Funding Deadlines: What do they mean?

There are 52 communities in the State of Tennessee that have populations between 5,000 and 50,000 that receive a “Small Cities” Surface Transportation Program (STP) balance from the Tennessee Department of Transportation (TDOT). The way that Congress sets up the funding through the most current Highway Bill, communities that receive this funding have a deadline to spend this money.

With the most recent Highway Bill, the deadline for obligating funds in September 30, 2014. But what does that really mean?

As I have said many times before the word “obligate” in the TDOT Local Programs world means something very specific. It means that you have a project set up with the TDOT Local Programs Office, a fully executed contract for that project, and most importantly, a Notice to Proceed for that specific phase of work has been issued. Funds are obligated for each phase of work, not all at once. You can’t have your funding for the Construction phase obligated until you complete all of the steps in the TDOT process.

Now back to the idea of funding deadlines. If a local government does not have their Small Cities STP funds obligated on a project by the September 30, 2014 deadline then they will disappear (the MPO funding deadlines are a little different). TDOT will not allow you to roll forward any balance. It is a use/lose proposition.

But does that mean that you have to actually spend the funds that have been obligated by the funding deadline? The answer is no. Once the funds have been obligated for a project, they are essentially taken off the table, and are about as safe as you can get (as long as you are submitting monthly reimbursement requests to TDOT). Funds that are obligated before the deadline, can be spent on the project after the deadline has passed.

Note: In every single TDOT Locally Managed contract, every project has a drop dead date (its on page two, section B.2). TDOT gives you about 4 years to complete your project. At that time the contract on the project expires. Technically you  could do a contract amendment to change that date further out, but you had better have a good reason to give TDOT for needing to do that. 

Now back to this idea of the September 30, 2014 deadline. It takes time to get contracts set up with TDOT. It takes time to get funds obligated with TDOT and the Federal Highway Administration (FHWA). Getting a project set up can take 4 to 6 months easily. Also keep in mind that TDOT has to start closing out it’s books with FHWA ahead of the deadline. That can complicate getting the funds for your project obligated the closer to the deadline that you get.

So if you think that you can wait until August or September to submit the paperwork for your project and you are ok…Well, I hate to break it to you but that is not the case.

It is my deepest hope that Congress has the wisdom to fully fund a comprehensive four year Highway Bill. That would put the next deadline at September 30, 2018. Considering how long it can take to get a project to Construction, my advice is to get going as early as possible on your project. Four years can sound like a lot. That is until you start looking at a calendar, mapping out schedules, and taking unforeseen project delay’s seriously.

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Important Funding Information

So you have gone through the whole TDOT Local Programs process for your project. You have the approved NEPA, your plans approved, all the certifications, a Notice to Proceed for Construction, and at long last, bid concurrence from TDOT.

Goodness knows how long this has taken you, and how much work you have had to put in to get to this point. This is where things can get very dangerous, very quickly. NOW is the time to check the math on your fund balance and make sure that there is enough funding to cover the project, and any contingencies that may come up in Construction.

Let me explain. Every project has two separate funding numbers to watch:

  1. #1 How much money has TDOT obligated for ALL phases (PE-NEPA, PE-Design, ROW, Construction) for the project? Is this the totality of what your community has available or are there additional funds (STP, Local, or other) that can be put on it?
  2. #2 How much money is the project going to cost (at this point)? To get this add the total contract amount (which should include PE-NEPA, PE-Design, ROW, and CEI) with your engineering firm, any materials testing that will be needed, plus the approved bid amount.

If the total amount for #2 is greater than #1 than you have a problem. That means that the local government will run out of TDOT funding and have to pay everything out of pocket after their funding balance runs out.

If the total amount for #2 less than but is very near to #1 than you need to watch any sort of cost overruns, or change orders closely. You could quickly run out of funding. TDOT is going to  be keeping a close eye on this as well.

Note, you can move obligated funding between phases of work. So lets say that TDOT obligated $40,000 for PE-NEPA, but your contract with your engineering firm is only for $20,000. The NEPA is completed, and your engineering firm has sent you all the bills for NEPA that they are going to send (and you have paid them and been reimbursed by TDOT). At that point you would want to ask the TDOT Local Programs Office to move the remaining $20,000 from the NEPA phase to the Construction phase.

The math on this may be fairly simple, but if you are only watching one of the two sets of numbers then you can get in very big trouble. You must keep an eye on both, and make sure that everyone (Consultants, TDOT, your Contractor, and most importantly the Local Government) understands them as well.

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“D List” Categorical Exclusion NEPA Documents

Up till now the only Environmental Documents that I have worked on are Programmatic Categorical Exclusion (PCE), or “C-List” Categorical Exclusions. Both of which take the same amount of effort and require the same information. I have gone into more detail on how this process works in previous postings.

Well, I have a few small Federally funded Bridge Replacement projects that I am getting NEPA documents for. Even though they are smaller bridges, TDOT is interpreting the guidance from FHWA to mean that they will need to be processed to the higher level “D-List” standard.

So what does this mean? Basically it means that one additional step is added to the process. With  a PCE or C-List once TDOT has signed off on it the NEPA document is complete and approved. You are done.

With a “D-List” you have to go through all the same things, but once TDOT signs off on it, it then gets sent to FHWA for approval and signature. Once FHWA signs off on it THEN your NEPA document is approved.

The final SDC document is set up a little different than the PCE/C-List document, but from the perspective of the person putting everything together all is the same. Be sure to contact Drew Gaskins at TDOT NEPA to make sure you have the correct form before filling it out.

If you have more questions please contact Drew, he will definitely be able to help you. If you are curious to find out more about D-List projects you can go to the FHWA website and find out more information.

I have been told that FHWA has 30 days to approve the D-List projects. Mine were sent over last week, so I will find out soon enough how long it actually takes….

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Another Updated TDOT Document

Just as I posted the updated SHPO 106 memo template it turns out that the SDC template has also been updated. This is the final NEPA document that you send in for signatures and approval after all of the Agency letters come back approved for your project.

You can find the new template here SDC, version 3, May 2014

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Updates with the TDOT NEPA Process

Change is the only constant, and TDOT like most organizations is always changing….

First off I would like to say goodbye and thank you to Scarlett Sharpe. Scarlett just moved out of state, but has been the anchor person and a HUGE help in getting the TDOT Environmental document process smoothed out over the past few years. I know that I am not alone in the Consultant community that has been deeply grateful for Scarlett’s help. We wish her the best as she moves on.

With that I would like to welcome Drew Gaskins to the TDOT Local Programs world. Drew, like me, is a consultant and has been brought in to replace Scarlett. I have had the chance to meet and work with Drew over the past several weeks and he is a real professional. Drew has been very helpful in the numerous NEPA documents that I am currently working on. Here is Drew’s information:

Drew Gaskins
Tennessee Department of Transportation
James K. Polk Building, Suite 900
Environmental Documentation Office
505 Deaderick Street
Nashville, Tennessee 37243-7120
Direct – 615-253-2475
Partnering with:
Gresham, Smith and Partners
Nashville City Center
511 Union Street, Ste. 1400
Nashville, Tennessee 37219-1710

While we are on the subject of change at TDOT this last week Holly Barnett of the TDOT Historical section has informed me that the format for the 106 memo that is used to request State Historical Preservation Office (SHPO) approvals has been changed. You can find the new form here Cultural Resources Local Programs Template, Updated SHPO Template, May 2014, and here is Holly’s information if you have any questions about it:

Holly Barnett | Historic Preservation Section | Environmental Division | TDOT
| 505 Deaderick Street| Suite 900 James K. Polk Building | Nashville, TN 37243 |615. 253. 2467
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The NEPA Process

Getting NEPA (the National Environmental Policy Act) approval for your project is one of those steps that can seem like a little bit of dark magic. People know that it takes time, money, and can be a huge headache and hold up projects.

What I want to do in this post is to help pull back the veil and show how this process actually works. There are a lot of misconceptions about what NEPA is, and is not and I want to hopefully do is help you understand the process, and the reasoning behind it.

Now I am going to focus specifically on what NEPA approval means for Locally Managed Project that are following the process outlined by the Tennessee Department of Transportation’s (TDOT) Local Programs (LP) Office. Even more specifically, I am going to focus on lower impact projects like resurfacing, signal timing upgrades, bridge replacements, intersection improvements and traffic signals. These types of projects still require a Categorical Exclusion (CE) or Programmatic Categorical Exclusion (PCE)  NEPA document even though their environmental impacts are minimal if any at all.

Environmental Impact Statements (EIS), Finding of No Significant Impact (FONSI), and Environmental Assessments (EA) are much more intense processes. I am not as familiar with them, so I won’t cover those approvals.

I can hear your first question already: Why do we have to do anything if there is no real environmental impact? The reason is simple: Because Congress says so. If there is a penny of Federal funding on a project, that project must have some sort of NEPA document. I am sure that this decision came about because of some bad actions in the past. The bottom line is that TDOT will not reimburse you for Construction expenses on your project unless you follow their process. Step one of their process is to get a NEPA document.

The following are the steps that your project must follow in order to get a NEPA CE or PCE approval:

  1. Receive your Notice to Proceed (NTP) for Preliminary Engineering-NEPA (PE-NEPA) from the TDOT Local Programs Office. Without this, the TDOT Environmental Office can’t even help you get started.
  2. Call Scarlett Sharpe of TDOT Environmental Division. Scarlett will be your single point of contact for the whole NEPA process. She is very helpful and will walk you through the whole process.
  3. Submit your completed project documents to Scarlett Sharpe. Basically there are three things that you must submit to Scarlett.
    -Your Agency Letters. These will get sent onto the US Army Corps of Engineers, the US Fish and Wildlife Service, the Tennessee Wildlife Resource Agency, the Tennessee Department of Environment and Conservation, Hazmat and Air/Noise approvals. If necessary the Indian Tribes, the US Coast Guard, or the US National Park Service will be sent letters for approval.
    -The Purpose and Need Statement for your Project. This document opens up the project for Scarlett and TDOT Environmental
    -The completed 106 memo. This is what will get submitted to the State Historic Preservation Office (SHPO) for their approval
  4. Receive Agency Approvals. This can be a bit of a waiting game. The Agencies deal only with TDOT. They do not want to talk with the Local Governments or their consultants directly. They send the approvals (or any questions) back to Scarlett, who forwards them onto you (the Local Government or consultant).
    Receiving approvals can happen as quickly as a few weeks, to as much as a few months.
  5. Submit the final Streamlined Documentation Checklist (SDC) to Scarlett Sharpe.  Basically you take all the previous information that you submitted, and roll in all the approvals and submit that. Once it is signed by Ann Andrews and Scarlett Sharpe of TDOT then you have your approved NEPA document.

Sounds easy enough right?

All of these things take time. There is only one Scarlett Sharpe at TDOT who is wading through a ton of projects at any given time. Getting all the information that she needs, in the format that she needs it in can take time. The information needed in the Purpose and Need Statement, the 106 memo, and the Agency letters are similar but not exactly the same, and are not in the same format. On one project you can get an Agency approval in 3 weeks, on the very next project it can take the same Agency 3 months to send approval. Then there is a lot of follow up that needs to be done to keep things moving forward.

That is why you will need to hire an engineering consulting firm to handle this for you. The learning curve is just too steep if you have never done one of these before.

Now for the bottom line. Plan on all of this to take 6 months to complete a PCE or CE. That is 6 months from NTP for PE-NEPA till the completed/signed/approved NEPA document. If the stars align and the timing is just so, it can happen a little quicker. If your project involves ROW, multiple phases, or some other complication it can take a couple months more.

I hope this helps explain the NEPA process for you. Please let me know if you have any questions to your specific project.


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A New Year-A Long Term Vision

It is hard to believe, but 2014 will be the eighth year of my career in Local Programs. Eight years of helping communities from one end of Tennessee to the other in getting their road, and bridge projects completed. It has certainly been a fun, but strange journey.

I know that I have talked about this issue before in various blog posts, but it is worth repeating: You must have a long term vision. 

Everyone: TDOT, Consultants, the general public, and especially the Local Government Officials, are frustrated by how long the process takes to complete a project. We could all rant and rave about this, but that would not solve the immediate issue of moving things forward. What I want to do instead is give you the information that you can use to plan out how long various parts of the project will actually take to get completed.

Below are a list of general guidelines on how long that you can expect certain activities to take to be accomplished. Please keep in mind that these are general guidelines based on what I have seen my most recent projects.

  • Time from when you send your chapter 3 information and contract request till when the TDOT Local Programs Office will send you a Locally Managed contract: 1-3 months (the TDOT Local Programs Office will probably want to conduct a “Staffing & Equipping” interview, which can take time to schedule)
  • Time from when you mail back the signed contract to the TDOT Local Programs Office, till when you get a fully executed contract and a Notice to Proceed (NTP) for the first phase of work (PE-NEPA): 2-3 months.
  • Time from issue of NTP for PE-NEPA till the Environmental Document is approved by TDOT and completed: 6 months minimum. 

    Now I need to be clear, the 6 month estimate is how long it would take for a simple Categorical Exclusion (CE) or Programmatic Categorical Exclusion (PCE). These are projects with a minimum of dirt being moved and a minimal environmental impact, if any.

    Other environmental documents include: a Finding of No Significant Impact (FONSI), an Environmental Assessment (EA), or an Environmental Impact Statement (EIS). These approvals are necessary if there are environmental impacts greater than what can be covered in a CE or PCE document. In this case all bets are off and you need to think in terms of years, not months, to get these approvals.

  • Time from issuance of the PE-Final Design NTP to the issuance of the ROW NTP: 1-3 months (depending on the project)
  • Time from the issuance of the ROW NTP to the issuance of the Construction NTP: 2-4 months (again depending on the complexity of the project, and it can take longer).

Each project has it’s own story, and is like a work of Art: unique in it’s own special ways. The numbers above are intended as general guidelines for planning. By doing the math you can see that I estimate that even a small and relatively simple project will take about a year from NTP for PE-NEPA till NTP for Construction. Can it be done in less time with the current constraints? Yes, but only if maximum effort is given, and it is still dependant on a certain amount of luck. For projects with any level of complexity beyond simple resurfacing within the existing right of way (ROW), things will take longer.

As I wrote in the beginning of this post: You need to have a long term vision for what you want to do. Both patience, and persistence are required not just in completing the project that you already have in the works, but also in mapping out the next project that you want to develop.

I hope that this posting has been helpful. Please feel free to give me a call if you have a question about your specific project. Happy New Year and good luck!

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