by Julie Hoover

ISTEA Planners Workbook

Major investment projects merit priority attention from transportation professionals and citizen groups because they involve the expenditure of large sums of money, typically tens of millions of dollars, and can significantly affect mobility and quality-of-life in metropolitan areas.

ISTEA and the Clean Air Act Amendments triggered the need for new major transportation investment planning procedures, which were defined in a preliminary way in the FHWA/FTA Final Rule on Statewide and Metropolitan Planning (Final Rule) issued in the Federal Register on October 28, 1993. Further guidance has been offered in FHWA/FTA seminars held across the country and in a subsequent summary of key questions and answers.

This new corridor planning process, which was conceived to improve transportation investment decisions, came to be called a "Major Investment Study," or MIS. (It was originally characterized as a "Major Investment Analysis" but the corresponding acronym-MIA-was perceived to have a pejorative connotation so the name was changed.)

Major investment studies are required when an agency identifies the potential need for both a major investment and federal funds. Their primary purposes are to provide information about the likely impacts and consequences of alternative transportation investment strategies, and to assist the MPO in adopting the strategy to be implemented as part of its long range plan. A strategy refers to the design concept and scope of a project, and may also include operational and policy (land use, parking availability and pricing, transportation demand management, etc.) components as well as a financial component.

A major investment is officially described as a "high type highway or transit improvement of substantial cost that is expected to have a significant effect on capacity, traffic flow, level of service, or mode share at the transportation corridor or sub-scale area." Examples include but are not limited to: a new, partially controlled principal arterial; extension of a partially controlled principal arterial (one or more miles); capacity expansion equivalent to one or more lanes on a partially controlled principal arterial; construction or extension of an HOV facility or fixed guideway transit facility; addition of lanes or tracks to a fixed guideway; and substantial increase of transit service on a guideway.

HOW CITIZENS SHOULD BE INVOLVED

Citizens concerned about transportation risk burn out as they are faced with an increasing array of involvement opportunities at state, MPO, and project levels. Not all are equal, of course, for there is broad variation in the intent and responsiveness of the various planning sponsors, the intensity of participation solicited, and the relevant importance of the issues addressed. All things being equal, citizens should take special notice of MISs because the stakes in this arena are so high. To be most effective, make your views known at both federal and local levels.

FHWA Meets FTA to Craft a Common Planning Process: for the past two decades, planning for highway and transit major capital investments has evolved differently.

In general, planning requirements for transit investments have been much more rigorous. Project sponsors had to prepare an Alternatives Analysis/Draft Environmental Impact Statement (AA/DEIS) before preliminary engineering, which involved close scrutiny of alternative modes and alignments, a 15-year planning horizon, a financial planning assessment, and cost-effectiveness analyses. Additionally, project sponsors had to obtain federal approval before even embarking on an AA/DEIS. Finally, there was a "one corridor at a time" restriction and a policy of "overmatch," whereby localities which pledged more than minimum local funding were given federal priority.

In contrast, highway investments proceeded in a relatively laissez-faire environment, enjoying an absence of federal approvals to initiate planning studies and limited federal overview of planning products, no corridor restrictions, and a 20-year planning horizon. Financial considerations and cost-effectiveness requirements were non-existent and formal EISs were postponed until preliminary engineering.

In ISTEA, Congress instructed FHWA and FTA to conform their environmental procedures. This provided some of the impetus for developing an integrated planning process. Other ISTEA and Clean Air provisions came into play as the full implications of the reauthorization bill were realized including flexible funding, CAAA requirements for detailed plans, and ISTEA's emphasis on intermodalism.

Who Can Officially Sponsor an MIS: only government agencies. These include state DOTs, MPOs, transit properties, commuter rail and railroad agencies, transportation authorities, and city and county governments.

MISs Feature Interagency Agreements, Public Involvement, and Comprehensiveness: an MIS is a thorough assessment of alternatives in a corridor or subarea. In some respects, it is similar to FTA's former Alternatives Analysis process, although sponsors have the option of deferring the Draft Environmental Impact Statement to the next phase of project development (see following section), a 20-year time horizon prevails, the level of federal oversight is reduced, and there are other minor differences. The MIS must conform to federal regulations and guidance. Key elements include:

• An initial interagency meeting (or meetings) to determine the extent of the MIS. Participants must include: the state DOT; the MPO; relevant transit agencies; environmental resource and permit agencies; affected local officials; the FHWA; FTA; operators of other major modes of transportation; and, where appropriate, community development agencies, major governmental housing bodies, and other related agencies that may be affected by the proposed scope of the analysis. Participation of citizen groups is not mandatory in this formal negotiating process, but is not prohibited either. Some type of public involvement must be conducted during the period.
• It is critical for the sponsoring agency to have a clear statement of purpose and need at these meetings so participants can adequately assess whether the alternatives adequately respond to the corridor's transportation problems. Indeed, the statement itself should be subject to review, especially from the perspective of its comprehensiveness. Another key issue is the level of detail to be addressed in the MIS.
• Any agreements reached should be set down in writing. Denver, which has already gone through the process, has fallen back on their written agreements several times.
  
• A proactive public involvement program initiated early in the process.
  
• Consideration of all reasonable alternatives. While sponsors do not have to waste time studying unrealistic options, all rational solutions to the corridor's transportation problems must be addressed. This represents a fairly significant change for highway project sponsors.
  
• Demand forecasting that includes the level of usage, the basis for the estimation of benefits and costs, freight movement as well as person trips, impact on other facilities, and input to other impact assessments.
  

Assessments of alternatives to the extent needed to answer community concerns and arrive at a defensible Locally Preferred Alternative. Impact assessments should cover:

• mobility, including needs of the transit-dependent population;
• social, economic, air quality, other environmental, energy concerns;
• operating efficiency and safety;
• land use and economic development;
• goods movement/safety; and
• a financial assessment.

Both direct and indirect impacts must be considered. Assessments should be conducted to the extent needed to identify and evaluate all of the significant differences among the alternatives under consideration, to find fatal flaws, to identify the views of interested parties, and to get some handle on mitigation costs. At present, there is a fair amount of confusion regarding appropriate levels of detail in each area and a manual on MIS preparation is being developed.

The assessments are ultimately incorporated into an evaluation procedure that includes a systematic analysis of expected benefits and costs using both quantitative and qualitative measures consistent with Executive Order 12893 on Principles of Federal Infrastructure Investments.

• Cost estimating that includes capital, operating, and maintenance costs.
• Optional DEIS. (See below.)
• Quality control procedures and processes, including methods to ensure data and analytical quality such as independent peer reviews and fully open public involvement processes.
  

In addition, sponsors of transit proposals seeking Section 3 money must respond to FTA's project justification and financial criteria; both transit and highway sponsors seeking discretionary money must also comply with the evaluation criteria of relevant Congressional committees.

Dealing with NEPA: the Final Rule offers two options for responding to NEPA's EIS requirements:

Option 1 permits the sponsoring agency to defer the EIS document until the later, preliminary engineering phase. The MIS narrows the range of investment alternatives to one design concept and scope (although more detailed design options may still exist). It provides information for subsequent NEPA documents, including sufficient material to support elimination of alternative investment strategies. This is modeled after FHWA's former planning process.

Option 2, replicating FTA's pre-ISTEA project planning, incorporates a DEIS or Environmental Assessment (EA) into the Alternatives Analysis (now called MIS).

Some federal officials privately predicted that projects which were either very simple or very complex would adopt Option 2, and the remainder would choose Option 1. Their rationale was that sponsors of easily-implementable projects would want to get the environmental requirements over early so they could quickly move into implementation. Sponsors of controversial projects, on the other hand, would have to do a great deal of environmental analysis in the MIS anyway, and might as well go the few extra steps and comply with EIS documentation requirements.

Option 2 involves some additional up-front time and cost because the full environmental and engineering impacts of all alternatives have to be officially documented on an equal basis. Also, supplemental EISs may be required if the project changes as it moves through preliminary design. On the other hand, some argue that this approach develops a more defensible basis for the elimination of alternatives and the selection of one, and dispenses of the need to repeat environmental and community reviews.

To date, most transit MIS sponsors seem be choosing Option 1 while sponsors oriented more to highway facilities appear to favor Option 2.

Linkages to Other ISTEA Activities: MISs must be closely integrated with other elements of the ISTEA planning process as well as related requirements such as conformity analysis. The flow chart shown in Figure 2 illustrates how MISs will fit into the rather complicated web of new planning activities.

The focal point of major investment planning is the MPO because all MISs must be included in both their long range transportation plan and their TIP.

A major source of input to plan and TIP development will be the measures and strategies produced from the management systems, especially the Congestion Management System (CMS). If an area does not yet have a CMS in place, is a Transportation Management Area, and is contemplating additional single occupancy vehicle (SOV) capacity, a special congestion analysis called an "SOV Project Analysis" must accompany any new MIS. Other key inputs include the results of policy studies where available; environmental, land use studies, and other technical studies; and, of course, contributions from stakeholders and the public.

MISs may be conducted as part of the plan preparation or update process. Projects which emerge from this process are then evaluated and prioritized. Those adopted move forward if they pass the stringent test of EPA conformity analysis in non-attainment areas. They are placed in the MPO's plan and TIP and the state TIP, all of which must be financially-constrained. The NEPA process is then completed and if all environmental requirements are met, the project advances into implementation.

Ideally, the results of MISs will be available in time for inclusion in the MPO's plan. Until the dust settles and all MPOs have effective planning processes in place, this will not always be the case. Being out of synch is not a fatal flaw, however, because a "place holder" may be assumed and included in the plan. This may be either a "No Build" or a "most promising" alternative. Inclusion of this assumed project allows a conformity determination and financial constraint test to be applied to the project. Once the MIS is completed, the plan will have to be amended to include the selected strategy.

Grandfather Provisions: the MIS requirements do not apply to projects where the environmental process has been completed and a Record of Decision (ROD) or Finding of No Significant Impact (FONSI) has been signed.

For studies underway but not completed, sponsoring agencies need, at a minimum, to consult with FTA, FHWA, the state DOT, transit operators, and the MPO to determine the need to revise the study scope. Consideration will be given to:

• Nearness of the study to completion;
• Whether a reasonable range of alternatives was considered and analyzed
• in the original study scope;
• Whether the study will produce sufficient information to fully evaluate
• investment strategies; and
• The need for enhanced public involvement.
  

Major Investment Projects Can be Funded in Numerous Ways: a wide variety of funding programs are available to support both the planning and implementation of major capital transportation investments as a result of ISTEA.

Planning, if it is included in the Unified Work Program and the TIP and STIP for programming purposes, can be funded by CMAQ, STP, NHS, or other capital funds administered by FHWA. Some planning funds are also earmarked. It is generally recognized that planning funds are insufficient to support MISs, and that project money needs to be used and is eligible.

For implementation, transit and commuter rail projects can draw upon their Section 9 and 18 allocations as well as compete for discretionary Section 3 funds. Additional programs containing flexible funds which may be transferred to transit include the Surface Transportation Program (STP), the National Highway System (NHS), the Congestion Mitigation and Air Quality program (CMAQ) in non-attainment areas, and several others.

Major highway projects will normally be funded from apportionments for the NHS, STP, Interstate Transfer Program, Minimum Allocation, Donor Bonus, 90% Adjustment, or Hold Harmless categories. Transit Section 9 funds in Transportation Management Areas may also be transferred to highways.

New Federal Roles: Less Ongoing Oversight but New Certification Power: FHWA/FTA see their role in MISs as "partners" rather than "police." For transit projects, this is a significant change from the past, which was characterized by intensive federal oversight and review at each major milestone.

A large portion of future quality control will be provided by peer reviews, which FHWA/FTA are urging in several technical areas. Other quality checks are expected to come from the dynamic of transit agency/state/MPO partnerships, because it is alleged that each agency will keep tabs on the others, a premise which elicits skepticism from some observers. FTA or FHWA will do selective reviews, although there are staff constraints, especially within FTA. Both agencies do need to be consulted, however, as part of the initial MIS consultation process. Projects advancing under NEPA Option 2 will have more federal oversight because FHWA or FTA must be a sponsor of the document.

Additionally, ISTEA breaks precedent with the past 12 years by mandating federal- (rather than self-) certifications of all planning processes in a region. The first cycle will begin this year.

FHWA/FTA must certify MPOs every three years and these reviews will include MISs. Guidelines on certification are currently under development and pilot programs are being conducted over the summer, with citizen participation, MISs, and MPO planning constituting three of five areas investigated. FTA Deputy Administrator (and former STPP Director) Grace Crunican is advocating the use of citizens as part of certification, not just of the citizen participation programs, but of the entire planning processes. In any event, federal officials assure they will definitely seek consultation of major actors beyond the process and project sponsors.

Blueprint for Better Planning or a Burdensome Federal Requirement: for the vast majority of STPP readers, the evolving MIS requirements are a significant change for the better.

A primary benefit of the new planning approach is a level playing field for highways and transit. It also establishes the framework for evaluating highway and transit alternatives against each other. Moreover, it creates the opportunity to develop multimodal strategies encompassing highway and transit solutions.

Another advantage is the significant impetus it creates to bring major investment projects into the fold of comprehensive regional planning, thereby strengthening the role of the MPO. It is also hoped the procedures will spark greater cooperation among state, MPO, and transit agencies.

Other benefits include assessment of a broader range of alternatives; earlier consideration (before a decision is made) in FHWA-sponsored projects of social, economic, and environmental effects; a 20-year target for FTA-sponsored projects, allowing more time to realize transit's long-term benefits; elimination of FTA's onerous "one corridor" requirement and project initiation threshold tests; and the potential for more uniform, meaningful public involvement.

There are some, of course, anxious to get on with building their projects in the face of mounting congestion, who deplore the delays (real and perceived) that will be caused by the new expanded studies. Others are hostile to the notion of any additional federal planning requirements and/or fearful, especially since so many procedures are still undefined.

It is unfortunate that it has taken FHWA and FTA so long to agree on even the skeleton procedures we currently have, and while their travelling seminars were immensely useful, everyone-including those unable to attend the introductory sessions-believe written guidance is sorely needed.

An additional shortcoming is the absence of practitioner and public input to the development of the guidance to date, except for comments received on the Notice of Proposed Rulemaking on Metropolitan Planning issued in March 1993, which only addressed the basic concept of MISs and a few key issues. While there is no formal requirement for public participation in the development of federal guidance, the voluntary provision of opportunities to comment would be in keeping with the spirit of ISTEA.

Further, there are many questions about how NEPA Option 1 will play out. Will public officials and citizens be put through two extensive involvement processes for the same project? If there is extensive citizen participation during the MIS, will public interest fall off when NEPA begins, thus reducing outside scrutiny of project development during a critical phase? Although federal officials in Washington assure that MISs will produce environmental and community impact information to the degree necessary to respond to all public concerns, will this really be the case? The budgets of some forthcoming MISs suggest otherwise. What happens if new alternatives are discovered during NEPA, or if analyses used to dismiss alternatives previously considered are found to be inadequate? Might project development then take more, rather than less, time? Answers will be evolve over the next year or two as MISs advance through the new regulations.

Finally, many have concern about the numerous outstanding MIS-related issues, and hope they will be resolved in the very near future.

In spite of these concerns, overall MIS requirements are headed generally in the right direction. Who can really argue against spending a bit more time and effort to do good comprehensive, participatory planning before spending tens or hundreds of millions of dollars on a new transportation facility?

Forthcoming Federal Guidance and Assistance

There will be significant changes to MIS procedures over the coming year as federal officials issue additional regulations and guidance that fine-tune and expand upon existing requirements. Interested professionals and citizens should make their views known at every opportunity. Future modifications include:

• A new FTA Major Capital Investment Policy to formally address the wide range of Section 3 New Start project investment criteria called for in ISTEA, expected during the 1994 Fiscal Year. These include, in addition to cost-effectiveness, mobility improvements, environmental benefits, operating efficiencies, and other factors such as land use and economic development.
  
• A Notice of Proposed Rulemaking (NPRM) on joint FHWA/FTA environmental procedures is scheduled for release in late 1994. This NPRM will reflect the new MIS requirements as well as corridor preservation guidelines. When finalized, this rule will replace the 1987 joint regulations.
  
• A senior FHWA official has indicated there will be more future guidance on public involvement, building on actual practice and comments obtained.
  
• Some type of document describing how certification will be conducted and what specific evaluation criteria will be used has been promised by various Administration officials, although no availability date has been set.
• Case studies of "best practices" for major investment planning sponsored by FHWA/FTA will be out before the end of the year. Other case studies and additional multimodal planning research projects are being sponsored by the National Cooperative Highway Research Program, although they will not be available for some time.
  
• An MIS manual and a three-day training course will be available by the end of the year. Two pilot courses will be conducted in 1994 and at least 12 taught over the next two years. Both are sponsored by the National Transit Institute with participation by FTA and FHWA.

Suggested Federal Actions:

Support current federal efforts to obtain citizen involvement in certification by suggesting ways this could rationally be accomplished, participating in certification reviews in your area, etc.

• Comment on Notices of Proposed Rulemaking such as the forthcoming one on joint environmental procedures.

• Comment on open nonregulatory federal dockets soliciting observations and suggestions on public involvement and MIS procedures.

• Assess existing procedures and lobby for improvement where necessary.

• Ask to attend one of the National Transit Institute's MIS training programs if you or your group have the time and resources to make such a commitment. The knowledge you will acquire in this course will help put you on an equal footing with the professionals.

Specific Local MIS Actions:

• Be actively involved in the initial meetings for all MISs in your areas. Make sure the study scopes include a full range of alternatives and address all relevant issues. Review carefully the project's purpose and need statement and project evaluation criteria; call on regional federal officials if you sense a problem. If the MPO is proceeding under grandfather provisions, add your views to the assessment of the adequacy of prior citizen participation efforts, as well as the other key issue areas. Urge your MPO to include citizens in the official meetings. If this is not possible, remind them that federal regulations call for some sort of public input in this initial stage. Think about the pros and cons of the NEPA options, and make your views known.

• Participate actively in whatever program is developed. Work to get other potentially concerned individuals and groups involved, and try to establish constructive working relationships with the project sponsors. If necessary, remind local officials that ISTEA regulations call for "complete information, timely public notice, and full public access to key decisions," as well as early and continuing involvement of the public. Special efforts must be made to obtain participation of those traditionally underserved by existing transportation systems, including low income and minority households. A Response-to-Comments record should be maintained and MPOs must periodically monitor effectiveness.

• Take advantage of opportunities to participate in the selection of a preferred alternative.

• Testify at meetings and hearings and lobby the elected officials of your MPO.

• If the Locally Preferred Alternative is a project you favor, you can often be very effective in assisting the project sponsor in its implementation.

• Work within the MPO planning process to promote future MISs you feel will advance your vision for your region.