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What are the differences between FTA’s definitions of joint development, disposition, incidental use, shared use?

FTA’s policy guidance includes the following definitions.

Disposition

FTA Definition of Disposition: The settlement of the federal interest in project property that is no longer needed for the originally authorized purpose.

Distinction with Joint Development:

  • Disposition allows a grant recipient and the federal government to cash out of property that is no longer needed, so that funds can be applied to other projects. In most cases, disposition involves selling the unneeded property to a third party. After disposition, the property is no longer subject to any federal grant agreements. Joint development may also involve the transfer of an interest in property to a third party. However, unlike disposition, the federal government does not receive its share of the property’s value, so the property remains subject to the federal grant agreement, and any development that occurs on the property must therefore comply with FTA’s joint development policy.
  • Another important distinction between disposition and joint development is the way that the proceeds can be used in relation to the recipient’s transit program. After a disposition, FTA’s share of proceeds must either be reimbursed to FTA, or applied to FTA’s share of another eligible capital project. Because joint development occurs subject to an FTA grant agreement and as part of an FTA-assisted project, the proceeds received by the recipient are considered “program income” and can be applied to transit capital or operating expenses in the transit program.

Incidental Use

FTA Definition of Incidental Use: The limited authorized non-transit use of project property. Such use must not conflict with the approved purposes of the project and must not interfere with the intended transit uses of the project property. An acceptable incidental use does not affect a property's transit capacity or use. FTA may concur in incidental use after award of the grant.

Distinction with Joint Development:

  • The primary distinction between incidental use and joint development is that joint development is a “capital project” (see “Capital Project” at U.S.C. §5302(3)). On the other hand, incidental use is a limited “use” of property.
  • FTA approval of incidental use can only be requested after award of a grant, whereas approval of joint development can be requested at the time of award of a grant or after the grant is awarded.
  • Like joint development, incidental use can generate revenue for transit, which is considered program income.

Shared Use

FTA Definition of Shared Use: Instances in which a project partner, separate from the recipient, occupies part of a facility and pays for its pro rata share of the construction, maintenance, and operation costs. Shared uses must be declared at the time of grant award.

Distinction with Joint Development:

  • Again, shared use is a “use” whereas joint development is a “capital project,” including the coordinated development and improvement of transit and non-transit assets.
  • Also, shared use must be requested and approved at the time of award of a grant, whereas FTA approval of joint development can be requested at the time of award of a grant or after the grant was awarded.
  • Like joint development, shared use can decrease the construction, maintenance, and operation costs of transit facilities by sharing them among multiple users, but shared use typically does not result in revenue for transit. It’s an arrangement that leads to more efficient asset utilization rather than ongoing revenue streams.
Updated: Wednesday, October 4, 2017
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