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Stewardship and Oversight Plan

THE MISSISSIPPI DEPARTMENT OF TRANSPORTATION AND THE FEDERAL HIGHWAY ADMINISTRATION MISSISSIPPI DIVISION

August 26, 2009

Table of Contents

• Acronyms
• Section 1: Execution of Plan
• Section 2: Introduction
  • 2.1 Overview
  • 2.2 Definitions
• Section 3: Stewardship and Oversight of Federal-aid Projects
  • 3.1 FHWA Responsibilities
  • 3.2 MDOT Responsibilities
• Section 4: Stewardship Roles and Responsibilities for Specific Functional Program Areas
  • 4.1 Environmental Process
  • 4.2 Right-of-way Process
  • 4.3 Design Monitoring Process
  • 4.4 Intelligent Transportation Systems Projects
  • 4.5 Construction Authorization and Monitoring Process
  • 4.6 Bridge Program
  • 4.7 Civil Rights Program
  • 4.8 Financial Management Program
  • 4.9 Maintenance Monitoring Program
  • 4.10 Materials Acceptance Program
  • 4.11 Pavement Management and Design Program
  • 4.12 Planning Program
  • 4.13 Research, Development and Technology Transfer Program
  • 4.14 Safety Program
• Section 5: Control Documents (Policies, Guidelines, Procedures, and Manuals approved or accepted by FHWA for use on Federal-aid projects)

ACRONYMS

Section 1 – Execution of Plan

Pursuant to 23 U.S.C. 106 (c), the Mississippi Department of Transportation (MDOT) and the Federal Highway Administration (FHWA) agree to follow the procedures set forth in this Stewardship and Oversight Plan to carry out their respective oversight responsibilities in the delivery of Federal-aid projects. This Letter of Agreement supersedes all past agreements, including the Agreement signed November 3, 1998, and shall become effective on the date listed below and remain in effect until superseded.

The Intermodal Surface Transportation Efficiency Act (ISTEA) of 1991, the Transportation Equity Act for the 21st Century (TEA-21) of 1998, and the Safe, Accountable, flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU) of 2005 provided flexibility to the States in how to ensure project actions are carried out in accordance with applicable laws, regulations, and policies. TEA-21, Section 1305 (a) requires that FHWA and the State enter into an agreement showing the extent of the State's assumption of the Transportation Secretary's responsibilities. ISTEA and TEA-21 altered the FHWA role from full project oversight and approval of every project or activity funded with FHWA funds to program oversight and some targeted project level approval. The program and project assumptions made possible under Section 1016 of ISTEA and Section 1305 of TEA-21 require that the MDOT accept these assumed responsibilities and provide greater program accountability due to less federal involvement. With the passage of SAFETEA-LU, the overall program has evolved requiring a more comprehensive Agreement that covers all aspects of the Federal-aid Highway Program that provides a road map to effectively and efficiently execute the Federal-aid program relating to programs/project delivery to include financial integrity.

By signing this agreement, the MDOT and the FHWA agree to adhere to the provisions and responsibilities included herein. The MDOT and the FHWA further agree to carry out their responsibilities in a true spirit of cooperation. MDOT agrees that where it assumes FHWA's Title 23 oversight role and approval responsibilities, it is responsible for ensuring that projects are developed and constructed in full compliance with Federal requirements, and that necessary corrective action is taken when actions and approvals are found to be in non-compliance with applicable Federal requirements. The FHWA is available for consultation in such matters or may unilaterally become involved in determining corrective action.

MDOT further understands that nothing contained herein shall relieve it from ultimate accountability for compliance with Federal laws and regulations with respect to the expenditure of Federal-aid highway funds in the State of Mississippi, including those funds passed through to local governments. This agreement does not preclude the FHWA access to and review of Federal-aid projects at any time, and does not replace the provisions of Title 23 United States Code (U.S.C.).

The Stewardship and Oversight Plan is intended to be a living document that can be modified when needed to incorporate additional legislation, additional processes, or other changes to improve program and project delivery in the State of Mississippi. MDOT and FHWA agree to use a broad set of performance and compliance indicators, as identified in the Stewardship and Oversight Plan, to track performance trends and to implement countermeasures/actions when the data is not moving in the desired target direction. Performance and compliance indicators will be reported to the FHWA on the times specified in the Stewardship and Oversight Plan. The FHWA Mississippi Division Administrator or the MDOT Executive Director may initiate amendments to this Stewardship and Oversight Plan should essential modifications become apparent to either party.

Effective Date: 8/26/2009

Section 2 - Introduction

2.1 Overview

This Stewardship and Oversight Plan outlines the roles and responsibilities of both FHWA and MDOT in the accomplishment of oversight and administration of Federal-aid Highway Projects and Programs. The purpose of the Plan is to provide guidance in clarifying actions, preventing misinterpretations, and avoiding time delays. The Stewardship and Oversight Plan is intended to be a living document that can be modified when needed to incorporate additional legislation, additional processes, or other changes to improve program and project delivery in the State of Mississippi. MDOT and FHWA agree to use a broad set of performance and compliance indicators, as identified in the Stewardship and Oversight Plan, to track performance trends and to implement countermeasures/actions when the data is not moving in the desired target direction. This Stewardship and Oversight Plan serves as a continuing plan of project and program oversight responsibilities for each agency covering the following functional areas:

Project Oversight

• Environmental Process
• Right-of-Way (ROW) Process
• Design Process
• Intelligent Transportation System (ITS) Process
• Construction Monitoring Process

Program Oversight

• Bridge Program
• Civil Rights Program
• Financial Management Program
• Maintenance Program
• Materials Quality and Acceptance Program
• Pavement Management and Design Program
• Planning Program
• Research, Development, and Technology Transfer Program
• Safety Program

In addition, the Plan includes stewardship responsibilities for various programs with identified actions by each agency. FHWA will use Program Activities as defined later in this Plan to monitor and evaluate program performance and effectiveness. This Plan incorporates the concept of mutual service standards that include agreed upon formats, procedures and targeted timeframes for MDOT and FHWA actions, including submissions, comments and approvals. The Plan also takes into account the FHWA and MDOT resources and capabilities, and the federal requirements where FHWA has a mandated role in the oversight process. This plan forms the principal basis for monitoring and evaluating the quality of the MDOT's Federal-aid program, and the continued disbursement of federal funds based upon MDOT policies, practices, and staffing resources.

While MDOT can assume the responsibility for FHWA in many Title 23 U.S.C. actions, some Title 23 U.S.C. requirements remain FHWA responsibilities. These program elements include, but are not limited to:

• All Federal responsibilities for planning and programming oversight specified in 23 USC 134 and 135.
• Waivers to Buy America requirements.
• Environmental approvals.
• Civil Rights program approvals.
• Utility Accommodation Procedure
• Special Experimental Project (SEP) methods (FHWA HQ approval required for experimental contracting/project delivery methods)
• Federal air quality conformity determinations required by the Clean Air Act.
• Obligation of funds.
• Addition of access points on the Interstate System.
• Use of Interstate airspace for non-highway-related purposes.
• Hardship acquisition and protective buying.
• Modifications to project agreements.
• Final vouchers.

FHWA will annually perform risk assessments of various program areas for the purpose of prioritizing its program level oversight activities for the coming year. The objective of these risk assessments is to focus the limited resources of the FHWA Division Office on those activities that represent the greatest risk to FHWA in fulfilling its stewardship responsibilities. A portion of the risk assessments will involve an evaluation of MDOT's internal controls, operating procedures, and staffing. By this process, it is expected that the greatest possible confidence level will be achieved for the resources committed. MDOT will be invited to participate in these risk assessments; however, FHWA will make all final determinations of program areas for review.

2.2 Definitions

For the purposes of this agreement, the following definitions apply:

Control Document – Applicable standards, policies, and standard specifications that are acceptable to FHWA for application in the geometric and structural design of highways.

Delegated Projects – (Formerly known as "Exempt" Projects) Projects that do not require FHWA to review and approve actions pertaining to design, plans, specifications, supplemental agreements, estimates, right-of-way certification statements, contract awards, inspections, and final acceptance of Federal-aid projects on a project by project basis.

Full Oversight Projects – Projects that require FHWA to review and approve actions pertaining to design, plans, specifications, estimates, right-of-way certification statements, contract awards, inspections, and final acceptance of Federal-aid projects on a project by project basis.

Major Projects – Projects with an estimated total cost greater than $500 million, or projects approaching $500 million with a high level of interest by the public, Congress, or the Administration.

Oversight – The act of ensuring that the Federal highway program is delivered consistent with laws, regulations and policies.

Performance/Compliance Indicators – These indicators track performance trends, health of the Federal-aid Highway Program, and compliance with Federal requirements.

Stewardship – The efficient and effective management of the public funds that have been entrusted to the FHWA.

3R Project – A project intended to extend the service life of existing highways, bridges, and related appurtenances; and/or restore safe, efficient travel on an existing facility. 3R(resurfacing, rehabilitation, and restoration) work includes the placement of additional surface material and other work necessary to return an existing roadway to a condition of structural or functional adequacy. This may include improving geometric features such as flattening curves, improving sight distance and minor roadway and/or shoulder widening. 3R projects are typically constructed within existing right-of-way, or require only minor acquisitions necessary to enhance safety.

Construction Cost – The cost of a specific project based on the engineer's estimate amount. The construction cost does not include: construction engineering and inspection, preliminary engineering, right-of-way, or utility adjustments.

Force Account – The direct performance of highway construction work by a State transportation department, a city, a county, a railroad, a public utility company by use of labor, equipment, materials, and supplies furnished by them and used under their direct control. 23 CFR 635.203(c)

Preventive Maintenance – In general, any work that 1) prevents the intrusion of water into the pavement or pavement base (crack or joint sealing, underdrains, restoration of drainage systems); 2) prevents deterioration of bridges including painting, scour protection, deck repair, deck drain cleaning, and seismic retrofit; 3) restores pavement rideability by profiling, milling, overlaying, or replacing a portion of the pavement structure.

Section 3 – Stewardship and Oversight of Federal-aid Projects

This Stewardship and Oversight Plan sets forth the respective roles and responsibilities of each party in the administration and oversight of Federal-aid Highway Projects in the State of Mississippi. As a condition to accepting Federal-aid highway funds, MDOT agrees to follow all applicable project and program requirements.

The MDOT and FHWA will utilize electronic signature procedures for requesting and approving Project Authorizations and Project Agreements for each Federal-aid project eligible for Federal-aid funding. On State Delegated (or Administered) projects, submittal of the project authorization to FHWA for electronic signature will serve as MDOT's implicit certification that all applicable requirements are satisfied.

3.1 FHWA Responsibilities

The FHWA is ultimately accountable for all Federal-aid highway projects. The FHWA Mississippi Division will fulfill its stewardship role at a project level as follows:

• Full Oversight Projects – The FHWA will retain full oversight for the following projects:
  • Interstate System (including routes designated as future Interstate) projects with a programmed construction estimate greater than or equal to $2 million.
  • NHS projects with a programmed construction estimate greater than or equal to $10 million.
  • Appalachian Development Highway Program projects, except for those designated as Appalachian Development Highway Program local (APL)

  The FHWA will continue to be responsible for the oversight of all Title 23 aspects of these projects including environmental/location, right-of-way and construction phases. On full oversight projects, the FHWA Division Office personnel will, at a minimum, review and approve project designs, approve Plans, Specifications and Estimates, concur in award, approve changes in contract (change orders, supplemental agreements, time extensions, claims, etc.), conduct project inspections, and prepare a Final Acceptance Report.

  The FHWA may elect to delegate projects meeting the established full oversight criteria to best address the highest risk program elements. Also, the FHWA, at its discretion, may elect to retain full oversight on any Federal-aid highway project. Other projects that may be determined to be full oversight on a case-by-case basis are projects using unique contract procedures such as Design/Build projects, construction of unusual bridges or structures, projects of national significance, projects with high costs, or projects presenting other high risks. FHWA will provide notification to MDOT if this decision is made.

• Involvement on Other Projects – The FHWA may become involved with any Federal-aid project, including those for which MDOT has assumed oversight responsibility. FHWA oversight of State delegated projects will be through program level activities, such as Process Review/Program Evaluations (PR/PE). Additionally, MDOT may request FHWA involvement. The FHWA will provide technical assistance on major unique and/or unusual structures and on non-federally funded Interstate reconstruction projects. On major unique and/or unusual structures, the FHWA will participate in design activities including a review of final plans. On non-federally funded Interstate reconstruction projects, MDOT will request FHWA to approve final plans, any design exceptions, and any Interstate access modifications. FHWA will also provide engineering support for project development and/or construction activities on other projects when requested by MDOT.

• Technical Assistance – The FHWA Division Office is prepared to provide technical assistance to MDOT or local transportation agencies on any aspect of an eligible Title 23 project including intermodal transportation projects. Technical assistance activities will be decided on a case-by-case basis in consultation with MDOT, other partners and the Division office. The FHWA Division Office will continue to focus their time and effort on improving processes and procedures, in cooperation with the MDOT.

• Non-Title 23 Responsibility – FHWA will continue to be responsible for the oversight of applicable non-Title 23 requirements. Such oversight will be conducted through a combination of both project and program level activities. Applicable non-Title 23 requirements include, but are not limited to:

  • National Environmental Policy Act (NEPA) of 1969
  • Section 4 (f) of the DOT Act of 1966
  • Civil Rights Act of 1964
  • Uniform Relocation Assistance and Real Properties
  • Acquisition Policies Act of 1970
  • Disadvantaged Business Enterprise Program (DBE)
  • Clean Air Act Amendments of 1990

The FHWA will manage and provide oversight of Mississippi's Federal-Aid programs in various ways. The methods used will be:

• Routine day-to-day program actions and other interaction.
• MDOT from time to time will ask for Division participation on MDOT task forces, teams, implementation committees, reviews, attendance at MDOT meetings, etc.
• PR/PE reviews on program areas as needed and determined in accordance with the Division's risk assessment process and/or other high importance program areas. PR/PE reviews and CPI activities will be utilized as the primary methods of program oversight. PR/PE reviews comprise the process of comprehensively reviewing and evaluating State and or local agency policies, procedures, practices and controls for the development and implementation of Federal-aid projects and programs.
• The Division office Financial Integrity Review and Evaluation (FIRE) Program to assess the financial aspects of programs and projects.
• Involvement in the development of and ultimately the formal acceptance or approval of various State policies, procedures, and manuals utilized during the development and implementation of Federal-aid projects.

3.2 MDOT Responsibilities

MDOT hereby advises FHWA that it wishes to assume project oversight responsibilities in accordance with the following:

• Interstate Projects – MDOT assumes oversight responsibility for Interstate System projects with a construction estimate less than $2 million and others that the Division elects to delegate to MDOT. All Interstate projects must comply with all Title 23 U.S.C. and non-Title 23 U.S.C. requirements.

• Other NHS Projects (not on the Interstate System, not designated to become Interstate, or not on Appalachian Development highways) – For NHS projects not on the Interstate System or Appalachian Development Highways, MDOT assumes oversight responsibility for the right-of-way approval, utility approval, railroad approval and related activities, design approval, design exceptions, plans, specifications, estimates, contract award, and inspection of projects on the NHS with a construction estimate less than $10 million . All NHS projects must comply with all Title 23 U.S.C. and non-Title 23 U.S.C. requirements.

• Non-NHS Projects – MDOT assumes oversight responsibility for the right-of-way approval, utility approval, railroad approval and related activities, design approval, design exceptions, plans, specifications, estimates, contract award, and inspection of projects not on the NHS. Non-NHS projects are required to be designed, constructed, operated, and maintained in accordance with State law, regulations, directives, safety standards, design standards, and construction standards, in lieu of many Title 23 U.S.C. requirements. Title 23 U.S.C. requirements that are applicable to all Federal-aid projects include, but are not limited to, transportation planning, procurement of professional services, Davis-Bacon wage rates, advertising for bids, award of contracts, use of convict produced materials, Buy America Act provisions and other requirements. All non-NHS projects must also comply with all non-Title 23 U.S.C. requirements.

• Local Agency Projects – The MDOT is responsible for ensuring that appropriate written procedures and guidelines are in place to facilitate the compliance of local public agency administered Federal-aid projects. FHWA will review and approve these practices and procedures for Federal-aid projects. MDOT is responsible for ensuring that all Federal-aid projects administered by local agencies comply with all applicable Federal and State requirements and are administered in accordance with the FHWA approved Local Public Agency (LPA) manual. MDOT is not relieved of this responsibility even though the project may be administered by a local agency.

An Agency Agreement will be executed between MDOT and the local agency to outline the responsibilities of both MDOT and the local agency. The MDOT retains responsibility under Federal law and regulations for all delegated activities and will offer any training, advice, or other assistance as may be needed by a local agency to aid it in successfully completing its Federal-aid project. As such, if the local agency is not following prescribed requirements, MDOT's recourse would be to remove Federal-aid funds from the project.

The following program elements, along with others as specified in the FHWA approved Local Agency Program procedures, will not be delegated to local agencies:

• NEPA/Environmental approval
• Sole Source Approval
• Approval of Force Accounts
• Buy America Waivers
• Design Exception approval
• Certification of Right of Way and utilities
• Approval of Engineering Plans
• Approval of DBE Goals
• Approval and Audit of Labor compliance
• Final Inspection
• Project Acceptance

For those projects that MDOT has agreed to assume oversight responsibility, MDOT will follow all applicable FHWA policies, regulations, Title 23, and non-Title 23 requirements.

Section 4 – Stewardship Roles and Responsibilities for Specific Functional Program Areas

4.1 Environmental Process

In accordance with Section 1309 of TEA-21, the FHWA is the lead federal agency in integrating the full range of environmental requirements under a single, unified process that results in effective and sound transportation decisions. These laws and regulations include NEPA and implementing regulations of the Council on Environmental Quality (CEQ) 40 CFR 1500 and FHWA 23 CFR 771; Section 4(f) of the Department of Transportation Act and implementing regulations 23 CFR 771; Section 106 of the National Historic Preservation Act and implementing regulations 36 CFR 800; Section 404 of the Clean Water Act; and Section 7 of the Endangered Species Act, as well as others.

For all projects that require an action to be taken by FHWA, the Mississippi Division and MDOT will work together to ensure compliance with NEPA and other applicable laws before an alternative is selected (location/design approval). The level of involvement is commensurate with the level of the environmental impacts or project complexity and will depend on the project environmental documentation class.

Table 1 shows a list of MDOT and FHWA project actions related to the environmental process. The successful administration of the Federal-aid Highway Program is predicated upon MDOT's commitment to the preparation and submittal of fully completed documents in accordance with established guidelines, formats, and procedures. Environmental documents prepared by local public agencies and consultants will first be reviewed and accepted by MDOT prior to being forwarded to FHWA. FHWA's goal is to respond to all submissions as soon as possible and within timeframes shown in the tables.

¹ A re-evaluation of a Draft EIS is required if an acceptable final document has not been submitted within 3 years of the date of the draft EIS circulation, 23 CFR 771.129(a). A re-evaluation of a Final EIS is required if major steps to advance the action have not occurred within 3 years after approval of the final EIS, final EIS supplemental, or the last major Administration approval or grant, 23 CFR 771.129(b). A re-evaluation of a Categorical Exclusion, an Environmental Assessment or a Finding of No Significant Impact (FONSI) is required if three years have elapsed since document approval, last federal action, or if there has been a change that alters validity of document.

Performance/Compliance Indicators:

Performance measure reporting will be completed jointly by FHWA and MDOT. The following performance indicators will be used to assess the health of the Environmental program:

1. Environmental Protection Agency (EPA) EIS Ratings
   Indicator: The rating that EPA provides on draft EIS documents.
   Reporting Instrument: A list of all DEIS documents completed in the reporting period identifying the EPA rating along with a project description.
   Reporting Frequency: Annually by October 14 for the FY

2. Completion Time for Environmental Documents
   Indicator: Completion time for an EA measured from the date of the project initiation (written determination of document classification) to FONSI. Completion time for an EIS measured from the date of the NOI to issuance of the ROD.
   Reporting Instrument: A Division maintained list of EAs and EISs completed identifying the length of time.
   Reporting Frequency: Annually by October 14 for the FY.

4.2 Right-of-Way Process

All Federal, State, and local public agencies (and others receiving Federal financial assistance for public programs and projects requiring the acquisition of real property) must comply with the policies and provisions set forth in the Uniform Act and its amendments. The current regulations implementing the Uniform Act were first published in the Federal Register of March 2, 1989, and are codified in the Code of Federal Regulations, Title 49, Part 24. These regulations contain the standards and procedures that acquiring agencies must follow in their appraisal, acquisition, and relocation assistance programs.
Additionally, state and local public agencies using federal funds for transportation programs administered under Title 23 U.S.C. must adhere to the regulations contained in Title 23 U.S.C. 710 in the administration of their Right-of-Way (ROW) programs.

The following oversight functional areas involving the Federal-aid ROW program are covered under 49 CFR (24), which has no provision for exemptions under Title 23 U.S.C.:

• Appraisal / Appraisal Review
• Acquisition
• Relocation

The work activities listed below are covered under 23 CFR (parts are listed in parenthesis) and require specific approval and/or oversight by FHWA:

• State ROW operations manual (710.201)
• ROW authorization (710.307)
• Air rights on the interstate (710.405) & NHS (710.201)
• Airspace leases/joint use agreements (710.407)
• Sale/transfer of excess ROW (710.409)
• Early acquisition, protective buying, and hardship (710.501 & 503)
• Functional replacement (710.509)
• Federal land transfers (710.601)
• Highway beautification (750)
• Indirect costs (part 710.203 (d) subpart B)

The work activities listed below are covered in 23 CFR and do not require specific program or project approvals, but are not exempted from FHWA oversight under Title 23 U.S.C.:

• Direct eligible costs including administrative, legal and court settlements (710.203 (b))
• Real property donations (710.505)

In addition, adherence to Mississippi State Code must be taken into consideration. Even though there are no exemptions under the law for any functions covered in 49 CFR 24, for practical purposes there are two levels of review of those elements. One level depends on whether the project involves ROW acquisition and has Federal-aid in other phases of work but none in ROW. The second level depends on whether there is Federal-aid in the ROW project phases. Although the ROW regulations must be followed under both levels, there is less concern about the reasonableness of the actual dollar expenditures in those projects containing no Federal-aid in the ROW. The primary concerns with these projects are to protect the rights of property owners and displaced persons.

For the second level of projects, there is a dual concern for the rights of property owners and displaced persons and the stewardship of the federal dollars. Continuous review of the State's activities has proven to be an effective means of assuring that the rights of owners and displaced persons are protected as well as monitoring the expenditure of federal funds. This will be continued under this stewardship plan. Process reviews and program evaluations will be conducted when needs or trends are identified at either of the above project levels. The reviews will be conducted jointly with MDOT personnel whenever possible.

Local Public Agencies (LPAs), i.e., cities and counties, are required to comply with the Uniform Act and its governing regulations found in 49 CFR 24 in the same manner as MDOT. As stipulated in 23 CFR 710.201(b), MDOT is responsible for assuring that ROW projects by local public agencies are completed in compliance with Federal and State laws and regulations. FHWA in conjunction with MDOT-ROW staff will review LPA projects on an as need basis.

Table 2 shows a list of MDOT and FHWA project actions related to the right-of-way process. Periodic product evaluations such as reviews of conveyance instruments and maps, examination of right of way parcel files or other work products will be conducted to ensure that the current process is producing quality products in conformance with policy. If any problems are identified, a process review may be scheduled. Process reviews will be the method for evaluating compliance and effectiveness in each of the program areas.

Certain ROW activities are not covered specifically by either 49 or 23 CFR but are a combination of sound business practice and the occasional national emphasis areas, which affect the ROW program. Joint reviews of these topics and their application will be conducted as needed.

Performance/Compliance Indicators:

Performance measure reporting will be completed jointly by FHWA and MDOT. The following performance indicators will be used to assess the health of the ROW program:

1. Conditional Certifications
   Indicator: Number of Federal-aid projects with conditional ROW Certifications (evaluated on statewide basis)
   Reporting Instrument: A list of all Federal-aid projects authorized in the reporting period and the number of projects with conditional ROW Certifications
   Reporting Frequency: Annually by October 14 for the FY

2. Condemnations
   Indicator: Percentage of condemnations not exceeding 25% of the parcels acquired during the reporting period (evaluated on statewide basis)
   Reporting Instrument: Uniform Act Relocation Assistance and Real Property Acquisition Statistical Report as required by 49 CFR 24, Appendix B
   Reporting Frequency: Annually by October 14 for the FY

4.3 Design Process

The purpose of a design monitoring program is to establish procedures for assuring that Federal-aid projects are designed in accordance with 23 CFR Part 625 Design Standards for Highways, 626 Pavement Policy, 627 Value Engineering, 630 Pre-construction Procedures, 633 Required Contract Provisions, 645 Utilities, 646 Railroads, 650 Bridges, 652 Pedestrian and Bicycle Accommodations and Projects, 655 Traffic Operations, 771 Environmental Impact and Related Procedure, and 772 Noise. It is FHWA policy that FHWA personnel make sufficient reviews of Federal-aid projects to assure they are designed in accordance with applicable standards and in consideration of appropriate cost-effectiveness strategies. All projects on the NHS, regardless of funding source, must follow FHWA approved AASHTO design standards.

For Federal-aid projects on the NHS, including the Interstate System, the primary objectives of the design monitoring program are:

• To promote improved safety through appropriate use of design standards and guidelines.
• To make value added input at appropriate points in the project development process, with emphasis on early involvement in the project decision making process.
• To maintain a close working relationship between FHWA and MDOT project development personnel.
• To ensure the integrity of the Interstate system through the review and approval of Interstate access point additions or modifications.
• To promote context sensitive solutions concepts
• To ensure that environmental commitments are incorporated into projects.

The types of design reviews that will be undertaken by FHWA include:

• Early Planning Reviews: Early involvement maximizes FHWA's opportunity to participate in design decisions with the goals of promoting safety and preserving human and natural environment. FHWA's participation in developing possible transportation solutions or concept development meetings, prior to any public meetings, should be included on Federal-aid projects of a scope that is likely to require an Environmental Assessment or Environmental Impact Statement, or a FHWA full oversight project.

• Intermediate Reviews (Conceptual Plans, Field Review Plans and Office Review Plans): These reviews are appropriate during the time the design concepts and major design features are being developed and finalized. The purposes of intermediate reviews are to assure that appropriate design considerations are used during layout development, to assure that environmental commitments are observed, to assure cost-effective design alternates are considered, to maintain communication with the highway agency, and to evaluate the quality of the product. On complex projects an onsite plan-in-hand review should be conducted and a review team approach considered. FHWA will participate in intermediate reviews after a project has been designated as full-oversight.

• Plans, Specifications and Estimate (PS&E) Reviews: These are the last reviews in the preparation of project documents, allowing project authorization to take place. The reviews may utilize a checklist approach and should generally not involve a design review if there was adequate FHWA involvement during the intermediate reviews leading up to the final plans. These reviews are required on all FHWA oversight projects to assure that the project is ready for authorization.

• Design Process Reviews/Program Evaluations (PR/PE): These are reviews that evaluate the adequacy of the processes and procedures used by MDOT on design activities. Their purpose is to provide oversight and control of design methods, techniques, procedures and policies on a statewide or area wide basis. Process reviews can be broad in scope, covering a major design activity such as conceptual studies, preliminary plan development, or PS&E preparation, or they can be more specific, covering such elements as geometrics, pavement design, safety, structures, etc. All process reviews should include a sufficient sampling of actual products and/or projects to assure that the process is producing the intended results. As appropriate, State delegated and FHWA full oversight projects will be included in the sample of projects inspected as a part of process reviews.

• Design and Operation Reviews: These reviews are undertaken for recently completed projects to evaluate the effectiveness of current design policy and detect design features that can be improved. The reviews should be conducted using a team approach with representatives from various functional areas. Projects should be open to traffic before being considered as candidates for a design and operation review.

On Federal-aid projects where MDOT has the delegated authority to act for FHWA in design monitoring, a similar type of program of independent reviews will be conducted. MDOT administered projects are subject to joint FHWA-MDOT process reviews and inspections and must comply with applicable Federal requirements. For Federal-aid projects off the NHS, the objective of the design monitoring program is to ensure that non- Title 23 U.S.C. requirements are met.

Along with the general items listed above for FHWA project review, the following are specific requirements for bridge projects:

• For new or reconstruction bridge projects on the Interstate system (bridges that carry interstate traffic and interchange bridges), preliminary bridge plans as well as final plans, specifications and estimates (PS&E) will be submitted to FHWA for review.

• For new or reconstruction bridge projects that carry traffic over the Interstate Highway regardless of funding source, preliminary bridge plans will be submitted to FHWA for the purpose of evaluating horizontal and vertical clearances on the Interstate system.

• FHWA may elect to retain full oversight on Federal-aid projects involving unusual structures. Unusual structures may include tunnels, structures featuring new or complex wall systems, structures that involve complex stream stability countermeasures, or designs that are atypical or unique. Unusual bridges may include unique foundation problems, complex designs with unique features, bridges with exceptionally long spans, or bridges being designed with procedures that depart from currently recognized acceptable practices.

• FHWA will be available for technical assistance on all Federal-aid and non-Federal-aid bridge projects.

¹ FHWA approves design exceptions for all Interstate and Appalachian Development Projects. This includes both full oversight and State delegated projects. Chief Engineer approves all other design exceptions.
² Engineering and Operations Analysis is required for new or modified Interstate Access. This includes both full oversight and State delegated projects.
³ FHWA must approve for all bridges over the Interstate regardless of funding source
⁴ FHWA must approve New Standard Drawings for use on NHS projects

Performance/Compliance Indicators:

Performance measure reporting will be completed jointly by FHWA and MDOT. The following performance indicators will be used to assess the health of the Design program:

1. For all Federal-aid projects, percent of PS&E's that have all necessary documentation at day of advertisement.
2. Percent of interstate access modifications that demonstrate reduced congestion. Goal 100%.
3. Value Engineering annual summary done in accordance with federal requirements.

4.4 Intelligent Transportation Systems (ITS) Projects

The applicable legislation for ITS projects is 23 CFR 940 Intelligent Transportation System Architecture and Standards. This section of 23 CFR describes the regulations that must be followed for projects that contain ITS components.

ITS Regional Architecture – 23 CFR 940.9 An ITS regional architecture shall be developed to guide the development of specific projects and programs.

Systems Engineering Analysis – 23 CFR 940.11 All ITS projects shall be based on a systems engineering analysis. The applicable regional ITS architecture shall be used in the development of ITS projects. The analysis should be on a scale commensurate with the project scope.

Project Administration – 23 CFR 940.13 Prior to authorization of Federal-aid funds for construction or implementation, the project sponsors shall demonstrate that ITS projects conform to the system engineering and conformity requirements provided in 23 CFR 940.11 and that there is a commitment to the operations, management and maintenance of the overall system.

Note:
The FHWA will retain full oversight for ITS projects meeting the following criteria:

• Interstate System projects (including those on routes designated as future Interstate) with a construction estimate greater than or equal to $2 million.
• NHS projects with a construction estimate greater than or equal to $10 million.
• Appalachian Development Highway Program projects

All other ITS projects are to be State Delegated, where as, MDOT is to act on behalf of FHWA in ensuring that all 23 U.S.C. or 23 C.F.R. requirements are met. In addition, FHWA reserves the right to conduct reviews, as appropriate, to confirm that the Federal-aid program is being administered in accordance with the applicable laws and regulations and may request full oversight of any ITS project funded through Federal-aid funding. For ITS Congressional Earmarks, FHWA will monitor pre-award activities to ensure that the project being pursued meets program purposes, non-Federal match, and other requirements. Once the project is approved and a project agreement executed, Federal oversight will be conducted as identified in the above Table 4.

Performance/Compliance Indicators – To ensure that all agencies with federally funded ITS projects have "Ready For Use" Regional ITS Architecture (RA) or Project Architectures in conformance with 23 CFR 940, the MDOT will submit to the FHWA Division Office a semi-annual report, no later than March 31 and August 31, listing all ITS programmed projects. The list will include:

• Project description
• Fiscal year programmed
• Amount funded
• Project location
• Status of the region's regional ITS architecture
• Whether the project listed in the region's regional ITS Architecture. If the region has no regional ITS architecture, the date the region's first ITS project advanced to final design.

4.5 Construction Authorization and Monitoring Process

FHWA Authorization to advertise the physical construction for bids or to proceed with force account construction thereof shall not be given until all of the following conditions have been met in accordance with 23 CFR 635.

• PS&E is complete and ready for advertisement
• ROW Certification
• Utilities Certification
• Railroad Agreements obtained
• Permits obtained
• Environmental documents approved and appropriate environmental commitments have been included in the PS&E.

Occasional exceptions may be made to the ROW, utility, and railroad requirements above when meeting one or more of these conditions are not "feasible or practical." In these cases, the PS&E must adequately account for these exceptions.

For full oversight projects, MDOT will provide all required documentation to FHWA Division Office at least 10 business days prior to the date authorization is requested. All documentation will be provided to FHWA in a single submittal. A PS&E Project Checklist should be used to facilitate this submittal. If it is not feasible or practical to submit any required documentation with the submittal, a status of this documentation will be provided with the submittal. FHWA will review the project documentation to assure that all project requirements are met. For projects on the NHS with state delegated oversight, the MDOT will ensure that all applicable requirements have been met and that the project was developed in compliance with this agreement and all applicable laws and standards.

In general MDOT has responsibility for the construction of all Federal-aid projects and for ensuring that such projects receive adequate supervision and inspection to ensure that Projects are completed in conformance with approved plans & specifications. The primary objectives of the FHWA construction-monitoring program are:

• To evaluate MDOT's control of the projects and the quality and progress of work
• To maintain a close working relationship with MDOT construction staff
• To promote quality improvements
• To promote work zone safety
• To assure that projects are completed in reasonably close conformance with the approved plans and specifications and approved changes
• To ensure incorporation of environmental commitments

FHWA will use the following types of inspections to obtain these objectives:

• Process Review/Product Evaluation (PR/PE) – comprehensive reviews to evaluate MDOT's procedures and controls. The purpose of a PR/PE is to provide oversight of MDOT construction and materials management activities and to determine compliance with Federal-aid requirements on a statewide or District wide basis.
• Inspection-In-Depth – a thorough on-site review to evaluate a specific contract item, combination of items, or major phase of a project. Inspections-in-depth may be accomplished on an individual project basis or on several projects with the findings summarized as a District wide or statewide review.
• Project Inspection – an on-site review to evaluate MDOT's activities, the quality and progress of the work, incorporation of environmental commitments, and if appropriate, to follow up on findings from previous inspections.
• Final Inspection – A review to determine the extent to which MDOT has exercised its control to assure that the project has been completed in reasonably close conformance with the plans, specifications, and authorized changes, including implementation of environmental commitments.
• Operational Review – The intent of these inspections is to observe a recently completed project with a multi-disciplinary team to identify opportunities for improvement that may be incorporated in future projects. These reviews also provide the opportunity to identify items that worked very well in addition to noting deficiencies.

Title 23 requirements apply to all projects on the NHS regardless of oversight process. Non-Title 23 requirements apply to all projects and are subject to review regardless of oversight process.

Performance/Compliance Indicators

Performance measure reporting will be completed jointly by FHWA and MDOT. The following performance indicators will be used to assess the health of the Environmental program:

1. Percent of change orders that contain necessary supporting documentation for the (1) reason for the change, (2) the cost(s) of the change, and (3) any additional contract time that may be necessary for the change. Goal = 100 percent.
2. Project cost and time overruns.

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