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FHWA/CaltransStewardship and Oversight

Agreement

Congress has charged Caltrans and FHWA with effectively and efficiently managing the public funds that have been entrusted to them…

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Where did it all begin?

• OIG and GAO concerns with oversight with respect to cost and schedule

• Congress implements changes through the passage of SAFETEA-LU

• FHWA issues new Stewardship and Oversight Agreement Guidance– Current D.O. agreements are inconsistent– On May 8, 2006, FHWA issues new guidance to

implement a more consistent and comprehensive approach to developing stewardship agreements.

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Challenges with the Old Stewardship Agreement

• New SAFETEA-LU requirements have changed oversight responsibilities

• Resources are not strategically focused (currently focused on the Interstate)

• “Full Oversight” is resource intensive• Resources are directed to routine activities

rather than focused on activities that add value• Resources are focused on project oversight

instead of program management

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New Stewardship & Oversight Agreement Development

• Process initiated in August 2006• Done in collaboration with Caltrans• Signed by Will Kempton, Caltrans Director,

and Gene Fong, FHWA Division Administrator, on September 4, 2007

• Agreement became effective November 1, 2007

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What Does Stewardship and Oversight Mean?

• Stewardship – the effective and efficient management of the public funds that have been entrusted to FHWA and Caltrans

• Oversight – the act of ensuring that the Federal-aid highway program is delivered consistent with laws, regulations, and policies

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Comparison of Agreements

• Old Agreement– Full Oversight– State Authorized

• New Agreement– Strategic Oversight– Delegated Projects

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Oversight Thresholds

• Old Agreement– On the Interstate– Greater than $1 million– New or Reconstruction

• New Agreement– Risk Based– Joint Selection

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Actions Delegated or Withheld

• Old Agreement– Actions were fixed– Applied to all federal-aid projects

• New Agreement – Actions are now fluid– Apply to federal-aid projects

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DelegatedResponsibilities

Strategic Project Oversight

Universe of Projects

Full Oversight

High Profile Projects

State Authorized

Delegated Projects

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What is the foundation of the new Stewardship Agreement?

Caltrans & FHWAStrategic Plans

Performance MeasuresCompliance Indicators

Collaborative Multi-Year Plan

Strategic Stewardshipand Oversight

Comprehensive Risk

Based Approach

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Components of New Stewardship Agreement

1. Joint Strategic Planning Process2. Performance Indicators/Measures3. Multi-Year Plan4. Strategic Stewardship and Oversight

– Program Reviews– Program Assessments– Strategic Project Oversight

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Joint Strategic Planning Process

Caltrans & FHWAStrategic Plans

Align desiredobjectives

Align desiredoutcomes

Influence bothStrategic Plans

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Performance Indicators/Measures

• Continuously monitor FAHP elements at a programmatic level (not at a project level)

• Revisited on a systematic basis• Output used in the Program Assessments

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Multi-year Plan

3-year list of strategies

Current list ofHigh Profile Projects

SignificantAccomplishments

Collaborative Multi-Year Plan

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Strategic Stewardship and Oversight

Strategic Stewardshipand Oversight

Strategic Project Oversight

Program Assessment

Program Reviews

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Strategic Stewardship and Oversight

• Program Assessment– Methodology for each program element

• Program Analysis• Assess risk• Prioritize risk events• Identify and implement response strategies

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Strategic Stewardship and Oversight

• Program Reviews– FHWA, Caltrans and other

stakeholders– Often outcome of Program

assessments– Purpose

• Gauge compliance• Identify opportunities and best practices• Recommendations for improvement

– Follow Up

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Strategic Stewardship and Oversight

• Strategic Project Oversight– Step 1:

• Caltrans/FHWA jointly determine High Profile Projects based on criteria

– Step 2:• Within the High Profile Projects, further delegate

low risk activities

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Strategic Project Oversight- Criteria (Step 1)

• High Profile Projects– Controversial and/or Congressional Interest – Demonstration and pilot programs

• (i.e. Value Pricing, Design Sequencing, Buses on Shoulders, Quiet Pavements)

– Executive Order 13274 projects– Interstate Projects

• Projects with Design Exceptions related to the 13 controlling criteria

• Interchanges that are removed, new, or require modification• Innovative Contracting Methods

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Strategic Project Oversight- Criteria (Step 1)

– Invitational (by Caltrans) projects – Major ITS projects– Major Projects (> $500M) – Non-traditional Revenue Sources projects – Special Experimental Projects (SEP 14) –

Alternative Contracting – Special Experimental Projects (SEP 15) –

Public Private Partnerships – Unusual bridge and structure projects

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Strategic Stewardship and Oversight Overview (Step 2)

• Formal agreement written for each High Profile project

• Each project phase will be revisited to determine level of FHWA involvement– Update Agreement

• Agreed upon delegated and non-delegated approval authority will only change when extremely high risks are identified

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High Profile Project Agreement

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High Profile Project Agreement

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High Profile Project Agreement

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Mutual Benefits

• Demonstrated ability to step “out of the box” and lead national efforts

• Ability to leverage resources (time, staff, and budget)

• Strategic use of resources to optimize value added

• Effective utilization of existing measures

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Mutual Benefits continued…

– Partnership approach to Program Management

– Performance based Management– Intelligent Risk Management – Paradigm shift from project oversight

to program management– Show greater accountability for the

entire program

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Questions?

Abraham P. GeevargheseRealty Specialist

FHWA California Division650 Capitol Mall, Ste. 4-100

Sacramento, CA 95814(916) 498-5344

E-mail: abraham.geevarghese@dot.gov