Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU) Sections 1301 (Projects of National and Regional Significance),
1302 (National Corridor Infrastructure Improvement Program) &
1306 (Freight Intermodal Distribution Pilot Grant Program)

Date Issued January 4, 2006

Frequently Asked Questions

1. Must grants be provided to the State, or may they be provided to some other agency?
2. Does the Federal Highway Administration (FHWA) have the authority to make a direct grant to a non-State DOT entity?
3. May sub-recipients be private railroad companies or other private corporations?
4. For projects designated under Section 1301, must each sub-project individually meet minimum funding eligibility requirements ($500M or 75% of a State's Federal-Aid)?
5. What are the non-Federal matching requirements?
6. May project descriptions for sub-projects be submitted individually?
7. May funds be transferred between agencies?
8. May funds be reallocated between agencies?
9. May projects be administered by agencies other than the FHWA?
10. May funds be transferred among projects?
11. How will funds for multi-State projects be allocated among the affected States?
12. Are the designated projects in Sections 1301, 1302, and 1306 subject to the requirements of title 23 of the United States Code?
13. May funds be used in public-private partnerships?
14. Is there a due date for submitting project descriptions?

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1. Must grants be provided to the State, or may they be provided to some other agency?

   Unless otherwise specified in the law, all grants awarded under Sections 1301, 1302, and 1306 shall be provided to the indicated State. Grant recipients, other than States, specified in the law, such as the Port Authority of New York and New Jersey (SAFETEA-LU Section 1959) may request that the funds be allocated to the States in order to expedite the processing of the funds.

2. Does the Federal Highway Administration (FHWA) have the authority to make a direct grant to a non-State DOT entity?

   No. The FHWA may only make direct grants to non-State DOT entities where such entities are specified in statute. It is clear that Sections 1301, 1302, and 1306 require that funds be distributed to a State. The FHWA's long-standing practice is to distribute funds through the State DOTs. This policy is based on the FHWA’s interpretation of 23 U.S.C. §302 and its implementing regulation 23 CFR 1.3, which specifically requires that the FHWA Administrator cooperate with "States through their respective State highway department."

3. May sub-recipients be private railroad companies or other private corporations?

   The answer to this question will depend on whether a State has the legal authority under State law to provide Federal funds to a private grantee that is not a State or local governmental agency. A subrecipient is a recipient of the grantee and the grantee remains responsible for ensuring all Federal requirements for a designated project are met. (See the 49 CFR 18.3 definitions of "subgrant" and "subgrantee.")

4. For projects designated under Section 1301, must each sub-project individually meet minimum funding eligibility requirements ($500M or 75% of a State's Federal-Aid)?

   No, the funds have been allocated to designated projects in the legislation, and as such no other project-cost requirements must be met. However, per the guidance, projects will still need to include cost estimates and funding disclosures.

5. What are the non-Federal matching requirements?

   For Section 1301, there is a 20% non-Federal matching requirement. However, under Section 1964 of SAFETEA-LU, Alaska, Montana, Nevada, North Dakota, Oregon, and South Dakota are permitted to use the provisions of 23 U.S.C. §120(b) for determining the non-Federal match requirements for projects listed in Section 1301. For Sections 1302 and 1306, the non-Federal matching requirements are governed by 23 U.S.C. §120.

6. May project descriptions for sub-projects be submitted individually?

   No, all sub-projects must be included in the initial project description.

7. May funds be transferred between agencies?

   Funds made available under law may be transferred from one appropriation account and credited to another account or fund only when authorized by law. (See 31 U.S.C. §1532.) Sections 1301 and 1306 specifically prohibit the transfer of funds from the FHWA to another agency. However, Section 1302 does not prohibit the transfer of funds and funds may be transferred pursuant to the authority of 23 U.S.C. §104(k) to the Federal Transit Administration for capital costs for transit projects eligible for assistance under chapter 53 of title 49. Under 23 U.S.C. §104(k)(3) funds may be transferred at the request of a State to another State or the Federal Highway Administration provided the funds are expended on title 23-eligible projects. Funds also may be transferred pursuant to the provisions of 23 U.S.C. §132 when a Federal agency will be the contracting agency for a proposed Federal-aid project.

8. May funds be reallocated between agencies?

   Yes, funds may be reallocated from the FHWA to another agency. This is not a transfer of funds as defined by 31 U.S.C. §1532 because the funds are not removed from the Federal-aid tracking system. The original recipient is ultimately responsible for ensuring that the project meets the applicable Federal-aid requirements.

9. May projects be administered by agencies other than the FHWA?

   Yes, but the FHWA must be part of the project oversight team and kept up to date on project happenings.

10. May funds be transferred among projects?

    Generally, no, except as expressly allowed under SAFETEA-LU Section 1935. (Please refer to the Flexibility Provisions discussion in the Implementing Guidance issued in December 2005 for the High Priority Projects Program (SAFETEA-LU Section 1701) for additional information pertaining to project flexibility.)

11. How will funds for multi-State projects be allocated among the affected States?

    Unless otherwise requested by the affected States, the default allocation will be an equal distribution among States. However, it is preferable for affected States to jointly determine the most appropriate allocation of funds, and request a reallocation as part of the project description submitted to the FHWA.

12. Are the designated projects in Sections 1301, 1302, and 1306 subject to the requirements of title 23 of the United States Code?

    Yes, unless exceptions are expressly indicated in the law.

13. May funds be used in public-private partnerships?

    Generally yes, subject to agreement with State laws.

14. Is there a due date for submitting project descriptions?

    No, there is not an established due date for submitting project descriptions. Please note that the allocation of funds will be made, on a project-by-project basis, after the appropriate descriptions are submitted.