81 FR 96199 - Joint Development: Updated Circular

DEPARTMENT OF TRANSPORTATION
Federal Transit Administration

Federal Register Volume 81, Issue 250 (December 29, 2016)

The Federal Transit Administration (FTA) has issued and placed in the docket and on its Web site updated guidance, in the form of a circular, on joint development projects making use of FTA funds or FTA- funded property. The purpose of the update is to implement recent statutory changes and clarify guidance in FTA Circular 7050.1: FTA Guidance on Joint Development. Because the update reflects existing statute and imposes no new requirements on recipients, FTA is not soliciting public comment.

[Federal Register Volume 81, Number 250 (Thursday, December 29, 2016)]
[Notices]
[Pages 96199-96200]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-31443]


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DEPARTMENT OF TRANSPORTATION

Federal Transit Administration

[Docket No. FTA-2016-0045]


Joint Development: Updated Circular

AGENCY: Federal Transit Administration (FTA), DOT.

ACTION: Notice of update to joint development circular.

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SUMMARY: The Federal Transit Administration (FTA) has issued and placed 
in the docket and on its Web site updated guidance, in the form of a 
circular, on joint development projects making use of FTA funds or FTA-
funded property. The purpose of the update is to implement recent 
statutory changes and clarify guidance in FTA Circular 7050.1: FTA 
Guidance on Joint Development. Because the update reflects existing 
statute and imposes no new requirements on recipients, FTA is not 
soliciting public comment.

DATES: The prohibition on the outfitting of commercial space as part of 
FTA-assisted joint development projects ended when the Fixing America's 
Surface Transportation (FAST) Act (Pub. L. 114-94) took effect on 
October 1, 2015. The policy guidance regarding the ``fair share of 
revenue'' for affordable housing as part of FTA-assisted joint 
development projects will be effective February 13, 2017.

FOR FURTHER INFORMATION CONTACT: For policy guidance questions, Daniel 
Schned, Office of Budget and Policy, Federal Transit Administration, 
1200 New Jersey Ave. SE., Room E52-313, Washington, DC 20590, phone: 
(202) 366-1652, or email, [email protected]. For legal questions, 
Christopher T. Hall, Office of Chief Counsel, same address, Room E56-
311 phone: (202) 366-5218; or email: [email protected].

SUPPLEMENTARY INFORMATION: This notice provides a summary of the 
updates to Circular 7050.1. The Circular itself is not included in this 
notice; instead, an electronic version may be found on FTA's Web site, 
at www.transit.dot.gov, and in the docket, at www.regulations.gov. 
Paper copies of the Circular may be obtained by contacting FTA's 
Administrative Services Help Desk, at (202) 366-4865.

Table of Contents

I. Overview
II. Updates to Circular 7050.1
    A. Outfitting Commercial Space
    B. Affordable Housing

I. Overview

    FTA is publishing updates to Circular 7050.1, regarding joint 
development, that affect: (1) the eligibility of outfitting space for 
commercial use under the FAST Act; and (2) the ``fair share of 
revenue'' for affordable housing as part of FTA-assisted joint 
development projects.

II. Updates to Circular 7050.1

A. Outfitting Commercial Space

    Section 3002(2)(B) of the FAST Act amended Section 5302 of title 
49, United States Code, by striking Section 5302(3)(G)(vi). Section 
5302(3)(G)(vi) had specified that, for the purpose of programs under 
Chapter 53, a capital project for joint development ``does not include 
outfitting of commercial space (other than an intercity bus or rail 
station or terminal) or a part of a public facility not related to 
public transportation.''
    FTA has determined that the best way to comply with Section 
3002(2)(B) of the FAST Act is to strike Section 5, ``Ineligible 
Activities,'' of Chapter III of Circular 7050.1 and all references to 
the section.

B. Affordable Housing

    Section 5302(3)(G)(iii) of title 49, United States Code, requires 
FTA-funded joint development projects to provide a ``fair share of 
revenue that will be used for public transportation.'' Prior to the 
effective date of Circular 7050.1 on October 1, 2014, FTA generally 
deferred to a project sponsor's assessment of what is a ``fair share'' 
of revenue, and did not require any specific amount of transit funding 
from a joint development project. With Circular 7050.1, FTA determined 
that a fair share of revenue means that a joint development project 
must produce revenue for transit at least equal to the Federal 
Government's initial investment in the joint development. (79 FR 
50,728; 50,731-32 August 25, 2014).
    At the same time, FTA recognized that the revenue generated by 
below-market-rate development would be less compared to market-rate 
commercial, residential, or mixed-use development. So as not to impede 
these developments, Circular 7050.1 included an exception for joint 
development projects that are ``community service'' or ``publicly-
operated'' facilities, thereby exempting them from the minimum fair 
share of revenue requirement. FTA also acknowledges that many transit 
agencies have incorporated affordable housing goals into their joint 
development policies. Similar to community service and publicly-
operated facilities, affordable housing also may generate less revenue 
than market-rate development. Accordingly, FTA will allow the fair 
share of revenue provided by joint development projects including 
certain affordable housing to be less than the minimum threshold 
established in Circular 7050.1.
    FTA defines the term ``affordable housing'' to mean legally binding 
affordability restricted housing units available to renters with 
incomes below 60 percent of the area median income or owners with 
incomes below the area median.

[[Page 96200]]

    Given that this update of Circular 7050.1 is a direct 
implementation of a statutory change and imposes no new requirements on 
grantees, FTA is not soliciting public comment.

Carolyn Flowers,
Acting Administrator.
[FR Doc. 2016-31443 Filed 12-28-16; 8:45 am]
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