planning activities

Financial Planning

Metropolitan Transportation Plan

  1. How does the MPO define fiscal constraint?
  • MPO defined fiscal constraint as project expenditures are balanced by revenues (local, state and federal transportation spending); staff used an inflation factor of 2.3 percent for local and state and 1.0 percent for FTA and FHWA revenues; revenues were taken from Wisconsin Department of Revenue for local; TIP for state and federal related projects.
  1. How do the transit operator and WisDOT cooperate with the MPO in developing cost and revenue estimates to support plan implementation?
  • LRTP utilized TIP cost and revenue estimates as part of its financial plan
  1. What data and assumptions are used to identify the level of investment in operations and maintenance? How does the MPO demonstrate that the level of investment in O&M is adequate to maintain the system? 
  • The MPO works with local municipalities to collect and evaluate pavement ratings and monitor system conditions over time including evaluating expenditures from each jurisdiction.

Local Financial Analysis

Local expenditures were gathered for the Appleton (Fox Cities) TMA municipalities from 2008 to 2012 to provide a historic pattern of local transportation expenditures. This analysis looked at the following local transportation expenditures which are defined by the DOR:

  • Highway Maintenance and Administration: includes operating expenditures and capital outlay for engineering, highway equipment and buildings, and highway maintenance. In counties, this entry will include depreciation for equipment and buildings.
  • Highway Construction: includes the operating expenditures and capital outlay for constructing highways.
  • Road Related Facilities: include operating expenditures and capital outlays for limited purpose roads, street lighting, sidewalks, storm sewers, and parking facilities.
  • Other Transportation: includes operating expenditures and capital outlays for airports, mass transit, docks and harbors, and other transportation facilities.

State and Federal Financial Analysis

State (WisDOT) and Federal (FHWA and FTA) expenditures were gathered from ECWRPC’s short range Transportation Improvement Program (TIP) for the five year period from 2010-2014 using the year of expenditure dollar amounts. WisDOT expenditures included both preservation and expansion project dollars. Federal funding expenditures included the following sources:

  • National Highway System
  • Bridge Replacement/Rehab
  • Surface Transportation Program Fond du Lac Urbanized Area
  • Surface Transportation Program State Flexibility
  • Surface Transportation Program (Highway Safety Improvement Program)
  • Surface Transportation Program Enhancements
  • Section 5307 Operating funds
  • Section 5307 Capital funds

Both local and state/federal funds mentioned above were averaged over 5-year periods and the inflation factors applied to the averages to account for a level of variability in transportation projects.

  1. How are improvement costs and schedules estimated?
  • They are submitted by WisDOT and the local jurisdictions based on CIPs and TIP. 
  1. How are schedule and cost for major projects estimated and documented in the Plan?
  • utilize schedule of projects from the TIP for Fox Cities TMA
  1. How are costs adjusted to year of expenditure? Explain the data, assumptions and procedures used to project federal, state and local funding sources through the Plan horizon year?
  • Use inflation factor of 2.3 for local and state and 1.0 for federal project costs

Local Expenditures/Revenues

The estimated long range financial need for local TMA expenditures was calculated using the following steps:

  1. Gathered local expenditures for Highway Maintenance and Administration, Highway Construction, Road Related Facilities and Other Construction for the local municipalities (2008-2012) provided by the DOR. Please reference Table 18-1.
  2. To account for a degree of variation in local transportation spending projects in a given year by municipalities, a 5-year average value of total local expenditures was calculated. These 5-year average values were used to derive the total average amount of local transportation expenditures.
  3. To account for projected revenues needed over the life of this plan, it was assumed that local transportation expenditures must at a minimum be the amount of revenue needed to be fiscally constrained (i.e. expenditures should equal revenues). The calculated 5-year average of expenditures was used to estimate expenses for the life of the plan. An inflation factor of 2.3 percent (provided by WisDOT) was applied to the 2008-2012 annual average expenses for each municipality and compounded for each year out to 2050. This data was then grouped by 5 year increments as shown in Table 18-2.

WisDOT Expenditures/Revenues

The estimated long range financial need for WisDOT TMA expenditures was calculated using the following steps:

  1. Gathered preservation and expansion project expenditures from the TMA’s TIP (2010-2014-year of expenditure dollars) provided by ECWRPC. Please reference Table 18-3.
  2. To account for a degree of variation in local transportation spending projects in a given year by WisDOT, a 5-year average value of total local expenditures was calculated. These 5-year average values were used to derive the total average amount of WisDOT MPO transportation expenditures. To account for projected revenues needed over the life of this plan, it was assumed that WisDOT transportation expenditures must at a minimum be the amount of revenue needed to be fiscally constrained (i.e. expenditures should equal revenues). The calculated 5-year average of expenditures was used to estimate expenses for the life of the plan. An inflation factor of 2.3 percent (provided by WisDOT) was applied to the 2010-2014 annual average expenses and compounded for each year out to 2050. This data was then grouped by 5 year increments as shown in Table 18-5. 

Federal Highway Administration (FHWA) and Federal Transit Administration (FTA) Expenditures/Revenues

The estimated long range financial need for FHWA and FTA TMA expenditures was calculated using the following steps:

  1. Gathered federal expenditures from the TMA’s TIP (2010-2014) provided by ECWRPC. Please reference Table 18-4.
  2. To account for a degree of variation in local federal transportation spending projects in a given year by FHWA and FTA, a 5-year average value of total local expenditures was calculated. These 5-year average values were used to derive the total average amount of FHWA and FTA MPO transportation expenditures.

To account for projected revenues needed over the life of this plan, it was assumed that FHWA and FTA transportation expenditures must at a minimum be the amount of revenue needed to be fiscally constrained (i.e. expenditures should equal revenues). The calculated 5-year average of expenditures was used to estimate expenses for the life of the plan. An inflation factor of 1.0 percent (provided by WisDOT) was applied to the 2010-2014 annual average expenses and compounded for each year out to 2050. This data was then grouped by 5 year increments as shown in Table 18-5.

  1. How are any funding shortfalls addressed?
  • Need to review on yearly basis and at each 5-year update of the LRTP; coordinate with staff on TIP projects and implementation as well.

TIP

  1. What is the MPO’s process for ensuring the TIP is financially constrained by year?
  • The MPO determines that fiscal constraint means the costs of projects that are listed in a plan or TIP for transportation improvements will be available at the time of implementation and can be expected to be available in the future. Staff prepares the Summary of Federal Funding table that provides the total of federal funding by program and year, and the anticipated availability of funds should match. See Table 2 in TIP

7.1        What are the methods and sources of cost estimates?

  • Valley Transit provides staff with listings of revenue sources, revenue amounts and expenditures for the transit system. Staff develops long term estimates and applies an inflation factor to best reflect possible future outcomes.
  • WisDOT provides estimated costs for state and federal projects that are programmed and planned. Staff collaborates quarterly with WisDOT to monitor projects as they change. Staff develops long term estimates and applies an inflation factor to best reflect possible future outcomes.

7.2        How is the total project cost accounted for in the TIP?

  • The TIP project tables list federal, state, local and the type of funding sources.

7.3        How is the year of expenditure inflation rate developed and applied?

  • WisDOT develops an inflation factor and provides that to MPO’s to be applied to all projects listed in Table 2 of the TIP. This year a 2.3 percent rate per year has been used. Transit staff works with its partners to determine the inflation factor on the 5-year estimates of capital and operating needs.

7.4        Do local jurisdictions submit projects in current year dollars or year-of- expenditure?

  • Local jurisdictions submit projects in their best estimate of year-of expenditure dollars. Should the project receive funding it is reviewed and will be refined by the local program manager at WisDOT Northeast Region.

7.5        How does the MPO develop its revenue assumptions?  Do the State and the transit operators provide the MPO with estimates of Federal and State funds available for the metropolitan area?

  • Revenue assumptions are based on local program allocations from WisDOT. Staff relies on Valley Transit to provide the estimates for capital and operating needs that are included in the MTP and TIP. The first 4 years of the TIP must be fiscally constrained by year and include projects for which current or reasonably available funding has been committed.
  1. How are projects that lack a commitment of funds handled in the TIP?
  • Local projects that are on the functionally classified system are solicited yearly for the chance at funding. Also, WisDOT projects out of the 4-year program are classified as illustrative. These are listed in the Candidate Project Listing Table A-1 in the TIP. Any project that does not have a TIP # assigned is classified as illustrative.

8.8        How does the MPO use the illustrative provisions allowed in federal regulations?

  • Any project not funded must be labeled illustrative, see prior response.

8.9        How does the MPO act on these projects when funding is committed?

  • Formal amendment action is required to move a project from the illustrative list to the active 4-year period of the TIP when additional revenues become available to support the project within the demonstration of fiscal constraint.

8.10    How does the MPO prevent these projects from advancing before MPO action is completed?

  • Staff completes the MPO TIP amendment process and then forwards amendment documentation to FHWA, FTA and WisDOT. The project cannot advance until MPO staff assigns TIP #’s to the projects, this is included in the TIP amendment documentation forwarded to the agencies.
  1. How does the TIP financial plan develop and document system-level estimates of costs and revenue sources that are reasonably expected to be available to adequately operate and maintain Federal-aid highways and public transportation annually?
  • Staff prepares files that detail federal funded programs and the costs by year. Any amendment of any kind will change the #’s and the financial plan is updated by staff. 

Please be prepared to discuss the following at the meeting. A written response is not required. 

  1. How is the financial plan updated when the Plan is amended?
  2. During interim updates of the Transportation Plan how is the financial plan reviewed and updated?