Emergency Relief (ER) Program$500,000 Disaster Eligibility Threshold

DEPARTMENT OF TRANSPORTATION

Federal Highway Administration

23 CFR Part 668

[FHWA Docket No. FHWA 97-3105]

RIN 2125-AE27

Emergency Relief (ER) Program--$500,000 Disaster Eligibility

Threshold

AGENCY: Federal Highway Administration (FHWA), DOT.

ACTION: Advance notice of proposed rulemaking (ANPRM); request for

comments.

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SUMMARY: The FHWA is initiating this rulemaking to evaluate the need to

revise the FHWA's regulation (23 CFR 668.105(j)) that now provides for

a $500,000 threshold to distinguish between heavy maintenance or

routine emergency repair and serious damage. This threshold is used as

one of the criteria to qualify a disaster under the FHWA's Emergency

Relief (ER) program for repair of Federal-aid highways. The FHWA is

publishing this ANPRM to generate discussion and comments on the

appropriateness of the current threshold value as well as any

additional options/concepts regarding establishment of a disaster

eligibility threshold. Once information from this ANPRM has been

reviewed, if appropriate, specific proposals for revision of the

threshold will be published in the Federal Register as a Notice of

Proposed Rulemaking (NPRM).

DATES: Comments must be received on or before April 20, 1998.

ADDRESSES: Signed, written comments should refer to the docket number

that appears at the top of this document and must be submitted to the

Docket Clerk, U.S. DOT Dockets, Room PL 401, 400 Seventh Street, SW.,

Washington, D.C. 20590-0001. All comments received will be available

for examination at the above address between 10:00 a.m. and 5:00 p.m.,

e.t., Monday through Friday, except Federal holidays. Those desiring

notification of receipt of comments must include a self-addressed,

stamped envelope or postcard.

FOR FURTHER INFORMATION CONTACT: Mohan P. Pillay, Office of

Engineering, 202-366-4655, or Wilbert Baccus, Office of the Chief

Counsel, 202-366-0780, FHWA, 400 Seventh Street, SW., Washington, DC

20590. Office hours are from 7:45 a.m. to 4:15 p.m, e.t., Monday

through Friday, except Federal holidays.

SUPPLEMENTARY INFORMATION:

1. Purpose of This Rulemaking

The regulations governing the ER program for repair of Federal-aid

highways (23 CFR 668, subpart A) were revised in 1987 to establish, for

the first time, dollar guidelines for consideration of whether a

disaster would be

[[Page 8378]]

categorized as ``serious `` from the perspective of 23 U.S.C. 125. The

requirement pertaining to dollar guidelines is contained in 23 CFR

668.105(j). It states: ``ER program funding is only to be used to

repair highways which have been seriously damaged and is not intended

to fund heavy maintenance or routine emergency repair activities which

should be normally funded as contingency items in the State and local

road programs. An application for ER funds in the range of $500,000 or

less must be accompanied by a showing as to why the damage repair

involved is considered to be beyond the scope of heavy maintenance or

routine emergency repair. As a general rule, widespread nominal road

damages in this range would not be considered to be of a significant

nature justifying approval by the FHWA Administrator for ER funding.''

For the purposes of this ANPRM, the term disaster referred to

throughout this document means a natural disaster or catastrophic

failure. As indicated in the regulation, the ER program is not intended

to fund heavy maintenance or routine emergency repair activities, which

should be normally funded as contingency items in the State and local

road programs. In essence, the regulation says that if a disaster event

does not require more than $500,000 in ER funding to repair seriously

damaged highways, it falls under the category of heavy maintenance and,

therefore, normally does not qualify under the FHWA ER program for

funding. In exceptional circumstances, such as in the case of

Territories and in States with limited highway funding resources, a

disaster with damage in the range of $500,000 or less may be considered

eligible for ER funding.

The FHWA is considering modification of the $500,000 threshold for

the following reasons:

(1) The current $500,000 threshold, established 10 years ago, needs

to be routinely reviewed for appropriateness.

(2) Several FHWA field offices have indicated that the $500,000

threshold is too low, considering the overall highway program size in

some States.

(3) The number of disasters per year has increased considerably in

the recent past, and as a result, there is a higher demand for ER

funds, thus placing more financial burden on the already strapped ER

program.

The FHWA believes that setting up a higher threshold may eliminate

funding less ``serious'' disasters which would currently be eligible

for ER funding. For example, 47 disasters were funded in FY 1996.

Nearly 20 percent of the funded disasters had an initial estimate under

$1,000,000. Elevating the disaster threshold to $1,000,000, thus, could

have eliminated nearly 20 percent of the funded disasters in FY 1996

from emergency relief funding, representing nearly $5.2 million in

damage. This $5.2 million, in turn, would have been available for

disasters which individually resulted in more than $1,000,000 in

damage.

The FHWA is initiating this rulemaking process to generate

discussion and proposals for revising the current regulation pertaining

to the $500,000 threshold.

2. Rulemaking Process

This document is first in a series of actions to address the issue

of the $500,000 threshold established to distinguish heavy maintenance

from ``serious'' damage. Based upon the comments to this ANPRM, the

FHWA will consider formulating specific proposals and publishing a

NPRM. The NPRM would also provide a comment period for additional

public response to specific proposals. The FHWA now anticipates that a

final rule may be developed and published in 1998. The following

options are provided with the intent to generate discussion and

comments which may help in formulating specific proposals for the NPRM.

Additional options and concepts are welcome.

Option 1--Continue to have a single threshold applied to all

States, but increase the threshold.

Under this option, the existing threshold would be increased to a

higher value--for example, $1,000,000. The advantages are:

(1) The program would better serve as intended--to fund unusually

heavy expenses of repairing ``serious'' damage from natural disasters

or catastrophic failures, and to eliminate funding low-cost disasters;

(2) The overall cost to the ER program would be reduced, as those

disasters with an initial estimate under $1,000,000 normally would not

qualify for funding; and

(3) The administrative costs at all levels would be reduced as time

involved in disaster surveys, documentation, and processing would be

reduced.

A disadvantage is that a higher threshold would place a greater

funding burden on the States with smaller highway programs. They may be

adversely affected as resources may not be readily available to respond

to disasters under the minimum $1,000,000 disaster eligibility

threshold. Additionally, the application of the same threshold value to

all States would be administratively simple; however, it does not

equitably reflect the financial impact of a disaster based on the size

of a State's program.

Option 2--Formulate more than one minimum disaster eligibility

threshold, using a tiered approach based on the size of a State's

highway program.

Under this option the States would be grouped into tiers based on

the size of their Federal-aid program--i.e, Federal-aid apportionments

received in the prior fiscal year. A minimum disaster eligibility

threshold would be formulated for each tier beginning from a base

threshold. This concept is illustrated using a three tier approach in

the following example:

Tier 1 would be those States that received Federal-aid highway

apportionments under $100 million for the previous fiscal year. Tier 1

States would be subject to a minimum threshold of $500,000;

Tier 2 would be those States that received Federal-aid highway

apportionments of at least $100 million and not exceeding $500 million

for the previous fiscal year. Tier 2 States would use a minimum

threshold of $1,000,000; and

Tier 3 would be those States which received Federal-aid highway

apportionments over $500 million for the previous fiscal year. Tier 3

States would use a minimum threshold of $2,000,000.

Based on the FY 1997 Federal-aid highway apportionments, the number

of States including the District of Columbia and Puerto Rico, in each

tier in the above illustration would be as follows: Tier 1 States--7;

Tier 2 States--33; and Tier 3 States--12. Other scenarios, as

appropriate may be developed.

The advantages are:

(1) This approach would not place a disproportionate burden on

States with smaller highway programs; rather it treats States more or

less in an equitable fashion;

(2) The program would better serve as intended--to fund unusually

heavy expenses of repairing ``serious'' damage from natural disasters

or catastrophic failures. New higher thresholds on disaster eligibility

would eliminate funding low-cost disasters for States with larger

programs;

(3) The overall cost to the ER program would be reduced as certain

disasters might not meet the new disaster eligibility thresholds and

therefore might not qualify for funding; and

(4) The administrative costs would be reduced at all levels, as

time involved

[[Page 8379]]

in disaster surveys, documentation, and processing would be reduced.

The disadvantages are:

(1) States with larger highway programs could lose some ER funding

as the higher disaster eligibility threshold in these States might

eliminate some disasters which would have qualified for funding under

the current threshold; and

(2) The FHWA would be required to track States with different

disaster eligibility thresholds, resulting in more review time and

paperwork.

Commenters are invited to present their views on the options

discussed above. In addition, the FHWA welcomes other suggestions

concerning the current dollar threshold and appropriate methods to

update this threshold.

Rulemaking Analyses and Notices

Executive Order 12866 (Regulatory Planning and Review) and DOT

Regulatory Policies and Procedures

The FHWA has determined preliminarily that any action taken

regarding the disaster eligibility threshold will not be a significant

regulatory action within the meaning of Executive Order 12866 or

significant within the meaning of the Department of Transportation's

regulatory policies and procedures. It is anticipated that the economic

impact of any action taken in this rulemaking will be minimal. Any

changes are not anticipated to adversely affect, in a material way, any

sector of the economy. In addition, any changes are not likely to

interfere with any action taken or planned by another agency or

materially alter the budgetary impact of any entitlement, grants, user

fees, or loan programs.

The FHWA emphasizes, however, that this document is published to

generate discussion and comments which may be used in formulating

specific proposals for the revision of a section of the current

regulation dealing with disaster eligibility determinations for ER

funding. It is not anticipated that these changes will affect the total

Federal funding available under the ER program. Consequently, a full

regulatory evaluation is not required. In any event, we strongly

encourage and will actively consider comments on this matter, as well

as other issues relating to the projected impact of actions

contemplated in this ANPRM.

Regulatory Flexibility Act

In compliance with the Regulatory Flexibility Act (5 U.S.C. 601-

612), the FHWA will evaluate the effects of any action proposed on

small entities. This ANPRM will only generate comments and discussions

on one of the disaster eligibility criteria used for providing

emergency relief assistance to States in accordance with the existing

laws, regulations and guidance. Thus, it would be premature to assess

the economic impact of any action that might be contemplated. Because

the States are not included in the definition of ``small entity'' set

forth in 5 U.S.C. 601, we do not anticipate that any adjustment to the

disaster eligibility threshold that might be considered would have a

substantial economic impact on small entities within the meaning of the

Regulatory Flexibility Act. We encourage commenters to evaluate any

options addressed here with regard to their potential for impact,

however, and to formulate their comments accordingly.

Executive Order 12612 (Federalism Assessment)

Any action that might be proposed in subsequent stages of this

proceeding will be analyzed in accordance with the principles and

criteria contained in Executive Order 12612. Given the nature of the

issues involved in this proceeding, the FHWA anticipates that any

action contemplated will not have sufficient federalism implications to

warrant the preparation of a federalism assessment. Nor does the FHWA

anticipate that any action taken would preempt any State law or State

regulation or affect the States' ability to discharge traditional State

governmental functions. We encourage commenters to consider these

issues, however, as well as matters concerning any costs or burdens

that might be imposed on the States as a result of actions considered

here.

Executive Order 12372 (Intergovernmental Review)

Catalog of Federal Domestic Assistance Program Number 20.205,

Highway Planning and Construction. The regulations implementing

Executive Order 12372 regarding intergovernmental consultation on

Federal programs and activities apply to this program.

Paperwork Reduction Act

Any action that might be contemplated in subsequent phases of this

proceeding is not likely to involve a collection of information

requirement for the purposes of the Paperwork Reduction Act of 1995, 44

U.S.C. 3501-3500, or information collection requirements not already

approved for the ER program. The FHWA, however, will evaluate any

actions that might be considered in accordance with the terms of the

Paperwork Reduction Act.

National Environmental Policy Act

The agency also will analyze any action that might be proposed for

the purpose of the National Environmental Policy Act of 1969 (42 U.S.C.

4321-4347) to assess whether there would be any effect on the quality

of the environment.

Regulation Identification Number

A regulation identification number (RIN) is assigned to each

regulatory action listed in the Unified Agenda of Federal Regulations.

The Regulatory Information Service Center publishes the Unified Agenda

in April and October of each year. The RIN number contained in the

heading of this document can be used to cross reference this action

with the Unified Agenda.

List of Subjects in 23 CFR Part 668

Emergency relief program, Grant programs-transportation, Highways

and roads.

Authority: 23 U.S.C. 315; 23 U.S.C. 101; 23 U.S.C. 120(e); 23

U.S.C. 125; 49 CFR 1.48(6).

Issued on: February 11, 1998.

Kenneth R. Wykle,

Administrator, Federal Highway Administration.

[FR Doc. 98-4172 Filed 2-18-98; 8:45 am]

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