On December 11, 2013, the Federal Transit Administration (FTA) issued Draft Guidance on a new provision enacted under the Moving Ahead for Progress in the 21^st Century Act (MAP-21) expanding FTA’s ability to assist grant recipients in acquiring right-of-way for future transit use.  Under the new law, codified at 49 U.S.C. § 5323(q), FTA may assist recipients in acquiring right-of-way for future transit purposes before environmental review of the transit project itself is completed, provided that construction does not begin on the acquired property before environmental review of the project is completed.  Prior to enactment of MAP-21, a similar provision allowed FTA to assist in the acquisition of pre-existing railroad right-of-way for the purpose of corridor preservation.  Although the provision is still entitled “Corridor Preservation”, the new statute broadens the scope of allowable acquisitions to include properties acquired to assemble new corridor for future public transit use.

The Draft Guidance provides information in a question and answer format regarding FTA’s approach to implementing 49 U.S.C. § 5323(q).  According to the Draft Guidance, FTA considers eligible right-of-way to constitute property that is generally linear and needed for an FTA grant-eligible project.  The property acquired may include pre-existing right-of-way or non-linear parcels that, when combined with each other or with other property, constitute a right-of-way.  Associated existing facilities such as station platforms and park-and-ride lots may also be considered property eligible for acquisition, as may property needed for the future construction of such facilities so long as the target property is required for a future transit project and is located physically within the right-of-way footprint.  FTA may also allow for early acquisition of non-linear property located outside of a right-of-way footprint based on hardship or protective purposes as described in FTA’s existing categorical exclusion regulations, 23 C.F.R. § 771.118(d)(3).

FTA states that it considers acquisition of right-of-way under 49 U.S.C. § 5323(q) to be a separate action from the future construction of the proposed transit project and, as a result, requires federally-funded acquisition of such right-of-way to comply with FTA’s planning, environmental review, and other grantee requirements.  Once the property is acquired, FTA will require that the recipient separately satisfy FTA requirements, including environmental review, before developing the right-of-way for transit purposes.  The separate acquisition will not be considered impermissible segmentation of a project under NEPA because 49 U.S.C. § 5323(q) expressly permits such segmentation.

Because 49 U.S.C. § 5323(q) permits FTA to assist only those activities that are carried out in anticipation of future transit service needs, the Draft Guidance provides that FTA will not assist in corridor acquisition after the NEPA review process for a project has already been initiated.  However, project sponsors would still be allowed to acquire property through FTA’s categorical exclusion process for property acquisition based on hardship or protective purposes under 23 C.F.R. § 771.118(d)(3), which remains unaffected by the statutory change and the Draft Guidance.  The Draft Guidance also cautions against impermissible development or interim use of acquired property.  Interim use of acquired property that modifies the property, including use as a recreational trail, is subject to its own environmental review, which is to be conducted along with environmental review of the property acquisition if such interim use is reasonably foreseeable prior to acquisition.

Although 49 U.S.C. § 5323(q) broadens the scope of permissible FTA-funded activities to include both preservation of existing right-of-way as well as assembly of new right-of-way for future transit purposes, the Draft Guidance appears to reduce some flexibility available under the law as it existed before MAP-21.  For example, the Draft Guidance limits the timing of property acquisition to occur before initiation of the NEPA process, forcing project sponsors to preserve or assemble right-of-way before they have even initiated detailed review of other project impacts.

Comments on the Draft Guidance are due by January 10, 2014.  Comments may be submitted under FTA Docket Number FTA-2013-0019 through http://www.regulations.gov.