10 – Financial Plan
Financial plans for the MPOs’ TIPs are required per 450.326(j). Each MPO TIP must include a financial plan that demonstrates how the TIP can be implemented; indicates resources from public and private sources that are reasonably expected to be available to carry out the program; and identifies innovative financing techniques to finance projects, programs, and strategies.
The TIP financial plan can be as simple as providing a fiscal constraint table. As required by the Federal Highway Administration (FHWA)/Federal Transit Administration (FTA) Division Office, each MPO TIP must include a fiscal constraint table. These are needed so the federal agencies can be assured that fiscal constraint is demonstrated. A sample table is provided in Appendix E. For consistency and ease of federal review, NYSDOT asks that every MPO use the format for the fiscal constraint table that is provided in Appendix E. The Main Office will review fiscal constraint tables for sufficiency before the TIP goes out for public review.
The NYSDOT Regional Planning and Program Manager (RPPM) is the contact for the MPO on the planning target estimates to be used. Transit planning targets will be distributed separately by the Public Transportation Bureau.
Fiscal Constraint
Fiscal constraint for FHWA is defined as establishing a TIP/STIP such that the amount of total FHWA fiscally constrained funding programmed in each year of the TIP/STIP does not exceed the total planning targets for each of the TIP/STIP years. Any fiscally constrained fund type can be over-programmed in a year provided:
The total of all fiscally constrained funding programmed in that year does not exceed the planning targets (implies a columnar total of fund types must be under- programmed to compensate).
The total amount of fiscally constrained fund type that is programmed in the 4- year STIP period does not exceed the amount of that fund’s planning target during the 4- year STIP period. Totals in Rows (fund types) and columns (years) cannot be over- programmed.
Regional totals (TIPs and rural program) must be fiscally constrained by year and fund type for the STIP period. FHWA, FTA and NYSDOT consider TIP years beyond the first four (4) as only
informational.
For FTA Fiscal Constraint, refer to transit planning target estimates which will project apportionments through 2027. Appropriations bills are annually enacted, and apportionments and allocations are published by the FTA in the Federal Register. To maintain and document fiscal constraint, the FTA funds that are programmed on the TIP/STIP for a year need to be consistent with the amounts shown in the Federal Register for that year. Carryover balances of unobligated FTA transit funds should be reflected in the TIP fiscal constraint table as applicable. The Notice of Funding Availability (NOFA) limitations for FTA 5324 Emergency Relief should be followed.
All NYSDOT Regions, MPOs and transit Designated Recipients are expected to follow the regulations for fiscal constraint.
TIP Performance - Project Obligation Rates
FHWA will continue to review STIP performance. FHWA’s national goal is to see 75% of the construction phases programmed for obligation in a Federal Fiscal Year obligated by the end of that Federal Fiscal Year. NYSDOT will be enforcing fiscal constraint, and Regions and MPOs will not be permitted to program Federal-aid in excess of their planning targets by FFY. MPOs and Regions should be aware that not all transactions (e.g., close-outs and modifications) run through the TIP/STIP.
The following chart shows the GBNRTC TIP project obligation rate over the last 7 years. For the last 2 FFYs, the GBNRTC rate has exceeded the 75% obligation rate goal.
Year of Expenditure Dollars and Inflation Factors
Information on year of expenditure (YOE) dollars and inflation factors recommended by NYSDOT can be found below. Please note all projects’ costs on the TIP must be shown in year of expenditure dollars. MPOs that use inflation factors other than those recommended by NYSDOT for local projects must keep documentation on how they address YOE for their projects.
The following simple rates of inflation by State Fiscal Year (SFY) (April to March) are the best available estimates of overall price trends for the transport public works sector in New York State for the programming period:
The following multiplication factors reflect the simple rates of inflation stated above. They are used to convert SFY 2022 un-inflated cost estimates (in OPPM, Bridge Model, or Pavement Model) to be year of expenditure (YOE) inflated cost estimates (for the TIP, STIP and Governor’s Program), or vice versa:
Total Project Costs
Federal regulation 23 CFR 450.326(g) requires that inclusion of the estimated total project cost be included in the TIP/STIP. The TIP/STIP total project must also include project costs that are programmed prior to or beyond the TIP/STIP period.
Projects with an estimated total cost of $100M or more (cost in "year of expenditure" dollars) require an annual Financial Plan and all contingencies should be sufficiently detailed and managed.
Planning Targets
As in previous TIP/STIP Updates, NYSDOT is providing the attached targets for planning purposes only. The planning targets do not represent a commitment of funding on behalf of the Federal Highway Administration (FHWA) or the State.
Funding for select programs and recognized non-discretionary expenses are reserved prior to the apportionment of needs-based regional planning targets. These programsinclude Structure Inspections, 511NY, Traffic Signal Components, Rustic Rail, and centrally managed initiatives such as Statewide Highway Safety Improvement Program (HSIP), National Highway Freight Program (NHFP), and BRIDGE NY. In addition, a number of new programs have been added in the recently enacted BIL such as the Carbon Reduction Program and the Promoting Resilient Operations for Transformative, Efficient and Cost-saving Transportation (PROTECT) Program. These will be amended into the new STIP as federal guidance becomes available. Programs such as Surface Transportation Block Grant (STBG) set aside (formerly, Transportation Alternatives), Earmarks, Grade Crossing, Recreational Trails, Demonstration Funds, and other discretionary funding are considered non-allocated fund sources and are managed separately outside planning targets.
Rollover
On April 1, 2021, NYSDOT eliminated all positive and negative rollover balances for all fund sources. There are still rollover amounts leading into this program period but only over or under programing since April 1, 2021, will be considered.
Preventative Maintenance
All NYSDOT regions have received a preventive/corrective maintenance investment target for the state- owned system that reflects a mandated use of the overall planning target. There is no preventive/corrective maintenance target for the local program. While NYSDOT strongly encourages local municipalities to follow sound asset management principles, it is understood that local governments generally wish to use federal-aid for larger system renewal projects and use their own funds for preventive and corrective maintenance projects. NYSDOT Regions have developed their programs to meet the preventive/corrective maintenance target for the state system.
Innovative/Alternative Funding Sources
To meet the current and future demand for transportation improvements, funding resources beyond regional federal aid formula allocations will need to be investigated and considered. Finding new revenue sources is always challenging and support may only be achieved if there is a belief that the existing funds are being spent efficiently and providers of new financing are convinced that the benefits of the transportation investment exceed the additional cost. Some additional opportunities that could be considered include:
User-based revenue sources
Broadening the dedicated tax-based revenues
Public-Private partnerships
The fiscal constraint achieved in this plan also relies upon the successful application and award of federal discretionary funds to the region. To advance larger projects, federal discretionary grants such as RAISE have been and continue to be applied for. The Bipartisan Infrastructure Law has increased the number and amount of funding available in these discretionary grant opportunities.
Without these external innovative/alternative funding sources, many desirable projects will no longer be able to proceed.
Operations and Maintenance
NYSDOT and local GBNRTC members annually budget funds for operations and maintenance of transportation facilities including the federally supported system. In addition, both federal and state funds are provided to NYSDOT’s operations and maintenance forces for betterments to the system.
NYSDOT has provided regions with a preventive/corrective maintenance investment target for the state-owned system that reflects a mandated use of the overall planning target. There is no preventive/corrective maintenance target for the local program. While NYSDOT strongly encourages local municipalities to follow sound asset management principles, it is understood that local governments generally wish to use federal-aid for larger system renewal projects and use their own funds for preventive and corrective maintenance projects. NYSDOT Regions have developed their programs to meet the preventive/corrective maintenance target for the state system.
NY State Funding Program Budgets (SFY 21-22)
Specific maintenance/preservation activities include pavement and bridge maintenance, drainage improvements, guide rail repair, pavement markings, sign and signal maintenance, snow and ice control and numerous other maintenance activities.
NYSDOT also provides funds to localities for maintenance through the Consolidated Local Street and Highway Improvement Program (CHIPs), Extreme Winter Recovery (EWR), Pave our Potholes (POP) and State Touring Route Program.
The following are the State Fiscal Year (SFY) budgets (proposed 4/12/22) for GBNRTC local agency members. A description of each program can be found in Chapter 3.
Consolidated Local Street and Highway Improvement Program (CHIPS)
Erie County - $3,028,800
Niagara County - $740,700
City of Buffalo - $1,401,408
City of Niagara Falls - $482,194
PAVE NY
Erie County - $3,023,770
Niagara County - $742,314
City of Buffalo - $1,400,237
City of Niagara Falls - $481,800
Extreme Winter Recovery (EWR)
Erie County - $1,747,989
Niagara County - $419,997
City of Buffalo - $961,994
City of Niagara Falls - $334,301
Pave our Potholes (POP)
Erie County - $2,015,846
Niagara County - $494,876
City of Buffalo - $993,491
City of Niagara Falls - $321,200
State Touring Route Program (counties not eligible)
City of Buffalo - $8,699,797
City of Niagara Falls - $4,031,307
NYSDOT annually distributes Statewide Mass Transportation Operating Assistance (STOA) funds to approximately 130 transit operators. Niagara Frontier Transportation Authority (NFTA) is the principal recipient of these funds in Erie and Niagara Counties.
Annual Structure Inspection Costs
Bridges, including those on local roads, are integral elements of our highway systems. Despite their importance, however, they are often the most neglected components of the infrastructure. Demands on limited resources, especially competing roadway priorities for increased capacity and improved riding surfaces, too often result in deferred maintenance for bridges. The consequences are obvious -- bridges are deteriorating far faster than they are being repaired. Without adequate attention, many require replacement or closure long before they are really obsolete, further adding to the demand for limited funds, impacting safety, and discouraging both users and transportation providers.
Establishment of national bridge inspection standards and New York's Uniform Code of Bridge Inspection (NYCRR Part 165), both requiring that all structures more than 20 ft. long be inspected at least once every 24 months, have reduced the likelihood of catastrophic failure by mandating appropriate follow up after structural or safety citations.
The latest information provided by NYSDOT Region 5 on bridge inspection costs, including fund sources (in millions) is:
Non-Federal Funding
Project Match
Most federal funding programs only provide 80% of total project costs. The remaining 20% of project costs must come from non-federal sources.
The Municipal Streets and Highway Program, commonly referred to as the Marchiselli Program, was created as a means of assisting municipalities in financing the non-federal share of federally aided transportation projects. Under the program, Municipal Sponsors progressing projects on local highway systems through a federal-aid highway program may be eligible for State reimbursement of up to 75% of the non-federal share. Marchiselli Program funds may only be used for construction, reconstruction or improvement of local highways, bridges or highway-railroad grade crossings off the State Highway System. The project must have a ten (10) year minimum service life. The Marchiselli Program is the primary State aid matching program for locally administered FHWA-funded projects. Marchiselli Program funding is subject to annual appropriation in the State budget.
Below is a summary of how member agencies responded when asked about the source)s) of their local match:
City of Buffalo
City Capital Bonds, Consolidated Local Street and Highway Improvement (CHIPS) and Touring Route funds through the State, and various nonfederal grant funds (DASNY, ESD, etc.) are typically used by the City of Buffalo for the non-federal program match. The project type, scope and location often dictate the funds eligible to be used for non-federal match and the City of Buffalo programs the non-federal match funds accordingly.
Erie County
The local share funding for these projects engages both a budget process and a legislative process. Appropriation of Erie County’s local share for federal aid projects is in the annual County Budget for Special Projects. The actual monies for this local share are either bond monies or cash.
Niagara County
Niagara County typically uses budgeted capital funding or CHIPS money to cover the local share of our federally funded projects.
NYSDOT
NYSDOT uses State Dedicated Funds (SDF) to pay the non-federal project match.
Thruway Authority
Thruway Authority projects are funded using a variety of sources including the primary source of toll generated revenue. For a complete breakdown of funding sources please refer to the approved budget found at the following website https://www.thruway.ny.gov/about/financial/budgetbooks/index.html.
NFTA
NFTA projects that required non-federal match can be locally funded through multiple sources. The selection of funding can vary depending on location, type and scope. NFTA typically use budgeted capital funds for the non-federal match.
Local Projects
In addition to providing the required project match for federal-aid projects, the 2050 MTP estimated that local member agencies spend $17M a year on local (non MPO) transportation projects.
Transit Operating Assistance
Operating assistance provided by federal, state, and local governments for Metro operations of $244M is $84.1M or 52.6% above FYE 22. Operating assistance for BNIA operations is $10.5M.
Total Federal assistance of $139M is $54.8M, or 65.0% above FYE 22 levels, primarily due to an increase of COVID-19 relief funds to be recognized in FYE 23. Also included is $0.7M for miscellaneous Federal grants for operations in our Executive branch (Transit Police department.)
New York State Operating Assistance (STOA) is increasing $11.2M or 19.2%.
Local operating assistance is increasing 27.7% to $47M, reflective of more recent trends and projections.
Anticipated Future Expenditures and Resources
Many of our local streets, roads, bridges and highways were built decades ago and now require investments to rehabilitate, reconstruct and maintain them. Moving Forward 2050 will ensure that the region's infrastructure and services continue to function properly, safely and support the movement of people and goods-while at the same time prioritizing infrastructure that is both critical to the region, and supports the MTP goals.
Overall approaches to asset management and maintenance include: implementing systematic, aggressive road maintenance region-wide, with safety and technology upgrades; adopting advanced materials and construction techniques; and carrying out the Transit Asset Management Plan.
A Financial Plan assuring fiscal constraint is a key component of the Moving Forward 2050. Transportation plans encompass a number of projects that are to be implemented by a variety of organizations both public and private. All levels of government-federal, system. The fiscal constraint aspect of any regional transportation plan requires a financial plan be prepared so that the resulting plan can be used as a tool for the community to realistically establish priorities within the financial resources likely to be available. The plan must be fiscally constrained to the amount projected to be available to the region.
The following Financial Plan table Illustrates forecast revenues through 2050. The table also shows projected expenditures over that period, including system preservation needs, also detailed In Appendix, and expenditures per strategy. The table illustrates the balance between revenues and expenditures in Moving Forward 2050.
MTP Financial Plan
23 CFR § 450.324 (f) states that the metropolitan transportation planning process shall include a financial plan that demonstrates how the adopted transportation plan can be implemented.
The MPO, public transportation operator(s), and State shall cooperatively develop estimates of funds that will be available to support metropolitan transportation plan implementation, as required under § 450.314(a). All necessary financial resources from public and private sources that are reasonably expected to be made available to carry out the transportation plan shall be identified.
Fiscal Constraint of the GBNRTC TIP
Fiscal constraint remains a key component of program development and this transportation plan. Fiscally constrained means the region can only program projects for which revenues are reasonably expected to be available through federal, state, or local resources. Every effort has been made to assure revenue forecasts are reasonable and estimated project costs balance with those financial resources. Management controls are also in place to maintain fiscal integrity as projects advance.
Federal Regulation 23 CFR 450.326(k) states:
“For the TIP, financial constraint shall be demonstrated and maintained by year and shall include sufficient financial information to demonstrate which projects are to be implemented using current and/or reasonably available revenues, while federally supported facilities are being adequately operated and maintained. “
NYSDOT Region 5 works closely with the GBNRTC in the development of the MPO’s TIP and the Region’s portion of the STIP without a formal sub-allocation of planning targets to the MPO. NYSDOT has fiscal management tools available such as the use of Advanced Construction and the availability of fund source balances that gives them flexibility to accommodate some variations in fund source usage, and federal fund usage between years.
Should funding targets change during the life of the TIP, supplemental guidance will be issued from NYSDOT to implement changes. These changes will take place through the approved GBNRTC TIP Change Guidelines (5/21).
Subsequently, should NYSDOT planning targets decrease during the life of the TIP, existing projects will need to be modified/delayed in the current TIP in order to maintain fiscal constraint.
GBNRTC FHWA funding targets are calculated by:
Obtain regional planning targets from STIP Guidance
Add statewide funding allocations
Subtract funding for any project (named and funding blocks) located in Chautauqua or Cattaraugus Counties (non-MPO)
For FTA, NFTA programs their capital program based on actual FTA FFY22 appointments, with a 2 percent increase for each subsequent year.
The following table shows the overall fiscal constraint for NYSDOT Region 5.
The following table shows the regional federal (FHWA) allocations to NYSDOT Region 5.
The following table shows the statewide federal (FHWA) allocations to NYSDOT Region 5.
The following table shows non MPO NYSDOT Region 5 (FHWA) projects.
The following table shows the non MPO projects removed from regional FHWA targets. The result is an MPO-only fiscal constraint table.
FTA
For transit projects, NFTA programs their capital program based on FTA FFY22 appointments, with a 2 percent increase for each subsequent year.
As full published FTA federal apportionments become available for each FFY, NFTA will undergo a program realignment via approved TIP Change Guidelines.
Illustrative Projects
To maintain their respective TIPs in fiscal constraint and to show projects that meet local transportation needs, MPOs and Regions are allowed to include additional projects in their Plan, and as appropriate, in the TIP for inclusion in the STIP, for information as “illustrative projects”. [23 CFR 450. 326]. Illustrative projects are additional transportation projects that may (but is not required to) be included in a financial plan for a metropolitan transportation plan, TIP, or STIP if reasonable additional resources were to become available [23 CFR 450.104]. If a project is proposed to be included in the TIP for illustrative purposes, sufficient information is required to describe the project, excepting the resources. [§ 450.218] Illustrative Project total cost estimates can be a range.
GBNRTC Illustrative project listings can be found in Appendix 5