Temporary Local Match Waiver; Removal

DEPARTMENT OF TRANSPORTATION

Federal Transit Administration

49 CFR Part 671

[Docket 93-A]

RIN 2132-AA49

Temporary Local Match Waiver; Removal

AGENCY: Federal Transit Administration, DOT.

ACTION: Final Rule.

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SUMMARY: Because the supporting statutory authority has expired, the

Federal Transit Administration (FTA) is removing the Temporary Local

Match Waiver for sections 9 and 18 from the Code of Federal

Regulations. FTA made this determination as part of the President's

``reinventing government'' initiative.

EFFECTIVE DATE: March 11, 1996.

FOR FURTHER INFORMATION CONTACT: Nancy Zaczek, Attorney-Advisor, Office

of the Chief Counsel, (202) 366-4011.

SUPPLEMENTARY INFORMATION:

Introduction

On August 11, 1993, FTA published an Interim Final Rule announcing

a temporary change in how it finances capital projects for certain FTA-

funded programs, specifically allowing for a ``waiver'' of the local

match requirements under two FTA-funded programs. 58 FR 42690. The

underlying statutory authority for that policy change has expired, thus

prompting FTA to remove 49 CFR 671 from the Code of Federal

Regulations. The Federal Highway Administration (FHWA) published a

final rule on February 2, 1993 at 58 FR 6713, subsequently codified at

23 CFR 140, waiving the State matching requirements to fund certain

kinds of construction projects under the Federal-aid highway program.

Because FTA and FHWA were authorized by the same statute to waive the

local or State matching requirements, FTA and FHWA adopted similar

approaches to implementing the temporary waiver program.

The Temporary Waiver Program

As explained in the interim final rule, under section 9 of the

Federal Transit Act, as amended (FT Act) now codified at 49 U.S.C.

Sec. 5336 and called ``urbanized area formula program,'' and under

section 18 of the FT Act, now codified at 49 U.S.C. Sec. 5311 and

called ``non-urbanized area formula program,'' FTA and a recipient of

its funds share the costs of financing local mass transit capital

projects. Specifically, FTA pays eighty percent of a capital project's

eligible costs (the Federal share), and a recipient pays the remaining

twenty percent (the local match or local share). To ensure the

sufficiency of local financing for a project, 49 U.S.C. Sec. 5307

requires a recipient to certify that it can pay its share of the

project's cost. A similar requirement applies to grants made under

FTA's ``non-urbanized area formula program.''

During fiscal years 1992 and 1993, however, an alternative approach

to these Federal and local share requirements was available.

Specifically, the Dire Emergency Supplemental Appropriations Act, 1992,

P.L. 102-302, and the Department of Transportation Appropriations Act,

1993, P.L. 102-388, (the Acts) permitted FTA, under limited

circumstances, to waive in fiscal years 1992 and 1993 part or all of

the local share required for capital projects under 49 U.S.C.

Secs. 5311 and 5336, thereby increasing the proportion of Federal money

used to pay for a project, which Part 671 called the ``increased

Federal share.'' In short, in fiscal years 1992 and 1993 a recipient

could have funded a project's costs using only Federal money.

The rule specified the circumstances under which FTA would grant a

waiver, described the application process, and detailed procedures for

the repayment of the ``increased Federal share.'' The waiver applied

only to funds obligated by FTA and drawn down by the recipient before

October 1, 1993.

Analysis of the Comment

FTA received only one comment to the interim final rule. That

comment, from a State Department of Transportation (DOT), raised

concerns about how the ``increased Federal share'' would be repaid by a

recipient. The ``increased Federal share'' equals the amount of the

local share waived by FTA.

The rule specified that recipients must repay the ``increased

Federal share'' before March 31, 1994. Should a recipient fail to meet

this deadline, the rule provided that FTA would deduct fifty percent of

the amount waived in fiscal year 1995 and fifty percent in fiscal year

1996 from the recipient's apportionment. If, however, the funds were

transferred from the Surface Transportation Program or the Congestion

Mitigation and Air Quality program to formula programs for urbanized or

non-urbanized areas and the recipient did not repay those funds before

March 31, 1994, the Federal Highway Administration (FHWA) would deduct

fifty percent of the amount waived from the originating apportionment

under the appropriate highway program in FY 1995 and the remaining

portion in FY 1996.

The State DOT objected to the latter alternative and recommended

that State DOTs be given a formal role in approving any waiver

requested by a recipient, and that any waiver of the local share for a

transit project be repaid from a recipient's transit apportionment

regardless of the original source of the funding.

This State DOT was the only commenter who raised this particular

concern and therefore FTA concluded that virtually all FTA recipients

and State DOTs did not see this particular repayment provision as

burdensome or objectionable. Moreover, the Acts did not give State DOTs

a role in approving waiver requests. Consequently, FTA did not change

this particular provision.

[[Page 9651]]

Regulatory Analysis

This is not a significant rule under Executive Order 12866 or under

the Department's Regulatory Policies and Procedures. It does not impose

costs on regulated parties; it merely removes a Part that has become

obsolete and whose underlying statutory authority has lapsed. There are

not sufficient Federalism implications to warrant the preparation of a

Federalism Assessment. The Department certifies that this rule will not

have a significant economic impact on a substantial number of small

entities.

List of Subjects in 49 CFR Part 671

Grant programs-transportation, Mass Transportation.

Accordingly, for the reasons set forth above, and under the

Authority 49 U.S.C. 5334 (b)(2), part 671 is hereby removed.

Issued: March 5, 1996.

Gordon J. Linton,

Administrator.

[FR Doc. 96-5670 Filed 3-8-96; 8:45 am]

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