Tribal Transportation Planning Module Series

June 13, 2013

Presented by
Transportation Planning Capacity Building Program
Federal Highway Administration/Federal Transit Administration

Transportation Decisionmaking: Information Tools for Tribal Governments
Module 3: Financial Planning

Jared Fijalkowski: On behalf of the Federal Highway Administration, I would like to welcome everyone to the third of five Tribal Transportation Planning Module Series Webinars. Today's webinar will focus on Financial Planning. My name is Jared Fijalkowski. I'm with the U.S. DOT's Volpe Center, and I will be moderating today's webinar.

Before we begin, I would just like to point out a couple features of our webinar room: On the bottom-left is a chat box that you can use to submit questions to our presenters throughout the webinar. We will answer questions at the end of the presentation, but please enter your questions as they come to you. If you are having any technical difficulties, please use the chat box to send a private chat message to Jared Fijalkowski.

We will make materials available for download at the conclusion of today's webinar. I wanted to mention that we are recording this webinar, so that your colleagues who are unable to join us may listen at a later date.

Before we begin, we have a few poll questions for you to answer. I'm going to bring up that layout now. These will help us better understand our audience today. If you wouldn't mind, there are three questions here: “What is your affiliation?” “How many people are participating at your computer today?” and “Do you currently participate in your Agency's or Tribe's financial planning process?” I will give you a couple of seconds to fill that out. Thanks very much.

We will have two presenters today. The first is Kyle Kitchel of FHWA's Tribal Transportation Program. The second is Ralph Rizzo of FHWA's Resource Center. And now we'll start the webinar. Kyle…

Slide 2 - Presentation Overview

Kyle Kitchel: Thanks, Jared! Welcome to this training series on Transportation Decisionmaking Tools for Tribal Governments. This training series is brought to you by the Federal Highway Administration, and is only informational. Today we will be discussing Financial Planning.

Slide 3 - The Module Training Series

The Financial Planning module will include a discussion on who the audience is for the training and what financial planning is. We will walk through financial planning step-by-step. Then we will summarize what you have learned and point you toward additional resources.

The Tribal Transportation Planning Training Module Series was created by the Federal Highway Administration to help Tribal transportation planners expand their knowledge. The Series was designed to cover multiple aspects of planning, including capital needs, operation of transportation facilities, and ongoing maintenance. These materials are informational and the modules discuss common practices and sample methods for use by Tribal planners. A total of eleven modules are available, including the one we are discussing here. These modules have been developed between 2004 and 2012. To download the modules, visit the web address shown on the screen. FHWA has a variety of other resources for Tribal planners on the FHWA Tribal Transportation program website at

Slide 4 - Training Modules for Tribal Transportation Decisionmaking

The Financial Planning Module is one piece of a training series, depicted on this graph. The modules build upon each other, and are grouped into four areas: Planning, Tribal Intergovernmental Relations, Programming, and Other Elements.

Financial planning uses resources from the Funding Resources module and is closely aligned with two other modules: Developing a Long-Range Transportation Plan and Developing the Transportation Improvement Program.

Slide 5 - Who is the Intended Audience for this Training?

This module is intended for use by Tribal transportation planners, Tribal council members, and finance officers.

I. Introduction

Slide 6 - Who is the Intended Audience for this Training?

Let's begin with an introduction to concepts important to financial planning.

Slide 7 - What is Financial Planning?

Financial planning is a way to estimate how much money the tribe has to pay for needed transportation improvements. Financial planning has three distinct steps: 1) Identification of funding streams; 2) Estimating how much money will be available; and 3) Matching the available funding to needed projects.

Slide 8 - Funding Availability

Transportation funding comes from a variety of sources. A transportation project is often paid for using a blend of funding sources. These sources include Federal, State, local, and innovative financing sources. The Federal government provides hundreds of millions of dollars annually to tribes for transportation. Additional funding is available by partnering with State departments of transportation, metropolitan planning organizations, or local governments. As sovereign entities, tribes are not required to partner with or work together with any of these groups. However, it may be to your advantage if you do so.

Slide 9 - Funding Availability: Federal Sources

Every gallon of gasoline sold in the United States is charged 18.4 cents per gallon, which is deposited into a special account called the Highway Trust Fund. The Highway Trust Fund supports dozens of programs, each of which is focused on supporting a specific type of transportation project. Two programs are specifically reserved for tribes: the Tribal Transportation Program and the Tribal Transit Program.

The most important program for Tribal nations is the Tribal Transportation Program. Federal funding is available to Federally recognized tribes. Tribal Transportation Program funds can be used to make roadway improvements that support travel on or near Tribal lands, maintain roads, fund improvements along the roadway like sidewalks, bike lanes, rest areas, and safety features. The Program has traditionally been administered solely through the Bureau of Indian Affairs. However, rule changes in 2004 allowed tribes to enter into agreements directly with FHWA to access those funds. Every tribe receives a portion of these funds.

The Tribal Transit Program funds public transportation such as bus service on Tribal lands. These funds are obtained by making a competitive grant application to the Federal Transit Administration (FTA).

Slide 10 - Funding Availability: Federal Sources

Tribes are also eligible to receive funding through other Federal programs. In general, your tribe will need to submit an application for funding. I'm not talking about the Tribal Transportation Program, but rather other sources of funding. Your application will compete against proposals from states, MPOs, and local governments.

The Federal Highway Administration has three programs that are intended for use on land that is federally owned or held in trust by the Federal government. Federal Lands Highway administers other programs, such as the Federal Lands Access program, which funds projects that provide access to Federal lands, such as National Parks, Wildlife Refuges, National Forests, and other Federally owned lands. If your Tribal land is adjacent to federally owned land, you may be able to fund all or part of a project through this program.

Beyond Federal Lands Highway programs, there are billions of dollars of Federal grants awarded every year to fund transportation projects. You should contact the FHWA Division office in your State and your FTA Region to learn more about these “discretionary” programs. Tribes are eligible to apply for funding, but competition can be strong. Your tribe should weigh the costs of applying against the likelihood of success. The FHWA and FTA program officers can help you learn more.

The final way to access Federal funding is to enter into a partnership with another government agency such as the State department of transportation, or if applicable, a metropolitan planning or rural transportation planning organization. The largest Federal funds are planned by these agencies. Communicating your tribe's wants with the MPO or DOT may encourage those agencies to select projects that are of interest to you.

Slide 11 - Funding Availability: Local Sources

Local sources of funding are an important way for tribes to raise funds for transportation projects. Of course, Tribal governments can allocate some of their general revenue toward transportation. Tribes can also raise transportation funding by charging certain fees. Examples could be a percentage of retail sales, or a per-gallon tax on gasoline sales. Fees might include vehicle registration, parking permits, or licenses. The tribe may also be able to collect funding through vendors or tenants operating on Tribal lands.

Slide 12 - Funding Availability: Innovative Sources

Tribes can also investigate innovative ways to finance transportation infrastructure. Innovative Finance is a term that means using private money to pay for transportation infrastructure. Private-sector money is supplied through bonds, which are a financial instrument where an investor loans money in exchange for later repayment with interest. Bonds are repaid using future transportation revenue—such as from Tribal Transportation Program—or by charging tolls to use the road.

There are several programs set up by the Federal government to assist and regulate the flow of private money into the transportation system. In each program, private sector investors loan money and the Federal government either assists with the process or guarantees that the loan will be repaid. Note that while the Federal government has involvement here, it is not the lender.

To date, there have been few examples of tribes using innovative financing. However, tribes are eligible to participate in all Federal programs. The most common Federal programs are:

II. What is Financial Planning and How Does It Work?

So that was the introduction part and now we're going to get into what financial planning is and how does it work. And with that, I'm going to hand it over to Ralph Rizzo.

Slide 14 - When to Perform Financial Planning

Ralph Rizzo: Thanks, Kyle! What we're going to do in this part is discuss when you do financial planning and the steps involved in actually doing it. Financial planning should occur at a specific point in the planning process. It should take place after you have established a list of transportation needs and created a project priority list. Once financial planning is complete, the funded projects form the cost feasible project list. This list consists of projects that the tribe intends to build over the life of the long-range plan and that are able to be implemented with anticipated funding through the final year of the long-range plan. All of your work should be compiled into a Tribal Transportation Plan.

Slide 15 - Steps in Financial Planning

There are four steps in the financial planning process which we will discuss each in greater detail here.

Slide 16 - Step 1: Identify Funding Streams and Learn about Programs

As a first step, you will have to gather information on which funding streams are available to the tribe. It is important to remember that the Tribal Transportation Program is the only source of funding that every tribe receives. To investigate other sources, you can:

Slide 17 - Step 1: Identify Funding Streams and Learn about Programs

To further investigate funding sources, you can:

The basic thing to know before entering into a finance arrangement is where the funding for repayment will come from. That's your first question. The objective of learning about programs and identifying funding streams is to have a sense of available funds. Determining the dollar amount will come in subsequent steps.

Slide 18 - Step 1: Find Financial Information

This table lists a number of funding streams that may be available to the tribe as well as the agency charged with making decisions about allocating those funds. Additionally, it lists the agency or individual who should be contacted when making revenue estimates for each funding stream. This can be used as a resource when identifying funding streams. In other words, you make a list of different funding programs and you find out who you need to talk to find out about them and who you need to talk to find out how much funding is available in each of those funding programs.

Slide 19 - Step 1A: Identify Funding Streams

Next you can use that information to start filling out a Funding Inventory Worksheet. It is a useful tool for tracking all of the information you will collect about funding sources, eligible projects, and dollar amounts. The worksheet, which can be created in Microsoft Word or Excel, will have five columns: Funding Stream, Program Officer, Eligible Project Types, Year 1 Revenue, and 20-year Total. As we proceed through this module, you will learn how to fill out and utilize the funding inventory worksheet. We will fill out the columns as we obtain information throughout step 1, parts A-C. To begin, use the information gathered about the funding sources and fill in the first two columns: Funding Stream and Program Officer. Remember we did that in the list in the previous step.

Slide 20 - Step 1B: Fill in Funding Eligibility

Next it is important to understand the types of projects each funding stream can be used for so that funding can be matched to projects later in the financial planning process. However, funding eligibility can vary substantially. The program officer, as noted on the slide, is a good resource to ask for more information about funding eligibility. Common types of eligible projects include roadways, bridges, maintenance, safety, transit, paratransit, and bicycle/pedestrian facilities.

Slide 21 - Step 1C: Obtain Financial Information

Next, you'll determine how much money each stream will produce. Finding out the information about the amount of money that will be available from each funding stream for the first year requires you to consult with the program officer. Program officers may be able to provide advice on how much funding will be available in future fiscal years as well.

Once you have completed step 1C, you should be able to fill out the first four columns of your Funding Inventory Worksheet.

Slide 22 - Step 2: Estimate Future Revenue

From step one, let's move on to the second step: estimate future revenue. During this step, you will use the information you collected in step one, which should be inserted into the Funding Inventory Worksheet, and predict how much money will be available to your tribe over at least the next twenty years. In order to estimate projected funding, you will have to make educated guesses about the consistency of the funding. This involves looking at the general state of the economy; observing funding levels in Federal law; listening to the advice of Tribal contacts at FHWA; and looking to neighboring State and local governments.

Making educated projections about the amount of funding that will be available over time is challenging. It is not 100% accurate, but is very helpful. To make educated projections, you can use baseline inventories; estimates of funding consistency; and knowledge about inflation rates.

Slide 23 - Step 2: Estimate Future Revenue

There are essentially four types of funding.

Slide 24 - Funding Inventory Worksheet

Once the 20-year total has been calculated for each funding stream, the fifth column in the Funding Inventory Worksheet can be filled out. Now the worksheet is complete.

Slide 25 - Step 3: Match Funding to Projects

Let's move on to step 3, matching funding to projects. In this step, the information gathered in steps 1 and 2 will be used to match projects to funding. The materials necessary for this step are the Funding Inventory Worksheet that you just filled out and the Prioritized Project List that you came up with as part of your planning process. Once both are in hand, follow the sequence of steps listed above to make decisions about matching funding to projects.

Slide 26 - Step 3: Match Funding to Projects

The Project Matching Worksheet is what you can use to track the projects on your list and match them to available funds. You can see that the first four columns (A-D) will be filled out using the Project Priority List developed during the project prioritization phase of the planning process. The fifth column (E) will be filled in using the Funding Inventory Worksheet compiled in steps 1 and 2. Once the existing information has been filled in, the only empty columns will be F and G.

Slide 27 - Step 3: Match Funding to Projects

Once you have gone through the sequence of how to match funding to projects, you should be able to come to a decision about how each project will be funded. Once this determination is made, fill in column F by adding the amount of money to be applied to the project. Subtract the total value of the funding stream (found in your Funding Inventory Worksheet) from the amount of money shown in column F. The result should be marked down in column G. You will repeat this process for the second highest priority project and then on down the list until you run out of money.

Slide 28 - Write the Financial Plan

And then you move on to step 4, during which you will write a summary of the decisions that have been made in the financial planning process. You have generated two important spreadsheets in this process: the Funding Inventory Worksheet and the Project Matching Worksheet. You should feel free to include these worksheets in your summary. Other areas to touch on in the Financial Plan would include:

Slide 29 - Step 4: Write the Financial Plan

Step 4 is to write the financial plan. As outlined in the previous slide, your Financial Plan should include an unfunded projects list and a discussion of what will be done with the remaining available funds that are not allocated to a specific project. The unfunded projects list places projects in line to receive unexpected funds. This list can be shared with partners at local governments, the State DOT, and the MPO. Additionally, it should be registered and filed with the BIA so that it is in their records. Remaining funds that are not allocated to a project will be used to fund cost overruns or emergency projects.

III. Principles of Successful Consultation

So those are the steps of financial planning and you now have produced a financial plan to include in your long-range transportation plan. So I will hand it back to Kyle and ask him to summarize what we've talked about and wrap it up.

Kyle Kitchel: Thanks, Ralph! Now that we have completed our instruction of the financial planning process (and I believe these tools are downloadable here at the webinar), you have a set of tools and resources available to you to further assist with future financial planning endeavors.

Slide 31 - Financial Checklist

This checklist will help remind you of all the steps and pieces involved in financial planning and remember to do research. Look at the historical documents as well. How have projects historically been funded?

Slide 32 - Checklist Part II

Then go to part two as well the list continues into matching those funds and writing the financial plan.

IV. Resources

Now that we have completed our instructions of the financial planning process you should at least have a set of tools and resources available to further assist with financial planning. We'll also provide a list of reading materials, so feel free to explore these resources for further information on Tribal transportation, available funding streams, and financial planning. Here's a list of those sources along with the web link. With that, I hand it to Jared and open it up to any questions.

Jared Fijalkowski: Thanks, Kyle. I did get one question as a private chat and that was “Are there any Tribal financial planning processes you recommend a tribe review?”

Kyle Kitchel: Historically tribes have just used the Tribal Transportation Funds, the IRR Funds, so it's been a very single source approach. I recently worked with the Salish and Kootenai Tribes. Their Transportation Improvement Program (TIP) that they've developed is very informative. It follows a process that we have here. And if you would like further information on that, you can email me at or reach me by phone at 360-619-7951.

Jared Fijalkowksi: I've got another question and that is “How can I get contact information for Tribal transportation staff at FHWA?”

Kyle Kitchel: That can be reached at the FLH website. Look under contacts. That has all of the contact and service areas.

Jared Fijalkowski: In terms of the Tribal transportation planning program there's another website at that also has some contact information as well, including the Division Office contacts.

I'm going to move over to our evaluation layout. We like feedback on our webinars to improve our future webinars. You'll also see a new materials box that makes available the materials we have available at this time. You can download a certificate for completing this course, you can download the complete module and you can download the presentation you just saw today. If you have any questions about the webinar, feel free to e-mail me. Kyle also gave you his contact information, so feel free to reach out to him. That concludes our webinar and thank for you participating today. Thanks very much and have a great day.