FTA Releases Initial Guidelines for Capital Investment Grant Program | Nossaman LLP

Transit authorities across the country rely on the Capital Investment Grant (“CIG”) program administered by the Federal Transit Administration (“FTA”) to fund major capital expenditures for expansion projects and basic capacity. The CIG program is codified at 49 USC § 5309, and FTA currently administers the program pursuant to its “Final Draft Policy Guidancepublished in June 2016.

The recently enacted law Infrastructure Investment and Employment Act (PL 117-58; “IIJA”) changed the status of the CIG program. Accordingly, FTA has prepared initial tips on the IIJA’s revisions to the CIG program and invites comments from all interested parties until April 14, 2022. This initial guidance invites comments on the changes to the CIG program in the IIJA and covers the following three topics: (1) project eligibility; (2) procedures related to achieving transit asset management objectives; and (3) how sets of CIG projects can enter the project development phase of the CIG program.

These initial guidelines do not wholesale replace the 2016 guidelines, and FTA intends to provide a more comprehensive update to the 2016 guidelines later this year. The following three topics covered in the initial guidelines will help project proponents understand the IIJA’s revisions to the CIG program as FTA prepares for the broader guideline update:

  1. Project Eligibility. The first guidelines revise the eligibility thresholds for projects. The CIG Program’s Small Starts eligibility now applies to projects with an estimated total capital cost of less than $400 million and requesting CIG funding of less than $150 million. The CIG Program’s New Starts eligibility now applies to projects with an estimated total capital cost of $400 million or more or requesting CIG funding of $150 million or more. The initial guidance also revises the eligibility of the base capacity of the CIG program to corridors which are at full capacity today or which will be in 10 years.
  2. Procedures related to achieving transit asset management objectives. The initial guidelines also reflect the IIJA’s new requirement that CIG projects progress toward achieving FTA’s good condition or “Transit Asset Management” performance goals set forth in 49 USC § 5326(c). (2).
  3. CIG project packages. The IIJA allows project proponents to group CIG projects, either immediately or in the future, and advance that group of projects through the CIG process. The initial guidelines reflect this new eligibility, providing that each project in a lot must be individually eligible for the CIG and included in the applicable metropolitan transport plan. Groupage should also improve the capacity of the transport system and save time or money.