The President's budget for FY 2003 proposes that $1,214.40 million be made available for New Starts under §5309. This represents the full amount of guaranteed funds authorized by TEA-21. After subtracting amounts for FTA oversight activities proposed in the budget and approved by P.L. 107-87 , and for other purposes specified by §5309(m)(5)(A);  a total of $1,191.96 million remains available for projects. Of this amount, a total of $1,026.86 million will be allocated among 25 projects with existing Federal commitments. An additional $79.10 million will be allocated among two projects for which funding commitments are currently pending, and $55 million will be allocated among two projects that are expected to be ready for funding commitments before the end of FY 2003 (i.e., September 30, 2003). In addition, $31 million will be allocated to five meritorious projects in earlier stages of development. Complete descriptions of these projects can be found in Appendix A.
Table 2 summarizes the recommendations for FY 2003 funding and overall funding commitments. For each project, the first column indicates the overall project rating, as described earlier in this report. The second column shows the amount of FY 2001 and prior year funds that have been obligated by each project. The third column shows the amount of funds available as a result of the FY 2002 DOT Appropriations Act (adjusted for the oversight takedown). The fourth column shows the FY 2003 funding recommendations contained in the President’s budget request, and the fifth indicates the maximum amount of outyear funding remaining for those projects under FFGAs. Finally, the last column sums the first five columns and shows the total amount to be made available over the life of the project from Federal transit New Starts funds.
Section 5309(e)(7) specifies the Full Funding Grant Agreement (FFGA) as the means by which New Starts projects are to be funded. The FFGA is also the principal means used by FTA to manage the New Starts caseload. FTA also has the discretion to use an FFGA in awarding Federal assistance for other major capital projects.
The FFGA defines the project, including cost and schedule; commits to a maximum level of Federal financial assistance (subject to appropriation); establishes the terms and conditions of Federal financial participation; covers the period of time for completion of the project; and helps to manage the project in accordance with Federal law. The FFGA assures the grantee of predictable Federal financial support for the project (subject to appropriation) while placing a ceiling on the amount of that Federal support.
An FFGA also limits the exposure of FTA and the Federal government to cost increases that may result if project design, engineering and/or project management is not adequately performed at the local level. FTA is not directly involved in the design and construction of New Starts projects. While FTA is responsible for ensuring that planning projections are based on realistic assumptions and that design and construction follow acceptable industry procedures, it is the responsibility of project sponsors to ensure that proper project management, design and engineering have been performed.
Additional information and guidance on developing FFGAs is contained in FTA Circular C 5200.1, Full Funding Grant Agreements Guidance, dated July 2, 1993, and the FTA Rule on Project Management Oversight (49 CFR Part 633).
 Section 319 of P.L. 107-87, Department of Transportation and Related Agencies Appropriations Act, 2002, states that, “beginning in fiscal year 2002 and thereafter, the Secretary may use up to 1 percent of the amounts made available to carry out 49 USC 5309 for oversight activities under 49 USC 5327.”
 Section 3009(g) of TEA-21 requires that $10.4 million in §5309 New Starts funds be set aside annually for ferry capital projects in Alaska or Hawaii; after accounting for oversight activities under §5327, $10.30 million is available for these projects.