for state transit staff responsible for state procurements, the following NTI courses are recommended: -Procurement Series - I - Orientation to Transit Procurement (3.5 days). -Procurement Series - II - Risk Assessment and Basic Cost or Price Analysis (3.5 days). -Procurement Series - III - RFPs and Competitive Contract Negotiations (3 days). -Procurement Series - IV - Contract Administration (3.5 days). -Bus Procurement Workshop (2 days). ⢠FTAâs Procurement System Self-Assessment Guide. http://www.fta.dot.gov/12831_6326.html ⢠FTAâs FY2013 Procurement System Review Workshop Workbook. http://www.fta.dot.gov/grants/12900_14157.html ⢠FTAâs Best Practices Procurement Manual. http://www.fta.dot.gov/grants/13054_6037.html Module 2.8: Introduction to Procurement LEVEL II - PAGE II-107
QUIZ 1. Which of the following relationships are subject to FTA procurement requirements? A) Subrecipient purchase of an operating contract B) State purchase of vehicles on behalf of its subrecipients C) Subcontractor to subrecipient contract D) State award of a grant to a subrecipient 1) All of the above. 2) A & B. 3) all of the above. 4) A, B & C. 2. FTA subrecipients that are private entities are subject to more FTA procurement requirements than subrecipients that are public entities. 1) True. 2) False. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.8: Introduction to Procurement LEVEL II - PAGE II-108
INTRODUCTION FTA grantees (and subrecipients) use their own procurement procedures that reÏlect applicable state and local laws and regulations, provided that the process ensures competitive procurement and the procedures conform to applicable federal law, including 49 CFR Part 18 (speciÏically Section 18.36) and FTA Circular 4220.1F, âThird Party Contracting Guidance.â This module presents a basic summary of the FTA procurement requirements related to policies, process, and history (documentation), with details provided where they can assist in making the overview easier to understand. The statutes and regulations governing transit procurement include: ⢠Federal Transit Laws, Title 49, USC, Chapter 53; also public transportation provisions of Title 23, USC ⢠49 CFR Part 18 § 18.36 Procurement More details are found within FTA C 4220.1F - Third Party Contracting Guidance. KEY CONCEPTS Cost Eï¬ ciency Purchases made with FTA funding are expected to be cost-efÏicient and have a price consistent with the current market. This could be described as striving to get the most âbang for your buck.â To maximize cost efÏiciency, FTA requires that there be a âcost or price analysis with every procurement action.â This will be explained in more detail in the relevant sections of this module. In general terms, this means that before each time a state or subrecipient makes a decision to purchase something using FTA money, they need to do some sort of cost analysis or price comparison, and avoid choosing a product or service that would cost less from another vendor. IMPORTANCE FOR STATE DOT STAFF States are responsible for monitoring that subrecipients establish and follow their own federally-compliant procurement policies and procedures. FTA reserves the right to decline to participate in (i.e., deny funding for) the costs of third party procurements that fail to comply with federal laws, regulations, or the terms of the recipientâs underlying grant or cooperative agreement. Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-109
To make best use of funds, it is also important to purchase from vendors who have the capability to deliver the goods or services they promise. Full and Open CompeÆ Æ on States and subrecipients must provide qualiÏied vendors fair opportunity to obtain contracted work through full and open competition. Depending on the dollar value of the contract or purchase, there are different levels of effort that must be made to ensure open competition and different ways of going about soliciting bids or proposals. An important aspect of ensuring that all qualiÏied vendors have a chance to compete is ensuring that states and subrecipients not discriminate against businesses owned by persons of racial or ethnic minorities or women (i.e., comply with Disadvantaged Business Enterprise requirements). Ethics States and subrecipients of FTA funds are expected to make purchases in an ethical manner. This means following the stateâs (or the subrecipientâs) established procurement policies and procedures. Vendors should be selected based on their ability to provide the items or services at a competitive price. In contrast, unethical approaches could include awarding a contract to a vendor simply because they are a friend or family member, or because the person making the award would stand to gain Ïinancially, or because the vendor has offered some sort of bribe. Further, recipients and subrecipients are responsible for ensuring that selected vendors have not been debarred or suspended from participating in federal contracts (due to fraudulent behavior, for example). The following factors can affect applicability of speciÏic procurement requirements: ⢠The dollar value of the purchase - Generally speaking, purchases of higher dollar values are more complex, although there are certain requirements that apply to all FTA-funded purchases. ⢠The nature of the items or services being purchased - There are procurement requirements speciÏic to purchases of vehicles and other manufactured products, construction, certain types of service contracts, and architectural services. Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-110
DEFINITIONS The following are terms that are used throughout this module. Additional deÏinitions for terms used in a speciÏic section of the requirements will be provided in context of that section. For a more comprehensive set of procurement-related deÏinitions, see pages 5 through 11 of Chapter I of FTA C 4220.1F. Contract: a mutually binding legal relationship obligating the seller to furnish the supplies or services (including construction) and the buyer to pay for them. It includes all types of commitments that obligate the recipient to expenditure and that, except as otherwise authorized, are in writing. In addition to bilateral instruments, contracts include (but are not limited to) awards and notices of awards; job orders or task letters issued under basic ordering agreements; letter contracts; orders, such as purchase orders, under which the contract becomes effective by written acceptance or performance; and bilateral contract modiÏications. Full and Open Competition: all responsible sources are permitted to compete. In other words, the ability to compete for a contract award is not restricted, for example, to vendors with whom a relationship has been established, or to vendors within a limited geographic area. Independent Cost Analysis or Estimate (ICE): a tool to assist in determining the reasonableness or unreasonableness of the bid or proposal being evaluated that is required for all procurements regardless of dollar amount. This term comes from Circular 4220, which states: âGrantees must perform a cost or price analysis in connection with every procurement action, including contract modiÏications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, grantees must make independent estimates before receiving bids or proposals.â The independent estimate can range from a simple budgetary estimate to a complex estimate based on inspection of the product itself and review of items like drawings, speciÏications, and prior procurement data. The word âindependentâ does not imply that it is performed by someone other than the grantee. This could be the case, however, if the grantee does not have the expertise for a large complex procurement. Joint Procurement: a method of contracting in which two or more purchasers agree from the outset to use a single solicitation document and enter into a single contract with a vendor for delivery of property or services in a Ïixed quantity, even if expressed as a total minimum and total maximum. Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-111
Lower tier: a subcontract, below a higher-tier or prime contract in the hierarchy of contracts. Option: a unilateral right in a contract by which, for a speciÏied time, a recipient may acquire additional equipment, supplies, or services than originally procured. An option may also extend the term of the contract. Piggybacking: an assignment of existing contract rights to purchase supplies, equipment, or services. Revenue Contract: a contract in which the recipient or subrecipient provides access to public transportation assets for the primary purpose of either producing revenues in connection with a public transportation related activity, or creating business opportunities involving the use of FTA assisted property. Examples of revenue contracts include sale of advertising space on shelters and buses, or lease of space within an FTA-funded facility for concessions. Rolling Stock: buses, vans, cars, railcars, locomotives, trolley cars, ferry boats, and vehicles used for guideways and incline planes. SimpliÏied Acquisition Threshold: currently $150,000, as deÏined in Federal Acquisition Regulation (FAR) 2.101. Note that, based on guidance in place at the time this curriculum was drafted, FTA takes the position that the FAR clause 2.101 deÏinition of âsimpliÏied acquisition threshold,â which was increased from $100,000 to $150,000, does not apply to FTAâs federally assisted programs absent speciÏic guidance from the OfÏice of Management and Budget or DOT, which we have not received as of February 2011. Instead, FTA is continuing to use the dollar standard of the underlying original statute, establishing the simpliÏied acquisition threshold, 41 USC Section 403(11), referred to in the Common Grant Rule for governmental recipients (currently $100,000). But when federal regulations or guidance is issued, FTA will implement it appropriately. Third Party Contract: a recipientâs contract with a vendor or contractor, including procurement by purchase order or purchase by credit card, which is Ïinanced with federal assistance awarded by FTA. Turnkey Procurement: involves the consolidation of several contracts and separate functional efforts into a single project (such as design/build or design/build/operate). Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-112
SUMMARY OF FTA REQUIREMENTS Compliance with Federal Requirements as an Overarching Principal Before a subrecipient may use FTA assistance to support the acquisition of property or services, it must comply with all applicable federal laws and regulations, whether or not addressed in the Common Grant Rules. Some of those laws and regulations will affect the third party contractor providing the property or services, or even determine which entities may qualify as a third party contractor. Other laws and regulations will affect the nature of the property or services to be acquired or the terms under which the property or services must be acquired. A recipient may not use FTA assistance to support acquisitions that do not comply with all applicable federal requirements. FTAâs Master Agreement contains a current, but not all-inclusive, description of statutory and regulatory requirements that may affect a recipientâs procurement (such as DBE and Clean Air requirements). The Master Agreement states that applicable federal requirements will apply to project participants to the lowest tier necessary to ensure compliance with those requirements. A recipient will also need to include applicable federal requirements in each subagreement, lease, third party contract, or other document as necessary. Self-CerÆ fi caÆ on FTA expects each recipient to self-certify that its procurement system complies with federal requirements for any FTA assisted third party contract that the recipient undertakes and administers. WriÆ© en Standards of Conduct Subrecipients must maintain written standards of conduct governing the performance of their employees that are involved in the award or administration of third party contracts. These standards should prohibit personal conÏlicts of interest and gifts, and provide for penalties, sanctions, or other disciplinary action for violation of the standards. Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-113
WriÆ© en Policies and Procedures Subrecipients must have written policies and procedures that ensure full and open competition for FTA -funded procurements. The recipientâs procurement procedures are expected to address the following items: ⢠Clear Yet Non-Restrictive Solicitation Descriptions - When a recipient solicits quotes, bids, proposals, etc. from potential vendors, the solicitation must include a clear and accurate description of the technical requirements for the material, product, or service to be procured. A description may include a statement of the qualitative nature of the material, product, or service to be procured and, when necessary, describe minimum essential characteristics and standards to which the property or services must conform if it is to satisfy the recipientâs intended use. However, the description may not contain features that unduly restrict competition. FTA prefers that descriptions indicate functions to be performed or performance required, including the range of acceptable characteristics or minimum acceptable standards, rather than detailed product speciÏications. When it is impractical or uneconomical to write a clear and accurate description of the technical requirements of the property or services to be acquired, a âbrand name or equalâ description may be used to deÏine the performance or other salient characteristics of the property or services sought. ⢠Necessity (Recipientâs Need for the Property or Services) - Note: This element is required by the Common Grant Rule for non-governmental recipients, and recommended for governmental recipients. The recipient must have procedures to avoid the purchase of unnecessary property and services (including duplicative items and quantities or options it does not intend to use or whose use is unlikely). The recipientâs contracts may include options to ensure the future availability of property or services, so long as the recipient is able to justify those options as needed for its public transportation or project purposes. The recipient may contract only for its current and reasonably expected public transportation needs, and may not add quantities or options to third party contracts solely to permit assignment to another party at a later date, or acquire more vehicles than it needs for public transportation service in its service area. These limits on assignments, however, do not preclude joint procurements or state or local government purchasing schedules or purchasing contracts. ⢠Lease Versus Purchase - Note: This element is required by the Common Grant Rule for non-governmental recipients, and recommended for governmental recipients. To obtain the best value, the recipient should review lease versus purchase alternatives Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-114
for acquiring property and determine the more economical alternative. The recipient may use FTA capital assistance to Ïinance the costs of leasing eligible property if leasing is more cost effective than full ownership. Before the recipient may lease an asset, FTA regulations, âCapital Leases,â 49 CFR Part 639, Subpart C, require the recipient to make a written comparison of the cost of leasing the asset compared with the cost of purchasing or constructing the asset. Costs used in the comparison must be reasonable, based on realistic current market conditions, and based on the expected useful service life of the asset. ⢠Procurement Methods - including micro-purchases, small purchases, and, for projects that exceed the federal SimpliÏied Acquisition Threshold, more complex methods such as Invitation for Bids or Request for Proposals. ⢠Legal Restrictions - Any federal, state, or local restrictions on the recipientâs acquisitions should be indicated in the policies and procedures. ⢠Third Party Contract Provisions - The speciÏic provisions required for each third party contract including requirements that each third party contractor extend those provisions to its subcontractors to the extent required. FTA-required contract provisions are detailed by contract type in Appendix D of FTA C 4220.1F (pages D-1 through D-7). ⢠Sources (Availability and Use of Various Sources of Property and Services) - The FTA requirements related to sources of property and services are detailed in Chapter V of the C 4220.1F, and are brieÏly summarized later in this module. ⢠Resolution of Third Party Contracting Issues - The subrecipient must have written procedures to resolve third party contracting issues. The Common Grant Rules assign responsibility to FTA recipients for resolving all contractual and administrative issues arising out of their third party procurements, including source evaluation and selection and protests of awards, disputes, and claims using good administrative practices and sound business judgment. States and subrecipients are responsible for establishing written protest procedures as set forth in Chapter VII of FTA C 4220.1F. Although the responsibility to resolve issues rests with the state/subrecipient, FTA must be expeditiously notiÏied of any protests, with status updates provided as part of the quarterly Milestone/Progress Report submitted to FTA. FTA can, however, become involved in the recipientâs administrative decisions when a recipientâs protest decision is appealed to FTA, or when Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-115
the recipient seeks to use FTA assistance to support the costs of settlements or other resolutions of protests, disputes, claims, or litigation. FTA has its own appeals process for reviewing protests of a recipientâs procurement decisions, after a protester exhausts administrative remedies through the recipientâs protest procedures. ⢠Miscellaneous Federal Preferences - The Common Grant Rule for non-governmental recipients further requires written procurement procedures that address the following (which are also recommended for governmental recipients): -Metric Usage. The acceptance, to the extent practicable and economically feasible, of products and services dimensioned in the metric system of measurement. -Environmental and Energy EfÏiciency Preferences. A preference, to the extent practicable and economically feasible, for products and services that conserve natural resources, protect the environment, and are energy efÏicient. SolicitaÆ on Requirements and RestricÆ ons The Common Grant Rules require that each solicitation provide the following information: ⢠Description of the Property or Services. The solicitation and the contract awarded must include a clear and accurate description of the subrecipientâs technical requirements (speciÏications) for the property or services to be acquired in a manner that provides for full and open competition. ⢠Evaluation Factors. The solicitation must identify all factors to be used in evaluating bids or proposals. ⢠Contract Type SpeciÏied. The speciÏications should state the type of contract that will be awarded (such as Ïirm Ïixed price or cost reimbursement). The following types are expressly prohibited by the Common Grant Rule: Cost Plus a Percentage of Cost and Percentage of Construction Cost. ⢠Other Federal Requirements Affecting the Property or Services to be Acquired. See FTA 4220.1F Chapter IV, subsection 2.b, Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-116
and FTAâs latest Master Agreement for a list of applicable requirements. ⢠Other Federal Requirements Affecting the Bidder or Offeror and the Contractor. See FTA 4220.1F Chapter IV, subsection 2.a, and FTAâs latest Master Agreement for a list of applicable requirements. ⢠Award to Other than the Low Bidder. If the subrecipient intends to reserve its right to award to other than the low bidder or offeror, that information should be stated in the solicitation document. ⢠Rejection of All Bids or Offers. If the subrecipient intends to reserve its right to reject all bids or offers, that information should be stated in the solicitation document. In addition to above requirements, under federal appropriation laws, each state must include provisions in all its requests for proposals and solicitations stating that FTA is or will be providing federal assistance for the project, the amount of federal assistance FTA has provided or expects to provide, and the Catalog of Federal Domestic Assistance (CFDA) Number of the program that authorizes the federal assistance. FTA interprets the statute to require that subrecipients, lessees, or third party contractors of the state at any tier also comply with those notiÏication requirements. Procurement Methods The subrecipientâs policies and procedures should indicate that appropriate procurement methods depend on the project dollar amount and type of project. The recipient may not divide or reduce the size of its procurement merely to avoid the additional procurement requirements applicable to larger acquisitions. Note that states may adopt lower thresholds and require a more formalized competitive procurement for smaller projects than is required at the federal level. Federal methods include: ⢠Micro-Purchases - for purchases of $3,000 or less (current micro-purchase threshold under the Federal Acquisition Regulation or FAR). The recipient should distribute micro-purchases equitably among qualiÏied suppliers. ⢠Small Purchases - for purchases valued at more than $3,000 (current micro-purchase threshold under the FAR) but less than Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-117
$100,000 (based on the Common Rule threshold for governmental recipients at the time this curriculum was drafted). For small purchases, the recipient must obtain price or rate quotations from an adequate number of qualiÏied sources. ⢠For purchases valued at $100,000 or more (based on the Common Rule threshold for governmental recipients at the time this curriculum was drafted), more rigorous procurement methods are required. The most commonly used approaches include Sealed Bids (through an Invitation for Bids or IFB) or Competitive Proposals (through a Request for Proposals or RFP); both are introduced below. Depending on the nature of the work to be purchased, other potential approaches include Architectural Engineering (A&E) Services and Design-Bid-Build. The elements of each approach and their appropriate uses are described in 4220.1F Ch. VI, pages 9-17. A state may have its own nomenclature for these types of procurements. Sealed Bids Sealed bidding is a generally accepted procurement method in which bids are publicly solicited, and a Ïirm Ïixed price contract (lump sum or unit price) is awarded to the responsible bidder whose bid, conforming to all the material terms and conditions of the invitation for bids, is lowest in price. Sealed bid procurements should be used when precise, complete speciÏications are available for the item or service to be purchased, when there are two or more responsible bidders willing and able to compete effectively for the business, and when the successful bidder can be selected on the basis of price (which should be Ïixed) with no additional discussion necessary. The general process for sealed bid procurements includes developing the precise speciÏications, setting a deadline for submission of bids, publicly advertising the solicitation for bids with enough time for suppliers to respond, soliciting bids from suppliers, publicly opening the bids received by the deadline, and awarding the contract to the bidder with the lowest price (provided that they meet all requirements). CompeÆ Æ ve Proposals (Request for Proposals) Circumstances in which competitive proposals should be used include (but are not limited to) purchases when price alone is not the determining factor for selecting a supplier, or when discussions are anticipated before determining the best offer. The general process for competitive proposal procurements includes developing the speciÏications and evaluation criteria, setting a Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-118
deadline for submission of proposals, publicly advertising the solicitation with enough time for suppliers to respond, soliciting proposals from suppliers, evaluating the proposals received by the deadline, engaging in separate discussions with individual offeror(s) if needed, and awarding the contract to the responsible offeror whose proposal is most advantageous to the recipientâs program with price and other factors considered. Other than Full and Open CompeÆ Æ on and Sole Source Procurements Normally, the recipient must provide for full and open competition when soliciting bids or proposals. The Common Grant Rule for governmental recipients, however, acknowledges that under certain circumstances, a recipient may conduct procurements without providing for full and open competition. These circumstances are described in FTA C 4220.1F on pages 18-21. When the recipient requires supplies or services available from only one responsible source, and no other supplies or services will satisfy its requirements, the recipient may make a sole source award, provided that the award can be adequately justiÏied. Situations in which a sole source award could be justiÏied include: the offeror demonstrates a unique or innovative concept or capability not available from another source, patent or data rights restrictions preclude competition, and, in the case of a follow-on contract for the continued development or production of highly specialized equipment, when a new contractor would result in substantial duplication of costs and/or result in unacceptable delays in fulÏilling the recipientâs needs. Less than full and open competition would not be justiÏied based on the recipientâs lack of advance planning, or concerns about the amount of federal assistance available to support the procurement (for example, expiration of federal assistance previously available for award). If a recipient receives only a single offer in response to an IFB or RFP, the recipient should determine if competition was adequate. This should include a review of the speciÏications for undue restrictiveness and might include a survey of potential sources that chose not to submit a bid or proposal. Sources Allowable sources of property and services can include: Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-119
⢠Force account, which is the recipientâs own labor forces and equipment. The use of force account labor is a project management function, rather than a procurement and contract administration function, except in the general sense of the recipientâs ability to perform work with its own forces rather than contracting with another entity to acquire the property or services it needs, and the cost implications of the recipientâs decision. ⢠Shared Use. The Common Grant Rule for governmental recipients encourages recipients and subrecipients to enter into agreements for shared use of property and services, and FTA encourages non-governmental recipients to consider shared use if economical and feasible. ⢠Joint Procurements. FTA uses the term âjoint procurementâ to mean a method of contracting in which two or more purchasers agree from the outset to use a single solicitation document and enter into a single contract with a vendor for delivery of property or services in a Ïixed quantity, even if expressed as a total minimum and total maximum. Recipients participating in a joint procurement must ensure compliance with all applicable FTA and federal requirements and include all required clauses and certiÏications in the joint solicitation and contract documents. ⢠State or Local Government Purchasing Schedules or Purchasing Contracts. FTA uses the term âstate or local government purchasing scheduleâ to mean an arrangement that a state or local government has established with several or many vendors in which those vendors agree to provide essentially an option to the state or local government, and its subordinate government entities, to acquire speciÏic property or services in the future at established prices. FTA recognizes joint purchases to be the only type of intergovernmental agreement suitable for use by its grantees and subgrantees. The recipient must ensure all federal requirements, required clauses, and certiÏications (including Buy America) are properly followed and included, whether in the master intergovernmental contract or in the recipientâs purchase document. ⢠Federal Excess and Surplus Property. The Common Grant Rule for governmental recipients encourages recipients to use federal excess and surplus property managed by GSA when feasible and economical rather than procuring new property. ⢠Federal Supply Schedules. If speciÏically authorized by federal law, a recipient may use a GSA Federal Supply Schedule. State and local governments may use Federal Supply Schedules to acquire information technology (IT) and to purchase products and Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-120
services to facilitate recovery from a major disaster. The recipient must ensure all federal requirements, required clauses, and certiÏications (including Buy America) are properly followed and included. ⢠Existing Contracts. FTA permits a recipient to use existing contract rights held by another recipient (referred to as âpiggybackingâ) if 1) the terms and conditions of the option it seeks to exercise are substantially similar to the terms and conditions of the option as stated in the original contract at the time it was awarded, and 2) the recipient has determined that the option price is advantageous. However, if the contract options were not evaluated as part of the original contract award, or if recipient has negotiated a lower or higher price, the exercising of options amounts to a sole source award, which FTA only allows under very limited circumstances. ⢠The Open Market. The recipient will probably acquire most of the property and services it needs through procurements in the open market, following competitive procurement procedures. Note that FTA expects each recipient to limit its procurements to the amount of property and services required to meet its reasonably expected needs without adding excess capacity simply for the purpose of assigning contract rights to others at a later date. Contractor SelecÆ on - Basic Qualifi caÆ ons When selecting a contractor for an FTA-funded procurement, the grantee must consider not only technical ability to deliver the purchased service or product, but also ethical matters, including any potential conÏlicts of interest. Importantly, vendors who have been banned from participating in federal contracts (i.e., suspension or debarment) may not be awarded contracts or subcontracts. ⢠Responsibility. Contract awards may be made only to responsible contractors, that is, those contractors capable of successfully performing under the terms and conditions of the proposed contract. Before selecting a contractor for award, the recipient must consider such matters as contractor integrity, compliance with public policy, record of past performance, and Ïinancial and technical resources. Contractors must have the necessary organization, experience, accounting, operational controls, licenses, production capability, and technical skills to complete to project. Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-121
⢠Debarment and Suspension. Each grantee is required to ensure to the best of its knowledge and belief that none of its principals, afÏiliates, subrecipients, or third party contractors is suspended, debarred, ineligible, or voluntarily excluded from participation in federally assisted transactions or procurements. FTA requires grantees to review the Excluded Parties Listing System (EPLS) which is part of the System for Awards Management (SAM) (www.sam.gov) before entering into any third party contract expected to equal or exceed $25,000. Grantees may also treat any prospective contractor or subcontractor listed on a centralized state government debarment and suspension list as non-responsible and ineligible for contract award. ⢠ConÏlict of Interest. The Common Grant Rules require the recipient to be aware of conÏlict of interest issues a prospective contractor might have, including lack of impartiality, impaired objectivity, or unfair competitive advantage, as discussed more fully in FTA 4220.1F Chapter VI. DocumentaÆ on States and subrecipients must follow their procurement policies and procedures, and must keep records documenting this. Common Grant Rules require the recipient to prepare and maintain adequate and readily accessible project performance and Ïinancial records, covering procurement transactions as well as other aspects of project implementation, for three years after the recipient and subrecipients, if any, have made Ïinal payment and all other pending matters are closed. The following elements must be maintained in a written record of procurement history: ⢠Procurement Method. A governmental recipient must (and a non-governmental recipient should) provide its rationale for the method of procurement it used for each contract, including a sole source justiÏication for any acquisition that does not qualify as competitive, while a non-governmental recipient need only provide a justiÏication for lack of competition when it does not obtain competitive bids or proposals for contracts exceeding the simpliÏied acquisition threshold. ⢠Contract Type. A governmental recipient must (and a non-governmental recipient should) state the reasons for selecting the contract type it used. ⢠Contractor Selection. A governmental recipient must state its reasons for contractor selection or rejection. FTA expects the Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-122
recipient to include a justiÏication for each noncompetitive award. For procurements exceeding the simpliÏied acquisition threshold, a non-governmental recipient must state its reasons for contractor selection, but need not state its reasons for contractor rejection. Each recipient should include a written responsibility determination for the successful contractor. For micro-purchases, FTA only requires a determination that the price is fair and reasonable and a description of how the recipient made its determination. ⢠Cost or Price. Each recipient must evaluate and state its justiÏication for the contract cost or price. For micro-purchases, FTA only requires a determination that the price is fair and reasonable. For larger purchases, FTA requires cost or price analyses at several points in the process, described later in this module. C 4220.1F states that the extent of documentation should be reasonable. Documents included in a procurement history should be commensurate with the size and complexity of the procurement itself. FTA recognizes that these written records will vary greatly for different procurements. For example, a receipt or bill accompanying a $100 credit card purchase might contain all of the required information to support that procurement. Procurements that are more substantial may require extensive documentation. Federal Cost Principals Project costs must be necessary and reasonable, allocable to the project, authorized or not prohibited by federal law or regulation, and must comply with federal cost principles applicable to the recipient. Separate cost principles apply to the following four categories of recipients: ⢠Governmental Entities. OMB Guidance for Grants and Agreements, âCost Principles for State, Local, and Indian Tribal Governments (OMB Circular A-87),â 2 CFR Part 225, applies to project costs incurred by a recipient that is a state, local, or Indian tribal government. ⢠Educational Institutions. OMB Guidance for Grants and Agreements, âCost Principles for Educational Institutions (OMB Circular A-21),â 2 CFR Part 220, applies to project costs incurred by a recipient that is a public or private institution of higher education. Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-123
⢠Non-proÏit Entities. OMB Guidance for Grants and Agreements âCost Principles for Non-ProÏit Organizations (OMB Circular A-122),â 2 CFR Part 230, applies to project costs incurred by a recipient that is a private non-proÏit entity. ⢠For-ProÏit Entities. FAR at 48 CFR Chapter 1, Subpart 31.2, âContracts with Commercial Organizations,â applies to project costs incurred by a recipient that is a for-proÏit entity. Cost and Price Analyses The Common Grant Rules requires the recipient to perform a cost analysis or price analysis in connection with every procurement action, including contract modiÏications. The method and degree of analysis depends on the facts and circumstances surrounding each procurement. ⢠Before Receiving Bids or Proposals: Independent Cost Estimate (ICE). As a starting point, the recipient must make independent estimates before receiving bids or proposals. An ICE is necessary to determine the approximate cost of the project (which will determine what types of procurement methods may be used). This includes procurements that are ultimately piggybacked onto another organizationâs procurement. ICE documentation should be maintained as part of the written record for each procurement. The FTA Best Practices Procurement Manual provides guidance on how to prepare and document an ICE. (http://www.fta.dot.gov/funding/thirdpartyprocurement/grants_Ïinancing_6037.html) ⢠As Part of Evaluating Bids or Proposals: Cost or Price Analysis. -A price analysis is required to determine the reasonableness of the proposed contract price when there is adequate competition. For micro-purchases and small purchases, the price analysis can be abbreviated but still must be documented. -A cost analysis is required when a price analysis will not provide sufÏicient information to determine the reasonableness of the contract cost. The recipient must obtain a cost analysis when the offeror submits elements of the estimated cost (such as labor hours, overhead, materials, and so forth) for such projects as professional consulting and A&E contracts, sole source contracts, or other circumstances when price competition is inadequate. Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-124
-In awarding a contract that will include options, FTA expects the recipient to evaluate bids or offers for any option quantities or periods contained in a solicitation if it intends to exercise those options after the contract is awarded. ⢠Before Exercising Options. The recipient must determine that the option price is better than current market prices before exercising a contractâs options. This includes conducting another ICE at the time that options are exercised. ⢠Before Change Orders. A fair and reasonable cost analysis must be conducted prior to making any changes to the contract. To be eligible for FTA assistance under the recipientâs grant, the cost of the change must be allowable, allocable, within the scope of its grant, and reasonable for the completion of the changed work. Prohibited Contract Changes The following changes are not allowed for FTA-funded contracts: ⢠Improper Contract Expansions. These include a larger scope, greater quantities, options beyond the original recipientâs needs, or excess capacity added primarily to permit assignment of those contract rights to another entity. ⢠Cardinal Changes. These include a signiÏicant change in contract work (property or services) that causes a major deviation from the original purpose of the work or the intended method of achievement, or causes a revision of contract work so extensive, signiÏicant, or cumulative that, in effect, the contractor is required to perform very different work from that described in the original contract. Such practices are sometimes informally referred to as âtag-ons.â Examples of cardinal changes in vehicle manufacturing could include a change from a high-Ïloor to a low-Ïloor vehicle, or changing an engine or other major component, depending on the circumstances surrounding the project and whether a compatible replacement could be obtained through competition. FTA, however, considers changes to seating, fabrics, colors, exterior paint schemes, signage, Ïloor covering, and other similar changes permissible. Federal Requirements that Come with the Contract Selected contractors are subject to many FTA requirements in addition to the previously described general qualiÏication requirements. Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-125
Third-party contracts must include provisions for FTA requirements, and grantees are responsible for ensuring that their contractors and subcontractors comply with applicable requirements. As noted earlier, FTA-required contract provisions are indicated by contract type in Appendix D of FTA C 4220.1F (pages D-1 through D-7). Chapter IV of the 4220.1F provides more information on these and other FTA requirements that apply to the contract. States are expected to provide a mechanism to all contractors and subrecipients for access to the Master Agreement. The following list provides an overview of many of these requirements. This list is not exhaustive; state transit program managers should consult FTA C 4220.1F and the Master Agreement. ⢠Lobbying CertiÏication and Disclosure. If the third party contract will exceed $100,000, the recipient must obtain a lobbying certiÏication before awarding the contract, and if applicable, a lobbying disclosure from a prospective third party contractor. More information on FTA lobbying restrictions are found in the Lobbying module. ⢠Federal Civil Rights Laws and Regulations. Third party contractors at each tier must comply with: -Equal Employment Opportunity (EEO) - The contractor must not discriminate on the basis of race, color, creed/religion, national origin, sex, or age in employment or business opportunity for FTA-funded projects. There are several federal laws and regulations that address this area of discrimination. This set of regulations is addressed in the Equal Employment Opportunity module. -Americans with Disabilities Act (ADA) - the contractor must not discriminate against individuals in employment, public services, public accommodations, telecommunications, and other provisions, many of which are subject to regulations issued by other federal agencies. This set of regulations is addressed in the ADA module of the curriculum. In addition, other federal civil rights laws and regulations may affect the types of property and services that may be acquired with FTA assistance. They are mentioned only brieÏly in this module and described in more detail in other modules of this curriculum, as well as FTA C 4220.1F. Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-126
-Environmental Justice -Limited English ProÏiciency (LEP) - described under the Title VI module. -Section 504 of the Rehabilitation Act of 1973 - described under the ADA module. -Section 508 of the Rehabilitation Act of 1973 (accessibility of Electronic Reports and Information). -Title VI of the Civil Rights Act - described under the Title VI module. ⢠Labor Protection. Federal labor protection laws and regulations apply to certain third-party contracts. For federally-assisted contracts exceeding $100,000 in the categories of âturnkeyâ, revenue rolling stock, and construction, the third party contract must require the contractor to compute the wages of every mechanic and laborer based on a standard workweek of 40 hours, and to pay overtime beyond the 40 hour workweek, under the Contract Work Hours and Safety Standards Act. The Fair Labor Standards Act applies to employees performing work involving commerce. Contractors working on a capital project funded using federal assistance must give a hiring preference to veterans. ⢠Sensitive Security Information. Each third party contractor must protect, and take measures to ensure that its subcontractors at each tier protect, âsensitive security informationâ made available during the administration of a third party contract or subcontract. ⢠Environmental Protections. Recipients must include applicable environmental requirements in third party contracts. These are described in FTA Circular 4220.1F and include: -Adequate third party contract provisions to facilitate compliance with environmental mitigation measures the recipient has agreed to implement. -Compliance of acquisitions with the National Environmental Policy Actâdescribed under the Planning module. -Delaying acquisition of property until applicable environmental impact determinations have been made. -Obtaining a disclosure statement from the contractor selected to prepare an environmental impact statement specifying that the contractor has no Ïinancial or other interest in the outcome of the project. -Compliance with U.S. DOT requirements to protect publicly owned parks, recreation areas, wildlife and waterfowl refuges, and historic sites. Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-127
-Compliance with applicable provisions of the Clean Air Act and Clean Water Act, and not using facilities included in the Environmental Protection Agencyâs âList of Violating Facilitiesâ in any third party contract at any tier exceeding $100,000. -Providing a competitive preference for recycled products (required for governmental recipients). -Other federal environmental protection requirements that may be required for a particular procurement include provisions to protect wild and scenic rivers, manage coastal zones, protect wetlands, conserve endangered species, and protect Ïisheries, archeological sites, and Indian sacred sites. ⢠Energy Conservation. The Common Grant Rules require third party contract provisions as necessary for compliance with applicable energy efÏiciency standards and policies of state energy conservation plans issued under the Energy Policy and Conservation Act, as amended, 42 U.S.C. Sections 6321 et seq. ⢠Preference for U.S. PropertyâBuy America. FTAâs Buy America law and regulations apply to FTA-funded projects that involve the purchase of more than $100,000 of iron, steel, manufactured goods, or rolling stock. Buy America is described in the Buy America and Vehicle Requirements module. ⢠U.S. Flag Requirements for Shipments of Property and Project Travel. In third party contracts involving shipments by ocean vessel, U.S. Flag vessels must be used to transport at least 50 percent of any federally assisted property. Third party contracts involving shipments or project travel by air carrier require provisions to comply with the âFly Americaâ Act and GSA regulations, âUse of United States Flag Air Carriers,â which require shipment/travel by U.S. Ïlag air carriers unless such carriers are not reasonably available within the standards of GSAâs implementing regulations. Socio-Economic Development Requirements Each FTA recipient must comply with applicable federal laws and regulations that provide competitive opportunities for a contractor that qualiÏies as a disadvantaged business enterprise (DBE), minority owned Ïirm, womenâs business enterprise, or small business. ⢠Disadvantaged Business Enterprise (DBE) - each FTA recipient and subrecipient of FTA funding must comply with applicable requirements of DOT regulations, âParticipation by Disadvantaged Business Enterprises in Department of Transportation Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-128
Financial Assistance Programs,â 49 CFR Part 26. DBE requirements are addressed in the DBE module. ⢠Small and Minority Firms and Womenâs Business Enterprises. The Common Grant Rules require each recipient and subrecipient to take steps to ensure that it uses small and minority Ïirms and womenâs business enterprises (irrespective of whether they qualify as DBEs) to the fullest extent practicable. Each recipient is required to make information about procurement opportunities available to potentially qualiÏied Ïirms. Each governmental recipient is directed to include these contractors on solicitation lists and request their participation when they are potential sources. Under the Common Grant Rule, governmental recipients are directed to divide total contracting requirements into small tasks or quantities, when economically feasible, while non-governmental recipients are encouraged to contract with consortia when a contract is too large for one of these Ïirms to handle individually. Prime third party contractors of governmental recipients are expected to include related provisions in FTA assisted subcontracts, while non-governmental recipients are directed to consider whether Ïirms competing for larger contracts intend to subcontract with small businesses, minority-owned Ïirms, and womenâs business enterprises. For more information on this requirement, see the DBE module of this curriculum as well as Ch. IV page 8 of FTA C 4220.1F. Encouraged Safety PracÆ ces ⢠Seat Belt Use. FTA encourages each third party contractor to adopt and promote on-the-job seat belt use policies and programs for its employees and other personnel that operate company owned, rented, or personally operated vehicles, and to include this provision in each third party subcontract involving the project. ⢠Texting While Driving and Distracted Driving. FTA encourages each third party contractor to promote policies and initiatives for its employees and other personnel that adopt and promote safety policies that decrease crashes by distracted drivers, including policies to ban text messaging while driving, and to include this provision in each third party subcontract involving the project. Technical RestricÆ ons on the AcquisiÆ on of Property and Services Federal laws and regulations may impose technical requirements that affect a speciÏic procurement, including: Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-129
⢠Intelligent Transportation Systems. Intelligent transportation system (ITS) property and services must comply with the National ITS Architecture and Standards, and third party contracts involving ITS are likely to require provisions to ensure compliance with federal requirements. ⢠Metric Measurements. The recipient agrees to accept property and services with dimensions expressed in metric measurements, to the extent practicable and feasible. ⢠Use of $1 Coins. FTA assisted property that requires the use of coins or currency in public transportation service or supporting service must be fully capable of accepting and dispensing $1 coins. AdministraÆ ve RestricÆ ons on the AcquisiÆ on of Property and Services Federal laws and regulations impose administrative requirements that affect speciÏic third party procurements. ⢠Legal Eligibility. The property or services acquired must be eligible for FTA assistance to be used. ⢠Scope of the Project. The property or services acquired must be eligible for support within the scope of the underlying FTA grant or cooperative agreement. ⢠Period of Performance. Recipients are expected to use sound business judgment and be judicious in establishing and extending a contractâs period of performance. The period of performance generally should not exceed the time necessary to accomplish the purpose of the contract, and the recipientâs procurement Ïiles should document its rationale for determining the performance period designated for each contract. Procurements of non-rail rolling stock and replacement part contracts are limited by law to Ïive years, while rail procurements are limited to seven years, including option years. Time extensions that amount to a âcardinal changeâ will require a sole source justiÏication. Payment Provisions For FTA-funded procurements, FTA must indicate its general interest in the project before a recipient may use FTA assistance to Ïinance Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-130
or reimburse project costs, or use local share funds for project costs. FTA general interest is indicated via the grant award for the project, âpreaward authorityâ for the project through a Federal Register notice, or a âLetter of No Prejudiceâ (LONP) for the underlying project. LONP authority allows an applicant to incur costs on a project utilizing non-federal resources, with the understanding that the costs incurred subsequent to the issuance of the LONP may be reimbursable as eligible expenses or eligible for credit toward the local match should FTA approve the project at a later date. Advance Payments The recipient may not use FTA assistance to make payments to a third party contractor before the contractor has incurred the costs for which the payments would be attributable. The recipient may use its local share funds for advance payments (payments made to a contractor before the contractor incurs contract costs), but to be eligible for FTA funding, advanced approval from must be obtained FTA. FTA does occasionally make exceptions to its advance payment prohibitions, if the recipient can provide sound business reasons for doing so and has obtained FTAâs advance written concurrence. The recipient may use FTA assistance to support progress payments (payments for contract work that has not been completed) if the recipient obtains adequate security for those payments and has sufÏicient written documentation to substantiate the work for which payment is requested. This could include taking title or obtaining a letter of credit or equivalent measures to protect the recipientâs Ïinancial interest in the progress payment. ProtecÆ ons Against Performance Diï¬ culÆ es FTA expects the governmental recipient to include provisions or clauses for changes and changed conditions, and remedies for problems, such as liquidated damages for delayed contract completion or other measureable problems, remedies for violations or breach of the contract (required for projects exceeding $100,000), provisions related to suspension of work, and termination for cause or convenience provisions (required for contracts exceeding $10,000). In contracts that exceed the small purchase threshold (which FTA recognizes as the simpliÏied acquisition threshold), non-governmental recipients are required to include administrative, contractual, or legal contract remedies in instances in which a contractor violates or breaches terms of a contract, as well as termination clauses. Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-131
SUPPLEMENTAL NOTES ⢠States can require their subrecipients to comply with state-speciÏic procurement requirements as well as the FTA requirements. Sources for guidance on how your stateâs procurement requirements Ïlow through to your stateâs FTA subrecipients can include the S. 5310 and/or 5311 State Management Plan and your stateâs procurement/purchasing code. ⢠FTAâs Best Practices Procurement Manual (BPPM) is a good resource with examples for grantees to use in conducting FTA- assisted procurements. However, it is only a guidance document that is not updated frequently, and should not be referenced as a source of the regulations themselves. http://www.fta.dot.gov/funding/thirdpartyprocurement/grants_Ïinancing_6040.html TIPS ON RELATIONSHIPS TO OTHER MODULES Procurement requirements are also related to several other areas of FTA compliance, including DBE requirements, requirements related to ethics such as suspension/debarment and lobbying, and various other certiÏications that FTA recipients must sign and pass on to their contractors (âlower tier certiÏicationsâ). These relationships will be noted throughout this module, and you may wish to refer to other modules when they are cross-referenced. Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-132
LINKS/INFO ⢠The 2-day NTI course âProcurement for Small and Medium Transit Systemsâ is recommended for âLevel 3â training for state transit program managers with subrecipient oversight responsibilities. ⢠For âLevel 3â training for state transit staff responsible for state procurements, the following NTI courses are recommended: -Procurement Series - I - Orientation to Transit Procurement (3.5 days). -Procurement Series - II - Risk Assessment and Basic Cost or Price Analysis (3.5 days). -Procurement Series - III - RFPs and Competitive Contract Negotiations (3 days). -Procurement Series - IV - Contract Administration (3.5 days). -Bus Procurement Workshop (2 days). ⢠FTAâs Procurement System Self-Assessment Guide. http://www.fta.dot.gov/12831_6326.html ⢠FTAâs FY2013 Procurement System Review Workshop Workbook. http://www.fta.dot.gov/grants/12900_14157.html ⢠FTAâs Best Practices Procurement Manual. http://www.fta.dot.gov/grants/13054_6037.html ⢠FTA âFrequently Asked Questionsâ pertaining to third party contracting. http://www.fta.dot.gov/funding/thirdpartyprocurement/grants_Ïinancing_6039.html ⢠The American Public Transportation Association (APTA) developed the following materials regarding transit procurements: -The Process of Transit Procurement (March 2013). http://www.apta.com/resources/standards/Documents/APTA-PS-PP- RP-007-13.pdf -Transit Procurement: A Guide for Transit Board Members (Oct. 2010). Provides a brief summary of the FTA thresholds and the steps required to plan and execute an FTA-compliant procurement; a good high-level introduction of key concepts. http://www.apta.com/resources/bookstore/Documents/Transit%20Procurement%20Manual.pdf Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-133
QUIZ 1. Sealed bidding is recommended when factors other than price will be used to decide on the best offer. 1) True. 2) False. 2. Which of the following circumstances must exist for piggybacking to be allowed? 1) the terms and conditions of the option it seeks to exercise are substantially similar to the terms and conditions of the option as stated in the original contract at the time it was awarded. 2) when a recipient is able to negotiate a lower price than would be available through a new contract. 3) when a cardinal change would allow the grantee to purchase the item more efÏiciently. 4) none of the above. 3. FTA encourages grantees to give local suppliers preference over suppliers in other states. 1) True. 2) False. 4. A grantee may make a sole source award in cases where patent or data rights restrictions preclude competition. 1) True. 2) False. Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-134
5. What is the dollar threshold at which grantee must check the Excluded Parties Listing System (EPLS) before awarding a contract? 1) $2,000. 2) $3,000. 3) $25,000. 4) $100,000. 6. An independent cost estimate (ICE) must be prepared: A) before accepting bids or offers. B) when evaluating contract options. C) before exercising contract options. 1) A. 2) A & C. 3) all of the above 4) none of the above 7. FTA assisted property that requires the use of coins or currency in public transportation service or supporting service must be fully capable of accepting and dispensing $1 coins. 1) True. 2) False. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.9: Procurement Policies, Process, and History LEVEL II - PAGE II-135
KEY CONCEPTS ⢠DBE Program Threshold ⢠DBE Goals ⢠Administrative Requirements (Fostering Small Businesses, Public Participation, Uniform Report, etc.) ⢠Oversight of Subrecipients and Contractors ⢠CertiÏication INTRODUCTION States and their subrecipients must ensure nondiscrimination in the award and administration of DOT-assisted contracts, as described in 49 CFR Part 26. SpeciÏically, recipients who award prime contracts exceeding $250,000 in FTA funds in a Ïiscal year (excluding transit vehicle purchases) must have a Disadvantaged Business Enterprise (DBE) program. States and their subrecipients must create a level playing Ïield on which DBEs can compete fairly for contracts; ensure that only Ïirms that fully meet eligibility standards are permitted to participate as DBEs; help remove barriers to DBE participation; and assist the development of Ïirms that can compete successfully in the marketplace outside the DBE program. Note: DOT issued a notice of proposed rulemaking (NPRM) concerning various modiÏications to the DBE program in September 2012. It held a public listening session in October 2013 and accepted comments until the end of October 2013, shortly after this curriculum was drafted. The NPRM included three categories of changes: revisions to various DBE forms, modiÏications to certiÏication provisions, and modiÏications to other provisions such as good faith efforts and transit vehicle manufacturers. For more details, as well as the issuance of a Ïinal rule, see: Federal Register, Vol. 77, No. 173. September 6, 2012. âDisadvantage Business Enterprise: Program Implementation ModiÏications.â http://www.gpo.gov/fdsys/pkg/FR-2012-09-06/ pdf/2012-21231.pdf. IMPORTANCE FOR STATE DOT STAFF DBE regulations apply to all third party contracts that are funded in whole or in part with FTA or FHWA planning, capital, or operating assistance. State DOTs that meet a certain threshold must have a DBE program in place, set overall goals for DBE participation, and monitor their subrecipients and contractors for compliance. Recipients are not eligible to Module 2.10: Disadvantaged Business Enterprise LEVEL II - PAGE II-136
receive DOT funding if they fail to establish an approved DBE program or overall goal, or if they fail to implement the program in good faith. The recipientâs DBE program is incorporated by reference in its certiÏications and assurances. Implementation of the program is a legal obligation. States must monitor the dollar values of their subrecipientsâ contracting opportunities to determine if any individual subrecipients cross the threshold when a formal DBE program becomes a requirement. DEFINITIONS Disadvantaged Business Enterprise (DBE): a for-proÏit small business (1) that is at least 51 percent owned by one or more individuals who are both socially and economically disadvantaged (in the case of a corporation, 51 percent of the stock); and (2) whose management and daily business operations are controlled by one or more of the socially and economically disadvantaged owner(s). Good Faith Efforts: efforts to achieve a DBE goal or other requirement which, by their scope, intensity, and appropriateness to the objective, can reasonably be expected to fulÏill the program requirement. Primary Industry ClassiÏication: the North American Industrial ClassiÏication System (NAICS) designation that best describes the primary business of a Ïirm. www.ntis.gov/product/naics.htm. Race-Conscious Measure or Program: focused speciÏically on assisting DBEs, including women-owned DBEs. Race/Gender-Neutral Measure or Program: used to assist all small businesses. While beneÏiting DBEs, such programs are not solely focused on DBE Ïirms. Set-Aside: restricting eligibility for the competitive award of a contract solely to DBE Ïirms. Small Business: does not exceed the cap on average annual gross receipts speciÏied in § 26.65(b). Module 2.10: Disadvantaged Business Enterprise LEVEL II - PAGE II-137
Socially and Economically Disadvantaged Individual: US citizens or lawfully admitted permanent residents who are: Black Americans, Hispanic Americans, Native Americans, Asian-PaciÏic Americans, Subcontinent Asian Americans, or women. Individuals can be deemed socially and economically disadvantaged on a case-by-case basis, and additional groups may be designated by the Small Business Administration. SUMMARY OF FTA REQUIREMENTS Written DBE programs are required of recipients of FTA assistance that meet threshold criteria: those that will have contracting opportunities (excluding transit vehicle purchases) exceeding $250,000 in FTA funds in a Ïiscal year. If the state meets the threshold, it must submit its program through TEAM-Web for approval by the FTA (the state may be allowed to submit a single plan to FHWA if it receives more funding from FHWA than from FTA). Contracting opportunities are counted in the aggregate, and include purchase orders, capital projects, professional services, Transportation Infrastructure Finance and Innovation Act (TIFIA) loan funded projects, and the contracting activities of subrecipients. DBE Liaison Oï¬ cer The DBE program must be administered by a DBE liaison ofÏicer (DBELO) who has direct, independent access to the stateâs CEO (i.e., the governor) concerning DBE matters. This does not require a direct reporting relationship; it means that the DBELO must be able to communicate to the CEO about DBE program matters without any other personâs consent or sign-off. The DBELO should not have a conÏlict of interest (e.g. s/he is also the procurement director). However, small grantees with limited personnel may provide an explanation for this type of arrangement and how conÏlict of interest situations are handled. States must also have adequate staff to administer the program. Basic DBE Program Characteristics ⢠Administered by a DBE Liaison OfÏicer ⢠Circulated internally within the agency and externally to contractors ⢠Includes annual DBE goals ⢠Requires submission of all awarded/completed contracts through the Uniform Report Module 2.10: Disadvantaged Business Enterprise LEVEL II - PAGE II-138
Policy Statement States must issue a signed and dated policy statement that expresses commitment to the DBE program and outlines its objectives and implementation. This statement must circulate throughout the agency and to DBE and non-DBE contractors. Program Updates The DBE program must be updated when signiÏicant changes occur (e.g., a change in the DBELO position/CEO reporting relationship). Transit Vehicle Manufacturer CerÆ fi caÆ ons States must also require in their DBE programs that all transit vehicle manufacturers (TVMs) bidding on FTA-assisted procurements comply with DBE requirements. FTA certiÏies that the TVMs meet DBE requirements and issues TVMs DBE certiÏications. The state and its subrecipients must obtain DBE certiÏications from all the TVMs with bids submitted; vehicles are not included in the $250,000 threshold because of this separate process. Overall Goals Recipients meeting the DBE threshold must determine overall three-year agency goals and submit them to the FTA for review every three Ïiscal years (by the preceding August). The overall goals are a percentage of all FTA funds (except funds for the purchase of transit vehicles) that the state and its subrecipients will expend in FTA-assisted contracts during the period covered. As discussed later in the module, recipients may also need to set goals for individual contracts with subcontracting opportunities, to help attain their overall agency goals. Goal-SeÆ« ng Recipients must set their overall goals based on the availability of ready, willing, and able DBEs relative to all ready, willing, and able businesses (i.e. the ârelative availability of DBEsâ). The goal must reÏlect the level of DBE participation that could be expected absent the effects of discrimination. Module 2.10: Disadvantaged Business Enterprise LEVEL II - PAGE II-139
U.S. DOT has a national goal that not less than 10 percent of authorized funds are to be expended with DBEs. However, states cannot rely on either this 10 percent national goal, or their previous goals, or past DBE participation rates without reference to the current relative availability of DBEs. In the goal submission, the state must detail the data sources it uses to determine the number of DBEs and their relative availability. Goal Setting Step 1: Determine a base Ïigure for the relative availability of DBEs. Approaches include: ⢠Using a DBE directory plus Census data (see the County Business Pattern database at www.census.gov/epcd/cbp/view/ cbpview.html), dividing the number of DBEs by the number of all businesses. ⢠Using a previous yearâs bidders list, dividing the number of DBEs by the number of all businesses. ⢠Using a percentage Ïigure from a disparity study. ⢠Using the goal of another peer DOT recipient. ⢠Alternative methods. Step 2: Examine other evidence to adjust the base Ïigure. Types of evidence include: ⢠The current capacity of DBEs, measured by the volume of work DBEs have recently performed; ⢠Disparity studies conducted within the jurisdiction; and ⢠Adjustments based on local markets and program speciÏics, if the base is from a peer. Recipients must also consider other available data relating to the opportunities DBEs have to form, grow, and compete (e.g. data on education, training programs, etc.). Module 2.10: Disadvantaged Business Enterprise LEVEL II - PAGE II-140
The submission must also estimate the portion of the goal the state expects to meet through race/gender-neutral means (as opposed to race/gender-conscious means). Race/gender-neutral means include the following: 1) Arranging solicitations, times for the presentation of bids, quantities, speciÏications, and delivery schedules in ways that facilitate participation by DBEs and other small businesses. 2) Providing assistance to overcome limitations such as inability to obtain bonding or Ïinancing; 3) Providing technical assistance and other services; 4) Communicating contracting procedures and speciÏic contract opportunities (e.g., including DBEs on bidder mailing lists, providing information in other languages, etc.); 5) Implementing a supportive services program so that DBEs can develop and improve business management, record keeping, and Ïinancial and accounting capabilities; 6) Providing services to help DBEs, and other small businesses, improve long-term development, increase opportunities to participate in a variety of kinds of work, handle increasingly signiÏicant projects, and achieve eventual self-sufÏiciency; 7) Establishing a program to assist new, start-up Ïirms, particularly in Ïields in which DBE participation has historically been low; 8) Ensuring distribution of the DBE directory, through print and electronic means, to the widest feasible universe of potential prime contractors; and 9) Assisting DBEs, and other small businesses, to develop their capability to utilize emerging technology and conduct business through electronic media. Both the stateâs contracting activities and those of its subrecipients should be incorporated into the overall agency goal-setting. Achieving Goals States must meet the maximum feasible portion of their overall goals through race/gender-neutral means. However, the remaining portion of the overall goal can be met through race/gender-conscious means (âcontract goalsâ). Recipients must establish contract goals to meet any portion of the agencyâs overall goal it does not project being able to meet using race-neutral means. Contract goals are not required on every DOT-assisted contract, and may only be used on those DOT-assisted Module 2.10: Disadvantaged Business Enterprise LEVEL II - PAGE II-141
contracts that have subcontracting possibilities. The goal for a speciÏic contract may be higher or lower than that percentage level of the overall goal, depending on such factors as the type of work involved, the location of the work, and the availability of DBEs for the work of the particular contract. However, over the period covered by a recipientâs overall goal, the recipient must set contract goals so that they will cumulatively result in meeting any portion of the overall goal the agency projects being unable to meet through the use of race-neutral means. The recipient should make adjustments throughout the year, increasing or decreasing the use of race/gender-neutral and/or race/ gender-conscious means in order to achieve the overall goal. Note that your state may have state-speciÏic requirements related to DBE goals beyond the federal requirements. Bidders List To facilitate goal setting, states must also create and maintain a bidders list with information on all DBE and non-DBEs seeking contract work (including Ïirm name, address, DBE status, age, and annual gross receipts). Information for the bidders list can come from a variety of sources (e.g. collect information from all bidders, conduct a statistically sound survey, etc.). Fostering Small Business ParÆ cipaÆ on As an additional requirement (in place since 2012), states must include and implement an element in their DBE programs for fostering small business participation. The element must have strategies to eliminate obstacles to small businesses (e.g. no unnecessary/unjustiÏied bundling of contract requirements). Strategies for this element include: ⢠Establish a race and gender-neutral small business set-aside for prime contracts under a stated amount. ⢠In multi-year design-build contracts or other large contracts, require bidders on the prime contract to specify elements of the contract or speciÏic subcontracts that are of a size that small businesses, including DBEs, can reasonably perform. ⢠On prime contracts not having DBE contract goals, require the prime contractor to provide subcontracting opportunities of a Module 2.10: Disadvantaged Business Enterprise LEVEL II - PAGE II-142
size that small businesses, including DBEs, can reasonably perform, rather than self performing all the work involved. ⢠Identify alternative acquisition strategies and structuring procurements to facilitate the ability of consortia or joint ventures consisting of small businesses, including DBEs, to compete for and perform prime contracts. ⢠To meet the race-neutral portion of overall agency goal, ensure that a reasonable number of prime contracts are of a size that small businesses, including DBEs, can reasonably perform. Public ParÆ cipaÆ on In establishing an overall three-year goal, states must provide for public participation. The public participation process must include: 1) Consultation with minority, womenâs, and general contractor groups, community organizations, and other ofÏicials or organizations that may have information on the availability of DBEs/non-DBEs, and the effects of discrimination on opportunities for DBEs. 2) A notice (published in general circulation media, available minority-focused media, and trade association publications) announcing the proposed overall goal and its availability for inspection for 30 days. The notice must also publicize a 45 day comment period. ReporÆ ng Requirements Threshold recipients must submit a Uniform Report of DBE Awards or Commitments and Payments (see Appendix B of 49 CFR 26) semi-annually in TEAM-Web. The Uniform Report details all awarded and completed contracts for the state and its subrecipients, to both DBEs and non-DBEs. If the Uniform Report shows that the awards and commitments were less than the overall goal for that year, the recipient must do the following to demonstrate that they are implementing the DBE program in good faith: 1) Analyze in detail the reasons for the difference (a shortfall analysis). 2) Establish speciÏic steps and milestones to correct the problems in the next Ïiscal year. The 50 largest transit authorities (as determined by the FTA) must submit, within 90 days of the end of the Ïiscal year, these analyses Module 2.10: Disadvantaged Business Enterprise LEVEL II - PAGE II-143
and corrective actions for approval. All others must retain the analyses and corrective actions for three years in case the FTA requests to review them. Monitoring Requirements In addition to their own responsibilities, states must monitor their subrecipients and contractors for compliance with DBE regulations (this process should be detailed in the stateâs DBE program). For its own contractors, the state must: ⢠Include a written certiÏication that it has reviewed contracting/payroll records and monitored work sites to ensure that DBEs are actually performing the work committed to them. ⢠Tally actual payments made to DBE Ïirms in comparison to commitments. ⢠Promptly pay DBE invoices. ⢠Obtain certiÏications from TVMs. ⢠Ensure that prime contractors do not terminate or substitute a DBE subcontractor listed on a contract with a DBE goal without good cause and prior written consent. If the state has DBE contract goals, it must award contracts only to bidders who make good faith efforts to obtain DBE participation. This means that the state must judge if the bidder has either met the goal or has taken necessary and reasonable steps to try to achieve the goal (see Appendix A of 49 CFR 26 for examples of good faith efforts). However, the state cannot deny a contract on the basis that the bidder failed to meet a DBE contract goal. Subrecipients must be monitored by states to ensure inclusion of required contract clauses as well as to ensure they are monitoring their own contractors for adherence to DBE commitments. States should: ⢠Monitor the dollar values of their subrecipientsâ contracting opportunities to determine if any individual subrecipients cross the $250,000 threshold when a formal DBE program becomes a requirement. Module 2.10: Disadvantaged Business Enterprise LEVEL II - PAGE II-144
⢠Ensure that subrecipients exceeding the $250,000 threshold prepare and submit a DBE program, which the state is responsible for reviewing and approving. ⢠Monitor subrecipients requiring a DBE program to ensure that they: -designate a DBELO who has direct, independent access to the subrecipientâs CEO concerning DBE matters. -have a signed and dated policy statement that expresses commitment to the DBE program and outlines its objectives and implementation. This statement must circulate throughout the agency and to DBE and non-DBE contractors. -update their DBE program when signiÏicant changes occur (e.g., a change in the DBELO position/CEO reporting relationship). -establish and update an overall agency program goal set by the subrecipient. -maintain a bidders list. -for vehicle procurements, obtain DBE certiÏications from all the TVMs with bids submitted -submit a Uniform Report of DBE Awards or Commitments and Payments to state at least semi-annually. -monitor their own subrecipients, contractors and subcontractors for DBE compliance. CerÆ fying DBEs States must participate in a UniÏied CertiÏication Program (UCP), if not as the certifying agency itself than as a signatory to the UCP agreement. The certiÏication procedures help ensure that only eligible DBEs participate in the DBE program. If the state certiÏies DBEs itself, it must: ⢠Use the correct application form, instructions and document checklist; ⢠Conduct site visits prior to certiÏication; ⢠Obtain annual afÏidavits from each certiÏied DBE afÏirming that the DBE continues to meet the eligibility criteria of the regulation; ⢠Comply with Interstate CertiÏication requirements; and ⢠Include the NAICS codes of DBEs in the UCP directory. Module 2.10: Disadvantaged Business Enterprise LEVEL II - PAGE II-145
SUPPLEMENTAL NOTES One of the objectives of the DBE regulations is to help remove barriers to the participation of DBEs in DOT-assisted contracts. However, in some cases, DBE Ïirms may be overconcentrated in a certain Ïield of work to such an extent that they unduly burden the opportunity of non-DBE Ïirms to participate. States must then take measures to address the overconcentration, using incentives, technical assistance, business development programs, and/or mentor-protégé programs. Once approved by DOT, these measures become part of the stateâs DBE program. U.S. DOT published a notice of proposed rulemaking on 49 CFR Part 26 on Sep. 6, 2012. If adopted, the new regulations will impact required forms, certiÏication -related provisions, good faith efforts, and transit vehicle manufacturers. At the time this curriculum was developed, a Ïinal rule had not been released, and the requirements outlined in this document do not reÏlect the proposed changes. TIPS ON RELATIONSHIPS TO OTHER MODULES DBE requirements are a subset of the requirements related to procurement; they are discussed as a standalone unit because of their complexity. DBE requirements are also conceptually related to other civil rights requirements (such as Title VI, EEO, and ADA) that seek to ensure that federally funded programs and services are nondiscriminatory; DBE requirements are designed to ensure that business opportunities offered by FTA funding recipients are nondiscriminatory. FTAâs OfÏice of Civil Rights oversees all of these requirements. LINKS/INFO ⢠49 CFR 26, Participation by Disadvantage Business Enterprises in DOT Financial Assistance Programs. http://www.ecfr.gov. ⢠NTI Course on Disadvantaged Business Enterprise. http://www.ntionline.com/courses/list.php. Module 2.10: Disadvantaged Business Enterprise LEVEL II - PAGE II-146
⢠FTA Disadvantaged Business Enterprise Website. http://www.fta.dot.gov/civilrights/12326.html. ⢠Guidance to Complete New DBE Implementation Plans. http://www.fta.dot.gov/12326_14267.html. ⢠OSDBUâs Guidance for DBE Program Administrators. http://www.dot.gov/osdbu/disadvantaged-business-enterprise/ guidance-dbe-program-administrators. ⢠Federal Register, Vol. 77, No. 173. September 6, 2012. âDisadvantage Business Enterprise: Program Implementation ModiÏications.â http://www.gpo.gov/fdsys/pkg/FR-2012-09-06/pdf/2012-21231.pdf. QUIZ 1. States are required to set contract goals on all DOT-assisted contracts. 1) True. 2) False. 2. In setting DBE overall goals, recipients should: A) Use the 10 percent national goal B) Base the goal on past DBE participation rates C) Determine the relative availability of DBEs in the market D) Use a variety of evidence to adjust the base Ïigure for the relative availability of DBEs 1) A. 2) B. 3) B. & C. 4) C. & D. Module 2.10: Disadvantaged Business Enterprise LEVEL II - PAGE II-147
3. Which of the following are strategies recommended by FTA to support participation by DBEs and small businesses? A) Requiring the prime contractor to provide subcontracting opportunities of a size that small businesses, including DBEs, can reasonably perform, rather than self performing all the work involved B) Bundling as many contract opportunities as possible into a single solicitation C) Requiring prompt payment of DBE subcontractor invoices D) Designating geographic preferences 1) A. 2) A. & B. 3) A. & C. 4) all of the above. 4. States are required to ensure that subrecipients monitor DBE compliance of their contractors and subcontractors to ensure that their DBE obligations are fulÏilled. 1) True for all subrecipients. 2) True for subrecipients with FTA-funded contracting opportunities (excluding transit vehicle purchases exceeding $250,000 in a Federal Ïiscal year). 3) False. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.10: Disadvantaged Business Enterprise LEVEL II - PAGE II-148
INTRODUCTION Federal funds may not be obligated unless steel, iron, and manufactured products used in FTA funded projects are produced in the United States. Grantees must conduct pre-award and post-delivery audits of purchases of revenue rolling stock (vehicles) in order to verify that Buy America provisions, Federal Motor Vehicle Safety Standards, and purchaserâs requirements are met. As part of each application to FTA for the purchase or lease of any new bus model, or any bus model with a major change in conÏiguration or components, the recipient must certify that the bus was tested at the FTA bus testing facility. Prior to Ïinal acceptance of the Ïirst vehicle manufactured in a procurement, the FTA grantee must obtain a copy of the test report under the FTA Bus Testing Program. The statutes and regulations governing Buy America and procurement requirements speciÏic to vehicles include: ⢠49 CFR Part 571, âFederal Motor Vehicle Safety Standardsâ ⢠49 CFR Part 661, âBuy America Requirementsâ ⢠49 CFR Part 663, âPre-Award and Post-Delivery Audits of Rolling Stock Purchasesâ ⢠FTA âDear Colleagueâ Letter, March 18, 1997 ⢠Federal Register Vol. 71, No. 54, pp. 14112-14118, Buy America Requirements; Amendments to DeÏinitions ⢠Federal Register Vol. 72, No. 182, pp. 53688-53698, Buy America Requirements; End Product Analysis and Waiver Procedures, Final Rule ⢠Federal Register Vol. 72, No. 188, pp. 55103-55104, Buy America Requirements; End Product Analysis and Waiver Procedures, Final Rule correction ⢠Federal Register Vol. 77, No. 28, pp. 71673 -71678, Decision To Rescind Buy America Waiver for Minivans and Minivan Chassis ⢠49 USC Section 5318, Bus testing facility ⢠49 CFR Part 665, âBus Testingâ More details are found within FTA C 4220.1F - Third Party Contracting Guidance. Module 2.11: Buy America and Vehicle Requirements LEVEL II - PAGE II-149
IMPORTANCE FOR STATE DOT STAFF States are responsible for monitoring that subrecipients establish and follow their own federally-compliant procurement policies and procedures for making purchases. FTA reserves the right to decline to participate in (i.e., deny funding for) the costs of third party procurements that fail to comply with federal laws, regulations, or the terms of the recipientâs underlying grant or cooperative agreement. KEY CONCEPTS A very brief summary of steps involved for FTA-funded solicitations valued $100,000 or more includes: 1. Apply for FTA funding. 2. Execute grant agreement. 3. Develop IFB or RFP. 4. Advertise solicitation. 5. Evaluated bids or proposals received. 6. Select best bid/proposal. 7. Conduct pre-award review. 8. Award contract. 9. Order vehicles. 10. If contract is for more than 10 vehicles, conduct on- site inspections during manufacture. 11. Conduct post-delivery review. 12. Accept vehicles. Procuring Vehicles Takes Time The act of buying a transit vehicle using FTA funds is a rather lengthy process, and states and subrecipients need to consider this when planning services that require new vehicles, as well as for planning replacements of existing assets. It is not unusual for an FTA-funded vehicle purchase to take 12-18 months to complete (with transit coaches generally taking longer than smaller paratransit vehicles), from the time the IFB or RFP is issued until new vehicles can be put into service. The development of the IFB or RFP itself takes time, as detailed technical and performance speciÏications need to be included. DEFINITIONS Component: Any article, material, or supply, that is directly incorporated into an end product at the Ïinal assembly location. Manufactured product: an item produced as a result of the manufacturing process. Module 2.11: Buy America and Vehicle Requirements LEVEL II - PAGE II-150
Manufacturing process means the application of processes to alter the form or function of materials or of elements of the product in a manner adding value and transforming those materials or elements so that they represent a new end product functionally different from that which would result from mere assembly of the elements or materials. Post-delivery: The period during the procurement process beginning with the signing of a formal contract with the selected contractor. It includes the period of bus manufacturing, inspection, testing, and delivery. It ends with bus title transfer or the placement of the buses into revenue service, whichever is Ïirst. Pre-award: The period during the procurement process before the recipient enters into a formal contract with the supplier. Rolling stock: transit vehicles such as buses, vans, cars, railcars, locomotives, trolley cars, and ferry boats, as well as vehicles used for support services. Subcomponent: Any article, material, or supply that is one step removed from a component. UnmodiÏied van: A primary manufacturerâs standard production van that requires no further manufacturing operations to perform its intended function, other than the addition, substitution, or removal of readily available attachable components (such as mirrors, or tire and rim assemblies), or minor Ïinishing operations (such as painting). SUMMARY OF FTA REQUIREMENTS Buy America Requirements Buy America regulations are found in 49 CFR 661 and 49 CFR 663. FTA provided guidance to grantees through its âDear Colleagueâ letter C-97-03 dated March 18, 1997. Buy America regulations require that all procurements of steel, iron, and manufactured products, except for those subject to an FTA waiver, contain Buy America provisions. Waivers are listed in Appendix A to 49 CFR 661.7 and include microcomputer equipment Module 2.11: Buy America and Vehicle Requirements LEVEL II - PAGE II-151
and software and purchases under $100,000. The small purchase limitation is based on the value of the procurement, not the price of the item. For example, a purchase of four vans that totals $120,000, even though each van costs $30,000, must comply with the Buy America requirements. Grantees may not split procurements that exceed the threshold in order to avoid Buy America requirements. For construction projects and projects involving the installation of manufactured products, the threshold is based on the total value of the project, not the value of the steel, iron, and manufactured products purchased for the project. The requirements apply to subcontractors, regardless of the size of their contract, if the prime contract is more than $100,000. The requirements apply when a subrecipient jointly purchases manufactured products. Subrecipients are required to pass the requirements down to management or service contractors when the contractor is making FTA funded procurements on the subrecipientâs behalf. For vehicle procurements, compliance with Buy America regulations involves several activities: ⢠Buy America Clause and CertiÏication in the Procurement Solicitation ⢠Pre-Award Review ⢠On-Site Inspection ⢠Post-Delivery Review Clause and CerÆ fi caÆ on in the Procurement SolicitaÆ on The grantee must include a clause citing the Buy America requirement and a Buy America certiÏication in its IFBs and RFPs. There are different certiÏications for procurements of rolling stock (vehicles) than for procurements of other steel, iron, or manufactured products. As part of the bid or proposal, the contractor is required to certify that the materials provided either comply or do not comply with Buy America requirements. If a bidder or offeror certiÏies that it does not comply with the Buy America requirements, then the grantee must request, receive, and retain a waiver from FTA before it may award a contract to that bidder or offeror. Pre-Award Review Before the contract is awarded, the grantee must review information on Buy America compliance submitted by the manufacturer, including proposed domestic content of vehicle components (to determine that the 60 percent United States content requirement Module 2.11: Buy America and Vehicle Requirements LEVEL II - PAGE II-152
is met), the proposed Ïinal assembly location, and manufacturing activities that will take place during Ïinal assembly. In the case of a new bus, Ïinal assembly would typically include, at a minimum, the installation and interconnection of the engine, transmission, axles, including the cooling and braking systems; the installation and interconnection of the heating and air conditioning equipment; the installation of pneumatic and electrical systems, door systems, passenger seats, passenger grab rails, destination signs, wheelchair lifts; and road testing, Ïinal inspection, repairs and preparation of the vehicles for delivery. On-Site InspecÆ on The grantee is required to have an on-site inspector to conduct inspections during and after manufacturing for bus procurements, excluding those that are: ⢠10 or fewer vehicles serving large urbanized areas ⢠20 or fewer vehicles serving rural and small urbanized areas (200,000 people or fewer) ⢠UnmodiÏied vans Post-Delivery Review Following delivery of each vehicle, the grantee is required to review actual component content to ensure that the vehicle meets the 60 percent Buy America domestic content requirement, check that the Ïinal assembly location is in the United States and the manufacturerâs Ïinal assembly activities meet the requirements outlined in the March 18, 1997 âDear Colleagueâ letter and in 49 CFR 661. AddiÆ onal Requirements Specifi c to Vehicle Procurements In addition to the pre-award and post-delivery audit requirements under Buy America for purchases above $100,000, two other sets of certiÏications are required for FTA-funded vehicle purchases at any dollar value, even those under $100,000. Module 2.11: Buy America and Vehicle Requirements LEVEL II - PAGE II-153
CerÆ fi caÆ on of Compliance with Federal Motor Vehicle Safety Standards (FMVSS) When purchasing motor vehicles, 49 CFR 663.41 requires that the grantee: ⢠Obtain, at both the pre-award and post-delivery stages, certiÏication from the manufacturer that the vehicle complies with relevant FMVSS (49 CFR Part 571). ⢠Complete, at the post-delivery stage, a certiÏication that the grantee has received from the vehicle manufacturer at both the pre-award and post-delivery stages a certiÏication that the vehicles comply with the FMVSS issued by the National Highway TrafÏic Safety Administration (49 CFR Part 571). The requirement to conduct an audit for compliance with FMVSS and sign a certiÏication applies to all purchases of revenue rolling stock, even those under $100,000. Purchaserâs Requirements The grantee must complete a pre-award purchaserâs requirements certiÏication verifying that the manufacturerâs bid speciÏications comply with the granteeâs solicitation requirements and that the proposed manufacturer is responsible and capable of building the bus to the solicitation speciÏications. The pre-award certiÏication may be based on the granteeâs determination that the vendor is responsive and responsible. Bus TesÆ ng Requirements Under 49 CFR Part 665, âBus Testing,â as part of each application to FTA for the purchase or lease of any new bus model, or any bus model with a major change in conÏiguration or components, the recipient must certify that the bus was tested at the FTA bus testing facility. Prior to Ïinal acceptance of the Ïirst vehicle manufactured in a procurement, the FTA grantee must obtain a copy of the test report under the FTA Bus Testing Program. Module 2.11: Buy America and Vehicle Requirements LEVEL II - PAGE II-154
A recipient of FTA capital assistance is responsible for: ⢠Determining whether a vehicle it plans to acquire is subject to the requirements of Part 665, and if it is, how to achieve compliance with those requirements. ⢠Certifying to FTA that any new bus model acquired with Ïinancial assistance from FTA has been tested in accordance with the requirements of Part 665. ⢠Certifying that it has received a copy of the applicable Bus Testing Report(s) before expenditure of any FTA funding on a bus. MAP-21 amended the bus testing provisions under 49 U.S.C. 5318 to require that FTA establish a pass/fall testing standard. FTA funds will be available to acquire a new bus model only if it has received a passing score. This requirement will take effect after FTA has issued regulations establishing the standard. A Ïinal rule on the new standards is due no later than two years after the passage of MAP-21. Disadvantaged Business Enterprise (DBE) CerÆ fi caÆ ons for Transit Vehicle Manufacturers (TVMs) All TVMs bidding on FTA-assisted procurements must comply with DBE requirements. The grantee must obtain DBE certiÏications from all the TVMs with bids submitted. For more information on DBE requirements, refer to the DBE module. Period of Performance (Contract Time Limits) Procurements of non-rail rolling stock and replacement part contracts are limited by law to Ïive years, including option years. SUPPLEMENTAL NOTES The American Public Transportation Association (APTA) developed the following materials speciÏic to bus procurement: ⢠Standard Bus Procurement Guidelines RFP (updated in May 2013, anticipated to go through the APTA adoption process in 2014). This template provides details for the procurement of transit buses at least 30 feet in length and contains language for Module 2.11: Buy America and Vehicle Requirements LEVEL II - PAGE II-155
FTA requirements that apply to vehicle procurements (including general requirements such as FTA contract clauses, not just vehicle-speciÏic requirements). http://www.apta.com/resources/standards/Documents/APTA%20Bus%20Procurement%20 Guidelines.pdf ⢠Recommended Practice: In-Plant Inspection for Bus Procurements (March 2011). http://www.apta.com/resources/standards/ Documents/APTA-BTS-II-RP-001-11.pdf TIPS ON RELATIONSHIPS TO OTHER MODULES Other procurement requirements are addressed in Introduction to Procurement, Procurement Policies, Process, and History, and DBE. LINKS/INFO ⢠FTA Buy America webpage. http://www.fta.dot.gov/legislation_law/12921.html ⢠FTA Online Handbook: Conducting Pre-Award and Post-Delivery Audits for Bus Procurements. http://www.fta.dot.gov/legislation_law/12921_5423.html ⢠FTA Guidance: âProcurements Following Rescission of the Buy America Waiver for Minivans.â http://www.fta.dot.gov/documents/2013-2-14_Minivan_Guidance.pdf ⢠APTA Standard Bus Procurement Guidelines RFP template. http://www.apta.com/resources/standards/Documents/APTA%20 Bus%20Procurement%20Guidelines.pdf ⢠NTI Bus Procurement Workshop: http://www.ntionline.com/courses/courseinfo.php?id=23 Module 2.11: Buy America and Vehicle Requirements LEVEL II - PAGE II-156
⢠FTAâs Best Practices Procurement Manual. http://www.fta.dot.gov/grants/13054_6037.html ⢠FTA Bus Testing web page. http://www.fta.dot.gov/bustesting ⢠Bus Test Reports. http://146.186.225.57/test-reports.htm QUIZ 1. Microcomputer equipment and software are waived from Buy America requirements. 1) True. 2) False. 2. Under Buy America, which of the following are required for bus procurements valued at $100,000? A) Buy America Clause and CertiÏication in the Procurement Solicitation B) Pre-Award Review C) On-Site Inspection D) Post-Delivery Review 1) A. 2) A & D. 3) All of the above. 4) None of the above. 3. A rural transit system is required to have an on-site inspector for procurements of 20 vehicles. 1) True. 2) False. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.11: Buy America and Vehicle Requirements LEVEL II - PAGE II-157
KEY CONCEPTS ⢠Introduction to FTA-Required State and Local Planning Activities and their Inter-Relationships ⢠MPO Planning ⢠Statewide and Nonmetropolitan Planning ⢠State and Regional Public Participation Methods ⢠State Program of Projects ⢠Transit Performance Evaluation INTRODUCTION Transportation planning plays a fundamental role in a state, region, or communityâs vision for its future. Effective transportation planning includes a comprehensive consideration of possible strategies, an evaluation process that encompasses diverse viewpoints, the collaborative participation of relevant transportation-related agencies and organizations, and open, timely, and meaningful public involvement. Maintaining, enhancing, and planning for a multi-modal transportation system involves numerous actors at the state, regional, metropolitan, and local levels. As the actors have varied resources, responsibilities, and priorities for the system, the federal government (i.e. FTA and FHWA) has an interest in encouraging coordination and consistency among transportation planning efforts. State DOTs and their subrecipients can draw on federal formula funding for planning through S. 5303 (Metropolitan Transportation Planning), S. 5304 (Statewide and Nonmetropolitan Transportation Planning) and S. 5305 (Planning Programs- Metropolitan Planning and State Planning and Research). These programs come with requirements to help ensure that the planning process is continuing, cooperative, and comprehensive across all levels. In urbanized areas, the transportation planning process is conducted by a Metropolitan Planning Organization (MPO), in cooperation with the state DOT and transit providers. In rural areas, transportation planning processes are carried out by the state, in cooperation with local ofÏicials in non-metropolitan areas and transit providers. FTA and FHWA jointly administer the federally required transportation planning processes in metropolitan areas, as set forth in 49 USC 5303 and 23 USC 134. In rural areas and on a statewide basis, the statutory provisions for transportation planning are set forth in 49 USC 5304 and 23 USC 135. This module presents general state and regional/metropolitan planning requirements that state transit staff should be familiar with. Locally-focused transit planning is addressed separately in the Local Planning module. Module 2.12: State and Metropolitan Planning LEVEL II - PAGE II-158
IMPORTANCE FOR STATE DOT STAFF State DOTs must coordinate the statewide planning process with the planning activities of their MPOs, as well as with local ofÏicials and regional organizations responsible for transportation in non-metropolitan areas. Likewise, they must ensure that MPOs carry out the metropolitan planning process in coordination with the statewide process and with âdue consideration of other related planning activities within the metropolitan area.â State DOTs are also responsible for statewide transit planning and for transit planning efforts in non-urbanized areas, i.e., development of the STIP. As designated recipients of planning funding under S. 5303, 5304, and 5305, states must fulÏill their planning responsibilities while simultaneously accounting for the activities and concerns of multiple interested parties. DEFINITIONS Fiscal Constraint: a demonstration of sufÏicient funds (federal, state, local, and private) to implement proposed transportation system improvements, as well as to operate and maintain the entire system. Long-Range Statewide Transportation Plan: the Stateâs ofÏicial, statewide, multimodal transportation plan covering a period of no less than 20 years, developed through the statewide transportation planning process. Metropolitan Planning Program (MPP): the federal Ïinancial assistance provided by FTA, under S. 5305, to support work activities necessary to conduct the federally required metropolitan transportation planning process. Metropolitan Planning Organization (MPO): a federally designated organization charged with carrying out the transportation planning process for an urbanized area with a population of 50,000 or more. Metropolitan Transportation Plan (MTP): the ofÏicial multimodal transportation plan addressing no less than a 20-year planning horizon that is developed, adopted, and updated by the MPO. Module 2.12: State and Metropolitan Planning LEVEL II - PAGE II-159
State Planning and Research Program (SPRP): the federal Ïinancial assistance provided by FTA under S. 5305 to support work activities necessary to conduct the federally required statewide transportation planning. Statewide Transportation Improvement Program (STIP): a statewide prioritized program of federally-funded transportation projects covering a period of four years that is consistent with the Long-Range Statewide Transportation Plan, MTPs, and Transportation Improvement Programs (TIPs), and required for projects to be eligible for funding. Transportation Improvement Program (TIP): a prioritized listing/program of transportation projects covering a period of at least four years that is developed and formally adopted by an MPO as part of the metropolitan transportation planning process, consistent with the MTP, and required for projects to be eligible for funding. UniÏied Planning Work Program (UPWP): a program of work produced by an MPO that identiÏies the planning priorities and activities to be carried out during the next one to two years. DETAILS ON FTA REQUIREMENTS IntroducÆ on to FTA-Required State and Local Planning AcÆ viÆ es and Their Inter-RelaÆ onships As a condition of receiving federal funds, state DOTs and their sub-recipients must conduct a continuing, comprehensive, and coordinated multi-modal transportation planning process in metropolitan areas and statewide (â3-Câ for short). Eight planning factors deÏine the scope of the process, required for consideration during the development of transportation plans and programs. The factors under MAP-21 (unchanged from SAFETEA-LU) are: 1) Support the economic vitality of the metropolitan area, especially by enabling global competitiveness, productivity, and efÏiciency; 2) Increase the safety of the transportation system for motorized and nonmotorized users; 3) Increase the security of the transportation system for motorized and nonmotorized users; Module 2.12: State and Metropolitan Planning LEVEL II - PAGE II-160
4) Increase the accessibility and mobility of people and for freight; 5) Protect and enhance the environment, promote energy conservation, improve the quality of life, and promote consistency between transportation improvements and state and local planned growth and economic development patterns; 6) Enhance the integration and connectivity of the transportation system, across and between modes, for people and freight; 7) Promote efÏicient system management and operation; and 8) Emphasize the preservation of the existing transportation system. The development of long-range plans and short-range programs of transportation investment priorities is a large part of the planning process. As noted above, FTA and FHWA jointly administer S. 5303, 5304, and 5305 to support planning activities. Under S. 5304, each state must carry out a 3-C statewide multimodal transportation planning process that addresses the eight planning factors, including the development of a long-range statewide transportation plan (LRSTP) and a statewide transportation improvement program (STIP). The state must develop and use a documented public involvement process that provides opportunities for public review and comment at key decision points. Under S. 5303, each MPO must do the same at the metropolitan level, including the development of a metropolitan transportation plan (MTP) and a transportation improvement program (TIP). As the term 3-C suggests, FTA-required planning activities are intended to be developed in consultation with and with consideration for other transportation plans and activities, including those at the local level. For example, the STIP corresponds to the projects included in the TIPs of the stateâs MPOs. In addition, the local coordinated public transit-human services plan should reÏlect metropolitan and statewide plans, and vice versa. MPO Planning See 49 USC 5303 (Metropolitan Transportation Planning) and 49 USC 5305 (Metropolitan Planning Program) for more details. First mandated by the Federal-Aid Highway Act of 1973, MPOs are federally designated organizations required in every urbanized area (UZA) with a population of 50,000 or more. MPOs are intended to be forums for metropolitan transportation decision making and investment, both for transit and other modes. Policy boards composed of local elected ofÏicials, public agencies, and state transportation ofÏicials head MPOs, and MPO staff and various advisory committees support the boards. Module 2.12: State and Metropolitan Planning LEVEL II - PAGE II-161
Key MPO planning functions include: ⢠Preparing a long-range transportation plan (LRTP), aka metropolitan transportation plan (MTP), aka constrained long-range transportation plan (CLRTP/CLRP) ⢠Preparing a complementary short-term transportation improvement program (TIP) ⢠Preparing a uniÏied planning work program (UPWP) ⢠Preparing and carrying out a public participation plan Another MPO responsibility deals with coordinating transportation and air quality planning in accordance with the Clean Air Act. If a metropolitan area is designated by the EPA as an air quality nonattainment area (not meeting federal air quality standards) or air quality maintenance area (currently meeting federal air quality standards but previously in violation), all transportation plans, programs, and projects must conform to the stateâs air quality plan, known as the State Implementation Plan (SIP). Only transportation projects that meet these air quality goals are eligible for federal funding. In addition to air quality, MPOs with populations greater than 200,000 are also responsible for congestion planning. MPOs that meet this threshold are designated as transportation management areas (TMAs) and must have a congestion management process (CMP) in place that identiÏies actions and strategies to reduce congestion and increase mobility (e.g. transportation demand management). Importantly, the LRTP/MTP and the TIP are Ïiscally-constrained, meaning that both must reÏlect available resources. According to 29 CFR Part 450, these plans âshall include a project, or an identiÏied phase of a project, only if full funding can reasonably be anticipated to be available for the project within the time period contemplated for completion of the project.â Elements of the LRTP/MTP include: 1. IdentiÏication of existing and proposed transportation facilities 2. Performance measures and targets 3. A system performance report 4. Consideration of potential environmental mitigation activities Module 2.12: State and Metropolitan Planning LEVEL II - PAGE II-162
5. A Ïinancial plan for implementation 6. Operational and management strategies 7. Capital investment and other strategies 8. Consideration of the CMP (for TMAs) 9. Scenario development (optional) The TIP is a management tool for monitoring progress in implementing the LRTP/MTP. It identiÏies funding sources and timing for speciÏic projects, and only projects proposed in the TIP are eligible to receive federal funds. The Ïirst year of the TIP constitutes an ââagreed toââ list of projects for selection purposes. For each project or project phase, the TIP must include: 1. A project description 2. An estimated total project cost 3. An amount of federal funds proposed to be obligated for each year 4. The responsible agencies 5. Performance target achievement (i.e. linking the project to the targets) Metropolitan Planning Program funds under S. 5305 are available for MPOs to carry out the planning process and develop the required plans. However, the MPO is a subrecipient of the state for this assistance. As the designated recipient, the state submits a single grant application to the FTA on behalf of its MPOs and then allocates the funding based on an FTA-approved formula. Metropolitan Planning Program funds are based on the activities described in the UPWP. The Census Bureauâs designation of UZAs occurs with every decennial Census and has signiÏicant implications for MPO planning. As a result of the 2010 Census, 36 new urbanized areas were identiÏied (above the 384 existing MPOs). These areas are either establishing and stafÏing a new MPO, or merging with an existing MPO. A total of 27 new TMAs were designated (above the 155 existing) as a result of increases in population or because of splits or mergers of urbanized areas within existing metropolitan planning area boundaries. Module 2.12: State and Metropolitan Planning LEVEL II - PAGE II-163
Statewide and Nonmetropolitan Planning See 49 USC 5304 (Statewide and Nonmetropolitan Transportation Planning) and 49 USC 5305 (State Planning and Research Program) for more details. States are the designated recipients and only entities eligible to apply for and receive S. 5305 (Metropolitan Planning Program and State Planning and Research Program) funds directly from FTA. State DOTs can use these funds to carry out statewide transportation planning and to develop the LRSTP and the STIP, documents comparable to the LRTP and the TIP at the metropolitan level. Key state DOT planning functions include: ⢠Preparing a long-range statewide transportation plan (LRSTP) ⢠Preparing a statewide transportation improvement program (STIP) ⢠Preparing and carrying out a public participation plan The LRTSP must be developed in cooperation with the stateâs MPOs, and in consultation with non-metropolitan ofÏicials and any tribal governments. Elements of the LRTSP include: 1. Strategies, investments, procedures, and other measures for the preservation and use of the existing system 2. Reference to applicable short-range plans and studies 3. A discussion of potential environmental mitigation activities 4. A Ïinancial plan for implementation (optional) 5. Performance measures and targets, and a system performance report For short-range planning, the STIP identiÏies funding sources and timing for speciÏic projects. Again, like the TIP, the STIP is Ïiscally constrained. At least every four years, states must submit an updated STIP to FTA and FHWA for joint approval. Only projects in a FHWA/FTA approved STIP are eligible for federal funding. Module 2.12: State and Metropolitan Planning LEVEL II - PAGE II-164
The STIP must include the following for each project or project phase: 1. A project description 2. An estimated total project cost 3. An amount of federal funds proposed to be obligated for each year 4. The responsible agencies 5. Performance target achievement (i.e. linking the project to the targets) Key Statewide and Regional Planning Documents Who Develops? Who Approves? Time Horizon Content Update Requirements UPWP MPO MPO 1 or 2 yrs Planning studies and tasks Every 1-2 yrs LRTP/MTP MPO MPO 20 yrs Future goals, strategies, and projects Every 5 yrs, every 4 for non- aÆ© ainment/maintenance areas TIP MPO MPO and State DOT 4 yrs TransportaÆ on investments Every 4 yrs (may be amended several Æ mes per yr) LRSTP State DOT State DOT 20 yrs Future goals, strategies, and projects Not specifi ed STIP State DOT State DOT and US DOT (FTA/FHWA) 4 yrs TransportaÆ on investments Every 4 yrs (may be amended several Æ mes per yr) Source: The TransportaÆ on Planning Process: Key Issues. September 2007. hÆ© p://www.planning.dot.gov/documents/briefi ngbook/bbook.htm Module 2.12: State and Metropolitan Planning LEVEL II - PAGE II-165
State and Regional Public ParÆ cipaÆ on Methods Transportation planning is a cooperative process designed to foster involvement by all users of the system, such as businesses, community groups, environmental organizations, the traveling public, freight operators, and the general public, through a proactive public participation process. Both the state and its MPOs have responsibilities regarding public participation while carrying out statewide and metropolitan planning processes (see 23 CFR 450.210 and 450.316 for more details). Both must document and use a public involvement plan that details strategies for engaging the public and responding to input. The plan should allow for participation by interested parties: citizens; public agencies; freight transportation providers; private transportation providers; and representatives of public transportation employees, public transit users, pedestrians, bicyclists, and individuals with disabilities. An example of participation includes providing the public with reasonable opportunities to review and comment on proposed plans (the LRTP/MTP, TIP, LRSTP, STIP, etc.). At a minimum, the state and MPO public involvement process must: ⢠Establish early and continuous public involvement opportunities ⢠Provide reasonable public access to technical and policy information ⢠Provide adequate public notice of public involvement activities and time for public review and comment at key decision points S. 5305 MetropolitanPlanning Program;StatePlanningand ResearchProgram S. 5303 MetropolitanPlanning MTP/LRTP/CLRP 20yrhorizon,fiscally constrained TIP 4yrhorizon,fiscally constrained,consistentwith MTP,incorporatedintoSTIP UPWP 2yrhorizon Public Participation Plan S. 5304 Statewideand NonmetropolitanPlanning LRSTP 20yrhorizon STIP 4yrhorizon,fiscally constrained,consistentwith LRSTP,includesMPOTIPs Public Participation Plan FTA-Required Planning for States and MPOs at a Glance Module 2.12: State and Metropolitan Planning LEVEL II - PAGE II-166
⢠Hold public meetings at convenient and accessible locations and times ⢠Employ visualization techniques to describe proposed plans ⢠Make public information available in electronically accessible formats and means ⢠Demonstrate explicit consideration and response to public input during plan development ⢠Include a process for seeking out and considering the needs of those traditionally underserved by existing transportation systems, such as low- income and minority households ⢠Periodically review the effectiveness of the public involvement process to ensure that it provides full and open access to all interested parties, revising as appropriate The state and the MPO must also consult interested parties when developing or revising the plan itself, allowing at least a 45 day review and comment period before adopting major changes to public involvement procedures. Subrecipients also have public participation requirements that are addressed in the Public Participation and Local Planning modules. State Program of Projects Each state develops a Program of Projects (POP) as part of its annual application to FTA. Projects within the POP must be consistent with the STIP as well as the TIP for metropolitan areas in which proposed projects are located. The state develops its annual POP based on the subrecipient grant applications and locally developed public transit-human services transportation plans. For more information on state POPs, see the FTA Grant Administration module. Transit Performance EvaluaÆ on MAP-21 legislation places new emphasis on âa performance-driven, outcome-based approachâ to both metropolitan and statewide planning, as described in Sections 5303 and 5304. The states and MPOs must establish performance targets to use in tracking progress towards the attainment of critical outcomes, integrating other performance-based plans (e.g. plans developed by subrecipients) into the planning process. The performance measures themselves have yet to be established; MAP-21 mandates that U.S. DOT establish these no later than Oct. 1, 2013. Module 2.12: State and Metropolitan Planning LEVEL II - PAGE II-167
Performance targets must be included in FTA-required plans (the LRTP/MTP, TIP, LRSTP, and STIP), and should: 1. Be coordinated with the state (for MPOs) or MPOs (for the state). 2. Be coordinated with public transportation providers. 3. Be consistent with performance targets related to transit asset management (49 US 5326) and transit safety (49 USC 5329). TIPS ON RELATIONSHIPS TO OTHER MODULES Locally-focused transit planning is addressed separately in the Local Planning module. The Public Participation module also addresses planning concepts. LINKS/INFO ⢠FTA Circular 8100.1C, Program Guidance for Metropolitan Planning and State Planning and Research Program Grants. September 1, 2008. http://www.fta.dot.gov/legislation_law/12349.html. ⢠Federal Register, Vol. 72, No. 30. February 14, 2007. âStatewide Transportation Planning; Metropolitan Transportation Planning.â ⢠The Transportation Planning Process: Key Issues. A BrieÏing Book for Transportation Decisionmakers, OfÏicials, and Staff. September 2007. http://www.planning.dot.gov/documents/brieÏingbook/bbook.htm ⢠USDOT Metropolitan Planning Organization (MPO) Database. http://www.planning.dot.gov/mpo.asp. ⢠NTI Planning courses. http://ntionline.com/courses/list.php?program_id=4 Module 2.12: State and Metropolitan Planning LEVEL II - PAGE II-168
QUIZ 1. MPOs are required in urbanized areas with populations of 50,000 or more. 1) True. 2) False. 2. The metropolitan transportation plan (MTP): A. Is Ïiscally-constrained B. Includes estimated costs and funding sources for speciÏic projects C. Includes overall performance measures and targets 1) A. & B. 2) A. & C. 3) All of the above. 2. Key state DOT planning functions include: A. Preparing a LRSTP and a STIP B. Preparing a UPWP C. Preparing and carrying out a public participation plan 1) A. & B. 2) A. & C. 3) All of the above. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.12: State and Metropolitan Planning LEVEL II - PAGE II-169
KEY CONCEPTS ⢠Subrecipient Applications/Local POPs ⢠Relationship of Local Application/Local POP to STIP/TIP ⢠Specialized Transportation Coordination ⢠Transit Services Planning ⢠Transit Performance Evaluation ⢠City/County/Regional Planning ⢠Land Use Planning ⢠Planning Requirements for ITS Projects INTRODUCTION Planning can mean different things at different levels of the funding and organizational hierarchy, such as: ⢠Broad-brush multi-year projections of funding needs. ⢠Selecting the optimum location for a new transit center. ⢠Estimating when older vehicles in a transit systemâs Ïleet will need to be replaced. ⢠Determining what routing would most efÏiciently and effectively serve a neighborhood, and the bus stops and timepoints at which a bus will stop along the route. ⢠Designing how multiple modes should connect to maximize the travel options for riders. ⢠Determining the optimum fare to charge for service. State transit staff should be familiar with a broad range of planning requirements and concepts, speciÏically those that pertain to subrecipients. Some of FTAâs planning requirements are embedded in topic areas (such as ADA and Title VI) and discussed in other modules of this curriculum. Many planning requirements have a public involvement component; these are summarized in the Public Participation module. Projects selected for funding under the S. 5310 program are subject to coordination planning requirements; the projects must be included in a locally developed, coordinated public transit- human services transportation plan. States and metropolitan areas have statewide and regional planning requirements that are addressed in the State and Metropolitan Planning module. Intelligent Transportation Systems (ITS) projects are also subject to special planning requirements that are described in this module. IMPORTANCE FOR STATE DOT STAFF States are responsible for ensuring that projects selected for S. 5310 funding are included in a locally developed, coordinated public transit-human services Module 2.13: Local Planning LEVEL II - PAGE II-170
transportation plan. State transit staff should be familiar with basic transit service planning and evaluation concepts, to enable them to provide guidance to their subrecipients in planning local services, as well as to evaluate subrecipient services and systems using any state-established performance standards. State transit staff should also be aware of local planning activities, such as county and land use plans, and encourage their subrecipients to be engaged in these activities. States are also responsible for ensuring that FTA-funded ITS projects conform to the National ITS Architecture, as well as to U.S. DOT- adopted ITS Standards, and that they are part of a locally approved Regional ITS Architecture. DEFINITIONS Metropolitan Planning Organization (MPO): a federally designated organization charged with carrying out the transportation planning process for an urbanized area with a population of 50,000 or more. Program of Projects (POP): A list of projects to be funded in a grant application submitted to FTA by a state or designated recipient. The POP lists the subrecipients and indicates what type of organization they are, a brief description of each project, total project cost, and federal share for each project. Statewide Transportation Improvement Program (STIP): a statewide prioritized program of federally-funded transportation projects covering a period of four years that is consistent with the Long-Range Statewide Transportation Plan, Metropolitan Transportation Plan, and Transportation Improvement Programs (TIPs), and required for projects to be eligible for funding. Transportation Improvement Program (TIP): A prioritized listing/program of transportation projects covering a period of at least four years that is developed and formally adopted by an MPO as part of the metropolitan transportation planning process, consistent with the Metropolitan Transportation Plan, and required for projects to be eligible for funding Module 2.13: Local Planning LEVEL II - PAGE II-171
DETAILS ON FTA REQUIREMENTS Subrecipient ApplicaÆ ons/Local POPs As noted in the State and Metropolitan Planning module, the state develops its annual POP based on the subrecipient grant applications (as well as the locally developed public transit-human services transportation plans). As part of the grant application, states generally require subrecipients to apply for funding for speciÏic projectsâessentially to develop a local POP, although in your state it may be referred to by another name. Refer to your stateâs local grant application packages and State Management Plan(s) for more information. Section 5307 recipients (including direct small urban recipients) are required to develop their own POP. The development of the POP must meet FTA public participation requirements described in the FTA Grant Administration module. RelaÆ onship of Local ApplicaÆ on/Local POP to STIP/TIP As is the case with the stateâs POP, to be eligible for FTA funding, local POPs/project applications must be included in the STIP, and, if located with a metropolitan area, the MPOâs TIP. Inclusion in the STIP As noted in the State and Metropolitan Planning module, at least every four years, each state submits a STIP for federal transportation funds. Local subrecipients can assist the state in planning for adequate funding for local transit by realistically projecting capital replacement needs on a Ïive-year planning horizon. For this reason, your state may have capital planning requirements for your subrecipients that extend beyond the current yearâs application. Refer to your stateâs local grant application packages and State Management Plan(s) for more information. Module 2.13: Local Planning LEVEL II - PAGE II-172
Inclusion in the TIP Where local projects exist or are being proposed within an MPOâs current planning/study area boundaries (which may include areas that are currently nonurbanized, but are expected to become urbanized within the next 20 years), the local projects must be included in the MPOâs TIP. Local transit systems should be involved in the annual development of the TIP and need to plan for several years in advance, as the TIP has a six-year planning horizon, and amending the TIP involves a formal process. Each state takes care of submitting an annual POP incorporating the projects of its subrecipient for all of the applicable TIPs. Specialized TransportaÆ on CoordinaÆ on Under SAFETEA-LU, funding through S. 5310, 5316, and 5317 required that projects be derived from a locally developed, coordinated public transit-human services transportation plan. This coordinated planning requirement was designed to be a participatory process including public, private, and human service transportation providers. Under MAP-21, this requirement continues to apply to S. 5310. States must ensure that their subrecipients are involved in the coordinated planning process. Importantly, the coordinated public transit-human services plan must reÏlect metropolitan and statewide plans, and vice versa. FTA encourages S. 5307 recipients to ensure that projects meet the employment-related transportation needs of welfare recipients and low income individuals, either by deriving such projects from a locally coordinated public transit-human services planning process that involves low-income communities and their stakeholders, or by an alternative process that engages low income community stakeholders in the identiÏication and development of the project. In MAP-21, as in previous authorizing legislation, S. 5311 calls for âmaximum feasible coordination of public transportation service assisted under this section with transportation service assisted by other Federal sources.â Each state must certify compliance with this requirement. FTA has provided guidance and examples of best practices for coordination through the United We Ride program, but each state determines its own evaluation criteria for local subrecipients and what constitutes âmaximum feasible coordination.â At the time this curriculum was developed, FTA had not yet released its MAP-21-updated, proposed S. 5311 circular. The 2007 circular indicated that FTA expects public transit systems funded under both the S. 5307 and S. 5311 formula programs to participate in the local planning process for coordinated public transit-human service transportation in those areas applying for funds under S. 5310, 5316, or 5317. Module 2.13: Local Planning LEVEL II - PAGE II-173
Transit Services Planning Transit service planning by individual transit providers often occurs as a result of state DOT requirements. With input from a board of directors and/or a transportation advisory committee, local systems or regional entities develop speciÏic short-term transit plans, sometimes referred to as a transportation development plan (TDP). A TDP is typically prepared with a 4- to 6-year planning horizon. The process may include a review of system goals and objectives, documentation of existing services and performance, assessment of unmet needs and other issues, recommendations for service alternatives and improvements, an implementation timeline, and a Ïinancial and capital plan. FTA requirements that relate to transit planning are addressed in other modules including Public Participation, Title VI, and ADA. FTA has funded development of numerous technical assistance resources related to transit services planning through the Transit Cooperative Research Program (TCRP), as well as courses available through the National Transit Institute (including a 3-day âIntroduction to Transit Service Planningâ course). Local transit services planning is important from the perspective of the state because it provides a basis from which to project funding needs, not only in terms of paying for transit operations, but also paying for vehicles and facilities. When vehicles age, they need to be replaced. When new services are added, additional vehicles are needed to operate them. When services substantially change (such as switching from demand-responsive to Ïixed route service), the vehicle Ïleet is likely to change, making vehicle replacement planning more complicated. When new Ïixed route service is implemented, it must also comply with federal nondiscrimination requirements (ADA, Title VI). When planning major service reductions or fare increases, public notiÏication and an opportunity for public comment is required. If FTA funding is to be used to build a new transit facility, there are planning requirements related to selecting the location and designing the layout and surrounding infrastructure to minimize negative socioeconomic and environmental impacts. It is also helpful for state transit staff to have a basic understanding of service design and transit modes, as discussed in the Introduction to FTA Grants module. TCRP resources that can provide a deeper understanding of modes typically funded by S. 5311 are listed at the end of this module. Many states also require that S. 5311 funding be consistent with the locally developed, coordinated public transit-human services Module 2.13: Local Planning LEVEL II - PAGE II-174
transportation plan. Transit Performance EvaluaÆ on As noted in the State and Metropolitan Planning module, MAP-21 legislation requires that states and MPOs establish performance targets to use in tracking progress towards the attainment of critical outcomes, integrating other performance-based plans (e.g., plans developed by subrecipients) into their planning processes, based on performance measures to be established by U.S. DOT. While not an FTA requirement at this point, many states have established standard performance measures for their subrecipients, for use in evaluating the efÏiciency, effectiveness, safety, and/or quality of service, at the system level as well as for speciÏic routes or demand-response services within a system. Performance data are commonly used by state transit managers to monitor and oversee how effectively federal and state transit dollars are being spent. Performance measures are also important tools for use in service planning. Commonly-used performance measurements for rural and small urban transit services include: ⢠Passenger trips per vehicle revenue hour - indicates productivity ⢠Operating cost per vehicle revenue hour - indicates cost efÏiciency ⢠Operating cost per vehicle revenue mile - indicates cost efÏiciency ⢠Operating cost per passenger trip - indicates cost efÏiciency ⢠Safety incidents per 100,000 vehicle-miles - indicates safety ⢠Farebox recovery ratio (annual fare revenues collected as a percentage of total annual operating expenses) - indicates ability of service to recover costs All of these measures can be calculated using data collected for the Rural National Transit Database. Some states require data to be collected and reported for each route in a subrecipientâs system, and some states establish ranges of what is considered good, acceptable, or potentially problematic service. These ranges can be useful for identifying which services may need Ïine-tuning and for justifying or prioritizing funding. Module 2.13: Local Planning LEVEL II - PAGE II-175
There are a several excellent resources listed at the end of this module for learning more about calculating performance measurements and how to interpret the measures. City/County/Regional Planning Planning at the city and county level involves local elected ofÏicials and local government staff. These actors conduct land use and transportation planning activities parallel to state and metropolitan planning processes, often to fulÏill state requirements. Though the plans are primarily jurisdiction-speciÏic, they serve as important reference points for broader efforts. For example, MPOs must develop their Metropolitan Transportation Plans and TIPs with due consideration for other related planning activities within their metropolitan areas. The FTA also encourages MPOs to consult with and coordinate the planning process with area ofÏicials responsible for other types of planning activities (land use, economic development, environmental protection, airport operations, and freight movements). Likewise, states must develop their Longe-Range Statewide Transportation Plans and STIPS in consultation with nonmetropolitan local ofÏicials. States may also establish a regional planning structure to fulÏill planning functions in nonmetropolitan areas, for example through regional planning organizations or planning district commissions. MAP-21 speciÏically addresses regional planning in S. 5304; states may now establish and designate regional transportation planning organizations to support and enhance the statewide planning process. Regional transportation planning organization duties include developing regional plans and programs, providing technical assistance to local ofÏicials, ensuring regional and local input from nonmetropolitan areas, and providing a forum for public participation. Land Use Planning Transportation and land use are closely linked: development inÏluences regional travel patterns, while the transportation system inÏluences new development and land use. The metropolitan and statewide transportation planning process should account for this reciprocal relationship, considering current and projected population growth, future residential and commercial development, employment trends, and economic activity. Module 2.13: Local Planning LEVEL II - PAGE II-176
Section 5303, 20005(b) of MAP-21 highlights the land use-transportation link with a Transit-Oriented Development Planning (TOD) Pilot program. TOD is compact, mixed-use, pedestrian friendly development near transit facilities. The Pilot program provides funding for comprehensive planning associated with new Ïixed guideway and core capacity improvement projects. Planning Requirements for ITS Projects Intelligent Transportation Systems (ITS) projects are subject to special planning requirements. ITS refers to âthe integrated application of advanced computer, electronics, and communications technologies to increase the safety and efÏiciency of surface transportation.â Transit communication technology interface is an example of an ITS project. ITS projects funded by FTA must conform to the National ITS Architecture, as well as to U.S. DOT-adopted ITS Standards. ITS projects and programs are also required to be a part of a locally approved Regional ITS Architecture. The ITS Architecture Policy provides Ïlexibility to local areas in determining what agencies or organizations take the lead in developing the Regional ITS Architecture. The policy requires that the Regional ITS Architecture must be part of the local planning process and be consistent with and be reÏlected in the STIP and the TIP of the regionâs MPO. To date, U.S. DOT has not adopted any ITS standards. Updated information on the U.S. DOT ITS Standards Program can be found at http://www.standards.its.dot.gov/. FTA encourages the appropriate use of standards that have been developed via industry consensus by a standards development organization (SDO). The SDOs include the American Public Transportation Association (APTA); all of U.S. DOTâs SDOs are listed online here: http://www.standards.its.dot.gov/About/ProgramPartners. Among the standards developed by APTA include Transit Communications Interface ProÏiles (TCIP), Control and Communications Security (development is currently under way), and Transit Operational Software (development is currently under way). Module 2.13: Local Planning LEVEL II - PAGE II-177
What is Regional ITS Architecture? As noted above, FTA-funded ITS projects and programs are also required to be a part of a locally approved Regional ITS Architecture. The Regional ITS Architecture is a tool that is used in transportation planning, programming, and project implementation for ITS. It is a framework for institutional agreement and technical integration for ITS projects and is the place to start when deÏining the basic scope of a project. Subrecipients of FTA funds are not likely to be the lead agency for the development of the Regional ITS Architecture. The lead agency may be the MPO or the state. However, the subrecipient needs to be an active participant in the Regional ITS Architecture development and maintenance if the subrecipient is implementing ITS projects. TIPS ON RELATIONSHIPS TO OTHER MODULES The State and Metropolitan Planning module addresses development of the TIP and STIP. FTA requirements that relate to transit service planning are addressed in the Public Participation, Title VI, and ADA modules. LINKS/INFO University of Wisconsin CTEDâs Fundamentals of Public Transit includes basic concepts of transit planning and operations and basic concepts of performance measurement and the importance of service benchmarks. http://www4.uwm.edu/sce/course.cfm?id=302 Transit service planning training and resources: NTIâs Introduction to Transit Service Planning course. http://www.ntionline.com/courses/courseinfo.php?id=223 Module 2.13: Local Planning LEVEL II - PAGE II-178
TCRP Resources (can be ordered or downloaded through www.tcrponline.org): ⢠TCRP Report 70: Guidebook for Change and Innovation at Rural and Small Urban Transit Systems ⢠TCRP Report 101: Toolkit for Rural Community Coordinated Transportation Services ⢠TCRP Report 116: Guidebook for Evaluating, Selecting, and Implementing Suburban Transit Services ⢠TCRP Report 140: A Guide for Planning and Operating Flexible Public Transportation Services ⢠TCRP Report 147: Toolkit for Estimating Demand for Rural Intercity Bus Services ⢠TCRP Report 161: Methods for Forecasting Demand and Quantifying Need for Rural Passenger Transportation: Final Workbook CoordinaÆ on resources: ⢠NTIâs Managing Community Mobility course. http://www.ntionline.com/courses/courseinfo.php?id=44 ⢠SURTC, NDSUâs Transit Coordination: Finding Coordination Partners and Breaking Down Barriers âTraining on Demandâ workshop. http://www.surtc.org/training/topics.php?id=5 TCRP/NCHRP Resources: ⢠TCRP Report 101: Toolkit for Rural Community Coordinated Transportation Services ⢠TCRP Report 105: Strategies to Increase Coordination of Transportation Services for the Transportation Disadvantaged ⢠NCHRP Research Results Digest 331: Preparing Coordinated Transportation Plans: A Guidebook for State Departments of Transportation Module 2.13: Local Planning LEVEL II - PAGE II-179
Resources on Transit Performance Measurement ⢠SURTC, NDSUâs Transit Dollars and Sense: Sound Fiscal Management Using Performance Measures âTraining on Demandâ workshop. http://www.surtc.org/training/topics.php?id=25 TCRP Resources - The following resources can be ordered or downloaded through www.tcrponline.org: ⢠TCRP Report 136: Guidebook for Rural Demand-Response Transportation: Measuring, Assessing, and Improving Performance ⢠TCRP Report 165: Transit Capacity and Quality of Service Manual, 3rd Edition ⢠TCRP Report 88: A Guidebook for Developing a Transit Performance-Measurement System ⢠TCRP Research Results Digest 56: A Summary of TCRP Report 88: A Guidebook for Developing a Transit Performance- Measurement System ⢠TCRP Report 6: Usersâ Manual for Assessing Service-Delivery Systems for Rural Passenger Transportation ITS Project Planning Resources: ⢠NTIâs Implementing Rural Transit Technology course. http://www.ntionline.com/courses/courseinfo.php?id=63 ⢠TCRP Report 76: Guidebook for Selecting Appropriate Technology Systems for Small Urban and Rural Public Transportation Operators. www.tcrponline.org Module 2.13: Local Planning LEVEL II - PAGE II-180
QUIZ 1. Coordinated planning requirements applied to S. 5310, 5316, and 5317 under SAFETEA-LU, and continue to apply to S. 5310 under MAP-21. 1) True. 2) False. 2. Farebox recovery ratio indicates the ability of a service to recover costs and is expressed as: A. Passenger trips per vehicle revenue hour B. Operating cost per passenger trip C. Fare revenue as a percentage of operating expenses 1) A. 2) B. 3) C. 3. ITS projects funded by FTA must conform to the National ITS Architecture but have the option of being part of a locally approved Regional ITS Architecture, 1) True. 2) False. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.13: Local Planning LEVEL II - PAGE II-181
KEY CONCEPTS ⢠Program of Projects Public Participation Requirements ⢠Public Participation in the Coordinated Public Transit-Human Services Transportation Planning Process ⢠Public Comment on Fare and Service Changes ⢠Title VI Public Participation Requirements ⢠Public Review and Comment for Capital Projects (Environmental Planning) INTRODUCTION Each applicant for a S. 5307 grant must publish and afford an opportunity for a public hearing on their Program of Projects (POP). To be eligible for funding, S. 5310 and 5311 projects must be included in the Statewide Transportation Improvement Program (STIP), as well as certain metropolitan area plans which involve public input. Section 5307 projects must also be included in applicable metropolitan area plans which can help meet the POP public notice requirements. Projects funded under S. 5310 must also be derived from a locally-developed coordinated public transit-human service transportation plan. States certify that these coordinated public transit-human services transportation plans were developed through a process that included representatives of public, private, and non-proÏit transportation and human services providers, and participation by members of the public. Section 5307 grantees are expected to have a written locally developed process for soliciting and considering public comment before raising a fare or carrying out a major transportation service reduction (this is in addition to the need for a major service change deÏinition required under Title VI). The content and considerations of Title VI, the Executive Order on Limited English ProÏiciency (LEP), and the DOT LEP Guidance must be integrated into each recipientâs established public participation plan or process. FTA grant applicants are also required to provide an adequate opportunity for public review and comment on a capital project, and, after providing notice, to hold a public hearing on the project if the project affects signiÏicant economic, social, or environmental interests. Module 2.14: Public Participation LEVEL II - PAGE II-182
Applicable regulations and guidance: ⢠49 USC Chapter 53, Federal Transit Laws ⢠FTA proposed Circular 9030.1D, âUrbanized Area Formula Program: Program Guidance and Application Instructionsâ ⢠FTA proposed Circular 9040.1G, âFormula Grants for Rural Areas: Program Guidance and Application Instructionsâ ⢠FTA proposed Circular 9070.1G, âEnhanced Mobility of Seniors and Individuals with Disabilities Program Guidance and Application Instructionsâ ⢠Executive Order 13166 ⢠DOT LEP Guidance ⢠FTA C 4702.1B, Ch. III, Section 8 IMPORTANCE FOR STATE DOT STAFF State DOTs are responsible for ensuring that the state and its subrecipients involve the public in a meaningful way as decisions are made on transit programs, services, and fares. States (and their MPOs) have responsibilities regarding public participation while carrying out statewide and metropolitan planning processes (as required under 23 CFR 450.210 and 450.316). States must document and use a public involvement plan that details strategies for engaging the public and responding to input. The requirements for the stateâs public involvement plan are described in the State and Regional Planning module. DETAILS ON FTA REQUIREMENTS Program of Projects (POP) Public ParÆ cipaÆ on Requirements SecÆ on 5307 and Other ApplicaÆ ons for Projects in Urbanized Areas Both federal planning regulations and S. 5307 require public participation for the POP in a S. 5307 application. The metropolitan Module 2.14: Public Participation LEVEL II - PAGE II-183
transportation planning process must include a proactive participation plan that provides complete information, timely public notice, reasonable public access to key decisions, and early and continuing involvement of the public in developing plans and Transportation Improvement Programs (TIPs). FTA-funded projects within a metropolitan area must be programmed in the TIP to be eligible for funding. Section 5307 grantees have speciÏic requirements for public participation related to the POP. (POP public participation requirements do not apply to funds Ïlexed into a S. 5307 grant.) FTA allows a grantee to rely on the locally adopted public participation requirements for the TIP in lieu of the process required in the development of the POP if the grantee has coordinated with the Metropolitan Planning Organization (MPO) and ensured that the public is aware that the TIP development process is being used to satisfy the POP public participation requirements. To comply with the latter requirement, the MPOâs public participation plan should state that the MPOâs public participation process satisÏies the granteeâs public participation process for the POP. The public notice for the TIP must have an explicit statement that notice of public involvement activities and time established for public review of/ comments on the TIP will satisfy the POP requirements. If the grantee relies on its own process to satisfy POP public participation requirements, it must: a. Develop a proposed POP in consultation with interested parties, including private transportation providers. The grantee may rely on the MPO to assist in this process. A transportation advisory committee of the MPO may be informed or used as a reviewer of the POP. Private providers should be involved throughout this process. b. Ensure that the proposed POP provides for the coordination of S. 5307 public transportation projects with transportation projects assisted with other federal sources. Coordination may occur at many levels, from simple information sharing to total consolidation of services. Participation in the public transit-human services planning process satisÏies this requirement. c. Make available to the public information concerning the amount of funds available under the S. 5307 program and the POP that the recipient proposes to undertake with such funds. d. Publish the proposed POP in sufÏicient detail and in such a manner as to afford affected citizens, private transportation Module 2.14: Public Participation LEVEL II - PAGE II-184
providers, and, as appropriate, local elected ofÏicials, reasonable and adequate opportunity to examine the proposed program and to submit comments on it and on the performance of the grantee. The public notice is published in the general circulation newspaper in the service area of the grantee and should indicate where citizens can examine the proposed program and budget in detail and submit comments on the proposed program and the performance of the grantee. If the service area includes a signiÏicant number of persons with limited English proÏiciency, the grantee should distribute the notice to these populations (see the Title VI module). e. Provide an opportunity for a public hearing to obtain the views of citizens on the proposed POP. Most grantees include in the public notice an announcement that the proposed POP is available for review and that, if requested, a public hearing will be held. Some local laws or grantee policies make the public hearing mandatory. f. Consider comments and views received, including those of private transportation providers, in preparing the Ïinal POP. g. Make the Ïinal POP available to the public. If the proposed POP is not amended, including a statement that the proposed program will be the Ïinal program, unless amended, satisÏies the requirements regarding the Ïinal POP. SecÆ on 5310 To be eligible for funding, S. 5310 projects in urbanized areas must be included in the Metropolitan Transportation Plan (MTP) prepared and approved by the MPO, the TIP approved jointly by the MPO and the governor, and the Statewide Transportation Improvement Program (STIP) developed by a state and jointly approved by FTA and the Federal Highway Administration (FHWA). Projects outside urbanized areas must be included in, or be consistent with the Statewide Long-Range Transportation Plan, as developed by the state, and must be included in the STIP. With limited exceptions, all federally-funded highway or transit projects must be included in the applicable plan and program documents according to state and local procedures. SecÆ on 5311 A state requesting S. 5311 assistance must comply with the planning requirements of 49 USC 5303 through 5305. Projects Module 2.14: Public Participation LEVEL II - PAGE II-185
proposed for S. 5311 funding must be a product of the statewide and non-metropolitan transportation planning process and/or the metropolitan planning process speciÏied in 23 CFR part 450 and 49 CFR part 613. States must include S. 5311 funds in the STIP. FTA does not require public participation for individual S. 5311 subrecipient operating grant applications, but some states require similar public notice as is required for S. 5307 POPs. Public ParÆ cipaÆ on in the Coordinated Public Transit-Human Services TransportaÆ on Planning Process States certify that locally developed, coordinated public transit-human services transportation plans (from which S. 5310 projects must be derivedâsee the Planning module for more information) are developed through a process that included representatives of public, private, and non-proÏit transportation and human services providers, and participation by members of the public. Note that the required participants include not only transportation providers but also providers of human services, and members of the public (e.g., individuals with disabilities, older adults, and individuals with low incomes) who can provide insights into local transportation needs. It is important that stakeholders be included in the development and implementation of the local coordinated public transit- human services transportation plan. A planning process in which stakeholders provide their opinions but have no assurance that those opinions will be considered in the outcome does not meet the requirement of âparticipation.â Explicit consideration and response should be provided to public input received during the development of the coordinated plan. Stakeholders should have reasonable opportunities to be actively involved in the decision-making process at key decision points, including, but not limited to, development of the proposed coordinated plan document. The S. 5310 circular suggests the following strategies to facilitate appropriate inclusion: a. Adequate Outreach to Allow for Participation, such as notices or Ïlyers in centers of community activity, newspaper or radio announcements, e-mail lists, website postings, and invitation letters to other government agencies, transportation providers, human services providers, and advocacy groups. Any public meetings regarding the plan should be held in a location and time where accessible transportation services can be made available and adequately advertised to the general public using techniques such as those listed above. Additionally, interpreters for individuals with hearing impairments and English as a second language and accessible formats (e.g., large print, Braille, electronic versions) should be provided as required by law. Module 2.14: Public Participation LEVEL II - PAGE II-186
b. Participants in the Metropolitan and Statewide Planning Processes. Metropolitan and statewide planning under 49 USC 5303 and 5304 require consultation with an expansive list of stakeholders. There is signiÏicant overlap between the lists of stakeholders identiÏied under those provisions (e.g. private transportation providers and representatives of individuals with disabilities) and the organizations that should be involved in preparation of the coordinated plan. c. Good Faith Efforts to Encourage Participation. Communities will have different types of participants depending on population and size of community, geographic location, and services provided at the local level. FTA expects that planning participants will have an active role in the development, adoption, and implementation of the plan. Participation may remain low even though a good faith effort is made by the lead agency to involve passengers, representatives of public, private, and non-proÏit transportation and human services providers, and others. The lead agency convening the coordinated planning process should document the efforts it utilized, such as those suggested above, to solicit involvement. To increase participation at the local level, state transit ofÏices are encouraged to work with partner agencies at the state level to provide information to their constituencies about the importance of human service transportation programs and the opportunities that building a coordinated system offers. Public Comment on Fare and Service Changes (S. 5307 only) Annually, S. 5307 grantees certify that they have a locally developed process to solicit and consider public comment prior to raising a fare or implementing a major reduction in public transportation service. Grantees are expected to have a written policy that describes the public comment process. The grantee is responsible for deÏining a major service reduction. This can be deÏined as a standard, such as elimination of a route or reduction of âXâ percent of service hours or miles. The policy should provide an opportunity for a public hearing or meeting for any fare increase or major service reduction. It should describe how such meetings will be conducted and how the results will be considered. A public meeting is not mandatory; however, an opportunity for a public meeting in order to solicit comment must be provided. Some grantees offer an opportunity for public comment for all fare and service changes. This meets the requirement. The state must ensure that S. 5307 subrecipients have a process for obtaining public comment for fare increases and major service reductions. Either the state or its subrecipients are expected to have a written policy that describes the public comment process. The Module 2.14: Public Participation LEVEL II - PAGE II-187
state must also ensure that subrecipients follow the process and consider public comment when they raise fares or implement major service reductions. Although FTA only requires this public comment process for S. 5307 recipients, some states apply this requirement to S. 5311 subrecipients as well. Title VI Public ParÆ cipaÆ on Requirements The content and considerations of Title VI, the Executive Order on LEP, and the DOT LEP Guidance must be integrated into each recipientâs established public participation plan or process. An agencyâs public participation strategy must offer early and continuous opportunities for the public to be involved in the identiÏication of social, economic, and environmental impacts of proposed transportation decisions. Grantees have wide latitude to determine how, when, and how often speciÏic public participation activities should take place, and which speciÏic measures are most appropriate. Grantees should make these determinations based on a demographic analysis of the population(s) affected, the type of plan, program, and/or service under consideration, and the resources available. Efforts to involve minority and LEP populations in public participation activities can include both comprehensive measures, such as placing public notices at all transit stations, stops, and vehicles, as well as targeted measures to address linguistic, institutional, cultural, economic, historical, or other barriers that may prevent minority and LEP persons from effectively participating in a recipientâs decision-making process. Some effective practices to promote inclusive public involvement include: ⢠Scheduling meetings at times and locations that are convenient and accessible for minority and LEP communities. ⢠Employing different meeting sizes and formats. ⢠Coordinating with community- and faith-based organizations, educational institutions, and other organizations to implement public engagement strategies that reach out speciÏically to members of affected minority and/or LEP communities. ⢠Considering radio, television, or newspaper ads on stations and in publications that serve LEP populations. Outreach to LEP populations could also include audio programming available on podcasts. Module 2.14: Public Participation LEVEL II - PAGE II-188
⢠Providing opportunities for public participation through means other than written communication, such as personal interviews or use of audio or video recording devices to capture oral comments. The state is responsible for ensuring that subrecipients comply with Title VI requirements. Additional requirements are detailed in the Title VI module. Public Review and Comment for Capital Projects (Environmental Planning) Title 49 USC 5323(b) requires FTA grant applicants to provide an adequate opportunity for public review and comment on a capital project, and, after providing notice, to hold a public hearing on the project if the project affects signiÏicant economic, social, or environmental interests. These requirements are also satisÏied through compliance with the NEPA requirements for a public scoping process, public review and comment on NEPA documents, and a public hearing on every draft environmental impact statement (EIS). FTA also requires a public hearing on environmental assessments (EAs) that have a high probability of being elevated to EISs, ensuring that the applicant has complied with the public hearing requirement to include in the environmental record for the project. Under 49 USC 5323(b), any application for a project that will âsubstantially affect a community or the public transportation service of a communityâ shall include a certiÏication to the effect that the applicant has: a. Provided an adequate opportunity for public review and comment on the project; b. After providing notice, held a public hearing on the project if the project affects signiÏicant economic, social or environmental interests; c. Considered the economic, social, and environmental effects of the project; and d. Found that the project is consistent with ofÏicial plans for developing the community. Notice of such public hearings must include a concise description of the proposed project and be published in a newspaper of general circulation in the geographic area the project will serve. Further, under 49 USC 5324(b), FTA must review the public comments and hearing transcript to ascertain that an adequate Module 2.14: Public Participation LEVEL II - PAGE II-189
opportunity to present views was given to all parties having a signiÏicant economic, social, or environmental interest in the project, and that FTA must make a written Ïinding to this effect. FTA notes the public hearing requirements of 49 USC 5323(b) are separate and apart from the requirements for public participation in statewide and metropolitan planning. All capital projects Ïinancially supported by FTA are subject to statewide transportation planning requirements and, in metropolitan areas, to metropolitan planning requirements. FTA and FHWA have codiÏied procedures for compliance with the statewide and metropolitan planning statutory mandatesâincluding the mandates for public participation in the development of long-range plans and TIPsâin the two agenciesâ joint planning regulations (see 23 CFR part 450 and 49 CFR part 613.) The practical effect of these statewide and metropolitan planning requirements is to provide the opportunity for the public to be informed about and comment on transportation investment decisions, regardless of whether projects will âsubstantiallyâ affect a particular community and its public transportation service. TIPS ON RELATIONSHIPS TO OTHER MODULES The following other modules also contain public participation requirements: Title IV, State and Regional Planning, and Local Planning. LINKS/INFO ⢠FTA circulars. http://www.fta.dot.gov/legislation_law/12349.html ⢠DOT Limited English ProÏiciency (LEP) Guidance. http://www.fta.dot.gov/documents/LEP_Handbook.doc ⢠Language Access Assessment and Planning Tool for Federally Conducted and Federally Assisted Programs (May 2011). http:// www.lep.gov/ ⢠Executive Order 13166: âImproving Access to Services for Persons with Limited English ProÏiciencyâ. http://www.fta.dot.gov/ documents/LEP_Executive_Order.doc Module 2.14: Public Participation LEVEL II - PAGE II-190
QUIZ 1. Section 5307 grantees that rely on their own processes to satisfy POP public participation requirements must hold a public hearing to obtain the views of citizens on the proposed POP. 1) True. 2) False. 2. Which of the following are examples of outreach strategies for participation in the coordinated public transit-human services transportation planning process? A. Posting notices or Ïlyers in community centers B. Holding public meetings on the coordinated plan at times when transportation services are available C. Providing interpreters/accessible formats as required by law 1) A. 2) B. 3) C. 4) All of the above. 3. FTA requires that S. 5307 and S. 5311 subrecipients have a process for obtaining public comment on fare increases and major service reductions. 1) True. 2) False. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.14: Public Participation LEVEL II - PAGE II-191
INTRODUCTION States and their subrecipients must maintain control over real property, facilities, and equipment and ensure that they are used in transit service. States and subrecipients must keep federally funded equipment and facilities in good operating condition. MAP- 21 established new requirements for transit asset management as well as new reporting requirements. FTA grantees and their subrecipients will be required to develop transit asset management plans, establish targets for related performance measures, and submit reports. The MAP-21 requirements related to planning and reporting have not yet been determined. This module addresses the requirements that are contained in the Asset Management section of the FY2012 State Management Review Workbook, supplemented with information available on MAP-21 asset management requirements as of June 25, 2013. Together, these sets of requirements are intended to ensure that FTA-funded assets are: ⢠used appropriately, ⢠under the control of the grantee, ⢠adequately maintained, ⢠replaced at the appropriate time, and ⢠adequately documented. Assets funded under S. 5307 and the former S. 5309 program have additional requirements, including vehicle inventory, spare ratio, and contingency Ïleet/planning. The statutes and regulations governing these requirements include: ⢠Federal Transit Laws, Title 49, USC, Chapter 53 ⢠49 USC Section 5326 / MAP-21 Section 20019 Key guidance: ⢠FTA C 5010.1D - Grant Management Requirements (Rev. 1, August 27, 2012) ⢠FTA Advanced Notice of Proposed Rulemaking, âThe National Public Transportation Safety Plan, the Public Transportation Module 2.15: Asset Management LEVEL II - PAGE II-192
Agency Safety Plan, and the Public Transportation Safety CertiÏication Training Program; Transit Asset Managementâ (10/3/13) ⢠FTA Draft Circular 9030.1D IMPORTANCE FOR STATE DOT STAFF States are responsible for monitoring the use of FTA-funded real property, facilities, and equipment. Assets that are not maintained in a state of good repair present potential risks, including safety, service unavailability, and high maintenance and repair costs. Systematically planning for asset replacement enables subrecipients and the state to proactively plan for funding capital replacements so as to be better able to maintain a systemwide state of good repair. DEFINITIONS Asset: physical or capital assets including equipment, rolling stock, infrastructure, and facilities for use in public transportation; owned or leased by a recipient or subrecipient of FTA Ïinancial assistance. Equipment: an article of nonexpendable, tangible personal property having a useful life of more than one year and an acquisition cost which equals or exceeds the lesser of the capitalization level established by the governmental unit for Ïinancial statement purposes, or $5,000. Equipment includes rolling stock and all other such property used in the provision of public transit service. Facilities: all or any portion of a building or structure including roads, walks, and parking lots. Federal Interest: the federally-funded portion of an assetâs value. For an asset that was purchased using 80% FTA funding and 20% local match funding, the federal interest would be 80% of the current fair market value of the asset (factoring in depreciation). Incidental use of property/equipment: limited non-transit use of transit real property or equipment. (FTA C 5010.1D deÏines it as âThe authorized use of real property and equipment acquired with FTA funds for purposes of transit service but which also has Module 2.15: Asset Management LEVEL II - PAGE II-193
limited non-transit use due to transit operating circumstances. Such use must be compatible with the approved purposes of the project and not interfere with intended public transportation uses of project assets.â) Preventive Maintenance: all maintenance costs related to vehicles and non-vehicles. SpeciÏically, all the activities, supplies, materials, labor, services, and associated costs required to preserve or extend the functionality and serviceability of the asset in a cost effective manner, up to and including the current state of the art for maintaining such an asset. Project Purposes: the use of an FTA-funded asset as described in the original grant application or as subsequently approved by FTA. Real Property: land, including afÏixed land improvements, structures, and appurtenances. It does not include movable machinery and equipment. Rolling Stock: transit vehicles. DeÏined in Buy America regulations (49 CFR Part 661.3 - see module on Procurement for more on Buy America) as transit vehicles such as buses, vans, cars, railcars, locomotives, trolley cars, and ferry boats, as well as vehicles used for support services. (Note that the inclusion of vehicles used for support services as rolling stock may be inconsistent with FTA C 5010.1D, which indicates that âlight duty vehicles such as vans, sedans, and pick-up trucks employed in administrative and maintenance purposes are considered equipmentâ rather than rolling stock.) Transit Asset Management Plan: deÏined in MAP-21 as a plan developed by a recipient of FTA funding that includes, at a minimum, capital asset inventories and condition assessments, decision support tools, and investment prioritization; the recipient certiÏies compliance with the rule issued under 49 USC Section 5326. A transit asset management plan allows for the estimation of capital investment needs over time. Transit Asset Management System: a strategic and systematic process of operating, maintaining, and improving public transportation capital assets effectively throughout the life cycle of such assets. Useful Life: the expected lifetime of project property, or the acceptable period of use in service. Useful life of revenue rolling stock begins on the date the vehicle is placed in revenue service and continues until it is removed from service. Module 2.15: Asset Management LEVEL II - PAGE II-194
KEY CONCEPTS State of Good Repair Generally speaking, the expression âstate of good repairâ refers to good, functional condition when describing a transit asset. Several years before MAP-21 was enacted, FTA became aware of a growing problem: the condition of the transit infrastructure in cities and communities across the nation has been deteriorating, which is a major challenge for providing safe and reliable transit services. In 2008, FTA began hosting a series of State of Good Repair roundtable discussions, to start and foster a dialogue for how to address this problem, with a goal to bring to nationâs transit systems to a state of good repair. MAP-21 established a new State of Good Repair program dedicated to repairing and upgrading the nationâs rail transit systems along with high-intensity motor bus systems that use high occupancy vehicle lanes, including bus rapid transit (BRT). MAP-21 also requires FTA to deÏine the term âstate of good repairâ to include âobjective standards for measuring the condition of capital assets of recipients, including equipment, rolling stock, infrastructure, and facilities.â Transit Asset Management Prior to MAP-21, the FTA State Management Review workbook used the term âasset managementâ to refer to how a grantee manages how its assets are used and maintained, and at what point they become eligible for FTA replacement funding. With MAP-21, FTA has also begun to use âtransit asset managementâ to describe a holistic approach to having a handle on what assets a grantee owns, what condition they are in, how well they are working, and when they should ideally be replaced. Transit asset management planning can be described as a strategic and systematic approach to managing transit physical assets. It focuses on business and engineering processes for resource allocation and utilization, with the objective of better decision making based upon quality information and well-deÏined objectives. Transit asset management is a way of being proactive in managing how and when to spend capital resources (e.g., anticipating when vehicles are likely to need replacing and planning in advance for their replacement), rather than reactive in waiting until things are at a crisis stage (e.g., waiting until vehicles are frequently breaking down before taking steps to replace them). Module 2.15: Asset Management LEVEL II - PAGE II-195
Transit asset management planning can be conducted a different levels of complexity/maturity. The most basic kind of a transit asset management plan is an inventory of assets with a condition assessment for each asset. If your state requires subrecipients to update their vehicle inventory on an annual basis with current odometer readings and some indication of current condition, this is a basic level of asset management. More sophisticated plans can include policies, level of service objectives or performance targets (such as number of miles between vehicle road calls) - for which FTA is identifying performance measures as required under MAP-21), risk assessment (what is the risk of having an asset become unusable? what assets are highest priority?), lifecycle cost/performance information (how can we minimize costs and risk over the long run through preventive maintenance and replacement? how can we do this within our budget constraints?). SaÆ sfactory ConÆ nuing Control Continuing control refers to a granteeâs control over the use of an FTA-funded asset. FTA requires that grantees maintain âsatisfactory continuing controlâ over FTA-funded vehicles, facilities, etc. even if they are being used (e.g., through a lease agreement) by another organization. States and subrecipients are responsible for maintaining control over their FTA-funded assets, and states are responsible for ensuring that this control is maintained, through various monitoring activities. Useful Life With the exception of land, each asset has a life expectancy (often referred to as âuseful lifeâ or âservice lifeâ) in years and sometimes in usage units (such as vehicle miles). An asset that has reached the end of its useful life is essentially worn out, and must be replaced or at least overhauled/refurbished. Assets are often made up of major components (such as the engine in a vehicle, or the roof of a building) that have their own life expectancies. Replacing these components can extend the life of the overall asset. To reach their full useful life expectancy, assets and their components generally require two kinds of maintenance: preventive maintenance and corrective maintenance. Preventive maintenance is conducted at regular intervals and includes such basic items as changing a vehicleâs engine oil every 3,000-5,000 miles, for example, as well as more in-depth services that may be needed only every 30,000 miles. Preventive maintenance is conducted to prevent a vehicle from failing to function. When a vehicle fails (or breaks down), corrective maintenance is needed to repair the vehicle. A good preventive maintenance program will minimize the corrective Module 2.15: Asset Management LEVEL II - PAGE II-196
maintenance needed as well as minimize the risk that a vehicle will become inoperable (resulting in a loss of service) and unsafe (potentially resulting in an accident). As an asset ages, even with a good preventive maintenance program in place, it is likely to need an increasing amount of corrective maintenance, simply because older components wear out. Therefore older assets likely to cost more money to keep in operating condition (i.e. a state of good repair) than younger assets. At some point, it becomes more cost-effective to replace the asset rather than continuing to repair it. There is no hard and fast rule to determine this point, but an asset that has reached its useful life expectancy has likely entered the state of needing frequent repairs. An asset that has not yet reached its useful life has what is referred to as residual life, or the number of years or service units remaining until the end of its useful life. Residual life is important to monitor so that a transit system or state which intends to request FTA funding for replacement can time its grant application so that the funds would become available in time to replace a vehicle at the end of its useful life. This is because there is signiÏicant time involved in 1) waiting for a grant to be awarded (see module on Grants and Financial Management), 2) going through the procurement process (see module on Procurement), and 3) building the asset once a vendor has been selected. For example, if the transit system is buying a transit bus, steps 2 and 3 can take up to 18 months. For this reason, the transit system should be thinking about submitting its application for a grant to buy a replacement bus when one of its current buses has only 2 years of residual life left. SUMMARY OF FTA REQUIREMENTS The FTA requirements in this module are organized into the following sections: real property, equipment, maintenance, and transit asset management planning and reporting requirements established by MAP-21. Real Property The state must ensure that its FTA funded real property and its subrecipientsâ FTA funded real property are used for project purposes, until the property is sold. In general, this means that the real property must be used for public transportation purposes. Module 2.15: Asset Management LEVEL II - PAGE II-197
Incidental Use FTA does, however allow limited incidental use of real property (and equipment) for non-transit uses that do not interfere with the intended public transportation uses or the granteeâs continuing control over the use of the property, or compromise safety. Examples of incidental use include the leasing of space in a station for a newspaper stand or coffee shop and the lease of air rights over transit facilities. While FTA is particularly interested in encouraging incidental use as a means of supplementing transit revenues, non-proÏit uses are also permitted under certain circumstances. FTA approval is required for incidental use of real property. Income received from the authorized incidental or joint development uses may be retained by the grantees (without returning the federal share) if the income is used for eligible transit capital and operating expenses. This income cannot be used as part of the local share of the grant from which it was derived. However, it may be used as part of the local share of another FTA grant. Changes in Use Grantees are required to notify FTA when property is removed from the service originally intended at grant approval and if property is put to additional or substitute uses. If FTA funded real property is no longer needed for any transit purpose, grantees are required to prepare or update an excess property inventory and utilization plan. The granteeâs plan should identify and explain the reason for excess property. FTA C 5010.1D describes that the inventory list should include such things as: property location, summary of any conditions on the title, original acquisition cost, the federal participation ratio, FTA grant number, appraised value and date, description of improvements, current use of the property, and anticipated or proposed disposition or action. The Common Rule (49 CFR Part 18), Master Agreement, and FTA C 5010.1D have requirements for removing assets from transit service. Grantees must request FTA instructions on proper procedure for disposition of real property. Depending on the approved method of disposition, the grantee may be required to reimburse FTA. Module 2.15: Asset Management LEVEL II - PAGE II-198
Equipment Management and Control Certain management standards apply to FTA-funded equipment, supplies, and rolling stock purchased with federal funds. The state can rely on its own laws and procedures for managing and disposing FTA-funded equipment, and it may use the same procedures for public bodies and private nonproÏit organizations. Your stateâs procedures should be summarized in the State Management Plans for S. 5310 and S. 5311 (as well as the former S. 5316 and S. 5317 until the equipment funded under these programs no longer has a federal interest). Examples of procedures used by states to maintain control over FTA-funded equipment operated by subrecipients include equipment inventories, annual vehicle use certiÏications, periodic reporting of vehicle use, retention of or liens on titles, disposition requirements, lease restrictions, productivity standards, site visits, and minimum insurance requirements. The state may adopt FTAâs procedures for equipment management that must be followed for equipment funded under S. 5307 or the former S. 5309. FTA rolling stock and equipment management procedures require that: ⢠SpeciÏic equipment records be maintained by the grantee. ⢠A physical inventory of equipment must be taken and the results reconciled with equipment records at least once every two years. Any differences must be investigated to determine the cause of the difference. ⢠A control system be developed to ensure adequate safeguards to prevent loss, damage, or theft of project property. Any loss, damage, or theft must be investigated and documented by the grantee. S. 5307/5309 grantees must keep records of FTA-funded equipment, including leased assets and assets used by subrecipients, that include the following required information: ⢠description ⢠I.D. number ⢠acquisition date ⢠cost ⢠federal percentage ⢠grant number ⢠location ⢠use and condition ⢠disposition action ⢠vested title ⢠useful life Module 2.15: Asset Management LEVEL II - PAGE II-199
Useful Life Standards States are responsible for establishing and implementing useful life standards for vehicles purchased with S. 5310, 5311, 5316, or 5317 assistance. States must follow useful life standards for vehicles purchased with assistance under the former S. 5309 program (which has been replaced by S. 5339) that meet or exceed FTA requirements. Most states have adopted FTAâs useful life standards for all vehicles, regardless of funding source. Many states have adopted stricter (longer) useful life standards for vehicles. The following table presents FTA useful life standards for vehicles and ferries. Vehicle FTA-Defi ned Useful Life 35â-40â heavy duty bus and articulated transit bus 12 years or 500,000 miles 30â heavy duty transit bus 10 years or 350,000 miles 30â medium duty transit bus 7 years or 200,000 miles 25â-35â light duty transit bus (body on chassis vehicle) 5 years or 150,000 miles Other vehicles (small buses, vans, sedans) 4 years or 100,000 miles Rail vehicle 25 years Fixed guideway steel-wheeled trolley 25 years Fixed guideway electric trolleybus 15 years Passenger ferry 25 years Other ferries without refurbishment 30 years Other ferries with refurbishment 60 years Note: A heavy duty transit bus is built as a bus whereas a medium duty bus is built on a truck chassis. Useful life of rolling stock begins on the date the vehicle is placed in revenue service and continues until it is removed from revenue service. The useful life in miles refers to total miles in revenue transit service; non-revenue miles do not count towards useful life. Minimum useful life for buses, vans, and trolleys is determined by years of service or accumulation of miles, whichever comes Ïirst. Module 2.15: Asset Management LEVEL II - PAGE II-200
Leasing FTA-Funded Assets FTA-funded assets may be leased to other entities, such as local public bodies or agencies, private nonproÏit organizations, or private for-proÏit operators, if the lessee operates the assets on behalf of the state or subrecipient and provides transportation as described in the grant application for the asset. FTA requires states to exercise control over FTA-funded assets leased by subrecipients to ensure that they are used for project purposes. How this control is exercised is determined by each state. Many states require subrecipients who are leasing FTA-funded assets to submit a copy of the lease to the state for review. Other states provide a standard lease that subrecipients are required to use. FTA has established speciÏic requirements for leases of S. 5310 vehicles. The state must agree in writing to the lease between the S. 5310 subrecipient and the lessee. The vehicle may be used for incidental purposes only after grant needs have been met. The state and subrecipients are responsible for ensuring that adequate control is exercised over use of the leased equipment. Either the state or the subrecipient must retain title to the vehicle. Grantees may lease FTA funded assets to private operators. Prior FTA concurrence is required for equipment leased on or after November 1, 2008. If the lease was described in the grant application, FTA approval of the grant constitutes approval of the lease. Prior FTA approval is not required when equipment is leased to a transit management contractor that operates the service on behalf of the grantee. When FTA funded property is leased to a private operator, including management contractors, the lease should contain the following provisions: ⢠A requirement for the lessee to operate the project property to serve the best interest and welfare of the grantee and the public. The terms and conditions for operation of service imposed by the grantee shall be evidenced in a service agreement. ⢠A requirement for the lessee to maintain project property at a high level of cleanliness, safety, and mechanical soundness under maintenance procedures outlined by the project sponsor. The project sponsor and/or FTA shall have the right to conduct periodic maintenance inspections for the purpose of conÏirming the existence, condition, and the proper maintenance of the project equipment. Module 2.15: Asset Management LEVEL II - PAGE II-201
⢠A cross reference to a service agreement. A default under the lease is a default under the service agreement and vice versa. ⢠A requirement that the leased property may not be subleased without grantee written approval and may not be otherwise encumbered without FTA written approval. Vehicle Fleet Size ConsideraÆ ons Assets funded under S. 5307 and the former S. 5309 program have additional requirements, including vehicle inventory, spare ratio, and contingency planning. ⢠Spare Ratio - Spare ratio is deÏined as the number of spare vehicles divided by the vehicles required for annual maximum service. Spare ratio is usually expressed as a percentage, e.g., 100 vehicles required and 20 spare vehicles is a 20 percent spare ratio. FTA circular 5010.1D advises that the number of spare buses in the active Ïleet for grantees operating 50 or more Ïixed- route revenue vehicles should not exceed 20 percent of the number of vehicles operated in maximum Ïixed-route service. The circular also notes that the basis for determining a reasonable spare bus ratio takes local circumstances into account. ⢠Contingency Fleet - FTA recognizes two types of vehiclesâactive and contingency. Revenue vehicles which have met their minimum normal service life requirements may be stockpiled in a contingency Ïleet, in preparation for emergencies. These vehicles are not included in the calculation of spare ratio, and must be properly stored, maintained, and documented in a contingency plan. Any rolling stock not supported by a contingency plan will be considered part of the active Ïleet. Maintenance The state is responsible for ensuring that subrecipients maintain FTA funded vehicles, facilities, and facility-related equipment in good operating order. Minimum Requirements for Maintaining Vehicles The state must develop maintenance requirements for FTA funded vehicles that are adequate to protect the federal interest and Module 2.15: Asset Management LEVEL II - PAGE II-202
to ensure that the equipment is maintained in good operating order. Generally, subrecipient agreements require equipment to be maintained in good operating order. Your stateâs requirements for vehicle maintenance should be documented in the State Management Plans, the subrecipient grant application packages, and/or other guidance provided to subrecipients. Many states require subrecipients to follow manufacturersâ suggested maintenance activities and schedules. Some states require applicants to document their maintenance procedures in the application and may evaluate the ability to maintain vehicles as part of the project selection process. Some states have developed maintenance procedures that they require subrecipients to follow or require the development of maintenance plans. Maintenance Plans for FaciliÆ es States or their subrecipients are required to develop written maintenance plans for FTA funded facilities and facility-related equipment. The plan should identify the goals and objectives of a maintenance program and establish the means by which such goals and objectives will be attained. Repairs under Warranty If a subrecipient has equipment under warranty, FTA requires that there be a system for identifying warranty claims, recording claims, and enforcing claims against the manufacturers. An aggressive warranty recovery program ensures that the cost of defects is borne properly by the equipment manufacturer and not the grantee and FTA. There should be clear procedures to identify warranty repairs, record the warranty claim, submit the claim to the manufacturer, and follow up on unpaid claims. Monitoring Subrecipients FTA does not prescribe a monitoring system or speciÏic monitoring activities to ensure that subrecipients maintain FTA funded vehicles, facilities, and facility-related equipment in good operating order. Each state is responsible for developing and implementing a monitoring system that provides adequate assurance that FTA funded equipment and facilities are properly maintained. Most states use a combination of mechanisms: periodic reporting, maintenance record review, visual inspections, and maintenance audits. Module 2.15: Asset Management LEVEL II - PAGE II-203
Transit Asset Management Planning and ReporÆ ng Requirements Established by MAP-21 MAP-21 established the following general transit asset management requirements for FTA grantees. The details of these requirements have not yet been determined. On October 3, 2013 (shortly before this module of the curriculum was drafted), FTA issued an Advanced Notice of Proposed Rulemaking (ANPRM), âThe National Public Transportation Safety Plan, the Public Transportation Agency Safety Plan, and the Public Transportation Safety CertiÏication Training Program; Transit Asset Management.â FTA posed questions to the industry and seeks comments on the ANPRM by January 2, 2014. In the interim, states and their subrecipients can begin to prepare for these requirements. ⢠Transit Asset Management Plans - All FTA grantees and their subrecipients will be required to develop transit capital asset management plans that include, at a minimum: -capital asset inventories and condition assessments -investment prioritization (i.e., the priority for replacing each asset, as well as for expanding the inventory). ⢠Performance Targets - Each FTA recipient will be required to establish local targets for certain performance measures (to be established by USDOT/FTA) and update these targets annually. These performance measures have yet to be determined; the MAP-21 legislation mandates that U.S. DOT establish these no later than Oct. 1, 2013. Once U.S. DOT establishes these measures, recipients will have 3 months to establish their own targets. -As part of the performance-based planning process (49 USC Sections 5303 and 5304), MPOs and states are required to coordinate. ⢠Designated recipients of FTA formula funding will be required to report annually on: the progress of the recipient during the Ïiscal year to which the report relates toward meeting established performance targets and the performance targets established by the recipient for the subsequent Ïiscal year. An FTA factsheet on transit asset management indicates that the report must include the condition of the system and any changes in condition since the last report. Module 2.15: Asset Management LEVEL II - PAGE II-204
SUPPLEMENTAL NOTES ⢠FTA has developed software to assist with transit asset management, known as Transit Economic Requirements Model Lite (âTERM Liteâ). TERM Lite is a PC-based computer application (based on MS Access) designed to estimate an agencyâs transit capital investment needs over an extended time horizon. The model estimates the total amount of annual capital expenditures required over a twenty-year period to maintain or improve the physical condition and performance of the agencyâs transit infrastructure. TERM Lite can be downloaded at http://www.fta.dot.gov/13248_13251.html. ⢠The APTA Standards Program State of Good Repair (SGR) working group is developing SGR standards for assessing condition of transit assets. ⢠NTI presented a series of webinars on preparing a transit asset management plan as a recommended business practice. Although these webinars did not reÏlect the yet-to-be-determined MAP-21 requirements, and were targeted at urbanized transit systems with the means to conduct life-cycle costing analysis, they provide helpful guidance developing such a plan. The webinars were recorded and can be streamed at http://ntionline.com/courses/list.php?program_id=11. As discussed in these webinars, a fully-developed transit asset management plan answers these questions: -What does the transit system own? -What condition is it in and how well does it perform? -What risks are associated with it? (If something is not replaced on time, what could happen?) -How long will it last? -How much will it cost to replace and what are its future Ïinancial requirements? The NTI webinars recommended the following steps to develop the transit asset management plan: 1. develop inventory 2. assess condition 3. determine residual life 4. determine life cycle and replacement costs Module 2.15: Asset Management LEVEL II - PAGE II-205
5. set quality of service targets - on-time performance, miles between road calls 6. assess risk of delaying replacement of each asset - what is the relative importance is each asset? 7. optimize maintenance expenditures (analyze preventive maintenance intervals and the relationship to repairs or âcorrectiveâ maintenance. At what interval are PM + CM costs lowest?) 8. optimize capital expenditures (life cycle cost analysis) 9. determine funding strategy (including trade-offs in what to invest in - replacement vs. expansion) 10. document asset management plan Note: Steps 1-4 and 9-10 represent a relatively basic transit asset management plan, while steps 5-8 represent a relatively sophisticated plan. FTA has not yet indicated the level of sophistication it requires for states and their subrecipients. TIPS ON RELATIONSHIPS TO OTHER MODULES Asset Management is related to Grant Administration, Financial Management, Planning, Procurement, and Safety and Security. LINKS/INFO ⢠FTA State of Good Repair & Asset Management Web page. http://www.fta.dot.gov/13248.html ⢠FTA Advanced Notice of Proposed Rulemaking, âThe National Public Transportation Safety Plan, the Public Transportation Agency Safety Plan, and the Public Transportation Safety CertiÏication Training Program; Transit Asset Managementâ (10/3/13) - http://www.gpo.gov/fdsys/pkg/FR-2013-10-03/pdf/2013-23921.pdf ⢠FTA MAP-21 Fact Sheet: Transit Asset Management (Section 5326). http://www.fta.dot.gov/documents/MAP-21_Fact_Sheet_-_ Transit_Asset_Management.pdf Module 2.15: Asset Management LEVEL II - PAGE II-206
QUIZ 1. A 30â medium duty transit bus has been in revenue service for 5 years. It has accumulated 210,000 total miles and 190,000 revenue miles. The bus: A) Has reached its FTA-deÏined useful life B) Is likely to need an increasing amount of corrective maintenance in the future C) Still has residual life 1) A. 2) A. & B. 3) B. & C. 2. Vehicles stockpiled in a contingency Ïleet should be included in the spare ratio calculation. 1) True. 2) False. 3. Income received from incidental use of real property may be used as part of local share: A) For the grant from which it was derived B) For another FTA grant C) If the incidental use was Ïirst approved by FTA 1) A. 2) B. 3) A. & C. 4) B. & C. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.15: Asset Management LEVEL II - PAGE II-207
KEY CONCEPTS ⢠Public Transit Agency Safety Plans ⢠State Safety Oversight ⢠Public Transportation Safety CertiÏication Training Program ⢠Funding for Employee Safety Training ⢠Currently Available FTA Guidance ⢠One Percent of S. 5307 Funds on Security Projects ⢠Safety-Related Elements in Other FTA Requirements INTRODUCTION Section 5329 of MAP-21 requires that all recipients of FTA funding develop an agency safety plan and certify that the plan meets FTA requirements. Within one year after FTA issues a Ïinal rule on this requirement, each state or recipient of S. 5307 or S. 5311 funds must develop, implement, and certify a public transit agency safety plan. FTA has published an Advanced Notice of Proposed Rulemaking regarding aspects of the S. 5329 safety and asset management requirements to solicit public comment prior to developing this rule. In the interim before the FTA Ïinal rule is issued, FTA encourages transit providers to begin implementing the statutory requirements of the transit agency safety plan. States are advised to begin to assist, and/or require their subrecipients to prepare agency safety plans that include the general areas required under MAP-21. Existing voluntary FTA safety and security planning guidance is available. Section 5307 grantees must annually certify that they are spending at least one percent of such funds for transit security projects, or that such expenditures for security systems are not necessary. ⢠49 USC, Chapter 53, Section 5307 ⢠49 USC, Chapter 53, Section 5329 ⢠FTA Advanced Notice of Proposed Rulemaking, âThe National Public Transportation Safety Plan, the Public Transportation Agency Safety Plan, and the Public Transportation Safety CertiÏication Training Program; Transit Asset Managementâ (10/3/13) ⢠FTA Draft Circular 9030.1D IMPORTANCE FOR STATE DOT STAFF States may have oversight responsibility of subrecipient agency safety plans once the Ïinal rule for 49 CFR 5329 is established. FTA has not yet determined Module 2.16: Safety and Security LEVEL II - PAGE II-208
these responsibilities. In the interim, state staff should stay abreast of FTA development of regulations and follow your stateâs current policies and procedures related to subrecipient safety and security requirements. DETAILS ON FTA REQUIREMENTS 49 USC 5329 provides FTA with the authority to establish a new comprehensive framework to oversee the safety of public transportation throughout the United States. The law requires, among other things, that DOT issue a national public transportation safety plan, establish safety performance criteria for all modes of public transportation, deÏine a âstate of good repair,â establish minimum safety performance standards for public transportation vehicles, and develop a safety certiÏication training program. In addition, public transportation agencies must establish comprehensive agency safety plans for their operations. FTA is currently developing regulations and interim guidance to implement these new requirements in consultation with public transportation industry stakeholders. On October 3, 2013, FTA issued an Advanced Notice of Proposed Rulemaking (ANPRM), âThe National Public Transportation Safety Plan, the Public Transportation Agency Safety Plan, and the Public Transportation Safety CertiÏication Training Program; Transit Asset Management.â FTA posed questions to the industry and seeks comments on this ANPRM by January 2, 2014. NaÆ onal Public TransportaÆ on Safety Plan 49 USC 5329 requires FTA to create and implement a national public transportation plan to improve the safety of all public transportation systems that receive FTA Ïinancial assistance. The national safety plan will be applicable to each FTA recipient and include: (1) safety performance criteria; (2) the deÏinition of state of good repair; (3) a safety certiÏication training program; and (4) vehicle performance standards. Once the criteria and standards are established, transit systems will be required to set targets based on the measures, reÏlecting the yet-to-be-determined deÏinition of state of good repair. These targets will be part of the transit agency safety plan (described below) and incorporated into the metropolitan and statewide planning processes. Module 2.16: Safety and Security LEVEL II - PAGE II-209
Public Transit Agency Safety Plans Within one year after FTA issues a Ïinal rule on the requirement to develop an agency safety plan and certify that the plan meets FTA requirements, each state or recipient of S. 5307 or S. 5311 funds must develop, implement, and certify a public transit agency safety plan. As indicated in the ANPRM, at a minimum, these plans must include: ⢠A requirement that the board of directors, or equivalent entity, approve the plan and any updates; ⢠Methods for identifying and evaluating safety risks throughout all elements of the recipientâs public transportation system; ⢠Strategies to minimize the exposure of the public, personnel, and property to hazards and unsafe conditions; ⢠A process and timeline for conducting an annual review and update of the plan; ⢠Performance targets based on the safety performance criteria and SGR standards set out in the yet-to-be developed national safety plan; ⢠Assignment of an adequately trained safety ofÏicer who reports directly to the general manager, president, or equivalent ofÏicer of the recipient; and ⢠A comprehensive staff training program for operations personnel and personnel directly responsible for safety. In the interim before the FTA Ïinal rule is issued, FTA encourages transit providers to begin implementing the statutory requirements of the transit agency safety plan. State Safety Oversight While MAP-21 established that subrecipients of S. 5311 as well as small transit providers funded by S. 5307 may have their plans drafted or certiÏied by their state, FTA has not yet deÏined âsmall transit providersâ and determined what the responsibilities of the states will be in the plan development and certiÏication process. In the interim before the FTA Ïinal rule is issued, states can begin to assist and/or require their subrecipients to prepare agency safety plans that include the general areas required under MAP-21. Existing voluntary FTA safety and security planning guidance is available. Module 2.16: Safety and Security LEVEL II - PAGE II-210
MAP-21 also established the requirement for an FTA State Safety Oversight (SSO) Program speciÏically for oversight of rail systems. Each state with rail systems not regulated by the Federal Railroad Administration (FRA) is subject to the yet-to-be developed FTA requirements for SSO programs. This will include assuming responsibility for oversight of rail Ïixed-guideway public transportation safety; enforcing federal law for rail Ïixed-guideway public transportation safety; and establishing a SSO agency. Public TransportaÆ on Safety CerÆ fi caÆ on Training Program Part of 49 USC 5329 requires FTA to establish a Public Transportation Safety CertiÏication Training Program applicable to federal and state employees, contractors who conduct oversight, and those employees at transit systems who are responsible for safety oversight. FTA is currently developing proposed Interim Provisions for this program which will be released for public comment under a forthcoming notice in the Federal Register. Funding for Employee Safety Training Under MAP-21, recipients of S. 5307 or S. 5311 funds may use up to 0.5 percent of apportioned formula funds to pay for up to 80 percent of the costs of an applicable transit agency employeeâs participation in the Safety CertiÏication Training Program. Currently Available FTA Guidance Until new FTA safety requirements are established, states can follow the recommendations of existing FTA guidance. ⢠The April 2003 Model Bus Safety and Security Program Memorandum of Understanding (developed under a joint effort by FTA, AASHTO, APTA, and CTAA) recommended the following core elements for all community transportation providers: o Security o Driver/Employee Selection o Driver/Employee Training Module 2.16: Safety and Security LEVEL II - PAGE II-211
o Vehicle Maintenance o Drug and Alcohol Abuse Programs o Safety Data Acquisition and Analysis In addition to these six core elements, enhanced elements are recommended for recipients in urbanized areas. ⢠FTAâs Transit Bus Safety Program website provides numerous technical assistance resources for states and subrecipients. Many states have established their own requirements for subrecipients based on FTA guidance. Some states require each subrecipient to prepare its own Safety, Security, and Emergency Preparedness Plan (SSEPP) or System Safety Program Plan (SSPP). For information about your stateâs safety- and security-related requirements for subrecipients, consult your stateâs SMP, grant application packages, and other guidance provided to subrecipients. One Percent of S. 5307 Funds on Security Projects Section 5307 grantees must annually certify that they are spending at least one percent of such funds for transit security projects, or that such expenditures for security systems are not necessary. Safety-Related Elements in Other FTA Requirements Safety- and security-related elements are found in other FTA requirements, including: ⢠Procurement of vehicles, which must comply with Federal Motor Vehicle Safety Standards (FMVSS). ⢠Drug and alcohol testing programs, which are entirely safety-focused. ⢠Asset management/maintenance, because preventive maintenance is an important element of ensuring safe operations, and the state of repair of assets impacts safety. ⢠National Transit Database (NTD) and Rural NTD reporting, which require statistical reporting of certain safety and security items. Module 2.16: Safety and Security LEVEL II - PAGE II-212
⢠Civil rights, because recipients of FTA funds must ensure that their emergency preparedness, disaster response, and disaster recovery planning and operations comply with federal civil rights laws, including Title VI of the Civil Rights Act of 1964 and the ADA. SUPPLEMENTAL NOTES ⢠Anticipating the FTA safety requirements for small community transportation providers under MAP-21, the Community Transportation Association of America (CTAA) developed a Community Transportation Safety and Security Accreditation (CTSSA) program and a CertiÏied Safety and Security OfÏicer (CSSO) program, based on core elements and critical safety areas of the FTA Model Bus Safety Program. o The CTSAA program accredits community transportation systems that meet certain safety- and security-related quality standards in eight core areas, based on the on-site review conducted by the organizationâs CSSO followed by veriÏication. Accreditation is valid for three years. o The CSSO program prepares individual transit system staff to conduct on-site assessments of their respective transit systemsâ preparedness in eight core areas. ⢠CTAA offers safety training as well as numerous additional safety-related resources tailored for S. 5311 recipients and other smaller community transportation providers, including: o PASS Driver CertiÏication Program o Emergency management resources on the CTAA website ⢠The American Public Transportation Association (APTA) offers safety resources designed for urban transit systems, including: o Manual for the Development of Bus Transit System Safety Program Plans Module 2.16: Safety and Security LEVEL II - PAGE II-213
TIPS ON RELATIONSHIPS TO OTHER MODULES Safety-related items are addressed in the Drug and Alcohol, Asset Management, and Training and Technical Assistance modules. LINKS/INFO ⢠April 2003 Model Bus Safety and Security Program Memorandum of Understanding-http://scopt.transportation.org/ Documents/signedmouscan.pdf ⢠APTA Safety & Security web page - http://www.apta.com/resources/safetyandsecurity/Pages/default.aspx ⢠APTA Manual for the Development of Bus Transit System Safety Program Plans - http://www3.cutr.usf.edu/bussafety/ documents/apta-sspp.pdf ⢠CTAA - www.ctaa.org - click on âresourcesâ and âcertiÏicationâ ⢠FTA Advanced Notice of Proposed Rulemaking, âThe National Public Transportation Safety Plan, the Public Transportation Agency Safety Plan, and the Public Transportation Safety CertiÏication Training Program; Transit Asset Managementâ (10/3/13) - http://www.gpo.gov/fdsys/pkg/FR-2013-10-03/pdf/2013-23921.pdf ⢠FTA Bus Safety Program website - http://bussafety.fta.dot.gov ⢠FTA Transit Safety and Oversight web page - http://www.fta.dot.gov/tso.html ⢠FTA Transit Security website - http://transit-safety.fta.dot.gov/Security/Default.asp ⢠TSA/FTA Security and Emergency Management Action Items for Transit Agencies - http://transit-safety.fta.dot.gov/security/ SecurityInitiatives/ActionItems/actionlist.asp Module 2.16: Safety and Security LEVEL II - PAGE II-214
QUIZ 1. Under MAP-21, states may draft/certify the public transit agency safety plans of both their S. 5311 subrecipients and their S. 5307 small transit providers. 1) True. 2) False. 2. As indicated by the October 2013 ANPRM, public transit agency safety plans must include: A. Approval by a board of directors or equivalent entity. B. A process and timeline for conducting triennial reviews and updates of the plan. C. A comprehensive staff training program for operations personnel and personnel directly responsible for safety. 1) A. 2) B. 3) A and C. 4) All of the above. ⢠FTA MAP-21 Fact Sheet: Transit Safety & Oversight (Section 5329) - http://www.fta.dot.gov/documents/MAP-21_Fact_Sheet_-_ Transit_Safety_and_Oversight.pdf The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.16: Safety and Security LEVEL II - PAGE II-215
KEY CONCEPTS ⢠Threshold for Subrecipients ⢠Oversight of Applicable Subrecipients -EEO OfÏicer Designation -Utilization analysis -Narrative and Statistical Assessment of Employment Practices -Monitoring and Reporting System INTRODUCTION State DOTs must ensure that their subrecipients do not discriminate against any employees or applicants for employment because of race, color, religion, national origin, sex, or age. In addition, recipients and subrecipients must take afÏirmative actions to employ minorities and women. As stated in 49 USC 5332(b), âno person in the United States shall on the grounds of race, color, religion, national origin, sex, or age be excluded from the participation in, be denied the beneÏits of, or be subjected to discrimination under any project, program or activity funded in whole or in part through Ïinancial assistance under this Act.â IMPORTANCE FOR STATE DOT STAFF States are responsible for oversight of subrecipient compliance with Equal Employment Opportunity (EEO) requirements. ⢠States should educate subrecipients on FTA EEO requirements and be able to answer questions on what a subrecipient needs to do to comply. ⢠States must include EEO in the certiÏications and assurances in the subrecipient grant application package, as well as in the grant agreement. ⢠States must monitor subrecipient funding levels and organizational size to determine which subrecipients meet the threshold for an EEO program, and should document this monitoring. ⢠For subrecipients that cross the threshold in the previous funding year, states must obtain an EEO program that meets FTA requirements, upload the plan into TEAM, and obtain an updated plan at least every three years. ⢠States should include review of the subrecipientâs EEO program as part of site and/ or other compliance reviews it conducts. This includes review of documentation that demonstrates that the subrecipient is following its EEO program. ⢠States should monitor the status of any EEO-related complaint reported by a subrecipient. Module 2.17: Equal Employment Opportunity (EEO) LEVEL II - PAGE II-216
DEFINITIONS AfÏirmative Action Plan: a written, detailed, results-oriented set of procedures designed to achieve prompt and full utilization of minorities and women at all levels in all parts of the recipientâs work force. Concentration: a higher representation of minorities and/or women in a job category or department as compared to their representation in the labor market. Transit Related Employee: an employee of an FTA applicant, recipient, or subrecipient who is involved in an aspect of an agencyâs mass transit operation funded by FTA. Underutilization: a lower representation of minorities and/or women in a job category or department as compared to their representation in the labor market. SUMMARY OF FTA REQUIREMENTS Federal Threshold Requirements An EEO program is required of all subrecipients that both: 1) employ 50 or more transit-related employees (including temporary, full, and part-time), and 2) received capital or operating assistance in excess of $1 million or planning assistance in excess of $250,000 in the previous federal Ïiscal year. EEO Program Components Those subrecipients meeting the above threshold must develop, implement, and monitor an effective EEO program. Updates are Module 2.17: Equal Employment Opportunity (EEO) LEVEL II - PAGE II-217
required every three years and must be uploaded to TEAM. States upload the programs submitted by subrecipients into TEAM. The program has seven required components. 1. Statement of Policy The EEO program must include a statement issued by the CEO detailing the agencyâs commitment to EEO and to undertaking an afÏirmative action plan. The statement must note that an EEO ofÏicer is responsible for implementing the program but all management personnel share in the responsibility; that applicants/employees have the right to Ïile discrimination complaints; that employee performance will be evaluated in part on the success of the EEO program; and that the achievement of EEO goals will ultimately provide beneÏits to the recipient. The statement must be signed and dated by the CEO and placed in conspicuous locations, making employees and applicants aware of the EEO commitment. 2. DisseminaÆ on The recipient must have formal mechanisms to publicize and disseminate the EEO policy to applicants, employees, and the public. ⢠Internal dissemination methods (for managers and supervisors): -Written communication from CEO -Inclusion of the policy in the personnel and operations manual -Meetings held with managers and supervisors ⢠Internal dissemination methods (for non-supervisory staff): -Post EEO policy posters and statement on bulletin boards, near time clocks, in the cafeteria and employment/personnel ofÏice -Include policy in employee handbooks, reports, manuals, union contracts Program Components 1) Statement of Policy 2) Dissemination 3) Designation of Personnel Responsibility 4) Utilization Analysis 5) Goals and Timetables 6) Assessment of Employment Practices 7) Monitoring and Reporting Module 2.17: Equal Employment Opportunity (EEO) LEVEL II - PAGE II-218
-Meet with minority and female employees for suggestions about the program -Present EEO program during employee orientation and training programs ⢠External dissemination methods (to regular recruitment sources): -Employment agencies, unions, educational institutions, minority and womenâs organizations, civil rights organizations, and any agency that refers applicants -Public media sources like radio, television stations, newspapers, magazines, journals -All vacancy announcements/ads should state that the recipient is an EEO Employer 3. DesignaÆ on of Personnel Responsibility An EEO program ofÏicer/manager has primary responsibility for administering and implementing the EEO program and should be identiÏied in all program submissions. As stated in the FTA circular, âthe importance of an EEO program is indicated by the individual named to manage the program and the authority he or she possesses.â In line with this authority, the EEO ofÏicer should be an executive level employee (with similar Ïinancial compensation) who reports directly to the CEO and has adequate support staff. At a minimum, the EEO ofÏicer has the following nine responsibilities (C 4704.1 p III-3): ⢠Develop EEO policy and written program ⢠Assist in collecting and analyzing data, identifying problem areas, setting goals/timetables, and developing programs ⢠Measure program effectiveness with internal audit and reporting systems ⢠Report progress to the CEO ⢠Serve as liaison to other organizations and groups ⢠Disseminate current legal information regarding afÏirmative action ⢠Assist in recruiting and establish hiring outreach sources ⢠Concur in all hires and promotions ⢠Process employment discrimination complaints Module 2.17: Equal Employment Opportunity (EEO) LEVEL II - PAGE II-219
Given these responsibilities, subrecipients should assign responsibility for the EEO program with care; an EEO ofÏicer located in the human resources department could lead to conÏlicts of interest. In addition to the ofÏicer, all management level staff have the following responsibilities (C 4704.1 p III-4): ⢠Assist in identifying problem areas ⢠Be involved in local minority organizations ⢠Participate in periodic audits to identify and remove barriers to EEO goals and objectives ⢠Ensure policies and procedures are followed through discussion with other managers ⢠Ensure minority/women employees are given full opportunities for promotions, training, etc. ⢠Participate in review of complaints alleging discrimination ⢠Support career counseling for employees ⢠Participate in periodic audits to ensure compliance (e.g. display of EEO posters) 4. UÆ lizaÆ on Analysis The utilization analysis has two purposes and two components. Its purposes are to: 1) Identify job categories where an underutilization and/or concentration of women or minorities exists in relation to their availability in the relevant labor market. 2) Establish goals, timetables, and other afÏirmative actions to correct employment practices that contributed to any underutilization or concentration. It consists of: 1) A work force analysis- a statistical breakdown by department, job category, grade/rank, and title, cross-referenced by race and sex (in table form). 2) An availability analysis- a comparison of the participation rate of minorities and women with their availability in the labor market (also in table form). Module 2.17: Equal Employment Opportunity (EEO) LEVEL II - PAGE II-220
[See a sample utilization analysis table to the right, Appendix A of FTA Circular 4704.1.] 5. Goals and Timetables Recipients and subrecipients must set speciÏic percentage and numerical goals with timetables to eliminate any gaps (i.e. underutilization) identiÏied in the analysis. These goals and timetables should be attainable; recipients and subrecipients must justify their failure if they are not met (e.g. due to inadequacy in recruitment). Stated as percentages, long-range goals are to be attained in 4 to 5 years. Stated as both numbers and percentages, short-term goals are the net increases in minority and/or womenâs employment by job category within the next 12 months. 6. Assessment of Employment PracÆ ces Recipients and subrecipients must conduct an assessment of present employment practices to identify those that may be barriers contributing to underutilization. The assessment should evaluate the impact of current practices in recruitment, selection, promotion, termination, transfers, layoffs, disciplinary actions, compensation and beneÏits, training, etc. All problem areas must be identiÏied, along with proposed remedial actions. Module 2.17: Equal Employment Opportunity (EEO) LEVEL II - PAGE II-221
The assessment should include a detailed narrative description and analysis of the following procedures/practices: ⢠Recruitment and selection (position descriptions, application forms, selection methods, etc.) ⢠Seniority, promotions, transfers, and training ⢠Compensation and beneÏits ⢠Discipline and terminations ⢠Testing used for employment selection The analysis component must also contain statistical data, including (at a minimum) the number of individuals by race and sex who: ⢠Applied for employment ⢠Were offered employment ⢠Were actually hired ⢠Applied for a promotion or transfer ⢠Were promoted or transferred ⢠Were disciplined (including type of action- e.g. loss of pay) or terminated Quantitative analyses should include the following statistical data by race, national origin, and sex: ⢠Number of job applicants and the number of individuals offered employment ⢠Number of employees in each job category that applied for a promotion or transfer, and the number of employees who were promoted or transferred in the past year ⢠Number of disciplinary actions and terminations (by type) 7. Monitoring and ReporÆ ng The EEO program should include a monitoring and reporting system that: Module 2.17: Equal Employment Opportunity (EEO) LEVEL II - PAGE II-222
1) Assesses accomplishments, 2) Evaluates the program and prompts corrective actions regarding goals and timetables, 3) IdentiÏies units that fail to achieve goals or implement afÏirmative actions, and 4) Provides data for future projections. Sub-Recipient Oversight The state is responsible for ensuring that its subrecipients are in complianceâit must have an approved afÏirmative action plan on Ïile for all subrecipients that meet the threshold requirements. The state must document its review of the plans for adequacy in terms of the seven components. Notes on Diï¬ ering State Program Approaches Some states require an EEO program of subrecipients that do not meet the minimum thresholds, or they may require a subset of the program elements of all subrecipients with the full gamut of FTA-required elements only for those subrecipients that meet minimum thresholds. State transit staff need to be familiar with what their speciÏic state requires, and should also be familiar with the FTA requirements and where they differ. Oversight of subrecipient EEO programs may be a responsibility of a different ofÏice or division within your department than other areas of FTA program oversight. For example, this responsibility may be located within that state DOT ofÏice of civil rights, fair practices, or the like. This ofÏice may oversee all EEO requirements for the state, including those required by FHWA and other administrations within US DOT. State transit program staff need to know which ofÏice is responsible for EEO oversight. SUPPLEMENTAL NOTES Chapter V of C 4704.1 describes the remedial actions and enforcement procedures that occur when/if recipients or sub-recipients are in noncompliance with the EEO requirements (including the submission of a remedial action plan). Chapter VI of C 4704.1 details FTA procedures for Ïiling discrimination complaints, including submission, investigation, and disposition. Module 2.17: Equal Employment Opportunity (EEO) LEVEL II - PAGE II-223
TIPS ON RELATIONSHIPS TO OTHER MODULES ⢠EEO does not address employment discrimination against individuals with disabilities, but such discrimination is also prohibited (see the ADA module for more details). EEO is in addition to the provisions and requirements of Title VI (see the Title VI module for more details). ⢠An EEO clause is required in any procurements that exceed the federal threshold for micro-purchases that use FTA funds, including lower-tier contracts. For construction projects exceeding $10,000, the special Department of Labor EEO clause must be included. For any rolling stock purchase over $10,000, and for all other types of procurements, the EEO clause is grouped with other civil rights clauses (see the Procurement module for more details on contract clause requirements). LINKS/INFO ⢠49 USC Part 5332(b). ⢠FTA Equal Employment Opportunity website. http://www.fta.dot.gov/civilrights/12327.html. ⢠FTA Master Agreement Section 13. http://www.fta.dot.gov/documents/19-Master.pdf. ⢠FTA EEO Questionnaire. http://www.fta.dot.gov/images/photos/TRO_7/EEO_QUESTIONNAIRE_8-19-11.pdf. ⢠FTA Circular 4704.1, âEqual Employment Opportunity Program Guidelines for Grant Recipients.â http://www.fta.dot.gov/ documents/UMTA_C_4704.1.pdf. Module 2.17: Equal Employment Opportunity (EEO) LEVEL II - PAGE II-224
QUIZ 1. A subrecipient has 20 full-time transit-related employees, 10 part-time transit-related employees, and received $1.5 million in operating assistance in the last Ïiscal year. This subrecipient meets the federal threshold requiring an EEO/ afÏirmative action program. 1) True. 2) False. 2. Below is a simpliÏied version of a Utilization/Availability Analysis chart. In which categories is underutilization occurring? A) Minority OfÏicials/Managers B) Female Professionals C) Female Technicians D) Minority Technicians 1) A. & B. 2) B. & C. 3) A & C. 4) A. & D. Job Title Total # Employees Current # Current % Availability % Minority Female Minority Female Minority Female OfÏicials/Managers 21 6 8 29 38 32 32 Professionals 52 18 26 35 50 24 46 Technicians 4 2 1 50 25 18 42 Module 2.17: Equal Employment Opportunity (EEO) LEVEL II - PAGE II-225
3. Which of the following actions fails to meet the minimum responsibilities required of an EEO OfÏicer? A) Processing employment discrimination complaints. B) Concurring in the hiring and promotions of employees at the managerial-level and above. C) Reporting periodically to the CEO on EEO progress. 1) A. 2) B. 3) C. 4) None of the above. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.17: Equal Employment Opportunity (EEO) LEVEL II - PAGE II-226
KEY CONCEPTS ⢠Prevailing Wage Requirement ⢠Employee Protective Arrangements - DOL CertiÏication - National (Model) Agreement - Special Warranty for Rural Areas - Special Warranty Notice to Employees INTRODUCTION All recipients (and subrecipients) of FTA funding must comply with labor standards detailed in 49 USC 5333. The labor standards involve two parts: prevailing wages and employee protective arrangements. The latter involves the bulk of the requirements. When federal funds are used to acquire, improve, or operate a transit system, federal law requires arrangements to protect the rights of affected transit employees. The terms and conditions of the protective arrangements are included in the granteeâs contract with the FTA. The requirement to protect transit employees is contained in 49 USC 5333(b) (formerly Section 13(c) of the Federal Transit Act). Section 5333(b) speciÏies that the arrangements must provide for the preservation of rights and beneÏits of employees under existing collective bargaining agreements, continuation of collective bargaining rights, protection of individual employees against a worsening of their positions in relation to their employment, assurances of employment to employees of acquired transit systems, priority of reemployment, and paid training or retraining programs. Projects funded under S. 5311 must satisfy the employee protection requirements of Section 5333(b), but this is accomplished through an expedited procedure administered by the Department of Labor (DOL) and based on the application of the âSpecial Section 13(c) Warrantyâ (Warranty). DOL procedures under the Warranty require that state agencies applying for S. 5311 funds must take certain steps to demonstrate that the terms of the Warranty are understood and agreed to by the recipients of funds. Additionally, the Warranty requires that recipients (and subrecipients) post, in a prominent and accessible place, the terms and conditions of the Warranty with a notice stating that the recipient has agreed to comply with these terms. Employees who believe they have been affected as a result of federal transit assistance may Ïile claims with DOL under the Warranty. This means that the state (and its subrecipients) must make the necessary arrangements so that covered employees (or their union representative) may Ïile such a claim. Module 2.18: Labor Protection/Special Warranty LEVEL II - PAGE II-227
IMPORTANCE FOR STATE DOT STAFF Federal law requires the protection of the rights and interests of transit employees who are impacted by projected FTA funding. Before FTA may award a grant for capital or operating assistance, fair and equitable arrangements must be in place for transit employees. As a recipient of FTA funds, the state must ensure that it and its subrecipients comply with labor standards and protect their employees. DOL is responsible for compliance oversight on these requirements. If DOL Ïinds that a S. 5311 applicant does not fulÏill the procedures and requirements of the Special Warranty, the applicant would be ineligible for federal funds until the non-compliance issue is resolved. To ensure subrecipient compliance: ⢠States should educate subrecipients on the labor standards and on their responsibilities to both DOT and DOL. ⢠States must require Special Warranty certiÏication and submission of DOL-required information as part of S. 5311 subrecipient applications. ⢠States must include the terms and conditions of the protective arrangement in subrecipient grant agreements. DEFINITIONS Davis-Bacon Act: enacted in 1931, the Act (as amended) requires paying local prevailing wages on public works projects, including construction projects funded by FTA valued at $2,000 or more. National (Model) Agreement: a protective agreement entered into in July 1975 by representatives of the American Public Transit Association, Amalgamated Transit Union, Transport Workers Union of America, AFL-CIO, Railway Labor Executivesâ Association, Brotherhood of Locomotive Engineers, Brotherhood of Railway and Airline Clerks, and International Association of Machinists and Aerospace Workers. The Agreement is certiÏied by DOL as fair and equitable and is thus a source document for the standard terms and conditions of employee protective arrangements. Module 2.18: Labor Protection/Special Warranty LEVEL II - PAGE II-228
Special Warranty: formalized by DOL and DOT in May 1979, the Special Warranty is the protective arrangement applicable to the S. 5311 program. It provides fair and equitable arrangements to protect the interests of employees and meets the requirements of 49 USC 5333(b). DETAILS ON FTA REQUIREMENTS- CIRCULAR LEVEL Prevailing Wage Requirement Prevailing wages mean that for construction projects only, laborer and mechanic contractors and subcontractors must âbe paid wages not less than those prevailing on similar construction in the locality...â Prevailing wages are determined by the Secretary of the DOL in accordance with 40 USC Chapter 31, also known as the Davis-Bacon Act. Employee ProtecÆ ve Arrangements FTA funding is conditioned on employee protective arrangements, as speciÏied in 49 USC 5333(b), formerly Section 13(c) of the Federal Transit Act. Employee protective arrangements cover employees involved in projects funded under S. 5307, 5308, 5309, 5312, 5316, 5337, and 5339. DOL must certify the protective arrangements prior to FTA award of funding. DOL certiÏication veriÏies that the terms and conditions of the arrangement are fair and equitable, following the DOLâs âGuidelines, Section 5333(b), Federal Transit Lawâ (29 CFR 215). The arrangements must include provisions regarding the following: ⢠the preservation of rights, privileges, and beneÏits under existing collective bargaining agreements, ⢠the continuation of collective bargaining rights, ⢠the protection of individual employees against a worsening of their positions related to employment, ⢠assurances of employment to employees of acquired public transportation systems, ⢠assurances of priority of reemployment, and ⢠paid training or retraining programs. Module 2.18: Labor Protection/Special Warranty LEVEL II - PAGE II-229
Employees of S. 5311 subrecipients are protected by a Special Warranty speciÏically for the S. 5311 program, discussed later in this module. FTA applicants for urbanized area funds are subject to closer scrutiny by DOL. Although oversight responsibility rests with DOL, it is useful for state DOT transit staff to be aware of DOL requirements and procedures, since release of FTA funds is contingent upon DOL certiÏication of the application to FTA. FTA forwards applications received for applicable funding. When DOL receives a grant application from FTA, it then refers a copy of the grant application and its proposed terms and conditions to the union(s) representing transit employees in the project service area and to the applicant and/or recipient. The referral begins a 60-day time frame for DOL certiÏication. Unifi ed ProtecÆ ve Arrangement For employees of urbanized FTA applicants who do not already have a protective arrangement (i.e., a labor union) in place, DOL draws on a document called the UniÏied Protective Arrangement. This document sets forth terms and conditions the FTA recipient must comply with for the protection of the transportation related employees in the transportation service area of the project. As a precondition of the release of assistance by the grantee to any additional recipient under the grant, the grantee must incorporate the UniÏied Protective Arrangement into its contract with the recipient, by reference, binding the recipient to these arrangements. The text of the agreement is posted on the DOL website at http://www.dol.gov/olms/regs/compliance/transit/6_UPA-01-03-11.htm. The parties involved must agree on the terms and conditions of the protective arrangement, and have 15 days to inform DOL of any objections to the recommended terms and conditions. DOL certiÏies the project if the parties do not object or if DOL Ïinds their objections insufÏicient. If DOL determines that the objections are sufÏicient, the parties are directed to negotiate for up to 30 additional days. Depending on the outcome of the negotiations, DOL issues either a Ïinal or an interim certiÏication permitting the release of FTA funds. Module 2.18: Labor Protection/Special Warranty LEVEL II - PAGE II-230
NaÆ onal (Model) Agreement Employee protections can be developed through local negotiations between transit providers and employees/labor organizations. However, parties can also adopt the National (Model) Agreement as a ready-made employee protective arrangement. The National (Model) Agreement was executed in 1975 by representatives of the American Public Transportation Association, the Amalgamated Transit Union, the Transport Workers Union of America, and multiple other labor organizations. It provides fair and equitable arrangements to protect the interests of employees in general purpose operating assistance project situations and meets the requirements of 49 USC 5333(b). Special Warranty for Rural Areas Projects in rural areas funded through S. 5311 have different employee protective arrangement requirements: DOLâs Special Warranty. The Special Warranty, originally known as the Special 13(c) Warranty, represents the understandings of a DOL and DOT reached in May 1979 and includes the provisions of the National (Model) Agreement. The Special Warranty for S. 5311 providers allows for an expedited procedure administered by DOL, protecting the labor rights of employees without the necessity for DOL review of each individual subrecipientâs application. Instead, DOL reviews the stateâs Section 5333(b) submittals for its S. 5311 application. The Special Warranty details labor issues such as collective bargaining and the rights of employees who are dismissed or displaced from their jobs. It stipulates that the collective bargaining rights of employees, âincluding the right to arbitrate labor disputes and to maintain union security and checkoff arrangements,â are preserved. It also deÏines the differences between a displaced and a dismissed employee and computes the accurate allowance for each type of individual. Furthermore, it sets the terms for the allowances and coverage related to employee change of residence. As the S. 5311 applicant, the state must incorporate the terms of the Special Warranty into subrecipient applications and agreements. As part of their annual certiÏications and assurances, S. 5311 subrecipients must agree to the 5333(b) labor provisions. The state must list in the overall S. 5311 application to the FTA all the transportation providers in the service area (subrecipients and others), plus Module 2.18: Labor Protection/Special Warranty LEVEL II - PAGE II-231
the labor organizations representing the employees of those providers. The FTA then notiÏies the DOL of all funding approved under S. 5311 with a copy of each approved application. Prior to its repeal in MAP-21, the Special Warranty also applied to the Over-the-Road Bus Program (formerly S. 3038 of TEA-21). Except in special cases, the requirements of 5333(b) do not apply to subrecipients funded under the Enhanced Mobility of Seniors and Individuals with Disabilities (S. 5310). SecÆ on 5333(b) NoÆ ce to Employees FTA recipients and subrecipients (including S. 5311) are required to post, in a prominent and accessible place, a notice stating that they have received federal assistance and agreed to comply with the terms of 49 USC, Section 5333(b). Third-Party Contracts for TransportaÆ on Services When a recipient acquires public transportation services from a third party contractor, the terms of the recipientâs DOL certiÏication of public transportation employee protective arrangements will apply to work under the contract provided by those employees covered by the certiÏication. Consequently, as a matter of contractor responsibility, the recipient must include provisions in its third party contract ensuring compliance or obtain the third party contractorâs agreement in another form. SUPPLEMENTAL NOTES ⢠Employees who believe they have been adversely affected as a result of federal transit assistance may Ïile claims under the procedures set forth in the protective arrangements certiÏied by DOL. ⢠Non-union employees have the same level of protection by the DOL certiÏication as employees who are represented by a labor organization (see the DOL Website for its standard non-union protective arrangement). Module 2.18: Labor Protection/Special Warranty LEVEL II - PAGE II-232
⢠Labor protection requirements arose from the passage of the Urban Mass Transportation Act of 1964. Transit unions were concerned about possible negative impacts of federal funding: technologies and automation could reduce the need for labor, and/or private employee rights (regarding wages, hours, working conditions, beneÏits, etc.) could be lost during public acquisition. For an indepth analysis, see Woodman, Starke, and Schwarz, âTransit Labor Protection- A Guide to Section 13(c) Federal Transit Act.â Transit Cooperative Research Program. June 1995. http://onlinepubs.trb.org/onlinepubs/tcrp/tcrp_ lrd_04.pdf. TIPS ON RELATIONSHIPS TO OTHER MODULES ⢠Labor protections applicable to third party contracts, including the Davis-Bacon Act and S. 5333(b), must be included in applicable solicitations. This requirement is brieÏly referenced in the Procurement Policies, Process, and History module. LINKS/INFO ⢠FTA Master Agreement Section 28. http://www.fta.dot.gov/documents/19-Master.pdf. ⢠29 CFR 215, Guidelines, Section 5333(b), Federal Transit Law. http://www.ecfr.gov. ⢠49 USC 5333. ⢠National (Model) Agreement, Pursuant to Section 13(c) of the Urban Mass Transportation Act of 1964, as Amended. http:// www.dol.gov/olms/regs/compliance/agreement.htm. ⢠OfÏice of Labor-Management Standards, US Department of Labor Website. http://www.dol.gov/olms/regs/compliance/ compltransit.htm. Module 2.18: Labor Protection/Special Warranty LEVEL II - PAGE II-233
QUIZ 1. Do Section 5333(b) protections apply to non-union employees? 1) Yes. 2) No. 2. Employee protective arrangements: A. Preserve and continue existing collective bargaining rights B. Create new collective bargaining relationships C. Offer assurances of employment to employees of acquired public transit systems 1) A. 2) B. 3) A and C. 4) B and C. ⢠Special Warranty Arrangement. OfÏice of Labor-Management Standards, US Department of Labor. October 1, 2008. http:// www.dol.gov/olms/regs/compliance/transit/07_Special_Warranty.htm. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.18: Labor Protection/Special Warranty LEVEL II - PAGE II-234
Module 2.19: Drug and Alcohol Testing and Drug-Free Workplace Act Programs KEY CONCEPTS ⢠Drug and Alcohol Program for Safety-Sensitive Employees o Applicability o Required Policies o Substances Tested o Types of Testing o Pre-Employment Procedures o Random Testing Rates o Post Accident Testing o Monitoring Vendors ⢠Drug-Free Workplace Act Policy and Program INTRODUCTION Recipients of S. 5307, 5309, or 5311 funds must have a drug and alcohol testing program in place for all safety-sensitive employees. In addition, grantees that receive an award directly from a federal agency are required to maintain a drug-free workplace for all employees and to have an ongoing drug-free awareness program. The drug-free workplace and awareness requirements do not apply to subrecipients but do apply to the state DOT as an employer. The regulations are: ⢠49 CFR Part 655 âPrevention of Alcohol Misuse and Prohibited Drug Use in Transit Operationsâ ⢠49 CFR Part 40 âProcedures for Transportation Workplace Drug Testing Programsâ ⢠49 CFR Part 32 âGovernmentwide Requirements for a Drug-Free Workplace (Financial Assistance)â ⢠41 USC Sections 701 âDrug Free Workplace Act (DFWA) of 1988 IMPORTANCE FOR STATE DOT STAFF States are responsible for passing through drug and alcohol testing requirements; providing technical assistance in understanding and meeting the requirements; and overseeing the drug and alcohol programs of subrecipients and their contractors, subcontractors, and lessees with safety-sensitive employees. The oversight program must ensure that all aspects of the drug and alcohol programs, including use of vendors and vendor activities, are in compliance with 49 CFR Part 655, Prevention of Alcohol Misuse and Prohibited Drug Use in Transit Operations, as amended, and 49 CFR Part 40, Procedures for Transportation Workplace Drug and Alcohol Testing Programs, as amended. LEVEL II - PAGE II-235
DEFINITIONS Accident: an occurrence associated with the operation of a vehicle, if as a result: (1) An individual dies; or (2) An individual suffers bodily injury and immediately receives medical treatment away from the scene of the accident; or (3) With respect to an occurrence in which the mass transit vehicle involved is a bus, electric bus, van, or automobile, one or more vehicles (including non-FTA funded vehicles) incurs disabling damage as the result of the occurrence and such vehicle(s) are transported away from the scene by a tow truck or other vehicle; or (4) With respect to an occurrence in which the public transportation vehicle involved is a rail car, trolley car, trolley bus, or vessel, the public transportation vehicle is removed from operation. Breath Alcohol Technician (BAT): An individual who instructs and assists individuals in the alcohol testing process and operates an EBT. Collection Site: a place where employees present themselves for the purpose of providing a urine specimen for a drug test and/or for a breath alcohol test. Consortium/Third-Party Administrator (C/TPA): a service agent that provides or coordinates the provision of a variety of drug and alcohol testing services to employers. C/TPAs typically perform administrative tasks concerning the operation of the employersâ drug and alcohol testing programs. This term includes, but is not limited to, groups of employers who join together to administer, as a single entity, the DOT/FTA drug and alcohol testing programs of its members. Covered Employee: a person, including an applicant or transferee, who performs or will perform a safety-sensitive function. A volunteer is a covered employee if: (1) The volunteer is required to hold a commercial driverâs license to operate the vehicle; or (2) The volunteer performs a safety-sensitive function for an entity subject to this part and receives remuneration in excess of his or her actual expenses incurred while engaged in the volunteer activity. Module 2.19: Drug and Alcohol Testing and Drug-Free Workplace Act Programs LEVEL II - PAGE II-236
Evidential Breath Testing (EBT): An EBT approved by the National Highway TrafÏic Device Safety Administration (NHTSA) for the evidential testing of breath and placed on NHTSAâs Conforming Products List of Evidential Breath Measurement Devices (CPL). Medical Review OfÏicer (MRO): a person who is a licensed physician and who is responsible for receiving and reviewing laboratory results generated by an employerâs drug testing program and evaluating medical explanations for certain drug test results. Safety-Sensitive Function: any of the following duties, when performed by employees of recipients, subrecipients, operators, or contractors: (1) Operating a revenue service vehicle, including when not in revenue service; (2) Operating a nonrevenue service vehicle, when required to be operated by a holder of a Commercial Driverâs License; (3) Controlling dispatch or movement of a revenue service vehicle; (4) Maintaining (including repairs, overhaul, and rebuilding) a revenue service vehicle or equipment used in revenue service. This does not apply to an employer who receives funding under S. 5307 or 5309, is in an area less than 200,000 in population, and contracts out such services; or an employer who receives funding under S. 5311 and contracts out such services; (5) Carrying a Ïirearm for security purposes. Substance Abuse Professional (SAP): a person who evaluates employees who have violated a DOT drug and alcohol regulation and makes recommendations concerning education, treatment, follow-up testing, and aftercare. DETAILS ON FTA REQUIREMENTS Drug and Alcohol Program for Safety-SensiÆ ve Employees Applicability Recipients of S. 5307, 5309/5339, or 5311 funds must have a drug and alcohol testing program in place for all safety-sensitive employees. Module 2.19: Drug and Alcohol Testing and Drug-Free Workplace Act Programs LEVEL II - PAGE II-237
FTA drug and alcohol testing requirements may not apply to grantees that receive FTA funds exclusively for facilities and do not operate service under S. 5307, 5309/5339, or 5311 if these funds can be segregated from other program funds. Volunteer drivers are not subject to testing unless the volunteers are required to hold a CDL or receive remuneration in excess of expenses incurred while engaged in a safety-sensitive function. Subrecipients that operate a ferry system are considered to be in compliance with FTA regulations when they comply with the U.S. Coast Guardâs (USCG) chemical and alcohol testing requirements. However, those ferry operations are subject to FTAâs random alcohol testing requirement for employees considered safety-sensitive by the USCG (crew members with a merchant mariners document or under a certiÏicate of inspection), since the USCG does not have a similar requirement. States that have subrecipients subject to drug and alcohol testing as part of a Federal Motor Carrier Safety Administration (FMCSA) program must ensure that any individual who also provides services to the transit system is subject to FTA regulations while performing FTA-deÏined safety-sensitive functions. For example, a municipal transit system may have maintenance performed by a mechanic employed by the city government who repairs transit vehicles as well as other city-operated equipment. At times when this employee works on transit vehicles, he or she would be subject to FTA regulations speciÏically in post-accident and reasonable suspicion events. Maintenance contractors in rural and small urbanized areas (areas under 200,000 population) are not subject to drug/alcohol testing requirements. In large urbanized areas, contractors performing safety-sensitive work, such as tire maintenance and overhaul or rebuild of vehicles, engines, and parts or body work, are subject to FTA regulations unless the work is done on an ad-hoc (non- routine) basis. Warranty work performed by employees of a bus manufacturer is not subject to the regulations. Also, vendors from whom grantees purchase or exchange rebuilt engines or other components are not subject to the regulations unless that work is regular and on-going. Note that Ïirst tier contractors that provide maintenance services to an operations contractor are subject to FTAâs drug and alcohol testing regulations. Module 2.19: Drug and Alcohol Testing and Drug-Free Workplace Act Programs LEVEL II - PAGE II-238
If taxicab companies are used to provide transit services (e.g., paratransit), the applicability of drug and alcohol testing depends on the nature of the service. If there is a contract with one or more taxicab companies and the subrecipient schedules and dispatches the trips, then the drug and alcohol testing regulations apply. However, FTA regulations do not apply if a transit patron (or broker) chooses the taxicab company with a user-side subsidy or voucher, even if there is only one company available. The regulations do not apply to taxicab maintenance contractors, provided the primary purpose of the taxicab company is not public transit service. Off-duty police ofÏicers under contract to a subrecipient are subject to FTA drug and alcohol testing. Police ofÏicers who, as part of their normal duties, patrol public transit facilities are not subject to FTA testing. When a subrecipient contracts the local police department but does not supervise the ofÏicers and the ofÏicers also respond to nontransit-related police calls, the ofÏicers are not subject to FTAâs drug and alcohol rules. Required Policies Subrecipients (and their contractors, subcontractors, and lessees) with safety-sensitive employees must have a drug and alcohol policy detailing the provisions of their drug and alcohol program. The following checklist identiÏies the minimum requirements of a policy as deÏined by 49 CFR 655.15: ⢠Proof of policy adoption by the appropriate governing body with effective date indicated. ⢠Identity of the person designated by the employer to answer questions about the anti-drug and alcohol misuse program. ⢠Categories of employees who are subject to testing. ⢠Prohibited behavior, including when the regulations prohibit the use of alcohol and drugs. ⢠Testing circumstances for drugs and alcohol (i.e., pre-employment, random, post-accident, reasonable suspicion, return-to- duty, and follow-up testing). ⢠Drug and alcohol testing procedures consistent with 49 CFR Part 40, as amended. ⢠Requirement that covered employees submit to drug and alcohol testing administered in accordance with FTA regulations. ⢠Description of the behavior and circumstances that constitute a refusal to take a drug and/or alcohol test and a statement that a refusal constitutes a veriÏied positive test result. Instead of listing all the refusals, the policy may state that refusals to test Module 2.19: Drug and Alcohol Testing and Drug-Free Workplace Act Programs LEVEL II - PAGE II-239
are listed in 49 CFR Part 40 as amended or 49 CFR 40.191 as amended for urine collections and 49 CFR 40.261 as amended for breath tests. The policy should then state that a copy of 49 CFR Part 40 is available upon request. However, if the policy lists any refusals to test, the policy must list all of them. The following describes refusals under the DOT program: 1. Failing to appear for any test (except a pre-employment test) within a reasonable time, as determined by the employer, after being directed to do so by the employer. 2. Failing to remain at the testing site until the testing process is complete (an employee who leaves the testing site before the testing process commences for a pre-employment test is not deemed to have refused to test). 3. Failing to provide a urine specimen for any drug test required by this part or DOT agency regulations. 4. Failing to provide a sufÏicient amount of urine when directed, and it has been determined, through a required medical evaluation, that there was no adequate medical explanation for the failure. 5. Failing or declining to take an additional drug test the employer or collector has directed you to take. 6. Failing to undergo a medical examination or evaluation, as directed by the MRO as part of the veriÏication process, or employer. In the case of a pre-employment drug test, the employee is deemed to have refused to test on this basis only if the pre-employment test is conducted following a contingent offer of employment. If there was no contingent offer of employment, the MRO will cancel the test. 7. Failing to cooperate with any part of the testing process (e.g., refusing to empty pockets when directed by the collector, behaving in a confrontational way that disrupts the collection process, failing to wash hands after being directed to do so by the collector). 8. In the case of a directly observed or monitored collection in a drug test, failing to permit the observation or monitoring of your provision of a specimen. 9. For an observed collection, failing to follow the observerâs instructions to raise your clothing above the waist, lower clothing and underpants, and to turn around to permit the observer to determine if you have any type of prosthetic or other device that could be used to interfere with the collection process. 10. Possessing or wearing a prosthetic or other device that could be used to interfere with the collection process. 11. Admitting to the collector or MRO that you adulterated or substituted the specimen. ⢠Description of the consequences for a covered employee who has a veriÏied positive drug test result or a conÏirmed alcohol test Module 2.19: Drug and Alcohol Testing and Drug-Free Workplace Act Programs LEVEL II - PAGE II-240
with an alcohol concentration of 0.04 or greater. If the system has a second chance policy, a description of the evaluation and treatment processes must be included. ⢠Description of the consequences for covered employees found to have an alcohol concentration of 0.02 or greater but less than 0.04. In addition to the requirements listed above, the policy should include the subrecipientâs policy toward retesting of negative dilute urine collections. 49 CFR 40.197 states that if the MRO informs the agency that a negative drug test was dilute, the agency may, but is not required to, direct the employee to take another test immediately. All employees must be treated the same for this purpose. For example, the subrecipient must not retest some employees and not others. The subrecipient may retest for some types of tests (e.g., pre-employment tests) and not others. The policy should state whether or not immediate retesting for negative dilutes is required and, if required, that the second test will be the test of record. Some subrecipients may have modeled their testing programs after FMCSA regulations (49 CFR Part 82). FMCSA regulations do not meet FTA requirements. For example, FMCSA only covers CDL holders. If the program refers to âcovered employeeâ as an employee with a CDL, the program is probably fashioned after FMCSA regulations. Substances Tested The following substances are required to be tested for: marijuana, cocaine, opiates, phencyclidine, amphetamines, and alcohol. If the employer lists sub-categories under the amphetamines and opiates, they must list them all and be consistent with Part 40: Opiates (Morphine, Codeine, and Heroin/6-Acetylmorphine), Amphetamines (Amphetamine, Methamphetamine, MDMA, MDEA, and MDA). Employers should not list cut-off concentrations for drugs unless they agree exactly with Part 40.87. Types of TesÆ ng Six types of testing are required: ⢠Pre-employment (mandatory for drugs and optional but consistent for alcohol) Module 2.19: Drug and Alcohol Testing and Drug-Free Workplace Act Programs LEVEL II - PAGE II-241
⢠Random ⢠Post-accident ⢠Reasonable suspicion ⢠Return to duty (only for employers with a second chance policyâdirect observation required) ⢠Follow-up (only for employers with a second chance policyâdirect observation required) If pre-employment tests are conducted, Part 40 testing procedures must be followed. Employees who have returned to duty from an absence of 90 days or more and have been removed from the random testing pool during that time must pass a pre-employment test, not a return to duty test, before being placed back into safety-sensitive duty. If there is a second chance policy for employees who admit to drug or alcohol use/misuse outside the testing process, any return to duty and follow up testing is done under the employerâs authority, not FTAâs, as 49 CFR Part 655 does not address employees who self- disclose drug use or alcohol misuse. Pre-Employment Procedures Subrecipients (and their contractors, subcontractors, and lessees) with safety-sensitive employees, after obtaining an employeeâs written consent (as per 49 CFR Part 40.25), must request information on the DOT drug and alcohol testing history of anyone who is seeking to begin performance of safety-sensitive duties for the subrecipient for the Ïirst time (i.e., a new hire, or if an employee transfers into a safety-sensitive position). Employers must request the following information from other DOT-regulated employers who have employed the individual during any period during the two years before the date of application or transfer: ⢠Alcohol tests with a result of 0.04 or higher alcohol concentration ⢠VeriÏied positive drug tests ⢠Refusals to be tested (including veriÏied adulterated or substituted drug test results) ⢠Other violations of DOT agency drug and alcohol testing regulations ⢠The employeeâs successful completion of DOT return-to-duty requirements (including follow-up tests), if applicable Module 2.19: Drug and Alcohol Testing and Drug-Free Workplace Act Programs LEVEL II - PAGE II-242
If the previous employer does not have information about the return-to-duty process (e.g., for an employer who did not hire an employee who tested positive on a pre-employment test), the subrecipient must obtain this information from the employee. The subrecipient must obtain and review this information before the employee Ïirst performs safety-sensitive functions, if feasible. If this is not feasible, the employer must obtain and review the information as soon as possible. After 30 days, the subrecipient must not permit the employee to perform safety-sensitive functions unless it has obtained or made and documented a good faith effort to obtain this information. If the employee refuses to provide written consent, the subrecipient must not permit the employee to perform safety-sensitive functions. If the subrecipient obtains information that the employee has violated a DOT agency drug and alcohol regulation, it must not use the employee to perform safety-sensitive functions unless it also obtains information that the employee has subsequently complied with return-to-duty requirements. The subrecipient must also ask the employee whether he or she has tested positive or refused to test on any pre-employment drug or alcohol test administered by an employer to which the employee applied for, but did not obtain, safety-sensitive transportation work covered by DOT agency drug and alcohol testing rules during the past two years. If the employee admits that he or she had a positive test or a refusal to test, the subrecipient must not use the employee to perform safety-sensitive functions until and unless the employee documents successful completion of the return-to-duty process. Random TesÆ ng Subrecipients are also responsible for conducting drug and alcohol tests on all covered employees on a random basis. Random tests must be selected using a scientiÏically valid method and with no discretion by managers (i.e., all covered employees must have an equal chance of being selected). Subrecipients must ensure that the dates for administering random tests are spread reasonably throughout the calendar year (i.e., testing starts in January and there is no period during which testing is halted) and testing must be conducted on all days and hours during which safety-sensitive functions are performed. This ensures that employees will have a reasonable expectation that they might be called for a test on any day and at any time they are at work. Module 2.19: Drug and Alcohol Testing and Drug-Free Workplace Act Programs LEVEL II - PAGE II-243
Subrecipients must also ensure that random drug and alcohol tests are unannounced and unpredictable; covered employees who are notiÏied of selection for random drug or random alcohol testing must proceed to the test site immediately. A covered employee should only be randomly tested for alcohol misuse while the employee is performing safety-sensitive functions, just before the employee is to perform safety-sensitive functions, or just after the employee has ceased performing such functions. Random testing rates of safety sensitive employees for drugs and alcohol must be conducted at levels speciÏied by FTA. The current minimum annual random testing rate for drugs is 25 percent of the number of safety sensitive employees. The current minimum annual random testing rate for alcohol is 10 percent. States with subrecipients that have a separate random pool for FTA safety sensitive employees must be able to document that subrecipients meet the required random testing rates. States with subrecipients that are part of a larger consortium random pool must be able to document that the consortiumâs random testing rates meet the FTA required rates. Post Accident TesÆ ng FTA requires that a DOT post-accident test be administered under two circumstances: 1) in the event of a fatal accident; and 2) in the event of a non-fatal accident. A fatal accident is deÏined as an occurrence associated with the operation of a transit revenue vehicle or ancillary vehicle (a non-revenue vehicle requiring a CDL or used by transit police), which results in the loss of a life. A non-fatal accident is an occurrence associated with the operation of a transit revenue vehicle or ancillary vehicle, deÏined by the following: ⢠One or more individuals is immediately transported for medical treatment away from the accident ⢠Any rubber-tired vehicle incurs disabling damage requiring a tow truck ⢠A rail transit vehicle is taken out of service as a result of the accident Following a fatal accident involving a transit vehicle, subrecipients (and their contractors, subcontractors, and lessees) with safety- sensitive employees are required to test all surviving covered employees operating the vehicle at the time of the accident and, using the best available information at the time of the decision, any other covered employee whose performance may have contributed to the accident. Module 2.19: Drug and Alcohol Testing and Drug-Free Workplace Act Programs LEVEL II - PAGE II-244
Following a nonfatal accident involving a transit vehicle, subrecipients with safety-sensitive employees are required to test all covered employees operating the vehicle and any other covered employee whose performance may have contributed to the accident unless the employer determines that an employeeâs performance can be completely discounted as a contributing factor to the accident. A decision not to test is made using the best information available at the time of the decision and must be documented in detail, including the decision-making process used to make the determination. Post-accident testing for âaccidentsâ that do not meet the deÏinition of an accident under Part 655 must be done under the subrecipientâs own authority. Monitoring Vendors The state, as the grantee, is ultimately responsible for the integrity of the drug and alcohol testing program and the quality of testing services provided by vendors. Consequently, the state should ensure that subrecipients have a written contract that references 49 CFR Part 40 with each vendor and should monitor the quality of testing service vendors, including collection sites, MROs, and SAPs. States need only ensure that testing laboratories are HHS certiÏied. The state should not assume that vendors are following the correct procedures or that they are knowledgeable about FTA regulations. Note that FTA does not prescribe how a state must monitor vendors. The state simply must show evidence that monitoring is being performed at some level. Examples of monitoring activities include maintaining on Ïile copies of vendor qualiÏications, conducting periodic mock collections, investigating reports of employees or subrecipients of Ïlawed procedures, requiring detailed explanations for cancelled tests, and documenting error correction training. As it is the responsibility of the employer to ensure that program records are accurate and current and that they comply fully with FTA regulations, states and subrecipients should review copies of Custody and Control Forms (CCFs) and Alcohol Testing Forms (ATFs) to ensure they are completed accurately and legibly and should follow up with collections when forms are not completed correctly or indicate proper procedures have not been followed. Note that 49 CFR 40.121, as amended, requires MROs to be re-qualiÏied and tested every Ïive years. Module 2.19: Drug and Alcohol Testing and Drug-Free Workplace Act Programs LEVEL II - PAGE II-245
ReporÆ ng - Annual Calendar Year Management InformaÆ on System (MIS) FTA recipients and subrecipeints prepare and maintain a summary of the results of their anti-drug and alcohol misuse testing programs performed during the previous calendar year. Subrecipients and the state must prepare, maintain, and submit to FTA annual MIS reports and collect, maintain, and submit annual MIS reports for S. 5307, 5309, and 5311 subrecipients, contractors, subcontractors, and lessees with safety sensitive employees summarizing drug and alcohol program testing results. The reports cover the prior calendar year. The MIS reports must be submitted to the FTA OfÏice of Safety and Security or its designated agent by March 15 following the calendar year for which the reports were prepared. While paper reports are still accepted, FTA strongly encourages grantees to submit via the Internet at http://damis.dot.gov. Subrecipients generally upload their MIS reports to the federal site but the state DOT is responsible for reviewing and approving these reports before they are submitted. Drug-Free Workplace Act (DFWA) Policy and Program Grantees that receive an award directly from a federal agency are required to maintain a drug-free workplace for all employees and to have an ongoing drug-free awareness program. The drug-free workplace requirements do not apply to subrecipients. The state (and other direct recipients) is required to have and distribute to transit related employees a written policy that states that the workplace is drug-free and that it prohibits the unlawful manufacture, distribution, dispensing, possession, or use of a controlled substance in the workplace. The state must notify employees that they must abide by the terms of the policy statement as a condition of employment. The state is required to inform all employees that, if convicted of a drug statute violation that occurred in the workplace, they are to report it to the employer in writing no later than Ïive calendar days after such a conviction. The DFWA policy can be in the FTA Drug and Alcohol Testing Policy as long as it is clearly differentiated and its applicability is extended to all employees, not just safety-sensitive employees. The DFWA requirement applies to employees of a recipient directly engaged in the performance of work under the grant, including both direct and indirect charge employees as well as temporary employees on the recipientâs payroll. If an indirect charge employeeâs impact or involvement in the performance of work under the award is insigniÏicant to the performance of the award, then the requirements do not apply to that employee. The requirements do not apply to volunteers, consultants, or independent contractors Module 2.19: Drug and Alcohol Testing and Drug-Free Workplace Act Programs LEVEL II - PAGE II-246
not on the stateâs payroll, or employees of subrecipients or contractors in covered workplaces. These requirements should not be confused with the FTA Drug and Alcohol Testing Program, which applies only to safety-sensitive employees as well as contractors and subcontractors with safety-sensitive employees. In addition to establishing and maintaining a drug-free workplace environment, the state must establish an ongoing drug-free awareness program that informs employees about the dangers of drug abuse and any available drug counseling, rehabilitation, and employee assistance programs. This information can be distributed periodically and on a general basis to all employees. In some cases, states may rely on an employee assistance program to provide drug-free awareness information. This procedure is acceptable, provided the material includes a drug-free workplace message. TIPS ON RELATIONSHIPS TO OTHER MODULES Drug and alcohol requirements are one set of FTA requirements related to the employees of the stateâs subrecipients and their contracts. Other employment-related modules include Equal Opportunity Employment and Labor Protection/Special Warranty. LINKS/INFO Drug & Alcohol TesÆ ng ⢠49 CFR Part 655 âPrevention of Alcohol Misuse and Prohibited Drug Use in Transit Operationsâ http://www.ecfr.gov/ ⢠49 CFR Part 40 âProcedures for Transportation Workplace Drug Testing Programs http://www.ecfr.gov/ ⢠FTA Drug and Alcohol Testing Homepage. http://transit-safety.fta.dot.gov/DrugAndAlcohol/default.aspx ⢠FTA Drug and Alcohol MIS Reporting. http://transit-safety.fta.dot.gov/DrugAndAlcohol/DAMIS/default.aspx Module 2.19: Drug and Alcohol Testing and Drug-Free Workplace Act Programs LEVEL II - PAGE II-247
⢠FTA Drug and Alcohol Program Compliance Audit Questionnaires. http://transit-safety.fta.dot.gov/DrugAndAlcohol/ TechnicalAssistance/AuditQuestions/default.aspx ⢠FTA Drug and Alcohol Publications. http://transit-safety.fta.dot.gov/Publications/order/default.asp ⢠FTA Drug and Alcohol Regulation Updates Newsletter. http://transit-safety.fta.dot.gov/DrugAndAlcohol/Newsletters/Topics.aspx ⢠FTA Drug and Alcohol Technical Assistance. http://transit-safety.fta.dot.gov/DrugAndAlcohol/TechnicalAssistance/Default.aspx ⢠FTA Drug and Alcohol Training. http://transit-safety.fta.dot.gov/DrugAndAlcohol/Training/Default.aspx ⢠FTA Implementation Guidelines for Drug and Alcohol Regulations in Mass Transit. http://transit-safety.fta.dot.gov/Publications/ order/singledoc.asp?docid=61 ⢠US Department of Health and Human Services CertiÏied Laboratories list. http://workplace.samhsa.gov/DrugTesting/Level_1_ Pages/CertiÏiedLabs.html ⢠US DOT OfÏice of the Secretary Prior Employer Records Release Form. http://www.dot.gov/sites/dot.dev/Ïiles/docs/ODAPC%20 Release%20of%20Information%20Form.pdf ⢠US DOT Public Interest Exclusion (PIE) Overview. http://www.dot.gov/odapc/pie Drug-Free Workplace ⢠49 CFR Part 32 âGovernmentwide Requirements for a Drug-Free Workplace (Financial Assistance) http://www.ecfr.gov/ ⢠US Dept. of Labor DFWP Policy Builder Site. http://www.dol.gov/elaws/asp/drugfree/drugs/screen1.asp Module 2.19: Drug and Alcohol Testing and Drug-Free Workplace Act Programs LEVEL II - PAGE II-248
QUIZ 1. FTA drug and alcohol testing applies to: A. Volunteer drivers who are required to hold CDLs B. Maintenance contractors in rural and small urbanized areas C. Police ofÏicers who patrol public transit facilities 1) A. 2) B. 3) C. 4) All of the above. 2. Subrecipients with safety-sensitive employees must have a drug and alcohol policy that includes, among other elements, a statement that a refusal to take a drug and/or alcohol test constitutes a veriÏied positive test result. 1) True. 2) False. 3. The Drug-Free Workplace Act policy only applies to safety-sensitive employees. 1) True. 2) False. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.19: Drug and Alcohol Testing and Drug-Free Workplace Act Programs LEVEL II - PAGE II-249
Module 2.20: Americans with Disabilities Act (ADA) KEY CONCEPTS ⢠Process for Handling and Resolving Complaints ⢠When Accessible Vehicles Must be Purchased ⢠Accessibility Features in Buses and Vans ⢠Facilities Accessibility ⢠General Service Requirements ⢠Service Requirements SpeciÏic to Fixed-Route ⢠Maintenance of Accessibility Features ⢠Complementary Paratransit Requirements ⢠Intercity Bus Service ⢠Ferry Service INTRODUCTION Titles II and III of the Americans with Disabilities Act of 1990 (ADA) provide that no entity shall discriminate against an individual with a disability in connection with the provision of transportation service. The law sets forth speciÏic requirements for vehicle and facility accessibility and the provision of service, including access to Ïixed route bus and rail and complementary paratransit service. The statute and regulations that spell out the ADA requirements for which FTA has oversight are: ⢠The Americans with Disabilities Act of 1990, as amended (including changes made by the ADA Amendments Act of 2008) ⢠Section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 794) ⢠49 CFR Part 27, âNondiscrimination on the Basis of Disability in Programs or Activities Receiving Federal Financial Assistanceâ ⢠49 CFR Part 37, âTransportation Services for Individuals with Disabilitiesâ ⢠49 CFR Part 38, âAmericans with Disabilities Act (ADA) Accessibility SpeciÏications for Transportation Vehiclesâ ⢠49 CFR Part 39, âTransportation for individuals with Disabilities: Passenger Vesselsâ On October 2, 2012, FTA released a proposed new circular, C 4710.1, âAmericans with Disabilities Act RequirementsâVehicle Acquisition.â At the time this curriculum was drafted, the Ïinal circular had not yet been released. IMPORTANCE FOR STATE DOT STAFF Compliance with ADA requirements and accessibility of FTA-funded transportation services is critical for enabling people with disabilities to live independent, productive lives. In addition to S. 5310, people with disabilities along with seniors make up a signiÏicant portion of the riders of typical S. 5311-funded service. LEVEL II - PAGE II-250
States are responsible for oversight of subrecipient compliance with ADA. When making decisions about which services to fund, states should closely examine the service description with an eye toward service accessibility and ADA compliance. State staff members who develop speciÏications for state-procured vehicles, as well as those who conduct pre-award and post-delivery audits, need to be knowledgeable about ADA standards for vehicle accessibility (49 CFR Part 38 and proposed draft FTA circular 4701.1). The ADA regulations are complex, particularly when ADA complementary paratransit is required. State transit programs have an important role in helping subrecipients get the training and technical assistance they need to be fully compliant. DEFINITIONS Accessible: with respect to vehicles and facilities, complying with the accessibility requirements of parts 37 and 38 of title 49 of the U.S. Code. As a general term, accessible is used to describe services, equipment, and facilities that people that disabilities are able to use or access. Bus: any of several types of self-propelled vehicles, generally rubber-tired, intended for use on city streets, highways, and busways, including but not limited to minibuses, forty- and thirty-foot buses, articulated buses, double-deck buses, and electrically powered trolley buses, used by public entities to provide designated public transportation service and by private entities to provide transportation service including, but not limited to, speciÏied public transportation services. Self-propelled, rubber-tired vehicles designed to look like antique or vintage trolleys are considered buses. Commuter Bus Service: Ïixed route bus service, characterized by service predominantly in one direction during peak periods, limited stops, use of multi-ride tickets, and routes of extended length, usually between the central business district and outlying suburbs. Complementary Paratransit: comparable transportation service required by the ADA for individuals with disabilities who are unable to use Ïixed route transportation systems. Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-251
Demand Responsive Service or System: any system of transporting individuals, including the provision of designated public transportation service by public entities and the provision of transportation service by private entities, including but not limited to speciÏied public transportation service, which is not a Ïixed route system. Disability: with respect to an individual, a physical or mental impairment that substantially limits one or more of the major life activities of such individual; a record of such an impairment; or being regarded as having such an impairment. (1) The phrase physical or mental impairment meansâ (i) Any physiological disorder or condition, cosmetic disÏigurement, or anatomical loss affecting one or more of the following body systems: neurological, musculoskeletal, special sense organs, respiratory including speech organs, cardiovascular, reproductive, digestive, genito-urinary, hemic and lymphatic, skin, and endocrine; (ii) Any mental or psychological disorder, such as mental retardation, organic brain syndrome, emotional or mental illness, and speciÏic learning disabilities; (iii) The term physical or mental impairment includes, but is not limited to, such contagious or noncontagious diseases and conditions as orthopedic, visual, speech, and hearing impairments; cerebral palsy, epilepsy, muscular dystrophy, multiple sclerosis, cancer, heart disease, diabetes, mental retardation, emotional illness, speciÏic learning disabilities, HIV disease, tuberculosis, drug addiction and alcoholism; (iv) The phrase physical or mental impairment does not include homosexuality or bisexuality. (2) The phrase major life activities means functions such as caring for oneâs self, performing manual tasks, walking, seeing, hearing, speaking, breathing, learning, and work. (3) The phrase has a record of such an impairment means has a history of, or has been misclassiÏied as having, a mental or physical impairment that substantially limits one or more major life activities. (4) The phrase is regarded as having such an impairment meansâ Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-252
(i) Has a physical or mental impairment that does not substantially limit major life activities, but which is treated by a public or private entity as constituting such a limitation; (ii) Has a physical or mental impairment that substantially limits a major life activity only as a result of the attitudes of others toward such an impairment; or (iii) Has none of the impairments deÏined in paragraph (1) of this deÏinition but is treated by a public or private entity as having such an impairment. (5) The term disability does not includeâ (i) Transvestism, transsexualism, pedophilia, exhibitionism, voyeurism, gender identity disorders not resulting from physical impairments, or other sexual behavior disorders; (ii) Compulsive gambling, kleptomania, or pyromania; (iii) Psychoactive substance abuse disorders resulting from the current illegal use of drugs. Facility: all or any portion of buildings, structures, sites, complexes, equipment, roads, walks, passageways, parking lots, or other real or personal property, including the site where the building, property, structure, or equipment is located. Fixed Route Service or System: a system of transporting individuals (other than by aircraft), including the provision of designated public transportation service by public entities and the provision of transportation service by private entities, including, but not limited to, speciÏied public transportation service, on which a vehicle is operated along a prescribed route according to a Ïixed schedule. Intercity Bus Service: regularly scheduled bus service for the general public that operates with limited stops over Ïixed routes connecting two or more urban areas not in close proximity, that has the capacity for transporting baggage carried by passengers, and that makes meaningful connections with scheduled intercity bus service to more distant points, if such service is available. Operates: with respect to a Ïixed route or demand responsive system, the provision of transportation service by a public or private entity itself or by a person under a contractual or other arrangement or relationship with the entity. Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-253
Over-the-Road Bus (OTRB): a bus characterized by an elevated passenger deck located over a baggage compartment. Private Entity: any entity other than a public entity. Public Entity: 1) any state or local government; 2) any department, agency, special purpose district, or other instrumentality of one or more state or local governments; and 3) the National Railroad Passenger Corporation (Amtrak) and any commuter authority. Service Animal: any guide dog, signal dog, or other animal individually trained to work or perform tasks for an individual with a disability, including, but not limited to, guiding individuals with impaired vision, alerting individuals with impaired hearing to intruders or sounds, providing minimal protection or rescue work, pulling a wheelchair, or fetching dropped items. University Transportation Systems: operated by public or private institutions of higher education. In order for routes operated by a transit provider to be considered university transportation services, an institution of higher education would have to have a formal arrangement with the transit operator. Vanpool: a voluntary commuter ridesharing arrangement, using vans with a seating capacity greater than 7 persons (including the driver) or buses, which provides transportation to a group of individuals traveling directly from their homes to their regular places of work within the same geographical area, and in which the commuter/driver does not receive compensation beyond reimbursement for his or her costs of providing the service. Wheelchair: a mobility aid belonging to any class of three or more-wheeled devices, usable indoors, designed or modiÏied for and used by individuals with mobility impairments, whether operated manually or powered. DETAILS ON FTA REQUIREMENTS ADA prohibits discrimination against people with disabilities in the areas of employment, public services including transportation, public accommodations including services operated by private entities, and telecommunications. This civil rights law sets forth Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-254
speciÏic requirements for public transportation services, vehicle and facility accessibility, and the provision of complementary paratransit service, as well as overall requirements for a complaint process, codiÏied by U.S. DOT in 49 CFR Part 37. Related RegulaÆ ons The U.S. Architectural and Transportation Barriers Compliance Board (commonly known as the Access Board) develops and maintains the accessibility design criteria on which the U.S. DOT regulations are based, including the ADA Accessibility Guidelines (ADAAG) for Vehicles (codiÏied as 49 CFR Part 38), the ADA and Architectural Barrier Acts (ABA) Accessibility Guidelines (ADA-ABA Guidelines) for Buildings and Facilities, and Guidelines for Pedestrian Facilities in the Public Right-of-Way (currently under development). FTA recipients are also subject to the requirements of Section 504 of the Rehabilitation Act of 1973 (29 USC 794), codiÏied by U.S. DOT in 49 CFR Part 27, which prohibits discrimination against people with disabilities under any program or activity receiving federal Ïinancial assistance. Process for Handling and Resolving Complaints Subrecipients with 15 or more employees must have a process to resolve disability-related complaints from the public. Under 49 CFR 27.13, this process must âincorporate appropriate due process standards and provide for the prompt and equitable resolution of complaints alleging any action prohibited by this part.â When Accessible Vehicles Must be Purchased ADA requirements vary for public and private entities, as well as whether a vehicle is to be used in Ïixed route or demand-responsive operations. However, all FTA subrecipients are subject to the requirements for public entities (even if the subrecipient is a private entity) for their FTA-funded services. Also, public entities which contract out service operations to private entities are still subject to the requirements for public entities. In this case, the private contractor would be considered âstanding in the shoes ofâ the public entity. Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-255
Public EnÆ Æ es Fixed route services - All new buses and vans purchased or leased by public entities operating Ïixed route service must be accessible (complying with 49 CFR Part 38 standards). Demand responsive services - Public entities operating demand-responsive service for the general public must purchase or lease accessible vehicles unless it can be demonstrated that the system, when viewed in its entirety, provides a level of service to persons with disabilities, including persons who use wheelchairs, that is equivalent to the level of service it provides to persons without disabilities. (Demand-responsive service for the general public does not include ADA complementary paratransit service, which is subject to speciÏic requirements described later in this module). As speciÏied in 49 CFR 37, § 37.77, the service for the general public must be provided in the most integrated setting feasible and be equivalent with respect to: ⢠Response time ⢠Fares ⢠Geographic service area ⢠Hours and days of service ⢠Restrictions or priorities based on trip purpose ⢠Availability of information and reservation capability ⢠Constraints on capacity or service availability Before procuring any non-accessible vehicle for demand-responsive service, the entity must Ïile an equivalent service certiÏication with FTA. Some states only allow subrecipients to purchase vehicles that are ADA accessible. If your state allows S. 5311 subrecipients to use FTA funds to buy non-accessible vehicles for use in demand responsive service, you much obtain these certiÏications from your subrecipients. Appendix C to 49 CFR Part 37 of the DOT ADA regulations includes a copy of the certiÏication of equivalent service. Grant applicants should signify that they have Ïiled certiÏications of equivalent service by checking the appropriate certiÏication of the annual certiÏications and assurances. Each subrecipient should monitor its service to ensure that people with disabilities have Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-256
equal opportunity to use the transportation service as people without and document its monitoring activities and the basis of its determination. The state should monitor the subrecipients. Vanpool systems operated by public entities or in which public entities own, purchase, or lease the vehicles are subject to equivalent service requirements. A vehicle that an individual with disabilities can use must be made available to and used by a vanpool in which such an individual chooses to participate. Private EnÆ Æ es As stated in 49 CFR Part 37, §37.23, when a public entity enters into a contractual or other arrangement (including, but not limited to, a grant, subgrant, or cooperative agreement) or relationship with a private entity to operate Ïixed route or demand responsive service, the public entity shall ensure that the private entity meets the requirements of this part that would apply to the public entity if the public entity itself provided the service. Although private entities have different requirements regarding acquisition of accessible vehicles, as detailed in 49 CFR Part 37, Subpart H for over-the-road buses (OTRBs) and in Subpart E for other types of vehicles, §37.23 makes it clear that FTA subrecipients that are private entities cannot provide a lower level of accessibility for FTA-funded service than public entities are required to provide. Proposed Circular FTA C 9040.1G - Formula Grants for Rural Areas: Program Guidance and Application Instructions (released as a draft for public comment shortly before this curriculum was completed) indicates in the Intercity Bus chapter that vehicles used to provide intercity bus service by a public entity or under contract to a public entity must be accessible (p. VIII-8). States are responsible for oversight of their subrecipients, and for ensuring that vehicles operated under a contractual arrangement or FTA-funded grant agreement (or purchased with FTA grant funds) meet the accessibility standards that apply to public entities. Oversight of private entities beyond the FTA-funded portion of their service is not the purview of FTA. Private entities, whether or not they receive federal Ïinancial assistance, are subject to enforcement action as provided in the regulations of the Department of Justice implementing Title III of ADA (28 CFR part 36). Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-257
Accessibility Features in Buses and Vans This summary addresses the physical features to be installed in vehicles, which are detailed in 49 CFR Part 38. Requirements for operating policies and practices that make use of these features are described under âGeneral Service Requirements.â ⢠Accessible Entry â A lift or ramp is needed to enable someone who cannot climb stairs in getting from the sidewalk to the interior of the vehicle, such as someone who uses a wheelchair or walker. For lifts, the platform dimensions and load must meet minimum standards under 49 CFR Part 38. For ramps, the dimensions must meet maximum slope and minimum load speciÏications. Both lifts and ramps have requirements for surface materials, handrails, and raised edges for safety as well as threshold clearances. ⢠Doors, Steps, and Thresholds also have requirements for slip resistance, color contrast, and door height. ⢠Space for Maneuvering â There must be adequate clearances at the boarding location and through the aisle for a person using a common wheelchair to get to the securement locations. This includes positioning the farebox so that it does not obstruct trafÏic in the vestibule. ⢠Securement Areas â There must be at least one securement area for vehicles less than 22 feet in length and at least two securement areas in larger vehicles. Securement locations must meet minimum dimensions, and in vehicles 22 feet or greater, at least one must be forward-facing. Securement areas may have fold-down seats to accommodate other passengers when a wheelchair or mobility aid is not occupying the area. ⢠Securement Device â The regulations specify minimum design load based on the gross vehicle weight rating of the vehicle, and the securement device must limit movement of the mobility aid to two inches or less under normal operating conditions. ⢠Seat Belt and Shoulder Harness â In addition to the securement system for the wheelchair, each securement must have a seltbelt and shoulder harness to secure to a person. The seatbelt is to be used in addition to, never in lieu of, the securement device. Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-258
⢠Priority Seating â Vehicles must contain signage indicating that seats in the front of the vehicle, including at least one set of forward-facing seats, are priority seats for persons with disabilities, and that other passengers should make such seats available to those who wish to use them. Such signage must be posted at the securement location. This signage must meet character accessibility standards as designated in 49 CFR Part 38. ⢠Interior Circulation, Handrails, and Stanchions â The regulations indicate design standards for interior clearances as well as support rails and poles. ⢠Lighting â Lighting standards are indicated for stairways and doorways. In addition, some vehicles to be operated in Ïixed-route service must include the following additional equipment: ⢠Public Information System â All vehicles to be used in Ïixed-route service must have an onboard public address system for stop announcements. ⢠Stop Request System â Vehicles longer than 22 feet used in multiple stop service must provide controls adjacent to the securement area for requesting stops and alerting the driver that a mobility aid user wishes to disembark. Auditory and visual indications that the request has been made are required. ⢠Destination and Route Signs â Vehicles which display exterior route and designation information must meet accessibility requirements for lighting and character dimensions as detailed in the regulations. FaciliÆ es Accessibility Any new facility to be used in providing public transportation services must be accessible according to the standards referenced in 49 CFR 37.9 and Subpart C to 49 CFR Part 37. If the entity alters an existing facility used to provide public transportation, the altered portions of the facility must be accessible. When the nature of an existing facility makes it impossible to comply fully with applicable accessibility standards, the alterations must be made accessible to the maximum extent feasible. 49 CFR 37.43(b) deÏines âto the Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-259
maximum extent feasibleâ as âthe occasional case where the nature of an existing facility makes it impossible to fully comply with applicable standards through a planned alteration.â If the area being altered contains a primary function, such as a station platform, the path of travel to the altered area and the bathrooms, telephones, and drinking fountains is required to be made accessible; unless the costs are disproportionate to the alteration, in which case whatever is not disproportionate must be made accessible. The regulations deÏine âdisproportionateâ as exceeding 20 percent of the cost of the alteration to the area containing the primary function. The regulations provide guidance to deÏine disproportionate costs, specify what costs may be counted, and provide a priority listing for accessibility features. An entity must have documentation sufÏicient to support that it has made the facility accessible to the maximum extent feasible or that alterations required but not made to the path of travel were disproportionate to the overall alterations in terms of cost and scope. Passenger vessel operators are required to ensure that terminal facilities are readily accessible to and usable by individuals with disabilities, including wheelchair users, by meeting the requirements speciÏied under and referenced Bus Stop Accessibility: Each bus stop location should be chosen such that, to the maximum extent practicable, the area where a lift or ramp is to be deployed is accessible. Further, any bus stop improvements (i.e., installation of a shelter, landing pad/sidewalk) must meet ADA standards for accessibility. In order for a bus stop to be accessible to a customer in a wheelchair, it must have a Ïirm, stable, level landing surface at least eight feet deep (measured from the curb perpendicular to the street) and Ïive feet wide (measured along the curb parallel to the street). In addition, accessible pedestrian connections (including sidewalks and curb cuts) between the bus stop and nearby destinations are essential for full customer access. Subrecipients that undertake physical improvements to a stop location (such as the construction of a boarding area or sidewalk, or installation of a shelter) must ensure that the improved bus stop meets these minimum standards. If a subrecipient desires simply to post a bus stop sign to an existing pole, or place a pole in the ground on which to afÏix a bus stop sign (i.e., establish a new stop that does not involve construction of a sidewalk, shelter, landing pad, etc.), then the stop does not need to be made accessible. However, as a best practice, it is strongly recommended that, to the extent possible given existing pedestrian infrastructure, an accessible location should be chosen for any newly established stops that do not involve construction. Otherwise, placing a bus stop pole in the ground could create an additional paratransit obligation if the lift or ramp canât be deployed at that stop. Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-260
in 49 CFR 37.9. There must also be an accessible route between the main terminal or other passenger waiting area and the boarding ramp or device used for the vessel. When a facility is altered, the altered portion must meet the same standards that would apply to a new facility. States must ensure that subrecipients comply with ADA requirements when constructing or altering a facility. If there are parties other than the state or subrecipients responsible for portions of the facility, the state must ensure that they also comply with the ADA requirements. General Service Requirements DOT ADA regulations (49 CFR 37.161-167) detail speciÏic general service requirements that apply across modes. The state must monitor subrecipients for compliance with applicable ADA service provision and training requirements. Service animals. An entity must allow service animals to accompany individuals with disabilities in vehicles and facilities. The DOT ADA regulations deÏine a service animal as any animal individually trained to work or perform tasks for an individual with a disability, including but not limited to, guiding individuals with impaired vision, alerting individuals with impaired hearing to intruders or sounds, providing minimal protection or rescue work, pulling a wheelchair, or fetching dropped items. It is discriminatory to require a person with a disability to certify or register a service animal. Policies or practices that have the effect of limiting service animal use are prohibited. An entity may not require passengers to make prior arrangements when boarding a Ïixed route vehicle with a service animal. Lift deployment. The entity must deploy lifts or ramps for persons who do not use wheelchairs, including standees. Transporting of wheelchairs. Transit providers must carry any wheelchair and occupant if the lift and vehicle can physically accommodate them, unless doing so is inconsistent with âlegitimate safety requirements.â Legitimate safety requirements include such circumstances as a wheelchair of such size that it would block an aisle; however, they explicitly do not include circumstances under which a transit operator may Ïind it difÏicult or impossible to secure a passengerâs wheelchair to its satisfaction. Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-261
Wheelchair securement. DOT ADA regulations do not require that wheelchairs be secured; however, entities may establish policies requiring passengers to allow their mobility devices to be secured on buses and vans and may deny service if a passenger refuses. Entities must transport passengers when the securement system cannot accommodate the riderâs wheelchair. Entities may not establish requirements concerning wheelchair equipment or speciÏications, such as brakes, footrests, or wheel locks. Segways. ADAâs provisions for lift and securement use speciÏic to wheelchairs (§37.165(a) â (e)) do not apply to segways and their users. However, §37.165(g) requires transit providers Wheelchair redeÏined: Historically, the ADAAG for vehicles was based on the former U.S. DOT deÏinition of âcommon wheelchair,â which was deÏined as a mobility aid belonging to any class of three or four-wheeled devices, usable indoors, designed for and used by individuals with mobility impairments, whether operated manually or powered that does not exceed 30 inches in width and 48 inches in length measured two inches above the ground, and does not weigh more than 600 pounds when occupied. The design of wheelchairs and other mobility devices has evolved over time and there are many more variations in use than there were when ADA was initially codiÏied. Today, people with disabilities use a wide variety of non-traditional mobility devices, including scooters, wheelchairs with as many as six wheels, larger and heavier wheelchairs, and wheeled walkers, and transportation providers are obligated to accommodate them if, essentially, they Ïit on the vehicle and do not obstruct the aisle or pose a âdirect threatâ to the safety of others on the vehicle. In 2011, amendments to ADA (49 CFR, Parts 37 and 38) replaced the deÏinition of common wheelchair with simple wheelchair, deÏined as âa mobility aid belonging to any class of three- or more-wheeled devices, usable indoors, designed or modiÏied for and used by individuals with mobility impairments, whether operated manually or powered.â Further, these amendments now require transportation providers to carry a wheelchair and its user, as long as the lift can accommodate the size and weight of the wheelchair and its user, and there is space for the wheelchair on the vehicle. It is helpful for state transit staff to be aware of this change since their subrecipients may still be operating vehicles and lifts that were manufactured to meet the minimum standards for the âcommon wheelchair,â and may not yet have updated their operating policies to reÏlect the requirement to accommodate larger and heavier wheelchairs if their equipment is capable of doing so. Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-262
to âpermit individuals with disabilities who do not use wheelchairsâ to use a vehicleâs lift or ramp to enter the vehicle. Under this provision, an individual with a disability who uses a segway as a mobility device must be permitted to use the lift. Public information. Public information and communications must be made available in accessible formats. This includes provision of audio and large print formats for persons with vision impairments, or electronic formats that can be made accessible by screen reader technology. The availability of braille is not speciÏically required, although it may be recommended if so requested by customers. Service to persons using respirators or portable oxygen. Entities may not deny service to individuals using respirators or portable oxygen. Training. ADA requires that each Ïixed route or demand-responsive service operator ensure that personnel are trained to proÏiciency, as appropriate, for their duties. This training is required so that personnel operate vehicles and equipment safely, assist passengers properly, and treat persons with disabilities who use the service in a respectful and courteous way, with appropriate attention to the differences among persons with disabilities. The DOT ADA regulations do not specify an acceptable course or frequency of training. The entity must establish appropriate standards for its particular operation. There is no requirement for recurrent or refresher training, but there is an obligation to ensure that each employee is proÏicient at all times. The training must be appropriate to the duties of each employee and must address both technical requirements and human relations. Service Requirements Specifi c to Fixed Route Lift deployment. Entities must not refuse to permit a passenger who uses a lift or ramp to board or disembark from a vehicle at any designated stop, unless the lift or ramp cannot be deployed, the lift or ramp will be damaged if it is deployed, or temporary conditions preclude the safe use of the stop by all passengers (i.e., the stop is âclosedâ for the duration of such conditions). Priority seating. Vehicles used in Ïixed route service shall have signs designating priority seating for elderly persons and persons with disabilities. When an individual with a disability needs to sit in a seat or occupy a wheelchair securement location, the entity shall ask the following persons to move in order to allow the individual with a disability to occupy the seat or securement location: (i) individuals, except other individuals with a disability or elderly persons, sitting in a location designated as priority seating for elderly Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-263
persons and persons with disabilities (or other seat as necessary); and (ii) individuals sitting in a fold-down or other movable seat in a wheelchair securement location. The entity is not required to enforce the request, but is not prevented from adopting a policy requiring people to move. Stop announcements. Stop announcements are required for Ïixed route service at transfer points, major intersections, destination points, intervals along the route to orient passengers, and any stop upon request. The ADA supersedes any union agreement that prevents the entity from requiring operators to call stops. These announcements are made to passengers on board the vehicle. In addition, there is a requirement to assist individuals waiting at bus stops in knowing which bus to board. When more than one route serves a stop, the entity shall provide a means by which an individual with a visual or other disability can identify the route on which he or she wants to travel. Maintenance of Accessibility Features The state is responsible for ensuring subrecipient maintenance of ADA accessibility features for vehicles, facilities, and facility-related equipment used in public transportation service, even if the assets were not purchased or constructed with FTA funds. ADA has speciÏic requirements for vehicle maintenance and operations. Entities must have a system of regular and frequent maintenance checks for wheelchair lifts and ramps on non-rail vehicles that is sufÏicient to ensure that the lifts are operative. There is no speciÏic requirement for daily cycling of lifts and ramps, though many entities have adopted this practice to meet the requirement. The adequacy of the procedures may be reÏlected in the frequency of in- service failures. FTA does not prescribe a monitoring system or speciÏic monitoring activities. Each state is responsible for developing and implementing a monitoring system that provides adequate assurance that ADA features are maintained in operative condition. Most states use a combination of monitoring mechanisms: periodic reporting, maintenance record review, visual inspections, and maintenance audits. Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-264
Maintenance Requirement Specifi cally for Fixed Route Service Public entities and private entities operating service under contract to a public entity must ensure that operators report immediately any in-service lift and ramp failures. If a lift or ramp failure occurs on a route where the headway is greater than 30 minutes and the passenger cannot be served, the entity is required to provide alternative service within 30 minutes. The vehicle must be removed from service before the beginning of the next service day if the lift or ramp is not repaired. The lift or ramp should be repaired before the vehicle is returned to service. In the event that there is no spare vehicle available and the entity would be required to reduce service to repair the lift or ramp, it may keep the vehicle with the inoperable lift or ramp in service for no more than three days (if the entity serves an area of more than 50,000 persons in population) or Ïive days (if the entity serves an area of 50,000 persons or fewer in population). Complementary Paratransit Requirements The state must monitor subrecipients that provide complementary paratransit service for compliance with applicable ADA requirements. Each public entity operating a Ïixed route system must provide paratransit or other special service to individuals with disabilities that is comparable to the level of service provided to individuals without disabilities who use the Ïixed route system. All S. 5311 subrecipients operating public Ïixed route service, including private non-proÏit entities, must comply with this requirement as they operate the service on behalf of the grantee (the state), a public entity. The requirement to provide complementary paratransit service does not apply to intercity bus, commuter bus and rail, or university service. Route DeviaÆ on Service Many rural and small urban transit systems provide route deviation service instead of traditional Ïixed route service. In terms of ADA, FTA generally categorizes route deviation service as demand response, and thus no ADA complementary paratransit service (described later in this module) is required. To determine if a transit service is Ïixed route or demand-responsive, two key factors must be considered: Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-265
⢠Whether or not an individual must request the service in some way, typically by making a phone call in advance. With Ïixed route service, no action is needed to access the serviceâif a person is at the bus stop at the time the bus is scheduled to appear, then the person can use that service. In contrast, with demand-responsive service, the individual typically must make a phone call in order to ride the bus. A system that permits user-initiated deviations from routes generally Ïits the deÏinition of demand- responsive service. ⢠Whether the service deviates for the general public, or just persons with disabilities. If deviations are restricted to a particular group, the service ceases to be a form of demand-responsive service for the general public. Systems should provide information to the public on how to request a deviation. The service for persons with disabilities must be equivalent to the service for the general public as speciÏied in 49 CFR 37.77. The state must ensure that route deviation service provided by subrecipients has the characteristics of demand-responsive service. If they do not have these characteristics, the state must ensure that that subrecipient fulÏills its obligation to provide ADA complementary paratransit. Eligibility DeterminaÆ ons Each entity providing ADA complementary paratransit service is required to establish a process for determining eligibility. Determination Categories. FTA strictly limits eligibility to certain categories of individuals: 1. Any person with a disability who is unable to board, ride, or disembark from an accessible vehicle without the assistance of another person (except for the operator of a lift or other boarding device). 2. Any person with a disability who could ride an accessible vehicle but the route is not accessible or the lift does not meet ADA standards. 3. Any person with a disability who has a speciÏic impairment related condition that prevents the person from traveling to or from a boarding/disembarking location. Individuals may be ADA paratransit eligible on the basis of a temporary or permanent disability. Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-266
Determination Process. There are many ways that the entity can determine eligibility. The process may include functional evaluation or testing of applicants. Evaluation by a physician or health professional may be part of the process, but a diagnosis of a disability in and of itself does not establish eligibility. What is needed is a determination of whether, as a practical matter, the individual can independently use the regular Ïixed route transit service. The goal of the process is to ensure that only persons who meet the regulatory criteria are regarded as eligible for complementary paratransit under ADA. If decisions are based solely on a note from a physician, and 100 percent of applicants are approved, the entity may not have an appropriate process. The entity is not prohibited from providing service to other persons; however, the eligibility process must distinguish between someone who is eligible for paratransit under the ADA and someone who is provided service on some other basis. There is a legal obligation to meet the demand for service by those individuals required to be served. Thus, if the entity is encountering difÏiculty with its ability to meet the demand for service due to liberal eligibility criteria, a more rigorous certiÏication process may be needed to ensure the entity can meet the demand of FTA-deÏined eligible individuals. Process Timeline. The entity must process a completed application within 21 days of submittal. If after 21 days, the entity has not made an eligibility determination, the applicant is presumed eligible and must be provided service unless the entity later denies the application. RecertiÏication. The entity may require passengers to be recertiÏied at reasonable intervals. Conditional Eligibility. Transit systems can allow conditional eligibility for those individuals who meet the criteria for some of their travel but not all of their travel. Conditional eligibility must account for all factors that may prevent a given individual from using the regular accessible Ïixed route system. In many cases, conditional eligibility will be required based on environmental conditions, such as when snow prevents a wheelchair user from traveling to and from a bus stop. However, the process must also recognize that there may be trip-speciÏic conditions that prevent an individual from using the Ïixed-route system as well. For example, a wheelchair user may be able to use the Ïixed route system for regular travel between home and work, but may require paratransit service when traveling to areas where a lack of pedestrian infrastructure prevents him or her from reaching a bus stop. This individual would therefore be eligible for paratransit service for trips to and from those areas. Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-267
Determination Provided in Writing. The applicant must be given a written reason for the determination and notice of the right to an appeal. As explained in Appendix D to 49 CFR 37.125, a mere recital that the applicant can use Ïixed route transit is not sufÏicient. The reasons for denial must speciÏically relate the evidence in the matter to the eligibility criteria. Appeals Process. The entity is required to establish an appeals process for persons denied eligibility or granted conditional eligibility. Applicants should be required only to submit to the grantee their intent to appeal, not be required to give a full justiÏication in writing prior to an opportunity to be heard. The entity may require that an appeal be Ïiled within 60 days of the denial of a personâs application. The process must include an opportunity to be heard and to present information. The person hearing the appeal must be separate from the person who made the original decision to deny eligibility. The entity is not required to provide ADA complementary paratransit service pending the determination of the appeal, but if the decision takes longer than 30 days after completing the appeals process, paratransit service must be provided from that time until a decision to deny the appeal is issued. A written notiÏication of an appeal determination, with the reason for it, is also required. Visitorsâ Service. Service must be provided to visitors. Any visitor who presents ADA eligibility documentation from another jurisdiction must be provided service. If a visitor does not have ADA eligibility documentation, the entity may request proof of residency, and if the disability is not apparent, proof of disability. The entity must accept a certiÏication by the visitor that he or she is unable to use Ïixed route transit. The entity is not required to provide more than 21 days of service within a 365-day period. It may request that the visitor apply for eligibility in order to receive additional service beyond this number of days. Service Criteria DOT ADA regulations include detailed requirements for provision of ADA complementary paratransit. These requirements include: Origin-to-Destination Service. The regulations specify âorigin-to-destinationâ service. If an entityâs basic mode of service is curb to curb (rather than door to door), the entity must have policies and procedures in place to provide assistance from the vehicle to the Ïirst doorway for customers who need additional assistance to complete the trip. The entity cannot charge individuals needing door to door service an extra fee as this violates the nondiscrimination provisions of 49 CFR 37.5. Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-268
Service Area. The ADA service area at a minimum includes all origins and destinations within corridors ¾-miles from each Ïixed route. Within the core service area, any small areas not inside a corridor but surrounded by corridors also must be served. Outside the core service area, the entity may designate corridors with widths of up to 1½ miles on each side of the Ïixed route, based on local circumstances. For rail systems (except commuter rail), the service area consists of a circle with a radius of ¾-miles around each rail station, for trips provided between origins and destinations in different station service areas. At end stations, the entity may designate circles up to 1½ miles. The entity is not required to provide paratransit service in areas it does not have the legal authority to operate. The entity may provide additional service. Service Time. The days and hours of service for Ïixed route service and ADA complementary paratransit service must be the same. Trips must be scheduled within a maximum of one hour of the requested pickup time. Response Time. Requests for reservations must be accepted during normal business hours on a ânext dayâ basis (as distinguished from 24 hours in advance) on all days prior to days of service (e.g., weekends, holidays). Reservations for next day service must be taken during administrative ofÏice hours. On days prior to a service day on which the administrative ofÏices are not open at all (e.g., a Sunday prior to a Monday service day), the reservation service would also be open 9 to 5. Reservations can be accepted using mechanical means (e.g., answering machines, voice mail, internet). Trip Purpose. No restrictions or priorities may be placed on trip purpose. Fares. ADA complementary paratransit fare cannot exceed twice the non-discounted fare for a trip of similar length, at a similar time of day, on the Ïixed-route system. Who May Ride with the Eligible Individual. ADA complementary paratransit must be provided to an ADA eligible individual, a Personal Care Attendant (PCA) if one is necessary, and one other individual accompanying the ADA eligible individual, if requested. Additional companions should be provided service if space is available. No fare may be charged for PCAs. Companions pay the same fare as the ADA eligible individual. Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-269
Service Capacity DOT ADA regulations specify that an entity may not limit the availability of complementary paratransit to eligible individuals by restrictions. Any operational pattern or practice that has the effect of limiting availability is also prohibited (e.g., limited phone reservation capacity, substantial numbers of late pickups, trip denials, missed trips, or excessively long trips). If on a regular basis, the phone lines are busy, average or long phone hold times are excessive, call abandonment rates are high, or callers after a certain time (e.g., mid-morning) are told that they cannot reserve trips for the next day, the grantee is limiting the availability of service. Grantees also must ensure that an ADA eligible individual can reach a reservation agent to cancel a trip. Grantees should be able to provide data on the performance of its phone reservation system. Grantees may not limit the number of reservations made during a phone call. Limits on the number of reservations in a phone call are a capacity constraint. The regulations allow grantees to negotiate pickup times with ADA eligible persons within a one-hour +/- window. If the grantee cannot schedule a ride that is within one hour before or after the desired departing time, the trip must be tracked as a denial. Even if a rider accepts an offer of a trip that is outside the one hour window, the trip must be tracked as a denial due to the entityâs inability to meet the ADA service criteria. Similarly, if only one leg of a round trip can be reserved, and the rider declines the trip, it must be tracked as two denials. If the rider refuses an alternate time that is within the one-hour window, it is not a denial for the purposes of ADA compliance. Paratransit service is by nature a shared ride service that is intended to provide a level of service comparable to that of the Ïixed route system. A paratransit trip should be comparable in length to an identical trip on the Ïixed route system, including the time necessary to travel to the bus stop, wait for the bus, actual riding time, transfers, and travel from the Ïinal stop to the personâs ultimate destination. âPattern or practiceâ in the regulations refers to regular or repeated actions, such as repeated denials on peak days, not isolated or singular incidents. The regulations note that operational problems beyond the control of the grantee, such as unanticipated weather or trafÏic problems that affect all vehicular trafÏic, do not count as a pattern or practice under this provision. Repeated incidents caused by poor maintenance or excessively tight scheduling, however, would trigger this provision. A substantial number of late arrivals must be signiÏicant in length to trigger this provision. In order to determine whether capacity constraints exist, entities should have a deÏinition of what constitutes a missed trip, what Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-270
on-time performance means, when a trip has been denied, and when travel time is too long. For example, at what point does a trip go from being late to being missed? Entities are required to plan and budget for 100 percent of demand for next day service. Intentionally planning to deny a percentage of trips is not in compliance with ADA requirements. The entity should have a mechanism in place for monitoring its on-time performance and tracking these indicators of capacity constraints. While there is no regulatory requirement for record-keeping or monitoring in any particular way, unless the entity has no trip denials and few complaints about other performance indicators, the entity must be able to demonstrate that the denials it does have, as well as the missed trips, late pickups, etc., are not an operational pattern or practice that signiÏicantly limits the availability of ADA paratransit service. Grantees should track service for ADA eligible trips separately from non-eligible trips. Intercity Bus Service Operators of intercity bus service funded by FTA (under contract to a public entity or in the form of a subrecipient grant) must comply with public entity service requirements. Complementary paratransit service is not required for intercity bus service. As discussed earlier in this module, states should be aware that, beyond FTA-funded service, the ADA has separate bus accessibility requirements for private entities for which U.S. DOJ has oversight responsibility. Private operators of over-the-road buses (OTRB) are subject to the DOT ADA OTRB regulations, at 49 CFR part 37, subpart HâOver-The-Road Buses. Private operators purchasing other types of vehicles are subject to 49 CFR part 37 Subpart EâAcquisition of Accessible Vehicles by Private Entities. All private operators are also subject to applicable accessible service requirements in Subpart GâProvision of Service, including those related to service animals, lift deployment upon request, transporting of wheelchairs, wheelchair securement, adequate accessible public information, and service to persons using respirators or portable oxygen. Fixed route operators must also comply with service requirements related to lift deployment at any Ïixed stop, priority seating, and stop announcements. Operators must be trained to proÏiciency in proper operation and maintenance of accessibility features and equipment, boarding assistance, securement of mobility aids, and sensitivity and appropriate interaction with passengers with disabilities. States are responsible for oversight of the service provided by their FTA subrecipients or under an FTA-funded contract to the state or a subrecipient. U.S. DOT and U.S. DOJ are responsible for oversight of non-FTA-funded service. Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-271
Ferry Service Ferry service is covered by 49 CFR Part 39, âTransportation for Individuals with Disabilities: Passenger Vessels,â effective November 10, 2010. This rule prohibits owners and operators of passenger vessels, including U.S. and foreign-Ïlag vessels, from discriminating against passengers on the basis of disability; requires vessels and related facilities to be accessible; and requires owners and operators of vessels to take steps to accommodate passengers with disabilities. Subpart E, which addresses the accessibility of the vessels themselves, is reserved until the U.S. Architectural and Transportation Barriers Compliance Board issues applicable standards, and such standards are incorporated into the DOT ADA regulations. Accessibility of landside facilities are addressed by Subpart D, and requirements for assistance and services to passengers with disabilities are contained in Subpart F. The state must ensure that the ferry service that it operates or oversees (or is operated or overseen by a subrecipient) complies with the following requirements: a. Passenger vessel operators may not limit the number of persons with disabilities on a vessel, require medical documentation, require advance notice, require a passenger with a disability to travel with another person, subject passengers with disabilities to restrictions that do not apply to other passengers, or impose higher fares, surcharges, or other fees. b. 49 CFR 39.21(b)(2) requires public operators of passenger vessels to make reasonable modiÏications in policies, practices, or procedures when necessary to accommodate individuals with disabilities, unless they can demonstrate that making such modiÏications would fundamentally alter the nature of the service. c. If a passenger vessel operator provides, contracts for, or otherwise arranges for transportation to and from a passenger vessel, the entity must ensure that the transfer service is accessible to and usable by persons with disabilities. d. The entity must provide assistance requested by or on behalf of a passenger with a disability in moving between the terminal entrance or other vehicle drop-off point and the location where passengers board and disembark from the vessel. This includes assistance in accessing key functional areas of the terminal, such as ticket counters and baggage checking/claim areas. Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-272
e. Passenger vessel operators are required to promptly provide assistance to passengers with disabilities who are not able to get on or off a vessel without assistance, and may use any means to which the passenger consents (such as lifts, ramps, boarding chairs or assistance by vessel personnel). However, the entity cannot require a passenger with a disability to accept assistance if he or she is readily able to get on or off of the vessel independently. f. BrieÏings or other safety-related information must be provided through means that effectively communicate their content to persons with vision or hearing impairments, using auxiliary aids and services where necessary. This includes providing written materials in alternative formats that persons with vision impairments can use. Entities must not require any passenger with a disability to demonstrate that he or she has listened to, read, or understood the information presented, unless it is required of all passengers. Passengers with disabilities must be provided with whatever assistance is necessary to enable their full participation in safety or emergency evacuation drills that are provided to all passengers, and maintain evacuation programs, information, and equipment in locations that passengers with disabilities can readily access and use. g. Passenger vessel operators must permit individuals with mobility disabilities to use power and manual wheelchairs and other mobility aids such as walkers, crutches, canes, braces, or similar devices in any areas that are open to pedestrian use. In addition, the entity must also make reasonable modiÏications to its policies, practices, or procedures to permit the use of other powered mobility devices used by persons with mobility impairments (e.g., segways), unless it can be demonstrated that a speciÏic device cannot be operated on board the vessel consistent with legitimate safety requirements. h. Passenger vessel operators are required to make a designated complaints resolution ofÏicial (CRO) available for contact on each vessel and at each terminal. The CRO may be available in person or via telephone. If a telephone link is used, text telephone (TTY) or telecommunications relay service (TRS) must be available so that persons with hearing impairments are able to communicate readily with the CRO. The CRO must have the authority to make dispositive resolution of complaints on the entityâs behalf, including the power to overrule the decisions of any other personnel (though not a decision of the master of the vessel on safety matters). In any situation in which a person complains or raises concern with the entityâs personnel about discrimination, policies, or services with respect to passengers with a disability, and personnel do not immediately resolve the issue to the passengerâs satisfaction or provide a requested accommodation, the entityâs personnel must immediately inform the passenger of the right to contact a CRO and the location and/or phone number of the available CRO. Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-273
SUPPLEMENTAL NOTES If you or your subrecipients need technical assistance on complying with ADA, a great resource is Easter Seals Project ACTION (www. projectaction.org). FTA also provides technical assistance through its toll-free ADA Assistance Line at 1-888-446-4511 [Voice] or by e-mail at FTA.ADAAssistance@dot.gov. The following is a brief orientiation to the structure of 49 CFR Part 37, for individuals who are just being introduced to this extensive set of regulations: ⢠Subpart A addresses the blanket overarching prohibition against nondiscrimination applicability, references other regulations that apply to the physical design of transportation vehicles and facilities, and indicates general enforcement responsibilities, which include the Department of Justice as well as DOT/FTA. ⢠Subpart B addresses applicability. ⢠Subpart C addresses the requirements to make transportation facilities accessible. ⢠Subpart D details the requirements for public entities (as well as their contractors) to purchase accessible vehicles. ⢠Subpart E details the requirements for private entities to purchase accessible vehicles. ⢠Subpart F addresses ADA complementary paratransit requirements to which public entities (and their contractors) operating Ïixed route service are subject. ⢠Subpart G addresses service delivery requirements for Ïixed route and demand response services. ⢠Subpart H details the requirements that apply to OTRB operators. ⢠Appendix A to Subpart H of Part 37 is a form that OTRB operators use to document accessible service requests. ⢠Appendix A to Part 37 describes modiÏications to standards for accessible transportation facilities issued by the Access Board on July 23, 2004. ⢠Appendix B to Part 37 provides the addresses for FTAâs ten Regional OfÏices. ⢠Appendix C to Part 37 provides certiÏication forms. The CertiÏication of Equivalent Service form is the only one state transit staff are likely to use. The other forms pertained to an ADA planning requirement that is no longer actively enforced. ⢠Appendix D to Part 37âConstruction and Interpretation of Provisions is a very helpful resource for understanding the nuances of 49 CFR Part 37. It is intended to be used as deÏinitive guidance concerning the meaning and implementation of these provisions, organized on a section-by-section basis. Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-274
TIPS ON RELATIONSHIPS TO OTHER MODULES The Equal Employment Opportunity module of this curriculum addresses employment discrimination against qualiÏied individuals with disabilities, which is prohibited by ADA. LINKS/INFO ⢠FTA ADA Website: http://www.fta.dot.gov/civilrights/12325.html ⢠Department of Transportation Disability Law Guidance: http://www.fta.dot.gov/12325_3886.html ⢠U.S. Access Board: http://www.access-board.gov/ ⢠Easter Seals Project ACTION: http://www.projectaction.org/ ⢠Disability Rights Education & Defense Fund â Topic Guides on ADA Transportation: http://dredf.org/ADAtg/index.shtml ⢠U.S. Department of Justice ADA Homepage: http://www.ada.gov/ ⢠Federal Highway Administration Guidance on Pedestrian Access for Persons with Disabilities: http://www.Ïhwa.dot.gov/ civilrights/programs/ada.cfm ⢠Proposed new circular, C 4710.1, âAmericans with Disabilities Act RequirementsâVehicle Acquisitionâ: http://www.fta.dot. gov/legislation_law/12349_14860.html Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-275
QUIZ 1) All vehicles purchased using S. 5310 funding must be ADA accessible. 1) True. 2) False. 2) For ADA complementary paratransit, how far in advance can a transit system require advanced reservation? 1) 24 hours 2) One business day 3) One day, with reservations accepted up until close of business the preceding day, including Sunday for Monday service. 4) Two weeks 3) Which of the following statements are true for ADA complementary paratransit? A. A trip that begins and ends within ¾ mile of Ïixed route service would fall within the ADA paratransit service area. B. Passenger fares cannot exceed Ïixed route fares for the same trip. C. Eligible passengers must be allowed to travel with a personal care attendant as well as a companion. D. ADA paratransit passengers can be certiÏied as conditionally eligible for some trips and ineligible for other trips. 1) All of the above. 2) A & B. 3) A, C, and D. 4) None of the above. Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-276
5) FTA-funded service that is operated by a private operator under contract to an FTA recipient or subrecipient must meet the accessibility requirements for public entities. 1) True. 2) False. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.20: Americans with Disabilities Act (ADA) LEVEL II - PAGE II-277
Module 2.21: Title VI KEY CONCEPTS ⢠Title VI Program ⢠Notifying BeneÏiciaries of Protection under Title VI ⢠Title VI Complaint Procedures and Complaint Form ⢠Recording and Reporting Transit-Related Title VI Investigations, Complaints, and Lawsuits ⢠Promoting Inclusive Public Participation ⢠Limited English ProÏiciency (LEP) ⢠Subrecipient Assistance ⢠Subrecipient Monitoring ⢠Title VI and Facilities Planning ⢠Requirements and Guidelines for Fixed Route Transit Providers INTRODUCTION Grantees must ensure that no person shall, on the grounds of race, color, or national origin, be excluded from participating in, or be denied the beneÏits of, or be subject to discrimination under any program or activity receiving federal Ïinancial assistance. The grantee must ensure that federally supported transit services and related beneÏits are distributed in an equitable manner. Applicable statutes and regulations: ⢠Title VI of the Civil Rights Act of 1964 ⢠49 CFR Part 21, âNondiscrimination in Federally-assisted Programs of the Department of TransportationâEffectuation of Title VI of the Civil Rights Act of 1964â ⢠Executive Order 13166: âImproving Access to Services for Persons with Limited English ProÏiciencyâ DOT/FTA Guidance: ⢠FTA C 4702.1B âTitle VI Requirements and Guidelines for Federal Transit Administration Recipientsâ ⢠FTA C 4703.1 âEnvironmental Justice Policy Guidance For Federal Transit Administration Recipientsâ ⢠Federal Register: December 14, 2005 (Volume 70, Number 239, pp. 74087-74100) âDOT Policy Guidance Concerning Recipientsâ Responsibilities to Limited English ProÏiciency (LEP) Personsâ IMPORTANCE FOR STATE DOT STAFF In addition to establishing their own state-wide Title VI programs, LEVEL II - PAGE II-278
states are responsible for oversight of subrecipient compliance with Title VI requirements. States must assist their subrecipients in complying with DOTâs Title VI regulations, including the general reporting requirements. Primary recipients (including states) must monitor their subrecipients for compliance with the regulations. Importantly, if a subrecipient is not in compliance with Title VI requirements, then the primary recipient is also not in compliance. DEFINITIONS Discrimination: any action or inaction, whether intentional or unintentional, in any program or activity of a federal aid recipient, subrecipient, or contractor that results in disparate treatment, disparate impact, or perpetuating the effects of prior discrimination based on race, color, or national origin. Environmental Justice: the fair treatment and meaningful involvement of all people regardless of race, color, national origin, or income with respect to the development, implementation, and enforcement of environmental laws, regulations, and policies. Limited English ProÏicient (LEP) persons: persons for whom English is not their primary language and who have a limited ability to read, write, speak, or understand English. It includes people who reported to the U.S. Census that they speak English less than very well, not well, or not at all. Low-Income Person: a person whose median household income is at or below the U.S. Department of Health and Human Services (HHS) poverty guidelines. Recipients are encouraged to use a locally developed threshold, such as the deÏinition found in 49 U.S.C. 5302 as amended by MAP-21: âan individual whose family income is at or below 150 percent of the poverty line (as that term is deÏined in Section 673(2) of the Community Services Block Grant Act (42 U.S.C 9902(2)), including any revision required by that section) for a family of the size involvedâ or another threshold, provided that the threshold is at least as inclusive as the HHS poverty guidelines. Low-Income Population: any readily identiÏiable group of low-income persons who live in geographic proximity, and, if circumstances warrant, geographically dispersed/transient persons (such as migrant workers or Native Americans) who will be similarly affected by a proposed FTA program, policy, or activity. Module 2.21: Title VI LEVEL II - PAGE II-279
Minority Persons: (1) American Indian and Alaska Native, which refers to people having origins in any of the original peoples of North and South America (including Central America), and who maintain tribal afÏiliation or community attachment. (2) Asian, which refers to people having origins in any of the original peoples of the Far East, Southeast Asia, or the Indian subcontinent, including, for example, Cambodia, China, India, Japan, Korea, Malaysia, Pakistan, the Philippine Islands, Thailand, and Vietnam. (3) Black or African American, which refers to people having origins in any of the Black racial groups of Africa. (4) Hispanic or Latino, which includes persons of Cuban, Mexican, Puerto Rican, South or Central American, or other Spanish culture or origin, regardless of race. (5) Native Hawaiian or Other PaciÏic Islander, which refers to people having origins in any of the original peoples of Hawaii, Guam, Samoa, or other PaciÏic Islands. Minority Population: any readily identiÏiable group of minority persons who live in geographic proximity and, if circumstances warrant, geographically dispersed/transient populations (such as migrant workers or Native Americans) who will be similarly affected by a proposed DOT program, policy, or activity. National Origin: the particular nation in which a person was born, or where the personâs parents or ancestors were born. Service Standard/Policy: an established service performance measure or policy used by a transit provider or other recipient as a means to plan or distribute services and beneÏits within its service area. Title VI Program: a document developed by an FTA recipient to demonstrate how the recipient is complying with Title VI requirements. Direct and primary recipients must submit their Title VI Programs to FTA every three years. The Title VI Program must be approved by the recipientâs board of directors or appropriate governing entity or ofÏicial(s) responsible for policy decisions prior to submission to FTA. For state DOTs, the appropriate governing entity is the stateâs Secretary of Transportation or equivalent. Module 2.21: Title VI LEVEL II - PAGE II-280
DETAILS ON FTA REQUIREMENTS Title VI Program FTA requires that all direct and primary recipients (including states) document their compliance with DOTâs Title VI regulations by submitting a Title VI Program to their FTA regional civil rights ofÏicer once every three years or as otherwise directed by FTA. FTA requires that all subrecipients submit Title VI Programs to the primary recipient from whom they receive funding in order to assist the primary recipient in its compliance efforts. For all recipients and subrecipents, the Title VI Program must be approved by the entityâs board of directors or appropriate governing entity or ofÏicial(s) responsible for policy decisions prior to submission. This approval must be documented by a copy of the board resolution, meeting minutes, or similar documentation. Title VI Programs must include: (1) A copy of the recipientâs Title VI notice to the public that indicates the recipient complies with Title VI, and informs members of the public of the protections against discrimination afforded to them by Title VI. It must list the locations where the notice is posted. (2) A copy of the recipientâs instructions to the public regarding how to Ïile a Title VI discrimination complaint, including a copy of the complaint form. (3) A list of any public transportation-related Title VI investigations, complaints, or lawsuits Ïiled with the recipient since the time of the last submission. This list should include only those investigations, complaints, or lawsuits that pertain to allegations of discrimination on the basis of race, color, and/or national origin in transit-related activities and programs and that pertain to the recipient submitting the report, not necessarily the larger agency or department of which the recipient is a part. Module 2.21: Title VI LEVEL II - PAGE II-281
(4) A public participation plan that includes an outreach plan to engage minority and limited English proÏicient populations, as well as a summary of outreach efforts made since the last Title VI Program submission. A recipientâs targeted public participation plan for minority populations may be part of efforts that extend more broadly to include other constituencies that are traditionally underserved, such as people with disabilities, low-income populations, and others. (5) A copy of the recipientâs plan for providing language assistance to persons with limited English proÏiciency, based on the DOT LEP Guidance (described later in this module). (6) Recipients and subrecipients that have transit-related, non-elected planning boards, advisory councils/committees, or similar bodies, the membership of which is selected by the recipient, must provide a table depicting the racial breakdown of the membership of those committees, and a description of efforts made to encourage the participation of minorities on such committees. (7) Primary recipients must include a narrative or description of efforts the primary recipient uses to ensure subrecipients are complying with Title VI, as well as a schedule of subrecipient Title VI program submissions. (8) If the recipient has constructed a facility, such as a vehicle storage facility, maintenance facility, operation center, etc., the recipient must include a copy of the Title VI equity analysis conducted during the planning stage with regard to the location of the facility. (9) Additional information, depending on whether the recipient is a Ïixed route transit provider, a state, or an MPO. Contractors and subcontractors are responsible for complying with the Title VI Program of the recipient with whom they are contracting. FTA does not require contractors to prepare or submit Title VI Programs. However, recipients are responsible for ensuring that contractors are following the Title VI Program, and complying with Title VI. Module 2.21: Title VI LEVEL II - PAGE II-282
NoÆ fying Benefi ciaries of ProtecÆ on Under Title VI Recipients are required to provide information to the public regarding the recipientâs obligations under DOTâs Title VI regulations and apprise members of the public of the protections against discrimination afforded to them by Title VI. At a minimum, recipients must disseminate this information to the public by posting a Title VI notice on the agencyâs website and in public areas of the agencyâs ofÏice(s), including the reception desk, meeting rooms, etc. Recipients should also post Title VI notices at stations or stops, and/or on transit vehicles. Contents The Title VI notice must include: (1) A statement that the agency operates programs without regard to race, color, or national origin. (2) A description of the procedures that members of the public should follow in order to request additional information on the recipientâs Title VI obligations. (3) A description of the procedures that members of the public must follow in order to Ïile a Title VI discrimination complaint against the recipient. Eï¬ ecÆ ve PracÆ ces for Fulfi lling the NoÆ fi caÆ on Requirement Agencies must inform the public of their rights under Title VI through such measures as posting the Title VI notice on posters, comment cards, or Ïlyers placed at stations, bus shelters, and in transit vehicles. The type, timing, and frequency of these measures are at the recipientâs discretion, as long as the type, timing, and frequency are sufÏicient to notify passengers and other interested persons of their rights under DOTâs Title VI regulations with regard to the recipientâs program. Notices detailing a recipientâs Title VI obligations and complaint procedures must be translated into languages other than English, as needed and consistent with the DOT LEP Guidance and the recipientâs language assistance plan (described later in this module). Module 2.21: Title VI LEVEL II - PAGE II-283
In order to reduce the administrative burden associated with this requirement, subrecipients may adopt the Title VI Notice developed by the primary recipient; however, subrecipients must notify passengers and other interested persons that they may Ïile discrimination complaints directly with the subrecipient. Title VI Complaint Procedures and Complaint Form FTA requires all recipients to develop procedures for investigating and tracking Title VI complaints Ïiled against them and to make their procedures for Ïiling a complaint available to members of the public. Recipients must also develop a Title VI complaint form, and the form and procedure for Ïiling a complaint must be available on the recipientâs website. FTA requires direct and primary recipients to report information regarding their complaint procedures in their Title VI Programs in order for FTA to determine compliance with DOTâs Title VI regulations. In order to reduce the administrative burden associated with this requirement, subrecipients may adopt the Title VI complaint investigation and tracking procedures and complaint form developed by the primary recipient. Recording and ReporÆ ng Transit-Related Title VI InvesÆ gaÆ ons, Complaints, and Lawsuits FTA requires all recipients to prepare and maintain a list of any of the following that allege discrimination on the basis of race, color, or national origin: active investigations conducted by entities other than FTA; lawsuits; and complaints naming the recipient. This list must include the date that the investigation, lawsuit, or complaint was Ïiled; a summary of the allegation(s); the status of the investigation, lawsuit, or complaint; and actions taken by the recipient in response, or Ïinal Ïindings related to, the investigation, lawsuit, or complaint. This list must be included in the Title VI Program. PromoÆ ng Inclusive Public ParÆ cipaÆ on Title VI and the DOT LEP Guidance must be integrated into each recipientâs established public participation plan or process (i.e., the document that explicitly describes the proactive strategies, procedures, and desired outcomes that underpin the recipientâs public participation activities). Module 2.21: Title VI LEVEL II - PAGE II-284
FTA expects states and subrecipients to seek out and consider the viewpoints of minority and LEP populations in the course of conducting public outreach and involvement activities. FTA expects an agencyâs public participation strategy to offer early and continuous opportunities for the public to be involved in the identiÏication of social, economic, and environmental impacts of proposed transportation decisions. Recipients have wide latitude to determine how, when, and how often speciÏic public participation activities should take place, and which speciÏic measures are most appropriate. Recipients should make these determinations based on a demographic analysis of the population(s) affected, the type of plan, program, and/or service under consideration, and the resources available. Efforts to involve minority and LEP populations in public participation activities can include both comprehensive measures, such as placing public notices at all transit stations, stops, and vehicles, as well as targeted measures to address linguistic, institutional, cultural, economic, historical, or other barriers that may prevent minority and LEP persons from effectively participating in a recipientâs decision-making process. FTA Circular 4703.1, âEnvironmental Justice Policy Guidance for Federal Transit Administration Recipients,â includes many examples of effective strategies for engaging minority and low-income populations. Limited English Profi ciency (LEP) States and subrecipients must take reasonable steps to ensure meaningful access to beneÏits, services, information, and other important portions of their programs and activities for LEP individuals. In order to ensure meaningful access, recipients must use the information obtained in the Four Factor Analysis to determine the speciÏic language services that are appropriate to provide. A careful analysis can help a recipient determine if it communicates effectively with LEP persons and will inform language access planning. Four Factor Analysis The U.S. DOT LEP Guidance advises grantees to determine what steps are necessary to provide âmeaningful accessâ on the basis of four factors: 1. The number and proportion of LEP persons served or encountered in the eligible service population 2. The frequency with which LEP individuals come into contact with the program, activity, or service Module 2.21: Title VI LEVEL II - PAGE II-285
3. The nature and importance of the program, activity, or service provided by the program 4. The resources available to the recipient and costs The DOT LEP Guidance also recommends that grantees develop an implementation plan to address the identiÏied needs of the population it serves. The plan should: ⢠Identify LEP individuals who need language assistance ⢠Develop language assistance measures ⢠Address staff training ⢠Detail how to provide notice to LEP persons ⢠Address procedures for monitoring implementation and updating the plan After completing the Four Factor Analysis, grantees are expected to use the results of the analyses to determine which language assistance services are appropriate. Language Assistance Plan or LEP Plan FTA requires its grantees to develop a written Language Assistance Plan, or LEP Plan, to address the identiÏied needs of the LEP population(s) it serves. Recipients have considerable Ïlexibility in developing this plan. At a minimum, it must: ⢠Include the results of the Four Factor Analysis, including a description of the LEP population(s) served ⢠Describe how the recipient provides language assistance services by language ⢠Describe how the recipient provides notice to LEP persons about the availability of language assistance ⢠Describe how the recipient monitors, evaluates, and updates the language access plan ⢠Describe how the recipient trains employees to provide timely and reasonable language assistance to LEP populations States and subrecipients can ensure that LEP persons have meaningful access to their programs and activities by developing and carrying out a language implementation plan pursuant to the recommendations in Section VII of the DOT LEP Guidance. Certain Module 2.21: Title VI LEVEL II - PAGE II-286
grantees or subrecipients, such as those serving very few LEP persons or those with very limited resources, may choose not to develop a written LEP plan. However the absence of a written LEP plan does not obviate the underlying obligation to ensure meaningful access by LEP persons to a granteeâs program or activities. States or subrecipients electing not to prepare a written language implementation plan should consider other ways to reasonably provide meaningful access. Providing Meaningful Access by LEP Persons Such methods can include the following actions: ⢠Translating vital written materials into the language of each frequently encountered LEP group. ⢠Training bilingual staff to act as interpreters and translators. ⢠Using telephonic and video conferencing interpretation services. ⢠Formalizing use of qualiÏied community volunteers. ⢠Using centralized interpreter and translator services. ⢠Hiring staff interpreters. ⢠Using symbolic signs (pictographs). ⢠Translating into languages other than English vital written materials, such as applications or instructions on how to participate in a granteeâs program, signs in bus and train stations, notices of public hearings and other community outreach, and notices advising LEP persons of free language assistance. Subrecipient Assistance States must assist their subrecipients in complying with DOTâs Title VI regulations, including the general reporting requirements. Assistance must be provided to the subrecipient as necessary and appropriate by the state. States should provide the following information to subrecipients; such information, forms, and data may be kept in a central repository and available for all subrecipients: ⢠Sample notices to the public informing beneÏiciaries of their rights under DOTâs Title VI regulations, procedures on how to Ïile a Title VI complaint, and the recipientâs Title VI complaint form. Module 2.21: Title VI LEVEL II - PAGE II-287
⢠Sample procedures for tracking and investigating Title VI complaints Ïiled with a subrecipient, and when the primary recipient expects the subrecipient to notify the primary recipient of complaints received by the subrecipient. ⢠Demographic information on the race and English proÏiciency of residents served by the subrecipient. This information will assist the subrecipient in assessing the level and quality of service it provides to communities within its service area and in assessing the need for language assistance. ⢠Any other recipient-generated or obtained data, such as travel patterns, surveys, etc., that will assist subrecipients in complying with Title VI. Subrecipient Monitoring To ensure that subrecipients are complying with the DOT Title VI regulations, primary recipients (including states) must monitor their subrecipients for compliance with the regulations. Importantly, if a subrecipient is not in compliance with Title VI requirements, then the primary recipient is also not in compliance. FTA requires the following activities of primary recipients: (1) Document its process for ensuring that all subrecipients are complying with the general reporting requirements, as well as other requirements that apply to the subrecipient based on the type of entity and the number of Ïixed route vehicles it operates in peak service if a transit provider. (2) Collect Title VI Programs from subrecipients and review programs for compliance. Collection and storage of subrecipient Title VI Programs may be electronic at the option of the primary recipient. (3) At the request of FTA, in response to a complaint of discrimination, or as otherwise deemed necessary by the primary recipient, the primary recipient must request that subrecipients who provide transportation services verify that their level and quality of service is provided on an equitable basis. Subrecipients that are Ïixed route transit providers are subject to reporting requirements. When a subrecipient is also a direct recipient of FTA funds (that is, applies for funds directly from FTA in addition to receiving funds from a primary recipient), the subrecipient/direct recipient reports directly to FTA and the primary recipient/designated recipient is not responsible for monitoring compliance of that subrecipient. The supplemental agreement signed by both entities in their roles as designated recipient and direct recipient relieves the primary recipient/designated recipient of this oversight responsibility. Module 2.21: Title VI LEVEL II - PAGE II-288
Title VI and FaciliÆ es Planning When developing certain types of facilities, including, but not limited to storage facilities, maintenance facilities, and operations centers, recipients are subject to the following FTA Title VI requirements: a. The recipient must complete a Title VI equity analysis during the planning stage with regard to where a project is located or sited to ensure the location is selected without regard to race, color, or national origin. Recipients must engage in outreach to persons potentially impacted by the siting of facilities. The Title VI equity analysis must compare the equity impacts of various siting alternatives, and the analysis must occur before the selection of the preferred site. b. When evaluating locations of facilities, recipients should give attention to other facilities with similar impacts in the area to determine if any cumulative adverse impacts might result. Analysis should be done at the Census tract or block group where appropriate to ensure that proper perspective is given to localized impacts. c. If the recipient determines that the location of the project will result in a disparate impact on the basis of race, color, or national origin, the recipient may only locate the project in that location if there is a substantial legitimate justiÏication for locating the project there, and where there are no alternative locations that would have a less disparate impact on the basis of race, color, or national origin. The recipient must show how both tests are met; it is important to understand that in order to make this showing, the recipient must consider and analyze alternatives to determine whether those alternatives would have less of a disparate impact on the basis of race, color, or national origin, and then implement the least discriminatory alternative. Requirements and Guidelines for Fixed Route Transit Providers Providers of Ïixed route public transportation that receive federal Ïinancial assistance have additional requirements. All Ïixed route providers must develop systemwide standards and policies. Larger transit systems (those operating 50 or more Ïixed route buses in urbanized areas with over 200,000 in population) are required to collect and analyze demographic data, conduct a formal monitoring program triennially, and conduct service and fare equity analyses. These speciÏic requirements are summarized below. System-wide Standards and Policies All Ïixed route providers must set system-wide standards and policies for each speciÏic Ïixed route mode of service they provide Module 2.21: Title VI LEVEL II - PAGE II-289
(such as local bus, express bus, commuter bus, bus rapid transit, light rail, subway, commuter rail, passenger ferry, etc). System-wide standards and policies are used to examine how services and amenities are distributed across the transit system, in an effort to ensure that all users have equal access to services and amenities. FTA-required quantitative standards include the following indicators for each Ïixed route mode: 1. Vehicle load - the ratio of passengers to the total number of seats on a vehicle. 2. Vehicle headway - the amount of time between two vehicles traveling in the same direction on a line or combination of lines. 3. On-time performance - runs completed as scheduled. This criterion Ïirst must deÏine what is considered to be âon time.â 4. Service availability - a general measure of the distribution of routes within a transit providerâs service area. Providers of Ïixed route public transportation also must adopt system-wide service policies to ensure service design and operations practices do not result in discrimination on the basis of race, color, or national origin. Service policies differ from service standards in that they are not necessarily based on a quantitative threshold. FTA requires Ïixed route transit providers to develop a policy for each of the following service indicators: 1. Distribution of transit amenities for each mode to ensure equitable distribution of amenities across the system. Transit amenities refer to items of comfort, convenience, and safety that are available to the general riding public. 2. Vehicle assignment for each mode (e.g., based on age or condition). Vehicle assignment refers to the process by which transit vehicles are placed into service in depots and on routes throughout the transit providerâs system. AddiÆ onal Requirements for Larger Providers Fixed route transit providers that operate 50 or more Ïixed route vehicles in peak service and are located in a UZA of 200,000 or more in population are subject to additional requirements, as are transit providers that are placed in this category at the discretion of the FTA Director of Civil Rights in consultation with the FTA Administrator. These requirements include: ⢠Collecting and reporting demographic data, Module 2.21: Title VI LEVEL II - PAGE II-290
⢠Monitoring transit service, and ⢠Evaluating service and fare changes. These requirements are not addressed in this module and states that have responsibility for overseeing subrecipients that meet these criteria should refer to FTA Circular C 4702.1B, Chapter IV. State Program Requirements As noted above, FTA requires that all direct and primary recipients (including states) document their compliance by submitting a Title VI Program to their FTA regional civil rights ofÏicer once every three years. The stateâs Title VI Program must be approved by the recipientâs board of directors or appropriate governing entity or ofÏicial(s) responsible for policy decisions prior to submission to FTA. For state DOTs, the appropriate governing entity is the stateâs Secretary of Transportation or equivalent. States must submit a copy of the appropriate documentation demonstrating that the stateâs Secretary of Transportation or equivalent ofÏicial has approved the Title VI Program. States must include the following information in their Title VI Program: ⢠All general requirements. ⢠The requirements for transit providers if the state is a provider of Ïixed route public transportation. ⢠A demographic proÏile of the state. ⢠Demographic maps that show the impacts of the distribution of state and federal funds in the aggregate for public transportation projects. ⢠An analysis of the stateâs transportation system investments that identiÏies and addresses any disparate impacts. ⢠A description of the statewide planning process that identiÏies the transportation needs of minority populations. ⢠A description of the procedures the agency uses to ensure nondiscriminatory pass through of FTA Ïinancial assistance. ⢠A description of the procedures the agency uses to provide assistance to potential subrecipients, including efforts to assist applicants that would serve predominantly minority populations. Module 2.21: Title VI LEVEL II - PAGE II-291
SUPPLEMENTAL NOTES RelaÆ onship to Environmental JusÆ ce In 2012, FTA released Circular 4703.1 âEnvironmental Justice Policy Guidance for Federal Transit Administration Recipientsâ. This circular is based on the April 1995 U.S. DOT âOrder to Address Environmental Justice in Minority Populations and Low-Income Populationsâ to fulÏill the environmental justice policy objectives laid out in Executive Order 12898, âFederal Actions to Address Environmental Justice in Minority Populations and Low-income Populations.â The central objective of the U.S. DOT order is to ensure that all federally funded transportation-related programs, policies, or activities having the potential to adversely affect human health or the environment involve a planning and programming process that explicitly considers the effects on minority populations and low-income populations. Under the process outlined in Executive Order 12898 and the U.S. DOT order, environmental justice issues must be considered during preparation of an Environmental Impact Statement (EIS) when required under the National Environmental Policy Act of 1969 (NEPA). FTA Circular 4703.1 provides recommendations to state DOTs, MPOs, public transportation providers, and other recipients of FTA funds on how to fully engage environmental justice populations in the public transportation decision-making process; how to determine whether environmental justice populations would be subjected to disproportionately high and adverse human health or environmental effects as a result of a transportation plan, project, or activity; and how to avoid, minimize, or mitigate these effects. Prior to the release of both 4703.1and 4702.1B in 2012, environmental justice principles were often confused with the requirements of Title VI, and state staff should be aware that there may still be some residual confusion among subrecipients. While Title VI is a key tool for agencies to use to achieve environmental justice goals, Title VI imposes statutory and regulatory requirements that are broader in scope than environmental justice. There may be some overlap between environmental justice and Title VI analyses; however, engaging in environmental justice analysis under federal transportation planning and NEPA provisions will not necessarily satisfy Title VI requirements. Similarly, a Title VI analysis would not necessarily satisfy environmental justice requirements, since Title VI does not include low-income populations. Moreover, Title VI applies to all federally-funded projects and activities, not solely those that may have adverse human health or environmental effects on communities. Module 2.21: Title VI LEVEL II - PAGE II-292
TIPS ON RELATIONSHIPS TO OTHER MODULES Title VI is one of several modules that address civil rights, including EEO (civil rights in employment), DBE (civil rights in contracting), and ADA (civil rights for people with disabilities). LINKS/INFO ⢠FTA C 4702.1B âTitle VI Requirements and Guidelines for Federal Transit Administration Recipientsâ. http://www.fta.dot.gov/ legislation_law/12349_14792.html ⢠FTA C 4703.1 âEnvironmental Justice Policy Guidance for Federal Transit Administration Recipientsâ. http://www.fta.dot.gov/ legislation_law/12349_14740.html ⢠FTA Title VI web page. http://www.fta.dot.gov/civilrights/12328.html ⢠FTA Environmental Justice web page. http://www.fta.dot.gov/civilrights/14882.html ⢠FTA Civil Rights Training Materials. http://www.fta.dot.gov/civilrights/12885.html ⢠DOT Limited English ProÏiciency (LEP) Guidance. http://www.fta.dot.gov/documents/LEP_Handbook.doc ⢠Language Access Assessment and Planning Tool for Federally Conducted and Federally Assisted Programs (May 2011). http:// www.lep.gov/ ⢠Executive Order 13166: âImproving Access to Services for Persons with Limited English ProÏiciencyâ. http://www.fta.dot.gov/ documents/LEP_Executive_Order.doc ⢠US DOT LEP Guidance web page. http://www.civilrights.dot.gov/page/dots-lep-guidance Module 2.21: Title VI LEVEL II - PAGE II-293
⢠Federal Register, December 14, 2005 (Volume 70, Number 239, pp. 74087-74100) âDOT Policy Guidance Concerning Recipientsâ Responsibilities to Limited English ProÏiciency (LEP) Personsâ. http://www.gpo.gov/fdsys/pkg/FR-2005-12-14/ html/05-23972.htm ⢠Title VI of the Civil Rights Act of 1964. https://www.civilrights.dot.gov/page/civil-rights-act-1964#6 QUIZ 1) FTA does not require contractors to prepare or submit Title VI Programs. 1) True. 2) False. 2) All states and subrecipients must develop a written LEP plan. 1) True. 2) False. 3) Fixed route transit providers that operate 50 or more Ïixed route vehicles in peak service and are located in a UZA of 50,000 or more in population are subject to additional Title VI requirements. 1) True. 2) False. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.21: Title VI LEVEL II - PAGE II-294
Module 2.22: Half-Fare KEY CONCEPTS ⢠Applicability ⢠Eligibility Categories ⢠Proof of Eligibility ⢠Internal and Public Information ⢠Oversight INTRODUCTION For Ïixed route service supported with S. 5307 assistance, fares charged elderly persons, persons with disabilities, or an individual presenting a Medicare card during off peak hours must not be more than half the peak hour fare. The statute and applicable regulations include: ⢠49 USC Chapter 53, Federal Transit Laws, § 5307. Urbanized area formula grants ⢠49 CFR Part 18 âUniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governmentsâ ⢠49 CFR Part 609 âTransportation for Elderly and Handicapped Personsâ FTA guidance is found in: ⢠FTA Circular 9030.1D, âUrbanized Area Formula Program: Program Guidance and Application Instructionsâ ⢠FTA Proposed Circular 9030.1E, issued 4-19-13 IMPORTANCE FOR STATE DOT STAFF States are responsible for oversight of S. 5307 subrecipient compliance with this requirement. Some states impose this requirement on all transit operators in the state, including their subrecipients under S. 5311. LEVEL II - PAGE II-295
DEFINITIONS Disability: with respect to an individual, a physical or mental impairment that substantially limits one or more of the major life activities of such individual; a record of such an impairment; or being regarded as having such an impairment. (1) The phrase physical or mental impairment meansâ (i) Any physiological disorder or condition, cosmetic disÏigurement, or anatomical loss affecting one or more of the following body systems: neurological, musculoskeletal, special sense organs, respiratory including speech organs, cardiovascular, reproductive, digestive, genito-urinary, hemic and lymphatic, skin, and endocrine; (ii) Any mental or psychological disorder, such as mental retardation, organic brain syndrome, emotional or mental illness, and speciÏic learning disabilities; (iii) The term physical or mental impairment includes, but is not limited to, such contagious or noncontagious diseases and conditions as orthopedic, visual, speech, and hearing impairments; cerebral palsy, epilepsy, muscular dystrophy, multiple sclerosis, cancer, heart disease, diabetes, mental retardation, emotional illness, speciÏic learning disabilities, HIV disease, tuberculosis, drug addiction and alcoholism; (iv) The phrase physical or mental impairment does not include homosexuality or bisexuality. (2) The phrase major life activities means functions such as caring for oneâs self, performing manual tasks, walking, seeing, hearing, speaking, breathing, learning, and work. (3) The phrase has a record of such an impairment means has a history of, or has been misclassiÏied as having, a mental or physical impairment that substantially limits one or more major life activities. (4) The phrase is regarded as having such an impairment meansâ (i) Has a physical or mental impairment that does not substantially limit major life activities, but which is treated by a public or private entity as constituting such a limitation; Module 2.22: Half-Fare LEVEL II - PAGE II-296
(ii) Has a physical or mental impairment that substantially limits a major life activity only as a result of the attitudes of others toward such an impairment; or (iii) Has none of the impairments deÏined in paragraph (1) of this deÏinition but is treated by a public or private entity as having such an impairment. (5) The term disability does not includeâ (i) Transvestism, transsexualism, pedophilia, exhibitionism, voyeurism, gender identity disorders not resulting from physical impairments, or other sexual behavior disorders; (ii) Compulsive gambling, kleptomania, or pyromania; (iii) Psychoactive substance abuse disorders resulting from the current illegal use of drugs. Fixed Route Service: speciÏied public transportation service, on which a vehicle is operated along a prescribed route according to a Ïixed schedule. Senior: an individual who is 65 years of age or older. DETAILS ON FTA REQUIREMENTS Applicability Fares charged seniors, persons with disabilities, and Medicare cardholders during off peak hours for S. 5307 funded Ïixed route transportation must not be more than half the peak hours fare. FTA requires this only for S. 5307 recipients and subrecipients. States may have a state policy that extends the requirement to S. 5311 subrecipients or others. Services to Which this Rule Applies The requirement is applicable to: Module 2.22: Half-Fare LEVEL II - PAGE II-297
(1) All Ïixed route services, including service to sporting events, that operate in both peak and off peak hours and use or involve facilities and equipment Ïinanced with S. 5307 funds, whether the services are provided by the grantee directly, by a contractor, by a subrecipient, or by another entity that leases facilities and/or equipment from the grantee. (2) Any express and commuter service that operates beyond peak hours. (3) Fixed route services for which the grantee has not deÏined peak hours. (4) Fixed routes that operate with reduced fares in both the peak and off-peak. If there are services such as a neighborhood circulator or shuttle with fares that are different from the granteeâs fare for its regular local service, separate half fares are needed for each type of service. This requirement is not applicable to: (1) Demand responsive services, including route deviation services. (2) Services that operate only during peak hours, such as express and commuter routes. (3) Services that operate only in the off peak hours (e.g., lunchtime circulators and weekend routes to sporting events). (4) Services funded with other FTA assistance that do not use S. 5307 funded equipment or are not operated out of S. 5307 funded facilities. Defi ning âOï¬ Peakâ The grantee determines its peak hours. Peak hours can be seasonal. If the grantee determines it is not large enough, or demand is not strong enough, to identify or justify peak hour service, then its entire service should be deÏined as âoff peak.â In this instance, the grantee has two options: (1) Review ridership data and determine the peak ridership hours and develop a policy for half fare, or (2) Choose not to determine a peak period and offer half fares during all hours. Module 2.22: Half-Fare LEVEL II - PAGE II-298
Eligibility Categories Prior to the passage of MAP-21, half fare was required for âelderly and handicapped individuals, or an individual presenting a Medicare card issued to that individual under title II or XVIII of the Social Security Act (42 U.S.C. 401 et seq., 1395 et seq.).â While MAP-21 deÏines a senior as an individual aged 65 years or over, grantees are permitted to use a deÏinition that extends this fare to younger (e.g., 62 and over) persons. The category of âhandicapped individualsâ was changed in MAP-21 to include individuals âwho by reason of illness, injury, age, congenital malfunction, or other incapacity or temporary or permanent disability (including any individual who is a wheelchair user or has semi-ambulatory capabilities), cannot use effectively, without special facilities, planning, or design, mass transportation service or a mass transportation facility.â Medicare is available for people age 65 or older, younger people with disabilities, and people with end stage renal disease (permanent kidney failure required dialysis or transplant). Proof of Eligibility The half fare program, as applied, may require passengers to show proof of eligibility when they pay their fare. Examples of proof of eligibility include a driverâs license, Medicare card, special identiÏication card, and ADA eligibility card. The grantee may require more than one piece of identiÏication for determining age or disability-related qualiÏications. a. A grantee may require passengers to obtain a special identiÏication card as the sole basis for paying the half fare. A valid Medicare card must be considered sufÏicient proof of eligibility for obtaining the identiÏication card. Obtaining a special identiÏication card must be relatively easy. For example, though not strictly prohibited, requiring individuals to travel to a single Module 2.22: Half-Fare LEVEL II - PAGE II-299
ofÏice, which may be inconveniently located, is not consistent with the intent of this requirement. b. In order to ensure that the person presenting a Medicare card is the authorized individual, the grantee may request proof of identity (another card with a photograph). There is no speciÏic prohibition against this, provided the grantee is not asking for further proof of eligibility from the Medicare cardholder but is only checking the validity of the Medicare card. Internal and Public InformaÆ on A policy is not effective unless it is communicated to those who will carry it out and to those who can take advantage of it. Training documents and communication with operators and others responsible for implementing the fare program should demonstrate that the grantee has notiÏied staff of the program and included the correct information. Public information should include half fare information, including Medicare eligibility, if it contains fare information. For example, if a brochure says the fare to ride the bus is $1.00, it also should say that the fare for elderly persons, persons with disabilities, and Medicare cardholders is $0.50 during off peak hours. Though it is not necessary to have a separate fare category for Medicare cardholders, the granteeâs readily available public information must be clear that Medicare cards are accepted as proof of eligibility for the half fare program, including for persons who are not elderly. State Oversight The state is responsible for ensuring that subrecipients, contractors, and lessees that operate services to which the half fare requirement applies comply. The oversight program should ensure: a. That a half fare is offered for applicable services during off peak hours, b. That the deÏinition of off peak hours is reasonable, and c. IdentiÏication requirements allow eligible persons to obtain the half fare, and internal and public fare information show the half fare and eligibility, including Medicare cardholder eligibility. Module 2.22: Half-Fare LEVEL II - PAGE II-300
TIPS ON RELATIONSHIPS TO OTHER MODULES This module is one of several that pertain to service characteristics, including Ensuring Service is Open to the Public, Charter Bus, School Bus, ADA, and Title VI. QUIZ 1. Grantees may use a deÏinition of elderly that extends half fares to those younger than 65. 1) True. 2) False. 2. Which of the following may riders use as proof of eligibility? A. Driverâs license B. Medicare card C. ADA eligibility card 1) A. 2) B. 3) A and C. 4) All of the above. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.22: Half-Fare LEVEL II - PAGE II-301
Module 2.23: Ensuring the Services Are Open to the Public KEY CONCEPTS ⢠Eligible Use of Funding for Public Transportation Projects under Each Grant Program ⢠Incidental Use ⢠State Monitoring of Subrecipients INTRODUCTION Section 5307, 5311, and 5339 funds are available for expenditure for public transportation projects. S. 5311(f) funds are also available for intercity bus projects in other than urbanized areas. Services, vehicles, and facilities funded by these programs must be open to the public. Charter or sightseeing service is not eligible for FTA funding. Section 5310 program funds are available for public transportation capital projects that are planned, designed, and carried out to meet the speciÏic needs of seniors and individuals with disabilities. The statutes and regulations include: ⢠49 USC Chapter 53, Federal Transit Laws ⢠FTA Master Agreement ⢠The program circulars for each FTA funding program IMPORTANCE FOR STATE DOT STAFF States are responsible for ensuring that S. 5307, 5310, 5311, and 5339 funds, as well as capital facilities and equipment that was funded under the former S. 5309 program, are being used to support eligible projects and services. DEFINITIONS Charter Service: transportation at the request of a third party for the exclusive use of a bus or van for a negotiated price; or transportation to the public for events/functions that occur on an irregular basis or for a limited duration (when the service in paid for by a third party or a premium fare is charged). LEVEL II - PAGE II-302
Intercity Bus Service: regularly scheduled bus service for the general public that operates with limited stops over Ïixed routes connecting two or more urban areas not in close proximity, that has the capacity for transporting baggage carried by passengers, and that makes meaningful connections with scheduled intercity bus service to more distant points, if such service is available. Public Transportation: regular, continuing shared-ride surface transportation services that are open to the general public or open to a segment of the general public deÏined by age, disability, or low income; and does not include: intercity passenger rail transportation provided by Amtrak; intercity bus service; charter bus service; school bus service; sightseeing service; courtesy shuttle service for patrons of one or more speciÏic establishments; or intra-terminal or intra-facility shuttle services. DETAILS ON FTA REQUIREMENTS Section 5307, 5311, and 5339 funds are available for expenditure for public transportation projects. S. 5311(f) funds are also available for intercity bus projects in areas other than urbanized areas. Services, vehicles, and facilities funded by these programs must be open to the public. Charter or sightseeing service is not eligible for FTA funding. Eligible Use of Funding for Public TransportaÆ on Projects under Each Grant Program Section 5307- S. 5307 provides funding for public transportation capital projects, operating assistance, job access and reverse commute projects, and for transportation-related planning in urbanized areas. Section 5310- S. 5310 program funds are available for public transportation projects that are planned, designed, and carried out to meet the speciÏic needs of seniors and individuals with disabilities. Section 5311- S. 5311 provides funding to support public transportation in areas with a population of less than 50,000. Funding may be used for capital, operating, planning, and job access and reverse commute projects. S. 5311(f) funds are also available for intercity bus projects in other than urbanized areas. Module 2.23: Ensuring the Services Are Open to the Public LEVEL II - PAGE II-303
Section 5311 service may be designed to maximize use by members of the public who are transportation disadvantaged, including elderly persons and persons with disabilities. Coordinated human service transportation that primarily serves elderly persons and persons with disabilities (but is not restricted from carrying other members of the public) is open to the general public if it is advertised as public transportation service. Section 5339- S. 5339 (formerly S. 5309) provides funding for public transportation capital projects to replace, rehabilitate, and purchase buses and related equipment and to construct bus-related facilities. Intercity bus stations and terminals are eligible under S. 5339 as part of joint development projects. Incidental Use A grantee may use FTA funded equipment and facilities to support incidental activities that do not detract from the provision of public transportation. However, charter or sightseeing services are not eligible for FTA funding under any of the above FTA programs. FTA encourages maximum use of S. 5310 funded vehicles. Vehicles are to be used for the project stated in the grant application and subrecipient agreement. Beyond those needs, vehicles should be used to meet other transportation needs of elderly individuals and individuals with disabilities; to meet other federal program or project needs; and Ïinally, to meet other local transportation needs. Subrecipients may coordinate and assist in delivering meals if the delivery services do not conÏlict with the provision of transit services or result in a reduction of service to transit passengers. The number and size of vehicles applied for must be determined by the number of passengers to be transported, not meal delivery capacity. Section 5310 funds may not be used to purchase special vehicles to be used solely for meal delivery or to purchase specialized equipment such as racks or heating or refrigeration units related to meal delivery. Transit service providers receiving assistance under S. 5311 may also coordinate and assist in providing meal delivery service for homebound persons on a regular basis if this service does not conÏlict with the provision of mass transit service or result in a reduction of service to transit passengers. FTA expects the nutrition program to pay operating costs attributable to meal delivery. Section 5311 capital assistance may not be used to purchase special vehicles used solely for meal delivery or to purchase specialized equipment related to meal delivery. Similarly, incidental use of a vehicle for non-passenger transportation on an occasional or regular basis is also permitted, as long as it does not result in a reduction of service quality or availability of public transportation service. Module 2.23: Ensuring the Services Are Open to the Public LEVEL II - PAGE II-304
State Monitoring of Subrecipients States are responsible for ensuring that S. 5307, 5309, 5310, 5311, and 5339 funds are being used to support eligible projects and services. For capital facilities and equipment, this responsibility endures so long as FTA has a Ïinancial interest (i.e., until the end of the useful life of the facility or equipment). States need to ensure that services supported with equipment and facilities funded by S. 5307, 5309, 5311 or 5339 meet the deÏinition of public transportation. The state must ensure that incidental service provided by subrecipients does not interfere with the provision of transit service. The state may request information on incidental service in the subrecipient application process. Along with the number of passengers, miles, and other statistics, some states require subrecipients to report periodically on meal delivery and other incidental service. Some states observe subrecipientsâ service during site visits. Some states require S. 5307 and 5311 applicants to provide information on marketing. States typically require subrecipients to report information on the services provided (e.g., populations served - general public, elderly, disabled) on a periodic basis. States might also assist subrecipients in developing marketing plans and a public transportation âbrand.â Subrecipient grant applications generally request a description of the proposed service, including service area, eligible customers, days and hours of operation, and route information. The state must enter into an agreement with subrecipients prior to expending funds on a project that speciÏies the project to be funded under the grant. The state is responsible for monitoring S. 5310 subrecipients to ensure that the funds are being used to support eligible transportation services for elderly individuals and individuals with disabilities. Generally, the stateâs subrecipient application package requests a description of the proposed project, including service area, eligible customers, and days and hours of operation. The state must enter into an agreement with subrecipients prior to expending funds on a project that speciÏies the project to be funded under the grant. The state may require subrecipients to report information on the services provided and populations served on a periodic basis. The state must report performance information on gaps in service Ïilled and ridership for the program. The state may also observe a subrecipientâs service during site visits. Module 2.23: Ensuring the Services Are Open to the Public LEVEL II - PAGE II-305
SUPPLEMENTAL NOTES ⢠As a best practice, state staff should periodically review subrecipient marketing materials (websites as well brochures obtained during sight reviews) and investigate any sign of potential use of FTA-funded equipment or facilities that would constitute charter bus service, exclusive school bus transportation, or services limited to clients of speciÏic human service agencies. When reviewing the annual grant application, checking to see that the applicantâs website and printed marketing materials align with the public services described in the application is recommended. If S. 5311 services are provided by a department on aging or other human service agency, verify that the service is clearly advertised as open to individuals of any age. ⢠A Ïixed route or route deviation service should publish information about its routes - where they operate, where they stop, how to request route deviation service or Ïlag the bus if appropriate, what the schedule is, what the fares are, the availability of ADA paratransit if applicable, and how to qualify for any reduced fares if applicable. ⢠A demand-response service should publish information about its geographic area of coverage, hours of service, how to request service, what the fares are, any Ïixed schedule guidelines, and any eligibility requirements if applicable. ⢠All services should include the agencyâs Title VI policy on public information materials. Although covered in the Title VI module, this is an important statement regarding equal availability to all members of the public. TIPS ON RELATIONSHIPS TO OTHER MODULES ⢠The Charter Bus and School Bus modules describe prohibited practices that would violate the requirement to provide open-to- the-public services. ⢠The Title VI module addresses language that should be included on service informational materials. Module 2.23: Ensuring the Services Are Open to the Public LEVEL II - PAGE II-306
QUIZ 1) Section 5310-funded vehicles can only be used to transport seniors and people with disabilities. 1) True. 2) False. 2) When can a S. 5311-funded vehicle be used in meal delivery services? A. Never B. No more than one hour per weekday, unless approved by the state C. On a regular basis if this service does not conÏlict with the provision of mass transit service or result in a reduction of service to transit passengers D. On a regular basis if this service is primarily geared toward seniors and people with disabilities 1) A. 2) B. 3) C. 4) D. 3) How long must a state ensure that a S. 5339-funded vehicle be used to support public transportation services? A. Until the grant which purchased the vehicle is closed out B. Three years beyond the grant close-out date C. For the state-established useful life of the vehicle D. Until the vehicle is re-titled to the subrecipient 1) A. 2) B. 3) C. 4) C & D. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.23: Ensuring the Services Are Open to the Public LEVEL II - PAGE II-307
Module 2.24: Charter Bus KEY CONCEPTS ⢠FTA Prohibition Against ⢠Exemptions ⢠Exceptions ⢠Charter Registration Website ⢠Oversight of Subrecipients ⢠Quarterly Reporting to FTA INTRODUCTION Recipients (and subrecipients) are prohibited from using federally funded equipment and facilities to provide charter service if a registered private charter operator expresses interest in providing the service. The charter bus prohibition protects private charter operators from unauthorized competition from FTA grant recipients. The statute and regulation governing charter bus transportation are 1) 49 USC 5323(d) and 2) 49 CFR Part 604. There are a number of charter-like services that transit operators might provide that are not considered âcharter servicesâ and are exempt from the charter regulations. In addition, some community-based charter services are allowed as exceptions. IMPORTANCE FOR STATE DOT STAFF The FTA deÏines public transportation as regular and continuing shared-ride surface transportation services that are open to the general public or a segment of the general public deÏined by age, disability, or low income. As with other service types (like intercity bus and school bus), the deÏinition speciÏically excludes charter bus service. As a recipient of FTA funds, the state must ensure that it and its subrecipients comply with the prohibition against charter service. If FTA determines that the recipient has engaged in a pattern of violations, it may withhold funding or bar the recipient from receiving funding in the future. To ensure subrecipient compliance, ⢠States should educate subrecipients on the charter prohibitions and be able to answer Charter service is transportation provided by a recipient at the request of a third party for the exclusive use of a bus or van for a negotiated price. LEVEL II - PAGE II-308
questions on what a subrecipient needs to do to comply with FTA requirements. ⢠States must include the FTA-required charter bus clause in its subrecipient grant agreements. ⢠When reviewing subrecipient grant applications and providing service planning technical assistance, states should review descriptions of FTA-funded service and FTA-funded vehicle usage for potential situations when the charter prohibitions may come into play. If found, the state should examine these services more closely (requesting additional information from the subrecipient as needed), and advise subrecipients of potential violations of charter service. ⢠As part of compliance reviews of subrecipients conducted by the state, states should review the subrecipientâs documentation of any charter service provided under the six allowable exceptions, and subrecipient contracts for operations/management to ensure the required charter service clause is included in the contract. ⢠States must submit quarterly reports on the FTA Charter website on all charter services provided under the exceptions by subrecipients. To do this, states must collect reports at least quarterly from its subrecipients. ⢠States should investigate any complaints they receive regarding potential violations of charter service prohibitions by a subrecipient. DEFINITIONS Charter Service: transportation at the request of a third party for the exclusive use of a bus or van for a negotiated price; or transportation to the public for events/functions that occur on an irregular basis or for a limited duration (when the service is paid for by a third party or a premium fare is charged). Charter service does not include demand response service for individuals. The deÏinition of charter service does not include demand response service, as demand response meets the needs of individuals as opposed to the needs of a group. Even trips carrying a group of individuals may not meet the charter service deÏinition. For example, daily or weekly subscription trips for individuals with disabilities between a living facility and a recreation site are not considered charter service- these trips are regular and continuous special transportation. (Source: Federal Register, Volume 74, Number 41 (Wednesday, March 4, 2009), âNational Transit Database: Policy on Reporting of Coordinated Human Services Transportation Data,â p. 9472). Module 2.24: Charter Bus LEVEL II - PAGE II-309
Charter Service Exceptions: certain community-based charter services that may be provided if the grantee complies with required procedures and maintains required documentation. Charter Service Exemptions: certain charter-like services that are always exempt from the charter service prohibitions, and require no special permission, recordkeeping, or reporting. Exemptions are not considered charter service. Charter Service Hours: total hours operated by buses or vans while in charter service including: 1) hours operated while carrying passengers for hire, plus 2) associated deadhead hours. QualiÏied Human Service Organization (QHSO): an organization that serves persons who qualify for human service or transportation-related programs or services due to disability, income, or advanced age. Registered charter provider: a private charter operator that has registered on FTAâs Charter Registration Web site and therefore receives notices of charter service requests. DETAILS ON FTA REQUIREMENTS Except under limited exceptions and exemptions, recipients are prohibited from using federally funded equipment and facilities to provide charter services. Recipients of federal transit funding must enter into the Charter Service Agreement. It states: âThe recipient agrees that it, and each of its subrecipients, and third party contractors at any level who use FTA-funded vehicles, may provide charter service using equipment or facilities acquired with federal assistance authorized under the Federal Transit Laws only in compliance with the regulations set out in 49 CFR 604, the terms and conditions of which are incorporated herein by reference.â Though no longer delineated in a separate section of 49 CFR 604, there are six exemptions to the charter service prohibition. Unlike the exceptions described later, the exemptions do not require any type of record keeping because they are not technically charter service. The exemptions apply to: Module 2.24: Charter Bus LEVEL II - PAGE II-310
1. A recipient transporting its employees or other transit/government ofÏicials or contractors to/from transit facilities or projects within its service area to conduct oversight functions (e.g. inspections). 2. Private charter operators that receive federal funding under S. 3038, 5307, 5309, 5310, 5311, or the former S. 5316 or 5317, and provide charter service for program purposes under contract with a public transit agency. [Several of these programs were repealed or consolidated under MAP-21. See the additional exemptions below for more details.] 3. A recipient transporting its employees or other transit/government ofÏicials or contractors for emergency preparedness planning and operations. 4. Recipients that receive federal funding under S. 5310, 5311, or the former S. 5316 or 5317, and provide charter service for program purposes only (i.e., serving targeted populations such as seniors and people with disabilities under S. 5310). 5. A recipient responding to a declared emergency (or taking immediate actions prior to a formal declaration). 6. A recipient in a non-urbanized area transporting its employees, other transit system employees, transit management ofÏicials, and transit contractors and bidders to/from transit training outside its service area. In addition to the six exemptions above, Section 32 the FTA Master Agreement outlines three additional circumstances in which the regulations to not apply, in light of MAP-21: 1. Equipment or facilities funded through the amended Section 5307, to support activities that would have been eligible under S. 5316 (the repealed JARC program) (e.g., employment transportation for low income individuals). 2. Equipment or facilities funded through the amended Section 5310, to support activities that would have been eligible under S. 5317 (the repealed New Freedom program) (i.e., transportation for people with disabilities that goes beyond what is mandated under ADA). 3. A recipient providing private intercity or charter transportation operators reasonable access to its federally funded public transportation facilities (e.g. park and ride lots) [49 USC 5323(r)]. There are also six exceptions to the charter service prohibition. The six exceptions in which recipients may provide community-based charter services (contingent on speciÏic reporting requirements and, in some cases, hourly restrictions) are: 1. Charter service for government ofÏicials on ofÏicial government business (limited to 80 charter service hours annually). Module 2.24: Charter Bus LEVEL II - PAGE II-311
The recipient must provide the service in its service area, must not generate revenue from the service, and must document details of the service including the government organizationâs contact information, date, time, number of passengers, trip origin, destination, and length, fees collected, and vehicle number. 2. Charter service for qualiÏied human service organizations (QHSOs) for the purpose of serving persons with age-related mobility limitations, disabilities, or low incomes. If the QHSO does not receive federal funding (see 49 CFR 604, Appendix A for a program list), the QHSO must register on the FTA Charter Registration Website. As with government ofÏicials, the recipient must document the details of the service for the QHSO. 3. When leasing FTA funded equipment and drivers to private charter operators that are registered on the FTA Charter Registration Website. The charter provider must have exceeded its available capacity of vehicles/accessible vehicles and have exhausted all of the available vehicles of all other registered charter providers in the area. The recipient is responsible for recording the details of the transaction. 4. When no registered charter provider responds to notice from the recipient, either within 72 hours or 14 calendar days, depending on the date the service is to be provided. The recipient uses the Charter Registration Website to generate a list of e-mail addresses for the notice, and must subsequently document the details of the service. 5. When the recipient has entered into an agreement with all registered charter providers in the geographic service area. Parties to the agreement may cancel with 90-day notice. The recipient has 90 days to engage newly registered providers; if no agreement is reached in that time the exception no longer applies. 6. When the recipient petitions the Administrator (see 49 CFR 604.11 for exact petition requirements). Valid reasons include: (1) Events of regional or national signiÏicance; (2) Hardship (only for areas with a pop. of <200,000); or (3) Unique and time sensitive events (e.g., funerals) in the publicâs interest. For Exceptions #1-4, the recipient must post a quarterly electronic report on the FTA Charter Registration Website (30 days after the end of each calendar quarter). States are required to submit these reports for their subrecipients, and therefore states need to Module 2.24: Charter Bus LEVEL II - PAGE II-312
collect such reports from their subrecipients. No particular format is required, but the report is generally a single spreadsheet with three sections (listing all the trips occurring during the quarter): Section 1- Ïilled out for all exceptions (exception codes are GO for government ofÏicials, QH for qualiÏied human service organizations, LE for leasing, and WN for no response to notice). Exception Name Address Phone # Email Section 2- Ïilled out for GO, QH, and WN exceptions only. Date of Service Start Time of Service # of Passengers Trip Origination Trip Destination Trip Duration (hours) Fee Collected (per capita or total) Vehicle #s Section 3- Ïilled out for LE exception only. # of Vehicles Supporting Documentation (Document Title) The recipient must maintain the report (and notice, in the case of Exception #4) in an electronic format for three years. Quarterly reporting is publically accessible here: http://ftateamweb.fta.dot.gov/Teamweb/(S(mqzusd55rv2hqw45tr5otkmo))/ CharterRegistration/QueryCharterReport.aspx. Charter Service Exceptions at a Glance: 1. For government ofÏicials on ofÏicial government business 2. For qualiÏied human service organizations 3. Leases of FTA funded equipment and drivers to registered private charter operators 4. When no registered charter provider responds to notice 5. When the recipient has an agreement with all registered charter providers in the area 6. When the recipient petitions the Administrator with a valid reason Module 2.24: Charter Bus LEVEL II - PAGE II-313
FTAâs Charter RegistraÆ on Website http://ftawebprod.fta.dot.gov/CharterRegistration/splash-charterregistration.aspx The Charter Registration Website has several functions. Interested parties are able to: ⢠Submit new private charter operator and QHSO registrations ⢠Search existing private charter operator and QHSO registrations ⢠Access Quarterly Reports through TEAM By providing the required information on the Charter Registration Website (and updating the information at least every two years), private charter operators become registered charter providers. They then receive notice of charter requests and have standing to Ïile complaints. Similarly, QHSOs that do not receive federal funding under a qualifying program (see 49 CFR 604, Appendix A) and who wish to provide or receive charter services must also register. Recipients use the Charter Registration Website to issue an e-mail notice to the registered charter providers as allowed under Exception #4. The notice must be sent by COB on the day the recipient receives the request (or COB of the next day if the request is after 2PM). The email must include relevant details of the requested service [see 49 CFR 604.14 for exact requirements], and must be faxed if the email is undeliverable. The recipient must keep an electronic copy of the email notice for three years. As recipients, states must ensure that their subrecipients only provide charter service in accordance with the charter regulations. States must also Ïile the quarterly reports for themselves and their subrecipients (if the subrecipients do not have access to TEAM). SUPPLEMENTAL NOTES ⢠Subpart E of 49 CFR 604 details the process in which interested parties can request an advisory opinion and/or a cease and desist order regarding potential charter service violations by recipients. Subpart F describes the requirements for Ïiling Module 2.24: Charter Bus LEVEL II - PAGE II-314
complaints, either about a registration on the Charter Registration Website or about the provision of charter service by a recipient. Subparts G through K describe the investigation, hearing, and appeals process. ⢠For additional information on the statutory and regulatory history of charter service, see the Federal Register, January 14, 2008, âCharter Serviceâ Final Rule. The Federal Register, August 1, 2008, âCharter Serviceâ Final Rule also includes an extensive question and answer section in Appendix C (updated from the January Final Rule). ⢠When contracting for operations and/or management services, recipients and subrecipients must include a charter service clause in the contract. TIPS ON RELATIONSHIPS TO OTHER MODULES ⢠Targeted populations and services for each FTA grant are described in the Introduction to FTA Grants module. ⢠A charter bus clause is required in any procurements for transit operations or management (see the Procurement Policies, Process, and History module for more details on contract clause requirements). LINKS/INFO ⢠49 CFR 604, Charter Service (Final Rule: January 14, 2008; August 1, 2008). http://www.ecfr.gov. ⢠49 USC Part 5323(d). ⢠FTA Charter Bus Service Website. www.fta.dot.gov/legislation_law/12922.html. ⢠FTA Charter Registration Website. http://ftawebprod.fta.dot.gov/CharterRegistration/Default.aspx?p=%2fCharterRegistration %2f. Module 2.24: Charter Bus LEVEL II - PAGE II-315
⢠FTA Master Agreement Section 32. http://www.fta.dot.gov/documents/19-Master.pdf. ⢠Section 5311 Charter Service IdentiÏication Flow Chart. www.fta.dot.gov/documents/Flow_Chart.pdf. QUIZ 1) If a recipient or subrecipient provides service for the exclusive use of a bus or van to a third party free of charge, this qualiÏies as charter service. 1) True. 2) False. 2) Which of the following is NOT a possible feature of charter service? A. A third party pays a transit provider an in-kind payment for service, such as a new bus shelter B. A third party collects the fares charged to individual members of a group C. A transit provider offers the service on a regular schedule D. A third party determines the origin and destination of the trip as well as scheduling 1) A. 2) B. 3) C. 4) D. Module 2.24: Charter Bus LEVEL II - PAGE II-316
3) Which of the following are examples of exceptions to the charter service prohibition? A. Providing service for city council and business ofÏicials touring a new stadium in the recipientâs service area for up to 80 hours in a year B. Providing service to transit employees for the transit agencyâs annual picnic C. Providing seasonal service (e.g. to beaches or ski areas) for the public on a regular schedule that is consistent from year to year 1) A. 2) B. 3) C. 4) A & B. 4) A new private charter provider outside of the recipientâs geographic service area registers on the Charter Registration Website. If the recipient wants to pursue a request for charter service, it must: A. Provide notice to the new provider (as well as others) within 72 hours or 14 calendar days B. Secure an agreement with the new provider regarding the service within 90 days 1) A. 2) B. 3) A & B. 4) Neither A nor B. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.24: Charter Bus LEVEL II - PAGE II-317
Module 2.25: School Bus KEY CONCEPTS ⢠FTA Prohibition ⢠Oversight of Subrecipients INTRODUCTION Recipients of federal funds may not engage in school bus operations exclusively for the transportation of students or school personnel in competition with private school bus operators. First included in the 1973 Federal-Aid Highway Act, Congress intended to protect private school bus operators that could be unfairly displaced by federally funded transit systems. The statute and regulation governing school bus transportation are 1) 49 USC 5323 and 2) 49 CFR Part 605. IMPORTANCE FOR STATE DOT STAFF The FTA deÏines public transportation as regular and continuing shared-ride surface transportation services that are open to the general public or a segment of the general public deÏined by age, disability, or low income. Among other service types (like intercity bus and charter bus), the deÏinition speciÏically excludes school bus service. This requirement applies to exclusive bus service to public and private schools. As a recipient of FTA funds, the state must ensure that it and its subrecipients comply with the prohibition against exclusive school bus service. If the FTA determines that the recipient has violated the school bus agreement, it may bar the recipient from receiving transit funding in the future. To ensure subrecipient compliance, ⢠States should educate subrecipients on the FTA school bus restrictions and be able to answer questions on what a subrecipient needs to do to comply with FTA requirements. ⢠States must include the FTA-required school bus clause in its subrecipient grant agreements. LEVEL II - PAGE II-318
⢠When reviewing subrecipient grant applications and providing service planning technical assistance, states should review descriptions of FTA-funded service and FTA-funded vehicle usage for potential school bus service. If found, the state should examine these services more closely (requesting additional information from the subrecipient as needed), and advise subrecipients of potential violations of school service restrictions. ⢠As part of compliance reviews of subrecipients conducted by the state, states should review school bus notice or certiÏication in lieu of notice, the subrecipientâs published schedules to ensure âtripper serviceâ is published, and subrecipient contracts for operations/management to ensure the required school bus clause is included in the contract. ⢠States should investigate any complaints they receive regarding potential violations of school bus prohibitions by a subrecipient. DEFINITIONS Adequate Transportation: transportation for students and school personnel that conforms to applicable safety laws; is on time; poses a minimum of discipline problems; is not subject to Ïluctuating rates; and is operated efÏiciently and in harmony with state educational goals and programs. Exclusively: service that a reasonable person would conclude was primarily designed to accommodate students and school personnel, and only incidentally to serve the nonstudent general public. Incidental: the transportation of school students, personnel, and equipment in charter bus operations during off peak hours which does not interfere with regularly scheduled service to the public. Reasonable Rates: rates found to be fair and equitable taking into consideration the local conditions which surround the area in question. Module 2.25: School Bus LEVEL II - PAGE II-319
Tripper Service: regularly scheduled mass transportation service that is open to the public and is designed or modiÏied to accommodate the needs of school students and personnel, using various fare collections or subsidy systems. DETAILS ON FTA REQUIREMENTS Recipients of federal transit funding are prohibited from operating exclusive school bus service. As a condition of funding, applicants must agree in writing that they will not engage in school bus operations exclusively for the transportation of students and school personnel, in competition with private school bus operators. Recipients can provide service to schools as part of their overall operations, as long as the schools are treated like any other origin or destination. The following three exemptions apply to the school bus prohibition: 1) If the recipient also operates a separate and exclusive school bus program for a school system, 2) If private school bus operators in the area are unable to provide adequate transportation that complies with applicable safety standards at reasonable rates, or 3) If the recipient was engaged in school bus operations during a speciÏied period in 1973 or 1974. If the recipient is authorized to provide school bus service under one of the above exemptions, it must enter into a different written agreement stating that it will notify FTA of any changes that might impact the exemption. School bus service allowed under the exemptions may not involve federally funded buses, equipment, or facilities. In addition, the non-federally funded buses, equipment, and facilities must be used incidentally, not interfering with their use for general public service. The prohibition against the use of federally funded buses, facilities, and equipment does not apply to school tripper service. Though designed or modiÏied for students and school personnel, tripper service must âoperate and look like all other regular service.â It may have modiÏications to its fare collection/subsidy systems, modiÏications to frequency, and/or minor modiÏications to its route paths. However, it must: Module 2.25: School Bus LEVEL II - PAGE II-320
⢠Have regularly scheduled service that is open to the general public. ⢠Not have any special school designations that might deter the general public. ⢠Operate within the regular service area and stop only at regular bus stops (as published in route schedules). ⢠Have publicly available schedules (in the form of all other schedules- i.e. paper and/or online). SUPPLEMENTAL NOTES FTA has made several recent rulings regarding violations of the school bus regulations (http://web1.ctaa.org/webmodules/ webarticles/articleÏiles/DigitalCT_Spring13_School.pdf). In one case, the Bay Area Transportation Authority (BATA) in Suttons Bay, Michigan developed deviated Ïixed routes in response to a request from its school district. The FTA found that the routesâ schedules and frequencies were signiÏicantly different than those of BATAâs other operations (one way in the morning/returning in the afternoon, reduced in the summer, etc.), and that they lacked signage like the rest of the system. An adult (who happened to be a private investigator) was also reported as a suspicious person while riding one of the routes. BATA did not provide notice or certiÏication, and did not ask FTA to issue an approval or disapproval. Another example comes from Yankton, South Dakota. Like the Sutton Bay case, the Yankton school system was facing economic hardships and could no longer provide school transportation. Its local transit provider, Yankton Transit, set up a system with parents to take students to school. FTA found that the route had a different fare, and that non-students were prohibited from riding. In both Suttons Bay and Yankton, the National School Transportation Association (NSTA) investigated. The NSTA monitors school bus service throughout the country and Ïiles complaints with FTA regarding possible violations. In both cases, FTA issued a cease and desist order to the local transit providers. FTA also issued a policy statement on school bus regulations in 2008, in response to the Rochester-Genesee Regional Transportation Authority (RGRTA) v. Hynes-Cherin U.S. District Court decision. In the case, the U.S. District Court found that 240 express school bus routes operated by RGRTA were not in violation of FTAâs school bus regulations because the general public hypothetically could board them. FTA found that decision âproblematic,â as it undermined the intent of the regulation. In the policy statement, FTA clariÏied its deÏinitions of tripper service and school bus operations, saying that both deÏinitions stood as they had been historically interpreted. FTA felt that the U.S. District Court had too narrow a view of âexclusiveâ and too broad a view of âtripper service.â Module 2.25: School Bus LEVEL II - PAGE II-321
TIPS ON RELATIONSHIPS TO OTHER MODULES 49 CFR Part 605.12 notes that recipients may use federally funded buses, facilities, and equipment for the transportation of school students during incidental charter bus operations. See the Charter Bus module for more details on what constitutes incidental charter bus operations and when they are allowable. When contracting for operations and/or management services, recipients and subrecipients must include a charter service clause in the contract. LINKS/INFO ⢠49 CFR 605, School Bus Operations. http://www.ecfr.gov. ⢠FTA Master Agreement Section 33. http://www.fta.dot.gov/documents/19-Master.pdf. ⢠Final Policy Statement on FTAâs School Bus Operations Regulations. September 16, 2008. http://www.gpo.gov/fdsys/pkg/FR- 2008-09-16/html/E8-21601.htm. Module 2.25: School Bus LEVEL II - PAGE II-322
QUIZ 1) Under what circumstances would a recipient be exempt from the school bus regulations? A. The recipient is authorized to operate a separate/exclusive school bus program for a school system. B. The recipient operates tripper service. C. The recipient operates in a non-urbanized area. 1) A & B. 2) A & C. 3) B & C. 2) When operating tripper service, a recipient may: A. Use a different fare collection system. B. Make minor route alterations in close proximity to schools. C. Designate the service as a school route on the vehicle or on the transit systemâs website. 1) A & B. 2) B & C. 3) A & C. Module 2.25: School Bus LEVEL II - PAGE II-323
QUIZ 3) Recipients providing school service under one of the statutory exemptions may use FTA funded buses, equipment, and facilities for that service. 1) True. 2) False. 4) If no private school bus operators exist in a recipientâs area, the recipient is automatically authorized to provide school bus service. 1) True. 2) False. The Quiz Answer Key can be found at the end of the Introductory Materials section of the curriculum. Module 2.25: School Bus LEVEL II - PAGE II-324
