Special Experimental Project (SEP-16) To Evaluate Proposals for Delegation of FHWA Responsibilities to States

Nicole R. Nason
Federal Highway Administration
24 June 2020

[Federal Register Volume 85, Number 122 (Wednesday, June 24, 2020)]
[Notices]
[Pages 38011-38013]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-13564]


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DEPARTMENT OF TRANSPORTATION

Federal Highway Administration


Special Experimental Project (SEP-16) To Evaluate Proposals for 
Delegation of FHWA Responsibilities to States

AGENCY: Federal Highway Administration (FHWA), U.S Department of 
Transportation (DOT).

ACTION: Notice.

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SUMMARY: The FHWA is expanding the Special Experimental Project (SEP-
16), originally announced in a Federal Register notice published on 
September 20, 2018. The SEP-16 permits testing and evaluation of 
delegations to States of FHWA program-level actions. The FHWA is 
expanding SEP-16 to allow experimentation with delegation of FHWA 
responsibilities related to project delivery. This new SEP-16 scope 
includes potential experimentation with responsibilities not previously 
considered subject to assumption under Stewardship and Oversight 
Agreements between FHWA and State departments of transportation (State 
DOT).

DATES: This expanded SEP-16 Project is effective on June 24, 2020.

FOR FURTHER INFORMATION CONTACT: For technical information: Peter 
Stephanos, Office of Stewardship, Oversight, and Management, (202) 366-
0027; for legal information: Janet Myers, Office of the Chief Counsel 
(HCC), (202) 366-2019, 1200 New Jersey Avenue SE, Washington, DC 20590. 
Office hours are from 8:00 a.m. to 4:30 p.m., ET, Monday through 
Friday, except Federal holidays.

SUPPLEMENTARY INFORMATION: 

Electronic Access

    An electronic copy of this notice may be downloaded from the 
Federal Register's home page at: http://www.archives.gov; the 
Government Publishing Office's database at: https://www.gpo.gov/fdyss/; 
or the specific docket page at: www.regulations.gov.

[[Page 38012]]

Background

    For information on the background and legal authority for SEP-16 
pursuant to 23 U.S.C. 502(b), please refer to the Federal Register 
notice announcing SEP-16, published on September 20, 2018 (83 FR 47674) 
(SEP-16 notice).
    After announcing SEP-16, FHWA received expressions of interest from 
States wishing to experiment with types of delegation not expressly 
included within the scope of the SEP-16 notice. Several of the requests 
related to actions that, to date, FHWA has not treated as subject to 
assumption under 23 U.S.C. 106(c) or other authorities.
    After consideration, FHWA concluded that expanding SEP-16 into a 
general authority for experimentation with delegation to States of FHWA 
program/project authorities could provide useful information for future 
determinations about administration of the Federal-aid Highway Program 
(FAHP). This supplemental notice expands SEP-16 to allow 
experimentation with delegations of authority for FAHP program/project 
actions where FHWA determines such experimentation is appropriate.
    The scope of permissible experimentation is subject to the 
conditions described in the SEP-16 notice (83 FR 47675) except as 
modified in this notice. This expanded authority may be used to 
experiment with project development, construction, and post-
construction actions relating to a specific project, group of projects, 
or a program. The SEP-16 experimental authority continues to exclude 
from testing and evaluation the Federal decisions relating to 
eligibility, obligation, reimbursement, authorization, and compliance. 
In addition, SEP-16 experimental authority will not be available to 
test delegations relating to the environmental review process, as there 
are statutes and regulations that expressly address assignment of 
FHWA's environmental responsibilities (see, e.g., 23 U.S.C. 327).
    This expansion of SEP-16 will allow FHWA to understand more fully 
the potential implications of delegating FAHP decisions not previously 
subject to assumption or delegation under 23 U.S.C. 106(c) and other 
authorities. The lessons learned from SEP-16 will aid FHWA in 
developing comprehensive policies and inform stakeholders if the 
delegation of FHWA authorities is appropriate.
    To facilitate public access to SEP-16 information, all SEP-16 
proposals, workplans, and reports will be posted on a public facing 
website.\1\
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    \1\ https://www.fhwa.dot.gov/innovativeprograms/sep-16/.
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Solicitation of Letters of Interest

    This notice announces the expanded SEP-16 and requests Letters of 
Interest for experimentation with FHWA actions relating to program/
project delivery. Entities eligible to submit letters (``Applicants'') 
are State DOTs as defined in 23 U.S.C. 101. Letters of Interest, which 
should be submitted to the appropriate FHWA Division Office, initiate 
the application process described below. The Letter of Interest should 
include a high-level description of the Applicant's proposal, reasons 
for wanting to assume the authority, and the anticipated resulting 
improvements to program/project delivery. Ideally, the Applicant will 
quantify the resulting improvements in terms of time and/or cost 
savings. The Applicant should include enough detail to allow FHWA to 
determine how the proposal deviates from current law (including 
regulations) and practice, and how the actions covered by the proposal 
are addressed in current policy. The Letter of Interest should 
reference the specific legal authority(ies) under Title 23 being 
requested for delegation. Further, the Applicant should provide 
specific examples that demonstrate experience with delegation in the 
affected area(s), or in areas the Applicant deems similar in nature, if 
applicable. The Applicant should describe the level of collaboration 
conducted so far with relevant FHWA Division or program offices about 
the proposal.

Application Process

    The FHWA is retaining the application process announced in the SEP-
16 notice which is repeated here for reference. The application process 
is three-tiered, with each step developing more specifics of the 
proposed assumption(s) for FHWA consideration and feedback. The FHWA 
will evaluate each step to determine whether a proposal falls within 
the scope of section 502(b) and is appropriate for this experimental 
process before inviting and working with an Applicant to proceed to the 
next step for more detailed proposal development.
    The first step in the application process is the Letter of Interest 
described above. The FHWA will acknowledge receipt of the Letter of 
Interest and provide an anticipated timeframe for initially evaluating 
the proposal and providing a formal response. After review of the 
proposal, FHWA will provide a formal response that will either request 
the Applicant to proceed with submitting a Concept Paper, or provide 
FHWA's explanation for not advancing the proposal.
    If a Concept Paper is requested, the Applicant should submit to the 
appropriate FHWA Division Office a narrative further detailing the 
Applicant's proposal. This Concept Paper should not exceed 5 pages and 
be formatted single-spaced, using a standard 12-point font with 1-inch 
margins. Charts, tables, and other items may also be submitted as 
attachments to supplement the narrative and do not count toward the 5-
page limit. The Concept Paper should demonstrate that the State has the 
necessary laws, regulations, controls, and resources in place to assume 
the Federal role for the responsibilities requested. If applicable, the 
Applicant may use experience with assumption of authorities under 23 
U.S.C. 106(c) and other authorities to demonstrate readiness to assume 
the requested responsibilities. If any necessary piece is missing, the 
Applicant should outline a plan and timeline anticipated to put pieces 
in place. In addition, the Concept Paper should detail supporting 
analysis for the anticipated program/project delivery improvements and 
consider a risk assessment of the expected impact the assumption of 
authority may have on the State's program--specifically on resources, 
processes, and stakeholders--and include measures the State would use 
to ensure the responsibilities are carried out in accordance with 
Federal requirements. The Concept Paper should also summarize any 
preparation the Applicant may need to make if the experiment is 
approved and the time necessary for that preparation (e.g., provide 
training for staff, make needed changes to procedures, organization 
charts). The FHWA will evaluate the Concept Paper, and either request 
the Applicant to proceed to the Detailed Proposal stage, or provide an 
explanation for not advancing the request.
    Since the requirements for the Detailed Proposal will vary 
depending on the complexity of the proposed delegation and the results 
of FHWA's evaluation of the Concept Paper, the appropriate FHWA 
Division will coordinate with the Applicant in preparing the Detailed 
Proposal. At a minimum, the Applicant's Detailed Proposal should: (1) 
Propose a duration for conducting the experiment, including a timeline 
for any transition activities; (2) identify key personnel and contacts 
with proposed roles and responsibilities; and (3) recommend an

[[Page 38013]]

Evaluation Plan with reporting mechanisms, performance measures, goals, 
and other evaluation criteria, and frequency of reviews. To provide 
consistency among the SEP-16 experiments, FHWA will provide the 
Applicant certain performance measures and evaluation criteria common 
to all SEP-16 Evaluation Plans.
    Should FHWA decide to proceed with the experiment, FHWA and the 
Applicant will enter into a memorandum of understanding and develop a 
workplan for the experiment.

Conclusion

    The FHWA is committed to continuing its transition to a risk-based 
approach to stewardship and oversight of the FAHP. To this end, SEP-16 
is designed to provide FHWA with a better understanding of the 
implications of allowing States to assume program/project authorities 
currently exercised by FHWA. This notice supplements the SEP-16 notice 
published on September 20, 2018, by expanding SEP-16 to allow 
experimentation with delegation of FHWA authorities relating to program 
and project delivery, and amending the application process to reflect 
this expansion.

(Authority: 23 U.S.C. 315 and 502).

Nicole R. Nason,
Administrator, Federal Highway Administration.
[FR Doc. 2020-13564 Filed 6-23-20; 8:45 am]
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