Grant Program Delivery RRIF Updates Monitoring & Technical Assistance

1. Corey Hill, Director, Office of Program Delivery, FRA • Grant Program Delivery • RRIF Updates • Monitoring & Technical Assistance

2. Corey Hill – Grant Program Delivery

3. Federal Funding for FRA Programs (FY08-FY14) Applications under DOT review; announcements pending Applications due to FRA by September 15th

4. Keeping Projects On Schedule: Deliverable Submission Deliverables Due to FRA by Month (2010-2017) 215 Overdue Deliverables 57% Are for Construction Deliverable Status Overdue Awaiting Document Received Deliverable Status as of 9/2/2014

5. September 2015 March 2015 Today Anticipated Deliverable Completion Dates • The majority of deliverables are scheduled to be completed by next year • Timely deliverable submissions are crucial to ensure projects stay on schedule and complete on time Deliverable Status Overdue Awaiting Document Received

6. Project Delivery – Grant Closeouts 195 active grants in FRA’s portfolio – 25 have exceeded their period of performance end date 49% scheduled to be closed 64% scheduled to be closed

7. HSIPR ARRA Outlays – 3 Years Remain Must spend $5M per day to meet 2017 deadline

8. Corey Hill – Monitoring & Technical Assistance

9. MTAC Program – Status Update • Through the Volpe Center, 10 task orders have been awarded • 9 regional task orders • 1 task order for vehicle/equipment support • 1st FRA Rail Program Delivery Meeting Held August 4-6, 2014 MTAC • Significant contractor resources • More technical expertise • Consistent nationwide approach

10. MTAC Program – Next Steps • Webinars • Anticipate 1-3 before next spring • FRA will be soliciting input for topics stakeholders would like covered by webinars • Most requested topic from August Rail Program Delivery Meeting was “Lessons Learned” from projects across the country • Conference in 2015 • Continued analysis of trends and feedback received through MTAC Program

11. Michael Lestingi, Director, Office of Policy and Planning

12. Transportation Technology Center

13. Transportation Technology Center • July 28, 1968 - Congress authorizes the development of an intermodal research facility • May 19, 1971 - Formal dedication of the High Speed Ground Test Center by Secretary of Transportation, John Volpe • Until 1982the facility was developed and operated by FRA and Urban Mass Transit Administration (now FTA) • Now managed under contract to FRA by the Transportation Technology Center, Inc. a wholly owned subsidiary of the Association of American Railroads • 52 Square miles of land leased from the State of Colorado • 48 miles of track including a high-speed loop of 13 miles capable of 165 mph • Laboratory equipment capable of testing full size rail cars • Current uses of TTC include new equipment testing and FRA and AAR research

14. Scott Greene, Chief, Freight Rail Policy Division, FRA • Class II and Class III Railroad Capital Needs Study—Preliminary Findings • Charge from Congress • Study Approach • Survey Results • Key Take Aways

15. Class II and Class III Capital Needs • Charge from Congress in Appropriations Report: • Summarize the capital investment needs of the Class II and Class III railroads. • Assess how the capital needs are being met by sources other than the Federal Government.

16. Study Approach • Upper Great Plains Transportation Institute (UGPTI) in conjunction with ASLRRA and AAR surveyed Class II and Class III carriers • FRA conducted interviews with railroad financial experts, railroad holding companies, banks, and short line railroads. • Study needed to take a long view because of the evolution of this segment of the rail industry.

17. Study Approach • How has the industry been able to survive since the growth in the number of short lines following Staggers and concerns in the early 90’s about sustaining operations? • Carriers faced unique challenges accessing capital. • Over the past 20 years, the emergence of the railroad holding company has changed the relationship between lenders and short line railroads. • Risk is now spread among carriers under the umbrella of the holding company.

18. Survey Results • UGPTI surveyed 470 railroads. • Response from 149 railroads but only 115 provided sufficient data to assess needs. • To meet current needs respondents require spending of $599 million. When expanded to entire short line segment of the industry, preliminary estimates show required current spending levels at $1.6 billion. • Estimated spending over the next 5 years is $1.23 billion—$986 million for infrastructure & $247 million for equipment. When expanded to industry, estimates are $5.3 billion. • Total spending needs are $6.9 billion.

19. Survey Results: Source of Funds

20. Emergence of the Holding Company

21. Key Take Aways • While carriers under holding companies have been able to access capital, challenges remain. • Difficulties in obtaining all the capital from one source. • Holding companies reported that they need private and government programs to meet needs. • Track upgrades to 286K are critical as well as investment in the bridges to accommodate traffic and maintain a state of good repair. Investment has been incremental. • Sources of funding include private capital markets, State programs, RRIF, TIGER, and 45G tax credits.

22. Key Take Aways • Consolidation of short lines under holding companies will continue, where there is value or potential value. • Concern going forward is with independent short lines that are poor performers. • States will need to assess how these carriers can help meet future transportation needs. • State Rail Plans and State Freight Plans are essential in state transportation planning efforts. • All is not rosy. Holding companies have changed the lending calculus, but they are piecing together and spreading thinly all of the investment dollars they can get.

23. David Valenstein, Chief, Environment & Planning Division, FRA • Kyle Gradinger, Planner, Environment & Planning Division, FRA • Regional Rail Planning • FRA Planning Framework • Southwest Multi-State Study • Call for Statements of Interest and Qualifications

24. FRA Planning Framework • National Rail Planning • Regional (Multi-state) Rail Plans • Corridor Plans • State Rail Plans

25. National Rail Planning National Planning Parameters Standardized Criteria, Tools, & Guidance “Tier 0” Regional Rail Plans What does the map look like? Tier I Corridors & Terminal Areas CITY Tier II Projects

26. Regional Planning National Planning Parameters Standardized Criteria, Tools, & Guidance “Tier 0” Regional Rail Plans What does the map look like? Tier I Corridors & Terminal Areas Tier I Corridors & Terminal Areas CITY CITY Tier II Projects Tier II Projects

27. Elements of a Regional Rail Plan Baseline Conditions & Market Assessment Generalized Network Vision & Service Plan Adopted Regional Rail Plan Draft Regional Rail Plan State-by-State Adoption (incl. incorporation into STIPs and State Rail Plans as needed) Governance Strategies Prioritized Investments & Map Costs, Benefits & Funding

28. Corridor Planning (Tier I) National Planning Parameters Standardized Criteria, Tools, & Guidance “Tier 0” Regional Rail Plans What does the map look like? Tier I Corridors & Terminal Areas CITY CITY CITY Tier II Projects

29. Elements of a Tier I Corridor Plan • Technical analysis of rail service, consistent w/ NEPA Purpose and Need • Progressively narrows to reasonable alternatives using tools to assess: • Engineering feasibility • Ridership • Operational Impacts • Costs and Public Benefits • Leads to Passenger Rail Corridor Investment Plan (PRCIP): • NEPA review and Service Development Plan (SDP)

30. Elements of a Tier I Corridor Plan • SDP prepared at end of PRCIP planning phase • Primary objectives of SDP are to: • Demonstrate rationale for service • Address Purpose and Need identified through NEPA • Summarize technical analysis for proposed alternative • Demonstrate operational and financial feasibility • Describe implementation and phasing of Service Development Program

31. Project-level Planning (Tier II) National Planning Parameters Standardized Criteria, Tools, & Guidance “Tier 0” Regional Rail Plans What does the map look like? Tier I Corridors & Terminal Areas CITY Tier II Projects

32. State Rail Plans Key components of a comprehensive, multi-modal planning approach that define rail’s role in a broader transportation network and guide public investment in the transportation network • Reflect States’ visions for passenger and freight rail and harmonize individual studies, plans and projects • Opportunity to show the full extent of State’s rail programs – including costs and benefits • Signal to lawmakers and FRA about State’s goals

33. State Rail Plans Within the FRA Planning Framework National Planning Parameters Standardized Criteria, Tools, & Guidance “Tier 0” Regional Rail Plans State Rail Plans Tier I Corridors & Terminal Areas CITY Tier II Projects

34. Integration of State Rail Plans with Other Plans National Corridors State Rail Plan Statewide LRTP Private Railroad Investment Plans State Rail Plans State Freight Plan Public Private Partnerships Metropolitan Transportation Planning Local/Shortline Plans

35. Southwest Multi-State Study • Study Overview • Planning Context • Network Analysis Approach • Preliminary Network Vision • Study Recommendations • Lessons Learned about Process

36. Overview • Study Purpose and Objectives: • Identify network of “candidate corridors” for further evaluation and planning using CONNECT tool. • Identify institutional challenges and opportunities related to multi-state rail development and delivery. • More than 20 stakeholders from six states met multiple times over seven months.

37. Planning Context • Land Development Patterns • Demographics • Economic Activity • Existing and Forecast Travel Source: CONNECT Beta Version, 2012.

38. Network Analysis Approach

39. Preliminary Network Vision • Rail Network and Service Concepts Source: CONNECT Beta Version, 2012.

40. Study Recommendations • Integrate the SW Multi-State Rail Planning Study into existing and ongoing transportation planning efforts • Establish a SW Rail Working Group to initiate implementation of the Study’s governance recommendations • Convene a voluntary CA-AZ-NV Passenger Rail Policy & Planning Group • Form a Blue Ribbon Commission to guide a Phoenix-Southern California Corridor Study

41. Needs for multi-state coordination Lessons Learned about Process Multi-phase Ownership Knowledge sharing Operations Marketing and customer service Service standards Cost and revenue sharing Design and Construction Interoperability standards Planning Multi-State Vision Data for Project Evaluation Grant Applications Operating Standards Safety Standards • Federal involvement is important • Provide clear definition of study purpose and potential outcomes • Incorporate other modes into process • Initiate development of goals and P&N early in multi-state process • Concentrate stakeholder efforts on in-person workshops • No one-size-fits-all governance approach

42. Federally-led Regional Planning Studies • FRA wants to build on the Southwest Study and encourages other regions to conduct similar regional efforts in line with the Planning Framework • FRA has funding authority provided under the FY14 Omnibus Appropriations Act (Public Law 113-76) • FRA will be releasing a Call for Statements of Interest and Qualifications in the coming weeks • Note: This is not a grant or funding opportunity for states. It is an opportunity to participate in an FRA-led planning process

43. Applicants Will Be Asked to Describe: Rationale: Why do stakeholders want FRA to conduct a study in their region? Stakeholders: Who will participate in the study? Previous Work: What Regional or Multi-State Planning has been completed in the region? Governance: What institutional arrangements exist to support planning and rail development in the region? Commitment: How are the states and stakeholders willing to support the study?

44. Thank you! • Questions? • David Valenstein • (202) 493-6368 • David.Valenstein@dot.gov • Kyle Gradinger • (202) 493-6191 • Kyle.Gradinger@dot.gov

45. Office of Inspector General U.S. Department of Transportation Mitch Behm Assistant Inspector GeneralSurface Transportation Update from the DOT Office of Inspector General

46. What is a FederalInspector General?

47. The DOT Inspector General

48. The DOT Inspector General

49. OIG’sReturn on Investment $ 41 Return for Each Budget Dollar Spent in Fiscal Year 2013

50. The DOT OIG Hotline 1-800-424-9071 hotline@oig.dot.gov www.oig.dot.gov/hotline