Advance Leadership Academy Highway Project in a Day Programming and Funding

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Advance Leadership AcademyHighway Project in a
DayProgramming and Funding

• July 16, 2009

Ron Rigney, P.E. P.L.S. Director Division of
Program Management
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Project Funding

• What are the various functions of the KYTC
  Division of Program Management?
• What is the KYTC Six-Year Highway Plan (SYP)?
• What is the KYTC Statewide Transportation
  Improvement Plan (STIP)?
• What are the different funding sources for KYTC
  projects?
• What determines the source of project funding?
• Who requests funding for a project that is
  identified within the Six-Year Highway Plan?
• What is a TC-10?
• What is a PR-1?
• What is the meaning of authorization of funding?
• What is the meaning of obligation of funding?
• What is the meaning of project budget amount?
• What is the meaning of project encumbrances?
• What is the meaning of project expenditures?
• What is the meaning of remaining available
  budget?
• When does project funding actually become
  available to cover project expenditures?
• If a project is identified within the SYP, why
  does the project manager have to request project
  funding?
• Why does the project manager have to provide
  projected monthly expenditures of the requested
  funds?
• What tools are available for project managers to
  use in preparing projected monthly project
  expenditures?
• Is it better to under estimate or better to over
  estimate the projected monthly project
  expenditures?

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The Division of Program Management is responsible
for preparing the programming documents for
authorization of state and federal funding for
the Preliminary Engineering (PE) and
Environmental, Design, Right-of-Way, Utility, and
Construction phases of KYTC projects.
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KYTC transportation roadway projects are funded
through different programs within the Cabinet,
and the type of funding used depends upon the
program in which the project activity is
conducted.
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As an example, the Department of Governmental
Relations, Office of Rural and Secondary Roads
allocates state funding for the following
programs The Rural Secondary Program
allocates by formula approximately 110 million
per year of funding to the 120 Kentucky
counties. The County Road Aid Co-op Program
allocates by formula approximately 92 million
per year to the 120 Kentucky counties. The
Municipal Aid Co-op Program allocates by formula
approximately 38 million per year to the 421
incorporated cities and 46 unincorporated urban
places throughout Kentucky.
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In addition, approximately 280 million per year
of state funding is provided through the Division
of Maintenance and the Division of Traffic
Operations for normal maintenance and operations
of existing roadways throughout the entire
Commonwealth of Kentucky.
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In addition to these KYTC programs, KYTC has
projects funded through the state road fund
(FD04) and through the federal transportation
funding (FD52) programs. The projects funded
through the FD04 and FD52 programs must come
through the Six-Year Highway Plan (SYP) process
approved by the Kentucky General Assembly. The
projected fiscal year amount of funding available
for the FD04 program is approximately 200
million per year, and approximately 650 million
per year through the FD52 federal program.
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The 2009 General Assembly approved the sale of
400 million of state bonds and the sale of 231
million of GARVEE bonds. The 2009 state bonds
will be used to fund KYTC roadway projects in the
2008 Highway Plan as identified by the 2009
General Assembly. The 231 million of GARVEE
bonds will be used for phases of the Louisville
Ohio River Bridges project in the 2008 Highway
Plan as approved by the 2009 General Assembly.
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Recovery Act Funding

• 421 Million
• Statewide (368 Million)
• Transportation Enhancement (TE) (12.6 Million)
• MPO Dedicated (40.6 Million)
• Cincinnati - 8,761,860
• Evansville - 831,184
• Lexington/Fayette - 7,845,004
• Louisville - 23,149,098

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Recovery Act Projects

• Statewide projects Identified within 2009
  Six-Year Highway Plan by the General Assembly
• TE projects 2008 application process
• MPO dedicated projects Projects selected within
  the MPOs by local committee members

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Recovery Act Requirements
 
 

• ARRA Important Dates
• February 17, 2009 ARRA enacted.
• March 3, 2009 120 days for 50 obligation
  requirements begin.
• June 30, 2009 Before this date 50 of the
  apportioned funds must be obligated (148
  million). Any portion that is not, will be
  redistributed to other states. Cut-off date is
  June 29, 2009 at 1159 PM.
• March 2, 2010 - One year after apportionment, by
  March 1, 2010 at 1159 PM, all Recovery Act
  funding must be obligated.
• September 30, 2010 Recovery Act funding
  released from one project can be obligated on
  other projects.
• September 30, 2015 Obligated balances are
  available for reimbursement of project
  expenditures. Any remaining Recovery Act funding
  balances will be withdrawn and will not be
  available for reimbursements.
• Date PR-1 is signed Reporting requirements
  begin and continue until project is closed in
  FMIS.
• By 7th day of each month LPA to submit FHWA
  1589 and FHWA 1585 forms to KYTC.

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Kentucky Highway Plan
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KYTC submits to the General Assembly in February
of even number years a Recommended Highway Plan
containing a listing of proposed projects
including the scheduled project phases, proposed
type of funding, scheduled fiscal year, and the
estimated cost of the corresponding project phase.
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The General Assembly reviews the projects
identified in the Recommended SYP, and they may
make revisions to projects, they may add
projects, and they may even remove projects
before they approve the SYP. Approval of the
SYP normally is in April of even number years and
also depends upon approval of the state budget by
the General Assembly.
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The Enacted SYP is the state document that by law
as outlined within KRS, the Transportation
Cabinet can proceed with the identified project
phases scheduled within the next biennium
depending upon the availability of identified
funding for each project.
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Federal-Aid Highway Program Funding
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The federal-aid highway program funding is in
accordance with the current federal
transportation act, Safe, Accountable, Flexible,
Efficient Transportation Equity Act A Legacy
for Users (SAFETEA-LU). The federal-aid highway
program is funded through the Highway Trust Fund.
The revenues of the Highway Trust Fund is from
taxes on motor fuels and truck related user taxes.
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Legislative approval by Congress for SAFETEA-LU
was signed into law by President Bush on August
10, 2005.Normally, a transportation act covers
a period of six years, but SAFETEA-LU only covers
five years FY 2005 through FY 2009. With
SAFETEA-LU scheduled to expire at the end of FY
2009 (October 1, 2009), preliminary work has
begun on the next transportation act.
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The federal-aid highway program is not a grant
program.The federal-aid highway program is a
reimbursement program, which means project
expenditures must be paid first with state funds,
and then the state sends requests to FHWA for
reimbursement of eligible costs.
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KYTC submits a weekly federal billing to FHWA
requesting reimbursement of federal funds, and
the turn-around time to receive reimbursement
normally runs 6 to 10 days.
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• FHWA has notified the states that the Highway
  Trust Fund is reaching a point that they may not
  have sufficient available federal-aid funding to
  reimburse states their requested federal-aid
  funding.

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• What effects may this have on the Transportation
  Cabinet?
• The timeline to finance the federal-aid projects
  with state funding may increase.The delay in
  receiving federal-aid funding reimbursements may
  further delay the start of state funded
  projects.Depending upon the duration of
  Congress delaying legislative action addressing
  the shortfall in the Highway Trust Fund, the
  start of new federal-aid funded projects may be
  delayed.

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• In tracking the Federal-Aid Highway Program
  funding, we normally break down the federal-aid
  into the following three (3) general types of
  funds
• Formula Funds
• Non-Formula Funds
• Discretionary Funds

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Formula Funds - the distribution of federal
funds using a formula provided in law and the
distribution of funds is called apportionments.
The Formula Funds apportionments are broken
down into various federal funding categories,
such as the following core programs Interstate
Maintenance (IM), National Highway (NH), Bridge
(BR), Congestion Mitigation (CM), Safety (SAF),
and Surface Transportation (STP). The Bridge,
Safety, and Surface Transportation core programs
are broken down into additional various funding
categories, and each category has different
eligibility requirements.
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Non-Formula Funds - the distribution of federal
funds through allocations as earmarked within the
Transportation Act as defined by Congress (High
Priority Projects), Equity Bonus, and Appalachian
Development Highway System (APD) funding. The
eligibility of Non-Formula Funds is determined
by the type of funds. The High Priority Projects
(HPP) project funding is only eligible for the
specific projects as defined by Congress. The
Appalachian Development Highway System (APD)
funding is only eligible for projects associated
with the completion of the APD system in
Kentucky, which is limited to the US 460
coordinator in Pike County and US 119 in Letcher
County. The Equity Bonus funding has the
flexibility that it can be used on any federal
project, but we use the Equity Bonus to cover
projects that would normally fall under the STP
funded projects.
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Discretionary Funds - yearly allocations of
federal funds through the various federal
discretionary programs, such as Interstate
Maintenance, Ferry Boats, Public Lands Highways,
Scenic Byways, Transportation and Community and
System Preservation Program. Projects receiving
yearly federal Discretionary funding is normally
announced by Congress, and the discretionary
funding is only eligible for the specified
project as defined by Congress.
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FEDERAL STATE HIGHWAY FUNDING LEVELS AVAILABLE
FOR OBLIGATION FROM 2009 THRU 2014(As estimated
by the Kentucky Transportation Cabinet)
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Federal-aid Highway Program Funding Terms
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Authorization Act is the Congressional
legislation that establishes or continues Federal
programs or agencies and establishes an upper
limit on the amount of funds for the program(s).
The current Transportation Act, SAFETEA-LU, is
for the federal-aid highway program.
Appropriations Act is the Congressional
legislation that makes federal funds available
for expenditure with specific limitations as to
the amount, purpose, and duration. For the
federal-aid highway program, the appropriations
act specifies amounts of funds that Congress will
make available for the fiscal year to liquate
obligations. Apportionments distribution of
federal funds using a formula provided in law and
the distribution of funds is called
apportionments. Allocations are the
distribution of federal funds through allocations
as earmarked within the Transportation Act as
defined by Congress (High Priority Projects),
Equity Bonus, Appalachian Development Highway
System (APD), and yearly Discretionary funding
allocations earmarked by Congress or
FHWA. Project Agreement is the federal-aid
highway programming document (PR-1) outlining the
location of the project, the phase of the
project, the project scope, type of work, type
and amount of federal funds, and state matching
funds, which is signed by KYTC and FHWA. The
FHWA approval date is the official date that
state expenditures are eligible for reimbursement
with federal funds.
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Obligation is the term used for the federal
governments legal commitment (promise) to
reimburse the state for the federal share of a
projects eligible costs. Obligation Authority
is the total amount of funds that may be
obligated in a fiscal year. Obligation
Limitation is a restriction or ceiling on the
amount of federal funds that may be obligated
during a specified time period. The obligation
authority or obligation limitation does not
change the distribution of apportionments or
allocations of federal funds it controls the
amount or rate at which the funds may be
obligated. In order to obligate federal-aid
funding, you must have available the
corresponding amount of funding
apportionments/allocations and you must have
available the corresponding amount of obligation
authority. Normally, each year the total federal
apportionments and allocations are greater than
the obligation authority. At the end of the
federal fiscal year, the remaining
apportionment/allocation amounts are carried
forward into the next fiscal year. However,
yearly obligation authority made available for
the Formula Funds must be obligated during the
fiscal year, or the state loses the remaining
available obligation authority associated with
the Formula Funds. The obligation authority
for the Non-Formula and Discretionary funding
can be carried forward into the next fiscal year.

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Rescissions are when unused balances of
previous apportionments or allocations are
cancelled through legislative actions of
Congress. The designated rescission amount
reduces available funding apportionments or
available funding allocations, and normally does
not reduce obligation authority.
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End of Year Redistribution of Additional
Obligation Authority In late July or early
August of each year, FHWA submits an official
notice to each state requesting the state to
prepare a request for End of Year Redistribution
of Additional Obligation Authority for
federal-aid highway Formula Funding. However,
before you can request additional obligation
authority, first you must prove that you can use
the current remaining obligation authority.
Second you must prove that you have projects
available so you can obligate the federal funds
before the end of the federal fiscal year
(October 1). And, third you must have available
funding apportionments within the category of
Formula Funds that you want to obligate, if
provided additional obligation authority through
the redistribution of additional obligation
authority process.
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End of Fiscal Year Redistribution of Obligation
AuthorityFY 2002 thru FY 2008
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Often times you will hear us refer to programming
the federal funds as Advance Construction
(AC).The federal Advance Construction
process provides states the ability to request
and receive approval from FHWA to conduct
designated project activities in advance of
having to use current apportionments and
obligation authority of federal-aid highway
funds, and that expenditures associated with the
designated project activities will be eligible
for federal reimbursement when the advance
construction amount is converted using available
apportionment and obligation authority of
federal-aid funds.Advance Construction is
like using the states federal-aid funding credit
card, and project expenditures will be paid with
state funds and reimbursement of expenditures
will not be requested until federal-aid funding
apportionments and obligation authority is
available to convert the advance construction
amount.
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Kentucky Statewide Transportation Improvement
Program (STIP)Federal Discretionary Funding
Programs
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As noted, the Enacted SYP is the state document
required by KRS, however, federal regulations
require that KYTC prepare and submit to FHWA and
FTA a Statewide Transportation Improvement
Program (STIP).
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The STIP identifies the transportation programs
and projects within Kentucky that will utilize
federal funding. The STIP is prepared in the
summer of even number years and includes highway,
public transit, aviation, transportation
enhancement, Safe Routes to School and
recreational trail projects. Each of the
programs contains a listing of scheduled projects
and scheduled costs for the next four Federal
Fiscal Years. The scheduled costs of the
projects listed in the STIP must be fiscally
constrained.
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The Division of Program Management is also
responsible for preparing applications and
documents for FHWA federal discretionary funding
programs.
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The Division of Program Management is responsible
for monitoring the approved STIP and verifying
that funding requests for proposed projects are
identified within the STIP.
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In addition to the STIP requirements, federal
funded projects located within the nine
Metropolitan Planning Organizations (MPO) areas
must be identified within their MPO
Transportation Improvement Program (TIP) before
project funding can be authorized. If a project
is not identified within the MPO TIP, KYTC must
request the MPO to amend their TIP to include the
project, and this process may take several months
to complete.
MPO Areas

• KIPDA Jefferson, Bullitt, Oldham Counties, KY
  Clark, Floyd Counties, IN
• OKI Boone, Kenton, Campbell Counties, KY
  Butler, Clermont, Hamilton, Warren Counties, OH
  Deerborn County, IN
• FIVCO Boyd and Greenup Counties, KY
• EUTS Henderson County, KY

• GRADD Daviess County, KY
• BRADD Warren County, KY
• LTADD Hardin County, KY
• CMCRPC Christian County, KY
• LFUCG Fayette and Jessamine Counties, KY

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KYTCCash Management Balance Process
Processing Project Funding Requests
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The 2000 General Assembly changed the funding
authorization process to allow the Cabinet to
authorize funding based on projected
expenditures. Going from an authorization base
to an expenditure base required the Cabinet to
develop a Cash Management Balance process and
model. The Cash Management Balance process and
model is used to determine the bottom line cash
balance to cover current fixed cost items,
current expenditures of currently authorized
projects, current modifications to existing
projects, and proposed new funding requests.
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KYTC project managers are responsible for
submittal of funding requests for their projects.
All funding requests for projects identified
within the Enacted SYP and STIP are submitted to
the Division of Program Management.
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• The Division of Program Management reviews
  the request for funding and determines
• If the request is for the initial funding to
  start a project phase, the project phase and
  scheduled funding must be identified within the
  biennium of the current SYP and if federal funds
  it must be identified within the STIP.
• If the request is for additional funding for a
  previously authorized funded phase, a detailed
  explanation of the additional funding is required
  for submittal along with the unsigned TC10 for
  approval signatures.
• An authorized TC10 with approval signatures from
  the Secretary of Transportation and State Highway
  Engineer are required for all state and federal
  funded project phases.

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The Division of Program Management prepares the
project authorization document (TC10) and prints
the unsigned TC10 to route for approval
signatures.
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In addition to the TC10, the projected
expenditures and required cash flow for each
funding request is entered into the KYTC Cash
Management Balance model to determine if cash is
available to cover the projected expenditures.
52
The Division of Program Management routes the
unsigned TC10 and Cash Management Balance sheet
through the Preauthorization Review Team
(Pre-ART) Committee for their review and
recommendation to the Authorization Review Team
(ART) Committee for funding approval signatures.
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Cash Management Model
OR
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Projected Net Road Fund Cash Balance
Based on January 2009 model
KYTC/obfm
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Upon receiving the approved signed TC10, if the
TC10 is for federal funding, the Division of
Program Management then begins the process to
prepare the federal funding programming document
(PR1) to be submitted to FHWA.
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Please keep in mind that the federal PR1 document
approved and signed by FHWA serves as the project
agreement between KYTC and FHWA that the
corresponding project phase activities are
eligible for reimbursement of federal funds in
accordance with federal funding regulations.
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The FHWA approval date is the beginning date that
project expenditures are eligible for
reimbursement, and any project expenditures
occurring prior to the approval date on the PR1
are not eligible for reimbursement of federal
funds.
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Oracle Six-YearHighway PlanPreconstructionStatu
s System
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In 1996 an Oracle relational database system was
developed for the Division of Program Management
by the KYTC Office of Informational Technology.
The Oracle Six-Year Highway Plan Preconstruction
Status System, which is often referred to as the
Precon Status System or the Oracle SYP system, is
a real time relational database system that
numerous KYTC employees within the District
Offices and Central Office Divisions enter data
for SYP projects.
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The Division of Program Management has developed
reports and electronic processes to assist the
project manager and management staff to track the
current status of projects and current status of
funding for each phase of the SYP projects.

• Monthly Status Report
• Project Managers Toolbox on the KYTC DOT Intranet
  website on the Division of Program Managements
  homepage

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KEY TO INTERPRETING INFORMATION PRESENTEDFY
2007- FY 2012 STATUS REPORT
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KEY TO INTERPRETING INFORMATION PRESENTEDFY
2007- FY 2012 STATUS REPORT
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KEY TO INTERPRETING INFORMATION PRESENTEDFY
2007- FY 2012 STATUS REPORT
Note The Federal Funding Program is a
reimbursement program. Thus, State Funds are
used first to cover the costs, and then KYTC
sends weekly invoices to FHWA for reimbursement
of the federal share of the costs. The normal
turn around time is approximately a 7 to ten days.
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Overview of KYTC Project Managers Toolbox
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The following instructions are for accessing the
KYTC Project Managers Toolbox

• Go to KYTC Internet home page
• In the address bar highlight the address and type
  DOT
• You will access the KYTC IntraNet home page, and
  under the Resources block select Program
  Management
• This will take you to the Division of Program
  Management home page, and then select Toolbox
• This will take you to the Project Managers
  Toolbox application

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• The following applications are available in the
  Project Managers Toolbox
• SYP Project Information Center - Access budget
  information by entering the PCN number, the
• TC-10 number, or the SYP Item number
• Non-SYP Project Information Center - Access
  budget information by entering the TC-10 number
• Pending, Pending - Access a list of funding
  requests that are waiting on TC-10s to be
  prepared
• Pending - Access a list of funding requests where
  the TC-10s have been prepared but not approved
• Active SYP Projects - Access information by
  selecting a county. A county map appears that
  identifies current active SYP projects within the
  corresponding county. Click on a yellow, orange,
  or blue box to access the current status
  information for the project and to Zoom To the
  project location on aerial photos
• Active Construction - Access a listing of active
  construction projects by county, and click on the
  PCN number to access the current status of each
  project
• TC-10 Viewer (PAS) - Access an electronic copy of
  a TC-10 by several means, including TC-10 number,
  SYP item number, county, and funding program code
• Unscheduled Project Info - Access the Division of
  Plannings Unscheduled Projects Information
  data system by entering the KYTC district,
  county, project description, route number, and/or
  SYP item number
• Select SYP Project Information - Access awarded
  SYP projects or initial R/W phase funding
  authorizations
• Miscellaneous - Several informational type items
  are available for downloading electronic files or
  printing hard copies

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Cookbook Login Process to Access eMARS to Check
Available Budget Current Expenditures
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• Log into eMARS

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2. Click on Search on the left side of the
screen
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3. Select Page Search from list
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4. Type BQ39 in Page Code field. Hit Enter
key or click on Browse
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5. Click on Funding Priority (BQ39LV1)
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THANK YOU.