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Summary of FHWA EDA Implementation
The priority for selecting projects located in Economically Distressed Areas (EDAs) was one of several priorities that States needed to address in making project selections under the 2009 American Recovery and Reinvestment Act (Recovery Act). Selection factors in the Recovery Act included giving priority not only to EDAs, but also to projects that could be completed in three years, to "quick-start" projects, to projects that maximize job creation and economic benefit, and to projects that were ready to be placed under obligation within the 120-day and 1-year time frames. In addition, as part of project selection, the States needed to satisfy Title 23 U.S.C. requirements, including the planning requirements.
The Federal Highway Administration (FHWA) took several actions to implement the EDA provision in the Recovery Act, including development of an online tool for States to map projects by EDA counties. The online tool provided data (low per capita income and/or unemployment rate above national average) in a geographic information system map format to assist States in determining whether or not their projects were located in EDAs as defined in the Public Works and Economic Development Act of 1965 (PWEDA), as amended. The maps are available online at: http://hepgis.fhwa.dot.gov/.
The FHWA also issued guidance on the implementation of the EDA provision. Soon after the Recovery Act was enacted, guidance was provided via email to FHWA Division Offices to use in coordinating with States on the evaluation of EDAs in their project selection. Written questions and answers that address EDAs were provided on the FHWA Recovery website (https://www.fhwa.dot.gov/economicrecovery/edaqanda.htm). In addition, FHWA coordinated with the Department of Commerce on special needs designations under PWEDA. On August 24, 2009, FHWA issued guidance establishing criteria and procedures for EDA special needs designations (https://www.fhwa.dot.gov/economicrecovery/guidancedistressed.htm). The guidance also requested States identify the basis for any future EDA determination for a project. Additionally, guidance was issued via email to FHWA Divisions on June 10, 2010, that instructed States, going forward from the date of the email, not to code a project as an EDA project based on a "special need" criterion unless both the Division Office and Headquarters had reviewed and determined the adequacy of the documentation to meet the "special need".
Throughout the life of the Recovery Act, FHWA worked with States to encourage project selection in EDAs. Secretary LaHood contacted State Governors seeking their continued support and focus on prioritizing projects in EDAs. The FHWA Division Offices worked pro-actively with the States throughout the life of the Recovery Act to verify the States' procedures for making EDA designations and to improve States' levels of obligation of Recovery Act funding in EDAs.
The FHWA also provided oversight on States' use of special needs designations in accordance with the FHWA guidance issued August 24, 2009. When concerns arose that early State EDA special needs designations may not have satisfied PWEDA requirements, FHWA Headquarters reviewed the designations in question. Subsequently, FHWA issued the August 2009 guidance referenced above. The FHWA Division Offices continued to conduct first level reviews where States designated EDAs based on criteria other than the PWEDA per capita income and unemployment statutory standards. In those few States where questions arose about special needs designations, FHWA Headquarters worked with the Divisions to review the State's approach to the designations. Where a State's approach was determined to be inconsistent with the August 2009 guidance, FHWA asked the State either to provide data supporting a special need designation consistent with guidance or to correct the EDA status of the affected projects. FHWA also offered to work with those States (e.g., Arizona, California, and Illinois) to determine whether sub-county level unemployment and per capita income data supported an EDA designation.
On September 20, 2010, the General Accountability Office (GAO) issued a report entitled "Recovery Act: Opportunities to Improve Management and Strengthen Accountability over States' and Localities' Use of Funds" (GAO-10-999). In that report, GAO recommended that FHWA make publicly available an accurate accounting and analysis of the extent to which States directed their Recovery Act funds to EDAs. Attached is the accounting of the extent to which States directed their Recovery Act funds to projects located in EDAs.
The FHWA requested that States designate in the Recovery Act Database System (RADS) whether a project that was receiving Highway Infrastructure Investment funds under the Recovery Act was located in an EDA at the time the Recovery Act funds were obligated. To verify the accuracy of the data, FHWA compared the EDA data with the maps of the EDA counties. Some counties were designated as an EDA the entire duration of the Recovery Act and all projects located in such counties were counted as being located in an EDA. Some counties were never designated as an EDA the entire duration of the Recovery Act and, unless other special circumstances applied, all projects located in these counties were not counted as being located in an EDA. Some counties were designated as an EDA during part, but not all, of the Recovery Act period and FHWA reviewed all projects in these counties. In all, the FHWA reviewed 4,213 projects (33% of all projects), which resulted in changes to the EDA designation for 959 projects (7% of all projects).
Review of the projects involved checking the obligation date in relation to the data source indicated for the States' EDA determination, and in a number of cases, comparing that information to the map as of the obligation date of the project to make a determination. When sufficient information was available, sub-county data, which applied the low per capita income/unemployment rate criteria to a political subdivision below the county level, was used to make an EDA determination. Where a State used special documentation, as was the case relative to natural disasters in Louisiana, a determination was made as to the acceptability of that information.
After the data in RADS was reviewed, adjustments were made to the cumulative state totals for projects located in EDAs. Based on the analysis described above, the nationwide percentage of highway Recovery Act-funded projects located in EDAs is 56% after the analysis (with rounding), compared to 57% before (also with rounding). The net change as a result of the FHWA review was a decrease of 125 projects designated EDA (marginally less than 1% of all projects). Of note are several States and territories that had significant increases/reductions (more than 25 projects) or percentage change (greater than 10%) in the number of projects designated EDA. These include California, the District of Columbia, Florida, Indiana, Kansas, Ohio, Oklahoma, Oregon, Pennsylvania, South Dakota, and Vermont.
This data constitutes the FHWA's accounting to the public of the percentage of highway Recovery Act projects that were located in EDAs at the time the Recovery Act funds were obligated to the project.
Economically Distressed Areas Project and Funding Distribution by State
* For these territories, EDA criteria not available. For purposes of this report, when not otherwise indicated for these territories, all ARRA funding and projects are shown as being in an EDA. The estimated percentage population in EDAs for these areas is not determined and is listed as N/A.