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Transportation Plan and Program Fiscal Constraint Review Questions

March 8, 2005

The following questions are key considerations in determining whether the requirements of the FHWA/FTA transportation planning regulations have been met regarding fiscal constraint. Overall, the planning process must demonstrate that the relationship among key planning agencies (State DOTs, MPOs and transit operators) has publicly demonstrated an open and collaborative effort that affords the public a clear understanding of the balance between revenues and proposed expenditures. Documentation of the process, assumptions, and the relationship between revenues and costs should be addressed in transportation plans and programs.

Note: The term "reasonable" can be defined in various ways. For purposes of reviewing financial plans, "reasonable" forecasts, estimates, or assumptions can be evaluated against historical trends and experiences or averages of recent and current funding levels and rates (e.g., inflation, growth, etc.). Forecasts may also consider present political conditions such as the reasonable expectation that a funding bond or new revenue source will be approved.

General Issues (apply to financial plans for MPO long-range transportation plans, TIPs, and STIPs):

  1. Does the document contain a financial plan summarizing current and future revenues and costs?
  2. Are the current and future Federal funds included in the financial plan based on known or reasonably expected authorization levels?
  3. Are anticipated discretionary funds consistent with recent levels of discretionary funds actually allocated to the pertinent agencies/jurisdictions?
  4. Is/Are the financial plan(s) for the TIP(s) consistent with those of the STIP? With the pertinent MPO long-range transportation plan?
  5. Is the financial plan presented and explained in a format that can be clearly understood?
  6. Is the financial plan made available to the public as part of the public involvement process?
  7. Has the financial information in the financial plan been coordinated with all of the affected agencies (MPO(s), State DOT, and transit agencies)?
  8. Was there a cooperative process among the State DOTs, MPOs and transit operators for developing the revenue forecasts?
  9. Does the financial plan demonstrate sufficient funding to maintain and operate the existing transit and highway systems, including rehabilitation and replacement needs, over the entire time horizon of the STIP, TIP, or MPO long-range transportation plan?
  10. Are all the revenue figures over consistent timeframes/fiscal years (i.e., Federal fiscal year ends September 30, while State fiscal year ends June 30)?
  11. Are innovative and new funding sources and projected funding increases reasonably expected to be available (Does past history support the reasonableness of future projections)?
  12. Are future revenues and costs consistently adjusted for a reasonable rate of inflation? Is the method for determining the rate of inflation reasonable?
  13. When MPO long-range transportation plans, STIPs, and/or TIPs are amended, is fiscal constraint reaffirmed and documented as part of the amendment?
  14. When new transportation plans and programs are developed, are the costs and revenues forecasted in the preceding documents reviewed against actual conditions to improve revenue and cost forecasting methods?

Metropolitan Long-Range Transportation Plans:

Revenues:

  1. Does the transportation planning process clearly demonstrate a collaborative development of Federal and non-Federal revenue estimates among State DOTs, MPOs and transit operators?
  2. Is the process used for identifying current revenues and forecasting future revenues adequately and accurately documented including all assumptions?
  3. Are estimates of Federal funds clearly based on established authorizations and reasonable expectations of future Federal funding?
  4. Do the long-range transportation plans contain financial plans (per 23 CFR 450.322(b) and 49 CFR 5303(f)) that adequately reflect funds from FHWA, FTA, other Federal sources, local sources, State assistance, and private participation for:
    • Highway capital investments;
    • Transit capital investments;
    • Highway operations and maintenance investments; and
    • Transit operations and maintenance investments?
  5. Are categories of funding addressed and explained in relation to proposed expenditures?
  6. Are agreements or strategies for obtaining new or innovative funding sources documented and reasonable?
    • If these funding sources are not implemented, is there an identified strategy on how the metropolitan area or State will handle the funding shortfalls?

Costs:

  1. Are the costs to adequately maintain and operate (including rehabilitation and replacement costs) the existing and future highway and transit system included?
  2. Are cost estimates for projects and programs based on an established and consistent process throughout the long-range transportation plan?
  3. Are procedures in place for routinely updating cost estimates and accounting for unanticipated cost increases through the use of contingencies?
  4. In air quality nonattainment and maintenance areas, are Transportation Control Measures (TCMs) clearly identified and given priority for funding?
  5. Are major (i.e., "mega") projects, including FTA New Starts projects, identified with appropriate financial plan requirements satisfied?

Statewide and Metropolitan Transportation Improvement Programs (STIPs/TIPs):

Revenues:

  1. Does the STIP/TIP contain project and financial information (per 23 CFR 450.216(a), 23 CFR 450.324(e) and 49 CFR 5304) that reflects:
    • Highway capital investments;
    • Transit capital investments;
    • Rehabilitation and replacement of highway and transit infrastructure and equipment;
    • Highway operations and maintenance investments; and
    • Transit operations and maintenance investments?
  2. Does the STIP/TIP financial plan contain revenues that are reasonably expected to be available?
    • Is the appropriate documentation for the proposed revenue included in the STIP/TIP or otherwise readily available?
  3. Is the STIP/TIP fiscal constraint demonstrated by year, and by funding source?
  4. Are projects, which are to be implemented by current revenues and those to be implemented using proposed revenues, clearly identified, distinguished, and described?
  5. Are strategies for ensuring the availability of new funding sources identified and reasonably expected to succeed?
  6. In air quality nonattainment and maintenance areas, do the first two years of the STIP/TIP contain only projects with funding available and committed?
  7. Is "over-programming" of Federal funds limited to the total amount of Federal apportionments the State/MPOs are expected to receive over the three-year (minimum) term of the STIP/TIPs?
  8. Do the STIP and TIP financial plans demonstrate that the transportation system is being adequately operated and maintained, including rehabilitation and replacement costs for the existing infrastructure?

Costs:

  1. Are cost estimates for projects based on an acceptable methodology that is used consistently?
  2. Are cost estimates for local projects done by the State DOT or by local organizations?
    • Do MPOs have a role in developing/accepting cost estimates for a TIP from project sponsors?
  3. Are Advanced Construction projects identified in the STIP/TIP, with associated budget information?
  4. In air quality nonattainment/maintenance areas, are TCMs clearly identified and given priority for funding?
  5. Are major (i.e.,"mega") projects, including FTA New Starts projects, identified with appropriate financial plan requirements satisfied?
Updated: 02/12/2013
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