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Changes adopted by the CTB to the SMART SCALE program outlined and explained

Earlier this year, the Virginia Secretary of Transportation directed the Office of Intermodal Planning and Investment (OIPI) to conduct a full review of the SMART SCALE process in collaboration with the Virginia Department of Transportation (VDOT) and the Department of Rail and Public Transportation (DRPT). VACo was invited and has participated on the Technical Advisory Committee as part of the program review, which began in April. As previously reported, all proposed changes to SMART SCALE became available in October with a public comment period following. At the December 4 meeting of the Commonwealth Transportation Board (CTB), the Board moved to adopt various staff-proposed changes as well as amend some of the proposed changes to the SMART SCALE program.  This article will outline what changes were adopted by the CTB to the SMART SCALE program.  These adopted changes will be in effect starting next year when SMART SCALE round 6 applications open in the spring.

Small Project Preference
To address concerns that the High Priority Program (HPP) is being used to implement small projects (< $10 million) that do not have meaningful impacts on the improvement of Corridors of Statewide Significance or Regional Networks, the CTB will be changing the process for how HPP funding is allocated as well as redefining what projects are eligible for HPP funding.

The current (Round 5) funding steps are as follows:

  • Step 1 allocates each VDOT construction district’s grant program funding on a district-wide basis.
  • Step 2 allocates HPP funding on a district-wide basis.
  • Step 3 allocates HPP funding on a statewide basis.

The CTB voted to approve a change that will eliminate the current Step 2, so that the funding steps would move straight from Step 1 to Step 3 shown above.  The new process would distribute all HPP program funds based on statewide rankings of SMART SCALE scores.

Current projects that are eligible for HPP funding include those that address needs on a Corridor of Statewide Significance or a Regional Network. With the adopted changes, starting in Round 6, project types eligible for HPP funds would be limited to:

  • New Capacity Highway improvements including adding New Lanes, Roadway on New Alignment, Managed Lanes (HOV/HOT/Shoulder and New Bridge)
  • New or Improved Interchanges, including New Interchange-Non-Limited Access Facility, Improve Grade-Separated Interchange, New Interchange-Limited Access Facility and Ramp Improvements
  • Transit and Freight improvements including New or Improved Passenger Rail Stations or Corridor Improvements (including New Bridge), Freight Rail Improvements, High-Capacity / Fixed Guideway Transit (including Light Rail Transit or Bus Rapid Transit) and Transit Transfer Stations
  • Improvements recommended as the preferred alternative in a STARS, Pipeline Study, Arterial Management Plan, or MPO/Transit/Local studies with equivalent study components; in coordination with the Commonwealth and defined as Regionally significant.

Application Quality and Project Readiness
One of the proposed changes to SMART SCALE was reducing the application caps for all entities; this change responds to a concern regarding application quality. The application cap proposal took multiple forms over the months but was ultimately not approved by the Commonwealth Transportation Board.  For Round 6, the current application caps in place for entities across the Commonwealth will stay in effect.

At the meeting, the CTB signaled they will be moving forward with new administrative processes to address project readiness.  To address project cost overruns and scheduling delays for locally administered projects that have received funding through SMART SCALE, the CTB will be developing an approach that ties project funding decisions to how well the applying entity performs in project delivery.  To address project readiness, the CTB is developing an approach to streamline document approval before final submission. This entails making sure an applicant has approval for high level documents (cost estimates, reports, project schedules, resolutions, other required attachments) before a project is submitted. Lastly, VDOT plans to provide earlier and more targeted support to applicants to assist with applications.  VACo will continue to provide updates as more information becomes available.

Forward-Looking Process
To better align with project design requirements that are based on future growth volumes and consider future economic growth, the CTB approved using 7-year future growth to determine congestion benefit scores instead of current congestion conditions. This is similar to how the congestion factor was calculated in SMART SCALE Rounds 1 & 2 but was modified in Round 3 to prioritize existing conditions.  The initial recommendation was to calculate congestion for 10 years into the future but the CTB during December 4th meeting amended that to 7 years.

The economic development factor measures how each project supports economic development and improves the movement of goods. There are concerns that, as currently constructed, this factor does not account for future economic development. During the SMART SCALE Review, VDOT engaged the Virginia Economic Development Partnership (VEDP) to develop a more forward-looking methodology.  The CTB voted to adopt the staff-recommended changes.  This is a high-level overview of the new Economic Development Measure:

According to staff running the review, the current (Round 5) economic scoring methodology does not incorporate key economic priorities.

  • The methodology needs to better reflect best-in-class economic impact assessments currently used by VEDP.
  • The current process uses manual data entry by applicants and then SMART SCALE staff data validation.
  • Current economic development measures rely on the square footage of sites being developed in the area of influence of the SMART SCALE project.

The adopted changes to the economic development factor seek to include:

  • Focus on sites that will attract growth industries, with the inventory captured in a statewide real estate database.
  • Job creation and capital investments in sites.
  • Estimated potential market demand of sites by including site visits.

The new forward-looking economic development measure reflects best in class economic impact assessments currently used by VEDP to incorporate key economic priorities of the Commonwealth.  A more in-depth understanding and breakdown of the new economic development factor scoring recommendations can be found from pages 5 to 12 in the CTB Presentation from October which is linked here.

Land Use Factor Change
A key concern raised about the current use of the land use score is that it accounts for where a project is located, not expected project outcomes.  There is also concern that the land use score has disproportionately driven the types of projects that are selected for funding. To address these concerns, the CTB considered a change to eliminate land use as a standalone score and instead convert this score to a multiplier that would be used to increase benefit points in other factor areas, thus enhancing the overall project score.  Surprisingly, at the December 4th meeting, the CTB voted to remove land use entirely as a factor to be considered when scoring SMART SCALE applications.  VACo is monitoring how this will affect the applicant community as Round 6 SMART SCALE applications open in the coming months.

With the removal of the land use factor the CTB then reapportioned the points from the land use factor to other scoring factors. The Board-approved weighting for Round 6 can be found in the chart below. (Changes in percentage from Round 5 values are in parentheses)

The SMART SCALE Team has made all of their Review resources, such as presentations to the CTB, Virtual Town Hall recordings and letters regarding the proposed changes from various entities, available to the public which can be accessed here.  OIPI staff provided VACo with a PDF outlining the adopted changes which can be accessed here.

VACo wants to thank The Office of the Secretary of Transportation for including VACo as part of the Technical Advisory Committee during this Review.  VACo wants to further thank OIPI staff for staying in communication with VACo throughout this process and speaking to the Transportation Steering Committee at the  VACo County Officials Summit. Lastly, we want to thank VACo member counties for staying involved throughout this process and providing input to VACo staff.  This December, the Round 6 Draft SMART SCALE Technical Guide will be posted to the homepage of the SMART SCALE website with the final version being posted in January.  Round 6 pre-applications open on March 1, 2024.

VACo Contact: James Hutzler

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