The purpose of this memorandum is to clarify the eligibility and criteria for use of FHWA/FTA metropolitan and statewide planning program funds to support UPWP and SPR work activities addressing the integration of transportation, land use, and climate change. Current FHWA/FTA planning requirements (23 U.S.C. 134 and 135, 49 U.S.C. 5303 and 5304) call for metropolitan planning organizations, and State DOTs to consider land use and economic development impacts in their transportation planning processes. It is also recommended that plans be coordinated with others or regional planning organizations and transit agencies.

To reiterate, the transportation planning process needs to consider the coordination between transportation, land use and other planning issues to maximize the effectiveness of public investments. Coordination of transportation and land use planning is an important issue; and particularly now, this is receiving heightened scrutiny and attention due to the climate change and energy issues. For more information on climate change and reduction of transportation-related GHG emissions, please refer to the climate change FAQ document developed by the Office of Planning, Environment, and Realty, which was sent to all FHWA division offices in March 2008.

In 49 U.S.C. §5305 (b), FTA developed guidance¹ outlining eligible activities under the Metropolitan Planning Program and State Planning and Research Program. The guidance states that "comprehensive transportation planning is not limited to transit planning or surface transportation planning, but also encompasses the relationships among land use and all transportation modes, without regard to the programmatic source of Federal assistance." The FHWA has applied similar eligibility interpretation for PL and SPR funding, as long as these transportation-related activities support and are necessary to carry out the transportation planning process (23 U.S.C. §104(f) and §505(a)).

The law and regulation allow latitude in determining the eligibility to fund transportation and supporting planning activities through the Federal-aid (UPWP/SPR) work programs. However, in reviewing and approving funding for those activities, FHWA/FTA staff must first judge the ability of the planning processes to fulfill the critical Federal requirements, including the preparation of federally required planning products, before funding other transportation-related work activities. The FHWA and FTA need to ensure that limited transportation planning funds are used in the most cost-effective manner, do not work at cross-purposes with other State and local decision-making policies and programs, and that funds are prioritized based on the highest needs that benefit the transportation planning process.

Since planning needs, capabilities, approaches, and strategies vary among MPOs and States, it is not possible to provide a definitive list of eligible activities. The criteria listed below, however, will help to assist FHWA and FTA field staff in determining the appropriateness of funding transportation-related activities through planning work programs.

Criteria:

• Clearly Stated Relationship to Transportation Planning - Identify how the work activities and information will benefit the transportation sector and improve the overall quality of the transportation planning process;
• Satisfactory Fulfillment of Basic Transportation Planning Requirements -Ensure that all applicable Federal planning requirements (i.e., Transportation Plan, S/TIP, HPMS, CMP, etc.) are adequately addressed by the pertinent agencies before approving use of UPWP and SPR resources for transportation-related planning activities;
• Quality of the Transportation Planning Process - Determine whether the Federal transportation planning process would also benefit from investment in land use and other planning activities in addition to improving aspects of the current transportation planning process such as public participation, consultation, modeling, transportation financial planning, data collection, etc.; and
  
• Leveraging of Funding from Other Sources for Planning - Review the appropriateness of proposed planning activities for funding by considering the cost sharing among Federal (DOT and non-DOT agencies), State and local government, and relative distribution of benefits and information from the planning activities.

When agencies request transportation planning funds for activities related to climate change, primarily to reduce VMT and GHG emissions in an effort to meet state, regional or local or future Federal GHG emission reduction targets, they must employ generally-agreed to and reasonable assumptions, as well as state of the practice methodologies for the calculation of those VMT and GHG emissions reductions.

Attached are examples of projects that may use or are using Federal-aid transportation planning funds to foster "smart growth," transit oriented development, and related planning activities. For questions and further information, please contact the following individuals:

• Planning Funding Eligibility: FTA - Victor Austin at (202) 366-2996, and FHWA - Ken Petty at (202) 366-6654 / Lorrie Lau at (415) 744-2628
• Climate Change and GHG Issues: Diane Turchetta at (202) 493-0158
• Land Use and Transportation Planning: FTA - Effie Stallsmith at (202) 366-5653, and FHWA - Robin Smith at (720) 963-3072 / Sharlene Reed at (202) 366-9629.

Attachment

1 Circular 8100.1C, Program Guidance for Metropolitan Planning and State Planning and Research Program Grants, September 1, 2008. http://www.fta.dot.gov/regional_offices_8454.html.