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SAFETEA-LU in Montana

SAFETEA-LU in Montana. Montana did very well under SAFETEA-LU Authorized Program Increase over TEA-21 program of 42% Return on contributions to the Highway Trust Fund > 219% Contributions to the trust fund – Federal Fuel Tax Receipts SAFETEA-LU Nationally – $181.9 billion (’05 – ’09 hwys)

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SAFETEA-LU in Montana

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  1. SAFETEA-LU in Montana • Montana did very well under SAFETEA-LU • Authorized Program Increase over TEA-21 program of 42% • Return on contributions to the Highway Trust Fund > 219% • Contributions to the trust fund – Federal Fuel Tax Receipts • SAFETEA-LU Nationally – $181.9 billion (’05 – ’09 hwys) • Montana’s apportionments $1.775 billion (about 30% increase over TEA-21) • Due to the Equity Bonus Protection – Montana’s % share of program will not degrade over time (it did under TEA-21) So –Where is the Money??

  2. Funding TermsAuthorization, Apportionment & Obligation • Authorization – • SAFTEA-LU is a 5-year Authorization Bill (2005-2009) • Sets the level of funds that can be used from the Highway Trust Fund for Title 23 USC programs. • Consider this the maximum program funding level in a perfect world – reality is much different. • Authorized amounts, called authority, is generally the published funding amount – it makes the best press release. • Apportionment – • How authority is distributed to states on a “by program” basis - (Intestate Maint., National Highway, Surface Transportation, etc) • Most Apportioned dollars are distributed based on a state’s characteristics (Interstate Lane Miles, Highway Trust Fund Receipts, Vehicle Miles Traveled, etc) • Obligation Authority • Actual Spendable Dollars!! • Generally is not program specific – the state’s have some level of program flexibility • Is never 100% of the available spending authority • Set each year during the Appropriations Process • Appropriations – annual budget process to establish program levels for the next Federal Fiscal Year.

  3. Obligation Limitation Impact on MDT’s Core Program Think of it as a refining process – FY ’06 as an example $33.9 Billion Authorized For National Program Apportioned to Montana Reduced to reflect 87.1% Obligation Authority (set in annual Approps) Core Program Apportionment $333.4 million $323.6 million $281.9 million This is what we can spend on MDT Projects! Less Non-Core Section 1702 Earmarks $9.8 million For Comparison FY 2003 Obligation Authority for Core Programs was $277 million Notes: Approximately 70% of the projects named for Montana in Section 1702 were from MDT’s Core Program categories. The remaining 30% are directed to projects that are not MDT priorities.

  4. SAFETEA-LU Funding Estimates Little Actual Program Growth in Spendable Dollars SAFETEA-LU Millions SAFETEA-LU Spendable Dollars FY 2003 When the obligation limit is taken into account – we see very little growth Notes: Obligation limitation is 85% of Apportionment. Years beyond FY 2009 estimates based on Highway Trust Fund balance projections

  5. In-State Funding Distribution State Wide Funding Distribution • Core Programs • 70% of funds – Follow’s TEA-21 Level of investment in these areas • This level of investment is necessary to maintain the integrity of the system (includes IM, NH, & STP - with EB distribution and HPP projects) • New Core Safety Program • Replaces STP Safety set-asides • An increase for safety at a greater rate than the overall program rate of increase • Secondary Program – • Increased by $2 million annually • New Urban Pavement Preservation Program • Projects selected by Locals and MDT DA’s • New Borders Program • Funds must be used within 100-miles of international border - non-transferable • New “X”-Route Program – Currently, these roads have no funding source • This program will allow MDT to use Federal funds on 30% of these “orphaned” roads.

  6. Complicated In-State Distribution – 21 programs

  7. Earmarks Above the line/Below the line In SAFETEA-LU “the line” divides what counts against a state’s guaranteed percent share of the program. • Below the line do, above the line doesn’t. • What does this mean? • If a state has below the line projects named that are not identified priorities – it takes those funds away from the core program projects. • SAFETEA-LU Section 1702 – High Priority Projects • Below the line • 14 Named Projects – total $164.6 million • Count against MDT’s % Share of the program • 20% distributed each year of the bill • Again, Montana did very well. • About 70% of these projects came from MDT’s approved TCP – Critical to MDT’s program Delivery • SAFETEA-LU Section 1934 – Transportation Improvement Projects • Above the line projects • 19 Named Projects – total $153.625 million • Do not count against MDT’s share of the program • Stepped distribution – 10%,20%, 25%,25%,20%

  8. Earmarks • For Both Above and Below the Line • Obligation authority available until expended • A state can “borrow” from other projects within that state to fund those that are ready at the earliest date • Don’t have to wait until FY’09 to receive the entire amount • All funds borrowed must be paid back by the end of this authorization. • One exception – House named projects are not eligible for the borrow provision (S-323 Ekalaka to Alzada in MT) • All are subject to the Sliding Scale Match • 86.58% Fed / 13.32% Non-fed • MDT will match projects that are ours, other recipients must match their projects. Questions??

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