FTA Letter of No Prejudice
Third Party Procurement
Frequently Asked Questions
Q = Question; A = Answer
Q. A bus manufacturer requested a letter of intent for the purchase of several hybrid vehicles. We are willing to issue a non-binding letter of intent, however our funding has not yet been approved by FTA for this procurement. Do we need to request FTA to issue a Letter of No Prejudice? How does this work?
A. As long as you do not contractually obligate yourself to purchase the vehicles, you will not need a Letter of No Prejudice from FTA. Thus you may issue a non-binding Letter of Intent to the manufacturer and you will not jeopardize the eligibility of the grant funds. However, if the manufacturer insists on a contractually binding letter from you, you will need to obtain a Letter of No Prejudice from FTA before issuing the letter to the manufacturer. FTA has developed guidance on Letters of No Prejudice here. (Revised: September 1, 2009)