Federal-Aid Highways
Federal Requirements for Highways May Influence Funding Decisions and Create Challenges, but Benefits and Costs Are Not Tracked Gao ID: GAO-09-36 December 12, 2008As highway congestion continues to be a problem in many areas, states are looking to construct or expand highway projects. When a state department of transportation (DOT) receives federal funding for highway projects from the Federal Highway Administration (FHWA), the projects must comply with the National Environmental Policy Act (NEPA), the Davis-Bacon prevailing wage requirement, the Disadvantaged Business Enterprise (DBE) program, and the Buy America program. While complying with these requirements, states must use limited transportation dollars efficiently. As requested, GAO addressed (1) the types of benefits and costs associated with these requirements for federal-aid highway projects; (2) the influence of these federal requirements on states' decisions to use nonfederal or federal funds for highway projects; and (3) the challenges associated with the federal requirements and strategies used or proposed to address the challenges. To complete this work, GAO reviewed 30 studies, surveyed DOTs in all states and the District of Columbia, and interviewed transportation officials and other stakeholders.
Several of the studies GAO reviewed describe the benefits of environmental requirements for highway projects, such as better protection for wetlands, but none attempted to quantify these benefits. Some studies quantified certain types of environmental costs, such as costs for administering NEPA. In general, however, quantitative information on environmental benefits and costs is limited because states do not generally track such information. Several studies attempted to quantify the benefits and costs of the Davis-Bacon prevailing wage requirement; however, these studies did not focus on transportation projects specifically. Furthermore, while the studies reviewed did not identify the benefits of the DBE program, transportation officials identified some benefits of the program, such as providing greater opportunities for DBE firms. One study we reviewed identified the benefits of the Buy America program, including protecting against unfair competition from foreign firms. The studies reviewed also identified, and in some cases quantified, the costs of the DBE and Buy America programs, including administrative costs and the use of higher priced iron and steel in projects. Of the 51 state DOTs GAO surveyed, 39 reported that, in the past 10 years, federal requirements had influenced their decision to use nonfederal funds for highway projects that were eligible for federal aid. Thirty-three of these state DOTs reported that NEPA factored into their decision to use nonfederal funds, while the other three requirements GAO reviewed were a factor only in a few states. State officials said that they use nonfederal funds for certain projects to avoid project delays or costs associated with the federal requirements or because of other factors, such as requirements imposed by a state legislature. A state's funding decision may depend on whether the state has requirements similar to these federal requirements. The decision may also take into consideration the availability of nonfederal and federal funds. For example, officials from one state said that they have limited nonfederal funds available, and as a result, like other states GAO interviewed, rely on the federal funds to finance their highway projects. According to transportation officials and contractors, administrative tasks associated with the federal requirements pose challenges. For example, analyzing impacts and demonstrating compliance with NEPA requires extensive paperwork and documentation. State officials also said that coordinating with multiple government agencies on environmental reviews is challenging, in part because these agencies may have competing interests. Furthermore, according to state DOTs, some provisions of the federal requirements may be outdated. For example, the $2,500 regulatory cost threshold for compliance with the Buy America program for purchasing domestic steel and $750,000 regulatory personal net worth ceiling of the DBE program have not been updated since 1983 and 1999, respectively. All of these challenges may cause delays and increase project costs. Some government agencies have implemented strategies to address these challenges and these strategies have had varied success in decreasing project costs and delays.
RecommendationsOur recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
Director: Team: Phone:GAO-09-36, Federal-Aid Highways: Federal Requirements for Highways May Influence Funding Decisions and Create Challenges, but Benefits and Costs Are Not Tracked
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Report to Congressional Requesters:
United States Government Accountability Office:
GAO:
December 2008:
Federal-Aid Highways:
Federal Requirements for Highways May Influence Funding Decisions and
Create Challenges, but Benefits and Costs Are Not Tracked:
GAO-09-36:
GAO Highlights:
Highlights of GAO-09-36, a report to congressional requesters.
Why GAO Did This Study:
As highway congestion continues to be a problem in many areas, states
are looking to construct or expand highway projects. When a state
department of transportation (DOT) receives federal funding for highway
projects from the Federal Highway Administration (FHWA), the projects
must comply with the National Environmental Policy Act (NEPA), the
Davis-Bacon prevailing wage requirement, the Disadvantaged Business
Enterprise (DBE) program, and the Buy America program. While complying
with these requirements, states must use limited transportation dollars
efficiently. As requested, GAO addressed (1) the types of benefits and
costs associated with these requirements for federal-aid highway
projects; (2) the influence of these federal requirements on states‘
decisions to use nonfederal or federal funds for highway projects; and
(3) the challenges associated with the federal requirements and
strategies used or proposed to address the challenges. To complete this
work, GAO reviewed 30 studies, surveyed DOTs in all states and the
District of Columbia, and interviewed transportation officials and
other stakeholders.
What GAO Found:
Several of the studies GAO reviewed describe the benefits of
environmental requirements for highway projects, such as better
protection for wetlands, but none attempted to quantify these benefits.
Some studies quantified certain types of environmental costs, such as
costs for administering NEPA. In general, however, quantitative
information on environmental benefits and costs is limited because
states do not generally track such information. Several studies
attempted to quantify the benefits and costs of the Davis-Bacon
prevailing wage requirement; however, these studies did not focus on
transportation projects specifically. Furthermore, while the studies
reviewed did not identify the benefits of the DBE program,
transportation officials identified some benefits of the program, such
as providing greater opportunities for DBE firms. One study we reviewed
identified the benefits of the Buy America program, including
protecting against unfair competition from foreign firms. The studies
reviewed also identified, and in some cases quantified, the costs of
the DBE and Buy America programs, including administrative costs and
the use of higher priced iron and steel in projects.
Of the 51 state DOTs GAO surveyed, 39 reported that, in the past 10
years, federal requirements had influenced their decision to use
nonfederal funds for highway projects that were eligible for federal
aid. Thirty-three of these state DOTs reported that NEPA factored into
their decision to use nonfederal funds, while the other three
requirements GAO reviewed were a factor only in a few states. State
officials said that they use nonfederal funds for certain projects to
avoid project delays or costs associated with the federal requirements
or because of other factors, such as requirements imposed by a state
legislature. A state‘s funding decision may depend on whether the state
has requirements similar to these federal requirements. The decision
may also take into consideration the availability of nonfederal and
federal funds. For example, officials from one state said that they
have limited nonfederal funds available, and as a result, like other
states GAO interviewed, rely on the federal funds to finance their
highway projects.
According to transportation officials and contractors, administrative
tasks associated with the federal requirements pose challenges.
For example, analyzing impacts and demonstrating compliance with NEPA
requires extensive paperwork and documentation. State officials also
said that coordinating with multiple government agencies on
environmental reviews is challenging, in part because these agencies
may have competing interests. Furthermore, according to state DOTs,
some provisions of the federal requirements may be outdated. For
example, the $2,500 regulatory cost threshold for compliance with the
Buy America program for purchasing domestic steel and $750,000
regulatory personal net worth ceiling of the DBE program have not been
updated since 1983 and 1999, respectively. All of these challenges may
cause delays and increase project costs. Some government agencies have
implemented strategies to address these challenges and these strategies
have had varied success in decreasing project costs and delays.
What GAO Recommends:
The Department of Transportation should re-evaluate the Buy America
threshold and the DBE personal net worth ceiling, and modify them, if
necessary. The Department of Transportation provided technical comments
on the report, but took no position on the recommendation.
To view the full product, including the scope and methodology, click on
[hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-09-36]. For more
information, contact David J. Wise at (202) 512-2834 or wised@gao.gov.
[End of section]
Contents:
Letter:
Results in Brief:
Background:
Several Types of Benefits and Costs Are Associated with Federal
Requirements for Highway Projects, but Quantitative Estimates Are
Limited:
Federal Requirements, among Other Factors, Influence State Funding
Decisions:
Government Agencies and Contractors Face Challenges Associated with
Federal Requirements, and Some Are Using Strategies to Address These
Challenges:
Conclusions:
Recommendations for Executive Action:
Agency Comments and Our Evaluation:
Appendix I: Objectives, Scope, and Methodology:
Appendix II: GAO Survey of State Departments of Transportation:
Appendix III: Strategies Used or Proposed by Federal and State Agencies
to Address Challenges Associated with Federal Requirements:
Appendix IV: GAO Contact and Staff Acknowledgments:
Figures:
Figure 1: Typical Amount of Time Involved in Planning, Approving, and
Building a Major New Highway Project:
Figure 2: Percentage of States Using Nonfederal Funds for Highway
Projects because of the Federal Requirements, and the Requirements that
Factored into States' Decisions:
Figure 3: Median Times, in Months, Taken to Complete an Environmental
Impact Statement (EIS) or an Environmental Assessment (EA) for Federal-
Aid Highway Projects, Fiscal Years 2003 to 2008:
Abbreviations:
AASHTO: American Association of State Highway and Transportation
Officials:
ACHP: Advisory Council on Historic Preservation:
DBE: Disadvantaged Business Enterprise:
DOL: Department of Labor:
DOT: Department of Transportation:
EA: environmental assessment:
EDTS: Environmental Document Tracking System:
EIS: environmental impact statement:
Environment VFG: Vital Few Environmental Streamlining and Stewardship
Goal:
EPA: Environmental Protection Agency:
ETDM: Efficient Transportation Decision Making:
FHWA: Federal Highway Administration:
ICC: Inter-County Connector:
MPO: metropolitan planning organization:
NCHRP: National Cooperative Highway Research Program:
NEPA: National Environmental Policy Act:
NPDES: National Pollutant Discharge Elimination System:
SAFETEA-LU: Safe, Accountable, Flexible, Efficient, Transportation
Equity Act: A Legacy for Users:
SBA: Small Business Administration:
SHPO: State Historic Preservation Office:
SHRP2: Strategic Highway Research Program 2:
USACE: U.S. Army Corps of Engineers:
[End of section]
United States Government Accountability Office:
Washington, DC 20548:
December 12, 2008:
The Honorable Tom Davis:
Ranking Member:
Committee on Oversight and Government Reform:
House of Representatives:
The Honorable Bill Sali:
House of Representatives:
The nation's highways are critical not only to mobility--the free flow
of passengers and goods through the transportation system--but also to
sustaining America's economic growth. The growth of the U.S. economy
will depend, in part, on the soundness and adequacy of the nation's
transportation system. As demand for and congestion of our highways is
increasing, states and localities are proposing highway construction or
expansion projects, yet transportation dollars are limited. Federal,
state, and local governments are facing financing challenges, and the
future of the Highway Trust Fund--which supports highway construction
and maintenance, highway safety, and transit--is uncertain.
Consequently, using limited transportation dollars as efficiently as
possible will be critical.
The United States has about 4 million miles of roads, including 47,000
miles of interstate highways. Most of the nation's roads and highways
are not owned by the federal government but rather by state and local
governments. Since Congress passed the Federal-Aid Road Act in 1916,
the federal government has supported states' investment in highway
construction, and in 1956, Congress established the Highway Trust Fund,
which supports investment in highway construction via a grant-based
cost reimbursement funding strategy. Under this strategy, the federal
government reimburses states for a portion of their highway expenses
after states incur the expenses. Generally, the federal share of
expenses for a federal-aid highway project is 80 percent, while the
state and local share is 20 percent. States rely on federal funding to
construct, rehabilitate, and maintain their highway and road systems.
When a state accepts federal funding for a highway project, it is
subject to several federal requirements. For example, states must
ensure that:
* projects go through an environmental review process, established
under the National Environmental Policy Act (NEPA);
* highway contractors pay their employees at least the Davis-Bacon
prevailing wage, in accordance with 23 U.S.C. § 113;
* minority-and women-owned firms are not discriminated against in the
award and administration of highway projects via the Disadvantaged
Business Enterprise (DBE) program (23 U.S.C. § 140; 23 C.F.R. part 230;
49 C.F.R. part 26); and:
* highway contractors use American-made iron and steel to comply with
the Buy America program, established under 23 U.S.C. § 313.[Footnote 1]
These requirements are intended to protect the environment, enable
highway workers to earn a prevailing wage, assist members of
disadvantaged populations in overcoming the effects of discrimination,
and help the American iron and steel industry compete in the global
economy. Some of these requirements apply to transportation projects,
while others apply generally to any type of construction project that
uses federal funds. While recognizing the value of these requirements,
some state highway officials and highway contractors are concerned that
they may increase project costs by, among other reasons, delaying
projects for environmental reviews or increasing the state's
administrative responsibilities. In addition, the inflation that occurs
during project delays reduces the purchasing power of federal funds
allocated to the states. As a result, according to some state
transportation officials, states have sometimes sought to use
nonfederal funds for projects to avoid the costs or delays involved in
complying with federal requirements.
You asked us to examine issues related to the benefits and costs of the
various requirements that the federal government places on states that
accept federal highway funding. Although many requirements apply to
federally funded highway projects, our review focused on NEPA, the
Davis-Bacon prevailing wage requirement, the DBE program, and the Buy
America program. We selected these requirements on the basis of initial
interviews with federal agency officials and industry experts and
because these requirements are project-specific. This report discusses
(1) the types of benefits and costs associated with these requirements
for federal-aid highway projects; (2) the influence of these federal
requirements on states' decisions to use nonfederal or federal funds
for highway projects; and (3) the challenges associated with the
federal requirements and strategies that federal, state, and local
government agencies and contractors have used or proposed to address
these challenges.
To address these issues, we gathered information from a literature
review, a nationwide survey of state transportation department
officials and structured interviews with some of these officials, case
studies of selected states, and interviews with other industry
stakeholders. Specifically, we reviewed 30 studies that address the
benefits or costs of one or more of the federal requirements addressed
in our review. For each of the studies we identify in this report, we
reviewed its methodology, including the study's datasets, sample size,
and data collection techniques, and concluded that the methodology is
sufficiently reliable; however, we did not independently verify the
results of these studies. We received survey responses from the
departments of transportation (DOT) in all 50 states and the District
of Columbia, which we refer to collectively in this report as state
DOTs, and we conducted follow-up interviews with officials from 10
judgmentally selected state DOTs to obtain additional information on
their survey responses. The survey used for this study is reproduced in
appendix II. We selected the states for interviews on the basis of
their responses to the survey, their funding levels, and geographic
dispersion. We also selected five states (California, Florida, Idaho,
Maryland, and Texas) as case studies based on recommendations from
officials at industry associations, funding levels, and other factors.
[Footnote 2] We visited and conducted interviews with officials in
California, Idaho, Maryland, and Texas, and conducted phone interviews
with officials in Florida. At each state, we interviewed federal,
state, and local government officials; highway contractors; and
metropolitan planning organizations (MPO).[Footnote 3] Finally, we
interviewed officials from the headquarters offices of several federal
agencies and industry groups. See appendix I for more information on
our scope and methodology.
We conducted this performance audit from October 2007 through November
2008 in accordance with generally accepted government auditing
standards. Those standards require that we plan and perform the audit
to obtain sufficient, appropriate evidence to provide a reasonable
basis for our findings and conclusions based on our audit objectives.
We believe that the evidence obtained provides a reasonable basis for
our findings and conclusions based on our audit objectives.
Results in Brief:
According to the studies we identified, the types of benefits
associated with the federal environmental, labor, and construction
requirements for highway projects we reviewed include increased
environmental protection, payment of prevailing wages for skilled
workers, and increased protection for minority firms. These studies
identified the types of costs associated with the federal requirements
as inflation due to project delays, costs due to environmental
mitigation, and administrative costs. However, quantitative estimates
of their value are limited because many of these benefits and costs are
not quantified or tracked. Specifically, several of the studies we
identified describe benefits of the environmental requirements for
highway projects, such as better protection for wetlands, but none
attempted to quantify these benefits. Three studies we reviewed
attempted to quantify some types of costs associated with the
environmental review process, such as costs for administering NEPA.
Quantitative information on environmental benefits and costs is limited
because states have not generally tracked such information.[Footnote 4]
In addition, we found several studies that estimated the impact on
administrative costs due to the Davis-Bacon prevailing wage
requirement, but the studies did not focus on transportation projects
specifically. Furthermore, while the studies we reviewed did not
identify the benefits of the DBE program, transportation officials
identified some benefits of the program, such as providing greater
opportunities for minority-and women-owned firms on federally funded
projects. Separately, one study identified the benefits of the Buy
America program, including protecting against unfair competition from
foreign firms. The studies we reviewed also identified, and in some
cases quantified, the costs of the DBE and Buy America programs. For
example, a 2001 GAO report that attempted to identify the costs of the
DBE program surveyed states to determine the program's costs to each
state in fiscal year 2000, and state responses for administrative costs
ranged from $10,000 to $4.5 million.[Footnote 5] However, state
officials acknowledged that these figures were estimates and that they
did not track other information such as contract costs. We also found
studies that identified the types of costs of the Buy America program,
including the use of higher priced iron and steel in projects and
reduced bidding competition, but no studies that attempted to quantify
the costs of the program. Although the studies we reviewed were, in
some instances, sponsored or authored by organizations or individuals
with a known point of view or interest that could have influenced the
work, we concluded from our review of the studies' methodologies that
the studies were sufficiently reliable for the purposes of our report.
As noted, however, we did not independently verify the results of the
studies.
Transportation officials from most states told us that the federal
requirements we reviewed are among the factors that influence their
decisions to use nonfederal or federal funds for highway projects. More
specifically, 39 of the 51 state DOTs we surveyed reported that, in the
past 10 years, federal requirements had influenced their decision to
use nonfederal funds for highway projects that were eligible for
federal aid. Thirty-three of these 39 state DOTs reported that the NEPA
requirement factored into their decision to use nonfederal funds, while
5 or fewer of the same 39 state DOTs reported that the Davis-Bacon
prevailing wage requirement, the DBE program, or the Buy America
program factored into their decision to use nonfederal funds. State DOT
officials we interviewed told us that they use nonfederal funds instead
of federal funds for certain projects to avoid costs, including delays,
associated with the federal requirements. State officials also told us
other factors can contribute to their decisions to use nonfederal
funds. For example, officials from one state told us that their
legislature passed transportation revenue packages in 2003 and 2005
that required them to use state funding for selected projects.
Nevertheless, even though states may use nonfederal funds for certain
projects to potentially save time or costs, some states told us they
prefer to use federal funds to avoid certain limitations associated
with nonfederal funds or to obtain certain benefits associated with
using federal funds. For example, one limitation associated with using
nonfederal funds is that using these funds and not complying with
federal requirements can preclude states from obtaining federal funds
later. However, states may want to use federal funds for some projects
because, according to some state officials, it can be more efficient
for the state to have the Federal Highway Administration (FHWA)
coordinate the many federal agencies responsible for the various
environmental requirements, rather than have the state use nonfederal
funds and coordinate directly with the federal agencies. In general,
the type of funding a state chooses to use--nonfederal or federal--
varies and depends on the circumstance in the state. For example, 16
states and the District of Columbia have environmental planning and
review requirements similar to NEPA, 32 states and the District of
Columbia have state prevailing wage laws similar to the Davis-Bacon
prevailing wage requirement, and some states also have requirements
similar to the DBE and Buy America programs. These state requirements
may eliminate some advantages in time or costs the states might
otherwise gain by using nonfederal funds. In general, a state's
decision to use nonfederal or federal funds is influenced by the
relative availability of these funds. For example, officials from
Hawaii DOT said that they have limited nonfederal funds available, and
as a result, like other states we interviewed, rely on federal funds to
finance their highway projects.
Federal, state, and local government agencies and contractors face
several specific challenges associated with the federal requirements
that can cause delays and increase project costs. However, many of
these stakeholders have used or have proposed strategies to address
these challenges. According to transportation officials we met with and
interviewed, the challenges are related to administrative tasks and
coordination with multiple government agencies, and to particular
provisions of the federal requirements. For example, among the
administrative challenges, state officials cited a resource-intensive
process associated with NEPA requiring extensive paperwork and
documentation. In addition, state and local transportation officials
said that it is challenging to coordinate multiple government agencies
on environmental review responsibilities because these government
agencies have limited funding and staffing levels, responsibilities and
priorities beyond transportation projects, and may have competing
interests. Our previous work also identified similar challenges and
some strategies that state governments are using to address these
challenges, such as paying for staff at federal and state agencies to
expedite environmental reviews.[Footnote 6] According to state
government officials and contractors we met with, particular provisions
of the federal requirements appear to be outdated, narrowly defined, or
unclearly defined, and these shortcomings make it difficult for them to
implement the requirements and potentially increase project costs and
delays. Specifically, officials from some state DOTs we visited pointed
out that the $2,500 regulatory cost threshold for the Buy America
requirement for purchasing domestic steel has remained unchanged since
the program began in 1983, making more projects subject to Buy America
requirements. Furthermore, some state officials we met with said that
the $750,000 regulatory ceiling on a DBE contractor's personal net
worth was outdated, making it difficult to find contractors who meet
the program's criteria. Some federal and state agencies we spoke with
have used strategies to address these challenges beyond simply using
nonfederal funds, and these strategies have had varying success in
decreasing highway project costs and delays. FHWA's effort to measure
the performance of environmental review processes for highway projects
is one example of these strategies. More specifically, FHWA developed a
performance measure to track the time it takes for projects to complete
the environmental review process so that FHWA and the states can work
to reduce project delays. FHWA has yet to meet its goals for this area.
In light of these findings, we are recommending that the Secretary of
Transportation re-evaluate the $2,500 regulatory threshold for the Buy
America program and the $750,000 regulatory personal net worth ceiling
of the DBE program, and modify them, if necessary, through appropriate
rulemaking. We provided a draft of this report to the U.S. Army Corps
of Engineers (USACE), the Advisory Council on Historic Preservation
(ACHP), the Department of Labor (DOL), U.S. DOT, and the Environmental
Protection Agency (EPA) for their official review and comment. USACE,
ACHP, U.S. DOT, and EPA provided technical comments, which we
incorporated into the final report where appropriate. U.S. DOT took no
position on our recommendation regarding the Buy America program
threshold and DBE personal net worth ceiling. DOL officials notified us
that they had no comments on this report.
Background:
The Highway Trust Fund is a fund supported by taxes highway users pay
on fuel, tires, truck purchases, and the use of heavy vehicles. The
revenue from these taxes supports highway construction and maintenance,
highway safety, and transit. FHWA administers the Federal-Aid Highway
Program and apportions trust fund revenues to state highway departments
or transportation authorities, which oversee the construction of the
individual projects. Once FHWA notifies a state that a particular
highway project has been approved, a state can submit receipts to FHWA
after it has incurred expenses. FHWA approves reimbursements to the
state for its expenses, usually for 80 percent of a project's costs;
the state and local governments are responsible for the other 20
percent. Federal reimbursements from the Highway Trust Fund have risen
from around $15 billion in 1990 to more than $35 billion in 2006, the
last year for which data are available. The federal reimbursements that
states receive vary by state; however, in general, in fiscal year 2006,
the federal government provided about 35 percent of the money that
states and local governments spent on highway projects. While the
federal government provides most funding from the Highway Trust Fund
directly to the states and the states oversee the use of these funds,
by statute, states must provide some trust fund revenues to other
organizations, such as MPOs, for planning purposes.
Federally funded highway projects are typically carried out in four
phases: planning, preliminary design and environmental review, final
design and right-of-way acquisition, and construction. In the planning
phase, state and local highway planners look at transportation
alternatives and work with the public to choose projects that make the
most sense for their areas. According to FHWA, this phase can take up
to 5 years for a major highway project. During the preliminary design
and environmental review phase, states identify engineering issues,
roadway alignment alternatives, transit options, project costs, and
other details. In addition, the proposed project and any alternatives
are examined for potential impacts on the environment, public health,
and welfare. This process can take 1 to 5 years, according to FHWA,
depending on the complexity of the design and possible environmental
considerations that must be considered. During the final design and
right-of-way acquisition phase, states develop detailed engineering
plans consistent with the results of the environmental review phase and
acquire the right-of-way needed to construct the project. This phase
typically takes from 2 to 3 years for a major new highway construction
project, according to FHWA. Finally, during the construction phase, the
state evaluates bids from contractors and then oversees the selected
contractor's construction of the project. The construction of a major
project typically takes, according to FHWA, 2 to 6 years. See figure 1
for a more detailed description of the types of activities and
stakeholders included in the phases of a highway project.
Figure 1: Typical Amount of Time Involved in Planning, Approving, and
Building a Major New Highway Project:
[Refer to PDF for image]
Project phase: Planning;
Potential agencies involved:
* Metropolitan planning organizations;
* State departments of transportation;
* Federal Highway Administration;
* Land management agencies (such as Bureau of Land Management and U.S.
Forest Service);
Typical steps:
* Assess transportation purpose and need• Solicit public comment;
* Gain approval to be included in the state‘s 20-year plan, with
expectation that funds will be available;
* Gain approval to be included in the state‘s short-term plan (at least
3 years) for projects that are to be implemented, with expectation that
funds will be available;
* Secure funding;
Time frame: Length of phase: 4-5 years.
Project phase: Final design and right-of-way acquisition; Project
phase: Preliminary design and environmental review;
Potential agencies involved:
* State departments of transportation;
* State environmental resource agencies;
* State historic preservation office;
* Advisory Council on Historic Preservation;
* Environmental Protection Agency;
* Federal Highway Administration;
* Land management agencies;
* U.S. Army Corps of Engineers;
* U.S. Coast Guard;
* U.S. Fish and Wildlife Service;
Typical steps:
* Consider alignment issues and required lanes;
* Identify alternatives, including not building the project, to
minimize potential harm to the environment and historic sites;
* Select preferred alternative;
* Identify project cost, level of service, and construction location;
* Prepare a preliminary design of the highway;
* Solicit comments on the project and its potential effects from the
public and from local governments;
* Gain concurrence from federal agencies from which environmental and
historic preservation is required;
Time frame: Length of phase: 1-5 years.
Project phase: Final design and right-of-way acquisition;
Potential agencies involved:
* State departments of transportation;
* State environmental resource agencies;
* Environmental Protection Agency;
* Federal Highway Administration;
* Land management agencies;
* U.S. Army Corps of Engineers;
Typical steps:
* Finalize design plans;
* Appraise and acquire property;
* Relocate utilities and affected citizens before construction, if
necessary;
* Finalize project cost estimates;
Time frame: Length of phase: 2-3 years.
Project phase: Construction;
Potential agencies involved:
* State departments of transportation;
* State environmental resource agencies;
* Federal Highway Administration;
* Land management agencies;
Typical steps:
* Advertise and evaluate bids; award contracts;
* Begin construction;
* Resolve unexpected problems;
* Accept delivery;
Time frame: Length of phase: 2-6 years.
9-19 total years from planning to completion.
Note: The duration of the phases is approximate. The preliminary design
and environmental review steps and the final design and right-of-way
acquisition steps often overlap.
[End of figure]
The federal, state, and local governments all have a role in the
construction of federally financed highway projects. However, the state
DOT is the focal point for these activities. It is responsible for
setting a state's transportation goals and for planning safe and
efficient transportation between cities and towns in the state. The
state DOT also designs most projects, acquires right-of-way for highway
construction, and awards contracts to build projects. Local governments
also carry out many transportation planning functions, such as
scheduling improvements and maintenance for local streets and roads. At
the federal level, FHWA is the primary agency involved in
transportation project decision making and oversight. FHWA oversees the
transportation planning and project activities of state DOTs by
approving state transportation plans and certifying that states have
met all legal requirements associated with accepting federal funding.
According to FHWA, over 70 requirements may apply to states that accept
federal funding for highway projects. Some of these requirements are
transportation specific, such as requirements under the DBE program and
the Buy America program, while others, such as NEPA, are general
requirements that can apply to other construction projects, such as
federal building construction. FHWA officials stated that they identify
all requirements that states must meet in the documentation FHWA
provides to states when funding for a project is approved. States in
turn communicate these requirements to potential bidders, so the
contractors know, for example, what wages they must pay or whether they
must buy American-made iron and steel.
The requirements for analyzing the environmental impact of federally
funded highway projects originated in NEPA, enacted in 1969. This
legislation requires agencies to consider and, if possible, avoid or
mitigate potential environmental degradation from federally funded
infrastructure projects before these projects moved forward. FHWA
ensures that federally funded projects go through an environmental
review process, as prescribed in NEPA and its implementing regulations.
FHWA officials stated that under FHWA's NEPA implementation process,
the lead agency must demonstrate that it will implement the project
consistently with several environmental laws. Laws under FHWA's NEPA
"umbrella" include, but are not limited to:
* the Clean Water Act, protecting water quality and ensuring protection
of wetlands;
* the Clean Air Act, protecting air quality;
* the Endangered Species Act, protecting threatened and endangered
species and their habitats;
* Section 138, Title 23 of the U.S. Code, preventing the use of
parkland or recreational areas in the development of highway projects,
except where no feasible and prudent alternative exists; and:
* the National Historic Preservation Act of 1966, identifying historic
properties that may be damaged by the construction of infrastructure
projects, and determining ways to avoid, minimize, or mitigate such
damage.
If no federal funds are used on a project or if a project does not
require federal approval, NEPA is generally inapplicable; however,
these projects still must comply with all applicable federal
environmental laws, which can include the Clean Water and Clean Air
Acts.
While FHWA is generally the lead agency in ensuring that states comply
with NEPA on federally financed highway projects, other federal
agencies have responsibilities under these laws. These agencies
include:
* EPA (air and water quality, wetlands preservation);
* the Fish and Wildlife Service (terrestrial threatened and endangered
species) within the Department of the Interior;
* the National Marine Fisheries Service (marine threatened and
endangered species, effects on fish and spawning grounds) within the
Department of Commerce;
* USACE (effects on U.S. waters, including wetlands); and:
* ACHP (effects on historic properties).
According to FHWA, under the NEPA process, FHWA decides how extensive
an environmental review a federally funded highway project will
undergo. This decision is based on the size and complexity of the
project, as well as the project's expected environmental impact. For
example, FHWA may deem a project that is expected to have no
significant environmental impact to be categorically excluded, meaning
that the project will not need an environmental assessment (EA) or an
environmental impact statement (EIS) to comply with NEPA. A project
whose environmental impact is unknown or may be potentially significant
will undergo an EA to determine if the impact could be significant and
thus require an EIS. A project that is expected to have a significant
environmental impact will require an EIS, which will determine the
particular environmental impacts of the project and include plans for
mitigating these impacts. States usually have only a few EISs under way
at any one time, since they are performed generally for the largest
highway projects, which pose significant impacts to the environment.
For projects undergoing an EIS, FHWA issues a Record of Decision when
the process is complete. The Record of Decision indicates whether a
project complies with environmental laws and determines changes to the
project for environmental mitigation, such as the creation of
additional wetlands to mitigate the loss of wetlands or a change in
route to avoid environmental impacts. EPA is responsible for reviewing
and commenting on all major federal actions for which an EIS is
required and for working with FHWA to ensure compliance with
environmental statutes. FHWA has the final approval authority and
determines when the EIS is in compliance with applicable environmental
laws and other requirements.
Outside the environmental arena, states must meet requirements for
paying a prevailing wage for construction work when accepting federal
highway funding. The Davis-Bacon prevailing wage requirement mandates
that workers on all federal-aid highway projects receive at least the
local prevailing wage for their work. The law stems from a Depression-
era practice of transporting workers from a lower-paying area to bypass
local workers who would demand a higher wage. The Davis-Bacon
prevailing wage requirement prevented this practice by ensuring that
workers on federal projects are paid at least the local prevailing
local wage. DOL sets the minimum wage that must be paid in each county
in the United States for various job categories, such as sheet metal
worker or concrete finisher. DOL sets these minimum wage rates based on
periodic surveys it conducts of employers in each county. To show they
have paid the prevailing wage to their employees, highway contractors
must provide their payroll data to the state DOT and certify that they
have complied with the Davis-Bacon prevailing wage requirement. All
subcontractors must provide this documentation to the lead contractor
on a project, known as the prime contractor, who in turn provides it to
the state DOT. The state then reviews the documentation to ensure
compliance; if the state discovers noncompliance, the contractor must
pay the employees supplemental wages to cover the difference between
what was paid and the original agreed-to prevailing wage. If the
contractor still does not comply with wage requirements, the state DOT
may use contractual remedies, such as withholding progress payments, to
ensure compliance. FHWA occasionally spot-checks the documentation to
further ensure compliance with the Davis-Bacon prevailing wage
requirement.
The DBE program requires that states attempt to expend a portion of the
funds they receive from U.S. DOT for highways, transit, and other
transportation-related contracts to firms owned by members of
disadvantaged populations. The intent of this program is to remove
barriers to participation in federal contracting and ensure
nondiscrimination in awarding federal contracts. Legislation, executive
action, and judicial decisions have resulted in modifications to the
initial program. U.S. DOT presumes disadvantaged population groups to
include African-Americans, Hispanics, Asians, Native Americans, and
other minorities found to be disadvantaged by the Small Business
Administration.[Footnote 7] To be eligible to participate in the DBE
program, firms must be at least 51 percent owned by a member or members
of these groups. Where there is a contract goal on a particular
contract (not all U.S. DOT-funded contracts must have contract goals),
the state tells the prime contractor to subcontract a set percentage of
the project's work to a DBE subcontractor or, if unsuccessful, to
demonstrate that a "good faith effort" was made to find a DBE
subcontractor.[Footnote 8]
Each state has a process for certifying firms that wish to participate
in the DBE program. States use several criteria, established by U.S.
DOT, to determine whether a firm can participate in the DBE program,
including verifying that the owner of the DBE firm has a personal net
worth under $750,000. Under the DBE rules, a DBE firm's participation
counts toward a goal only if the firm performs a "commercially useful
function" to ensure that the firms are not hired simply to meet the
program's goals. FHWA works with states to ensure that they meet the
program's goals on highway projects and also periodically audits
individual state programs to ensure that the programs are operating
within the law. Other U.S. DOT entities, such as the Federal Transit
Administration, ensure that the DBE program's goals are met in other
transportation areas. The U.S. DOT Inspector General investigates cases
of possible fraud, such as where firms misrepresent themselves as
minority-owned.
Finally, FHWA's Buy America program establishes requirements related to
purchasing materials. Specifically, the Buy America program requires
that federally funded highway projects use steel manufactured in the
United States. FHWA officials said the goal of the program is to
protect the U.S. steel industry from foreign competition.[Footnote 9]
FHWA has the statutory authority to grant waivers to states when
domestic iron or steel is unavailable or when there is another
compelling public interest to use imported iron or steel, and FHWA has,
through regulation, established a program threshold limiting the
program to projects costing over $2,500. In addition, under an
alternative bid procedure, states may use foreign iron and steel if the
lowest total project bid using domestic materials exceeds the lowest
total bid using foreign materials by 25 percent. Contractors working on
federally funded highway projects must provide documentation and a
certification regarding the country in which the iron and steel
originated. All manufacturing of the iron and steel must take place in
the United States. If any part of the manufacturing occurs outside the
United States, the iron or steel is considered foreign. State DOTs spot-
check iron and steel, and the appropriate certifications, to ensure
compliance. FHWA must approve the procedures that states use to verify
compliance and can also perform spot checks. If a state DOT or FHWA
finds that foreign iron or steel was used in a highway project, the
contractor must remove the offending iron or steel. This can delay the
project and add costs, although in these cases, the contractor is
responsible for the additional costs to correct the mistake.
Several Types of Benefits and Costs Are Associated with Federal
Requirements for Highway Projects, but Quantitative Estimates Are
Limited:
Many of the 30 studies we reviewed concluded that there are different
types of benefits and costs linked to federal requirements for highway
projects. However, only a few of these studies attempted to quantify
these benefits or costs. For federal environmental requirements, the
most visible and measurable benefits are fewer adverse impacts to the
environment. The benefits also include improvements in air and water
quality and preserving wetlands, among other things. While providing
benefits, federal environmental requirements can also increase
projects' overall costs. Studies have quantified some of these costs,
such as those for administering NEPA, but have not quantified other
types of costs, such as those that occur when projects are delayed for
environmental reviews. In general, quantitative information on
environmental benefits and costs is limited because states have not
tracked such information; however, some states are beginning to do so.
The information on the benefits and costs of the Davis-Bacon prevailing
wage requirement identifies benefits due to creating a level playing
field for contractors and ensuring a prevailing wage for skilled
workers and costs due to administering the requirement. However, the
literature we reviewed is not exclusive to transportation or highway
projects. Finally, although none of the studies we reviewed identified
benefits of the DBE program, transportation officials identified some
benefits of the program, such as providing greater opportunities for
minority-and women-owned firms on federally funded projects. The
studies we reviewed did identify benefits of the Buy America program,
including protecting against unfair competition from foreign firms and
costs of the DBE and Buy America programs, such as increased
administrative costs to states and U.S. DOT due to participation in the
DBE program and potentially higher iron and steel costs. However, none
of the studies we reviewed separately estimated the costs of the Buy
America program's requirements. Despite the potential for bias in
studies with economic and political implications, such as those we
reviewed, we concluded from our review of the studies' methodologies
that the studies were sufficiently reliable for the purposes of our
report. As noted, however, we did not independently verify the results
of the studies.
Studies Found Benefits and Costs Associated with the Federal
Environmental Requirements, but Quantitative Estimates Are Limited:
Several of the studies we identified described the benefits and costs
of federal environmental requirements for highway projects. However,
the studies generally did not attempt to quantify the benefits and only
quantified some types of costs, such as mitigation costs and costs for
administering NEPA. An FHWA benefit-cost study is one of the few we
found that attempted to describe the costs and benefits of
environmental requirements. For example, it noted that federal
environmental requirements, including those associated with NEPA, have
benefits that can reduce adverse effects on the human and natural
environment.[Footnote 10] These benefits can include measured
improvements in air and water quality and noise pollution levels; the
preservation of water supplies and of historic, cultural, park, and
natural resources; and increased protection of wetlands. However, the
FHWA benefit-cost study indicated that assessing these benefits in
economic terms and measuring them in dollars is difficult because the
valuation of environmental benefits is highly subjective. The study
also indicated that government agencies are not required to track and
quantify these benefits and, therefore, generally do not attempt to do
so.
Other studies we reviewed also found that, while federal environmental
requirements produce benefits, these requirements also can cause states
to incur costs.[Footnote 11] In their NEPA documents, state DOTs must
include plans for complying with environmental laws, as well as
consider mitigating any environmental damage. According to a study FHWA
commissioned in 2006, these mitigation efforts--for example, replacing
wetlands, building sound walls to insulate surrounding areas from
highway noise, or changing the route of a project to avoid
environmental damage--can create costs.[Footnote 12] Some of the
studies that we reviewed attempted to quantify mitigation costs. A 2003
study by the Washington DOT evaluated a sample of 14 projects and
concluded that mitigation efforts and costs vary from project to
project.[Footnote 13] Furthermore, a 2003 study published by the
National Cooperative Highway Research Program (NCHRP), an effort
sponsored by the American Association of State Highway and
Transportation Officials (AASHTO) in cooperation with FHWA, calculated
that the environmental review process adds costs to highway projects
for environmental mitigation activities and that more in-depth reviews
add more costs than less detailed reviews. For example, categorical
exclusions on average added 1.1 percent to a project's overall
construction cost, EAs on average added 1.4 percent, and projects
requiring EISs on average added 2.3 percent.[Footnote 14] The 2006 FHWA
study, which was conducted by TransTech Management, a management
consulting company, reached similar conclusions about environmental-
related cost increases, including costs to process NEPA documents and
mitigation costs.[Footnote 15] In this study, TransTech consultants
conducted case studies of six highway and bridge projects in Maryland,
Montana, New Jersey, Oregon, Utah, and Washington. The study concluded
that overall environmental costs for these projects--which included
replacing bridges and interchanges and widening and upgrading arterial
highways from two lanes to four lanes---ranged from 2 to 12 percent of
total project costs and accounted, on average, for 8 percent of total
project costs.[Footnote 16] The study attributed some of this cost to
requirements for completing NEPA documentation, which involves
coordinating with other agencies, performing a detailed review of
project alternatives, acquiring permits, and conducting public
outreach. In addition, the study identified costs for the construction
of stormwater facilities, mitigation of wetland losses, erosion
control, and landscaping to mitigate likely harms to the environment
from the projects.
When a highway project is delayed, inflation and additional
administrative and labor expenses increase its costs, and environmental
requirements are one of several potential causes of project delays we
identified. A 2003 GAO study reported that according to FHWA, for
projects requiring an EIS and for which FHWA approved the EIS in 2001,
the environmental review took an average of approximately 5 years to
complete.[Footnote 17] Furthermore, environmental reviews can take up a
significant portion of projects' overall time frames. For example,
FHWA's 2001 baseline report stated that for projects constructed in the
last 30 years, environmental review for projects requiring an EIS
accounted for an average of 3.6 years, or approximately 28 percent of
the overall time for project completion.[Footnote 18] In addition, a
study jointly sponsored by FHWA and AASHTO reported that right-of-way
acquisition is a major cause of delay in highway projects, and where
relocation is required, it takes an average of 1 to 2 years to purchase
a right-of-way after negotiations have begun.[Footnote 19] Because
states generally cannot begin to acquire right-of-way until the NEPA
process is complete, the additional time needed for these purchases has
the potential to further delay completion of a highway project. The
study also cited efforts to accommodate and relocate utilities as
another cause of delays during the design and construction phases of
highway projects. While several state DOT officials told us that delays
can increase the overall cost of a project, none could estimate how
much they add to a project's costs, and the studies we reviewed did not
estimate the costs attributable to environmental-related project
delays.
In general, we found that environmental cost data are not routinely
collected. For example, the 2003 NCHRP report found that (1) no
complete and consistent data on environmental costs were available at
the state level and (2) a majority of states do not track environmental
costs separately from overall project costs and no state has an
environmental accounting system that tracks these costs.[Footnote 20]
Additionally, in its benefit-cost study, FHWA concluded that none of
the 32 state DOT environmental officials that responded to a survey in
the 2003 NCHRP report had studied or tracked planning, design, and
environmental costs related to environmental review activities.
[Footnote 21]
According to its benefit-cost study, FHWA is taking steps to strengthen
its own environmental cost-tracking efforts, by conducting a multiphase
effort to measure the impact of NEPA and identify trends. As noted
above, in 2001, FHWA completed a comprehensive baseline study that
assessed the impact of the NEPA process on the total time and costs
involved in completing highway projects. Phase one of the study will be
used to assess future environmental streamlining efforts, including an
ongoing detailed analysis of the time required to complete FHWA's EIS
documents.[Footnote 22] However, for phase two of the study, data
limitations, such as a lack of centrally located official completion
dates for projects that have gone through the NEPA process have
prevented FHWA from analyzing the costs associated with NEPA compliance
efforts.[Footnote 23] Furthermore, recognizing the need to improve
environmental cost estimating methodologies for transportation
projects, including highway projects, NCHRP is creating guidelines for
developing such improved methodologies. These guidelines are scheduled
to be completed in late 2008.[Footnote 24] Additionally, four states
(Montana, Washington, Oregon, and Wisconsin) have begun or plan to
begin efforts to quantify the environmental costs associated with
transportation project delivery. For example, an Oregon DOT official
told us that his department has been tracking annual overall
environmental costs for project development since 2000, as required by
the Oregon legislature. These costs have consistently averaged 4.5
percent of overall project costs.
Studies Included Information on the Benefits and Costs of the Davis-
Bacon Prevailing Wage Requirement but Did Not Specifically Focus on
Highway Projects:
Several studies we reviewed attempted to quantify benefits and costs of
the Davis-Bacon prevailing wage requirement, but these studies did not
provide data exclusive to transportation or highway projects. According
to FHWA's benefit-cost study, benefits associated with the Davis-Bacon
prevailing wage requirement include (1) creating a level playing field
for honest contractors, (2) ensuring that skilled workers are paid
wages that prevail in the communities where the work is performed, and
(3) minimizing predatory contracting practices that could undercut
local contractors. FHWA's benefit-cost study also found that the
requirement also promotes more training for labor, resulting in more
experienced and qualified contractors working on highway projects.
[Footnote 25] In addition, the National Alliance for Fair Contracting,
a labor-management organization, and the Construction Labor Research
Council, an organization that researches construction labor costs,
conducted studies in 1995 and 2004, respectively, which concluded that
higher prevailing wages under the Davis-Bacon prevailing wage
requirement contributed to higher productivity on federal highway
projects. The studies concluded that the cost per mile for highway
construction was inversely related to the hourly wage paid to
contractors--specifically, that a higher wage rate resulted in a lower
highway cost per mile--which could indicate a positive effect of the
Davis-Bacon prevailing wage requirement. According to the report,
higher wages attracted high-quality, highly skilled labor; enhanced
productivity; and possibly offset potential labor cost savings from
lower wages.
Some studies we reviewed also focused on the costs of the Davis-Bacon
prevailing wage requirement in general but did not separately estimate
costs for highway or transportation projects. For example, a 2004
University of Missouri-Kansas City study, commissioned by a labor-
management organization, estimated a total economic loss to the state
of Missouri (lost wages, sales, and income taxes) of over $300 million
if Davis-Bacon prevailing wage laws were repealed.[Footnote 26] Also, a
1995 University of Utah study commissioned by a labor union estimated
that the Davis-Bacon prevailing wage requirement caused construction
costs to increase, but also estimated that the federal government would
incur costs from lost income tax revenue by repealing the Davis-Bacon
prevailing wage laws.[Footnote 27] Furthermore, a 1996 study in the
Journal of Labor Research by a consulting economist estimated that the
federal government would experience savings in wage costs if Davis-
Bacon prevailing wage laws were repealed. This study also estimated
that if the state and local governments subsequently repealed their
prevailing wage laws, all levels of government (federal, state, and
local) could experience savings in administrative and enforcement
costs.[Footnote 28], [Footnote 29]
Studies Did Not Identify Benefits Arising from the DBE Program but Did
Identify Benefits of the Buy America Program and Costs of the DBE and
Buy America Programs:
While we did not find any studies that identified benefits of the DBE
program, FHWA and state DOT officials we spoke with said that benefits
include remedying discrimination and inequality, promoting equal
opportunity in the highway design and construction industry, and
helping DBE firms grow their business. A U.S. DOT official agreed and
said that the achievements of states in using DBE firms are indicative
of the benefits of the program in providing greater opportunities for
DBE firms on federally funded contracts. The U.S. DOT official also
said that in 2006, DBE participation in the federal-aid highway program
totaled at least $2 billion. While the studies we reviewed did not
quantify the benefits of the Buy America program, the types of
potential benefits related to this program, according to literature
cited in FHWA's benefit-cost study, include protecting domestic
employment through national infrastructure improvements that can
stimulate economic activity and create jobs; protecting against unfair
competition from foreign firms as a result of foreign government
subsidies; and maintaining national security interests through the
continued use and development of certain industries within the U.S.
economy, like the iron and steel industries.
In terms of costs, a 2001 GAO report indicated that U.S. DOT, states,
and local transportation agencies incur costs in implementing and
administering the DBE program.[Footnote 30] For example, U.S. DOT
estimated that it incurred about $6 million in costs, including
salaries and training expenses, to administer the DBE program for
highway and transit authorities in fiscal year 2000. Sixty-nine percent
of the states and transit authorities that responded to GAO's survey
for the 2001 report estimated that they incurred a total of about $44
million in costs to administer the DBE program in fiscal year 2000. For
individual state respondents, these administrative costs ranged from a
high of $4.5 million to a low of about $10,000. However, U.S. DOT,
states, and local transportation agencies had not studied or analyzed
other DBE-related program costs. For example, according to the 2001 GAO
study, states and transit authorities had said that the DBE program
increased project costs, but 99 percent of the states and
transportation agencies surveyed for the report had not conducted a
study or analysis to quantify whether the DBE program has an impact on
their contract costs. We reported that U.S. DOT had also not conducted
such an analysis.
Finally, none of the studies we reviewed attempted to quantify the
costs of Buy America program requirements. One study--FHWA's benefit-
cost study--identified higher iron and steel prices, higher overall
project costs, reduced bidding competition, and project delays as the
major types of costs that federally funded transportation projects
could incur in complying with Buy America program provisions, but the
study did not attempt to quantify these costs.
Federal Requirements, among Other Factors, Influence State Funding
Decisions:
According to our survey results, the federal requirements we reviewed
are among the factors that influence states' decisions to use
nonfederal or federal funds for highway projects. Most state
transportation officials we interviewed told us that the federal
requirements may encourage them to use nonfederal funds for certain
highway projects eligible for federal aid because they may be able to
save time and costs, but they also told us that other factors influence
their decisions to use nonfederal funds. Conversely, some state
officials we interviewed told us they may use federal funds to avoid
certain limitations associated with nonfederal funds or to obtain
certain benefits associated with using federal funds. In general, the
type of funding a state chooses to use--nonfederal or federal--varies
and depends on the circumstance in the state. Some states, for example,
have requirements similar to the federal requirements we are reviewing.
This may reduce some of the time or cost savings states might otherwise
realize by using nonfederal funds. Furthermore, a state's decision to
use nonfederal or federal funds is generally influenced by the relative
availability of these funds.
Federal Requirements May Encourage States to Use Nonfederal Funds for
Certain Highway Projects, but Other Factors Also Influence Their
Decision:
Most state transportation officials told us that costs and delays
associated with the federal requirements we reviewed have, in certain
instances, encouraged them to use nonfederal funds for certain highway
projects eligible for federal aid; however, other factors, such as a
state legislature's requirements and the availability of nonfederal
funds, also contribute to a state's decision to use nonfederal funds.
More specifically, 39 of the 51 state DOTs we surveyed reported that,
in the past 10 years, the federal requirements had, in at least one
instance, influenced their decision to use nonfederal funds for highway
projects that were eligible for federal aid.[Footnote 31] A majority
(33 states) of these 39 states reported that the NEPA requirement
factored into their decision to use nonfederal funds rather than
federal funds for highway projects. Some of the 39 states also reported
that the other requirements we reviewed also influenced their decision
making: 5 states noted that the Davis-Bacon prevailing wage requirement
factored into their decision to use nonfederal funds; 2 states noted
that the DBE program factored into their decision to use nonfederal
funds; and 5 states noted that the Buy America program factored into
their decision to use nonfederal funds.[Footnote 32] See figure 2 for
more information on how many states reported using nonfederal funds and
the reasons behind these decisions. The survey used for this study is
reproduced in appendix II.
Figure 2: Percentage of States Using Nonfederal Funds for Highway
Projects because of the Federal Requirements, and the Requirements that
Factored into States' Decisions:
[Refer to PDF for image]
This figure contains a pie-chart and vertical bar graph depicting the
following data:
Percentage of states that made a decision to use nonfederal funds on a
highway project eligible for federal aid because of the federal
requirements, in the last 10 years:
Decided to use nonfederal funds (39 states): 76.5%;
Decided not to use nonfederal funds (12 states): 23.5%.
Number of states that indicated that the requirements we reviewed
factored into their decision to use nonfederal funds rather than
federal funds:
Federal requirement: NEPA;
Number of states: 33.
Federal requirement: Davis-Bacon;
Number of states: 5.
Federal requirement: DBE;
Number of states: 2.
Federal requirement: Buy America;
Number of states: 5.
Note: For the figure on the left, the states that decided not to use
federal funds include 11 states and the District of Columbia.
[End of figure]
Some state DOT officials we interviewed stated that by using nonfederal
funds instead of federal funds for certain projects, they avoided
project delays and costs associated with the federal requirements.
Maine DOT officials, for example, told us that if they had used federal
funds for several particular state-only funded projects, the projects
would have been delayed by one or more construction seasons due
primarily to a requirement designed to protect parklands and
recreational areas.[Footnote 33] Instead, Maine DOT used state
resources and worked with the State Historic Preservation Officer to
expedite critical bridge improvements through an accelerated review
process. Maine DOT officials told us that although they cannot finance
major EIS projects using only state funds, they are confident that if
they used only state funds for these projects, planning studies at the
EIS level could be expedited by a year or more without any major
changes in the outcome. According to the Maine officials, state
legislation outlines steps necessary in a transportation decision-
making process that consider impacts to the human, social, and natural
environment that are as precise or more as NEPA, but do not contain the
added federal administrative responsibilities.
A few states reported in our survey that the Davis-Bacon prevailing
wage requirement and Buy America program also factored into their
decision to use nonfederal funds on certain projects. A New Hampshire
DOT official that we interviewed told us that the Davis-Bacon
prevailing wage requirement can slow a project because it imposes
payroll processing requirements that create additional administrative
responsibilities, particularly for small highway contractors who may
not understand what they must do to comply. As a result, the state
official told us they use state funds for many small resurfacing
projects to reduce the administrative responsibilities for contractors.
Similarly, Washington DOT officials we interviewed said that they used
nonfederal funds for the Tacoma Narrows Bridge project--which cost
nearly $850 million--and saved $30 million to $35 million by purchasing
foreign steel instead of domestic steel. Had they used federal funds
for the project, they would have had to spend these funds for domestic
steel under the Buy America program.
Some states have minimized project delays by using nonfederal funds for
certain aspects of a project. For example, some states have used
nonfederal funds to acquire the right-of-way for a project--the rights
to the land over which the highway will pass--so that they could
conduct the NEPA review at the same time. Generally, federal funds
cannot be used to acquire a right-of-way until FHWA completes the NEPA
process.[Footnote 34] Some state DOT officials told us that because
states cannot conduct certain NEPA activities concurrently with other
project activities, such as developing an EIS and acquiring right-of-
way, projects can face delays. Ohio DOT officials said that there are
risks in acquiring right-of-way before the NEPA review has been
finalized. For example, after acquiring the right-of-way, the NEPA
document may not be approved or may be significantly modified to
require a right-of-way in a different location. Ohio DOT officials
said, however, that deciding on a right-of-way alternative after
obtaining sufficient information and involving the public involvement
lessens this risk. By using state funds for right-of-way purchases,
Ohio DOT officials said that they are able to reduce project costs
because they avoid the impact of inflation (which would raise property
and construction costs) and complete the project faster. However, these
officials had not tracked or quantified the savings resulting from this
practice. FHWA officials said that states have the option of acquiring
right-of-way with nonfederal funds but that states that do this will
not be eligible to have those acquisition costs reimbursed with federal
funds. Agreeing with Ohio DOT officials, FHWA officials also said that
the state bears the risk in acquiring right-of-way before the NEPA
process is completed.
In addition to the federal requirements, some state officials noted
that other factors play a role in their decisions to use nonfederal
funds for some projects. For example, Washington DOT officials informed
us that their state legislature passed transportation revenue packages
in 2003 and 2005 requiring them to use state funding for selected
projects.[Footnote 35] They had wanted to use federal funding for some
of these projects, particularly those that already have federal agency
involvement due to environmental issues such as a need for permits to
build in a wetland area, but the legislature denied the request.
Sometimes, although not generally, a state may use nonfederal funds for
projects because it has a significant amount of nonfederal funds
available to it. For example, in California, more than 85 percent of
funding available for transportation, including highways, originates
from nonfederal sources. As a result, California funds many projects
with state and local funds. However, California DOT officials explained
that they use state and local funds for these projects--not because of
the federal requirements--but because state funds are more available
than federal funds.
States May Use Federal Funds to Avoid Certain Limitations of Nonfederal
Funds or to Obtain Certain Benefits Associated with Federal Funds:
States may face a number of limitations when they use nonfederal
funding for highway projects and may use federal funds to avoid these
limitations, or they may use federal funds because they can obtain
certain benefits by using these funds. Some states told us that one
limitation associated with using nonfederal funds for projects is that
using these funds and not complying with certain federal requirements
can preclude or delay states from obtaining federal funds later if
needed. More specifically, if a state uses nonfederal funds for a
specific highway project, this project is not required to meet certain
federal requirements, such as the federal design standards.
Consequently, if state officials need additional funding for the
project during its later stages, they may find it difficult to obtain
federal funds because federal requirements were not previously met.
However, some state officials we interviewed said that they follow or
try to follow federal requirements even if they use nonfederal funds
for a project because they then have the flexibility to add federal
funds to the project at any stage. Furthermore, Ohio DOT officials
explained that using state funds for highway projects depletes state
funds that could be used to match federal funds for other highway
projects or other state priorities. Finally, according to Ohio DOT
officials, if nonfederal funds are used on projects, public involvement
in projects may be limited or environmental issues may not undergo
systematic reviews since these projects do not have to comply with the
public and environmental review processes under NEPA. However, as noted
below, some states have environmental requirements that are similar to
NEPA's requirements, which could lessen the impact of this limitation.
Transportation officials in two states told us they often prefer to use
federal funds because they can obtain certain benefits associated with
using these funds. Washington DOT officials told us, for example, that
if they use federal funds for a highway project, FHWA serves as the
lead agency under NEPA and is responsible for coordinating the many
federal agencies that are responsible for the various federal
environmental requirements. However, if they use only nonfederal funds,
states still must comply with federal environmental laws (such as those
involved with protecting air and water quality) but must coordinate
directly with the federal agencies that are responsible for those
requirements, and need not go through the NEPA process. In some
instances, according to the Washington DOT officials, they preferred to
partially fund a state project with federal funds because they have a
good working relationship with FHWA. Furthermore, FHWA can be more
effective than the state in coordinating environmental issues at the
federal level. Also, Massachusetts DOT officials said that federal
agencies are more inclined to cooperate with and respond to another
federal agency, such as FHWA, than to the state DOT, and such
cooperation and responsiveness can contribute to a project's success.
For example, FHWA can obtain Coast Guard permit exemptions that state
DOTs cannot, allowing some federally funded projects to proceed faster
than comparable nonfederal projects.
Some States Consider Differences between Federal and State Requirements
When Deciding Whether to Use Nonfederal or Federal Funds for Highway
Projects:
Some states have requirements similar to the four federal requirements
we reviewed, and some state officials told us that they consider the
differences between these requirements when deciding whether to fund
highway projects with nonfederal or federal funds. Furthermore, having
state requirements that are similar to the federal requirements may
reduce some of the time or cost savings states might otherwise gain by
using nonfederal funds.
According to the Council on Environmental Quality, a federal agency
that oversees NEPA, 16 states and the District of Columbia have
environmental planning requirements similar to NEPA requirements. Other
states, including New Hampshire and Illinois, have state environmental
requirements that address specific environmental issues, such as
wetlands protection, but do not have an environmental planning law like
NEPA that provides for an environmental review process. FHWA's benefit-
cost study noted that the extent to which state environmental
requirements overlap with federal requirements varies from state to
state.[Footnote 36] The study also noted that state requirements that
parallel NEPA requirements could be more than, less than, or just as
stringent as the federal requirements. FHWA officials agreed, noting
that, while some environmental processes--such as California's
Environmental Quality Act--are fairly stringent like NEPA, other state
environmental processes may not be. Furthermore, in some cases, a
federal agency can authorize a state to use its own state environmental
requirement to meet the federal requirement. For example, in the
National Pollutant Discharge Elimination System (NPDES) stormwater
permit program, EPA has approved most state NPDES permit programs and
allows these approved states to administer permits, in lieu of EPA, to
allow discharges into U.S. waters.
In addition to state environmental requirements, some states have
requirements that are roughly equivalent to the Davis-Bacon prevailing
wage, DBE, and Buy America requirements we reviewed:
* According to FHWA's benefit-cost study, 32 states and the District of
Columbia have active prevailing wage laws. State prevailing wage laws
may require higher or lower wages than Davis-Bacon prevailing wages.
For example, state DOT officials told us that in certain portions of
Utah and Oregon, the federal Davis-Bacon prevailing wage rate is higher
than the state prevailing wage rate; however, Maryland officials told
us that for many projects, Maryland's prevailing wage rate is higher
than the federal Davis-Bacon prevailing wage rate. Furthermore, some
contractors said that they pay their employees wages that are higher
than the federal Davis-Bacon prevailing wage. Similarly, Hawaii DOT
officials said that they, with little or no exception, award their
federal-aid highway construction contracts to unionized contractors and
that union wages in Hawaii are typically higher than Davis-Bacon
prevailing wage rates.
* Some states have laws to encourage participation from minority-owned
enterprises in transportation projects.[Footnote 37] For example, in
Maryland, there are federal and state DBE programs. FHWA officials told
us that state DBE programs may or may not mirror the federal DBE
program and that state DBE programs vary. For example, some state
programs have residency requirements to encourage local businesses,
while other states do not.
* Some states have laws that require the use of domestically made steel
and other materials. State requirements that are parallel to Buy
America requirements are often noted in a state's standard
specifications, which are included in the bid documents provided to
highway contractors. For example, West Virginia has a standard
specification that requires that projects use aluminum, glass, steel,
and iron products that are domestically fabricated. Texas also has a
steel preference provision. This provision notes that a contract
awarded by Texas DOT that does not use federal aid must contain the
same preference for steel and steel products as required by the federal
Buy America program.
In terms of environmental requirements, some state officials said they
consider the differences between state and federal requirements, while
other officials may not. For example, Hawaii DOT officials told us that
the differences between the state and federal environmental
requirements may influence their funding decision making because the
state process is less rigorous, less time-consuming, or both, and as a
result, the state process is less costly than the NEPA process.
Washington DOT officials noted, however, that a project employing
nonfederal funds may not realize time and cost savings because projects
that use these funds still have to comply with a number of federal
environmental laws that require coordination among and the involvement
of federal agencies to, for example, provide permits to impact
wetlands. Accordingly, Washington DOT officials may or may not consider
the differences between federal and state environmental requirements
when deciding whether to use nonfederal or federal funds for a highway
project.
In considering prevailing wage requirements, states may choose to use
nonfederal or federal funds for projects when federal Davis-Bacon
prevailing wage rates are higher than the state's prevailing wage rate.
For example, in an interview, Utah DOT officials told us that Davis-
Bacon prevailing wages are higher than market wages in portions of
Utah. Consequently, Utah DOT tries to fund complete road reconstruction
projects--which are labor-intensive--with nonfederal funds so that
state dollars can be stretched further. Conversely, they use federal
funds--and, therefore, pay the Davis-Bacon prevailing wage rates--for
smaller rehabilitation or preservation projects. This lowers Utah DOT's
overall costs, but Utah DOT officials were unable to quantify savings.
Similarly, Oregon DOT officials noted that in some areas of Oregon, the
federal Davis-Bacon prevailing wage is higher than the state prevailing
wage. However, the Oregon officials told us that state law requires
that--when federal funds are involved--contractors compare the federal
Davis-Bacon prevailing wage rates and the state prevailing wage rates
and pay the higher of the two.
The Availability of Nonfederal and Federal Funds Also Influences
States' Funding Decisions:
Regardless of whether states decide to use nonfederal or federal funds
for their highway projects, their decisions are generally influenced by
the relative availability of these funds. Officials from many states
told us that their nonfederal funds are more limited than their federal
funds. Hence, the extent to which states use nonfederal funds to avoid
the federal requirements is limited. Our survey responses indicate that
37 states did not often use nonfederal funds on highway projects to
avoid federal requirements. More specifically, these 37 states reported
that they used nonfederal funds to avoid the federal requirements less
than 50 percent of the time. Officials from one of these 37 states,
Hawaii, said that they have limited nonfederal funds available. As a
result, the officials said that they do not often use nonfederal funds
to avoid federal requirements and that they have to rely on federal
funds to finance their highway projects. Similarly, other states we
spoke with also rely on federal funds to finance their highway
projects.
In our interviews, officials from some states that rarely use
nonfederal funds to avoid federal requirements told us that if they had
more nonfederal funds available, they would use those funds for highway
projects more frequently in order to expedite projects. Utah is one
state that has a significant amount of nonfederal funds available for
highway projects, and it uses these funds to expedite projects.
[Footnote 38] Utah obtains about 75 percent of the funds for its
highway program from the state and about 25 percent from the federal
government. Because Utah has such a high proportion of state funds
available, Utah officials reported on our survey that they use
nonfederal funds to avoid the federal requirements more than 50 percent
of the time, but not always. Officials we spoke with also told us that
because Utah has abundant state funding, the state tries to fund its
smaller projects with federal funds and its larger, more complex
projects with nonfederal funds. Utah officials also noted that using
state funds has the benefit of generally reducing the time and cost to
complete a project, though they have not quantified or tracked this
information.
Government Agencies and Contractors Face Challenges Associated with
Federal Requirements, and Some Are Using Strategies to Address These
Challenges:
The federal, state, and local government agencies and contractors we
interviewed said that they face a number of challenges complying with
the federal requirements associated with federal highway projects and
that these challenges contributed to increased project costs and
delays. The challenges deal with (1) administrative requirements and
coordination with multiple government agencies and (2) provisions that
state transportation officials and contractors say make it difficult
for them to implement the requirements as efficiently as possible.
Officials are implementing a number of strategies to address these
challenges, including federal-level programs that provide states with
guidance and opportunities to participate in streamlining pilot
programs, as well as state initiatives to make their compliance
processes more efficient.
State Transportation Departments and Highway Contractors Face
Challenges Related to Administrative Requirements and Coordination with
Stakeholders:
Some state and local transportation officials and contractors stated
that the federal requirements we reviewed add to their administrative
requirements, such as preparing detailed documentation, which require
substantial resources, adding to project costs and delays. They also
claimed that coordinating with the multiple stakeholders involved in
planning a highway project can be challenging because agencies may have
competing interests and lack enforceable time frames.
Managing Administrative Requirements:
Some state and local transportation officials and contractors told us
that the amount of documentation they prepare to comply with federal
requirements can add to their administrative requirements. For example,
state transportation officials we interviewed told us that lawsuits
challenging environmental decisions can cause delays and increase
costs, in part because they sometimes prepare more documentation to
satisfy federal agencies that are taking precautions to avoid lawsuits.
FHWA officials told us that documentation requirements are intended to
enable time savings later in the highway project process. Additionally,
at a September 2008 Transportation Research Board conference, several
state and local transportation planners said that federal agencies
encourage them to develop multiple alternative project designs that
they think will never be selected just to satisfy specific federal
agencies and environmental groups and to avoid lawsuits from opponents
of the project.[Footnote 39] According to FHWA guidance, however, the
identification, consideration, and analysis of alternatives are
important components of the NEPA process and contribute to objective
decision making. Furthermore, the guidance states that the
consideration of alternatives leads to a solution that satisfies the
transportation need, while at the same time protecting environmental
and community resources.
Separately, according to an AASHTO study, most EIS documents exceed 300
pages and some may even exceed 1,000 pages, even though federal
regulations state that this document should normally be no more than
150 pages and those associated with complicated projects no more than
300 pages.[Footnote 40] Idaho DOT officials said that for some projects
designated as categorical exclusions, where the projects were expected
to have no significant impact, they had to prepare the same amount and
level of documentation as for projects requiring more complex EAs,
which requires a longer and more detailed process than categorical
exclusions because the environmental impact, if any, needs to be
determined. FHWA officials, however, said that they are not aware of
any recent changes in documentation trends for categorical exclusions.
According to many state transportation officials, redundancy in the
requirements also increases the amount of documentation they must
prepare. For example, Florida DOT officials told us that when states
have requirements similar to the federal requirements, officials
frequently must prepare separate documentation for both sets of
requirements, raising administrative costs. However, Maryland DOT
officials told us that their state and federal requirements are
combined into one process in order to meet both obligations and are
supportive of each other. As a result, Maryland DOT officials indicated
that there did not appear to be project delays or increased project
costs due to redundancies. Separately, state DOT officials said that
redundancies in the federal requirements can increase their
administrative costs. For instance, officials from two states told us
that the documentation required for a section of the National Historic
Preservation Act is very similar to documentation for the requirement
aimed at protecting parklands and recreational areas, but the paperwork
prepared for one does not always satisfy the other, potentially
increasing the states' administrative responsibilities.
According to federal, state, and local transportation officials we
spoke with, requirements related to the Davis-Bacon prevailing wage
requirement can also impose administrative responsibilities on states
and contractors that can raise costs. For example, the Davis-Bacon
prevailing wage requirement requires contractors to submit all weekly
payrolls for all employees and any requests for new job classifications
to their state DOTs and ultimately to DOL. Contractors that we spoke
with submit both by hard copy because they were under the impression
that DOL requires a manual signature for payroll certification. As a
result, according to officials from some state DOTs, states handle a
large amount of related paperwork, which may add to project costs.
Texas DOT, for example, estimates that they receive over 4,000
certified payrolls each week from their active contractors and
subcontractors, and is responsible for reviewing 10 percent of all
payrolls submitted for each contract. State and local transportation
officials said that electronic submission of weekly payroll statements
and certifications would make Davis-Bacon prevailing wage paperwork
processing more efficient and more thorough and would decrease
administrative responsibilities. Recognizing that online processing
would be useful, DOL created a pilot program for selected contracting
agencies and contractors to submit Davis-Bacon prevailing wage payroll
statements and certifications online, and FHWA encouraged contracting
agencies, such as state DOTs, to participate in the program. (See
appendix III for more information.)
Additionally, some state transportation officials told us that the
Davis-Bacon prevailing wage classifications have not been established
for common highway jobs, which contributes to additional paperwork.
These officials and contractors also told us that even though the Davis-
Bacon prevailing wage tables are outdated, they must still complete
paperwork to comply with the requirement. For example, in the wage
table for Tampa, Florida, heavy construction does not include wages for
two basic classes of jobs for bridge construction, concrete finisher
and pile driver operator. Some state transportation agency officials
said that if a job classification is not listed on the wage tables,
contractors submit requests for a wage determination to DOL for each
contract that involves that type of work. State transportation
officials said that this requirement increases their paperwork
responsibilities, which in turn increase costs because fulfilling these
responsibilities requires an extensive amount of staff resources. For
example, officials at Florida DOT said that when a new classification
is added on a contract, it is only good on that particular contract and
that they process hundreds of these requests each year. In general, DOL
officials stated that the job classifications are sufficient. Regarding
the wage tables, officials from Florida also said that the Davis-Bacon
prevailing wage surveys that DOL uses to develop the wage tables are
outdated. For example, DOL bases Davis-Bacon prevailing wages for
highway construction in some counties in Florida on 1993 wage surveys.
As a result of the outdated surveys, Florida DOT officials said that
contractors typically pay higher wages than the federal Davis-Bacon
prevailing wages to attract and keep employees. The Florida officials
said that although contractors pay higher wages than the Davis-Bacon
prevailing wage, they still must show compliance to the Davis-Bacon
prevailing wage requirement on federal projects. As such, Florida
officials stated the compliance process is an "exercise in paperwork."
Contractors in Idaho agreed with Florida DOT officials, stating that
although they pay employees the market rate (which is higher than the
Davis-Bacon prevailing wage rate), they still have to adhere to Davis-
Bacon prevailing wage paperwork requirements, which is costly and time-
consuming to complete and submit.[Footnote 41] DOL officials stated
that the process they use for updating wage tables is appropriate.
These officials also said that they update the wage tables at their
discretion, but not on a set schedule, and that they take into account
the age of the previous survey, anticipated construction volume in a
state, and other factors in deciding when to update a wage table.
Managing Multiple Project Stakeholders:
Some state DOT officials said that interagency coordination is a
challenge in the NEPA process--both in getting all the government
agencies to coordinate on a project's design and obtaining necessary
permits. FHWA, along with federal agencies with environmental review
responsibilities (known as resource agencies),[Footnote 42] relevant
state agencies, and other planning stakeholders participate in and
review detailed assessments of environmental impacts, in accordance
with their responsibilities under federal or state laws. Florida DOT
officials noted that they may coordinate with as many as 23 different
entities in planning, reviewing, and constructing highway projects. The
Safe, Accountable, Flexible, Efficient Transportation Equity Act: A
Legacy for Users (SAFETEA-LU) amended the law to require transportation
agencies to engage government agencies and other planning stakeholders
to collaborate during the initial project planning and throughout the
NEPA process.[Footnote 43] However, numerous federal, state, and local
transportation officials said that it is challenging to coordinate
these government agencies and planning stakeholders because these
entities (1) have limited funding and staff, (2) have responsibilities
and priorities beyond transportation projects, and (3) may have
competing interests and missions that can be difficult to resolve. Our
previous report on highways and the environment also found similar
challenges. More specifically, this report found that resource agency
officials viewed their core regulatory duties as their main
responsibility and that resource constraints, according to these
officials, hampered the resource agencies' ability to take on extra
responsibilities. These constraints may limit their ability to fully
participate in the early stages of environmental reviews.[Footnote 44]
Furthermore, competing interests and missions can increase the time
frame of a project. For example, Florida DOT officials said that on a
historic bridge project, the Coast Guard wanted to build a new bridge
for navigational purposes, but other federal and state agencies who
were responsible for historic bridges wanted to save the historic
integrity of the bridge by rehabilitating it rather than constructing a
new one. The disagreement between the two parties caused delays in the
development of the EIS, causing the EIS to take about 5 years to
complete.
Several state transportation officials and FHWA officials told us that
while they collaborate with each other and the resource agencies to set
deadlines, once they identified the agencies that will need to be
involved in the project, approval and permitting agencies routinely
miss deadlines, often delaying projects. For example, a project must
receive a permit from USACE if the project involves the discharge of
dredged or fill material into water. Several state DOT officials told
us that this permitting process can be particularly time-consuming. One
Idaho transportation official told us that for a bridge project in
Idaho, Three Cities Rivers Crossing, it took an additional 1.5 years to
review the EIS, partly due to USACE missing its deadline for issuing
comments. FHWA officials said that there is no consequence to resource
agencies or relief to transportation agencies if the resource agencies
fail to meet the deadline. USACE officials said that requests for
highway project reviews are evaluated in a timely manner, given that
USACE has many applicants requesting authorization to impact U.S.
waters, including other state and federal agencies and the general
public.
State Government Agencies and Contractors Face Challenges Complying
with Some Provisions of Federal Requirements:
According to some state transportation officials and contractors,
certain provisions within the federal requirements we reviewed appear
to be outdated, narrowly defined, or unclearly defined, resulting in
difficulties in implementing the requirements, and potentially
increasing project costs and delays. In general, FHWA or other federal
government officials did not agree with the state officials' assessment
that the provisions are outdated, narrowly defined, or unclearly
defined.
Several state DOT officials told us that, in their opinion, the $2,500
regulatory cost threshold for compliance with the Buy America program
and the $750,000 regulatory personal net worth ceiling for the DBE
program were outdated.[Footnote 45] FHWA established the Buy America
threshold to avoid burdening states with administrative
responsibilities for small projects but has not revised the threshold
since 1983. FHWA officials said that they have not revised the
threshold because limited staff resources and other potential statutory
program changes have delayed scheduled revisions. State DOT officials
said that the cost of steel for most projects, even small ones, falls
above this threshold, given recent increases in steel prices. As a
result, states may not obtain the administrative relief the law
intended for small projects. FHWA officials agreed that the threshold
should be re-evaluated or updated, and officials at one state DOT
suggested that the threshold be adjusted for inflation.
Additionally, according to some state transportation officials we met
with, the DBE program's $750,000 ceiling on personal net worth is
outdated. According to the state DOT officials, the ceiling does not
meet current economic standards and has not kept up with current
inflation rates. U.S. DOT established this ceiling in 1999 to ensure
that wealthy individuals are not allowed to participate in the program.
U.S. DOT established the $750,000 limit based on what they believed to
be a well-established and effective part of the Small Business
Administration's (SBA) assistance programs for small disadvantaged
businesses and because the $750,000 figure provided for a reasonable
middle ground in view of the wide range of suggestions calling for
higher or lower ceilings. However, U.S. DOT officials said that they
have not revised this ceiling since 1999 because SBA has not adjusted
the thresholds for its SBA programs. Furthermore, according to a U.S.
DOT official, since courts look closely at whether the DBE program is
"over-inclusive" (i.e., serving people that it is not intended for),
the ceiling has become important to the constitutional defense of the
program as several federal court decisions have cited the existence of
the ceiling as one of the factors leading them to uphold the program's
constitutionality. California transportation officials said that one
challenge with an outdated personal net worth ceiling for the DBE
program is that the low ceiling makes it difficult to recruit new DBEs
for certification and retain them in the DBE program. U.S. DOT reviewed
the ceiling in 2005 when they reviewed the DBE airport concessions
rule. At that time, the U.S. DOT concluded that the $750,000 cap was
appropriate, as it ensured that wealthy individuals did not participate
in the program. FHWA officials agreed, however, that the personal net
worth ceiling should be adjusted for inflation.
According to officials at some state government agencies and
contractors, the Buy America program's definition of foreign steel may
be too narrowly defined, which they say has caused delays or has
increased project costs. More specifically, FHWA regulations for the
Buy America program state that all manufacturing processes that modify
a product's physical size, shape, or chemical content must occur in the
United States. For example, if steel materials are sent to a foreign
country to be rolled or if a piece of machinery includes one small
component of foreign steel, that product is considered to be foreign
made and is not in compliance with Buy America. Florida DOT officials
said one challenge with this definition is that it is difficult for
them to find domestic manufacturers of mechanical systems for certain
movable bridges. Florida DOT officials and contractors told us that the
time they spend searching or waiting for domestic materials to be
produced adds to project delays. State DOT officials also said that the
Buy America provision can cause construction delays if it is discovered
that the requirement is not being met after construction begins.
Construction delays are generally the result of the domestic product
not being available in sufficient quantities to meet project schedules
or if the domestic product is not regularly produced. Furthermore,
Florida DOT officials also told us that for the movable bridges, there
are many components that require some level of work in a foreign
manufacturing shop that then renders the entire component as foreign,
even though the majority was domestically produced. In such cases, a
waiver can be requested from FHWA. However, FHWA officials said that
domestic suppliers are found for the majority of waiver applications.
If FHWA does not grant a waiver, the design of the project needs to be
corrected or the foreign components need to be replaced with domestic
components.
Lastly, some state transportation agency officials also said that the
waiver provisions in the Buy America program are not clearly defined,
and as a result, the waiver process may be inconsistently interpreted
or applied at the federal level. Some state transportation agency
officials told us that they often do not apply for Buy America waivers
because the process lacks defined criteria and has led to inconsistent
FHWA approvals. According to state transportation officials, waivers
could help state transportation agencies reduce project costs by using
potentially less expensive foreign steel. FHWA recently started posting
notice of waiver requests on its Web site for public comment for a 15-
day period and also published notices of findings on waiver requests in
the Federal Register.[Footnote 46] These notices include more detailed
justification for approving the waiver. Officials from the American
Iron and Steel Institute, an industry trade association, told us they
think these changes will result in more transparent approvals; however,
FHWA officials said these new notification processes will add more time
to projects because additional time is needed to receive and respond to
public comments, especially when there are potential domestic
manufacturers of products that oppose the waiver. In addition, FHWA
officials said that the process of publishing a notice of findings in
the Federal Register requires additional time and could delay a project
if a waiver is requested after construction has already begun.
Project Stakeholders Have Developed and Are Using Strategies to Address
Challenges, with Varying Success:
Congress and federal and state government agencies have developed
strategies to address many of the challenges federal and state
transportation agencies and contractors face in completing highway
projects and complying with federal requirements. According to various
agency officials and highway contractors, some of these initiatives are
resulting in decreased project costs and delays, though they could not
quantify the cost savings or delay reductions. Specifically, Congress
has attempted to improve project delivery time frames. As we have
previously reported,[Footnote 47] with SAFETEA-LU, Congress made a
number of changes to the environmental review processes required of
state and local transportation agencies. For example, SAFETEA-LU
Section 6004 amended title 23 of the U.S. Code to allow state DOTs to
assume FHWA's responsibility for determining whether certain highway
projects can receive categorical exclusions, in accordance with
criteria to be established by FHWA. If a state assumes this
responsibility, FHWA would no longer approve categorical exclusions and
serve more in a monitoring role. This change made by SAFETEA-LU was
intended to facilitate more efficient reviews of transportation
projects, expediting completion without diminishing environmental
protections. Additionally, in 2002, the President issued an executive
order for expedited environmental reviews.[Footnote 48] This executive
order directs executive departments and agencies to accelerate their
environmental reviews for permits and approvals for transportation
infrastructure projects designated by the Secretary of Transportation
to be "high priority." FHWA and state transportation agency officials
said that the executive order has helped expedite the NEPA process.
Separately, FHWA has taken initiatives to provide guidance and
opportunities to better streamline compliance with the federal
requirements. For example, FHWA has developed a database--the State
Environmental Streamlining and Stewardship Practices Database--that
provides opportunities for states to share examples of streamlining and
stewardship practices. This database is available to all state DOTs
through FHWA's Web site. EPA is also using electronic or online
processes to assist them in streamlining projects. For example, they
are using systems to allow stormwater permittees to electronically file
permitting information, which reduces the amount of time that EPA needs
to receive and process this information. Separately, in 2003, DOL
created, and FHWA is facilitating, a pilot program for selected state
DOTs to test software that provides for a Web-based format for the
submission of Davis-Bacon prevailing wage payroll statements and weekly
contractor certifications. The software was designed to eliminate the
paperwork burden associated with labor compliance requirements for
contractors and state DOTs. Other federal agencies, together with
industry associations, have also offered guidance and training to state
and local transportation officials and contractors to help them build
better practices to streamline compliance activities. According to some
state transportation officials, some of these federal efforts have
helped states reduce project costs and delays.
FHWA has recognized that project delays impede transportation system
improvements and that streamlining environmental reviews and
documentation is essential to mitigate the delays and implement highway
projects more quickly and cost-effectively. Accordingly, FHWA has
developed a performance measure--known as the Vital Few Environmental
Streamlining and Stewardship Goal (Environment VFG)--to track the time
it takes for projects to go through EAs and EISs, so that FHWA can
improve the timeliness of environmental review processes, and
ultimately, reduce project delays. Furthermore, by tracking time frames
for environmental reviews, FHWA should be able to develop a better
understanding of the key impediments to, or shortcomings in, the
environmental review process, and address congressional, state, and
other concerns about the process. In fiscal years 2007 and 2008, the
goal of the Environment VFG was to decrease the median time to complete
EAs and EISs to 12 and 36 months, respectively.[Footnote 49] In
developing these goals, FHWA advised state DOTs to establish deadlines,
through negotiation with FHWA division offices and resource agencies,
and track data to measure success through FHWA's Environmental Document
Tracking System (EDTS).
Despite this framework, FHWA has not met its goals for the Environment
VFG performance measure. As figure 3 illustrates, since fiscal year
2004, the median time for completing EISs has increased by almost 26
percent, while FHWA's goal for completing EISs has decreased.
Furthermore, in fiscal year 2007, the median time to complete EISs
reached 68 months--almost 89 percent above FHWA's goal of 36 months.
The median time to complete EAs in the same fiscal year was about 67
percent greater than FHWA's goal of 12 months. FHWA officials told us
that progress in meeting their goals has been slow because delays arise
from federal and state governments' need to address issues that emerge
during project development, such as those issues that are mentioned in
this report. Some state DOT officials also said that environmental
issues that are discovered during the environmental review or changes
in environmental rules established by EPA or at other federal agencies
also contribute to delays. Furthermore, according to FHWA, the federal
environmental review process, as well as state and local impediments
such as funding and local controversy, can cause project delays.
Additionally, as noted earlier, FHWA officials noted that there are no
legal consequences for missing deadlines. Nonetheless, to improve the
time frames, FWHA has analyzed the reasons for why environmental time
frames have not been met and is attempting to improve the time frames
by improving the environmental review process, as required by section
139, 23 U.S.C., since modified by SAFETEA-LU Section 6002, and by
developing additional streamlining initiatives.
Figure 3: Median Times, in Months, Taken to Complete an Environmental
Impact Statement (EIS) or an Environmental Assessment (EA) for Federal-
Aid Highway Projects, Fiscal Years 2003 to 2008:
[Refer to PDF for image]
This figure contains two combination vertical bar and line graphs
depicting the following data:
Environmental assessments (EA):
Fiscal year: 2003;
EA Target, Median number of months to complete: 17;
EA Actual, Median number of months to complete: 26.
Fiscal year: 2004;
EA Target, Median number of months to complete: 16;
EA Actual, Median number of months to complete: 25.
Fiscal year: 2005;
EA Target, Median number of months to complete: 15;
EA Actual, Median number of months to complete: 25.
Fiscal year: 2006;
EA Target, Median number of months to complete: 14;
EA Actual, Median number of months to complete: 34.
Fiscal year: 2007;
EA Target, Median number of months to complete: 12;
EA Actual, Median number of months to complete: 20.
Fiscal year: 2008;
EA Target, Median number of months to complete: 12;
EA Actual, Median number of months to complete: [Empty].
Environmental impact statements (EIS):
Fiscal year: 2003;
EA Target, Median number of months to complete: 51;
EA Actual, Median number of months to complete: 68.
Fiscal year: 2004;
EA Target, Median number of months to complete: 48;
EA Actual, Median number of months to complete: 54.
Fiscal year: 2005;
EA Target, Median number of months to complete: 45;
EA Actual, Median number of months to complete: 60.
Fiscal year: 2006;
EA Target, Median number of months to complete: 40;
EA Actual, Median number of months to complete: 61.
Fiscal year: 2007;
EA Target, Median number of months to complete: 36;
EA Actual, Median number of months to complete: 68.
Fiscal year: 2008;
EA Target, Median number of months to complete: 36;
EA Actual, Median number of months to complete: [Empty].
Source: GAO analysis of FHWA data.
Note: According to FHWA officials, FHWA developed the Environment VFG
in fiscal year 2002 and began setting EA and EIS targets in fiscal year
2003. FHWA developed EA and EIS goals for fiscal year 2008, but actual
times are not available. FHWA officials said that for fiscal year 2009,
the median target time to complete EISs is 60 months, effective as of
October 1, 2008.
[End of figure]
In addition to the federal government, several state transportation
agencies are implementing strategies to expedite compliance with the
federal requirements we are reviewing. These initiatives include
streamlining agreements, called programmatic agreements, that state
DOTs have reached with federal government agencies responsible for
environmental approvals and permits. For example, Texas DOT has a
programmatic agreement with FHWA, the Texas State Historic Preservation
Officer, and ACHP to ensure that compliance with the National Historic
Preservation Act is streamlined. Under this agreement, Texas DOT acts
as FHWA's agent to carry out its responsibilities under the National
Historic Preservation Act, allowing the state to make findings and
determinations on whether there is an adverse effect to historic
properties and to complete the consultation requirements required by
the act. Some state transportation officials told us that they can save
time by entering into agreements with FHWA and resource agencies to
spell out broad categories of projects that can be advanced under
preagreed conditions, with little or no need for individualized review.
Separately, to help resolve staffing shortages at resource agencies,
some state DOTs fund positions for additional staff at federal and
state agencies to perform environmental review activities, including
approval and permitting actions for transportation projects. As we have
previously reported,[Footnote 50] while some states approve of the
practice of funding positions at federal and state resource agencies
for environmental reviews, other states believe the resource agencies
should fund their own activities. USACE officials said that it is
helpful to them to have stable positions at their office, funded by a
state, to focus specifically on transportation issues and permitting
because such a strategy helps the permitting process move more quickly
and consistently. Finally, some state DOTs have developed ways to
streamline the processing of the federal requirements. For example,
Florida DOT officials developed the Efficient Transportation Decision
Making process to address challenges they were facing in coordinating
resource agencies during the NEPA process. This process seeks input
from the resource agencies through an online interactive database for
major projects throughout the NEPA process. According to a Florida DOT
review of the Efficient Transportation Decision Making process, the
process has yielded improved decision making and improved interagency
relationships, among other benefits. See appendix III for more
information on the initiatives mentioned in this section.
Conclusions:
As the demand for highway capacity has increased and as project costs
have risen, the demand for nonfederal and federal highway funds has
grown, making it essential that states and localities use these funds
as efficiently as possible. The four federal requirements we reviewed
have important economic and environmental benefits, but the steps
involved in compliance may add time and costs to projects. Federal and
state strategies have helped to address some of the challenges involved
in compliance. However, quantitative information is limited. For
example, we found little information quantifying the benefits, delays,
and costs of the requirements we reviewed, though some states are
beginning to track environmental costs incurred during highway
projects. Without quantitative information, agencies cannot compare
costs and benefits or assess the impact of their actions on project
time and costs. With state and local governments constructing and
expanding roads at a time when transportation dollars are limited, it
is critical that states use federal dollars efficiently to finance
their highway projects.
In addition, some outdated provisions in the federal requirements we
reviewed can limit states' ability to spend transportation dollars as
effectively as possible. The $2,500 regulatory threshold for the Buy
America requirement no longer serves its original purpose of exempting
states from the administrative burden associated with this requirement
for small projects. This administrative burden may increase the costs
of small projects, and it reduces the resources available for other
projects. Finally, the $750,000 regulatory personal net worth ceiling
of the DBE program has not changed since 1999, and according to state
transportation officials, increasing this threshold could facilitate
the hiring of minority-and women-owned firms.
Recommendations for Executive Action:
To address the challenges associated with the federal requirements we
reviewed, to better ensure that federal funds are used as efficiently
as possible, and to assist states in minimizing project delays and
costs associated with federal requirements, we recommend that the
Secretary of Transportation re-evaluate the $2,500 regulatory threshold
for the Buy America program and the $750,000 regulatory personal net
worth ceiling of the DBE program, and modify them, if necessary,
through appropriate rulemaking.
Agency Comments and Our Evaluation:
We provided a draft of this report to USACE, ACHP, DOL, U.S. DOT, and
EPA for their official review and comment. USACE, ACHP, U.S. DOT, and
EPA provided technical comments, which we incorporated into the final
report where appropriate. U.S. DOT took no position on our
recommendation regarding the Buy America program threshold and DBE
personal net worth ceiling. DOL officials notified us that they had no
comments on this report.
We are sending copies of this report to interested congressional
committees, the Secretaries of Transportation and Labor, the
Administrator of EPA, the Chief of Engineers at USACE, and the
Executive Director of ACHP. The report is also available at no charge
on the GAO Web site at [hyperlink, http://www.gao.gov].
If you or your staffs have any questions, please contact me at (202)
512-2834 or wised@gao.gov. Contact points for our Offices of
Congressional Relations and Public Affairs are on the last page of this
report. GAO staff who made contributions to this report are listed in
appendix IV.
Signed by:
David J. Wise:
Acting Director, Physical Infrastructure Issues:
[End of section]
Appendix I: Objectives, Scope, and Methodology:
The objectives of this report were to review (1) the types of benefits
and costs associated with selected federal requirements for federal-aid
highway projects; (2) the influence of these federal requirements on
states' decisions to use nonfederal or federal funds for highway
projects; and (3) the challenges associated with the federal
requirements and strategies that federal, state, and local government
agencies and contractors have used or proposed to address these
challenges.
Although many requirements apply to federally funded highway projects,
our review focused on four federal requirements: the National
Environmental Policy Act (NEPA), the Davis-Bacon prevailing wage
requirement, the Disadvantaged Business Enterprises (DBE) program, and
the Buy America program. We selected these four requirements for our
review on the basis of (1) initial interviews with officials in the
headquarters offices of the Federal Highway Administration (FHWA), the
U.S. Army Corps of Engineers (USACE), the Environmental Protection
Agency (EPA), the Department of Labor's Wage and Hour Division, and the
Advisory Council on Historic Preservation's Office of Federal Agency
Programs; and (2) interviews with experts at industry associations,
including the National Conference of State Legislatures, the American
Highway Users Alliance, the American Association of State Highway and
Transportation Officials (AASHTO), the Associated General Contractors
of America, the American Road and Transportation Builders Association,
and the American Iron and Steel Institute. Furthermore, rather than
focusing our review on broader requirements associated with
transportation planning, such as requirements for developing a
transportation improvement program, we focused our review on project-
specific requirements.
To identify the types of costs and benefits associated with these
requirements for federal-aid highway projects, we reviewed published
research and studies. We identified 30 relevant studies by searching
bibliographic databases, using as our criteria studies or reports that
identified benefits, costs, challenges, and strategies used to address
the challenges of complying with the federal requirements. After
identifying the studies, we reviewed each one to determine its
relevance and applicability to our objectives. The studies we reviewed
included reports on highway requirements issued by the Congressional
Research Service and the Congressional Budget Office, as well as
studies issued by state departments of transportation (DOT), AASHTO,
and the National Cooperative Highway Research Program. We also reviewed
GAO reports that addressed agencies' tracking of costs and benefits of
certain federal regulations. Finally, we reviewed an FHWA report
entitled, The Costs of Complying with Federal-aid Highway Regulations.
For each of the studies we identify in this report, we reviewed its
methodology, including the study's datasets, sample size, and data
collection techniques, and concluded that the methodology is
sufficiently reliable for the purposes of our report; however, we did
not independently verify the results of these studies.
To determine the influence of these federal requirements on states'
decisions to use nonfederal or federal funds for highway projects, we
surveyed state DOT officials in all 50 states and the District of
Columbia. In the survey, which appears in appendix II, we asked the
officials how the selected federal requirements factored into their
funding decisions for highway projects eligible for federal aid. After
we drafted the survey, we pretested it in one state to ensure that the
questions were clear and unambiguous, the terminology was used
correctly, the survey did not place an undue burden on agency
officials, the information could be feasibly obtained, and the survey
was comprehensive and unbiased. We found the results of the pretest
sufficient to administer the survey to the other states. To administer
the survey, we obtained from FHWA the appropriate points of contact for
transportation officials at each state DOT. Beginning on March 31,
2008, we e-mailed the survey to these transportation officials. We
received a survey response from every state DOT, thereby achieving a
100 percent response rate. Because this was not a sample survey, it has
no sampling errors. However, the practical difficulties of conducting
any survey, such as problems in interpreting a response to a particular
question or entering data into a spreadsheet, may introduce nonsampling
errors. To minimize such errors, we pretested the survey, as noted, and
verified the accuracy of the data keyed into our data collection tool
by comparing the data with the corresponding survey. The survey used
for this study is reproduced in appendix II.
To supplement the survey, and to give respondents an opportunity to
elaborate on their survey responses, we selected 10 states for follow-
up telephone interviews. In determining which states to select for
interviews, we excluded the 5 states we used as case studies--
California, Florida, Idaho, Maryland, and Texas--and chose our sample
from the remaining states. We also based our selection of these 10
states on their responses to the survey, their funding levels, and
geographic dispersion. The 10 states we selected for follow-up
interviews with DOT officials were Hawaii, Illinois, Maine,
Massachusetts, New Hampshire, Ohio, Oregon, Utah, Virginia, and
Washington.
To identify the challenges associated with the federal requirements and
strategies that various highway project stakeholders have used or have
proposed to address these challenges, we visited and interviewed
officials in California, Idaho, Maryland, and Texas, and interviewed
officials in Florida by telephone. To select these states, we
considered a number of factors. We identified a nongeneralizable sample
based on whether a state (1) participated in the Surface Transportation
Project Delivery Pilot Program, which allowed states to assume NEPA
review authority, or (2) had projects designated for streamlined
environmental review, pursuant to Executive Order No. 13274. In
addition, we interviewed officials from federal agencies and
representatives from industry associations such as AASHTO. These agency
officials and industry association representatives identified states
that had initiated notable streamlined transportation planning and
project development processes. Finally, we included in our sample
states that had received varying levels of federal funding. At the five
states in our sample, we interviewed officials from FHWA division
offices; other federal organizations, such as USACE and EPA division
offices; state and local transportation offices; and metropolitan
planning organizations, as well as private industry contractors and
consultants who worked on federally funded highway projects. To
understand the strategies used to address challenges, we reviewed
public and private sector research, studies, agreements, and proposals
on methods and programs to streamline strategies at the federal, state,
and local levels.
We conducted this performance audit from October 2007 through November
2008 in accordance with generally accepted government auditing
standards. Those standards require that we plan and perform the audit
to obtain sufficient, appropriate evidence to provide a reasonable
basis for our findings and conclusions based on our audit objectives.
We believe that the evidence obtained provides a reasonable basis for
our findings and conclusions based on our audit objectives.
[End of section]
Appendix II: GAO Survey of State Departments of Transportation:
United States Government Accountability Office:
GAO:
Survey of State Departments of Transportation and their Decisions on
Funding Highway Projects:
Introduction:
The U.S. Government Accountability Office (GAO), the research arm of
the United States Congress, is studying how federal requirements factor
into states' funding decisions for highway projects eligible for
Federal Aid Highway Program funds. As part of this study, GAO is
surveying state Departments of Transportation.
Please help us report the most accurate information to Congress by
responding to this brief survey. This survey asks for minimal
information and should take approximately 5 minutes to complete.
Please complete this survey even if your state uses federal funding
only for highway projects. We are interested in all projects that are
eligible for Federal Aid Highway Program (FAHP) funds.
Please complete this survey and email it to us by April 11, 2008.
Instructions:
This questionnaire can be completed using Microsoft Word. Please save
this document to your computer and attach it to an e-mail message to
DaveR@gao.gov. If you prefer, you may print a copy of this
questionnaire, complete it by hand, and fax it to us at 202-512-8774 to
the attention of Roshni Dave. Please call us at 202-512-6516 to alert
us that a fax is being sent).
* Please use your mouse to navigate by clicking on the field or check
box you wish to answer.
* To select a check box simply click on the center of the box. You can
uncheck the box by simply clicking on the check box again.
* To answer an open-ended question, click on the response field and
begin typing. The box will expand to accommodate your answer.
If you have arty questions about this questionnaire, please contact
Roshni Dave at 202-512-6516 or DaveR@gao.gov.
Funding Decisions:
1. In the last ten years, has your state made a decision to use
nonfederal funds for a highway project eligible for federal aid because
of federal requirements? (Mark only one response)
Yes:
No: SKIP to Question #4.
2. Did the following federal requirements factor into your decision to
use nonfederal funds rather than federal funds? (Mark only one response
for each row)
National Environmental Policy Act (NEPA):
Yes:
No:
Davis-Bacon Act:
Yes:
No:
Disadvantaged Business Enterprises (DBE) program:
Yes:
No:
Buy America Act:
Yes:
No:
Other (please specify below):
3. How often does your state use nonfederal funds rather than federal
funds for highway projects to avoid federal requirements? (Mark only
one response)
100% of the time:
More than 50% of the time but less than 100%:
About 50% of the time:
Less than 50% of the time but more than never:
Never:
4. What are the positive outcomes on highway projects of using
nonfederal funds instead of federal funds?
5. What are the negative outcomes on highway projects of using
nonfederal funds instead of federal funds?
6. Who coordinated the completion of this survey?
Name:
Position title:
Telephone number:
E-mail address:
7. Who is most familiar with funding decisions in your state and most
knowledgeable of the selected federal requirements associated with
highway projects that we should contact if a follow-up interview is
needed?
Name:
Position title:
Telephone number:
E-mail address:
[End of section]
Appendix III: Strategies Used or Proposed by Federal and State Agencies
to Address Challenges Associated with Federal Requirements:
Federal and state agencies have implemented or proposed the following
strategies to address the challenges associated with federal
requirements for highway projects.[Footnote 51]
Implementing or authorizing organization:
White House;
Strategy: Environmental Stewardship and Transportation Infrastructure
Project Reviews, Exec. Order No. 13274;
Details: The 2002 executive order authorizes the Secretary of
Transportation to designate infrastructure projects for expedited
environmental reviews. Since these reviews were authorized, 19 projects
have been selected for expedited review, including 15 highway or bridge
projects. Three of our case study states--California, Texas, and
Maryland--have had projects designated for expedited reviews and placed
on the order's project list. State officials in California, Maryland,
and Texas reported mixed results on the effectiveness of the executive
order in expediting environmental reviews. Maryland transportation
officials told us that placing their Inter-County Connector (ICC)
project on the executive order's project list helped move the project
forward. Previously, during the 1980s and 1990s, the project was
stalled by high levels of controversy over environmental issues, lack
of support for the project from state government leaders, and
difficulty in getting stakeholders to collaborate on the project.
Putting the ICC on the project list in 2003 enabled Maryland DOT to
build on renewed support for the project from state government leaders
by formalizing a collaborative process among stakeholders that sped up
the project's delivery. This collaborative process involved the
creation of an interagency workgroup through which staff-level
stakeholders resolved disagreements over environmental issues before
the issues were elevated to higher-level government agency authorities.
Once placed on the executive order project list, the ICC moved from the
planning stage to a final Record of Decision in 2006 for environmental
issues in 3 years. By contrast, California DOT officials said that the
executive order raised agency awareness for the projects placed on the
list in their states.
Implementing or authorizing organization: White House;
Strategy: Council on Environmental Quality Modernizing NEPA Task Force;
Details: The task force, which formulated in 2002, is comprised of
representatives from a variety of different federal agencies, such as
the Environmental Protection Agency (EPA) and the U.S. Forest Service.
This task force reviews current National Environmental Policy Act
(NEPA) implementing practices and procedures and recommends
improvements to make NEPA more effective, efficient, and timely. The
task force developed several products, including a handbook,
Collaboration in NEPA - A Handbook for NEPA Practitioners, published in
October 2007, to improve the NEPA process through collaboration. State
DOT officials were familiar with this task force; however, we heard
varied responses from these officials on whether the products produced
by the task force helped streamline environmental review processes.
Implementing or authorizing organization: Congress;
Strategy: The Safe, Accountable, Flexible, Efficient Transportation
Equity Act: A Legacy for Users (SAFETEA-LU) Section 6002: Efficient
Environmental Reviews for Project Decision-making;
Details: SAFETEA-LU Section 6002 (23 U.S.C. §139) established a new
process to promote efficient project management by federal agencies and
enhanced opportunities for coordination with the public and other
agencies. Several changes were made to the environmental review
process, including a new requirement for a coordination plan for public
and agency participation. We previously reported that changes in the
review process can result in better project decisions; however, some
state transportation officials told us that the process may not
necessarily be more efficient, since extra steps required to comply
with the provision adds time to environmental review. Section 6002 also
changed the law to allow a 180-day limit on lawsuits challenging final
federal agency environmental decisions--such as the approval of an
environmental impact statement-- on highway projects, when notices of
those decisions are published in the Federal Register. We previously
reported state transportation officials' opinions that this could lead
to cost savings because it limits lawsuits to a period when it would
not cost as much to change project plans and, after this period, work
can proceed on a project without the risk of a lawsuit.
Implementing or authorizing organization: Congress;
Strategy: SAFETEA-LU Section 6004: State Assumption of Responsibility
for Categorical Exclusions;
Details: SAFETEA-LU Section 6004 (23 U.S.C. §326) changed the law to
allow state DOTs to assume responsibility for determining whether
certain highway projects can receive categorical exclusions, in
accordance with criteria to be established through a Memorandum of
Understanding between the U.S. Department of Transportation's Federal
Highway Administration (FHWA) and the state. If a state assumes this
responsibility, FHWA does not approve categorical exclusions but does
monitor whether the state is adequately applying FHWA's criteria. A
state can assume this responsibility after waiving its sovereign
immunity. To date, only two DOTs, California DOT and Utah DOT, have
assumed this authority, and only Alaska DOT is seeking it. Some state
transportation officials we spoke with told us that they did not pursue
this approval authority because they already have agreements in place
with FHWA that streamline approvals for categorical exclusions. State
officials also identified the requirement to waive sovereign immunity
as an obstacle to their taking advantage of the categorical exclusions
approval authority. California DOT reported to FHWA that, as a result
of Section 6004, they saved a median of about 28 days and a mean of 7
days for categorical exclusion determinations statewide due to
administrative efficiencies and time savings associated with
consultations and coordination with federal resources agencies. FHWA
officials said that, in general, agreements between state DOTs and FHWA
Division Offices are valuable and they can entail shorter or defined
time frames for reviews and responses. However, we previously reported
that, according to one resource agency, the state assumption of
responsibility for categorical exclusion reviews could decrease the
input from resource agencies in addressing environmental issues.[A]
Although overall interest in Section 6004 is limited, states may be
experiencing similar time savings with their own streamlining
agreements with FHWA.
Implementing or authorizing organization: Congress;
Strategy: SAFETEA-LU Section 6005: Surface Transportation Project
Delivery Pilot Program;
Details: SAFETEA-LU Section 6005 (23 U.S.C. §327) established a pilot
program that gave five states--Alaska, California, Ohio, Oklahoma, and
Texas--the opportunity to assume FHWA's environmental responsibilities
for highway projects under NEPA and other federal environmental laws,
after waiving sovereign immunity and entering into a Memorandum of
Understanding with FHWA. FHWA continues to provide oversight. This
program is designed to provide information on whether delegating these
responsibilities to the state will result in more efficient
environmental reviews, while meeting all federal requirements for these
reviews. California, whose state DOT assumed this responsibility in
July 2007, is the only state participating in the program, although
Alaska has expressed interest to FHWA in applying for this in the
future. The other three states declined the opportunity for various
reasons, including the restriction on using state funds to acquire
right-of-way for highway projects prior to the NEPA decision and the
inability of the states to obtain approval from their legislatures to
waive sovereign immunity, which is required for the program.
Furthermore, as we previously reported, states are concerned about the
amount of work required to set up such a program and want to see how
the program works in California. California DOT officials told us that
the time to conduct environmental reviews has decreased for the
projects that have undergone the NEPA process since California assumed
this authority. They told us that the median review and approval times
for draft environmental documents and final environmental documents was
shorter for pilot program projects compared to prepilot program
projects. For example, they said it took prepilot program projects a
median time of 6.1 months to complete draft environmental documents,
while it took pilot program projects a median of 1.6 months, a savings
of 4.5 months, to complete. Additionally, they said it took a median
time of 2.0 months to complete final environmental documents for
prepilot program projects and 0.8 months for pilot program projects, a
savings of 1.2 months. Part of the time savings, they say, occurs
because FHWA has reduced its review. FHWA published its first audit on
September 23, 2008. The audit reviewed fundamental processes and
procedures the state put in place to carry out the assumptions of the
roles and responsibilities, but it did not report on the program's
impact on environmental review time frames because it was the first
audit that FHWA has conducted. Overall, FHWA found that the California
DOT has made reasonable progress in implementing the startup phase of
Pilot Program operations and is learning how to operate the program
effectively. FHWA's second audit was held in July 2008, and the results
are forthcoming in the Federal Register. In this audit, FHWA examined
performance measures. Specifically, FHWA examined changes in the time
states spent on completing environmental documents.
Implementing or authorizing organization: Congress;
Strategy: SAFETEA-LU Strategic Highway Research Program 2 (SHRP 2);
Details: SAFETEA-LU authorized funding for SHRP 2, a research program
that FHWA, AASHTO, and the Transportation Research Board jointly
conduct to obtain information on highway safety, renewal, reliability,
and capacity. Some of the research focuses on approaches and tools for
systematically integrating environmental considerations into project
analysis and planning. One project involves developing a collaborative
decision-making framework for transportation planners to use to enhance
collaboration from project planning through project development. The
study includes 25 case studies of the challenges faced by state and
local transportation officials when trying to manage multiple
stakeholders. The report is currently in draft.
Implementing or authorizing organization: U.S. DOT;
Strategy: Refocus. Reform. Renew: A New Transportation Approach for
America (Proposed);
Details: To better streamline federal requirements, in 2008, U.S. DOT
has proposed to (1) allow state requirements to satisfy "substantially
similar" federal requirements, (2) exempt projects with less than 10
percent federal funding from federal requirements, and (3) pilot a
project for some states to opt out of federal requirements under titles
23 and 49 (except the Davis-Bacon prevailing wage requirement) in
exchange for a reduction in the percentage of federal funding they
would otherwise receive. The proposal also includes several specific
reforms to the NEPA process: clarifying what constitutes a reasonable
alternative, reducing FHWA documentation requirements by allowing the
final environmental impact statements to be combined with the Record of
Decision into one document to simplify the process, and broadening
categorical exclusion assignment authority to states. This proposal has
not been finalized.
Implementing or authorizing organization: FHWA;
Strategy: State Environmental Streamlining and Stewardship Practices
Database;
Details: This database contains information on streamlining and
stewardship practices used by states as ways to efficiently and
effectively fulfill their NEPA obligations. FHWA officials said that
they regularly update the database with state-nominated practices and
all are available to the public on the Internet. For example, for
Maryland, FHWA has 30 practices listed, including a workshop to address
working relationships between participating agencies in environmental
reviews, various copies of programmatic agreements (described later in
this appendix), and templates for evaluating categorical exclusions.
FHWA officials said that this database provides states with examples
and enables states to share practices for streamlining the
environmental review process. Maryland DOT officials said that this
database is helpful in that it helps them acquire information more
efficiently and that it expands their thinking in the development of
their environmental streamlining agreements--which can ultimately
reduce project costs and delays. Officials at California DOT said,
however, that it is difficult for them to implement solutions from
another state that does not have to comply with as many state
environmental laws and regulations as California. Other states say that
the database has not helped them decrease projects costs or delays.
Implementing or authorizing organization: FHWA;
Strategy: Pilot program to evaluate Web-based submission of Davis-Bacon
prevailing wage weekly payroll statements and certification;
Details: To reduce paperwork burdens described earlier in this report,
in 2003, the Department of Labor (DOL) created and FHWA is facilitating
this pilot program for selected state DOTs to submit Davis-Bacon
prevailing wage weekly payroll statements and contractor certifications
on the Internet. Software automatically downloads information from
payroll processors and performs diagnostics (including issuing an alert
if an employee rate is incorrect). Officials from the two participating
state DOTs that we contacted--Arizona DOT and Wisconsin DOT--told us
that the new process provided automatic electronic approval of payrolls
and eliminated the need for staff to manually review payrolls. An
Arizona DOT official told us that it reduced the amount of paperwork
and repetitive steps and created consistency for payroll submission
across contractors. Both state DOT officials told us that they have
received positive feedback from some contractors. Although, the
Wisconsin DOT official told us that large contractors had challenges
formatting their payroll systems to input data into the software and
that small contractors had problems if they did not have access to
computers. Other challenges both states mentioned focused on
programming the software and educating contractors. Neither state DOT
has tracked cost savings.
Implementing or authorizing organization: AASHTO;
Strategy: Center for Environmental Excellence;
Details: In consultation with FHWA, AASHTO developed the Center for
Environmental Excellence to help streamline environmental review and
transportation delivery processes and encourage environmental
stewardship. It provides transportation professionals with guidance,
training, and access to environmental tools, among other types of
information. The center also provides practitioners with technical
assistance, including on-call help.
Implementing or authorizing organization: State DOTs;
Strategy: Programmatic agreements;
Details: State DOTs have taken the lead to enter into these formal
agreements with FHWA and federal and state agencies to establish
actions and processes for streamlining compliance with environmental
regulations. The agreements often identify categories of projects that
can be advanced under preagreed conditions, with little or no need for
individualized review by those agencies. Agreements address a number of
issues, such as compliance with the National Historic Preservation
Act,[B] NEPA, the Endangered Species Act, and other requirements. For
example, the Texas DOT entered into an agreement with FHWA and the
State Historic Preservation Office (SHPO) in Texas. Under this
agreement, Texas DOT acts as FHWA's agent to carry out responsibilities
under the National Historic Preservation Act, allowing the state to
make findings and determinations on whether there is an adverse effect
to historic properties and to complete the consultation requirements
required by the act.[C] According to FHWA officials, programmatic
agreements have helped streamline the environmental review process.
Officials at the Advisory Council on Historic Preservation also
indicated that programmatic agreements have improved project delivery
time frames.
Implementing or authorizing organization: State DOTs;
Strategy: DOT-funded positions to other agencies;
Details: To help resolve staffing shortages at resource agencies, state
DOTs began in the early 1990s to fund positions for additional staff at
federal and state agencies to perform environmental review activities,
including approval and permitting actions for transportation projects.
Previous transportation legislation, the Transportation Equity Act for
the 21st Century, gave states the option of using a portion of their
federal-aid highway funds to pay for the positions to conduct
environmental reviews and expedite NEPA activities. State DOTs must
obtain the approval of FHWA division offices for such uses of these
funds. According to a 2005 AASHTO survey, 68 percent of state DOTs (34
states) fund positions. Two-thirds of these positions were at state
agencies and the remainder were at federal agencies. SAFETEA-LU amended
the law to allow states to pay for positions whose activities extended
beyond NEPA, including planning activities that precede NEPA. As we
have previously reported,[D] states have mixed views on using state
funds for positions at federal agencies. While some states fund
positions at the federal agencies for environmental reviews, other
states believe the federal agencies should fund their own activities.
USACE officials told us that it is helpful to them to have stable
positions at their office--funded by a state--to focus specifically on
transportation issues and permitting.
Implementing or authorizing organization: Florida DOT;
Strategy: Efficient Transportation Decision Making (ETDM);
Details: ETDM, established in 2004, provides an interactive online
database for government agencies to provide and review environmental
and other information on a project. Florida DOT and multiple federal
and state agencies developed ETDM to address difficulties in getting
involved federal and state agencies to coordinate and provide timely
responses for highway projects. The database provides information that
these agencies need to make decisions, such as project descriptions and
geographic information system maps showing locations of resources. ETDM
asks agencies to concur at certain points in the process to help ensure
their involvement throughout the process and reduce the likelihood that
they will challenge the project later. Since its implementation, 332
transportation projects have been screened through EDTM. Florida DOT
conducted a review of how ETDM was functioning. District officials at
Florida DOT reported several benefits using ETDM, including that ETDM
(1) provided them with better understanding of environmental issues
early in planning and project development, (2) improved decision making
throughout the process, (3) improved interagency relationships, and (4)
improved agency responsiveness. They also estimated that between
October 2004 and March 2008, over 3 years, they have saved 600 months
to complete NEPA-related review activities and around $16 million in
project costs for all of their projects combined.[E] However, they said
since ETDM has not been in place long enough and most projects have not
been through the full project development cycle, project cost and time
savings may not be fully realized. District officials also reported
some challenges with ETDM. For example, they reported that some
agencies commented on environmental reviews outside their
jurisdictional areas and that ETDM increased project scrutiny. Other
government agencies have also reported ETDM's benefits. For example, in
2004, the U.S. Fish and Wildlife Service and EPA reported that since
the implementation of ETDM, they have been able to review more projects
and at a higher level of review. USACE reported in 2006 that ETDM
improved their staffs' knowledge of all the various pieces of the
transportation and planning process, and as a result, removed one of
the barriers of communication between USACE and Florida DOT. However,
some Florida contractors told us that ETDM is not as beneficial as it
could be because not all Florida government agencies participate as
actively as others.
Implementing or authorizing organization: California DOT;
Strategy: Standard Environmental Reference;
Details: The Standard Environmental Reference is an online guidance
document available for California transportation agencies to help them
comply with NEPA and the California Environmental Quality Act. The
document provides users with information on what documentation is
needed in a user-friendly format. California DOT officials told us that
the Standard Environmental Reference enables local transportation
agencies to focus their resources on necessary elements and helps them
to avoid any potential revisions later in the NEPA process.
Source: GAO analysis of information provided by federal and state
agencies.
[A] [hyperlink, http://www.gao.gov/products/GAO-08-512R].
[B] The National Historic Preservation Act requires federal agencies to
take into account the effects of their activities on historic
properties and afford the Advisory Council on Historic Preservation an
opportunity to comment on the effects of the activity.
[C] State Historic Preservation Offices carry out the National Historic
Preservation Act at the state level and consult with federal agencies
during the review.
[D] [hyperlink, http://www.gao.gov/products/GAO-08-512R].
[E] Florida DOT reported that one project in one of its Districts used
the Efficient Transportation Decision Making process even though the
project had already entered its planning phase. This project, unlike
the other projects that used the Efficient Transportation Decision
Making process, experienced increases in project costs and time.
[End of table]
[End of section]
Appendix IV: GAO Contact and Staff Acknowledgments:
GAO Contact:
David J. Wise, (202) 512-2834 or wised@gao.gov:
Staff Acknowledgments:
In addition to the contact named above, Kate Siggerud (Managing
Director), Ray Sendejas (Assistant Director), Tim Bober, Roshni Davé,
Anne Dilger, Bess Eisenstadt, Denise Fantone, Dave Hooper, Bert
Japikse, Alex Lawrence, Ashley McCall, Patricia McClure, Elizabeth
McNally, Amanda Miller, SaraAnn Moessbauer, Revae Moran, Josh Ormond,
and Amy Rosewarne made key contributions to this report.
[End of section]
Footnotes:
[1] The Buy America program referred to here is distinct from the Buy
American program under the Buy American Act. The Buy America program
requires that federally funded highway projects use iron and steel
manufactured in the United States. The Buy American Act applies to
federal contracting, including federal construction contracting.
[2] No state was selected for both a case study and follow-up
interview.
[3] Metropolitan planning organizations are responsible for developing
long-range, regional transportation plans.
[4] The Federal Highway Administration and some states, such as Oregon,
are beginning to track this information.
[5] GAO, Disadvantaged Business Enterprises: Critical Information Is
Needed to Understand Program Impact, [hyperlink,
http://www.gao.gov/products/GAO-01-586] (Washington, D.C.: June 1,
2001).
[6] GAO, Highways and Environment: Transportation Agencies Are Acting
to Involve Others in Planning and Environmental Decisions, [hyperlink,
http://www.gao.gov/products/GAO-08-512R] (Washington, D.C.: Apr. 25,
2008).
[7] Persons who are not members of one of the above groups and own and
control their business may also be eligible if they establish their
"social" and "economic" disadvantage.
[8] Prime contractors can also be DBE firms, though various state
officials stated that the majority of firms participating in the DBE
program are subcontractors.
[9] According to FHWA and steel industry officials, the highway
projects that involve the most iron and steel are generally bridge
projects.
[10] Battelle, The Costs of Complying with Federal-aid Highway
Regulations, a study prepared at the request of FHWA, Washington, D.C.,
August 2008.
[11] A project may incur costs related to compliance with environmental
laws at all phases through its lifespan, including planning,
environmental review, design, and construction.
[12] TransTech Management, Inc., Costs Related to Compliance with
Federal Environmental Laws: Case Studies in the Federal-Aid Highway
Program, a study prepared at the request of FHWA, Washington, D.C.,
July 2006. This study indicated that costs to replace wetlands, control
erosion, and construct stormwater management structures have a much
bigger impact on total project costs than staff and consultant time
spent on project studies and construction engineering.
[13] Washington State Department of Transportation, Washington State
Department of Transportation Project Mitigation Costs Case Studies (May
2003).
[14] National Cooperative Highway Research Program, Improving Project
Costing and Incorporation of New Attributes - Highways and Transit,
Report 20-24 (25) (Fairfax, Virginia, 2003).
[15] TransTech Management, Inc., Costs Related to Compliance with
Federal Environmental Laws: Case Studies in the Federal-Aid Highway
Program.
[16] These projects were selected for the study's sample because they
are projects that are routinely undertaken by state DOTs. Furthermore,
these types of projects experience mitigation and documentation costs.
Mitigation is required to address the typical impacts on natural
resources that can result from these types of projects.
[17] GAO, Highway Infrastructure: Stakeholders' Views on Time to
Conduct Environmental Reviews of Highway Projects, [hyperlink,
http://www.gao.gov/products/GAO-03-534] (Washington, D.C.: May 23,
2003).
[18] Federal Highway Administration, Evaluating the Performance of
Environmental Streamlining: Development of a NEPA Baseline for
Measuring Continuous Performance (Washington, D.C., 2001).
[19] Federal Highway Administration and the American Association of
State Highway and Transportation Officials, Final Report: Strategies
for Reducing Highway Project Delivery Time and Cost (December 2003).
[20] National Cooperative Highway Research Program, Improving Project
Costing and Incorporation of New Attributes - Highways and Transit.
[21] Battelle, The Costs of Complying with Federal-aid Highway
Regulations.
[22] Battelle, The Costs of Complying with Federal-aid Highway
Regulations.
[23] A project's Record of Decision document records the official
completion date for the NEPA process.
[24] National Cooperative Highway Research Program, Improving Project
Environmental Cost Estimates, Report 25-25 (39) (forthcoming).
[25] Battelle, The Costs of Complying with Federal-aid Highway
Regulations. Two studies that reference benefits and enhanced
productivity are: (1) J. Petersen, "Health Care and Pension Benefits
for Construction Workers: The Role of Prevailing Wage Laws," Industrial
Relations, Vol. 39, No. 2, Oxford, UK (April 2000) and (2) The
Construction Labor Research Council, The Impact of Wages on Highway
Construction Costs: Updated Analysis, prepared for the Construction
Industry Labor-Management Trust and the National Heavy and Highway
Alliance, Washington, D.C., 2004.
[26] Michael P. Kelsay, L. Randall Wray, and Kelly D. Pinkham, "The
Adverse Economic Impact from Repeal of the Prevailing Wage Law in
Missouri," prepared for the Council for Promoting American Business
(University of Missouri-Kansas City, 2004).
[27] Peter Philips, Garth Mangum, Norm Waitzman, and Anne Yeagle,
Losing Ground: Lessons from the Repeal of Nine ''Little Davis-Bacon"
Acts, University of Utah, 1995. This study estimated that the
prevailing wage requirement caused construction costs to increase by an
average of 3 percent for each project, but also estimated that the
federal government would lose over $800 million in income tax revenue.
[28] A.J. Thieblot, "A New Evaluation of Impacts of Prevailing Wage Law
Repeal," Journal of Labor Research (Spring 1996).
[29] Data cited in both the University of Utah and the Journal of Labor
Research studies do not reflect current 2008 dollars.
[30] [hyperlink, http://www.gao.gov/products/GAO-01-586].
[31] Some state officials told us that they use nonfederal funds for
highway projects eligible for federal aid because of federal
requirements other than the four requirements within our scope. For
example, they may use nonfederal funds for certain projects to bypass
delays due to State Transportation Improvement Plan processing and to
avoid federal design standards that preclude some projects from being
federally funded.
[32] In the survey we provided to states, a state could select more
than one requirement as factoring into its decision to use nonfederal
funds rather than federal funds. See appendix II for the survey we
provided to each of the states.
[33] According to Maine DOT officials, since Maine's construction
season is short compared to other states, it is possible for a delay of
a couple of weeks to translate into more than a 12 month delay.
[34] 23 C.F.R. § 771.113(a) and 23 C.F.R. § 771.117(d)(12).
[35] The Washington DOT 2003 and 2005 revenue packages increased the
state gas tax by $0.05 and $0.095 per gallon, respectively.
[36] Battelle, The Costs of Complying with Federal-aid Highway
Regulations.
[37] State DBE programs are often identified as minority and women
business enterprise (MBE/WBE) programs.
[38] Utah DOT received a large increase in transportation funding from
its legislature to fund its transportation needs. This funding comes
from the state's general fund and sales tax revenues. According to Utah
DOT officials, Utah DOT receives 83 percent of the state's sales tax
revenues.
[39] Transportation Research Board, "Meeting Federal Surface
Transportation Requirements in Statewide and Metropolitan Planning: A
Conference," September 3-5, 2008.
[40] American Association of State Highway and Transportation
Officials, Accelerating Project Delivery (August 2007).
[41] If an interested party believes that a wage determination does not
accurately reflect those prevailing in the area, the interested party
can request reconsideration of a wage determination by presenting their
request in writing accompanied by supporting data to DOL.
[42] Federal resource agencies include, but are not limited to, USACE,
the Fish and Wildlife Service, EPA, and ACHP.
[43] SAFETEA-LU authorized funding for the federal surface
transportation programs for highways, highway safety, and transit.
[44] [hyperlink, http://www.gao.gov/products/GAO-08-512R].
[45] The Buy America requirement also applies if the cost of steel
exceeds 0.1 percent of the total contract cost.
[46] FHWA conducted these activities to comply with the Consolidated
Appropriations Act, 2008 and the SAFETEA-LU Technical Corrections Act
of 2008. The Consolidated Appropriations Act required the Secretary of
Transportation to make informal public notices and comment
opportunities on the intent to issue Buy America waivers and the
reasons for the waivers. The Technical Corrections Act required that
the Secretary publish in the Federal Register a detailed justification
for Buy America waiver decisions and the reasons for the decisions, and
provide for a public comment period.
[47] [hyperlink, http://www.gao.gov/products/GAO-08-512R].
[48] Exec. Order No. 13274.
[49] See figure 3 for the target goals prior to 2007.
[50] [hyperlink, http://www.gao.gov/products/GAO-08-512R].
[51] This compilation of strategies is not comprehensive.
[End of section]
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