What did the review conclude?

• The review indicates that Federal Highway Funds sanctions would likely not be imposed if HOV lanes are reserved for high occupancy vehicles at least during peak commute times.
• The Federal Highway Administration (FHWA) must agree with any significant change in HOV lane operation. If they don't agree they can impose sanctions on WSDOT's future federal funding.
• Federal Transit Administration fixed guideway modernization funding for transit service could be preserved as long as the corridor served by an HOV lane has a level of service of D or worse, the lanes continue to be restricted to HOVs during some hours of the day, and the hours of operation are adequately enforced.
• Sound Transit must protect its investment in the HOV system. If specific HOV operational change proposals hurt transit speed and reliability, Sound Transit's financial investment in the HOV system may be jeopardized.
• Cost estimates to change high occupancy vehicle (HOV) hours of operation range from $2 million to change fixed signs to $55 million to install dynamic signing. Dynamic signing would allow changes at various locations on an as-needed basis, when there is traffic congestion or during a special event, for example.

Will opening HOV lanes to all traffic require repayment of federal highway funds or threaten future federal highway funding?

Certain federal highway funds used to construct freeway HOV lanes have restrictions that may impose sanctions should the lanes be opened to general-purpose traffic. It is WSDOT's interpretation that, as long as the HOV lanes are maintained at least during peak commute times, a change in operation will not result in sanctions of Federal Highway Funds based on the restrictions of the funding source. FHWA however does have to agree with any significant change or they can impose sanctions on WSDOT's future federal funding.

What requirements or regulations are tied to federal highway money?
Certain federal highway funds used to construct freeway HOV lanes have restrictions that may impose sanctions should the lanes be opened to general-purpose traffic. It is WSDOT's interpretation that, as long as the HOV lanes are maintained at least during peak commute times, a change in operation will not result in sanctions of Federal Highway Funds based on the restrictions of the funding source. FHWA however does have to agree with any significant change or they can impose sanctions on WSDOT's future federal funding.

Federal funding that cannot be used to create unrestricted, non-HOV freeway travel lanes:

• Congestion Mitigation & Air Quality Improvement (CMAQ) program [23 U.S.C. 149(b)] (No Central Puget Sound freeway HOV lanes were constructed using CMAQ funds)
• Interstate Maintenance program [23 U.S.C. 119(d)]
• Mass Transit Capital Investment Grants [49 U.S.C. 5309(a)(1)(B)]

The restriction also applies in some situations when other federal funds are used for highway construction. If higher Federal participation ratios were used to obtain money to build HOV lanes then this federal money cannot be used to create unrestricted freeway travel lanes. This means that while the state invested less money to obtain federal funds, in return the state agreed to create and operate HOV lanes. This restriction applies to some money obtained from:

• National Highway System (NHS) program
• Interstate Maintenance program [23 U.S.C. 119(d)]
• Surface Transportation Program (STP)
• Interstate 4R Discretionary program
• Interstate Construction program (23 C.F.R. 635)
• Interstate Maintenance Discretionary Program
• Interstate the Discretionary program (See Appendix A)

Can the state repay restricted funds to overcome federal limitations?
States cannot repay restricted federal funds that were already spent on a highway project unless specifically authorized by Federal statute. In other words, payback in an effort to overcome funding limitations is not permitted because the Federal Highway Administration lacks general statutory authority to permit payback of funds and reobligation for a new purpose.

What federal highway funds were used to construct our freeway HOV lanes?
Several categories of Federal-aid funding have been used to acquire right-of-way, design or construct HOV lanes. To date, 198 lane-miles of the planned 297 lane-mile Puget Sound Core Freeway HOV system have been constructed. The majority of these lanes were constructed using at least some Federal funding. Federal funding totals nearly $770 million.

Federal dollars by fund source

Fund Source	Total $
	All Phases
Interstate Maintenance	$93,444,488.82
Interstate Discretionary	$97,014,774.94
STP - State Flexibility - Interstate	$10,118,707.70
STP - State Flexibility - Non-interstate	$491,157.14
Interstate Completion	$107,566,563.96
Demonstration Project	$10,462,120.00
NHS - Principal Arterial - Non-interstate	$39,703,340.37
SP - Urban Areas > 200,000 Pop. - Interstate	$353,000.00
NHS - Principal Arterial - Interstate	$4,217,648.61
Bridge Replacement	$896,232.80
STP - Urban Areas > 200,000 Pop. - Non-interstate	$1,800,000.00
Congestion Mitigation & Air Quality - Non-interstate	$3,667,190.00
Interstate Completion w/Fly Ash	$50,455.00
Interstate Completion (I-90)	$400,000,000.00
TOTAL	$769,785,679.34

Several categories of Federal-aid funding have been used to acquire right-of-way, design or construct HOV lanes. To date, 198 lane-miles of the planned 297 lane-mile Puget Sound Core Freeway HOV system have been constructed. The majority of these lanes were constructed using at least some Federal funding. Federal funding totals nearly $770 million.

Is federal approval required to use HOV lanes for general purpose traffic?
Yes. Each significant change in operations on facilities built with federal funds needs to be reviewed by the Federal Highway Administration (FHWA) and the Federal Transit Administration (FTA) to determine if the proposed action complies with their requirements. Sources and amounts of Federal-aid funding used for the design and construction of the HOV lanes must be identified when documentation is developed to significantly change the operation or convert HOV lanes to general-purpose travel lanes. Associated project agreements must also be analyzed to determine if any other provisions have been established that further restrict the operation of the HOV lane. If the proposal doesn't comply with the requirements then the change will not be approved. If an agency implements a change which is determined to be noncompliant then sanctions will be imposed by FHWA, consistent with 23 C.F.R. 1.36. Sanctions can include withholding further federal highway project approvals.

Additional information on the funding limitations related to Federal-aid programs can be found in Titles 23 (Highways) and 49 (Transportation) of U.S.C. and the FHWA publication titled "A Guide to Federal-Aid Programs and Projects." For high priority or demonstration projects the federal legislation authorizing the project must be reviewed to obtain information related to any limitations. A summary of the regulatory requirements related to HOV lanes for the Federal-aid programs that are administered by FHWA is provided as Appendix A.

Will opening HOV lanes to all traffic threaten future federal transit funding?

The Federal Transit Administration (FTA) uses HOV lane miles in a formula for distributing federal transit Fixed Guideway Modernization Funding to regional transit agencies.

Funding is apportioned to urbanized areas based on route miles of qualifying HOV facilities and revenue vehicle miles of service as reported in the National Transit Database (NTD). The NTD reporting document provides criteria for establishing eligibility for both the Fixed Guideway Modernization Program and the Urbanized Area Formula Program. HOV lanes on exclusive or controlled access right-of-way that meet the following criteria are included in the funding allocations:

• Serve travel corridors with unfavorable levels of service (defined as level of service D or worse)
• Have prohibited hours during which single occupant private automobiles are legally prohibited and are enforced from using any segment portion

Therefore any change of HOV lane hours of operation under which these criteria continue to be met would not change eligibility for FTA funding. The FTA reporting document further specifies:

"The bus fixed guideway segments must legally prohibit single occupant private automobiles from using any portion of the segment. If the prohibition is for all hours of the week, then the segment is exclusive right-of-way. If the prohibition is only for some hours of the week, then the segment is controlled access right-of-way."

This clearly demonstrates that FTA allows Fixed Guideway Modernization funding for HOV facilities that are open to generalpurpose traffic during specified periods. This type of operation is found in numerous regions around the country where lanes are restricted to HOV traffic only during peak periods. All transit revenue miles in the facility are credited for funding purposes regardless of whether the service is provided during hours restricted to HOVs.

Transit service provided on the Puget Sound core HOV system would continue to be eligible for FTA fixed guideway modernization funding as long as the:

• corridor served by an HOV lane has a level of service of D or worse
• lanes continue to be restricted to HOVs during some hours of the day
• hours of operation are adequately enforced

Will opening HOV lanes to all traffic threaten Sound Transit investments in the system?
Sound Transit is making a sizable investment to construct HOV direct access ramps. If HOV operations damage transit speed and reliability, Sound Transit's financial investment in the HOV system may be jeopardized. As a result, Sound Transit has a clear policy position designed to protect its investment in the HOV system.

Sound Move, the regional transit plan approved by the voters in November of 1996, notes the importance of the HOV system (pp. 12,13):

"Because the RTA will be making a significant investment in the state high-occupancy vehicle system, it will have an ongoing interest in how that system functions. Before committing funds for HOV projects, the RTA Board must be satisfied that the HOV system will be managed in a way that maintains adequate speed and reliability for transit into the future.

The RTA will negotiate an agreement with the state Transportation Department and the Puget Sound Regional Council similar to the state Transportation Commission's existing Statewide Freeway High-Occupancy Vehicle Policy to specify mutually acceptable speed and reliability standards, and how those standards will be monitored and maintained. In negotiating this agreement the RTA will seek to specify how it will be compensated if those standards are not maintained and the advantages to transit created by its investment are reduced."

The agreement called for in Sound Move has not yet been negotiated, however Sound Transit and WSDOT signed a Memorandum of Understanding in 1997 which states that WSDOT will maintain and operate the facilities consistent with their intended function.

Sound Transit Direct Access Investments (in $000)

Project	Budget	Spent as of 2/28/2002
I-5 at Ash Way	16,979	1,361
I-5 at Lynnwood	31,157	3,711
I-5 at Federal Way (317th)	27,176	2,488
I-5 at Federal Way (272nd)	24,826	2,128
I-405 at Kirkland	92,170	4,847
I-405 at Bellevue	107,903	8,713
I-405 at Renton	86,958	2,160
I-90 at Eastgate	38,908	964
I-90 at Sunset I/C	9,512	9,186
I-90 at SR 900	10,380	17
I-5 at Mountlake Terrace	13,879	172
I-5 at South Everett	26,075	2,095
I-405 at Canyon Park	6,638	52
I-90 at Mercer Island	18,889	2,780
SR 522 HOV Enhancements	14,696
SR 99 Transit Lanes	2,710	1,728

How much would it cost to change HOV lane operations to allow all traffic during certain hours or days?
The cost varies depending upon whether you open HOV lanes to all traffic on a static or dynamic basis. Cost estimates include preliminary engineering, changes to static signs or installation of variable message signs, traffic control while signs are being changed, public information, maintenance, enforcement and evaluation. Estimates do not include money to mitigate safety, operational or environmental impacts. Some options may require significant mitigation investment.

Opening the lanes on a static basis; every weekend or every night, for example; would cost an estimated $2 million plus mitigation investment.

Opening the lanes on a dynamic basis; only when there's no traffic congestion or when there are special events, for example; would cost up to $55 million plus mitigation investment.