U.S. Department of Transportation
Federal Highway Administration
1200 New Jersey Avenue, SE
Washington, DC 20590

Skip to content U.S. Department of Transportation/Federal Highway AdministrationU.S. Department of Transportation/Federal Highway Administration

Federal-aid Program Administration



In 2006, FHWA conducted a national review of federal-aid projects administered by local public agencies (LPAs) (A copy of the report is available from the Program Improvement (PMI) Team 404-562-3578.). This review found that the administration of Federal-aid projects by LPAs appeared to lack a systematic or comprehensive oversight approach. Also the findings further suggested that current oversight activities, as a whole, may be inconsistent from State to State; and that current oversight activities may be ineffective for ensuring that Federal-aid requirements are met on LPA-administered projects.

Subsequent reviews by our Division offices in 2007 and 2008 confirmed many of the initial deficiencies observed in the 2006 national review. One of the most common findings was a lack of knowledge on the part of LPAs of the processes and procedures for establishing and administering federal-aid projects, as well as knowledge of the federal and state requirements that need to be met in order to secure and maintain federal funding.

Since 2007 Local Public Agency (LPA) administered Federal-aid projects have been under a self-declared internal control material weakness. Further LPA administered Federal-aid projects have also been a noted elevated risk at the FHWA’s corporate level. As a part of advancing strategic Risk-Based Stewardship and Oversight (RBSO) efforts have been focused on identifying and responding to LPA program risks pertaining to compliance with Federal requirements.

On July 15, 2011 the Office of Inspector General (OIG) issued an audit report, MH-2011-146 - Federal Highway Administration’s Oversight of Federal-Aid and Recovery Act Projects Administered by Local Public Agencies Needs Strengthening. The objectives of the audit were to assess the extent of LPA compliance with Federal requirements and to assess the effectiveness of FHWA’s actions. Based on the findings of the review, the OIG made recommendations to establish uniform procedures and criteria to assess State oversight of LPAs and to develop a process to assess the effectiveness of LPA corrective action plans.

On January 16, 2014 the Government Accountability Office (GAO) issued an audit report, GAO-14-113 - Federal-Aid Highways: Federal Highway Administration Could Further Mitigate Locally Administered Project Risks. The report identified three areas of risk with project administration by local agencies. These risks included: non-compliance with Federal requirements; ineffective oversight; and inefficient us of Federal funds.

This public website is established in part to aid our partners by providing information and tools in improving/solving the deficiencies noted above.

Updated: 06/27/2017
Federal Highway Administration | 1200 New Jersey Avenue, SE | Washington, DC 20590 | 202-366-4000