Surface Transportation Project Delivery Program; Ohio Department of Transportation Audit Report, 49973-49976 [2018-21565]

Agencies

• Federal Highway Administration
• DEPARTMENT OF TRANSPORTATION

[Federal Register Volume 83, Number 192 (Wednesday, October 3, 2018)]
[Notices]
[Pages 49973-49976]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-21565]


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DEPARTMENT OF TRANSPORTATION

Federal Highway Administration

[FHWA Docket No. FHWA-2018-0009]


Surface Transportation Project Delivery Program; Ohio Department 
of Transportation Audit Report

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

ACTION: Notice.

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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 the responsibilities it has assumed, in lieu 
of FHWA. This program mandates annual audits during each of the first 4 
years to ensure the State's compliance with program requirements. This 
notice makes available the final report of Ohio Department of 
Transportation's (ODOT) second audit under the program.

FOR FURTHER INFORMATION CONTACT: Mr. James G. Gavin, Office of Project 
Development and Environmental Review, (202) 366-1473, 
[email protected], or Mr. David Sett, Office of the Chief Counsel, 
(404) 562-3676, [email protected], Federal Highway Administration, 
U.S. Department of Transportation, 61 Forsyth Street 17T100, Atlanta, 
GA 30303. 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 responsibilities for environmental 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, in lieu of FHWA. The ODOT 
published its application for assumption under the NEPA Assignment 
Program on April 12, 2015, and made it available for public comment for 
30 days. After considering public comments, ODOT submitted its 
application to FHWA on May 27, 2015. The application served as the 
basis for developing the memorandum of understanding (MOU) that 
identifies the responsibilities and obligations that ODOT would assume. 
The FHWA published a notice of the draft MOU in the Federal Register on 
October 15, 2015, at 80 FR 62153, with a 30-day comment period to 
solicit the views of the public and Federal agencies. After the comment 
period closed, FHWA and ODOT considered comments and executed 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 results of each audit must be made available 
for public comment. The FHWA published a notice in the Federal Register 
on April 18, 2018, soliciting public comment for 30-days, pursuant to 
23 U.S.C. 327(g). This notice is available at 83 FR 17212. 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 Audit 2. The team has considered these 
comments in finalizing this audit report. This notice makes available 
the final report of ODOT's second audit under the program.

    Authority: Section 1313 of Public Law 112-141; Section 6005 of 
Public Law 109-59; 23 U.S.C. 327; 23 CFR 773.

    Issued on: September 26, 2018.
Brandye L. Hendrickson,
Deputy Administrator, Federal Highway Administration.

Surface Transportation Project Delivery Program

Final FHWA Audit of the Ohio Department of Transportation

August 6, 2016-August 4, 2017

Executive Summary

    This is the second audit of the Ohio Department of Transportation's 
(ODOT) assumption of National Environmental Policy Act (NEPA) 
responsibilities, conducted by a team of Federal Highway Administration 
(FHWA) staff (the team). The ODOT made the effective date of the 
project-level NEPA and environmental review responsibilities it assumed 
from FHWA on December 28, 2015, as specified in a

[[Page 49974]]

memorandum of understanding (MOU) signed on December 11, 2015. The ODOT 
delegated these responsibilities to ODOT representatives located in the 
Division of Planning. This audit examined ODOT's performance under the 
MOU regarding responsibilities and obligations assigned therein.
    Prior to the on-site visit, the team performed reviews of ODOT's 
project NEPA approval documentation in EnviroNet (ODOT's official 
environmental document filing system). This review consisted of a 
statistically valid sample of 92 project files out of 736 approved 
documents in ODOT's EnviroNet system with an environmental approval 
date between May 31, 2016, and March 31, 2017. The team also reviewed 
ODOT's response to the pre-audit information request (PAIR) and ODOT's 
Self-Assessment report. In addition, the team reviewed ODOT's 
environmental processes, manuals, and guidance; ODOT NEPA Quality 
Assurance and Quality Control (QA/QC) Processes and Procedures; and the 
ODOT NEPA Assignment Training Plan (collectively, ``ODOT procedures''). 
The team conducted interviews with ODOT's Central Office during the on-
site portion of the review from July 31 to August 4, 2017. The team 
interviewed the resource agencies the week prior to the on-site review.
    Overall, the team finds ODOT continues to make reasonable progress 
in implementing the NEPA Assignment Program. The team found one non-
compliance observation that will require ODOT to respond with 
corrective action by its next self-assessment and subsequent report. 
The team also noted five general observations and three successful 
practices.

Background

    The Surface Transportation Project Delivery Program (NEPA 
Assignment Program) allows a State to assume FHWA's responsibilities 
for review, consultation, and compliance with environmental laws for 
Federal-aid highway projects. When a State assumes these 
responsibilities, it becomes solely responsible and liable for carrying 
out the responsibilities assumed, in lieu of FHWA.
    The State of Ohio represented by ODOT completed the application 
process and entered into an MOU with FHWA effective on December 28, 
2015. With this agreement, ODOT assumed FHWA's project approval 
responsibilities under NEPA and NEPA-related Federal environmental 
laws.
    The FHWA is obligated to conduct four annual compliance audits of 
the ODOT's compliance with the provisions of the MOU. Audits serve as 
FHWA's primary mechanism of overseeing ODOT's compliance with 
applicable Federal laws and policies, evaluate ODOT's progress toward 
achieving the performance measures identified in the MOU, and collect 
information needed for the Secretary's annual report to Congress.
    This audit is the second completed in Ohio. The third audit is 
scheduled for 2018.

Scope and Methodology

    The team conducted a careful examination of the ODOT NEPA 
Assignment Program through a review of ODOT procedures and project 
documentation, ODOT's PAIR response, and the self-assessment summary 
report, as well as interviews with ODOT Central Office and district 
environmental staff and resource agency staff. This review focuses on 
the following six NEPA Assignment Program elements: (1) Program 
management, (2) documentation and records management, (3) QA/QC, (4) 
legal sufficiency, (5) performance measurement, and (6) training.
    The PAIR consisted of 22 questions, based on responsibilities 
assigned to ODOT in the MOU. The team reviewed ODOT's response, and 
compared the responses to ODOT's written procedures. The team utilized 
ODOT's responses to draft interview questions to clarify information in 
ODOT's PAIR response.
    The ODOT provided its NEPA Assignment Self-Assessment summary 
report 30 days prior to the team's on-site review. The team considered 
this summary report both in focusing on issues during the project file 
reviews and in drafting interview questions. The report was compared 
against the previous year self-assessment report and the requirements 
in the MOU to identify any trends.
    Between April 21 and June 5, 2017, the team conducted a project 
file review of a statistically valid sample of 92 project files 
representing ODOT NEPA project approvals in ODOT's online environmental 
file system, EnviroNet with an environmental approval date between May 
31, 2016, and March 31, 2017. The sample size of 92 projects was 
calculated using a 90 percent confidence interval with a 10 percent 
margin of error. The projects reviewed represented all NEPA classes of 
action available, all 12 ODOT Districts and the Ohio Rail Development 
Commission (ORDC).
    During the on-site review week, the team conducted interviews with 
37 ODOT staff members at the central office and three districts: 
District 1 (Lima); District 11 (New Philadelphia); and District 12 
(Cleveland). Interviewees included District Environmental Coordinators 
(DEC), environmental staff, and executive management, representing a 
diverse range of expertise and experience. The interviews at the ODOT 
Districts included a discussion with staff regarding NEPA Assignment.
    The team conducted interviews the week prior to the on-site review 
with personnel from the Ohio Environmental Protection Agency Division 
of Air Pollution Control, U. S. Environmental Protection Agency (EPA) 
Region V Office, and the Ohio Historic Preservation Office. These 
agencies provided valuable insight to the team regarding ODOT's 
performance and relationships with partner resource agencies.
    The team identified gaps between the information from the desktop 
review of ODOT procedures, PAIR, self-assessment, project file review, 
and interviews. The team documented the results of its reviews and 
interviews and consolidated the results into related topics or themes. 
From these topics or themes, the team developed the review observations 
and successful practices. The audit results are described below.
    Overall, the team found evidence that ODOT made reasonable progress 
in implementing the NEPA Assignment Program based on the Audit 1 
observations and demonstrated commitment to success of the program. The 
team found one non-compliance observation that will require ODOT to 
respond with corrective action by its next self-assessment and 
subsequent report. The team also noted five general observations and 
three successful practices.
    The FHWA expects ODOT to develop and implement timely corrective 
action to address the non-compliance observation. In addition, based on 
the observations noted below, the team urges ODOT to consider 
improvements in order to build upon the early successes of its program.

Observations and Successful Practices

Program Management

Observation 1: Implementation of ODOT policy, manuals, procedures, and 
guidance is inconsistent across the State, particularly involving local 
governments and consultants.

    The team noted inconsistencies in the application of various ODOT 
procedures in project file reviews. These inconsistencies were 
particularly apparent in documents produced and

[[Page 49975]]

actions taken by Local Public Agencies (LPA) and consultants, likely 
due to variability in these outside parties' understanding of ODOT 
procedures and requirements in areas such as public involvement (PI) 
and environmental justice (EJ). Inconsistencies included items such as 
not initiating contact with emergency and public services as part of PI 
during the NEPA process and a failure to include EJ forms in project 
files.
    The ODOT representatives reported in response to interviews that 
they have already taken action to train LPA and consultant staff in 
response to this observation. The ODOT staff said that they moved 
registration for the environmental training program from their office 
to the Office of Local Technical Assistance Program and the result was 
greater visibility and exposure of environmental training opportunities 
for the LPAs. The ODOT representatives are hopeful the additional focus 
on training will mitigate any inconsistencies in their program.

Successful Practice 1: ODOT has effective program management processes 
in place resulting in successful project delivery.

    In the 2 years since ODOT has assumed NEPA responsibilities, ODOT 
has approved more than 1000 NEPA actions. Since Audit 1, ODOT undertook 
measures to solidify its program management approach. The ODOT 
representatives assigned subject matter experts with responsibility for 
ODOT's procedures in their subject areas providing a sense of ownership 
and allowing for ODOT to stay current in its program management 
responsibilities. The ODOT developed and implemented over 140 
procedures to document how to implement NEPA Assignment, manage the 
program, and provide detailed instruction for completion of 
environmental actions to document preparers and reviewers. The ODOT 
implemented a quarterly update system for new or revised ODOT 
procedures using a listserv approach and a single Web-based repository 
of all guidance to share information. The ODOT continues to use routine 
statewide NEPA chats and DEC Meetings to share updated information with 
NEPA practitioners and to hear concerns from the field. Lastly, ODOT is 
committed to continued process improvements to refine areas of noted 
deficiency.

Documentation and Records Management

Non-Compliance Observation 1: Disclosure language required by Sections 
3.1.2 or 3.1.3 of the MOU was missing from project materials and 
documents.

    The team identified 10 project files where PI materials lacked the 
required disclosure language required in MOU Sections 3.1.2 or 3.1.3. 
The disclosure in both sections states, ``The environmental review, 
consultation, and other actions required by applicable federal 
environmental laws for this project are being, or have been, carried-
out by ODOT pursuant to 23 U.S.C. 327 and a Memorandum of Understanding 
dated December 11, 2015 and executed by FHWA and ODOT.'' In addition to 
these 10 projects, ODOT identified 9 additional projects in which 
various other documents lacked the required disclosure language, as 
part of its self-assessment.
    The projects identified by FHWA came from 8 of ODOT's 12 Districts 
and included both ODOT and LPA projects. The projects identified by 
ODOT have a similar distribution among districts and project sponsors. 
The team considers this problem to be systemic across Ohio, identified 
in about 20 percent of the FHWA sample.
    The team acknowledges that ODOT has already developed an action 
plan to address this issue, including the following:
     In support of NEPA Assignment, ODOT has issued over 140 
pieces of guidance, manuals or instructions on ODOT's process and 
implementation of the NEPA Assignment Program. The ODOT will review 
guidance that references this section of the MOU and ensure that there 
are no changes that we could make to better provide direction or 
guidance to our teams on how to comply with this requirement.
     The MOU Section 3.1.3 requirement is already a part of 
several of ODOT environmental training classes, including the PI class, 
Categorical Exclusion (CE) class, 1-Week NEPA class, among others. 
However, ODOT will review these classes to ensure Section 3.1.3 
requirements are included and seek to include this compliance area into 
other classes.
     In addition, ODOT will make this area a renewed focus at 
our NEPA chats and DEC meetings. Both of these events are training 
events with all of ODOT's environmental staff, statewide. In addition, 
this topic will be presented to our consultant teams at our next 
Consultant Environmental Update Meeting and our Ohio Transportation 
Engineering Conference (OTEC). Lastly, ODOT will look for opportunities 
to increase outreach to our LPA's on this subject. The ODOT will keep 
working to improve our overall performance in this area.

Observation 2: Project-level compliance issues were identified in four 
areas: Public Involvement, Environmental Justice, Environmental 
Commitments, and Fiscal Constraint. In addition, instances were 
identified where the information included in the online environmental 
file did not comply with ODOT standards.

    The FHWA identified project-level compliance issues on 17 projects 
in 4 areas in Audit 2. Three areas were identified in both Audit 1 and 
Audit 2 (i.e., PI, EJ, and environmental commitments) and one was a new 
area of issue in the current audit (i.e., fiscal constraint). Three of 
the areas in need of improvement from the FHWA Audit 1 (i.e., 
floodplains, Wetlands Findings per E.O. 11990, and Section 4(f)) were 
not identified in this audit, as shown in Table 1. As a result of the 
first FHWA audit and ODOT's first self-assessment, ODOT updated many 
procedures relating to the NEPA process and NEPA Assignment to improve 
its processes and meet Federal requirements. This may be a contributing 
factor to the changes in the areas in need of improvement identified in 
FHWA Audit 1 and FHWA Audit 2
    The ODOT's second Self-Assessment summary report also identified 
PI, EJ, and environmental commitments as areas of needed improvements 
and fiscal constraint as a compliance issue. During Audit 2, ODOT 
informed FHWA about planned changes and improvements to EnviroNet that 
should address some of the errors identified in the FHWA project file 
review.

       Table 1--Areas With Project-Level Compliance Issues by Year
------------------------------------------------------------------------
                                        FHWA Audit 1      FHWA Audit 2
                Area                       (2016)            (2017)
------------------------------------------------------------------------
Public Involvement..................  [check]           [check]
Environmental Justice...............  [check]           [check]
Environmental Commitments...........  [check]           [check]
Fiscal Constraint...................                    [check]
Floodplains.........................  [check]
Wetlands Findings per E.O. 11990....  [check]
Section 4(f)........................  [check]
------------------------------------------------------------------------

    In addition, FHWA identified issues with project file management in 
both Audit 1 and Audit 2. The ODOT also identified project file 
management as an

[[Page 49976]]

area in need of improvement through its Self-Assessment summary 
reports. For example, the team could not find required documentation in 
the Project File Tab even though there were indications that a related 
task was completed. The areas under which the errors occurred, include, 
but are not limited to PI, EJ, environmental commitments, maintenance 
of traffic, and fiscal constraint. The projects identified represent 
all ODOT's 12 districts and included ODOT, ORDC, and LPA projects.
    The team considers these to be project level compliance issues 
because, although documentation expected to be in the project file was 
missing, the files generally contained indications that the necessary 
review or commitments were being implemented. The team strongly 
encourages ODOT to continue improvements to EnviroNet and ODOT 
procedures to ensure complete documentation and compliance on future 
projects. The FHWA will more closely review these project level 
compliance issues in its next Audit review.

Quality Assurance/Quality Control (QA/QC)

Observation 3: There are variations in awareness, understanding, and 
implementation of QA/QC process and procedures.

    The inconsistencies and missing information so far described are an 
indication that ODOT's QA/QC process requires attention. The interviews 
revealed that middle and upper management at the districts are not 
involved in the QA/QC process. The ODOT District environmental staff 
and non-environmental staff said that they rely on the ODOT Central 
Office to be the final backstop for QA/QC. However, most district staff 
indicated a lack of awareness or understanding of the overall QA/QC 
process. No training is provided exclusively for QA/QC.

Successful Practice 2: EnviroNet serves as QA/QC in terms of process 
and consistency.

    Interviews with district and ODOT Central Office staff indicated 
that, overall, EnviroNet has changed the NEPA review process for the 
better and represents a ``one-stop shop'' for documentation of the NEPA 
process. The ODOT staff indicated that with everything now on-line, 
including electronic signatures, communication is easier between ODOT, 
the LPAs and consultants. The use of drop down menus and response 
selections within the project file resource areas acts as QC, creating 
increased standardization and consistency statewide.
    The system of checks built into the system includes error messages 
and a hard stop of the project if a peer review is required and not 
completed. Another safeguard of EnviroNet is ``validation'' which 
instigates a hard stop if required fields are not filled in the project 
file. There are security protocols to allow access to the appropriate 
staff for project file review and input, peer review and ultimately 
approval officials.

Legal Sufficiency Review

    To date, ODOT has not applied the ``ODOT NEPA Assignment Legal 
Sufficiency Review Guidance'' guidance because it did not have any 
documents that required legal sufficiency review. There are no 
observations to report at this time.

Performance Measures

Observation 4: Some of ODOT's performance measures are ineffective.

    The ODOT developed Performance Measures as required in MOU Section 
10.2 to provide an overall indication of ODOT's execution of its 
responsibilities assigned by the MOU. The team urges ODOT to refine or 
revise performance measures to reveal any occasional or ongoing 
challenges in agency relationships as well as any possible need to 
adjust approaches to QC.

Training Program

    The ODOT has a robust environmental training program and provides 
adequate budget and time for staff to access a variety of internal and 
external training. The ODOT updated its training plan in January 2017, 
and provided the plan to FHWA and resource agencies for their review, 
as required by Section 12.2 of the MOU. The training plan includes both 
traditional, instructor-based training courses and quarterly DEC 
meetings as well as monthly NEPA chats, where ODOT Central Office staff 
can share new information and guidance with district staff, including 
interactive discussions on the environmental program. Furthermore, the 
training plan includes a system to track training needs within ODOT. In 
addition, ODOT holds bi-annual meetings with consultants to provide on-
going updates about the environmental program.

Successful Practice 3: ODOT continues the practice of required and 
continuous training of both staff and consultants involved in the 
environmental process.

    The ODOT's training plan states that all ODOT environmental staff 
(both central and district offices) and environmental consultants are 
required to take the pre-qualification training courses. Staff is also 
encouraged to take training offered beyond the minimum required 
training. All staff interviewed indicated that ODOT management fully 
supports required training of staff and consultants.

Observation 5: Opportunities exist for expanding training in 
Environmental Justice (EJ).

    Currently, ODOT's training plan does not include a stand-alone 
training course on EJ. In the Self-Assessment summary report, ODOT 
identified EJ as an area needing improvement. This observation and that 
the team found project level compliance issues related to EJ indicate 
that additional attention should be paid by ODOT to EJ compliance. The 
FHWA encourages ODOT to include specific EJ training opportunities in 
its training plan, such as the Web-based course currently under 
development, and other EJ courses offered by the National Highway 
Institute, the FHWA Resource Center, and/or the EPA.

Finalization of Report

    The FHWA received one response to the Federal Register Notice 
during the public comment period for this draft report. This response, 
from the American Road & Transportation Builders Association, was 
supportive of the Surface Transportation Project Delivery Program and 
did not relate specifically to Audit 2. This report is a finalized 
draft version without substantive changes.

[FR Doc. 2018-21565 Filed 10-2-18; 8:45 am]
 BILLING CODE 4910-22-P