Federal Register: May 7, 2001 (Volume 66, Number 88)
DEPARTMENT OF TRANSPORTATION
Federal Highway Administration
[FHWA Docket FHWA-98-4300]
Transportation Equity Act for the 21st Century; Implementation for Participation in the Value Pricing Pilot Program
AGENCY: Federal Highway Administration (FHWA), DOT.
ACTION: Notice; solicitation for participation.
SUMMARY: This notice invites State or local governments or other public authorities to make applications for participation in the Value Pricing Pilot Program (Pilot Program) authorized by section 1012(b) of the Intermodal Surface Transportation Efficiency Act of 1991 (ISTEA) (Public Law 102-240, 105 Stat. 1914), as amended by 1216(a) of the Transportation Equity Act for the 21st Century (TEA-21) (Public Law No. 105-178, 112 Stat. 107 (1998)) and presents guidelines for program applications. This notice updates an October 5, 1998, notice by providing revised procedures, processes and timelines. This document also describes the statutory basis for the Pilot Program and procedures that will be used to implement the program. The FHWA will accept comments on these administrative guidelines throughout the life of the Pilot Program and, as necessary, will issue additional guidance in response to public comments and program experience.
DATES: The solicitation for participation in the Pilot Program will continue to be held open until further notice. To ensure that all projects receive fair consideration, the FHWA encourages all potential grant applicants to submit their proposals no later than October 1, 2001, for fiscal year (FY) 2002 funds and October 1, 2002, for FY 2003 funds.
FOR FURTHER INFORMATION CONTACT: Mr. Patrick DeCorla-Souza, Highway Pricing and System Analysis Team (202) 366-4076; or Mr. Steven Rochlis, Office of the Chief Counsel, (202) 366-1395; FHWA, 400 Seventh Street, SW., Washington, DC 20590. Office hours are from 7:45 a.m. to 4:15 p.m., e.t., Monday through Friday, except Federal holidays.
You may submit or retrieve comments online through the Document Management System (DMS) at: http://dms.dot.gov/submit. Acceptable formats include: MS Word (versions 95 to 97), MS Word for Mac (versions 6 to 8), Rich Text File (RTF), American Standard Code Information Interchange (ASCII)(TXT), Portable Document Format (PDF), and WordPerfect (versions 7 to 8). The DMS is available 24 hours each day, 365 days each year. Electronic submission and retrieval help and guidelines are available under the help section of the web site.
An electronic copy of this document may be downloaded using a modem and suitable communications software from the Government Printing Office's Electronic Bulletin Board Service at (202) 512-1661. Internet users may reach the Federal Register's home page at: http://www.nara.gov/fedreg and the [[Page 23078]] Government Printing Office's database at:http://www.access.gpo.gov/nara
Section 1012(b) of the ISTEA, as amended by section 1216(a) of the TEA-21, authorizes the Secretary of Transportation (the Secretary) to create a Pilot Program by entering into cooperative agreements with up to 15 State or local governments or other public authorities, to establish, maintain, and monitor local value pricing pilot programs. The statute provides that any value pricing project included under these programs may involve the use of tolls on the Interstate system. This is an exception to the general provisions concerning tolls on the Interstate system as contained in 23 U.S.C. 129 and 301. A maximum of $11 million is authorized for each of the fiscal years 2000 through 2003 to be made available to carry out Pilot Program requirements. The Federal share payable under the program is 80 percent of the cost of the project. Funds allocated by the Secretary to a State under this section shall remain available for obligation by the State for a period of three years after the last day of the fiscal year for which funds are authorized. If, on September 30 of any year, the amount of funds made available for the Pilot Program, but not allocated, exceeds $8 million, the excess amount will be apportioned to all States for purposes of the Surface Transportation Program.
Funds available for the Pilot Program can be used to support pre- project study activities and to pay for implementation costs of value pricing projects.
Section 1216(a)(5) of the TEA-21 amends section 1012(b) of the ISTEA by adding subsection (6) which provides that a State may permit vehicles with fewer than two occupants to operate in high occupancy vehicle (HOV) lanes if the vehicles are part of a local value pricing pilot program under this section. This is an exception to the general provision contained in 23 U.S.C. 102, that no fewer than two occupants per vehicle are allowed on HOV lanes. Potential financial effects of value pricing projects on low-income drivers shall be considered and, where such effects are expected to be significant, possible mitigation measures should be identified, such as providing new or expanded transit service as an integral part of the value pricing project. The costs of such mitigation measures can be included as part of the value pricing project implementation cost. The Secretary is required to report to Congress every two years on the effects of local value pricing pilot programs.
The Value Pricing Pilot Program is a continuation of the Congestion Pricing Pilot Program authorized by section 1012(b) of the ISTEA. Under this program, pricing projects have reached the implementation stage in San Diego, California; Lee County, Florida; Houston, Texas; and San Francisco, California. In addition, pre-program planning activities have been completed or are on-going in the following States: Oregon, California, Colorado, Minnesota, Washington, Florida, Maryland, Texas, and New York. Funds were also used to support the California DOT's monitoring and evaluation study of the private, variable-priced toll lanes along State Route 91 in Orange County, California.
Discussion of Comments
The FHWA received three comments to our previous notice published on October 5, 1998, at 63 FR 53487. One was a comment from a private citizen, one from a metropolitan planning organization, and one from a national trade association. Two of the comments were favorable. The third commenter, a national trade association expressed support for the value pricing concept. However, as a matter of policy, the association opposes new or increased peak period tolls on Interstate highways because it does not consider such tolls to be efficient and truckers do not have the same flexibility with regard to their schedules as motorists engaged in personal travel. However, based on the pilot projects to date that have implemented pricing programs on Interstates, tolling has only been implemented on special-use lanes, and has actually improved traffic flow slightly in the regular unrestricted use lanes by shifting some traffic from them to the tolled lanes.
The purpose of this notice is to provide general information about the Pilot Program and the FWHA's plans for implementing the program, and to invite State or local governments or other public authorities to make applications for participation in the Pilot Program.
"Value pricing," "congestion pricing," "peak-period pricing," "variable pricing," or "variable tolling," are all terms used to refer to direct time-of-travel charges for road use, possibly varying by location, time of day, severity of congestion, vehicle occupancy, or type of facility. By shifting some trips to off-peak periods, to mass transit or other higher-occupancy vehicles, or to routes away from congested facilities, or by encouraging consolidation of trips, value pricing charges are intended to promote economic efficiency both generally and within the commercial freight sector. They also reduce congestion, improve air quality, conserve energy, and meet transit productivity goals.
A "value pricing project" means any implementation of value pricing concepts or techniques meeting the definitions contained in this notice and included under a "local value pricing pilot program" under this section, where a local value pricing pilot program includes one or more value pricing projects serving a single geographic area, such as a metropolitan area. "Cooperative agreement" means the agreement signed between the FHWA and a State or local government, or other public authority to implement local value pricing pilot programs under this section (See 49 CFR part 18).
The overall objective of the Pilot Program is to support efforts by State and local governments or other public authorities to establish local value pricing pilot programs, to provide for the monitoring and evaluation of value pricing projects included in such programs, and to report on their effects. While the Pilot Program's primary focus is on value pricing on roads, consideration will also be given to the use of other market-based approaches to congestion relief, such as parking pricing, freight access pricing, electronic payment services linked to value pricing, or pay-as-you-drive services, such as usage based auto insurance, provided the project incorporates significant price variations by time, location, and/or level of congestion.
Potential Project Types
The FHWA is seeking proposals to use value pricing projects to reduce congestion, improve system performance, and promote mobility. Value pricing charges are expected to accomplish this purpose by encouraging the use of alternative times, modes, routes, or trip patterns. To increase the likelihood of generating information on a variety of useful value pricing strategies, proposed projects having as many of the following characteristics as possible will receive highest priority for Federal support. Projects of interest include:
A small amount of Pilot Program funds will be used to assist State and local governments in carrying out pre-project study activities designed to lead to implementation of a value pricing project, including activities such as pre-project planning, public participation, consensus building, modeling, impact assessment, financial planning studies, and work necessary to meet any Federal or State environmental or other planning requirements that assist in establishing value pricing projects and programs. The intent of the pre-project study phase of the Pilot Program is to support efforts to identify and evaluate value pricing project alternatives, and to prepare the necessary groundwork for possible future implementation. Purely academic studies of value pricing (not designed to lead to possible project implementation), or broad, area-wide planning studies which incorporate value pricing as an option, will not be funded under this program. Broad planning studies can be funded with regular Federal-aid highway or transit planning funds. Proposals for pre- project studies will be selected based on the likelihood that they will lead to implementation of pilot tests of value pricing meeting the characteristics described in the previous section.
Funds available for the Pilot Program can be used to support pre- project study activities and to pay for implementation costs of value pricing projects. Costs eligible for reimbursement include costs of planning for, setting up, managing, operating, monitoring, evaluating, and reporting on local value pricing pilot projects. Examples of specific costs eligible for reimbursement include the following:
Project implementation costs can be supported for a period of at least one year, and thereafter until such time that the project generates sufficient revenues to fund its implementation costs without Federal support, except that implementation costs for a pilot project cannot be reimbursed for longer than three years. Each implementation project included in a local value pricing pilot program will be considered separately for this purpose. Funds may not be used to pay for activities conducted prior to approval of Pilot Program participation. Funds may not be used to construct new highway through lanes, bridges, etc., even if those facilities are to be priced, but toll ramps or minor pavement additions needed to facilitate toll collection or enforcement are eligible.
Complementary actions such as construction of HOV lanes, the implementation of traffic control systems or transit projects can be funded through other highway and transit programs eligible under TEA-21 and from new revenues raised as a result of a pilot. Those interested in participating in the Pilot Program are encouraged to explore opportunities for combining funds from these other programs with Pilot Program funds. This is not meant to imply that Federal funds may be used to match Pilot Program funds unless specific statutory authority permits such matching.
Eligible Uses of Revenue
The FHWA will provide up to the legislatively allowable 80 percent share of the estimated costs of an approved project. Any revenues generated by a pilot project must be applied first to pay for pilot project implementation costs. Any project revenues in excess of pilot project implementation expenses may be used for any programs eligible under title 23, U.S. Code. Uses of revenue are encouraged which will support the goals of the value pricing program, particularly uses designed to provide benefits to those traveling in the corridor where the project is being implemented.
Applying for Program Participation
Qualified applicants include local, regional and State government agencies, as well as public tolling authorities. Although project agreements must be with public authorities, a local value pricing program partnership may also include private tolling authorities and non-profit organizations. To streamline the process of applying for program participation as much as possible, it is suggested that, prior to submitting a formal application for program participation, potential applicants contact their State FHWA Division Office and/or the FHWA Highway Pricing and Systems Analysis Team in the Office of Transportation Policy Studies to discuss their interest in the Pilot Program and the general nature of the proposed local value pricing Pilot Program or pre-project study. The FHWA will then be able to provide materials and technical support to assist in the development of the application. Following this initial contact, potential applicants should submit a sketch plan for the proposed pricing program before developing a full-scale proposal. To facilitate a streamlined application process, the sketch plan need not exceed 15 pages. The sketch plan should provide a brief description of the following:
Based on initial review of the sketch plan, the FHWA will work with the proposing authority to develop a refined proposal for review by the Federal Interagency Review Group which provides support to the FHWA in evaluating program applications (see the caption "Review Process," in this preamble below). Ideally, the refined proposal will include:
If some of these items are not available or fully developed at the time the proposal is submitted, proposals will still be considered for support if they meet some of the priority interests of the FHWA as described in this preamble under the caption "Potential Project Types," and include some of the proposal characteristics described in this section, and there is a strong indication that these items will be completed within a short time.
Upon receipt of the detailed proposal, the FHWA's Highway Pricing and Systems Analysis Team will arrange for a review of the proposal by the Federal Interagency Review Group established to assist the FHWA in assessing the likelihood that proposed local value pricing programs will provide valid and useful tests of value pricing concepts. The Review Group is composed of representatives of several concerned offices in the U.S. DOT, including offices in the FHWA, the Federal Transit Administration, the Office of the Secretary of Transportation, and the Office of Intermodalism. The U.S. Environmental Protection Agency and the U.S. Department of Energy are also represented on the Review Group. To facilitate review, applicants should submit an electronic copy of their application, plus an unbound reproducible hard copy of the proposal. As with the sketch plan, detailed proposals should be submitted through the MPO and/or State DOT to the appropriate FHWA Division Administrator, who will forward the plan to the FHWA's Director, Office of Transportation Policy Studies. The FHWA will review applications received and make program participant selections based on the criteria contained in this notice.
To ensure that all projects receive fair consideration, the FHWA encourages all potential grant applicants to submit their proposals no later than October 1, 2001, for FY 2002 funds and October 1, 2002, for FY 2003 funds. This timeline will allow for a fair comparison among proposals received and will also allow the FHWA to make timely recommendations to the Secretary regarding how to expend available funds in accordance with the criteria discussed in this preamble.
Based on the recommendations of the Review Group, the FHWA will identify those Pilot Program proposals which have the greatest potential for promoting the objectives of the Pilot Program, including demonstrating the effects of value pricing on driver behavior, traffic volume, ridesharing, transit ridership, air quality, availability of funds for transportation programs, and other measures of the effects of value pricing. Those Pilot Program candidates will then be invited to enter into negotiations with the FHWA to develop a cooperative agreement to define the scope of work for the value pricing program. The cooperative agreement will be governed by the Federal statutes and regulations cited in the agreement and 49 CFR part 18, Uniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governments, as they relate to the acceptance and use of Federal funds for this program.
Prior to the FHWA approval of pricing project implementation, value pricing programs must be shown to be consistent with Federal metropolitan and statewide planning requirements.
Implementation projects outside metropolitan areas must be included in the approved statewide transportation improvement program and be selected in accordance with the requirements set forth in section 1204(f)(3) of the TEA-21.
Implementation projects in metropolitan areas must be: (a) Included in, or consistent with, the approved metropolitan transportation plan (if the area is in nonattainment for a transportation related pollutant, the metropolitan plan must be in conformance with the State air quality implementation plan); (b) included in the approved metropolitan and statewide transportation improvement programs (if the metropolitan area is in a nonattainment area for a transportation related pollutant, the metropolitan transportation improvement program must be in conformance with the State air quality implementation plan); (c) selected in accordance with the requirements in Public Law No. 105- 178, section 1203(h)(5) or (i)(2); and (d) consistent with any existing congestion management system in transportation management areas, developed pursuant to 23 U.S.C. 134(i)(3).
Authority: 23 U.S.C. 315; sec. 1216(a), Pub. L. 105-178, 112 Stat. 107; 49 CFR 1.48
Issued on: April 27, 2001.
Vincent F. Schimmoller,
Deputy Executive Director.
[FR Doc. 01-11403 Filed 5-4-01; 8:45 am]
BILLING CODE 4910-22-P
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