These Questions and Answers represent the Federal Highway Administration's (FHWA) thinking regarding the scope and details of the SAFETEA-LU Section 6004, State Assumption of Responsibility for Categorical Exclusions. Section 6004 of SAFETEA-LU is now codified as 23 USC §326.
FHWA coordinated with the Federal Transit Administration (FTA) in developing this FHWA-only guidance. A State seeking to assume responsibility not only for highway categorical exclusions (CEs), but also for transit CEs is referred to section 8 of these Q and A's below regarding transit considerations and the involvement of FTA in such case.
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23 USC §326 does not require that states assume CE responsibilities. Similarly, it does not require that existing programmatic CE agreements be amended if States do not assume any additional responsibilities or liabilities under 23 USC §326. Further, the provisions of 23 USC §326 do not limit the ability of States and Division Offices to develop or continue existing agreements to administratively satisfy NEPA responsibilities.
No, these activities would meet the definition of indirect costs in accordance with OMB Circular A-87, [now the common grant rule, 49 CFR 18.22(b)]. According to the general principles of Federal appropriation law, Federal funds can only be obligated for the purposes authorized by Congress. Since indirect costs are not specified as a purpose of any Federal-aid program, it is not appropriate for the FHWA to authorize a specific project for indirect costs.
No, 23 USC §326 does not require that new regulation be promulgated or any existing regulation be revised. A signed MOU is sufficient for implementation with the caveat that State must certify that it consents to and accepts the jurisdiction of the Federal courts for matters relating to the MOU. This acceptance waives the State's immunity under the Eleventh Amendment to the US Constitution [also see section 6(e) below]. Note, a State may need legislation to make this waiver.
Scope of the CE Responsibly Assumed by the State
The list of projects in the 23 USC §326 MOU is important because the State can be assigned the responsibility for categorical exclusion determinations for only these listed projects. Projects must either already be determined to be CEs, such as those listed in 23 CFR 771.117(c), or ones that FHWA has determined meet the regulatory definitions of CEs by complying with 771.117(a), subject to the requirements of 771.117(b). Accordingly, the list of projects in 771.117 (d) contains 12 examples of projects that may be designated as CEs. In addition, Division Offices and FTA Regional Offices may determine and list [in Stipulation I(B)(3)] other types of projects in the MOU that are CEs under 771.117(d) if there is documentation based on past evaluations or studies that those types of projects are CEs. Division Offices and States may include in the MOU the lists of activities in existing programmatic CE agreements. The scope of the activities where responsibilities are assigned may be further limited by any exclusions or thresholds required by the Division Office or FTA Regional Office (see Question 2.c. below).
Activities listed in the MOU appendix as part of Stipulation I(B)3 must be CEs based on data from past project documentation. Such documentation includes the programmatic CE agreement itself, how long the agreement has been in effect, and reports of its monitoring or oversight (process review). The documentation of the monitoring or oversight of the CE agreements should state whether or not any issues or concerns were identified as a result of treating the listed activities as CEs. States also may identify other activities not already listed in their programmatic CE agreements that may be designated as CEs. By their inclusion in the MOU such activities become "designated," and assignable under the MOU. Documentation in support of these added activities needs to include the rationale for being a CE and a discussion of the history and experience with regard to individual or cumulative impacts on the environment.
Yes, transit or multi-modal projects can be included in the 23 USC §326 MOU. If they are included, the FTA Regional Office must participate in the development of the MOU and be a signatory. The 23 USC §326 delegation is to the State only and not to transit agencies that are not State agencies. Section 8 of these Q and A's (below) addresses transit considerations.
The list of CE projects in the MOU are ones whose responsibilities are assigned to the state unless exceptions are identified by the Division Office and specified in the MOU. This exclusion from assignment may be based on a project's potential impact exceeding a defined threshold. For example, a Division Office may elect to exclude projects based on right-of-way and relocation impacts. If one or more thresholds or limits were exceeded, the CE responsibilities for that project would be retained by FHWA. The types and magnitude of the thresholds would be negotiated between the Division Office and the State and must be stipulated in the MOU.
CE projects that are either not listed in the MOU or that are excluded from the MOU because they don't meet one or more stipulations should be processed according to the procedures in place prior to the execution of the MOU. Such procedures could include those specified in a programmatic CE agreement. At a later date, the Division Office and the State DOT may agree additional activities are CEs that should be assigned to the State, and can amend the MOU to add them to the designated activity list.
The State DOT will apply the criteria specified in the MOU and they will determine whether a project is included or excluded from the MOU. It is possible that a State DOT may initially process a project under the MOU but decide later to exclude the project because it does not meet CE criteria. Once the State determines that a project is not a CE, the final decision to prepare an EA versus an EIS rests with the Division Office.
FHWA will not intervene, broker, act as intermediary, or be involved with another Federal or State agency or the public with respect to a project for which the State has assumed responsibilities under the MOU. As long as the State is satisfying its MOU responsibilities for the project, FHWA or FTA would not play a dispute resolution role. However, if a dispute arises from actions of the State contrary to the MOU responsibilities assigned, FHWA may submit comments to the State or decide to exclude the project from the MOU if the State has not complied with MOU responsibilities. The performance of the State in handling of such projects shall be considered in monitoring the provisions of the MOU and in deciding whether to amend, terminate, or renew the MOU.
The agreements can remain in force. The template MOU includes language in Stipulation I(C) that states that the MOU supercedes the existing programmatic CE agreement to the extent that it conflicts, and yet remains in effect for matters not covered in the MOU. It also states that CE projects that are excluded from the MOU, may be processed pursuant to a programmatic CE agreement.
Section 6004 is a permanent, renewable program that does not require any rulemaking. It relies on a less formal approach to monitoring rather than semi-annual publicly available audits that are required in Section 6005. A State may implement Section 6004 by executing a MOU sooner compared with Section 6005 because Section 6005 has a requirement for application rulemaking. Accordingly, States may find that the administration of Section 6004 is more efficient. Section 6004 allows assignment of responsibilities for transit or multimodal projects; Section 6005 applies only to highway projects.
The intent of the assignment of CE responsibilities in 23 USC §326 is only to the State or an agency of the State. Thus, the State will not be allowed to further delegate environmental decision making responsibilities to a county, city, municipality, local transit agency, or private entity. Each State agency that participates in the delegation by assuming responsibilities and liabilities would need to be identified in the MOU and included as a signatory to the MOU.
No. The MOU must clearly define the scope of responsibilities assigned. However, if after a period of time, the Division Office agrees to assign additional responsibilities not specified in the executed MOU, a provision exists in the MOU that allows the agreement to be amended. Otherwise, additional responsibilities may be identified when the MOU is considered for renewal.
Transitions
Immediately after the signatories execute the MOU, the State may exercise the provisions to assume responsibilities. There is no transition period. For other assigned environmental responsibilities, the State and FHWA should discuss whether immediate State assumption of responsibility is appropriate for a project if FHWA has already taken certain actions. For example, if FHWA has already begun Section 106 consultation with the SHPO and other parties for a specific project, FHWA and the State should discuss the appropriateness of the State immediately assuming the Federal Section 106 responsibility.
The MOU allows FHWA to intervene and exclude a project from the MOU, following notice and a 30-day period. This could happen at any point prior to the approval of the project. The State and the Division Office have an opportunity to resolve any issues during the 30-day period. The FHWA decision of whether or not the project should be excluded is binding after the 30 days. The MOU specifies that the State will cooperate to make the transfer of responsibilities back to FHWA orderly and efficient.
Monitoring/Oversight/Termination
The FHWA oversight role under 23 USC §326 is to monitor compliance by the State with the MOU and the provision by the State of adequate financial and staff resources to carry out the MOU. The template MOU identifies FHWA oversight as quality assurance in the State's overall performance rather than project-by-project consideration. Oversight is exercised when FHWA becomes aware of a MOU performance problem. In that case, the MOU stipulates that FHWA will evaluate the situation. FHWA may intervene in a project to either facilitate a solution to the problem or exclude a project from the MOU, or terminate a MOU responsibility and return the project or responsibility to FHWA.
The 23 USC §326 MOU requires that the State maintain administrative files with all letters and comments from governmental agencies and the public and administrative information either in paper or electronic form. The State's files are subject to FHWA inspection at any time and are available to the public consistent with the requirements specified in Section 6004 of SAFETEA-LU [section 552 of title 5 and NEPA]. The State will submit a report of its performance under the MOU to FHWA at least every 12 to18 months. FHWA will review the State's records and evaluate its performance under the MOU every 12 months.
Section 6004 of SAFETEA-LU does not change or modify the requirements, standards, or processes in existing regulations with the exception that for projects included in the MOU, the State is deemed to be a Federal agency. Compliance with requirements, standards, and processes requires the State to provide adequate organizational and staff capability and expertise to effectively carry out the responsibilities assigned. This may be met by maintaining staff or through consultant services. The State must have the financial and staff resources to carry out the MOU. Resources, capability, and expertise that pertain to MOU performance will be monitored by FHWA and can be considered as a basis for termination or renewal of the MOU. Division Offices are encouraged to include state-specific performance measures in the MOU.
The entire MOU or a part of the MOU may be terminated by mutual agreement. FHWA may terminate the MOU without State consent if FHWA determines that the State has failed to adequately meet the MOU requirements. The State may terminate the entire MOU unilaterally for any reason.
Termination proceeds first with a notice requesting termination. The parties would then have 30 days to attempt to resolve the issue or problem before the MOU would be terminated. A special MOU stipulation allows FHWA to terminate the MOU without notice or consultation in extraordinary circumstances where a State is seriously remiss in carrying out its responsibilities under the MOU.
The Division Office should evaluate a project if it discovers an issue that may be non-performance of a provision in the MOU. This evaluation is a form of monitoring the MOU. The Division Office may contact the State to see if corrective action is appropriate or to request additional information. If FHWA considers the concern to be unresolved and significant, the Division Office should exclude the project from the MOU and reassume responsibilities. Alternatively, the Division Office could choose to address the concern as part of monitoring at the time the MOU is renewed.
The Division Office is not required to terminate the entire MOU based on non-compliance of one or more responsibilities. It is possible for FHWA to terminate a specific environmental responsibility (for all projects) or exclude the assignment of responsibilities for an individual project. Any modification to overall responsibilities of the State would require that the MOU be amended, but if the change is a termination of some or all responsibilities then the notice and comment requirements in Stipulation VI do not apply. No amendment to the MOU is necessary to exclude a project or a specific responsibility for an individual project. However, the failure of the State to fulfill its responsibilities, even if the deficiency is in only one of a number of responsibilities assigned, could be cause for termination of the MOU by the Division Office. But correcting the chronic deficiency is in the best interest of all parties. Except under Stipulation X(B), any time there is a request for termination of MOU responsibilities (or the entire MOU) or to exclude a project from the MOU, a 30-day period is triggered after notice for the State to resolve and correct any deficiency.
Assignment of other Federal responsibilities relating to other Federal laws
The context of Section 6004 in SAFETEA-LU and its placement within the environmental provisions indicate the scope of assumed responsibilities is limited only to environmental laws and regulations. Regarding protective buying or hardship acquisition activities that are defined to be CEs, the CE approval may be assigned to the State in the MOU but not the approval to authorize real estate purchase.
The authority to conduct government-to-government consultation with Indian tribes is specifically excluded from responsibilities assignable to States in 23 USC §326. This consultation is a Federal obligation and is implemented in compliance with Section 106 of the National Historic Preservation Act or actions that entail treaty obligations. Some States have executed agreements with Indian tribes that allow the FHWA Division Office to administratively delegate government-to-government consultation tasks to the State. There is no reason to modify existing procedures, especially if they are working well. However, government-to-government consultation could identify Tribal concerns in a specific project. In the case where a Tribe raises a concern that is not resolved in the opinion of the Tribe or FHWA, FHWA can intervene to exclude the project from State assumption of responsibilities. FHWA would then resume their role with respect to all aspects of the project and can address the concern as an "agency official" in accordance with Section 106.
Division Offices should begin by examining the record of the State DOT's compliance with environmental laws and regulations. How well has the DOT performed this compliance? Are there written procedures or protocols? Are sufficient personnel allocated for compliance tasks and is their training and experience adequate, i.e., do the individuals meet the professional qualification standards such as those established by DOI for working on Section 106 compliance? Division Offices have the option to spell out in the MOU specific commitments by the State to devote the range of environmental staff appropriate for the responsibilities assumed by the State through in-house staff or by hiring consultants. 23 USC §326 suggests that the adequacy of State financial resources is to be considered by FHWA in deciding to assign responsibilities and monitoring the provisions of the MOU. Evaluation of State allocations for environmental compliance over the past 2-3 years may provide a good measure of the adequacy of available resources. Finally, another determinant of whether environmental responsibilities should be assigned to the State is the quality of the relationships that currently exist between the State DOT and the State and Federal resource agencies involved in environmental compliance.
Yes, but see below. For CE projects that have been delegated according to the provisions of the MOU, but for which FHWA has retained a portion of the responsibility for environmental compliance, and, based on information about the project compliance FHWA believes the project would be more appropriately considered as an EA or EIS, then the State would be obligated to consider FHWA's comments in its CE determination. However, the responsibility for making the determination that the project is a CE rests with the State. The Division Office and the State will need to develop procedures for State determination of CEs where FHWA retains responsibilities for compliance with part of other Federal laws. The State would make the decision on the class of action, but when FHWA comments, the State would be required to document the basis for its CE determination.
Yes it can. For projects where Section 4(f) responsibility is assigned, the State would make all Section 4(f) decisions. For CE projects, it is likely that most Section 4(f) approvals would be covered by the programmatic evaluations or the new "de minimus' provision in Section 6009 of SAFETEA-LU. FHWA Division Offices may want to include a provision in the MOU that the State be familiar with and capable of carrying out the Section 4(f) requirements and the preparation of Section 4(f) evaluations (through experienced personnel and recurrent training). This would include retaining qualified legal counsel to perform legal sufficiency reviews.
The State would take on the role of FHWA in consulting under Section 7 of the Endangered Species Act.
Memoranda of Agreement, MOUs, and Programmatic Agreements executed prior to the 6004 MOU by FHWA Division Offices and State DOTs involve third-party agencies. Division Offices and State DOTs must contact those third parties to discuss changes in roles and responsibilities the MOU might have on these prior agreements. Depending on the specified role of FHWA in the prior agreements third parties may consent to continue the agreements and that there is no requirement that these agreements be changed. That consent should be documented in a letter signed by the parties. For purposes of clarity, some third parties might request that their agreement be amended to address the instances where the State has assumed FHWA responsibilities. Alternatively, but not necessarily in the best interest of all parties, the third party may insist that when the State is following the MOU it is acting outside of the prior agreement. A specific agreement that might require amendment might be a MOA or MOU, or State Rules in the "Conformity State Implementation Plan" that govern project-level transportation conformity. Since these are adopted as State requirements, State DOTs may have to revise them before they could assume project-level transportation conformity responsibilities.
For delegated responsibilities, the State DOT would be subject to the same requirements that are applicable to FHWA. Under the MOU the State also must comply with any future Executive Orders applicable to environmental review. FHWA would be responsible for communicating the new requirement to the State DOT, and the State DOT may seek an amendment of the MOU to clarify its responsibilities with respect to a new Federal requirement.
Legal/Litigation Matters
No. The Federal government has no liability or responsibility for actions or decisions that it has assigned and have been assumed by the State. In certain cases, the U.S. Department of Justice may file an amicus brief or participate in other ways to ensure that the national interest is protected when a State defends its NEPA decisions. The MOU gives the FHWA and U.S. Department of Justice the right to review and approve any proposed settlement of a lawsuit. Settlement of pre-litigation claims also requires FHWA approval if the State wishes to preserve the option of Federal-aid eligibility for expenses arising from the settlement agreement.
FHWA reserves the right to intervene in any action or proceeding arising out of the performance of MOU responsibilities and that does not limit the State's liability. For projects where FHWA has retained a part of its environmental review responsibilities, FHWA might participate as a necessary party. The State is required to defend all claims brought in connection to its actions or responsibilities.
No. If the State has been assigned the responsibility for legal sufficiency reviews for 4(f) evaluations, the State is expected to perform this review.
No, but with a qualification. FHWA has an option to intervene in a project if the dispute arises from the State's non-compliance with the MOU. If the public or a Federal agency contacted FHWA with a comment on a project assigned to the State, FHWA would consider such comments when considering whether the MOU should be amended, terminated, or renewed.
Section 6004 of SAFETEA-LU provides the legal basis for the delegation on the Federal side, which must be accepted by the State in order to be assumed. To assure that the State can legally accept this responsibility, the template MOU contains a State certification of jurisdiction. Also, the MOU requires that either the State's Attorney General sign the MOU or provide a letter stating that the State can waive its sovereign immunity and that the individual is authorized to enter into the MOU. The letter or signature by the State Attorney General (or equivalent) is to ensure the assumption of Federal responsibilities and acceptance of the terms of the MOU is authorized by State law.
MOU
Not likely. The template MOU should allow consistent development of the MOUs and provide the "core" stipulations or requirements, including provisions for evaluating and monitoring the State's performance. However, the details such as which CE activities are assigned, whether or what CE thresholds are established, and what other environmental laws are assigned will vary from State to State.
Once the MOU has been drafted and prior to its execution, the State shall (at a minimum) publish notice of the availability of the draft in newspapers of statewide circulation and indicate a period of 45 days in which to receive comments. Any additional notice by the State would be in accordance with the public notice law of the State. The Division Office is responsible for the Federal Register notice of MOU availability and comment. Prior to execution of the MOU, both the State and the FHWA Division Office shall consider the comments received during the public comment period. Subsequent MOU amendments that expand State responsibilities or add CE designations also will be subject to notice and comment.
In the spirit of building and maintaining closer relationships with other Federal and State agencies (i.e., US Army Corps of Engineers, Fish and Wildlife Service, the State Historic Preservation Office), Division Offices are strongly encouraged to informally consult early in the development of the MOU. The goal of such consultation would be to identify and address possible legal and procedural complications that if not identified while the MOU is being drafted, could arise late in the process and delay or derail the execution and implementation of the MOU. The FHWA Division Offices also would gather the comments from Federal agencies with the publication of a notice in the Federal Register, that a MOU has been drafted. As part of the final review of the draft MOU, the FHWA headquarters would review the draft and provide a copy and any documentation for activities in the MOU appendix to the Council on Environmental Quality. FHWA Headquarters will solicit views on the template MOU from other Federal resource agencies, including through the Executive Order 13274 Task Force. States that have previously executed agreements to address environmental coordination and compliance need to include FHWA in meetings with third party agencies to explain how prior agreements should address the MOU, either before execution of the MOU or within 6 months of its execution.
No template MOU covering both highway and transit CEs has been prepared as part of the initial release of guidance. If FHWA and FTA wanted to assign responsibilities for both highway and transit CEs to the State, the parties would revise the template MOU for highway CEs and add in transit CEs and assign roles for the additional parties involved. The first such multimodal MOU would then be used as the template for subsequent multimodal MOUs.
In order to execute an MOU the Division Administrator needs to have a final and complete MOU that has been subject to review by the field counsel in the Office of the Chief Counsel and the FHWA headquarters. If the MOU contains activities to be designated in the MOU as part of Stipulation I(B)(3) [i.e., activities not already specifically listed in 771.117(c) or (d)] documentation supporting a determination that the activities are CEs will need to be prepared and sent to the FHWA headquarters with the draft MOU. FHWA HQ will consult with the Council on Environmental Quality (CEQ). The Division Administrator needs to have a notification from the FHWA headquarters that the FHWA headquarters review is complete. Lastly, the Division should have either the documentation required from the State's Attorney General, or the understanding that the State's Attorney General will sign the MOU.
FHWA and FTA expect much more frequent application of 23 USC §326 to highway CEs alone than to highway and transit CEs together, although a few of the latter are expected. For simplicity, only FHWA's roles and responsibilities are discussed in the above Q and A's. In the case of a multimodal MOU, FTA would assume the same the roles and responsibilities for the transit CEs that FHWA has for highway CEs. If one keeps this FTA role in mind, the Q and A's above generally apply to State assumption of both highway and transit CEs. Additional questions arise when transit CEs are involved, as follow.
In drafting Section 6004, Congress did not specify a single mode or a single U.S. DOT agency to which the section would apply; rather it allowed any CE under the purview of FHWA and FTA to be assigned to a State. This wording contrasts with Section 6005, for example, which explicitly limits its application to highway projects. Although 23 USC §326 provides broad discretion on what CE projects may be assigned to a State through an MOU, it clearly limits such assignment to "States." The numerous FTA grantees that are agencies of local government or are transit authorities directed by a board of public officials separate from the State government are not considered State agencies for purposes of implementing 23 USC §326. Nevertheless, some State DOTs have expressed an interest in assuming responsibility not just for highway CEs but also for transit CEs within the State.
FTA anticipates several situations where a State DOT might seek CE responsibility for certain transit projects:
(1) State DOTs are the direct recipients of transit grants from several FTA programs, such as the Non-Urban Formula Program (49 USC 5311) and the Elderly and Disabled Program (49 USC 5310). Where a State DOT is assuming CE responsibility for highway projects, it may decide also to request inclusion of transit CEs for projects funded through these State-directed FTA programs.
(2) Some transit operating agencies are actually part of the State DOT, as in Maryland and Rhode Island, for example, and as such receive FTA grants not just through the aforementioned State-directed programs, but also through the Urban Formula Program (49 USC 5307), the Bus and Bus Facilities Program (49 USC 5309), etc. These State transit agencies may seek CE responsibility for all CE projects for which they receive FTA funding, regardless of the FTA program from which those funds come.
(3) When seeking responsibility for highway CEs, some State DOTs, primarily in smaller States and States that do not include any large metropolitan areas, may consider the processing of transit CEs throughout the State as a relatively small and acceptable additional burden. In this case, the State DOT would process transit CEs not just for the State-directed FTA programs, but also for the FTA programs directed to the local transit agencies within the State. The local transit agency would go to the State DOT rather than to FTA for the CE determination, under this scenario.
FTA will ensure that the MOU excludes the delegation of the CE projects of any local transit authority that prefers working with FTA. When a draft MOU is circulated for public comment, FTA will notify all transit grantees within the State whose grant process would be affected by execution of the MOU, so that, if an agency prefers working with FTA, it can so comment, and the draft MOU can be corrected before its execution. FTA expects that, when a State DOT seeks to assume CE responsibility for transit projects for which the State is not the direct grant recipient, that the State will confer with the affected local transit agencies on this issue during the development of the MOU.
The MOU for a State assumption of highway and transit CEs will specify the designated CE projects (both highway and transit) to which it applies and any negotiated thresholds that apply. Then the MOU may further limit the transit CE delegation by specifying which FTA grant programs are included, which, if any, grantees' projects are excluded from the delegation, and any other conditions.
On the Federal side, both the FHWA Division Office and the FTA Regional Office would be signatories to such MOU. On the State side, the MOU may be signed by a single State official whose position within the State DOT is high enough that both highway and transit projects fall under his or her jurisdiction. If one State official lacks that authority, two State officials, one from the State highway administration and one from the State mass transportation administration, must sign.
