1. AASHTO/FHWA Executive Roundtable on Performance-based Planning & Programming Strawman Framework for National Performance-based Program October 22, 2009 Palm Desert, California

2. Overview  National Performance-based Program – Introduction & Basic Concepts  Performance-based Planning Framework  Performance-based Programming Framework  Expert Panel Reaction and Discussion  Open Group Q&A and Discussion

3. To avoid this…

4. Let’s keep in a few points in mind…  Assume a new national performance-based paradigm is a GIVEN under pending authorization  Planning and programming concepts and elements presented today are for discussion – NOTHING is written in stone  These are COMPLICATED, THORNY issues - some quite controversial  Keep questions, comments, suggestions and criticisms CONSTRUCTIVE  This is NOT the end of the line – we’re here to take these ideas & help evolve them into workable proposals for FURTHER CONSIDERATION

5. National Performance-based Program  Introduction and Basic Concepts

6. Defining “Performance-based Planning & Programming” What is “Performance-based Planning and Programming?”  Approach for strengthening accountability by linking plans & investment decisions (programming) to adopted goals & objectives  Tool for helping decision-makers & public gauge extent to which transportation investments move us toward our goals & vision  Method for monitoring & reporting performance of nation’s transportation system in context of established national priorities

7. National Transportation Program Major Elements of “National Program”  Performance-based Approach  Key Performance Objectives  Performance Measures  Performance Goals  Reformed Federal Program Structure

8. Performance-based Approach  AASHTO - Directors endorse program that “increase(s) … federal investment,” is “more focused on national interests,” and is “accountable for results”  House T&I Committee – Authorization will be “accompanied by greater accountability, oversight and performance measures”  Bipartisan Policy Center & Others - Consensus that U.S. transportation policy must be more policy-driven

9. National Transportation Objectives AASHTOFHWABPC SafetyXXX Economic GrowthXXX Mobility/CongestionXXX Environment XXX System Preservation XX System Operations X

10. National Transportation Performance Goals  AASHTO - Directors endorse national goals set by DOTs, MPOs, transit agencies, local governments and USDOT after Authorization  T&I Committee – Authorization bill language calls for USDOT to set goals in selected areas  FHWA Research – Lays out options for goals, from national-only to tailored, state-specific

11. National Transportation Program Structure  AASHTO - Directors endorse six-part, formula- based program aligned with six national objectives  T&I Committee – Four major elements: (1) Critical Asset Investment program; (2) HSIP; (3) Continuation of STP; and (4) CMAQ  BPC Report – Two-part, multimodal program that directs 65% of funds to formula–based system preservation program and 35% of funds to competitive grant-based capacity program

12. Strawman Framework  Planning  Programming

13. Key Definitions National Performance-based Transportation Program (National Performance Program):  A system of national-level goals and measures, along with any changes to the federal program needed to implement a performance-based program

14. Key Definitions Strawman Framework :  The consultant’s proposed starting point for a dialogue about the how state planning and programming processes will need to change in response to creation of a National Performance Program.

15. What is a “Strawman?”  A brainstormed proposal intended to generate discussion of its disadvantages and provoke the generation of new and better idea  A document prepared prior a larger initiative to jump start discussions with a concept that is likely to contain many, but not all the key aspects to be discussed

16. The Big Questions  What parts of the Strawman Framework do you agree with and/or can live with?  What is close (we could get there with refinement)?  What is a non-starter?

17. Strawman Framework: Planning Goal & Measures Alignment Needs Identification Gap Analysis Scenario Development Plan Performance Reporting

18. Strawman Framework: New Planning Elements Goal & Measures Alignment Needs Identification Gap Analysis Scenario Development Plan Finalization Performance Reporting  Key Elements — Align LRTP goals to national goals — Establish State-level performance measures that align with national performance measures — Integrate public input  Potential Changes to Federal Rules — Current requirements stop short of mandating plan linkages to national goals or performance measures — New federal laws, regulations, and/or policies should require linkage state-national goal linkage — Provide guidance to define latitude states have to develop their own goals and performance measures — Define how “reasonable alignment” will be determined

19. Strawman Framework: New Planning Elements Goal & Measures Alignment Needs Identification Gap Analysis Scenario Development Plan Finalization Performance Reporting  Key Elements — Estimate needs to achieve national goals — Ensure needs estimates incorporate “local” priorities and circumstances  Potential Changes to Federal Rules — Existing federal requirements for management systems do not directly extend to needs estimating methodologies; states now develop their needs through any methodology and based on any assumptions they choose — FHWA/FTA may need to consider developing guidelines for how states estimate their needs associated with achieving national goal

20. Strawman Framework: New Planning Elements Goal & Measures Alignment Needs Identification Gap Analysis Scenario Development Plan Finalization Performance Reporting  Key Elements — Forecast revenues — Compare expected revenues to estimated needs — Determine resulting funding gap(s)  Potential Changes to Federal Rules — None anticipated

21. Strawman Framework: New Planning Elements Goal & Measures Alignment Needs Identification Gap Analysis Scenario Development Plan Finalization Performance Reporting  Key Elements — Determine appropriate scenarios -- consider different relative priorities between national goals — Quantify anticipated outcomes — Develop alternative financial scenarios — Iterative scenario development  Potential Changes to Federal Rules — Currently no federal policies related to scenarios — May need to provide guidance on the types of scenarios that should be considered and acceptable approaches for trade-off analysis

22. Strawman Framework: New Planning Elements Goal & Measures Alignment Needs Identification Gap Analysis Scenario Development Plan Finalization Performance Reporting  Key Elements — Select a preferred investment strategy — Develop implementation plan  Potential Changes to Federal Rules — Current rules provide limited guidance on the relationship between final state plans and national investment priorities — FHWA/FTA needs to identify what information plans must provide with respect to states’ anticipated contribution to national goals — Identify if/how their role in approving long range plans may need change

23. Strawman Framework: New Planning Elements Goal & Measures Alignment Needs Identification Gap Analysis Scenario Development Plan Finalization Performance Reporting  Key Elements — State DOTs should provide regular updates on performance in key national performance goal areas is changing due to plan implementation — Reporting would likely be incorporated with capital programming reporting activities  Potential Changes to Federal Rules — Current federal rules do not require state performance reporting; some DOTs have developed their own performance reporting processes — New federal requirements to create performance reporting may be needed

24. Strawman Framework: New Programming Elements Capital Program Definition:  Implements LRTP  Chance to refine direction  Short-range emphasis (1-5 yrs)  Project level  Constrained budget  Connected to STIP

25. Strawman Framework: New Programming Elements Alignment with Plan Goals Identify Project Needs and Revenues Prioritize Projects Quantify Predicted Performance Impacts Report on National Performance Goals Programming elements borrow from states’ performance-based programming activities:

26. Strawman Framework: New Programming Elements Alignment with Plan Goals Identify Project Needs and Revenues Prioritize Projects Quantify Predicted Performance Impacts Report on National Performance Goals  Key Elements — Align with and expand on LRTP; don’t reinvent! — Create program structure that reflects LRTP objectives? — Establish performance baseline for national goals? — Set practical short-term performance goals, based on national goals? — Decide broad distribution of funds among objectives?  Potential Changes to Federal Rules — Current federal rules silent on above actions? — Changes to STIP development requirements may be an option for engaging federal, state and MPO partners

27. Strawman Framework: New Programming Elements Alignment with Plan Goals Identify Project Needs and Revenues Prioritize Projects Quantify Predicted Performance Impacts Report on National Performance Goals  Key Elements — Unconstrained list of project needs — Chosen based on progress toward national performance goals — Compile via blend of data/systems/public input — Estimate project costs/forecast revenues  Potential Changes to Federal Rules — Current federal rules do not specifically require development of an unconstrained menu of projects — FHWA/FTA may need to consider new requirements for states to develop an unconstrained menu of projects

28. Strawman Framework: New Programming Elements Alignment with Plan Goals Identify Project Needs and Revenues Prioritize Projects Quantify Predicted Performance Impacts Report on National Performance Goals  Key Elements — Select fiscally-constrained shortlist of projects that have greatest impact on desired objectives/performance goals — Use management systems/professional judgement/stakeholders’ input to compile program  Potential Changes to Federal Rules — Current rules do not require project prioritization based on predicted performance impacts — A new requirement to apply performance-based prioritization practices to development of the STIP may be necessary

29. Strawman Framework: New Programming Elements Alignment with Plan Goals Identify Project Needs and Revenues Prioritize Projects Quantify Predicted Performance Impacts Report on National Performance Goals  Key Elements — Provide a quantitative assessment (or “scorecard”) of expected progress toward national performance goals — What is “reasonable progress?”  Potential Changes to Federal Rules — Current rules do not require performance predictions — A new requirement to create a report on performance outcomes of the STIP may be an option

30. Strawman Framework: New Programming Elements Alignment with Plan Goals Identify Project Needs and Revenues Prioritize Projects Quantify Predicted Performance Impacts Report on National Performance Goals  Key Elements — Provide regular updates on how performance in key national performance goal areas is changing as a result of program implementation — Performance should be compared to short-term performance goals — Feedback loop for future capital programs  Potential Changes to Federal Rules — Current rules do not require any reporting of performance associated with national performance goals

31. Strawman Framework: Final Observations  Fork in the road?  LRTP/CP approach consolidates performance-based planning in well- established practices DOTs understand  Don’t let others dictate solutions  Starting point for discussion

32. Expert Panel Discussion  Reaction & Comments  Participant Q&A