Financial Plan
The Metropolitan Transportation Plan (MTP) must include a Financial Plan (ยง450.322(f)). The Financial Plan demonstrates that there are sufficient funds (from all various sources available) to pay for projects included in the plan. The Financial Plan must include project costs for the year-of-expenditure and include the total cost of the project. This is a key element in showing that the MTP is fiscally constrained, which is a federal requirement. FHWA provided guidance on financial plans (http://www.fhwa.dot.gov/planning/guidfinconstr_qa.htm) in April 2009.
The Financial Plan must demonstrate that the MTP is financially constrained over its life (at least 20 years). A table showing the various project categories, funding sources and amounts available, and amounts planned for projects can be used. An example table framework is shown below.
| Category | Description | Funding Source | 20-year Projected $ Available |
20-year Project Cost |
|---|---|---|---|---|
| 1 | Preventative Maint & Rehab | Federal | $25,000,000 | $25,000,000 |
| 3 | Metropolitan Area | Federal State |
$30,000,000 | $30,000,000 |
| 4 | Statewide Connectivity | Federal State |
$20,000,000 | $20,000,000 |
| 8 | Safety | Federal State |
$6,000,000 | $6,000,000 |
| 9 | Enhancements | Federal State |
$3,000,000 | $3,000,000 |
| 11 | District Discretionary | Federal State |
$10,000,000 | $10,000,000 |
| Maintenance | State | $15,000,000 | $15,000,000 | |
| Transit | Section 5303, 5310, 5311 only | FTA State |
$8,000,000 | $8,000,000 |
This table is shown only as an illustrative example, each MPO may need to add elements to fully describe project categories and available funding sources applicable to its area. The available funding amounts should include reasonable projections for years beyond those for which exact amounts are known. The Financial Plan can only include revenue sources that can reasonably be expected to be available. If new and/or innovative funding sources are included, the MPO must demonstrate strategies that ensure those funding sources will be available. Such resources may include tolls, congestion pricing, private funds, and additional local taxing authorities (such as economic development corporations).
The Financial Plan should include an introduction that indicates compliance with federal and state policies. A description of each of the TxDOT project programming categories will provide the reader with an understanding of each category's purpose and the types of projects typically included. A section that explains how future funding has been projected is necessary to give all reviewers (from state and federal agencies) and readers a clear understanding that a reasonable process was used. This section will also be beneficial to the MPO as funding expectations change through the life of the MTP.
The Financial Plan should also discuss any funding gaps that exist between all desired projects and those for which funding is available. This section may include a brief discussion of how projects were prioritized, or a reference to such a discussion elsewhere in the document.
A section should be included that explains all appropriate FTA funding categories and their purposes. When applicable, this discussion may also include a reference to locally generated funds (such as sales tax) that supplement the FTA funds. Specific example of how the categories relate to the subject MPO help the readers understand applicability to the area.
Additional sections should be included to explain special corridors, economically disadvantage counties program, and any other special funding sources (local, regional, or toll authorities). Any anticipated private/public funding partnerships should also be discussed.
Developing the Financial Plan needs to be a coordinated effort by the MPO, TxDOT, and any transit operators that exist in the metropolitan area. Key inputs from TxDOT and the transit operator(s) include estimations of available federal and state funds.
Additional information regarding financial constraint and financial planning can be found at http://www.fhwa.dot.gov/planning/statewide/fcreport.htm.