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Surface Transportation Project Delivery Program; Alaska Department of Transportation Fourth Audit Report Publication: Federal Register Agency: Federal Highway Administration Byline: Stephanie Pollack Date: 3 November 2022 Subject: American Government 
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[Federal Register Volume 87, Number 212 (Thursday, November 3, 2022)]
[Notices]
[Pages 66352-66355]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-23916]
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DEPARTMENT OF TRANSPORTATION
Federal Highway Administration
[FHWA Docket No. FHWA-2021-0019]
Surface Transportation Project Delivery Program; Alaska
Department of Transportation Fourth Audit Report
AGENCY: Federal Highway Administration (FHWA), Department of
Transportation (DOT).
ACTION: Notice; request for comment.
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SUMMARY: The Moving Ahead for Progress in the 21st Century Act (MAP-21)
established the Surface Transportation Project Delivery Program that
allows a State to assume FHWA's environmental responsibilities for
environmental review, consultation, and compliance under the National
Environmental Policy Act (NEPA) for Federal highway projects. When a
State assumes these Federal responsibilities, the State becomes solely
responsible and liable for carrying out the responsibilities it has
assumed, in lieu of FHWA. This program mandates annual audits during
each of the first 4 years of State participation to ensure compliance
with program requirements. This notice announces and solicits comments
on the fourth audit report for the Alaska Department of Transportation
and Public Facilities (DOT&PF).
DATES: Comments must be received on or before December 5, 2022.
ADDRESSES: Mail or hand deliver comments to Docket Management Facility:
U.S. Department of Transportation, 1200 New Jersey Avenue SE, Room W12-
140, Washington, DC 20590. You may also submit comments electronically
at www.regulations.gov. All comments should include the docket number
that appears in the heading of this document. All comments received
will be available for examination and copying at the above address from
9 a.m. to 5 p.m., e.t., Monday through Friday, except Federal holidays.
Those desiring notification of receipt of comments must include a self-
addressed, stamped postcard or you may print the acknowledgment page
that appears after submitting comments electronically. Anyone can
search the electronic form of all comments in any of our dockets by the
name of the individual submitting the comment (or signing the comment,
if submitted on behalf of an association, business, or labor union).
The DOT posts these comments, without edits, including any personal
information the commenter provides, to www.regulations.gov, as
described in the system of records notice (DOT/ALL-14 FDMS), which can
be reviewed at www.dot.gov/privacy.
FOR FURTHER INFORMATION CONTACT: Mr. David T. Williams, Office of
Project Development and Environmental Review, (202) 366-5074,
David.Williams@dot.gov, or Mr. Patrick Smith, Office of the Chief
Counsel, (202) 366-1345, Patrick.C.Smith@dot.gov; Federal Highway
Administration, U.S. Department of Transportation, 1200 New Jersey
Avenue SE, Washington, DC 20590. Office hours are from 8:00 a.m. to
4:30 p.m., e.t., Monday through Friday, except Federal holidays.
SUPPLEMENTARY INFORMATION:
Electronic Access
An electronic copy of this notice may be downloaded from the
specific docket page at www.regulations.gov.
Background
The Surface Transportation Project Delivery Program, codified at 23
U.S.C. 327, commonly known as the NEPA Assignment Program, allows a
State to assume FHWA's environmental responsibilities for review,
consultation, and compliance for Federal highway projects. When a State
assumes these Federal responsibilities, the State becomes solely liable
for carrying out the responsibilities it has assumed, in lieu of FHWA.
The Alaska DOT&PF published its application for NEPA assumption on May
1, 2016; and made it available for public comment for 30 days. After
considering public comments, DOT&PF submitted its application to FHWA
on July 12, 2016. The application served as the basis for developing a
memorandum of understanding (MOU) that identified the responsibilities
and obligations that DOT&PF would assume. The FHWA published a notice
of the draft MOU in the Federal Register on August 25, 2017, with a 30-
day comment period to solicit the views of the public and Federal
agencies. After the close of the comment period, FHWA and DOT&PF
considered comments and proceeded to execute the MOU. Effective
November 13, 2017, DOT&PF assumed FHWA's responsibilities under NEPA,
and the responsibilities for NEPA-related Federal environmental laws
described in the MOU.
Section 327(g) of title 23, U.S.C., requires the Secretary to
conduct annual audits to ensure compliance with the MOU during each of
the first 4 years of State participation and, after the fourth year,
monitor compliance. The FHWA must make the results of each audit
available for public comment. The FHWA published a notice regarding the
third audit report in the Federal Register on December 7, 2020,
soliciting comments for 30 days pursuant to 23 U.S.C. 327(g). The FHWA
received comments on the draft report from the American Road &
Transportation Builders Association (ARTBA). The ARTBA's comments were
supportive of the Surface Transportation Project Delivery Program and
did not relate specifically to the audit. The team has considered these
comments and is finalizing the audit report. This notice announces the
availability of the fourth audit report to the DOT&PF and solicits
public comment on the same.
Authority: Section 1313 of Public Law 112-141; Section 6005 of
Public Law 109-59; 23 U.S.C 327; 23 CFR 773.
Stephanie Pollack,
Deputy Administrator, Federal Highway Administration.
Surface Transportation Project Delivery Program, FHWA's Audit of the
Alaska Department of Transportation
April 12-16, 2021
Executive Summary
This report summarizes the results of the Federal Highway
Administration's (FHWA) fourth audit of the Alaska Department of
Transportation and Public Facilities' (DOT&PF) assumption of FHWA's
project-level National Environmental Policy Act (NEPA) responsibilities
and obligations pursuant to a 23 U.S.C. 327 Memorandum of Understanding
(MOU). The DOT&PF entered the NEPA Assignment Program after more than 8
years of experience making FHWA NEPA Categorical Exclusion (CE)
determinations pursuant to 23 U.S.C. 326 (beginning September 22,
2009).
Alaska's MOU became effective on November 13, 2017; and was amended
on August 20, 2020. Currently, FHWA's NEPA responsibilities in Alaska
include the oversight and auditing of the DOT&PF's execution of the
NEPA Assignment Program and certain activities excluded from the MOU,
such as the NEPA reviews of projects advanced by direct recipients
other than the DOT&PF.
The FHWA audit team began to prepare for the site visit in November
2020. The audit team reviewed DOT&PF's NEPA project files, DOT&PF's
response to FHWA's pre-
[[Page 66353]]
audit information request (PAIR), and DOT&PF's Self-Assessment Report.
On April 12-16, 2021, the audit team conducted a virtual site visit for
the second year due to COVID-19 pandemic safety concerns, rather than
on-site visits as had been used for the first two audits.
The audit team appreciates DOT&PF's responsiveness to the questions
regarding the status of general observations from the third audit. This
report concludes with a status update for FHWA's observations from the
third audit report.
The audit team finds DOT&PF in substantial compliance with the
terms of the MOU in meeting the responsibilities it has assumed. This
report does not identify any non-compliance observations; it does
identify four general observations and three successful practices.
Background
The NEPA Assignment Program allows a State to assume FHWA's
environmental responsibilities for review, consultation, and compliance
for highway projects. This program is codified at 23 U.S.C. 327. When a
State assumes these Federal responsibilities for NEPA project
decisionmaking, the State becomes solely responsible and solely liable
for carrying out these obligations in lieu of and without further NEPA-
related approval by FHWA.
The FHWA assigned responsibility for making project NEPA approvals
and other related environmental decisions for highway projects to
DOT&PF. The MOU documents these responsibilities. Examples of
responsibilities DOT&PF has assumed, in addition to NEPA, include
Section 7 consultation under the Endangered Species Act and
consultation under Section 106 of the National Historic Preservation
Act.
This is the last of the four required annual audits pursuant to 23
U.S.C. 327(g) and Part 11 of the MOU. The FHWA uses audits as the
primary mechanism to oversee DOT&PF's compliance with the MOU and the
NEPA Assignment Program requirements. This includes ensuring compliance
with applicable Federal laws and policies, evaluating DOT&PF's progress
toward achieving the performance measures identified in Section 10.2 of
the MOU, and collecting information needed for DOT Secretary's annual
report to Congress. The FHWA must present its audit results in a report
and make it available for public comment in the Federal Register.
The audit team included NEPA subject matter experts from FHWA
Alaska Division Office, the Headquarters Office of Project Development
and Environmental Review, the Resource Center, Western Legal Services
Division, Office of Stewardship, Oversight and Management, and the DOT
Volpe Center.
Scope and Methodology
The audit team examined a sample of DOT&PF's NEPA project files,
DOT&PF responses to the PAIR, and DOT&PF's Self-Assessment Report. The
audit team also conducted interviews and reviewed DOT&PF policies,
guidance, and manuals pertaining to NEPA responsibilities. All reviews
focused on objectives related to the six NEPA Assignment Program
elements contained in the MOU: Program Management, Documentation and
Records Management, Quality Assurance/Quality Control (QA/QC),
Training, Performance Measures, and Legal Sufficiency.
Project File Review: To consider DOT&PF staff adherence to program
procedures and Federal requirements, the audit team selected a sample
of 47 individual project files for which the environmental review had
been completed. The audit team evaluated DOT&PF's compliance with
assumed responsibilities and adherence to their own processes and
procedures for project-level environmental decisionmaking. The audit
team did not evaluate DOT&PF's project-specific decisions. The sampled
files included CEs, Environmental Assessments (EA), and environmental
reevaluations.
PAIR Review: The audit team reviewed DOT&PF's responses to the
PAIR, which consisted of 28 questions about specific elements in the
MOU that DOT&PF must implement. The audit team used these responses to
develop specific follow-up questions for interviews with DOT&PF staff.
DOT&PF Self-Assessment Review: The audit team reviewed DOT&PF's
December 2020 Self-Assessment Report and used it to develop specific
follow-up questions for interviews with DOT&PF staff. The NEPA
Assignment Program MOU Section 8.2.5, requires the DOT&PF to conduct
annual self-assessments of its QA/QC procedures and performance.
Interviews: The audit team conducted interviews with 17 DOT&PF
employees, including staff from each of DOT&PF's 3 regional offices and
the Statewide Environmental Office (SEO). The audit team invited DOT&PF
employees representing a diverse range of expertise, experience, and
program responsibility to participate in interviews.
In addition, the audit team conducted interviews of two attorneys
with the Alaska Department of Law and interviews with individuals at
the Bureau of Land Management (BLM), the United States Forest Service
(USFS), and the State Historic Preservation Office (SHPO).
Policy/Guidance/Manual Review: Throughout the document reviews and
interviews, the audit team verified information on DOT&PF's NEPA
Assignment Program using DOT&PF policies, guidance, manuals, and
reports. These included the Environmental Program Manual (EPM), the
NEPA Assignment QA/QC Plan, the NEPA Assignment Program Training Plan,
and the NEPA Assignment Self-Assessment Report.
Overall Audit Opinion
This report identifies four observations and three successful
practices. The audit team finds DOT&PF is substantially in compliance
with the provisions of the MOU, has carried out the environmental
responsibilities it assumed through the NEPA Assignment Program, and
has taken steps to address observations identified in the third audit.
Non-Compliance Observations
The audit team did not make any non-compliance observations in the
fourth audit.
Observations and Successful Practices
This section summarizes the audit team's observations of DOT&PF's
NEPA Assignment Program implementation and DOT&PF's successful
practices. ``Observations'' are items the audit team would like to draw
DOT&PF's attention to, which may benefit from revisions to improve
processes, procedures, or outcomes, if such steps have not already been
taken. ``Successful practices'' are those that FHWA would like to
commend DOT&PF on developing. These may include ideas or concepts that
DOT&PF has planned, but not yet implemented. Successful practices and
observations are described under the six MOU topic areas: Program
Management, Documentation and Records Management, QA/QC, Training,
Performance Measures, and Legal Sufficiency.
This audit report provides an opportunity for DOT&PF to take
further actions to improve their program. The FHWA will consider the
status of areas identified for potential improvement in this audit's
observations as part of the scope of future monitoring events.
[[Page 66354]]
DOT&PF will continue to be able to describe program improvements in
their annual Self-Assessment reports.
Program Management
Program Management includes the overall administration of the NEPA
Assignment Program. The audit team noted the following successful
practices and observations related to Program Management.
Successful Practice #1: Business Program Management (BPM) System
Interviewees overwhelmingly responded positively to questions
regarding the development and implementation of the BPM system. They
acknowledged the efforts by the developers and SEO to include the
following: virtual training sessions and demonstrations, creation of a
user's manual, PowerPoint handouts, and beta testing with Regional
Environmental Managers to work through ``bugs'' in the system.
Observation #1: Permitting Dashboard Reporting Procedures
Section 5.1.1 of the MOU subjects DOT&PF to the same procedural
requirements and substantive requirements that apply to the DOT
Secretary including, but not limited to Federal statutes or FHWA
policy. Per 23 U.S.C. 139 and Memorandum from Deputy Assistant
Secretary for Transportation Policy, Federal Permitting Dashboard
Reporting Standard, December 28, 2018, EA and Environmental Impact
Statement (EIS) project information is required to be entered in the
Federal Infrastructure Permitting Dashboard. The Permitting Dashboard
Reporting Standards require EIS's and EA's permitting timetables to be
entered in the dashboard: (1) within 90 days after the issuance of a
Notice of Intent for an EIS, or (2) the class of action determination
for an EA initiated after June 2016. Based on interviews, only one
project has been entered into the Permitting Dashboard, which FHWA
verified. Based on DOT&PF records, three projects should have been
entered into the Dashboard. The FHWA understands that DOT&PF does not
have written procedures regarding how to carry out these
responsibilities. Written procedures would provide opportunities for
consistent, timely, and compliant reporting of the projects required to
be in the dashboard.
Documentation and Records Management
Documentation and Records Management includes maintaining project
files and other recordkeeping (whether hardcopy or electronic)
pertaining to the DOT&PF's discharge of the responsibilities it has
assumed under the 23 U.S.C. 327 Program. From November 1, 2019, through
October 31, 2020, the DOT&PF made 228 project decisions. Through
employing both random and judgmental sampling procedures, the audit
team identified 47 project decisions to review.
Successful Practice #2: Tracking
Interviews with Section 106 Professionally Qualified Individuals
(PQI) revealed the use of an Excel database in at least one DOT&PF
region to track and manage Section 106 information for projects.
Tracking information on consultation letters, determinations of
eligibility, effect findings, SHPO concurrence, etc. allows the PQI to
stay on top of required tasks and ensure work is completed. Once
Section 106 consultation is completed, the PQI enters this data into
the SEO Access database tracking system that is used for the Section
106 Programmatic Agreement monitoring and annual reporting.
Observation #2: Documentation of Public and Agency Comments in CE
In 6 of 21 (28 percent) CE project files reviewed, there was
inadequate documentation of public and/or agency comments and
resolution of the comments. This is not in accordance with Chapter 4 of
the DOT&PF Highway Preconstruction Manual, which requires that CE Forms
``list the issues raised by the public and agencies and the manner in
which they were resolved.'' In addition, this observation appears to be
inconsistent with data reported in Section 9.2.2. (Maintain
completeness and adequacy of documentation of SEO records for projects
done under the program) of DOT&PF's 2020-2021 Self-Assessment Report.
Interview responses to questions about public involvement
requirements for CEs were varied. Some interviewees responded that they
follow the guidance in the Environmental Procedures Manual. Several
interviewees spoke to responding directly to commenters via emails or
letters and the potential for controversy to affect the class of action
decision. However, none specifically mentioned the need to document
comments and/or controversy and DOT&PF's responses to them on the CE
forms. The FHWA recommends that DOT&PF incorporate procedures for
documenting public involvement for CEs when appropriate into the EPM.
Quality Assurance/Quality Control
Under Section 8.2.4 of the MOU, DOT&PF agreed to carry out regular
QA/QC activities in accordance with the MOU and DOT&PF procedures
established to implement the NEPA Assignment Program. Based on the
information evaluated by the audit team, DOT&PF continues to carry out
regular QA/QC activities in accordance with the MOU. The FHWA believes
the BPM system provides more opportunity to augment data collection and
reporting for continued program improvement.
Observation #3: The State's Commitment of Adequate Resources and QA/QC
Performance
Sections 4.2.1 and 4.2.2 of the MOU outline the requirements for
the State's commitment of adequate resources to carry out NEPA
Assignment successfully. Moderate to high staff turnover has been a
recurring issue. This has been documented in Audit #1 report
Observation #3 and Audit #2 report Observation #3. In the January 2020
Self-Assessment Report, DOT&PF acknowledged the issue and indicated
that they will continue to track staffing impacts on the program
through the QA/QC process. During Audit #4, FHWA documented comments
from multiple DOT&PF staff in some of the regions concerning workload,
staffing, and turnover issues affecting QA/QC processes and observed a
downward trend in QA/QC performance (i.e., more errors and omissions in
NEPA approvals relative to the previous audit performance period). In
addition, interviews with SHPO suggested some of the Section 106
challenges, such as incomplete applications during Section 106
consultations, may be due to workload issues at DOT&PF. Despite these
observations, FHWA found that DOT&PF's implementation of the 327
Program was in substantial compliance with the MOU. The FHWA encourages
DOT&PF to continue to assess how workload, staffing, and turnover
issues might affect the level of compliance with the 327 MOU,
organizational performance for carrying out NEPA Assignment and overall
program delivery, and consider using tools like the BPM system,
resource sharing, increased use of consultants, and other approaches to
help address workload and staffing issues raised by some regions as
well as the QA/QC performance issues indicated in the most recent self-
assessment and observed by the audit team.
[[Page 66355]]
Training
Under Sections 12.1 and 12.2 of the MOU, the DOT&PF committed to
implementing training necessary to carry out the environmental
responsibilities assumed under the NEPA Assignment Program. The DOT&PF
also committed to assessing its need for training, developing a
training plan, and updating the training plan on an annual basis.
Observation #4: Training Needs Assessment
Considering ongoing staff turnover, as discussed in Observation #2,
FHWA encourages DOT&PF to conduct a detailed statewide training needs
assessment of all environmental staff. This will help DOT&PF allocate
resources more efficiently to identify skill and knowledge gaps. The
FHWA also encourages DOT&PF to explore cross training opportunities
with other agencies (e.g.: SHPO, BLM, USFS) and engage them in
development of their annual training plan.
Performance Measures
The FHWA and DOT&PF mutually established a set of performance
measures to evaluate DOT&PF's performance in assuming NEPA Assignment
Program responsibilities. The DOT&PF continues to collect, maintain,
and develop data towards monitoring its performance as required by
Section 10.1.3 of the MOU. The audit team noted the following
observation related to Performance Measures.
Successful Practice #3: Relationships With Agencies
The audit team found that DOT&PF has very good and positive
relationships with BLM, USFS, and SHPO. The FHWA has interviewed
resource agencies in previous audits and found that overall, they had
good working relationships with DOT&PF. The audit team decided to
interview staff from BLM and the USFS during Audit #4 since Federal
Land Management Agencies had not been interviewed in past audits and
they were included in DOT&PF's May 2020 agency poll. The team also
chose to interview SHPO since they had not been interviewed since Audit
#1. The individuals interviewed from these three agencies indicated
that overall, their working relationships with DOT&PF were very good
and positive. This information correlates well with the overwhelmingly
positive responses DOT&PF received to their agency poll.
Legal Sufficiency
Since 2017, the same attorney from the Alaska Attorney General's
Office, Transportation Section, has been assigned to the NEPA
Assignment Program. The assigned attorney has significant experience
with Federal-aid highway projects and the Federal environmental
process. The attorney works directly with DOT&PF staff on project
environmental documents. Based on the interviews, the attorney becomes
involved early in project development, normally reviewing a NEPA
document before receiving a formal request for a legal sufficiency
review. During the audit period, the attorney did not review an
environmental impact statement or a Section 4(f) evaluation requiring a
legal sufficiency review. Although a legal sufficiency review is not
required for EAs, the attorney reviewed two EAs during the audit
period. The review process for an EA is like the review process for an
EIS.
Department of Law Management stated during the interviews that
while one attorney is currently assigned to the program, should
workload increase significantly another attorney could be assigned to
NEPA work or litigation, likely through the utilization of outside
counsel per 23 U.S.C. 327(a)(2)(G).
The audit team finds that DOT&PF meets the legal sufficiency
determination and staffing requirements set forth in the DOT&PF
Environmental Procedures Manual.
Status of Observations From Audit #3 Report (April 2020)
This section describes the actions DOT&PF has taken in response to
observations made during the third audit.
Observation #1: Self-Assessment Procedures
The DOT&PF's 2018 NEPA Assignment Program Self-Assessment
Procedures require that SEO develop the preliminary and final Self-
Assessment report through coordination with, and input from, the
Regional Environmental Managers (REMs). During Audit #3 interviews, the
audit team found that DOT&PF did not develop the January 2020 Self-
Assessment report in accordance with their procedures, nor distribute
the final report to the regions. For Audit #4, DOT&PF indicated in
their responses to the PAIR that the draft December 2020 Self-
assessment was sent to the REMs for review and comment according to
their procedures. Comments were received and addressed in the final
Self-Assessment report, which was then shared with the regions.
Observation #2: Assessing Resource Agency Communication
Section 10.2.1 C. of the MOU requires DOT&PF to ``Assess change in
communication among DOT&PF, Federal and State agencies, and the public
resulting from assumption of responsibilities under this MOU''. The MOU
allows DOT&PF to determine the method it will use to assess this
change. The DOT&PF selected to use an annual resource agency poll. The
DOT&PF identified this measure in its DOT&PF NEPA Assignment Program
Performance Measures document located on its website. At the time of
Audit #3, DOT&PF had not yet used a resource agency poll, and FHWA
recommended that DOT&PF consider changing the method for reporting this
measure.
In May 2020 (prior to Audit #4), DOT&PF conducted an agency survey
to assess changes in communication among DOT&PF, State, and Federal
resource agencies. As described in DOT&PF's Self-Assessment Report, the
survey consisted of six questions distributed via an online platform to
a representative cross section of State and Federal resource Agency
staff. Twenty-four responses were received from 11 different resource
agencies. The DOT&PF asked the question: ``Has the level of
communication improved, declined, or remained the same since the MOU
became effective?'' Eleven of the responses indicated that there had
been an improvement in communication and the remaining responses
indicated there had been no change.
[FR Doc. 2022-23916 Filed 11-2-22; 8:45 am]
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