Federal/State Fund Exchange for Transportation Projects

1. Federal/State Fund Exchangefor Transportation Projects A Presentation of Potential Alternatives For Nebraska

3. A Solution?

4. Current LPA Funding With Federal Aid FHWA $1.00 Fed Local Public Authorities Nebraska Department Of Roads $1.00 Fed Current Funding Mechanism

5. The Exchange FHWA Local Public Authorities Nebraska Department Of Roads State Nets +$0.10 Fed $0.90 State $1.00 Fed Existing Exchange Programs Oregon $0.94/$1.00 California (since 1996) $1.00/$1.00 Arizona $0.90/$1.00 South Dakota $0.90/$1.00 Minnesota $0.90/$1.00 Developing Exchange Programs Kansas $0.90/$1.00 90/100 Exchange Funding Mechanism

6. Source: FHWAwww.fhwa.dot.gov/programadmin/pricetrends.cfm Colorado & SD DOT’s

7. To Avoid - Less than 1.5 acres, or about 6’ each side over a mile long project Source: Nebraska Department of Roads LPA Manual

8. Example Present Value Cost Comparisons $1,668,000 Savings to the Taxpayers

9. The Exchange – A Graphic Example NDOR Project LPA Project Total $ 5,000,000 Total $ 5,000,000 Other Funds NDOR $ 5,000,000 FHWA $ 4,000,000 LPA $ 1,000,000 Other LPA Funds Other NDOR Funds LPA Gives the Project’s Federal $$ to NDOR LPA Contributes Add’l $400,000 NDOR Keeps $400,000 for Admin, Etc. NDOR Gives State $$ to LPA Other Funds FHWA $4,000,000 NDOR $ 1,000,000 LPA $ 1,400,000 NDOR $3,600,000 Other LPA Funds -$400,000 Other NDOR Funds +$400,000

10. Pros and Cons

11. Nebraska’s Challenges

12. Nebraska Department of Roads Funding Nebraska Department Of Roads Funding (Millions) 2010 State System Federal $148.513 State $169.000 Other$ 7.472 Total State Program $324.985 Local System Federal $ 60.270 Highway Allocation Fund $188.030 Recreation Road & State-Aid Bridge $ 4.468 Total Local Program $252.768 GRAND TOTAL $577.753 2009 State System State $140.000 Federal $176.623 Other $ 0.000 Total State Program $316.623 Local System Federal $ 49.000 Highway Allocation Fund $196.563 Recreation Road & State-Aid Bridge $ 6.913 Total Local Program $252.476 GRAND TOTAL $569.099 2008 State System State $----------- Federal $----------- Other $----------- Total State Program $340.753 Local System Federal $ 72.379 Highway Allocation Fund $169.324 Recreation Road & State-Aid Bridge $ 6.913 Total Local Program $248.616 GRAND TOTAL $589.369 2007 State System State $----------- Federal $----------- Other $----------- Total State Program $350.000 Local System Federal $ 71.697 Highway Allocation Fund $181.015 Recreation Road & State-Aid Bridge $ 5.836 Total Local Program $258.548 GRAND TOTAL $608.548 Source: NDOR Surface Transportation Improvement Programs

13. $55.149M Source: State of Nebraska Department of Roads – Annual Financial Report 2008-2009

14. Source: State of Nebraska Department of Roads – Annual Financial Report 2008-2009

15. Source: NDOR Surface Transportation Improvement Programs

16. Source: NDOR Surface Transportation Improvement Programs

17. NDOR Cash Flow Source: State of Nebraska Department of Roads – Annual Financial Report 2008-2009

18. NDOR Cash Flow Source: State of Nebraska Department of Roads – Annual Financial Report 2007-2008

19. Current Nebraska State Law 66-4,100. Highway Cash Fund; Roads Operations Cash Fund; created; use; investment. The Highway Cash Fund and the Roads Operations Cash Fund are hereby created. If bonds are issued pursuant to subsection (2) of section 39-2223, the balance of the share of the Highway Trust Fund allocated to the Department of Roads and deposited into the Highway Restoration and Improvement Bond Fund as provided in subsection (6) of section 39-2215 and the balance of the money deposited in the Highway Restoration and Improvement Bond Fund as provided in section 39-2215.01 shall be transferred by the State Treasurer, on or before the last day of each month, to the Highway Cash Fund. If no bonds are issued pursuant to subsection (2) of section 39-2223, the share of the Highway Trust Fund allocated to the Department of Roads shall be transferred by the State Treasurer on or before the last day of each month to the Highway Cash Fund. The Legislature may direct the State Treasurer to transfer funds from the Highway Cash Fund to the Roads Operations Cash Fund. Both funds shall be expended by the department (1) for acquiring real estate, road materials, equipment, and supplies to be used in the construction, reconstruction, improvement, and maintenance of state highways, (2) for the construction, reconstruction, improvement, and maintenance of state highways, including grading, drainage, structures, surfacing, roadside development, landscaping, and other incidentals necessary for proper completion and protection of state highways as the department shall, after investigation, find and determine shall be for the best interests of the highway system of the state, either independent of or in conjunction with federal-aid money for highway purposes, (3) for the share of the department of the cost of maintenance of state aid bridges, (4) for planning studies in conjunction with federal highway funds for the purpose of analyzing traffic problems and financial conditions and problems relating to state, county, township, municipal, federal, and all other roads in the state and for incidental costs in connection with the federal-aid grade crossing program for roads not on state highways, (5) for tests and research by the department or proportionate costs of membership, tests, and research of highway organizations when participated in by the highway departments of other states, (6) for the payment of expenses and costs of the Board of Examiners for County Highway and City Street Superintendents as set forth in section 39-2310, and (7) for support of the public transportation assistance program established under section 13-1209 and the intercity bus system assistance program established under section 13-1213. Any money in the Highway Cash Fund and the Roads Operations Cash Fund not needed for current operations of the department shall, as directed by the Director-State Engineer to the State Treasurer, be invested by the state investment officer pursuant to the Nebraska Capital Expansion Act and the Nebraska State Funds Investment Act, subject to approval by the board of each investment. All income received as a result of such investment shall be placed in the Highway Cash Fund. The Legislature may direct the State Treasurer to transfer funds from the Highway Cash Fund to the Roads Operations Cash Fund. Both funds shall be expended by the department (1) for acquiring real estate, road materials, equipment, and supplies to be used in the construction, reconstruction, improvement, and maintenance of state highways, (2) for the construction, reconstruction, improvement, and maintenance of state highways, including grading, drainage, structures, surfacing, roadside development, landscaping, and other incidentals necessary for proper completion and protection of state highways as the department shall, after investigation, find and determine shall be for the best interests of the highway system of the state, either independent of or in

20. Potential Solutions to Nebraska Exchange Challenges • Modify State Law to Allow Exchanges • Cap Total Annual Exchange Amount • NDOR Pays When Paid • Identify Supplemental Revenue Source to Help Fund Program • Establish Guidelines for Prioritization of Projects

21. Randall J. Kaster, PE, PTOEOlsson Associates2111 S. 67th Street, Suite 200Omaha, NE 68106(402) 341-1116rkaster@oaconsulting.com Thank You!