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SUMMARY PRACTICES AND PERFORMANCE MEASURES FOR LOCAL PUBLIC AGENCY FEDERALLY FUNDED HIGHWAY PROJECTS Many federally funded transportation programs are developed and managed by local agencies and administered by state transportation agencies (DOTs). In 2006, an estimated $6 billion to $8 billion in federal-aid contracts was administered by local public agen- cies (LPAs) in at least 45 states, representing about 20% of the overall annual federal-aid program. Since 2006, there has been significant growth nationally in dollars allocated to LPA projects, particularly in light of American Recovery and Reinvestment Act (ARRA) funding. As of 2009, 13% of statesâ overall federal-aid highway program goes to LPA, representing $7.38 billion; and 18% of statesâ overall ARRA program goes to LPA, repre- senting $6.07 billion. This represents an increase of $5 billion to $7 billion for LPA projects over the overall federal-aid program, demonstrating an even more critical need to study practices and performance measures for LPA federally funded transportation projects. In 2011, NCHRP Synthesis Report 414 explored and discussed the challenges to delivering federal-aid projects (McCarthy et al. 2011). The Office of Inspector General (OIG) of the U.S. Department of Transportation (U.S. DOT) found that 88% of LPA projects that OIG reviewed in 2011 had at least one instance of noncompliance with federal requirements. The DOT Local Programs Officers are primarily responsible for distributing and man- aging federal-aid funds that could be made available for local agency use. For a number of reasons, federally funded projects that might be performed by LPAs, or those that are obligated to LPAs, never come to fruition. Some reasons include an LPA funding match not being available, projects not being construction-ready, one-size-fits-all federal require- ments that leave little flexibility, and state-level restrictions and processes that may create challenges to the LPA program. In addition, there is an outstanding balance of unspent congressionally directed funds, many of which are allocated to LPAs. Even in states with LPA certification programs, some DOTs and LPAs note that these programs do not neces- sarily reduce overall project delivery time or administrative burden. This synthesis of public agency practices used in federal-aid project development and management identifies efficient methods and performance measures used by DOTs and LPAs. One focus of the surveys conducted was to identify measures that are used to gauge how LPAs administer federal-aid projects successfully. The synthesis findings may be used to assist state and local public agencies, planning organizations, and other stakeholders in developing and managing federally funded projects at a higher level of accountability and efficiency. Of particular interest to this project were the definition and elements of DOT-sponsored LPA certification programs. The information was gathered in four phases through the following methods: ⢠Literature search and review of agency resources, ⢠Survey of DOT local program representatives in all states, ⢠Survey of local public agency representatives identified by DOTs, and ⢠Follow-up interviews with multiple state and local agency representatives.
2 The literature search of the LPA program was conducted by using traditional sources such as the TRB-sponsored Transportation Research International Documentation and review- ing public domains such as individual DOT websites and the FHWA website. Communica- tions from national organizations that are LPA program stakeholders, such as the National Association of County Engineers and the American Public Works Association, were used as resources. The majority of synthesis information was gathered through a DOT survey and subse- quent phone interviews. A nested survey looked at the practices and impacts of the LPA certification program administered by several DOTs. All but four of the state invitees responded, a response rate of 92% (see Appendix A). As part of the main DOT survey, LPA administrators were asked to provide the contact information for at least two counterparts at small, medium, and large local agencies within their state. In total, contacts at 105 LPAs in 23 states were invited to respond to a separate survey aimed at identifying successful local practices for planning, receiving, developing, and managing federally funded projects. Forty-one LPAs (19 large, 11 medium, and 10 small) from 17 states responded to the LPA survey (see Appendix B). Due to the nature of the LPA sample selection and response rate, the LPA survey may not be representative of all LPAs. Follow-up telephone interviews were also held with 11 DOTs to obtain more in-depth information and samples of documents, such as programmatic agreements and categorical exclusions, which are used for minimizing delays and cost overruns in LPA projects. The following observations were made based on the DOT and LPA survey data and inter- views of states: ⢠The DOT survey data indicate that the projects that historically take longest to deliver and are most at risk for cost overruns involve transportation enhancement activities, bridge projects, and elements of the surface transportation program, some of which are congressional earmarks. ⢠More than half of the DOTs reported that more than 100 local agencies are participat- ing in federal-aid projects in their state. The rationale for LPA eligibility was reported to be based mostly on the federal-aid program type, local match availability, certifi- cation status by the state DOT, appropriate and available LPA staff size, and size or complexity of the project scope. ⢠A majority (62%) of DOT respondents were not supportive of federal regulations requir- ing states to administer a certification program. Of the 41 LPAs surveyed, 26 were not supportive of federal regulations requiring states to administer a certification program. ⢠Ongoing training programs for LPAs, regardless of the existence of DOT-sponsored certification programs, are important for understanding the complexities of the federal- aid program and teaching the skills needed to improve the planning, programming, design, and procurement of federally funded projects. A majority of LPAs indicated that training on federal regulations and the entire federal-aid process was a key aspect of the training. ⢠According to the DOT survey, most DOTs do not have formal performance measures for determining eligibility for federal-aid funding or for evaluating the planning, pro- gramming, design, and construction of projects. For many DOTs, the results of both state and federal audits or project reviews are used informally as a tool to help LPAs improve their performance. The majority of the 15 DOTs that do have performance measures hold LPAs accountable primarily through loss of funding or decertification. â The majority of the DOTs reported that the certification process has helped both the DOTs and LPAs better comply with federal-aid requirements. Eleven DOTs indicated that the certification process had helped participating LPAs achieve more of the per- formance measures established for project delivery, especially in the acquisition of right-of-way, construction contracting and inspection, and procurement phases.
3 ⢠A small number of DOTs listed details on what they considered as performance mea- sures in determining the level of success of delivering federally funded LPA projects. Some examples of performance measures defined by DOTs included (1) no instances of LPA noncompliance with program requirements; (2) number of eligible reimburse- ment requests for work associated with each project phase; (3) tracking and reporting the condition of local bridges and city arterial pavement conditions as part of the LPA project delivery; and (4) a certain percentage of LPA projects successfully advertised within 30 days of their scheduled milestone dates. ⢠A majority (34 of 41) LPAs reported that the length of the environmental process, and meeting the related federal requirements, are the major hurdles to successfully delivering federally funded projects. ⢠More than half (22 of 41) LPAs have benefited from programmatic agreements because they provide an established, consistent process for consultation, review, and compliance with one or more federal laws. Similarly, 72% of DOTs reported that the use of programmatic agreements reduced the time required for completion of LPA projects and resulted in overall project cost savings. ⢠Seventy-two percent (72%) of DOT respondents stated that categorical exclusions have accelerated the environmental review period and simplified the environmental review process, primarily through the clear definition of the kinds of projects that incur mini- mal impacts and dedicated coordination among federal, state, and resource agencies. ⢠The feedback provided by the 23 LPAs certified by their state DOTs was that they have improved their ability to deliver federally funded projects more easily and quickly. LPAs indicated that being certified provides the opportunity to be responsible for federally funded projects, rather than to be managed by a state DOT or contracted to a consultant. The LPAs that are not certified are challenged in their capability to control scope creep and other financial aspects of federally funded projects.
