[Federal Register: January 6, 2006 (Volume 71, Number 4)]
[Notices]
[Page 970-977]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr06ja06-80]
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DEPARTMENT OF TRANSPORTATION
Federal Highway Administration
Safe, Accountable, Flexible, Efficient Transportation Equity Act:
A Legacy for Users (SAFETEA-LU); Value Pricing Pilot Program
Participation
AGENCY: Federal Highway Administration (FHWA), DOT.
ACTION: Notice; solicitation for participation.
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SUMMARY: This notice invites State and local governments and other
public authorities to apply to participate in the Value Pricing Pilot
(VPP) program and presents guidelines for program applications. This
notice describes the statutory basis for the VPP program and updates a
notice published in the Federal Register on May 7, 2001 (66 FR 23077),
by providing revised procedures, process timelines, and guidance for
program participation.
A companion notice referring to non-grant programs, entitled
``Safe, Accountable, Flexible, Efficient Transportation Equity Act: A
Legacy for Users (SAFETEA-LU); Opportunities for
[[Page 971]]
States and Other Qualifying Agencies to Gain Authority to Toll
Facilities Constructed Using Federal Funds'' is published elsewhere in
today's edition of the Federal Register. Both of these notices are
intended to cover all of the opportunities for States and other
qualifying transportation agencies to obtain approval to toll their
respective facilities and to secure funding to implement tolling and
pricing.
DATES: Formal grant applications must be submitted no later than March
31, 2006, for FY 2006 funds, October 1, 2006, for FY 2007 funds, and
each subsequent October 1 for funding through and including FY 2009. To
be assured of the maximum amount of constructive assistance from FHWA
in preparing a formal application, Expressions of Interest must be
submitted two months prior, i.e., by January 31, 2006, for FY 2006
funds, August 1, 2006, for FY 2007 funds, and each subsequent August 1
covering the funding period.
FOR FURTHER INFORMATION CONTACT: For questions about this notice,
please contact Mr. Wayne Berman, Office of Operations, (202) 366-4069,
or via email at mailto:wayne.berman@fhwa.dot.gov, FHWA, 400 Seventh
Street, SW., Washington, DC 20590. For specific information about the
Value Pricing Pilot Program, please contact Mr. Patrick DeCorla-Souza,
Office of Policy and Governmental Affairs, Highway Pricing and System
Analysis Team Leader, (202) 366-4076, or via e-mail at
patrick.decorla-souza@fhwa.dot.gov. For legal questions, interpretations and counsel,
please contact Mr. Michael Harkins, Attorney Advisor, FHWA Office of
the Chief Counsel, (202) 366-4928, or via e-mail at
michael.harkins@fhwa.dot.gov. Office hours for the FHWA are from 7:45
a.m. to 4:15 p.m., e.s.t., Monday through Friday, except Federal
holidays.
SUPPLEMENTARY INFORMATION:
Electronic Access
An electronic copy of this document may be downloaded from the
Federal Register's home page at: http://www.archives.gov and the Government Printing Office's database at: http://www.access.gpo.gov/
nara.
Background
Section 1012(b) of the Intermodal Surface Transportation Efficiency
Act (ISTEA) (Pub. L. 102-240; 105 Stat. 1914), as amended by section
1216(a) of the Transportation Equity Act (TEA-21) (Pub. L. 105-178; 112
Stat. 107), and section 1604(a) of Safe, Accountable, Flexible,
Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU)
(Pub. L. 109-59; 119 Stat. 1144), authorizes the Secretary of
Transportation (the Secretary) to create a Value Pricing Pilot Program.
Value pricing encompasses a variety of strategies to manage congestion
on highways, including tolling of highway facilities, as well as other
strategies that do not involve tolls, such as mileage-based charges for
insurance, taxes, leasing fees, and car sharing. The value pricing
concept of assessing relatively higher prices for travel during peak
periods is the same as that used in many other sectors of the economy
to respond to peak-use demands. For example, airlines, hotels, and
theaters often charge more for peak than non-peak times.
The FHWA is seeking applications for the FY 2006 VPP program.
According to statute, the FHWA may enter into cooperative agreements
with up to fifteen State or local governments or other public
authorities (hereafter, States) to establish, maintain, and monitor
value pricing pilot programs, each including an unlimited number of
projects. The FHWA invites interested States to apply to participate in
the VPP program for FY 2006. There are already fourteen State-led
programs currently in the VPP program: California, Colorado, Florida,
Georgia, Illinois, Maryland, Minnesota, New Jersey, North Carolina,
Oregon, Pennsylvania, Texas, Virginia, and Washington. Therefore, only
one new State is eligible to participate. 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
prohibiting tolls on the Interstate system as contained in 23 U.S.C.
129 and 301.
A maximum of $12 million is authorized for each of the fiscal years
2006 through 2009 to be made available to carry out the VPP program
requirements. A set-aside of $3 million per fiscal years 2006 through
2009 is authorized only for value pricing pilot projects that do not
involve highway tolls. The Federal share payable under the program is
80 percent of the cost of the project. Funds allocated by the Secretary
to a State or other public entity 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
VPP program, but not allocated, exceeds $8 million, the excess amount
will be apportioned to all States as Surface Transportation Program
funds.
Funds available for the VPP program can be used to support pre-
implementation study activities as well as to pay for implementation
costs of value pricing projects. Section 1012(b)(6) of ISTEA provides
that a State may permit toll-paying 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. SAFETEA-LU Section 1121, ``HOV Facilities,'' among other
things, also allows for the conversion of HOV lanes to high occupancy
toll (HOT) lanes. Given that the VPP program has only one more slot
available for a new program partner to participate, Section 1121
authority should be used, instead of VPP program authority, for HOV-to-
HOT lane conversions if an application comes from a State that is not
already in the VPP program.
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, toll discounts or credits for low-income
motorists who do not have viable transit options, or fare or toll
credits earned by motorists on regular lanes which can be used to pay
for tolls on priced lanes. Mitigation measures can be included as part
of the value pricing project implementation costs.
The Secretary is required to report to Congress every two years on
the effects of all value pricing pilot programs. Annual evaluation data
and reports shall be provided to the FHWA for use in reports to
Congress.
The VPP program is a continuation of the Congestion Pricing Pilot
Program authorized by section 1012(b) of the ISTEA and amended by
section 1216(a) of TEA-21. To obtain up-to-date information on the
status of current projects, please go to: http://www.ops.fhwa.dot.gov/tolling_pricing/index.htm
and go to ``Resources'' and click on ``Value
Pricing Pilot Program Knowledge Exchange''.
In addition to the VPP program, SAFETEA-LU offers States broader
authority to use tolling on a pilot or demonstration basis to finance
Interstate construction and reconstruction, promote efficiency in the
use of highways, and support congestion reduction by providing expanded
flexibility under the following programs: HOV facilities; Interstate
System Reconstruction & Rehabilitation Pilot; Interstate System
Construction
[[Page 972]]
Toll Pilot; and Express Lanes Demonstration Program. For more
information on those programs, please refer to the companion notice in
today's Federal Register entitled ``Safe, Accountable, Flexible,
Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU);
Opportunities for State and Other Qualifying Agencies to Gain Authority
to Toll Facilities Constructed Using Federal Funds.''
What Is Value Pricing?
``Value pricing,'' ``congestion pricing,'' ``peak-period pricing,''
``variable pricing,'' and ``variable tolling'' are all terms used to
refer to direct non-constant 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 achieve
congestion reduction, improved air quality, energy conservation, and
transit productivity goals.
A ``value pricing project'' means any implementation of value
pricing concepts or techniques discussed in the ``Potential Project
Types'' section of this notice and included under a State or local
``value pricing pilot program,'' where such a program includes one or
more value pricing projects serving a single geographic area, such as a
metropolitan area or State. By definition, an entity with one or more
approved value pricing projects must have a value pricing program.
While the distinction between ``project'' and ``program'' may appear to
be merely a technical one, it is significant in that, as described in
the ``Background'' section of this notice, the number of total VPP
programs is statutorily limited to fifteen, while there is no limit to
the number of VPP projects allowed under each VPP program.
``Cooperative agreement'' means the agreement signed between the
FHWA and a State to implement local value pricing pilot programs (See
49 CFR Part 18). ``Toll agreement'' means the agreement signed between
the FHWA and a State to grant the authority to collect tolls.
Program Objective
The overall objective of the VPP 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 these effects. The VPP program's primary focus is on value
pricing with road tolls, with a secondary focus on other market-based
approaches for congestion relief that do not involve road tolls, such
as parking pricing or pay-as-you-drive insurance. All projects should
incorporate significant pricing mechanisms intended to reduce the level
of congestion.
Potential Project Types
The FHWA is seeking applications 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. As such, value pricing charges need to be targeted at
vehicles causing congestion, and prices must be set at levels
significant enough to encourage drivers to use alternative times,
routes, modes, or trip patterns during congested periods. Conversely,
proposed projects that contemplate value pricing charges that are not
significant enough to influence demand, such as minor increases in fees
during peak-periods, or moderate toll increases instituted primarily
for financing purposes, will be given low priority. Similarly, value
pricing concepts that have become mainstream and have been adopted as
common practice, such as HOV-to-HOT lane conversions, will not be
funded. 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 priority
for Federal support. Projects of interest include:
1. Applications of value pricing which are comprehensive and
include pricing of currently free facilities, such as area wide
pricing, pricing of multiple facilities or corridors, and/or
combinations of road pricing and parking pricing. The size or extent of
road pricing programs, ranging from single facilities, to sections of,
or complete corridors, to comprehensive area- or region-wide
applications, are of interest, along with their relative effect on
reducing congestion, altering travel behavior, and encouraging the use
of other transportation modes. Region-wide pricing applications that
use technologies that provide drivers with real-time congestion and
pricing information on alternative routes are especially encouraged.
2. Pricing at key traffic bottlenecks, of multiple facilities in a
single travel corridor, or on single highway facilities, including
bridges and tunnels. Applications to shift from a fixed to a variable
toll schedule on existing toll facilities are encouraged (i.e.,
combinations of peak-period surcharges and off-peak discounts). Pricing
of queue jumps is also eligible. A queue jump is defined as a facility
that can be used by certain types of traffic to bypass points on the
transportation network where congestion is particularly severe and
occurs in a predictable pattern (colloquially called ``bottlenecks'').
Queue jumps can be as elaborate as an elevated facility or as simple as
an at-grade lane addition.
3. Innovative parking pricing strategies, including time-of-day
pricing and charges reflective of congestion conditions, provided the
level and coverage of proposed parking charges is sufficient to reduce
congestion. Parking pricing strategies that are integrated with other
pricing strategies are encouraged. Parking pricing strategies should be
designed to influence trip-making behavior, and might include
surcharges for entering or exiting a parking facility during or near
peak periods, or a range of parking cash-out policies, where cash is
offered to employees in lieu of subsidized parking, parking operators
reimburse monthly patrons for unused parking days, or renters or
purchasers in multi-family housing developments are provided direct
financial saving for not availing of car parking spaces. Pricing of a
single parking facility, coverage of a few employee spaces, or pricing
of parking spaces in a small area, for example, are unlikely to receive
priority, unless they incorporate a truly unique element which might
facilitate broader applications of value pricing across local areas or
States.
4. Pay-as-you-drive pricing, including car insurance premiums set
on a per-mile basis and innovative car ownership, leasing, and usage
arrangements that reduce fixed costs and increase variable usage costs.
5. Projects that are likely to add to the base of knowledge about
the various design, implementation, effectiveness, operational, and
acceptability dimensions of value pricing. The FHWA is seeking
information related to the impacts of value pricing on the following:
Travel behavior (e.g., trip lengths, mode use, time-of-travel, trip
destinations, and trip generation by private and commercial trip
makers); traffic conditions (e.g., speeds and levels of service);
implementation issues (e.g., technology, innovative pricing
[[Page 973]]
techniques, public acceptance, administration, operation, enforcement,
and legal and institutional issues); revenues, their uses and financial
plans; different types of users and businesses; and low-income
motorists, including possible mitigation measures and their
effectiveness. These diverse information needs mean that the FHWA may
fund different types of value pricing applications in different local
contexts to maximize the potential of the pilot program.
6. Projects that do not have adverse effects on alternative routes
or modes, or on low-income or other transportation-disadvantaged groups
are encouraged under the VPP program. If such effects are anticipated,
proposed pricing programs should incorporate measures to mitigate any
major adverse impacts, including enhancement of transportation
alternatives for peak period travelers, services such as ``life-line''
toll rates aimed at low income travelers, and credit-based tolling
programs such as toll credits earned by motorists in regular lanes
which can be used to pay tolls on priced lanes.
7. Pricing projects that lead to substantial congestion reduction
and supplant or supplement existing tax-based approaches for generating
surface transportation revenues.
8. Pricing projects that result in free-flow peak period roadway
conditions, and where motorists earn or are provided with limited
monetary credit for their discretionary use, thereby allowing them a
limited amount of free or discounted rush hour roadway access or
transit trips before having to pay full fees.
While the FHWA is seeking applications that incorporate some or all
of these project characteristics, these guidelines are intended only to
illustrate selection priorities, not to limit potential program
participants from proposing new and innovative pricing approaches for
incorporation in the program.
Pre-Implementation Studies
The VPP program funds may also be used to assist State and local
governments in carrying out pre-implementation study activities
designed to lead to implementation of a value pricing project. The
intent of the pre-implementation study phase 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 only as one option, will not be funded
under this program. Broad planning studies can be funded with regular
Federal-aid highway or transit planning funds. Applications for pre-
implementation studies will be selected based on the likelihood that
they will lead to implementation of pilot tests of value pricing
conforming to the objectives described in the previous section.
In cases where the FHWA has made funds available to a State for
pre-implementation studies, but the State decides not to implement the
project and has no other value pricing projects, the FHWA may proceed
to remove that State from the program and replace it with another State
in the pilot program. Since section 1012(b)(1) of ISTEA limits
participation in the pilot program to only fifteen slots (specifically,
``States, local governments or public authorities,'' colloquially
termed States), the fifteen participating States must intend to
implement value pricing projects and proceed accordingly.
Project Costs Eligible for Grant Funding
The FHWA will provide up to the statutorily allowable 80 percent
share of the estimated costs of an approved project. Funds available
for the VPP program can be used to support pre-implementation study
activities and also 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. Costs cannot be
reimbursed for longer than three years. The three-year funding
limitation will begin on the date of the first disbursement of Federal
funds for project activities. Examples of specific costs eligible for
reimbursement include the following:
1. Pre-Implementation Study Costs--Allowable pre-implementation
study costs include: Planning, public participation, consensus
building, marketing, impact assessment, modeling, financial planning,
technology assessments and specifications, and other pre-implementation
work that relates to the establishment of the value pricing project
including meeting Federal or State environmental or other planning
requirements.
2. Implementation Costs--Allowable costs include those for setting
up, managing, operating, evaluating, and reporting on a value pricing
project, including:
a. Necessary salaries and expenses, or other administrative and
operational costs, such as installation of equipment for operation of a
pilot project (e.g., Electronic Toll Collection (ETC)) technology,
video equipment for traffic monitoring, and other instrumentation),
enforcement costs, costs of monitoring and evaluating project
operations, and costs of continuing public relations activities during
the period of implementation.
b. Costs of providing transportation alternatives, such as new or
expanded transit or ridesharing services provided as an integral part
of the value pricing project. Funds are not available to replace
existing sources of support for these services.
Project implementation costs can be supported until such time that
sufficient revenues are being generated by the project to fund such
activities without Federal support, but in any case for no 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 for VPP program participation. Also, funds made available
through the VPP program may not be used to construct new highway lanes
or bridges, 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 lane
construction or the implementation of traffic control systems or
transit projects can be funded through other highway and transit
programs eligible under SAFETEA-LU and from new revenues raised as a
result of a pilot. Those interested in participating in the VPP program
are encouraged to explore opportunities for combining funds from these
other programs with VPP program funds. Nevertheless, Federal funds may
not be used to match VPP program funds unless permitted under specific
statutory authority.
Eligible Uses of Revenues
Sections 1012(b)(2) and (3) of ISTEA provide that revenues
generated by any value pricing pilot project must be used for the
project's operating costs and for projects that are eligible for
assistance under Title 23, United States Code. Also, since section
1012(b)(2) requires the Secretary to fund a pilot project until such
time that sufficient revenues are being generated to fund its operating
costs, any revenues generated by a pilot project must be applied first
to pay for pilot project operating costs. Any project revenues in
excess of pilot project operating costs may be used for any projects
eligible under Title 23, U.S. Code. A project's operating (or
[[Page 974]]
implementation) costs include any costs necessary for a project's
implementation; mitigation measures to deal with adverse financial
effects on low-income drivers; the proper maintenance of the facility;
any construction (including reconstruction, rehabilitation,
restoration, or resurfacing) of the facility; any debt service incurred
in implementing the project; and a reasonable return on investment by
any private entity financing the project. Uses of revenue are
encouraged which will support the goals of the VPP program,
particularly uses designed to provide benefits to those traveling in
the corridor where the project is being implemented.
Furthermore, for toll projects, the FHWA and the public authority
(including the State transportation department) having jurisdiction
over a facility shall enter into a toll agreement concerning the use of
toll revenue to be generated under a value pricing project. The toll
agreement will merely provide for the public authority's commitment to
use the revenues in accordance with the applicable statutory
requirements of the VPP program and to annually audit its use of toll
revenues for compliance with such requirements. The execution of a toll
agreement is consistent with the requirements of other toll programs,
such as contained in 23 U.S.C. 129, and will facilitate adequate
oversight of a State's compliance with revenue use requirements of the
VPP program. The FHWA Division Administrator, in coordination with the
Office of Policy and Governmental Affairs and Office of Chief Counsel,
will execute value pricing toll agreements.
Who Is Eligible To Apply?
Qualified applicants include local, regional and State government
agencies, as well as public tolling authorities. The VPP program term
``States'' and the Tolling and Pricing Team term ``public authorities''
may be used interchangeably for purposes of identifying that a
responsible entity will enter into process of applying to the VPP
program or another tolling program. Although project agreements must be
with public authorities, a local VPP program partnership may also
include private tolling authorities and non-profit organizations.
Program Coordination and Assistance--The Tolling and Pricing Team
The Federal Highway Administration, Office of Operations is
responsible for coordinating all tolling and pricing programs that now
exist under the Federal-aid Highway Program. In order to reduce
confusion among interested applicants, given both the number and
differing structures of the various tolling and pricing programs, the
Office of Operations has formed a working group known as the ``Tolling
and Pricing Team.''
The key role for the Tolling and Pricing Team is to assist public
authorities by directing them to the most appropriate program (or
programs), including to the VPP program, among the many options
available. Members of the Tolling and Pricing Team represent the FHWA
Offices of Operations, Policy and Governmental Affairs, and
Infrastructure--the primary offices responsible for administering each
of the tolling and pricing programs--and other oversight offices within
the U.S. DOT and the FHWA, including, but not limited to the Office of
the Secretary, and the FHWA Office of the Administrator and Office of
Chief Counsel. Members participate on the Tolling and Pricing Team
because of their direct program responsibilities or because they are
interested stakeholders in tolling and pricing programs within the U.S.
DOT.
The Tolling and Pricing Team has six purposes:
1. Coordinate all tolling and pricing activity within FHWA to
facilitate the implementation and advancement of tolling and pricing
projects and standards in the United States;
2. Receive and review all Expressions of Interest submitted to the
FHWA from public authorities;
3. Direct the public authority or partnerships designated by the
State to the tolling and pricing program (or programs) that can enable
them to accomplish the goals set forth in the ``Expression of
Interest'' section of this notice;
4. Assist the Office of Operations in the promulgation of a final
rule including requirements, standards, or performance specifications
for the interoperability of automated toll collection systems as
directed by SAFETEA-LU Section 1604(b)(6);
5. Support each of the FHWA program offices that have
responsibility for a tolling and pricing program, in advancing formal
proposals to gain approval to toll or price motor vehicles and
facilitating coordination with the appropriate FHWA Division Office;
and
6. Establish program performance goals; monitor achievements, and
prepare an annual report to Congress on the status and progress of all
tolling and pricing programs, including describing program successes in
meeting congestion reduction and other performance goals.
The Tolling and Pricing Team reviews all Expressions of Interest
for the various tolling opportunities contained in current law but does
not have responsibility to approve or disapprove specific projects.
That responsibility will remain with each of the respective FHWA
program offices responsible for administering a specific tolling or
pricing program. By requesting and reviewing all Expressions of
Interest, the Tolling and Pricing Team can effectively guide an
applicant to the most appropriate program.
The ``Expression of Interest''
A public authority that wants to request tolling or pricing
authority, or funding, is asked to submit an Expression of Interest to
the Tolling and Pricing Team in care of the FHWA Office of Operations
in Washington, DC. An Expression of Interest template can be downloaded
via the Internet by going to the Tolling and Pricing Opportunities
webpage within the FHWA Office of Operations Web site at http://www.ops.fhwa.dot.gov/tolling_pricing/index.htm.
Use of the template is
optional. The Expression of Interest may be attached as an e-mail to
TollingandPricingTeam@fhwa.dot.gov, or a hardcopy can be mailed to Mr.
Wayne Berman, FHWA Office of Operations, Room 3404, 400 Seventh Street,
SW., Washington, DC 20590. Concurrently, the Expression of Interest
should be copied to the respective State FHWA Division Office.
The Expression of Interest is a document--in letter, memo, or
report format--that provides the rationale for funding or tolling
authority and information about the intended project. A complete
Expression of Interest, based upon the information items listed below,
will enable the Tolling and Pricing Team to provide the best assistance
and identify the range of options possible to meet intended goals and
timeframes.
The information items requested for a complete Expression of
Interest are as follows:
(a) A description of the agency or requesting authority or
authorities that is/are requesting this tolling authority where
applicable;
(b) The name, title, email address, and phone number of the person
who will act as the point of contact on behalf of the requesting
authority or authorities;
(c) A statement concerning the action being sought:
(i) Funding and/or tolling authority via the Value Pricing Pilot
program to support either pre-project study activities or
implementation activities as permitted; or
[[Page 975]]
(ii) Only authority to toll either existing or planned facilities;
(d) A description of the subject facility or facilities proposed to
be tolled;
(e) Whether the subject facility is an Interstate or non-Interstate
facility;
(f) Whether construction is involved and, if so, whether this is
new construction, expansion, rehabilitation, reconstruction, or other;
(g) Whether an HOV lane or lanes currently exist on the facility;
(h) A timetable to enact tolling (or modify tolling) on the subject
facility;
(i) Any expressions or declarations of support from public
officials or the public, i.e., specifically, any public meetings that
were held. If no public meetings or expressions of support are
available, please indicate if there are project plans for ensuring
adequate public involvement and support prior to implementation;
(j) A plan for implementing tolls on the facility, where
applicable. Where known, the range of anticipated tolls and the
strategies to vary toll rates (i.e., the formulae for variable
pricing);
(k) The reasons for implementing tolls, such as financing
construction, reducing congestion, or improving air quality;
(l) A description of the public agency or agencies that will be
responsible for operating, maintaining, and enforcing the tolling
program; and
(m) A description of how, if at all, any private entities are
involved either in the up-front costs to enact tolling, or the cost
sharing or debt retirement associated with revenues.
Program Participation--Overview of the Process
Submitting an Expression of Interest initiates a review process by
the Tolling and Pricing Team that leads to a recommendation as to which
tolling or pricing program (or programs) will be appropriate and
available to meet the goals of the public authority. In some cases, if
more than one tolling program is available, the Tolling and Pricing
Team will work with the public authority to help select the one program
that is most appropriate and is most likely to lead to project
approval. If the public authority prefers applying to a tolling program
other than the one recommended, the Tolling and Pricing Team will defer
to this request; however, the Tolling and Pricing Team will also
provide advice as to the pros and cons of the decision.
Once there is agreement between the public authority and the
Tolling and Pricing Team as to the most appropriate program, the
applicant will be referred to the specific FHWA program office
responsible for administering that tolling and pricing initiative. The
FHWA program office will then provide the public authority with the
necessary information on how to formally apply for authority to toll
motor vehicles and, in the case of the VPP program, request funding.
Once a formal application is submitted, the appropriate FHWA
program office will review the application and determine whether or not
to approve the proposed project. The public authority will then be
notified as to the determination. If approved, a formal tolling
agreement and/or cooperative agreement will be prepared between the
FHWA and the public authority. The toll agreement must be executed with
the FHWA and address the use of revenues that are collected from the
operation of the toll facility. While program elements may vary, the
restrictions generally require the revenues to be used first for debt
service, reasonable return on the investment for private parties, and
the operations and maintenance of the facility. In addition, if the
facility is being adequately maintained, any revenues in excess of
these uses may be used for other title 23 U.S.C. eligible purposes. The
FHWA, the State Department of Transportation, and the relevant toll
authority or local governmental entity, if any, will execute the toll
agreement, and in the case of the VPP, also a ``cooperative agreement''
that defines the scope of work that will be funded.
Summary of the Two-Step Review Process
The entire review process, resulting in the execution of a toll
agreement and/or a cooperative agreement, can be summarized in two
steps as follows:
Step #1: Submit an Expression of Interest to the Tolling and
Pricing Team. The Tolling and Pricing Team will review the Expression
of Interest, advise the applicant as to which program or programs are
candidate to their project, and provide counsel as to which of those is
most appropriate to pursue. The applicant will be directed to contact
the selected program office, wherein, the program office will then
inform the public authority as to the procedures required for
submitting a formal application for tolling authority and/or value
pricing funding.
Step #2: Submit a formal application for tolling or pricing
authority or value pricing funding to the FHWA program office for
formal review, ultimately leading to a decision on approval. The public
authority will then be notified of the decision. If the project is
approved, a formal tolling agreement (and in the case of the VPP
program, also a cooperative agreement) will then be prepared.
The Value Pricing Pilot Program Application
As stated under the DATES section in this notice, in order to be
assured of the maximum amount of constructive assistance from FHWA in
preparing a formal application, Expressions of Interest for tolling and
pricing projects seeking VPP program funding must be submitted two
months prior to the application deadline that applies to the fiscal
year for which funds are being sought. Once the Tolling and Pricing
Team provides feedback on the Expression of Interest submittal, and
once the public authority has confirmed its course of action is to
pursue VPP program approval, the formal application should be submitted
directly through the State Department of Transportation to the
appropriate FHWA Division Administrator, with a copy sent concurrently
to Mr. Patrick DeCorla-Souza, FHWA's Highway Pricing and System
Analysis Team Leader, c/o the Office of Policy and Governmental
Affairs, 400 Seventh Street, SW., Washington, DC 20590, or via e-mail
at mailto:patrick.decorla-souza@fhwa.dot.gov.
Formal VPP program applications (i.e., step 2) will be
reviewed by a Federal Interagency Review Group,\1\ which provides
support to the FHWA in evaluating program applications (see the ``VPP
Program Application Review Process'' section below). Ideally, the
refined formal application will include:
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\1\ The Federal Interagency Review Group was 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
the Tolling and Pricing Team, along with representatives of the
Federal Transit Administration, the U.S. Environmental Protection
Agency, and the U.S. Department of Energy.
---------------------------------------------------------------------------
1. A description of the congestion problem being addressed (current
and projected);
2. A description of the proposed pricing program and its goals,
including description of facilities included, and, for implementation
projects, expected pricing schedules, technology to be used,
enforcement programs, and operating details;
3. Preliminary estimates of the social and economic effects of the
pricing program, including potential equity impacts, and a plan or
methodology for further refining these estimates for all
[[Page 976]]
pricing project(s) included in the program;
4. The role of alternative transportation modes in the project, and
anticipated enhancements proposed to be included in the pricing
program;
5. A time line for the pre-implementation study and implementation
phases of the project (applications indicating early implementation of
pricing projects that will allow evaluation during the life of SAFETEA-
LU will receive priority);
6. A description of tasks to be carried out as part of each phase
of the project, and an estimate of costs associated with each;
7. Plans for monitoring and evaluating value pricing implementation
projects, including plans for data collection and analysis, before and
after assessment, and long term monitoring and documenting of project
effects;
8. A detailed finance and revenue plan, including (for
implementation projects) a budget for capital and operating costs; a
description of all funding sources, planned expenditures, proposed uses
of revenues, and a plan for projects to become financially self-
sustaining (without Federal support) within three years of
implementation.
9. Plans for involving key affected parties, coalition building,
media relations, and related matters, including either demonstration of
previous public involvement in the development of the proposed pricing
program or plans to ensure adequate public involvement prior to
implementation;
10. Plans for meeting all Federal, State and local legal and
administrative requirements for project implementation, including
relevant Federal-aid planning and environmental requirements. Priority
will be given to applications where projects are included as a part of
(or are consistent with) a broad program addressing congestion,
mobility, air quality and energy conservation, where an area has
congestion management systems (CMS) for Transportation Management Areas
(urbanized areas with over 200,000 population or those designated by
the Secretary).
11. An explanation about how ETC project components will be
compatible with other ETC systems in the region.
If some of these items are not available or fully developed at the
time the formal application is submitted, applications will still be
considered for support if they meet some of the priority interests of
the FHWA, and related project characteristics, as described earlier in
the section entitled ``Potential Project Types,'' and if there is a
strong indication that these items will be completed within a short
time.
VPP Program Application Review Process
A. Requests for Funding
After completion of an Expression of Interest, and upon subsequent
receipt of the formal, refined application, the FHWA's Office of Policy
and Governmental Affairs will engage the Federal Interagency Review
Group and proceed with final evaluation.
To ensure that all projects receive equal and fair consideration
for the limited available funds, the FHWA requires formal grant
applications to be submitted no later than March 31, 2006, for FY 2006
funds, October 1, 2006, for FY 2007 funds, and each subsequent October
1 for funding through and including FY 2009. To be assured of the
maximum amount of constructive assistance from FHWA in preparing a
formal application, Expressions of Interest must be submitted by
January 31, 2006, for FY 2006 funds, August 1, 2006, for FY2007 funds,
and each subsequent August 1 thereafter. This timeline will allow for a
fair comparison among formal applications received and will also allow
the FHWA to make timely recommendations to the Secretary with regard to
allocation of available funds in accordance with the criteria discussed
in this notice. Based on the recommendations of the Federal Interagency
Review Group, the U.S. DOT will identify those VPP program applications
that have the greatest potential for promoting the objectives of the
VPP program, including demonstrating the effects of value pricing on
congestion, driver behavior, traffic volume, ridesharing, transit
ridership, air quality, and availability of funds for transportation
programs. The Secretary will make selections of applications based on
the recommendations of the Federal Interagency Review Group and
criteria contained in this notice.
B. Projects for Which No Funds Are Requested
Although most projects under the VPP program involve requests for
value pricing funds, some projects do not. In such cases, and
especially where a State is not already part of the VPP program, the
FHWA recommends that the public authority investigate the other
opportunities to gain authority to toll that are listed in the
companion notice in today's Federal Register, entitled ``Safe,
Accountable, Flexible, Efficient Transportation Equity Act: A Legacy
for Users (SAFETEA-LU); Opportunities for State and Other Qualifying
Agencies to Gain Authority to Toll Facilities Constructed Using Federal
Funds.''
Cooperative Agreement
The VPP program candidates approved for funding will be invited to
enter into negotiations with the FHWA to develop a cooperative
agreement under which the scope of work for the value pricing project
will be defined. Federal statutes will govern the cooperative
agreement. Regulations cited in the agreement, and 49 CFR part 18,
Uniform Administrative Requirements for Grants and Cooperative
Agreements to State and Local Governments, will also govern as they
relate to the acceptance and use of Federal funds for this program. As
a practical matter, each VPP program project should have a separate
cooperative agreement. Although, in the past, the FHWA has allowed some
States to have a master cooperative agreement that is subsequently
amended for each approved project, in the future the FHWA will execute
a separate agreement for each project. For value pricing projects that
do not involve requests for Federal funds, a cooperative agreement must
still be executed. The FHWA Division Administrator will sign the
cooperative agreement on behalf of FHWA.
Other Requirements
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 (23 U.S.C. 135 (c)(1),
(e)(2)(B), (f)(1)(B)(ii)(I) and (II), (f)(3)(A) and (B); 49 U.S.C.
5323(1)).
Implementation projects involving tolls 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 involving tolls 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
[[Page 977]]
implementation plan); (c) selected in accordance with the requirements
in Section 1203(h)(5) or (i)(2) of TEA-21; and (d) consistent with any
existing congestion management system in Transportation Management
areas, developed pursuant to 23 U.S.C. 134(i)(3).
Frequently Asked Questions
1. Who will make up the Tolling and Pricing Team? The Office of
Operations is the lead office and will undertake responsibility to
gather and distribute the Expressions of Interest for preliminary
evaluation and to maintain the aforementioned website. The Tolling and
Pricing Team has representation from all of the relevant program
offices that have tolling and pricing oversight responsibilities,
including the FHWA Offices of Operations, Policy and Governmental
Affairs, and Infrastructure. In addition, other stakeholder offices
within FHWA and the U.S. Department of Transportation are represented,
including the FHWA Offices of Public Affairs and Chief Counsel, and the
Office of the Secretary of Transportation.
2. How often will the Tolling and Pricing Team meet? The group will
meet as often as necessary in person, but mostly will communicate via
e-mail contact and access to a File Transfer Protocol (FTP) Web site,
which will serve to post the Expressions of Interest for private review
by the team almost immediately upon submittal. The Office of Operations
will act promptly to engage the Tolling and Pricing Team to review a
project proposal, discuss project eligibility under different programs,
and recommend the project for further consideration under the most
appropriate program.
3. If I have any questions, whom should I contact? Any general
questions concerning the tolling and pricing programs should be
directed to Mr. Wayne Berman, Transportation Specialist, in the Office
of Operations at 202-366-4069. His e-mail address is
wayne.berman@fhwa.dot.gov. Alternatively, there is an e-mail
``mailbox'' on the tolling and pricing Web site (address below). At the
time of this notice, the direct points of contact are:
a. Web site: http://www.ops.fhwa.dot.gov/tolling_pricing/index.htm
b. Tolling and Pricing Team--Wayne Berman, HOP. (202) 366-4069; wayne.berman@fhwa.dot.gov.
c. Value Pricing (SAFETEA-LU 1604(a))--Patrick DeCorla-Souza. (202)
366-4076; patrick.decorla-souza@fhwa.dot.gov.
d. HOV to HOT lane (1121)--Jessie Yung. (202) 366-4672;
jessie.yung@fhwa.dot.gov.
e. Express Lanes Demonstration (SAFETEA-LU 1604(b))--Wayne Berman
(contact info above).
f. Interstate System Construction (SAFETEA-LU 1604(c))--Greg Wolf.
(202) 366-4655; greg.wolf@fhwa.dot.gov.
g. Interstate Reconstruction and Rehabilitation (TEA-21 1216(b))--
Greg Wolf (contact info above).
h. 23 U.S.C. 129 Agreements--Greg Wolf (contact info above).
Authority 23 U.S.C. 315; sec. 1216(a), Pub. L. 105-178, 112
Stat. 107; Pub. L. 109-59; 117 Stat. 1144 49 CFR 1.48.
Issued on: December 28, 2005.
J. Richard Capka,
Acting Federal Highway Administrator.
[FR Doc. E6-12 Filed 1-5-06; 8:45 am]
BILLING CODE 4910-22-P