Jennifer Symoun
Good afternoon or good morning to those of you to the West. Welcome to today's special Talking Freight Seminar on TIGER II Discretionary Grants and TIGER II TIFIA Payments. My name is Jennifer Symoun and I will moderate today's seminar. Please be advised that today's seminar is being recorded.
Before I go any further, I do want to let those of you who are calling into the teleconference for the audio know that you need to mute your computer speakers or else you will be hearing your audio over the computer as well.
Today we'll have several presenters and others joining to answer questions:
I'd now like to go over a few logistical details prior to starting the seminar. Today's seminar will last 90 minutes, with 60 minutes allocated for the speakers, and the final 30 minutes for audience Question and Answer. If during the presentations you think of a question, you can type it into the chat area. Please make sure you send your question to "Everyone" and indicate which presenter your question is for. Presenters will be unable to answer your questions during their presentations, but I will start off the question and answer session with the questions typed into the chat box. Once we get through all of the questions that have been typed in, the Operator will give you instructions on how to ask a question over the phone. If you think of a question after the seminar, you can send it to the presenters directly, or I encourage you to use the Freight Planning LISTSERV. If you have not already joined the LISTSERV, the web address at which you can register is provided on the slide on your screen.
Finally, I would like to remind you that this session is being recorded. A file containing the audio and the visual portion of this seminar, as well as the presentation from today, will be posted to the Talking Freight Web site within the next week. We encourage you to direct others in your office that may have not been able to attend this seminar to access the recorded seminar.
We're now going to go ahead and get started. Today's topic, for those of you who just joined us, is TIGER II Discretionary Grants and TIGER II TIFIA Payments.
As a reminder, if you have questions during the presentation please type them into the chat box and they will be answered following the presentation.
Today's topic is TIGER II Discretionary Grant and TIGER II TIFIA Payments. I will turn it over to Jacob Falk.
Jacob Falk
Thank you very much. Thank you all for participating in this webinar on the TIGER II Discretionary Grant Program. We will start with overviews, background, move into specifics and as we get through the presentation we will finish up with some qualities, strategies of competitive applications, sort of tips and guidance to make an application strong.
The first slide is the program overview. The original TIGER program, TIGER I, was a Recovery Act Program so included certain requirements. This program, TIGER II, is $600 million dollar program provided through the fiscal year 2010 Appropriations Act. It's no longer technically a Recovery Act program, but the program is very similar to the original TIGER program. The underlying principle is looking for projects that have a significant impact on the nation, metropolitan area or region, and this is the same in TIGER II as in TIGER I. As in TIGER I, there is the opportunity for capital grants for surface transportation projects, but we do also have funding for TIFIA and something different from the first one, we have funding for planning grants. Another item which is similar to the first round that is in choosing projects, we are looking not only for significant impact, but we are also required to have equitable geographic distribution, balance the needs of urban and rural areas. We have a requirement to invest in a variety of transportation modes.
The next slide is the Federal Register notice. We published an interim notice, and because this is a new program we asked for comments over a two-week period. We got back comments, the Final Notice of funding availability was available in the Federal Register this past Friday, and is now published in hard copy in today's Federal Register. This is the operative notice of funding availability, what should be looked at. It's very similar in many respects to the TIGER I Final Notice. We made a handful of changes from the interim notice published in April to the Final Notice, but the Final Notice does have some changes. You should definitely take a look, see what those changes are. I will talk about a few of them throughout the presentation
Beth Osborne
I will address the planning side. We put in the interim notice, and stated in comments on the possibility of collaborating with HUD and their community challenge planning grants. Those planning grants were meant for local planning efforts like station area planning, TOD, setting up land banking programs or updating program codes, zoning codes. Obviously things that go along side of transportation projects, when done right can enhance a project's chance for success. We are continuing to review the comments we received and are working with HUD on the potential of doing a joint notice of funding availability and we anticipate having something in the Federal Register in the next week or two.
Jacob Falk
Moving along, the one thing that hasn't changed from TIGER I to TIGER II is eligibility requirements. Both in terms of eligible applicants, which remain state and local governments, transit agencies, the port authorities, MPOs, other political subdivisions and include groups of jurisdictions that may wish to apply together. Private entities are not eligible to be an applicant directly, but private entities can partner with the public sector entities and can apply in partnership with private entities for private projects.
In terms of eligible projects, two keys. One, we're looking at capital investments, and it should be in surface transportation infrastructure which generally includes roads, highways, bridges, public transportation project, both passenger and freight rail, port investments, and intermodal projects that fit within that framework are also eligible. One thing to note, you may have a project that has transportation components tied in with other components. They can be housing or other development components that, for purposes TIGER, the transportation components are eligible but all components outside of transportation are not eligible.
In terms of award amounts, this slide really goes through criteria set forth in the Appropriations Act for how much grant funds we can give for particular projects. It should generally be between $10 million at the low end and $200 million at the top, the amounts requested and awarded. In the first round, in TIGER I we didn't have a requirement for applicants to provide matching funds. This time around this is a requirement to provide 20% or more of the project cost for a match. So we can no longer fund 100% of a project. That's outside of a rural area. This time around we do have a $140 million amount reserved for projects located in rural areas. In rural areas we're able to fund 100% of project cost and minimum grant size drops down to a $1 million. The rules are a little different for rural areas. We had a requirement as last time where a percentage of funds can go to funds in any one state. This time we have a similar requirement and it's 25% of funds maximum to any one state or $150 million. Last time it was $300 million to any one state, but we did not meet that maximum in any state around the country.
Here again we have up to $150 million available to be used to support TIFIA financing to pay for the financing and administrative costs. Last time was $200 million. As discussed, this time around we have up to $35 million available for planning grants.
The selection criteria we are using to evaluate projects, in which we expect projects to align with in submitting applications, is very similar to the selection criteria included in the first round of TIGER. There are two primary and then two secondary selection criteria. The primary selection criteria start with long-term outcomes. These are the five key long-term outcomes we are looking for. They align with the Secretary's priorities and these are ones that have not changed from the first round to the second. The first priority is that the project has to be in a state of good repair. This goes to the condition of the project, and we want projects improving the condition. The next is economic competitiveness. This one is really thinking about the medium to long-term competitiveness of the U.S., boosting productivity. The third one is livability, which is focusing on the quality of communities for people who are living and working there, how infrastructure relates, can improve the quality of those communities. The fourth is environmental sustainability, improving energy efficiency, reducing dependence on oil, reducing greenhouse gas emissions. The final is safety, improving safety of U.S. transportation facilities. These are the primary, key long-term outcomes we are looking for and selection criteria. You have to make sure your project hits these criteria well. Your project doesn't have to align well with all of these, but should with one or more of them. In order to advance an evaluation process you need to demonstrate your project aligns well with at least one, preferably very well with one or multiple of these long-term outcomes.
The next of the primary selection is job creation and economic stimulus. We are no longer under the Recovery Act, it's the 2010 Appropriations Act, but we are still including job creation and economic stimulus as primary selection criteria, given where the current economy is. This is still an important aspect of your project on how quickly you can get started, create jobs, and stimulate rapid increases in economic activity, still an important aspect of these applications. The next of these selection criteria, and we call these secondary, are given less weight in the evaluation process The two secondary selection criteria are innovation and partnership. Innovation really refers to whether or not you have innovative strategies incorporated in the project to help you achieve the long-term outcomes. Partnership goes to two things. One is collaboration amongst a variety of partners in the project. That could be state, federal, local, a variety of public and private entities who can be participating in planning, delivery of the project, and also contributing financial resources to the project. The second part of partnership is integration, transportation priorities with other public service efforts. If there's other public entities which are interested in the project for other reasons, pursuing other outcomes and the project integrates transportation goals with those other goals, that's certainly a positive aspect of an application.
I will turn it over to Darren Timothy who will talk about benefit cost analysis. Benefit cost analysis not one of the selection criteria, but an important component of any application.
Darren Timothy
As in the first TIGER program, we are requesting that our applications provide a benefits cost analysis. This also includes a statement that the Department will not provide funding if the project does not have predicted benefits that exceed the cost of the project. There is, in the notice of funding availability a more detailed guidance on doing these analyses, and the bullet points here are some of the topics covered. Roughly one-third of the Final Notice including Appendix A goes through guidance on doing the benefits cost analysis. All of the benefit cost analysis are reviewed by a team of economists from different modes and assigned ratings based on the quality of the analysis, how useful the analysis is in helping determine whether the project's benefit exceed cost or not. There's an important discussion there about the importance of the benefit cost analysis and economic impact analysis, useful approaches, useful information. We want to focus on those elements that would be included, not those in economic impact analysis.
The guidance discusses the importance of having a useful baseline and project alternatives, such things as identifying for large project, making sure to include analysis of lesser alternatives, rather than just a versus an all or nothing case. The application discounting is always an important part of any forward-looking analysis.
It is important to provide information about the forecasting methods used and recognizing that projects are expected to evolve over time, not appropriate to simply use an end year analysis, and apply those benefits to the entire analysis period. We are asking our project sponsors to quantify benefits in each of the five long-term outcome categories. What's important there is not so much which category the benefit is in, but that it's counted once and only once.
In TIGER I we had different tiers of what type of analysis was expected on the part of applications with a benefit cost analysis for large projects, considered lesser analysis. This time around we are not making that type of distinction. All projects are being asked to provide an analysis with the understanding that as smaller projects are expected to have less of a detailed analysis and perhaps more qualitative discussion as opposed to quantitative.
It's important to make sure the cost of the project match the project benefits and providing with transparency and reproducibility as much as possible. This is an exhortation to show us your work. It's very helpful. The more you show us, the better, since we have a better opportunity to make the determination.
Jacob Falk
So in the next few slides we talk about the pre-application and application process. This is different from the first round of TIGER where we only collected applications, did not receive pre-applications. This time we are asking for a pre-application, the due date for the pre-application is July 16, 2010. The pre-application is not to engage in an iterative process with each applicant, it's more from our perspective of getting a sense of the universe of applications that will be coming in so we can prepare for the evaluation process, and also there are a few aspects of the pre-application we are interested in. We want to make sure projects are eligible and we have eligible applicants. We want to make sure the projects have lined up the 20% match required for projects not located in rural areas. We want to make sure projects have capital and are substantially complete with the NEPA process, going to project readiness. This is an area where we have made a few changes in the Final Notice of funding availability from the interim notice of funding availability with respect to what we expect to the see from different applicants on NEPA. Generally speaking, we like to see applications that can say NEPA is complete; we realize not all will be able to say that. In some cases, we are okay with NEPA being substantially complete and have reasonable confidence there's a timeline that works, that can get us to a completion of NEPA. This is important because we do have statutory obligation date. We have to obligate all funds by September 30, 2012, and we need to know NEPA will be complete well in advance of that. We recognize some projects which have not previously anticipated federal funds and don't have any other traditional federal programs they can turn to for funds, so it was never in the picture to do NEPA. In those cases we still expect the projects to have done analysis of environmental impacts, to have thought about that, although we do not expect the projects to be substantially complete given the type of funding available outside of the TIGER program.
The application is due on August 23, 2010. This is similar to the applications under TIGER I, 25-page limit. This time around in the notice of funding availability we did provide more of an outline, and we strongly suggest applications follow that outline. It's a good way to get across the key items of information that are needed for us to evaluate the project. That outline is included in the Final Notice. We would encourage applicants to take a look at it. There are certain items, like the benefit cost analysis which in some cases could easily get to be longer than 25 pages. In that case we would like the summary, highlights of the benefits cost analysis or for example the NEPA documentation to be included in the 25-page narrative, and the robust benefit cost analysis or link to the NEPA documentation these types of things would not be counted towards the 25-page limit. With that, we will jump to TIGER II TIFIA payments and Duane Callender will talk about that.
Duane Callender
Similar to TIGER I, $150 million was made available for subsidy costs and administrative expenses to TIFIA. TIFIA is currently over-subscribed outside of the regular process this is one of the only avenues to get TIFIA funding for loan guarantees. Any money from the $150 million will be used to cover the costs that available. The DOT may offer grant applicants a TIFIA payment even if they haven't applied for it similar to the TIGER TIFIA Challenge Grant which was similar to the first go around. The current process was to have applicants submitting a TIGER II Discretionary Grant application, at the same time TIFIA letter of interest so that the first time around we had applications come in at that point but because the projects have to go through TIGER process, it doesn't make sense to use all the resources to create the application if they are not going to be successful for TIGER. If the applicant is selected, the applicant must comply with all of TIFIA program's standard application and approval requirements, including a $50,000 application fee. Applicants may apply for both Grant and TIFIA on the same project. There is no prohibition or discouragement of that at this point.
Jacob Falk
The next piece of this is actual evaluation process. When we get all these in we have multi-modal teams of technical, professional staff from throughout the department who review these applications, including representatives from the Federal Highway Administration, Maritime Administration, Federal Railroad Administration, Federal Transit Administration and members of the Office of the Secretary. They evaluate the applications and give them ratings for the selection criteria. The ratings are: highly recommended, recommended, not recommended, or negative. That is really how well the project aligns with the selection criteria and is what determines whether or not the applications will be advanced to a senior level review team. We have an economic analysis team that contributes to the benefit cost analyses provided and an environmental team that looks at the project readiness and NEPA and helps figure out how ready the projects are to move forward quickly. That leads to selection of the projects, and project administration and reporting. This is what we are moving through in the first round of TIGER.
Next slide, we are covering for each of the projects selected, we have one of those four relevant Modal Administrations which administer the grant and enters into a grant agreement with the recipient and relevant Modal Administration, and we expect the process for TIGER II will be similar. It's important to note we do have a requirement to obligate all funds by September 30, 2012. We are going to be looking to announce the project awards and enter into grant agreements as quickly as possible so that we can be sure to hit this date for obligating all of the funds.
The next component of this presentation is strategies for competitive applications. We did have a week or two ago, a seminar here in Washington D.C. which was also broadcast on the web, we went through the key elements based on collective experience in the Department for TIGER I. We wanted to highlight the competitive aspects we think are very useful, important for applicants to know. We are going to run through these now and I will turn it over to Deputy Assistant Secretary Beth Osborne to get us started on that.
Beth Osborne
The first item on the list is eligibility. Eligibility requirements that are in statute and listed, but I will gloss over them again. Must be capital investment in surface transportation project and must be one of independently utility. Applicant must be government entity, there is a statutory minimum of $10 million per project, and however it's a lower minimum for rural projects of $1 million and maximum of $200 million per application and $150 million per single state.
The point we really want to make here is eligibility is not the same thing as being competitive. You can meet the minimum eligibility requirements and not have a competitive application. This is something that is different than other transportation programs which tend to be formula based and you look at meeting statutory criteria and have great flexibility. In this program, because it is so over-subscribed, we have the opportunity to choose from applications from go well beyond basic eligibility, and therefore you should think more than just meeting minimum eligibility, but in terms of being highly competitive.
The second area is the criteria. A lot of folks have come in and asked us about how we evaluate these projects. The overwhelming focus of our evaluation is on the long-term criteria; the five elements that Jake laid out, economic competitiveness, livability, environmental sustainability, and safety. The safety one is the one with the least confusion. It's an area that within transportation, we quantified for years and therefore it's something people were very comfortable with. In the other areas, I would like to get into a little more detail of each of them. One is economic competitiveness. Within economic competitiveness there are two things to be conscious of. One is, when we are looking at creating greater economic competitiveness and economic activity, we are looking at an overall increase to the country; in other words we are not looking at a program that will move jobs from one state to another. You may, for example, have a port improvement project that will result in increased freight movement through that port and through your area however, it's clear that tell it will move it from a neighboring port. That is not overall increase in jobs, just movement within the country, and we are focusing on projects that increase overall economic activity and increase jobs.
The other thing with economic competitiveness, while we are looking at the region, a more competitive application will consider not just the regional economic health, but what happens to the community touched by the project. Sometimes there will be winners and losers with transportation projects where the neighborhood touched is harmed, although the region is helped. In a highly competitive program like this we can choose those that are very sensitive, therefore there are no losers to the project. It is contact sensitive and thinking about the community it's touching while helping the overall. In terms of state of good repair, sometimes you see applications in communities that might make a choice, for example, to do things that cause a transportation project to degrade faster than it would otherwise, maybe by permitting heavier trucks to run over that roadway and getting the economic benefit of having those heavier trucks, but that will not be as competitive an application saying you did something voluntarily on a road way, now trying to fix it, as a community trying to get their system up to a state of good repair. So be conscious of those sorts of issues as well.
In terms of livability, four things we are looking at. One is transportation options. Two is particular transportation options for non-motorized communities such as seniors, disabled, and those low-income members of the community. Three is intermodal connectedness, and four is coordinating transportation and land use decisions. We have some very specific things we are looking at in terms of livability, and what we mean. I would focus in on those. Five is environmental sustainability, a broad area, reduction of greenhouse gas emissions, reduction of storm water run-off and pollution caused by that. Environmental sustainability, this is the long-term criteria, something like bottleneck relief which is medium or short-term will not rate as well as one with a long-term horizon, reducing greenhouse gas over a 100-year time frame as opposed to 10 or 20 year time frame. Please be very careful in your focus on that. That is the crux of the application. If you are not performing well there we are not going to look beyond that. You don't have to do well in all the criteria. If you look through the TIGER grantees in the first round, you will notice some performed well in a certain area. For example, in New Mexico US-491 performed well in the highway safety as it was a roadway with three times the average fatalities of the state. This one project will result in bringing it below the state average. There are other projects like in Milwaukee, the bridges project focused on state of good repair. The Crescent corridor is an economic competitiveness and sustainability project. The New Orleans streetcar is primarily about livability. You can look through those projects and see that we were not looking for something that performed fabulously on all five. We are really looking for those that really stood out in one or two or maybe three.
The third category is clarity of application and project descriptions. This goes back to what we were talking about, this program being oversubscribed. We had 1400 applications worth over $60 billion for $1.5 billion in funding availability. Therefore, this application process is very much like you would expect an application to the most highly competitive colleges in the country. In helping your kids prepare the college applications or remembering yourself, you are looking to really stand out in an area where the folks reviewing it are reviewing fantastic amounts of applications, and have their pick. Therefore, the clarity of your application is paramount. You may have all the information in there, but if it's hard to read, hard to find, it's as if it does not exist. Think about a reviewer reading 150 applications in a two-week period of time or maybe three or four weeks. It's an exorbitant amount of reading. To the extent you can stick with the proposed outline of applications, so they are looking at a similar flow, you are writing something very clear in terms of project description and what the federal dollars will be used for, so it is obvious from the very beginning of the application. Sometimes it was extremely difficult to figure that out. Something that could be read by your neighbor that never worked in transportation and could still understand what you goal is. That will be much more likely to do well just because the people with the overwhelming load will with a better sense of what they are dealing with.
Jacob Falk
The next strategy here is the size of grant request. I want to preface by saying we don't have a particular size of grant request we think is the "right" size for the request, but having said that, in the last round of applications the average grant size, projects were allowed to be up to $300 million and the average grand size was closer to $30 million. We had a few projects in the $100 million range. Those were often multi-state, multijurisdictional projects where there were a number of partners receiving funds.
The reason we want to talk about this is because we have in TIGER II, similar to TIGER I, requirement to balance on the one hand our desire to really do some major projects, nationally significant type projects that are very expensive and we have to put a lot of money into them, with our desire to fund projects to provide equitable geographic distribution, important for local areas, regions, metropolitan areas. This is a statutory requirement for us to take into account being the, equitable geographic distribution, balancing the need of rural and urban area and the different modes we have. We have only $600 million this time, significantly less than the first round. One way to think about this is to imagine if we were to split the country up to four regions and fund two projects in each region, which is not a lot, considering the size of those regions; we would already be in eight projects, down to $70 million per project. If there were four we would be down to an average of about $35 million per project. The reason we mention this is we want you to be very aware of the balancing required and constraints we are under in terms of funding projects looking for the full $200 million available for each project. Keep that in mind when thinking about the projects you are going to submit. Also keep that in mind when thinking about this next bullet point, leverages investment. This goes back to the requirement to give priority to projects using TIGER funds to complete an overall financing package. Looking for projects have state, local, private sector funds in the project as well. We did, I want to make sure to note, in the notice of funding availability we clarified what we mean by local match, which will get you to the 20% requirement. We can only fund up to 80% of the project. We further defined what that 20% has to be. I encourage to you look at that in the note, but basically outside of federal funds any state, local or other public funds combined with private sector funds can all be used for the 20% matching requirement. One other thing we note is we are looking for funds that will be expended, not for people to include funds which have been expended previously in the past.
A critical point here, this is a super competitive program, there's a difference between eligibility what you have to put into the project in terms of 20%, and making a project as competitive as you might be able to. The more you can put into the project in terms of state, local, or private sector funds, whatever funds you can put in, the better. This gets to the heart of what we think are the big benefits of a competitive grant program. We have the opportunity to reward people who can get a lot of partners on board, go through a well coordinated, structured planning and delivery process where they are able to draw on a number of different resources. Our experience is we have gotten a lot of really good applications from this competitive grant program and other programs in terms of what we can encourage people to bring together in the application. So think about competitiveness in that section.
Beth Osborne
I would add one thing to what Jake said; while rural areas are not held to the 20% match requirement, in the first round of TIGER we found many rural areas were able to leverage a great deal of investment. I would not necessarily look again at the eligibility requirements in term of being competitive. We found struggling communities willing to put up a large amount of money to support a high-priority projects, and communities that were not struggling very much not willing to put up money, so in terms of a competitive application, if you are asking how you can get into the minimum eligible match you are probably not creating the most competitive application possible.
Jacob Falk
The next bullet point, something we call project segmentation, there's really two things I want to cover here. One is the point Beth mentioned about independent utility. We can only fund projects that have independent utility. What we mean by that, a term used in other contexts as well, including NEPA, but for purposes of evaluating applications, what we mean is that one, the project will provide transportation benefits when complete. Those benefits should be the benefits described when talking about the long-term outcomes and the other criteria we are looking for. Two, that the project when complete will be an operable segment that can be used. We are looking for projects when all the TIGER funds are spent, absent additional investment the project is ready to go and will provide benefits.
So, for example, if you have a project you split in multiple phases and you are looking for TIGER to help you finish phase 1, we would want to see phase 1 as a complete transportation project, even if there are other phases coming to enhance or improve the project or fill it out. We need this project we are building to be a complete project when all the funds have been expended. If the project is in a situation where you will complete phase 1 and have to find additional funds to finish Phase 2 before the project can be used, in that situation the project would not have independent utility and we want not want to commit federal funds to half a project with the expectation or promise or thought more funding be committed at a later stage to finish the operable segment.
The other thing worth noting goes back to clarity. If you have a project with multiple components of independent utility, it's important your application reflect the different components, why each has independent utility, the components of those and what the benefits are. This is especially useful if we would get an application for the maximum amount of funds and we like aspects of the application; other aspects may not be as compelling. It's in your benefit to provide a very convincing case to the people reviewing the application they can get a lot of the benefits from the project if they choose one component of the project, not all of the project as a whole. As you put together applications, think about providing in a very clear way where those projects can be segmented, what the different packages and projects are. It may be it is one project and you need to do the whole thing. That's fine as well. But to the extent you are able to segment, that's worthwhile and helpful for the people reviewing the application.
Darren Timothy
On benefit cost analysis, the key thing to take away is the analysis is complementary to the description, the narrative that addresses the long-term outcomes and other evaluation criteria. Every time I have seen a good benefit cost analysis, the project sponsor thought carefully about the project, understands what they are trying to achieve, gone through to document that. Conversely, projects that are fuzzier come up with lower-quality analyses. Also important to have the analyses be commence commensurate with the focus of the project. A project which is expected to have primary safety benefits is expected to have more careful detailed analyses of safety benefits than a project where safety is more ancillary outcome for that specific project. So going through the analysis and following the guidance we have will also get you much further to where you want to be.
Beth Osborne
I would like to add two things to that. One is that DOT will not rank a project based on its benefit cost analysis. This is supportive information; this is the data backing up the long-term criteria, but is not going to be the basis for a ranking. The second is that I have heard a lot of concerns from community that's don't necessarily have a larger department or capacity that this could be difficult in terms of paying some outsider, consultant to do your benefit cost analysis. In terms of the first round of TIGER, we saw very impressive cost analysis done by smaller organization and in-house. It is not something we want folks to believe they have to go out, spend a lot of money to accomplish. It's just something that requires you to develop and document the data to support the claims you are making in terms of your long-term criteria.
Darren Timothy
The raw material for a benefit cost analysis ought to be contained in the planning documents in developing the project. It's just finding and presenting that information that's important.
Jacob Falk
The next point is something we have touched on earlier, project readiness and NEPA. I think the one key here is that this is no longer Recovery Act program. Some of the Recovery Act deadlines don't apply. We no longer have to give priority to projects that can be completed within three years, something we had to consider in the first round. However, we still have the primary selection criteria that the project can create jobs quickly, and also have the requirement that we obligate all of the funds by September 30, 2012, not that far off. We are paying very much attention to project readiness. We have six elements outline in the Notice of Funding which include any necessary legislative approval, environmental approval, financial feasibility, and technical feasibility. It's important that you in your application give the Department the sense and the comfort that the project can get started quickly and will obligate all funds September 30, 2012. As mentioned earlier, we have provided guidance in terms of NEPA in the Final Notice, I encourage you to like at that as mentioned earlier.
Beth Osborne
In terms of projects that stand out, I will talk about some that really shone in the first round, but those that typically did not perform really well, and before I get into this, not to say any projects were, the ones that stood out are necessarily the best investment of dollars, it's just in this competitive process they rose to the top for various reasons.
One thing that tended to rise to the top were non-traditional projects or came with the long-term outcomes, but wouldn't have anyplace else to go for federal dollars. You will notice some of those in the first round of funding like the Crescent Corridor, some of the port projects, things like that.
Also, projects that created new partnerships, multi-state, public/private, things very difficult to organize, and also tend to be difficult to fund through our current program which is focused on state by state. Some examples of that would include the Woodward Avenue Rail in terms of the public private or National Gateway. In terms of breaking down government silos, both internal at DOT and between DOT and other federal agencies and state and local agencies really rose to the top. One example is the Portland Innovation Quadrant we struggled to even define. It had a roadway component, streetcar component, a bike-pedestrian component. It was a really interesting project because you couldn't even type it as one particular mode.
Another area is one that supports other key national priorities. For example, a project that supports the manufacturing and movement of wind energy components, and other non-transportation, but still national key priority, and the last part is strong local state or private funding support. Now, in terms of projects that did not tend to compete as well, again I am not saying we don't value these projects. We are saying in terms of an overly subscribed very competitive program these did not do as well as other types of investments did. Examples are roadway resurfacing projects, parking lots, research without deployment, not just talking about a demonstration program, but true widespread deployment. Cruise ship terminals, museum improvements, and as mentioned earlier economic development projects that displace economic development in other areas.
Jacob Falk
I think the last piece of this, the timeline of where we are. We published the criteria on April 26, 2010. The Federal Register today includes the Final Notice, available on Friday's Federal Register for public inspection. The pre-applications must be submitted by July 16 this summer, and the applications must be submitted by August 23, 2010. We have a statutory requirement we announce projects selected no earlier than November 15, 2010. Our goal, effort is to try to announce as soon therefore as we can. We don't have a definite date for when we will announce awards, but are hoping as soon as we can, considering the number of application that's come in; which as mentioned earlier, in the last round, TIGER I, over 1400 applications, so it will take us a couple of days to get through the applications.
Jennifer Symoun
We are now going to move on to the Question and Answer session. I know we have a number of questions, we will just start from the stop, go through them. If we still have time we will move to the phone lines. Please continue to type in your questions as we go.
A quick question: is there a way to get a copy of the presentation. The presentations and a recording will be posted online in the next few weeks. We will probably wait until after the June 15 TIGER II planning seminar. I will send out an e-mail to everybody once they are available.
The next question is: what funding category would actual transit related capital improvements that support DOT housing development be eligible for? Would, for example, any of these qualify as pre-development costs under either of the planning grant categories? Or, could a single application include a number of TOD projects with these improvements to be funded which in aggregate meet or exceed the $10 million minimum of the TIGER II discretionary grants?
Beth Osborne
As Jake mentioned earlier, if there are transportation components to that, they would be eligible for the TIGER II Discretionary Grant Program. I would also suggest that you watch closely the Federal Register. If we are able to go forward with a process of joint funding availability between our up to $35 million in Transportation Planning Grants and HUD's Community Challenge Planning Grants, you will notice that HUD's program would fund a good portion of these sorts of projects, including site preparation, land banking, housing development and zoning code changes to support housing development. The other part of the question was can you aggregate several TOD projects to exceed the $10 million, if they are part of the corridor, absolutely.
J. Symoun
The next question is can we get information on the grant review for our previous TIGER application?
B. Osborne
The answer is yes. We have provided information to those who requested a meeting, and sat down, explained to folks the process, how it impacted their grant application.
Jacob Falk
On that question I would note that it would be tough if we would immediately open up to 1,400 plus applicants at once and start giving detailed information. First we would give our broad general seminar. We kind of covered a lot of the key points which would be talked about. We aren't going into details of particular scores, but are talking about sort of a lot of the key elements which are very similar to what we are talking about today in terms of project readiness, etc.
J. Symoun
The next question is can a state apply for an element of a project implemented only if TIGER II funds are received.
J. Falk
The answer to that is yes. That's something good to highlight in the application. To the extent you have a project which a percentage is funded, or committed funds, or already have work underway, if you can show how TIGER II funds would be used to finish, to complete that financing or funding package, that is good, especially if there's a bunch of other sources of funds and partnership in there getting the project moving.
J. Symoun
Next question, what is the definition of a rural area?
J. Falk
This is also something that more clarification is provided in Final Notice which is in today's Federal Register. We are working from the Census Bureau's definition of urbanized area. The Census Bureau defines it is defined as an area with over 50,000 people. We are considering areas outside of an urbanized area to be a rural area for purposes of this program. One thing we provided clarification on in the notice is, we understand some projects are going to be primarily rural areas but may touch on some urbanized areas, maybe a corridor terminating in an urbanized area, we will consider the project a rural project, but to the extent if more than a de minimis portion of the project is in urbanized area we are asking applicants to allocate their sort of estimated costs between the rural and urban areas so we can be sure we properly account for our requirements, to provide $140 million to projects in rural areas.
J. Symoun
The next question is: is a grant for a rural area of a state counted as part of the $150 million maximum that a single state can receive?
B. Osborne
Yes, it is.
J. Symoun
Can TIGER II funds be used to fund a construction career day?
J. Falk
No, a construction career day would not be considered an eligible project. We have had a number of projects talking about similar activities. Career days, training activities, and workforce training would not be considered capital expenditure in surface transportation for purposes of this program.
J. Symoun
Please explain discounting in benefit cost analysis section.
Darren Timothy
Rather briefly, the best way to think of, most important for discounting is that it has nothing to do with inflation, a common mistake made. Think in terms of representing the interest rate, the cost of a dollar tomorrow in today's terms. For guidance on this I refer you to the Office of Asset Management which has an economic analysis primer and a really good discussion of what discounting is all about and how to apply it.
J. Symoun
I will type in that FHWA address into the chat in a minute. The next question is a rather long one, and I will read through it. ''Economic Competitiveness'' was included in the TIGER II guidelines as an expected long-term outcome to be given priority in evaluating projects seeking federal funding. This raises a concern about modal equity, which per statutory requirements needs to be considered. This criterion is biased to benefit non-transit projects. At a prior USDOT webinar, Professor Button stated that the economic competitiveness criterion is not an adequate criterion to evaluate transit projects and advised USDOT to revisit the criteria in its final notice. Unfortunately, this was not done in the final notice. Similarly, the State of Good Repair criterion of TIGER II is biased to benefit existing projects, making it more difficult to proposed transit capital projects to compete fairly with rehabilitation projects? In this regard, the TIGER II guidelines expect that projects are to contribute to the competitiveness of the United States over the medium to long term, as required by USDOT.
B. Osborne
Well, I would disagree strongly with those statements; and I think if you look at the modal split of the TIGER I awardees, it would not bear that out. Transit was about 26% of the awardees, highways were about 24%, and rail was a little bit larger with around 8% multi-modal. I don't think the results bear that out. Also, I have to say, in terms of performance measures, transit projects are very familiar with having to justify their performance in terms of the competitive process of New Starts. This is a new thing for highways, and something some of those struggled with, quite frankly. In terms of a transit project you can show major economic competitiveness, supporting business along the line, in support of saving the transit users funding because folks who have access to multiple modes of transportation spend less overall on transportation, put that money back in the economy. It's just not the case. In terms of state of good repair, all modes are in the same bucket here where you have to value maintaining current assets against building new needed assets. It's a challenge the overall transportation system faces. In terms of transit, a community that wants to build a new transit line will certainly struggle in our process if they are showing they can't maintain their current transit system, but the same is true in terms of highway capacity, if a community wants to build a major leg of new highway, but is seeing their highway system fall apart, that would not be as competitive. So, like I said, TIGER I does not bear that out.
D. Timothy
As we said earlier, it's not expected every project will score exceedingly well in every particular category, and with regard to economic competitiveness, in the actual guide lines for benefit cost analysis focus on things like travel time saving, effecting efficiency of the transportation system, contribute to the long-term competitiveness, not the local effect on that.
J. Falk
One thing to add on state of good repair, it's written to include the extent to which lifecycle costs approaches are considered and those expenses are accounted for and in the capital plan at the time of building the project, so this isn't exclusive for projects being rehabilitated, but state of good repair is something we want people to think about in terms of new built projects too.
J. Symoun
Are the pre-application and application deadlines the same for the TIGER II Planning Grants as with the infrastructure applications?
B. Osborne
Yes, we expect that will be the case. We are certainly hoping that the deadlines will be the same.
J. Falk
Definitely, the Notice of Funding Availability for the Planning Grants will include that information and you should monitor the Federal Register to be sure to get that information.
J. Symoun
There is a webinar in the Planning Grant seminar scheduled for June 15. You can register at the same site you registered for this webinar. Will you notify those not eligible after the July 16th pre-application process, but before the August date?
J. Falk
Yes, we expect to notify to the extent received from pre-application a project or applicant is not eligible, we expect to notify that applicant of the case. We don't expect this to be an overly iterative process, to the extent if there aren't any problems with your pre-application you shouldn't expect to receive a bunch of feedback. With respect to a problem with eligibility, that's something we would respond to, ask that be fixed before the application is submitted by the deadline.
J. Symoun
Regarding NEPA documentation, what if a project is likely to be exempt? What sort of documentation is required in such cases?
M. Osterhues
Applicant should identify which CE would be applicable under the different categorical exclusions in the NEPA process or procedure. We would recommend in the application you would identify the coordination that's been done to date with the regional and local office. And if there has been any compliance with other environmental laws, it would important to include that in documentation.
J. Symoun
Is the pre-application still required for the project to be eligible for the grant?
J. Falk
Yes, the pre-application has to be submitted before an application can be submitted. Any application would have to have had a pre-application submitted beforehand.
J. Symoun
Can you clarify whether planning grant requests acceptable at this point and if so how do minimum and maximum amounts relate?
B. Osborne
This is a question we have heard a lot, whether or not the $10 million minimum applies to planning grants. It does not apply to planning grants.
J. Symoun
What is the maximum award amount for planning grants? Is the same $10 million as for infrastructure grants?
B. Osborne
No, it is not.
J. Symoun
Can you clarify how the benefit cost analysis differs from the economic impact analysis?
D. Timothy
This is, again, back to the economic analysis primer I referred to earlier. It also has a section on this. The benefit cost analysis is briefly focused on looking at the benefits of a project to society as a whole. It looks at what happens to efficiency of transportation system, things like reducing travel times, reducing energy consumption, reducing environmental impacts like greenhouse gas emission. Economic impact analysis is focused more on local impacts associated with a construction project. One big item often in the economic impact analysis is the jobs that are associated with construction and that might be induced. The wages of those workers are not things included in economic impact and similarly in regards to real estate investment, there is economic impact, but there is impact of cost and shows up in the analysis as both a benefit and a cost. You have to spend money to make those investments. That's kind of the short version. If someone has specific questions on whether something ought to be included or not, they can certainly pose that to the Department.
J. Symoun
Will planning grants require the same detailed benefit cost analysis as infrastructure projects?
B. Osborne
I recommend people to watch the Federal Register and to tune into webinar on planning grants. It's still under discussion, but I would not expect the same sort of robust cost benefit analysis to be required for planning grants. We will certainly want to know what the benefits of an eventually project, if built, would be. It will probably require a very different intake of data.
J. Symoun
Will a rating be assigned for pre-application as well as final application?
B. Osborne
No, the pre-application process is more about determining eligibility and preparing for the review process. There will be no evaluation of the pre-applications, except for their eligibility.
J. Symoun
What would the max requirement be for a project in both urban and rural area, such as a multi-state corridor project?
J. Falk
I think to the extent you had a project which a de minimis portion of the project was in urban, but the majority of the project is in a rural area, it would have the rural requirements. To the extent if more than the de minimis portion is in the urban area, and you are able to identify and separate out the costs of the urban area from the rural area, we would then expect urban portion of the project would be appropriately matched per the statute.
J. Symoun
Are non-motorized projects eligible for the infrastructure grants?
B. Osborne
They certainly are, however, I would make sure you are focusing on projects meant to be a form of transportation; in other words, a bike system that moves people from home to work as opposed to a recreation trail.
J. Symoun
I think you answered this one already, but could the announcement date be repeated?
B. Osborne
We don't have a firm announcement date. We would like to make announcements as soon as possible.
J. Symoun
Can the TIFIA grant fund the 20% match for a project using both the Tiger II and a TIFIA grant?
D. Callender
I would think so as long as none of the other requirements are violated, but a $100 million applying for $80 million in TIGER grants and $20 million in TIFIA loans, nothing to prevent that, there may be other considerations such as competiveness or no money in the project, but there are no prohibitions.
B. Osborne
I would like to emphasize the difference between eligible and competitive. You should be shooting for beyond eligible.
J. Symoun
Can a region's STP-Urban funds that were rescinded by SAFETEA LU, but then reinstated by the HIRE Act, count as a local match?
J. Falk
In the Final Notice we provided clarification about what can be used for match. We are looking for non-federal funds for the match. So state, local, private, any of those types of funds can be used, but we're not looking for federal funds to be used to satisfy the 20% matching requirement.
J. Symoun
That pretty much addresses the next question which was could other federal funds be used for the 20% match. The next question: could Tiger II or TIFIA Grants be used to fund retrofitting curbs at driveways that are not in ADA compliance. A person in a wheel chair cannot travel on the sidewalk because every driveway access has a curb. In addition to this, if the concrete driveway pads could be retrofitted as ribbon driveways to help prevent runoff? If a MPO asked for funds and then makes the fund voluntary to property owners, and the actual 20% match would come from the individual in an assessment.
B. Osborne
The first part is yes; in terms of ADA compliance, you would make the claim that this is creating an actual bike-ped system because you are removing barriers to be able to utilize it particularly for folks with disabilities. In terms of creating a program where the MPO would then match the local private investment, I think it would be a struggle to show exactly when and how that money would be expended and what the final outcome would be. If it was something worked out in the past, you knew exactly what the universe of projects would be, that would be something that could be considered, but in creating a revolving fund, I wouldn't think that would be something we could fund.
J. Symoun
With limited funding available, how can any project demonstrate independent utility, such as each phase stands on its own when we're talking projects that are regionally/nationally significant?
B. Osborne
We saw a great number of projects in the TIGER I process that had put together a vast array of funding from different sources, the TIGER funds would be the part that complete the funding package. We also found a large number of projects that had various phases to them, maybe asking for the final phase, maybe the first phase of a larger project planned out into the future, but we did find a large number of national and locally significant projects that we funded in TIGER I, even with limited dollars, that were able to satisfy these criteria.
J. Falk
In this it is important to note to the extent that we have nationally significant project through many states, regions, it's not necessarily the case only completing a full project is going to provide independent utility. Very often there's a number of segments or components of the project, each of which provides independent utility on its own despite the fact it's part of a much larger national project. For example, CREATE is a package of many projects together providing a huge amount of national benefits. There are many components within CREATE, each providing independent utility, despite the fact they are part fact they are part of a national overall project.
J. Symoun
Could the required 20% match be comprised of a combination of local dollars, right-of-way donation or other non-monetary contribution?
J. Falk
It would be important to quantify a non-monetary contribution, turn into a sum of money to determine how much of the match that would be required, count for. To the extent state or local governments, private entities are contributing non-monetary matches then that's something that could be considered.
J. Symoun
With respect to independent utility, could the funding being sought for a final phase of a multi-phased project?
B. Osborne
Absolutely.
J. Symoun
What are considered eligible costs? Would support facilities for non-motorized pathways (e.g., benches, restrooms) be eligible? What about property easements?
J. Falk
You have to look at those individually. There are some support facilities which are certainly integral to the non-motorized path, but at a certain point you have lost the nexus to the actual transportation project. This might be another one of the examples where matching funds or the TIGER funds clearly for transportation portion and the extent you lose the nexus or move to portions not transportation infrastructure, other funds could be used on those. TIGER funds have to be used for transportation components. You have to look on a case-by-case basis, what the facilities are to make the determination.
B. Osborne
Make sure you make your case very clear about why that element is necessary for that form of transportation. So if the bench is part of a bus stop, for example, you can see that nexus very clearly. If the bench is part of a park on the way along a sidewalk, that nexus would not be terribly clear.
J. Symoun
Does the requirement for equitable geographic distribution of funds only apply to the TIGER II grants, or will the TIGER I awards be factored into the TIGER II award decision-making?
B. Osborne
They apply only to the TIGER II grants. TIGER I awards will not be factored in the TIGER II decision making in terms of equitable distribution.
J. Symoun
Do projects submitted for consideration under TIGER II have to be listed on current MPO/TPO/FDOT priority lists?
H. Miller
Projects do have to be included in the Metropolitan Transportation Planning TIP, however there's a provision where if they are not in the current planning TIP, the applicant can submit a certification that they will be in the planning TIP prior to the grant being issued.
B. Osborne
I would like to add one thing to the question before, the last part, does the TIGER I award impact the decision making process for TIGER II. It does not directly impact it, but however you have a tough case to make if you have not built your TIGER I project on why you should get additional funding.
J. Symoun
When do projects have to be completed?
B. Osborne
There's no completion date, but you have to have them obligated by September 30, 2012.
J. Falk
That is different from the TIGER I Program where there was a Recovery Act requirement which no longer applies. I think there is a statutory expiration date for these funds, several years out, I don't remember exactly. We can check and post an answer.
B. Osborne
I would point out that job creation is a very important criterion. While there's not a statutory deadline, if it's not clear when the funds will be expended it will not be as competitive.
J. Symoun
It is 2:30 now so unfortunately, I know a lot of questions are not addressed, but we will have to close out for today. Some people did ask what was going to happen with these question and answers. They will be posted to the web address showing on the screen right now.
J. Falk
Yes, we will post the questions and answers. And in addition, we will be collecting questions from a number of different sources right now. We will be putting the questions together and throughout the summer as we lead up to the application deadline date, post on a regular basis frequently asked questions and responses. So, I would encourage everybody to monitor that website for additional clarifications, responses to questions.
J. Symoun
Okay. We will get the rest of the questions included that haven't been addressed. I will include the email address, freight@dot.gov, if you think of additional questions you can send them there as well. Thank you all for attending today's seminar. The recorded version of this event will be available within the next few weeks on the Talking Freight website.
As a reminder, if you are an AICP member and would like to receive 1.5 Certification Maintenance credits for attending this seminar, please make sure you were signed in today with your first and last name or type your first and last name into the chat box if you are attending with a group of people. Please download the evaluation form and email it to me after you have completed it. Please also download the CM Credit instructions if you are unsure of how to obtain your credits for today's seminar.
The next TIGER II webinar will be held on June 15 and will cover TIGER II Planning Grants Webinar. There will also be a regularly scheduled Talking Freight on June 16 on Promoting Economic Revitalization Through Enhancing Freight Transportation.
If you haven't done so already, I encourage you to visit the Talking Freight Web Site and sign up for these seminars. The address is up on the slide on your screen. I also encourage you to join the Freight Planning LISTSERV if you have not already done so.
Enjoy the rest of your day!
