Freight Grant Program Needs Greater Transparency: Congressional Leaders

By Shaun Courtney

Bipartisan leaders of the House Transportation and Infrastructure Committee are calling for ongoing oversight of targeted freight infrastructure grants, such as for highways and bridges, after a Nov. 2 GAO report faulted the transparency of the Transportation Department program.

The FASTLANE grants, an acronym for Fostering Advancements in Shipping and Transportation for the Long-Term Achievement of National Efficiencies, were created under the Fixing America’s Surface Transportation (FAST) Act in 2015. DOT was tasked with awarding $4.5 billion in discretionary grants for fiscal years 2016 through 2020.

The Government Accountability Office reviewed the $759.2 million in fiscal year 2016 grants, as was required under the FAST Act. The GAO was “unable to determine the rationale for selecting the 18 awarded projects,” according to the report.

An August Bloomberg Government analysis of the 10 small project grants awarded in fiscal 2017 by the Trump administration showed that each of the grants was awarded to areas represented in Washington by a well-placed member of Congress—a member of an authorizing or appropriations panel; in a politically significant state or county; or both. All the fiscal 2017 grants were awarded after Trump took office.

“It’s critical that the Department, regardless of the administration, carry out this program as Congress intended, and that these competitive grants be evaluated and selected in a fair and transparent manner,” said Transportation and Infrastructure Committee Chairman Bill Shuster (R-Pa.), ranking member Peter DeFazio (D-Ore.), Highways and Transit Subcommittee Chairman Sam Graves (R-Mo.), and subcommittee ranking member Eleanor Holmes Norton (D-D.C.) in a joint statement.

The GAO released its report the same day applications were due for the fiscal 2017 Large Projects and fiscal 2018 Large and Small Projects.

Transparency Needed

The GAO report criticizes inconsistencies in project evaluations and justifications for selection.

Lower-rated projects were advanced for further review based on vague statements, to include one project where a senior review members said, “the applicant has been a good partner,” according to the GAO.

Even when there were ratings to consider, they weren’t necessarily the basis for final decision-making.

“DOT officials told us that project selection was not based on project ratings, but rather was determined by the Secretary, who could choose any of the projects on the list of projects for consideration,” the GAO reported.

While the GAO’s findings are based on 2016 grant selections, Bloomberg Government reported in August the same standard held under the Trump administration.

“Ultimately, it is the Secretary who selects the projects for whom to propose awards,” the DOT said in a written statement to Bloomberg Government in August.

Impact on Applicants

The Obama administration solicited the first round of FASTLANE grants in March 2016 and applications were due just over a month later, by mid-April 2016.

“It was a very, very, very short time frame. So we tried to do the best possible application in the time frame that we had,” Roberta Dwyer, the Twin Ports Interchange Project Manager at the Minnesota Department of Transportation, told Bloomberg Government.

The Twin Ports Interchange project would ease freight traffic congestion from the major inland port of Lake Superior in Duluth, Minn., and along a stretch of highway that connects Minnesota and Wisconsin.

The first application for the project wasn’t successful, in part because Minnesota officials requested the full project funding requirement of more than $200 million, Dwyer said.

After missing out the first time, the team reviewed the merits of the awarded grants and tried again when the Obama administration issued a second notice of funding in late 2016.

Minnesota “tailored” its application with the benefit of time and lessons learned from previous successful grants, Dwyer said. The project still wasn’t selected from that second group, however.

Dwyer’s team once again tweaked the application to meet the priorities of a new administration and submitted it by the Nov. 2 deadline. The FASTLANE program was renamed INFRA and reconfigured under the Trump administration.

How to Improve

GAO made three recommendations to DOT:

  •  Develop an evaluation plan that clearly defines how review teams apply criteria, assess applications, and assign ratings, among other things, before soliciting applications.
  •  Notify applicants in writing of the outcomes of the application selection process. For unsuccessful applicants, the notification should include a brief explanation of the decision.
  •  Document key decisions throughout the application review and selection process.
DOT responded to the GAO report in a statement from a spokesperson emailed to Bloomberg Government:

“The Department favors the use of sound practices for all discretionary grant programs. As the evaluation process for the INFRA program gets underway, DOT is carefully considering GAO’s recommendations with regard to the evaluation process.”

GAO was only tasked with reviewing the grants in the first year they were awarded. Congressional leaders asked GAO to continue its oversight through the length of the grant program.

“There needs to be more clarity in this process in the future, and we have requested GAO’s continued assessment of the program to help ensure that happens,” the committee leaders said.

To contact the reporter on this story: Shaun Courtney in Washington at scourtney@bna.com

To contact the editor responsible for this story: Paul Hendrie at pHendrie@bna.com

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