"Program To Permit Cost-Sharing of Air Traffic Modernization Projects Guidance 2005"

Friday, January 28, 2005

Program To Permit Cost-Sharing of Air Traffic Modernization Projects
Guidance 2005
The Federal Register


DATES: The FAA's Vice President for Finance may receive initial
sponsors' expressions of interest at any time in fiscal year 2005.
While the agency has no proposal submission deadline, potential sponsors are
encouraged to submit proposals as soon as possible.

ADDRESSES: Sponsors' expressions of interest/proposal should be mailed
or delivered, in duplicate, to the Federal Aviation Administration, Director
of Capital Expenditures Programs, 800 Independence Avenue, SW., Washington,
DC 20590. Electronic submissions will be accepted, but must be followed up
with a signed paper copy within five working days, to the address listed
above. The electronic submissions should be mailed to Chris.Witt@xxxxxxxx
Deliveries may be made between 8:30 a.m. and 5 p.m. weekdays, except Federal
holidays.

FOR FURTHER INFORMATION CONTACT: Chris Witt of the Finance Capital
Expenditure Directorate Federal Aviation Administration, 800 Independence
Avenue, SW., Washington, DC 20590; telephone (202) 267-7646.

SUPPLEMENTARY INFORMATION: In performing its mission of providing a safe and
efficient air transportation system, the FAA operates and maintains a
complex air traffic control system infrastructure. Vision 100, Section 183
authorizes a program to permit cost-sharing of air traffic modernization
projects, under which major users of the national aerospace system, which
includes a public use airport or airport/airline joint ventures, may procure
and install facilities and equipment in cooperation with the FAA. The
program is intended to allow project sponsors to achieve accelerated
deployment of eligible facilities or equipment, and to help expand aviation
infrastructure.

The FAA is authorized to approve up to 10 projects per year under Vision
100, Section 183. Those sponsors whose projects were approved in the AIR 21
pilot program may submit additional proposals under the new authorization.
All sponsors who anticipate submitting a request should review the criteria
in sections 2.1 and 2.2 before submission.

2. Program Guidance

This section provides the statutory language sponsor eligibility of Vision
100 section 183 and outlines FAA's supplementary criteria for the cost share
program. The sponsor eligibility, project eligibility, and evaluation and
screening criteria are outlined in Sections 2.1, 2.2 and 2.6 respectively of
this guidance.

2.1 Eligible Project Sponsors

2.1.1 Statutory Provisions of Vision 100 for Sponsor Eligibility

A project sponsor means any major user of the National Airspace System as
determined by the Secretary, including a public-use airport or a joint
venture between a public-use airport and one or more U.S. air carriers.

2.1.2 Supplementary FAA Criteria for Sponsor Eligibility

An eligible project sponsor is any major user of the national airspace
system including public-use airport (or group of airports), either publicly
or privately owned, acting on its own or in a joint venture with one or more
U.S. air carriers. All landing facilities meeting these criteria are
eligible, including but not limited to commercial service airports, reliever
airports, general aviation airports, and heliports. Eligibility is not
limited to airports; other National Airspace System (NAS) major users such
as state or regional aviation activities may be eligible.

All eligible sponsors are encouraged to participate. If selected for the
program, the sponsor must be willing to enter into a Memorandum of Agreement
with the FAA outlining the specific goals to be accomplished, the roles and
responsibilities of each party, schedule milestones, and funding
contributions of the parties. An eligible sponsor must have an available
source of funds to execute the program.

2.2 Eligible Projects

2.2.1 Statutory Provisions for Project Eligibility

The term 'eligible project' means a project to purchase equipment
or software relating to the Nation's air traffic control system that is
certified or approved by the Administrator of the Federal Aviation
Administration and that promotes safety, efficiency, or mobility. Such
projects may include:

a. Airport-specific air traffic facilities and equipment, including local
area augmentation systems,* instrument landings systems, weather and wind
shear detection equipment, and lighting improvements;

b. Automation tools to effect improvements in airport capacity, including
passive final approach spacing tools and traffic management advisory
equipment; and

c. Equipment and software that enhance airspace control procedures or assist
in en route surveillance, including oceanic and offshore flight tracking.

* Note these projects will be eligible, assuming availability and viability
of the equipment within the time limitation highlighted in 2.2.2.c.

2.2.2 Supplementary FAA Criteria for Project Eligibility

a. Projects should align with the FAA's strategic Flight Plan goals.

b. The project should be consistent with FAA's air traffic equipment/systems
infrastructure and architecture and should be a validated project of a FAA
program. The project, when commissioned, should provide measurable benefits
that benefit national, regional, or local objectives/interests and the FAA
NAS.

c. The project shall be initiated within one year of project approval and
completed/commissioned within five years of project approval (allowing for
an environmental impact study (if necessary), acquisition, supply support,
training programs, etc.).

d. Equipment and facilities should meet applicable FAA advisory circulars
and specifications.

e. The project should serve the general welfare of the flying public; it
should not be used for the exclusive interest of a for-profit entity.

f. Any facility/equipment acquired under the project should be a new asset,
not an asset that the sponsor has already acquired or is committed to
acquiring.

g. The project should have a useful and expected life of ten years or more,
notwithstanding the possible need to replace project components during its
operating life.

h. The cost-share program is not the correct forum for requesting
development of RNAV procedures.

i. A sponsor may submit a multiple component project proposal (as outlined
in paragraph 2.5) where each component forms part or all of an integrated
system. The FAA reserves the option to accept one or multiple components of
a proposal.

j. A project may not be co-mingled with other FAA cost-sharing programs.

k. All equipment and facilities should meet appropriate OSHA standards for
employee safety and fire protection. Where land is involved, the property
should meet all environmental compliance requirements, including noise,
hazardous material, property access, and zoning rights.

2.3 Funding

2.3.1 Statutory Provisions for Funding

The Federal share of the cost of an eligible project carried out under the
program shall not exceed 33 percent. No project may receive more than
$5,000,000 in Federal funding. The sponsor's share of the cost of an
eligible project shall be provided from non-Federal sources, including
revenues collected pursuant to Title 49, United States Code 40117.

2.3.2 Supplementary FAA Criteria for Funding

FAA is not obligated to fund one-third of the total project costs; rather,
FAA's share may not exceed this threshold. The project sponsor must provide
two-thirds or more of the total project cost. The Federal and non-Federal
shares of project cost may take the form of in-kind contributions. Equipment
in FAA's inventory that has not been previously deployed qualifies as
eligible equipment. If selected for the program, a sponsor may use passenger
facility charge (PFC) revenues to acquire and install eligible facilities
and equipment, but not to fund their operation or maintenance. Normal PFC
processing procedures under Federal Aviation Regulation 14 CFR part 158 will
be used to approve the imposition of a PFC or the use of PFC revenue as the
non-Federal share of a program project.

Federal contributions applied to any other Federal project or grant may not
be used to satisfy the sponsor's cost share under this program.

The following criteria apply to the calculation of the cost-sharing ratio:

a. Project costs are limited to those costs that the FAA would normally
incur in conventional facilities and equipment funding (e.g., if
land/right-of-way must be acquired or leased for a project, its cost can be
included in the cost-sharing ratio only if FAA would otherwise incur it in
conventional program funding).

b. Operations and maintenance costs of the project, both before and after
any sponsor-elected project transfer to the FAA, will not be considered as
part of the cost-share contribution. However, these costs must be
identified.

c. Non-Federal funding may include cash, substantial equipment contributions
that are wholly utilized as an integral part of the project, and personnel
services dedicated to the proposed project prior to commissioning, as long
as such personnel are not otherwise supported with Federal funds. The
non-Federal cost may include in-kind contributions (e.g., buildings).
In-kind contributions will be evaluated as to whether they present a cost
that FAA would otherwise incur in conventional facilities and equipment
funding.

d. Aside from in-kind contributions, only funds expended by the sponsor
after the project approval date will be eligible for inclusion in the
cost-sharing ratio.

e. Unless otherwise specified by these criteria, the principles and
standards for determining costs should be conducted in accordance with OMB
Circular A-87, Cost Principles for State, Local, and Indian Tribal
Governments.

f. As with other U.S. DOT cost-sharing grants, it is inappropriate for a
management/administrative fee to be included as part of the sponsor's
contribution. This does not prohibit appropriate fee payments to vendors or
others that may provide goods or services to support the project.

FAA funding decisions will be based on the project evaluation and project
selection processes discussed later in this notice.

The U.S. Department of Transportation and the Comptroller General of the
United States have the right to obtain and assess all documents pertaining
to the use of Federal and non-Federal contributions for selected projects.
Sponsors should maintain sufficient documentation during negotiations and
during the life of the project to substantiate costs.

2.4 Transfer of Facility or Equipment to FAA

2.4.1 Statutory Provisions for Facility or Equipment Transfer

Notwithstanding any other provision of law, and upon agreement by the
Administrator, a project sponsor may transfer, without consideration, to the
FAA, facilities, equipment, and automation tools, the purchase of which was
assisted by a grant made under this section if such facilities, equipment or
tools meet Federal Aviation Administration operation and maintenance
criteria.

2.4.2 Supplementary FAA Criteria for Facility or Equipment Transfer

Project transfers to the FAA will be at the sponsor's election and in
accordance with the criteria listed below.

a. At the time of transfer, the project should be operable and maintainable
by the FAA and should comply with FAA Order 6700.20, Non-Federal
Navigational Aids and Air Traffic Control Facilities, or any successor Order
then in effect.

b. In the event of transfer, software code, data rights, and support tools
should be provided to the FAA at no cost to the FAA.

If the project is not transferred to the FAA, the sponsor remains liable for
all operations and maintenance costs, including the costs of capital
sustainment.

2.5 Application Procedures

Unlike the cost share pilot program, for this fiscal year all applications
will be reviewed upon receipt and selected based upon individual merit and
alignment with the FAA's goals and objectives as outlined in the strategic
planning documents. The statutory limit is ten projects per fiscal year. The
following application procedures will be used when applying for cost-share:

a. The purpose of the application is provide sufficient information to
conduct detained analysis that evaluates cost, benefits, risk, alignment
with strategic direction of the proposed project and to compare the proposal
with other NAS needs. It is suggested that the sponsor contact the FAA's
cost share office to discuss the potential project before the applicant
expends excessive resources on the project application.

b. Eligible sponsors may submit multiple projects and projects with multiple
components, but each piece of equipment/activity must be identified and
costed separately, with appropriately defined benefits and should be listed
in priority order. An example of a multiple component project would be an
instrument landing system (ILS) project that may include in addition to the
ILS equipment, middle markers and runway lighting for a complete package.
The FAA reserves the option to accept one or multiple pieces of each
proposal.

c. Projects that would be good candidates for this program may include
equipment and systems that monitor weather, support runway incursion
reduction, and support regional interest.

d. Under this program, either the FAA or the sponsor may acquire and/or
install facilities or equipment. In the case where the FAA manages the
procurement, existing FAA contracts will be used where possible.

e. Proposals for new air traffic control towers will only be considered if
they enhance the National Airspace System. Per FAA Order 6030.1, FAA Policy
on Relocation, movement of an existing air traffic control tower for the
convenience/benefit of only the airport will not be considered. Requests for
towers will be considered utilizing the criteria in Order 7031.2C, Airway
Planning Standards Number One (APS-1).

2.5.2. Formal Application and Selection of Projects

The proposal should not be more than thirty pages in length. During the
evaluation process each sponsor should submit an application with the
following elements needed by the FAA to evaluate the merits of the
application.

a. Project Description: The project description should contain: (1) The
identity of the submitting sponsor (including point-of-contact's name,
mailing address, telephone number, fax number, and e-mail address) and all
participating authorities or entities in the case of joint ventures; (2)
project name and location; and (3) a detailed project description. In
addition, the sponsor must provide a statement of intent to transfer the
project to the FAA, including anticipated transfer date, or intent not to
transfer the project to the FAA.


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