INTRODUCTION TO FEDERAL HIGHWAY FUNDING AND

ELIGIBILITYSteve Baumann

Financial Specialist

(503) 587-4729

Mike Morrow

(Field Operations Engineer)503-5874708

EXPECTATIONS

•Characteristics of the FAHP

•Legislation

•Responsibilities

•Major funding requirements

•Discretionary – Earmarked funds

Characteristics of the Federal-Aid Highway Program

State Administered, Federal Stewardship Funding tied to specific “systems” Requires States to have Highway Agency or

locals to have responsible individual States/locals pay for routine maintenance Matching requirements Reimbursable program

Review and approve state/local proposals

Develop regulations and guidance

Promulgate standards

Provide technical assistance

Distribute line of credit

Reimburse States their eligible expenses

State DOTApportionment

orAllocation

Federal, State and Local Relationship Federal Responsibilities

Federal, State and Local RelationshipState and Local Responsibilities

Conceive, prioritize, plan, design, and construct projects

Maintain and operate highways

Safe, Accountable, Flexible, Effient Transportation Equity Act –A Legacy for Users

(SAFETEA-LU)

Highways, highway safety, transit

5-year legislation - 2005-2009

Signed into law August 10, 2005 (P. L. 109-59) $244 billion authorized over 5 years

(12% increase over TEA-21) Highways - $193 billion Transit - $51 billion

Highway Trust FundSAFETEA-LU of 2005

Extended authorization for FY2005-2009

Extended HTF through FY 2011

Congress added eight billion with hopes of getting through 2009

State Request, Federal Approval Commits State’s Line of Credit Commits Federal Government to Reimburse State

Based on Estimates

Protects Funds from Lapsing

Traditional Point of Budgetary Control

Obligations

Obligation Limitation(Obligation Ceiling)

What is it?

Who does it?

Why?

A budgetary mechanism to control Federal spending

Congress -- through legislation

To be responsive to current budget policies

Obligation LimitationCharacteristics

Applies

Total

to

Program

State-by-State Limit

Sept 2001

Oct 2000

Good for 1 Year

1

30

State submits

FHWA sends

State pays contractor

voucher to FHWA

to Treasury

Treasurer wiresmoney to State

Contractordoes work

State pays LPA

State submitsvoucher to FHWA

FHWA sendsto Treasury

Treasurer wiresmoney to State

LPA paysContractor

Time

Actions

Reimbursement

Functional ClassificationEligibility for Federal Financial Assistance

Ineligible Eligible

Local - 76%

Interstate - 1%(Included in NHS %)

NHS - 4%

Other - 20%

Out of 3.9 million miles of roads in the U.S., less than 1 million miles are eligible forfederal financial assistance.

General Eligibility

Roadways eligible for Federal-aid funding:• publicly owned and open to public

• be functional classified higher than rural minor collectors or local roadways

• meet the requirements of the specific Federal funding program

General Categories of Federal-aid Funds

Interstate Maintenance (IM) National Highway System (NHS) Surface Transportation Program (STP) Highway Bridge Program Congestion Mitigation & Air Quality (CMAQ) Emergency Relief Discretionary Programs Earmarked Projects

Discretionary

Division office authorization

Apply (subsequent FHWA approval)

Discretionary

Corridors & BordersInnovative Bridge Research and Construction National Historic Covered Bridge Program Public Lands Highways Ferry BoatsScenic Byways Transportation and Community and System Preservation Pilot Program (TCSP)Highways for LifeTruck Parking, and Value Pricing

Earmarked Funds

Law may define eligible activitiesReverts to program requirements

Written in lawLaw makes funds available

Does NOT authorize project!!!May have to apply (discretionary)Needs FHWA authorizationMay not get all of funds, or in one year!

LPA Advertising for Bids

“THOU SHALT HAVE AN FHWA

AUTHORIZATION IN THY

HANDS PRIOR TO

ADVERTISING FOR BIDS”(or spending any money)

Local Responsibilities and Expectations for LPA projects

Knowledge of Federal-aid requirements ODOT/Local Partnership: early,

continuous communication and coordination needed.

ODOT/LPA knowledge of what is happening on LPA projects (funding, work progress, inspections, etc)

Local Responsibilities and Expectations for LPA projects

ODOT provides oversight of Local Agencies and is not relieved of its responsibilities for LPA projects’ compliance with Federal regulations

Certification program allow LPAs to use their own procedure, forms, etc., but does not relieve them or ODOT of the responsibility to comply with all Federal and State regulations and laws