Evaluation and Rating Process
As proposed new starts projects proceed through the stages of the planning and project development process, they are evaluated against the full range of criteria for project justification and local financial commitment contained in §5309(e). In both cases, FTA relies on a multiple-measure approach to assign ratings; these ratings are updated throughout the preliminary engineering and final design processes, as information concerning costs, benefits, and impacts is refined. The results of these evaluations are used to make the required approvals for entry into preliminary engineering and final design, to execute a Full Funding Grant Agreement (FFGA) and to make annual funding recommendations to Congress.
The criteria for new starts project evaluation are described in 49 USC §5309(e). To be eligible for funding under the new starts program, proposed projects must be based on the results of an alternatives analysis and preliminary engineering, justified based on a comprehensive review of a variety of factors, and supported by an acceptable degree of local financial commitment. Sections 5309 (e)(2)-(4) further describe the factors to be considered when making these determinations.
The criteria for evaluating project justification are as follows:
- Mobility improvements
- Environmental benefits
- Operating efficiencies
- Cost effectiveness
- Transit-supportive existing land use policies and future patterns1
Consistent with §5309(e)(3)(H), FTA also includes a variety of "other factors" when evaluating project justification, including:
- the degree to which the policies and programs (local transportation planning, programming and parking policies, etc.) are in place as assumed in the forecasts,
- project management capability, and
- additional factors relevant to local and national priorities and relevant to the success of the project.
Section 5309(e)(1)(C) requires that proposed projects also be supported by an acceptable degree of local financial commitment, including evidence of stable and dependable financing sources to construct, maintain and operate the system or extension. The criteria for evaluation of the local financial commitment to a proposed project are:
- The proposed share of total project costs from sources other than §5309, including Federal formula and flexible funds, the local match required by Federal law, and any additional capital funding ("overmatch");
- The strength of the proposed capital financing plan; and
- The ability of the sponsoring agency to fund operation and maintenance of the entire system as planned, including existing service, once the guideway project is built.
As noted above, FTA evaluates proposed new starts projects against the full range of criteria for both project justification and local financial commitment, using a multiple-measure method. Project evaluation is an ongoing process; as proposed new starts proceed through the project development process, information concerning costs, benefits and impacts is refined, and the ratings are updated to reflect new information.
For each of the project justification criteria, the proposed new starts project is evaluated against both a no-build and a Transportation System Management (TSM) alternative (a package of low to moderate cost improvements designed to make more efficient use of an existing transportation system)2. For each proposed project, FTA assigns one of five descriptive ratings ("high," "medium-high," "medium," "low-medium," or "low") for each of the five criteria, with "other factors" considered as appropriate. The same is true for the three factors used to evaluate local financial commitment.
Consistent with §5309(e)(6), summary ratings of "highly recommended," "recommended," or "not recommended" are assigned to each proposed project, based on the results of the review and evaluation of each of the criteria for project justification and local financial commitment. To assign these summary ratings, the individual ratings for each of the financial rating factors and project justification criteria are combined into overall "finance" and "justification" ratings, which in turn are combined to produce the summary ratings.
In evaluating the project justification criteria, FTA gives primary consideration to the measures for transit-supportive land use, cost effectiveness and mobility improvements to arrive at the combined "justification" rating. For local financial commitment, the measures for the proposed local share of capital costs and the strength of the capital and operating financing plans are the primary factors in determining the combined "finance" rating.
For a proposed project to be rated as "recommended," it must be rated at least "medium" in terms of both finance and justification. To be "highly recommended," a proposed project must be rated higher than "medium" for both finance and justification. Proposed projects not rated at least "medium" in both finance and justification will be rated as "not recommended."
These ratings are used both to approve entry into preliminary engineering and final design, as required under §5309(e)(6), and to recommend proposed projects for Federal funding commitments. A proposed project must receive a rating of at least "recommended" in order to be approved for any of these purposes.
The permanent approach FTA will use to assign these summary ratings is detailed in the regulation on project evaluation required by 49 USC §5309(e)(5). Due to the fact that FTA is still conducting outreach on the requirements of the Final Rule and developing guidance for project sponsors, and the fact that this report is intended by statute as an update of information contained in the Annual Report on New Starts, the project ratings contained in this report reflect an application of FTA’s existing project evaluation process, as published in the Federal Register on December 19, 1996 and amended on November 12, 1997 (61 FR 67093-106 & 62 FR 60756-58). The only significant change is that, due to the TEA-21 provision, the value of travel time savings is no longer reported for mobility improvements; instead, travel time savings is reported in terms of hours.
The results of the project evaluation process for the 12 projects included in this Report are shown in Table 1.
Appendix A provides a more detailed profile for each project which has completed the preliminary engineering stage of development, including a description, status, list of funding sources, map, and a presentation of the project evaluation criteria and ratings. Each of these profiles includes a summary description which highlights the overall project ratings and presents key descriptive, cost and ridership data for each proposed new starts project compared to the no-build alternative. Detailed profiles for those proposed projects that have completed alternatives analysis are included in Appendix B.
It is important to note that a rating of "recommended" does not translate directly into a funding recommendation in any given fiscal year. Rather, the overall project ratings are intended to reflect overall project merit. It is also important to note that the purpose of this Report is to update the status and ratings of those proposed projects that have recently completed alternatives analysis or preliminary engineering; this is not a budgetary document and does not alter the funding recommendations contained in the President's budget proposal to Congress.
1While not specified as a criterion in §5309(e)(1)(B), the clear emphasis placed on land use issues by both TEA-21 and the earlier Intermodal Surface Transportation Efficiency Act of 1991 (ISTEA) has led to the establishment of project justification criteria for transit-supportive existing land use policies and future patterns.
2TSM alternatives typically include elements such as traffic engineering and signalization, transit operational changes, and modest capital improvements.