Federal-aid 101 and Federally Funded Project Authorization Fundamentals

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1 Federal-aid 101 and Federally Funded Prject Authrizatin Fundamentals Mark Newland FHWA, Financial Manager Karen Hicks INDOT, Prject Finance Directr Purdue Rad Schl, 2015

2 Objectives fr Tday s Presentatin Prvide an Overview f: The Federal-aid Prgram; Hw t receive federal-aid funds fr LPA prjects; Federally funded prject authrizatin fundamentals.

3 Federal-aid Prgram Established in 1956 at the start f the Interstate era; Generally funded every 4-6 years by new legislatin; Mving Ahead fr Prgress in the 21 st Century (MAP-21) a tw year bill. Highway Trust Fund (HTF) is its fundatin;

4 Highway Trust Fund Incme Truck Sales Tires Truck Use Other Diesel Gasline Gashl

5 Highway Trust Fund Balance As f 10/31/14 FY 2014 & FY 2015 Prjected Estimates fr End-f-Mnth Cash Balances (as f 10/31/14) 1/ 2/ 3/ 4/ Billins f Dllars $12 $10 $8 $6 $4 $2 $0 $10.5 $9.3 $8.5 $8.3 Highway Accunt f the Highway Trust Fund (Includes FHWA, FMCSA & NHTSA) $8.6 $8.4 $8.7 $8.1 $6.5 $5.3 $11.4 Actual $9.2 $7.6 $7.1 $6.1 $6.0 $6.2 $5.8 $6.0 $5.8 Shrtfall anticipated $3.7 $2.0 Prjected ($0.4) ($0.0) ($2) ($2.3) ($4)

6 Federal Tax n Gasline and Gashl/Ethanl Tax f 18.4 Cents Per Galln Set Aside 0.1 Cent fr Leaky Undergrund Strage Tank Fund Cents Highway Trust Fund Accunt 2.86 Cents Mass Transit Accunt

7 Federal Tax n Diesel Fuel Tax f 24.4 Cents Per Galln Set Aside 0.1 Cent fr Leaky Undergrund Strage Tank Fund Cents Highway Trust Fund Accunt 2.86 Cents Mass Transit Accunt

8 Apprtinments The distributin f funds as prescribed by statutry frmula. Often referred t as Frmula Funds. Prgram specific as per frmula. Lane miles, ppulatin, fuel usage, etc. Apprtinment des nt equal spending authrity!

9 Obligatin Authrity (OA) OA = Spending Authrity A restrictin r ceiling n the amunt f Federal funds that may be bligated during a specified perid. Amunt and perid are determined annually by Cngress. Nt prgram specific applies t ttal prgram. OA ~90%-92% f apprtinment.

10 Indiana Federal Funds Indiana s apprtinment = ~$919.7M fr FFY Obligatin authrity = $834.9M r 90.8% f apprtinment. What happens t the $84.8M difference? Unused cntract authrity. Generally rescinded by Cngress

11 U.S. DEPARTMENT OF TRANSPORTATION FEDERAL HIGHWAY ADMINISTRATION FY 2014 FEDERAL-AID HIGHWAY PROGRAM APPORTIONMENTS UNDER THE MOVING AHEAD FOR PROGRESS IN THE 21ST CENTURY ACT (MAP-21) (befre pst-apprtinment set-asides; befre penalties) Natinal Highway Railway- Cngestin Highway Surface Safety Highway Mitigatin & Perfrmance Transprtatin Imprvement Crssings Air Quality Metrplitan Apprtined State Prgram Prgram Prgram Prgram Imprvement Planning Ttal Alabama 457,293, ,340,534 45,720,399 4,531,606 11,397,192 2,980, ,263,043 Alaska 289,366, ,099,405 30,698,493 1,100,000 27,493,201 2,197, ,955,039 Arizna 413,210, ,063,817 42,731,428 2,676,310 51,828,599 5,671, ,182,063 Arkansas 309,420, ,323,747 30,241,707 3,760,553 12,302,362 1,665, ,714,166 Califrnia 1,930,325, ,888, ,843,319 15,280, ,637,790 48,492,758 3,542,468,412 Clrad 298,581, ,338,062 29,641,660 3,169,481 42,256,393 5,126, ,112,989 Cnnecticut 277,794, ,776,706 29,221,153 1,305,705 44,199,692 4,473, ,770,705 Delaware 95,480,033 43,917,817 9,392,311 1,100,000 11,650,737 1,727, ,267,961 Dist. f Cl. 90,575,156 41,661,728 8,853,314 1,100,000 10,092,264 1,720, ,002,708 Flrida 1,143,438, ,945, ,188,758 8,463,816 13,584,723 20,067,504 1,828,689,002 Gergia 745,815, ,051,523 74,082,553 7,875,149 67,884,140 7,530,322 1,246,238,772 Hawaii 96,314,552 44,301,670 9,484,017 1,100,000 10,348,924 1,695, ,244,192 Idah 166,696,757 76,675,274 16,541,631 1,776,694 12,801,698 1,569, ,061,294 Illinis 793,512, ,990,894 76,854,409 10,344, ,990,798 16,537,875 1,372,231,384 Indiana 552,613, ,184,804 53,354,561 7,372,184 47,071,049 5,072, ,668,926 Iwa 293,745, ,113,554 27,054,665 5,225,024 11,284,553 1,922, ,345,450 Kansas 225,079, ,529,302 18,847,102 5,886,861 9,507,296 1,887, ,737,489 Kentucky 398,221, ,169,166 40,107,694 3,652,857 13,686,440 2,455, ,292,458 Luisiana 421,573, ,910,485 42,305,455 4,021,282 11,435,577 4,166, ,413,014 Maine 105,801,083 48,665,176 10,400,865 1,225,628 10,287,373 1,785, ,165,560 Maryland 331,011, ,254,936 34,083,995 2,290,904 53,644,841 6,721, ,007,300 Massachusetts 327,493, ,636,838 33,563,437 2,424,886 63,360,507 8,712, ,191,765 Michigan 593,833, ,144,880 57,856,114 7,400,342 73,935,815 10,036,726 1,016,207,628 Minnesta 377,579, ,674,512 35,536,982 5,955,222 32,195,500 4,431, ,372,872

12 N TABLE 1 U. S. DEPARTMENT OF TRANSPORTATION FEDERAL HIGHWAY ADMINISTRATION OBLIGATION LIMITATION DISTRIBUTION FOR FISCAL YEAR 2014 UNDER THE DEPARTMENT OF TRANSPORTATION APPROPRIATIONS ACT, 2014 STATE Frmula Obligatin Limitatin ALABAMA 666,523,393 ALASKA 431,280,533 ARIZONA 658,807,679 ARKANSAS 444,300,322 CALIFORNIA 3,241,833,216 COLORADO 481,581,822 CONNECTICUT 441,285,833 DELAWARE 149,010,187 DISTRICT OF COLUMBIA 143,658,866 FLORIDA 1,704,023,915 GEORGIA 1,162,185,252 HAWAII 145,600,898 IDAHO 251,629,382 ILLINOIS 1,280,430,045 INDIANA 834,931,075 IOWA 442,085,658 KANSAS 339,953,410 KENTUCKY 597,649,211 LOUISIANA 602,089,506

13 Federal Participatin Share Standard Federal Share: Up t 90% n the Interstate Up t 80% n all ther prjects Can be adjustments under certain prgrams: Safety Up t 100% But n mre than 10% f apprtinments Freight Up t 95% - under certain cnditins. (Interstate 95%, Others 90%) Cngress can change rules midstream

14 Reimbursement Prcess Lcal r State CN Cycle 1 FHWA Authrizes Funding Future Cycles Cntractr des wrk A c t i n s Cntractr des wrk INDOT pays cntractr INDOT invices FHWA FHWA apprves invice INDOT pays cntractr INDOT invices FHWA FHWA apprves invice US Treasury pays INDOT Time US Treasury pays INDOT

15 Reimbursement Prcess - Lcal PE, R/W & CE by Cnsultant Cycle 1 Future Cycles FHWA Authrizes Funding Cnsultant des wrk A c t i n s Cnsultant des wrk Lcal pays Cnsultant Lcal invices INDOT INDOT pays Lcal INDOT invices FHWA FHWA apprves invice Lcal pays Cnsultant Lcal invices INDOT INDOT pays Lcal INDOT invices FHWA FHWA apprves invice US Treasury pays INDOT Time US Treasury pays INDOT

16 T receive Federal-aid Funding Reimbursement Federal planning, envirnmental, and design standards must be fllwed: Must be in MPO Transprtatin Imprvement Plan (TIP) and/r Statewide Transprtatin Imprvement Plan (STIP) Must fllw Natinal Envirnmental Plicy Act (NEPA) Must fllw the Unifrm Act (Right-f-way)

17 Federal Funding Apprval Prcess LPA Cntacts INDOT District LPA Crdinatr Determine the phase(s) f wrk fr which Fed-Aid will be requested: PE, R/W, Cnstructin INDOT/LPA Cntract is executed INDOT requests FHWA authrizatin via FMIS FHWA authrizes (bligates) via FMIS Begin phase f wrk

18 Prcess fr Utilizing Apprved Federal Allcatins frm Prject Calls (Obligating Funds) An apprved federal allcatin and LPA cntract with INDOT des nt grant permissin t begin incurring csts. The federal allcatin, r a prtin, must first be bligated in the FHWA Fiscal Management Infrmatin System (FMIS). Why? => Withut this bligatin any cst incurred will nt be eligible fr reimbursement. N FMIS Obligatin = N Reimbursement!

19 Inactive Obligatins Obligatins with n expenditure activity fr 1 year r greater. N bligatins fr CN unless apprved Plans Specificatins & Estimate (PS&E) exists. N bligatins t hld r save funding fr use at a later date. Once bligated, expectatin is immediate use and mnthly billings t INDOT. FHWA has the authrity t unilaterally debligate inactive funds.

20 2 CFR 200 Supercircular Cnslidates duplicative OMB Circulars int ne. Impact n Federal-aid Prgram Perid f Perfrmance (New Requirement): Requires an end date t be included in the prject agreement (FMIS authrizatin). By Phase PE, R/W, CN N additinal csts may be incurred and are nt eligible fr reimbursement after prject end date. Cmpleted phase cntract must be sent int INDOT s District fr Central Office Audit. Must be based n State s estimated prject schedule including required prcesses t cnfrm with Federal regulatins. FHWA required t ensure estimated schedule is in line with a State s established plicies, prcedures, and prject schedules.

21 Obligating Funds Prcess Prir t beginning any activity fr which federal reimbursement wuld be requested, cntact the District LPA Prgram Directr (PD). District LPA PD will request Central Office thrugh CAPWise t request federal authrizatin thrugh the FMIS. FHWA reviews and if acceptable, electrnically signs the authrizatin. INDOT s Central Office ntifies the District and the District ntifies the LPA. Federally reimbursable csts can nly be incurred after the FHWA FMIS apprval date.

22 Phase f Wrk Requirements PE Fllw the LPA Guidance Dcument and federal funding requirements: Executed cntract with cnsultant LPA cntract with INDOT; this is the same cntract if LPA is a Grup 3 r Grup 4 entity. Ntice f Authrizatin frm District that federal funds have been authrized in FMIS prir t perfrming any reimbursable wrk. Purchase Order w/indot fr federal prtin f cst. Phase cntract end date cntract dcuments delivered t INDOT District Office.

23 Phase f Wrk Requirements R/W Fllw the LPA Guidance Dcument and federal funding requirements: LPA cntract with INDOT; this is the same cntract if LPA is a Grup 3 r Grup 4 entity. Certified envirnmental dcument Ntice f Authrizatin frm District indicating federal funds have been authrized in FMIS prir t perfrmance f any reimbursable wrk Purchase Order with INDOT fr federal prtin f cst Phase cntract end date cntract dcuments delivered t INDOT District Office.

24 Phase f Wrk Requirements UT Fllw the LPA Guidance Dcument and federal funding requirements: Executed cntract with Utility. LPA cntract with INDOT; This is the same cntract if LPA is a Grup 3 r Grup 4 entity. Matching funds submitted t INDOT, if applicable: N match required if the Utility belngs t the Lcal. Submissins fr reimbursements are fr federal dllars nly. Matching funds must be submitted t INDOT if utility is nt wned by Lcal.

25 Phase f Wrk Requirements UT cntinued: Ntice f Authrizatin frm district indicating federal funds have been authrized in the federal system prir t perfrmance f any reimbursable wrk. Purchase Order with INDOT fr federal prtin f cst. Phase cntract end date cntract dcuments delivered t INDOT District Office.

26 Phase f Wrk Requirements RR (Rail Rad) Fllw the LPA Guidance Dcument and Federal Funding Requirements: Executed cntract with Railrad. LPA cntract with INDOT; This is the same cntract if LPA is a Grup 3 r Grup 4 entity. Matching funds submitted t INDOT, if applicable. Ntice f Authrizatin frm district indicating federal funds have been authrized in FMIS prir t perfrmance f any reimbursable wrk. Purchase Order w/indot fr federal prtin f cst. Phase prject end date cntract dcuments delivered t INDOT District Office.

27 Phase f Wrk Requirements CN (Cnstructin) Fllw the LPA Guidance Dcument and Federal Funding Requirements: A cntract will nt g t letting if all f the dcumentatin identified in the LPA Guidance Dcument is nt submitted. Federal authrizatin is carried ut by INDOT thrugh the letting prcess. INDOT cntracts with the Cntractr.

28 Phase f Wrk Requirements CE (Cnstructin Engineering) Fllw the LPA Guidance Dcument and Federal Funding Requirements: Executed cntract with Cnsultant. LPA cntract with INDOT; This is the same cntract if LPA is a Grup 3 r Grup 4 entity. Ntice f Authrizatin frm district indicated federal funds have been authrized in FMIS prir t perfrmance f any reimbursable wrk. Purchase Order with INDOT fr federal prtin f cst. Phase prject end date cntract dcuments delivered t INDOT District Office.

29 Tracking Tls Used by INDOT INDOT Scheduling Prject Management System (SPMS): Multiple milestnes mving prject frm phase t phase; Each phase shws anticipated start dates; Shws when prject is expected t g t letting; Milestnes are used t keep the prject n target. Please refer t the LPA Dcument Guidance Manual and wrk with the assigned District Prject Manager t help utilize this tl and keep yur prject n target.

30 Tracking Tls Used by INDOT CAPWise Database - Prject Finance CAPWise is used fr bligating federal funds when requested by Districts fr all prjects; Once apprved & authrized by FHWA, apprval is captured in CAPWise which maintains the balance f available federal funds. Similar cncept as a checkbk Keeps the balance remaining. This des nt replace the tracking dne by the Lcal Prgrams Management Divisin in CO. They are respnsible fr the allcatin f federal funds as apprved by the initial prject request fr eligibility.

31 INDOT LOCAL Prgram Directrs INDOT-Crawfrdsville District - Susan Kemp Phne: (765) Fax: (765) skemp@indt.in.gv INDOT-Frt Wayne District - David Armstrng Phne: (260) Fax: (260) darmstrng@indt.in.gv INDOT-Seymur District - Debbie Ault Phne: (812) Fax: (812) dault@indt.in.gv INDOT-Greenfield District - Kim Bwdell Phne: (317) Fax: (317) kbwdell@indt.in.gv INDOT-Greenfield District - Cassandra Hudsn Phne: (317) Fax: (317) chudsn1@indt.in.gv INDOT-LaPrte District - Marcia Blansett Phne: (219) Fax: (219) mblansett@indt.in.gv INDOT-Vincennes District Lra Lewis Phne: (812) Fax: (812) llewis@indt.in.gv

32 Future f the Federal-aid Prgram MAP-21 expired in July, 2014 Cngress extended MAP-21 & funding thrugh May, 2015 New bill in?? Emphasis n tying perfrmance management/utcmes t funding; Funding level and resurces are big questins.

33 Financing in the Future Fuel taxes will be ne f principle revenue surces fr the freseeable future. Alternatives t fuel tax will need t be explred. Mileage based user fees, i.e. VMT tax. Tlling Majr bridge prjects Interstate cnstructin/recnstructin

34 Questins? Mark Newland Karen Hicks