Q = Question; A = Answer
A. FTA Circular 9030.1D, “Urbanized Area Formula Program: Program Guidance and Application Instructions,” dated May 1, 2010, lists the service life of vehicles purchased with FTA funds. Vans and other light-duty vehicles have a service life of four years or 100,000 miles, whichever occurs first. See, Chapter III, Subparagraph 4.a(2)(e). FTA does not assign a specific service life to used vehicles. If, however, a grantee purchased a van with more than 100,000 miles at a fair market value of less than $5,000, FTA would not assert a Federal interest in that vehicle. See, DOT Common Grant Rules at 49 C.F.R. § 18.32(e)(1) and 49 C.F.R. § 19.34(g). (Revised: July, 2010)
A. While title to FTA assisted equipment generally vests in the grantee that acquires the equipment (see, DOT’s Common Grant Rules at 49 C.F.R. § 18.32(e)(1) and 49 C.F.R. § 19.34(a)), ownership of title to the equipment can be negotiated between the two agencies involved in this project or the title to the equipment can be jointly owned, provided that FTA’s interest in that property is protected and Federal requirements are fulfilled. The real issue is in the definition of the "Federal Project" for which these funds are being used.
If the "Federal Project" involves the entire bus stop enhancement program, including construction of improvements and amenities such as benches, shelters, trashcans, etc., then the entire project is subject to Federal requirements regardless of which entity buys or owns the assets. This means that all of the procurements must be in compliance with Federal requirements described in FTA Circular 4220.1F regardless of which agency conducts those procurements and regardless of whose funds are spent for any particular item. This also means that any asset constructed or procured for this project must be retained in public transportation use for the useful life of that asset and the fair market value of that asset depreciates to less than $5,000. Requirements concerning project property are included in the "Master Agreement" incorporated by reference and made part of the underlying grant with FTA and apply to all property acquired for this project.
Finally, we would note that FTA's requirements regarding "revenue contracts" would apply to any such contracts involving the assets of this program, such as advertising on the shelters, etc.
FTA's latest policy statement on revenue contracts may be found in Chapter II, paragraph 2.b(4) of FTA Circular 4220.1F, “Third Party Contracting Guidance,” November 1, 2008.
If there is any question as to what should be the proper definition of the "Federal Project" for purposes of this enhancement program and thus the applicability of Federal requirements discussed here, you should contact your FTA grant representative for a decision. (Revised: July, 2010)
A. Since the agency you are dealing with is a public agency and your agency is the only direct recipient (or direct grantee) of FTA funding, the other agency will likely be recognized as your subrecipient (or subgrantee), you will probably use a subagreement (or subgrant) to transfer these funds to that agency which will in turn be responsible for the procurement of the improvements. See, definitions of “subgrant” and “subgrantee” in the DOT Common Rule for Governmental Grantees at 49 C.F.R. § 18.3. The subgrantee’s procurements must comply with the Federal requirements described in FTA Circular 4220.1F. Your agency’s subagreement (subgrant) with your subrecipient (subgrantee) should impose this Circular as a requirement with respect to the actual procurement procedures to be used and should designate that agency responsible for performing any contract audits that may be required by the terms of its procurement contracts in connection with the project.
FTA does not require your agency to keep a duplicate set of contract file documents, but your agency should know where to access those documents; if your agency does not keep the contract documents, the agency conducting the procurement must keep the documents in its files to demonstrate compliance with the Federal requirements described in FTA Circular 4220.1F. With respect to reimbursing your subrecipient, the most prudent method would be to your subrecipient at regular intervals for costs it incurs for eligible project costs. What constitutes "reimbursable costs" will have to be negotiated between your respective agencies, although be aware that FTA funds cannot be used to reimburse cost that would be ineligible under applicable Federal laws, regulations, or cost principles. (Revised: July, 2010)
A. Federal procurement requirements are not limited to the Federal share of a federally assisted project. Federal requirements, including all applicable procurement requirements, apply to project activities supported in part by Federal assistance. If the local organization is authorized to procure on behalf of the grantee, then the local organization is expected to follow the same requirements as would apply to the grantee itself. (Revised: July, 2010)
A. The situation you have described is an intergovernmental agreement between two public entities, not a “procurement.” Therefore, the competition requirements of FTA Circular 4220.1F are inapplicable. (Reviewed: July, 2010)