B-204182.OM, FEB 16, 1982

B-204182.OM: Feb 16, 1982

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YOU ADVISED US THAT UMTA GRANT FUNDS WERE USED TO FINANCE THE CONSTRUCTION OF A MASS TRANSPORTATION PROJECT BY THE MASSACHUSETTS BAY TRANSPORTATION AUTHORITY (MBTA). YOUR AUDIT REVEALED THAT 2.25 MILES OF THIS EXPRESS TRACK IS NOT BEING USED FOR THE PURPOSE THE GRANTEE EXPRESSED IN ITS GRANT APPLICATION - CARRYING COMMUTERS TO AND FROM THE URBAN CENTER. SINCE THIS PORTION OF THE TRACK WAS NOT BEING USED FOR MASS TRANSPORTATION SERVICE. WE CONCLUDE THAT WHETHER THE TRACK SEGMENT IS BEING USED FOR MASS TRANSPORTATION SERVICE IS A MATTER WITHIN UMTA'S DISCRETION AND THIS DISCRETION HAS NOT BEEN ABUSED WHERE THE INTERPRETATION GIVEN SECTION 4 OF THE GRANT AGREEMENT IS NOT INCONSISTENT WITH THE URBAN MASS TRANSPORTATION ACT OF 1964.

B-204182.OM, FEB 16, 1982

SUBJECT: URBAN MASS TRANSPORTATION ADMINISTRATION (UMTA) CONTRACT NO. DOT-UT 148; (CODE 345557; B-204182)

SENIOR GROUP DIRECTOR, CED - STEPHEN KELETI:

SOME TIME AGO, YOU ADVISED US THAT UMTA GRANT FUNDS WERE USED TO FINANCE THE CONSTRUCTION OF A MASS TRANSPORTATION PROJECT BY THE MASSACHUSETTS BAY TRANSPORTATION AUTHORITY (MBTA). ACCORDING TO THE GRANT APPLICATION, THIS PROJECT, KNOWN AS THE HAYMARKET-NORTH RAPID TRANSIT LINE, INCLUDED CONSTRUCTION OF A 4.7 MILE EXPRESS TRACK. YOUR AUDIT REVEALED THAT 2.25 MILES OF THIS EXPRESS TRACK IS NOT BEING USED FOR THE PURPOSE THE GRANTEE EXPRESSED IN ITS GRANT APPLICATION - CARRYING COMMUTERS TO AND FROM THE URBAN CENTER. SINCE THIS PORTION OF THE TRACK WAS NOT BEING USED FOR MASS TRANSPORTATION SERVICE, YOU ASKED IF UMTA SHOULD RECOVER THE FAIR MARKET VALUE OF THIS SEGMENT OF TRACK FROM MBTA, AND IF SECTION 4 OF THE GRANT AGREEMENT AUTHORIZED SUCH A RECOVERY.

WE CONCLUDE THAT WHETHER THE TRACK SEGMENT IS BEING USED FOR MASS TRANSPORTATION SERVICE IS A MATTER WITHIN UMTA'S DISCRETION AND THIS DISCRETION HAS NOT BEEN ABUSED WHERE THE INTERPRETATION GIVEN SECTION 4 OF THE GRANT AGREEMENT IS NOT INCONSISTENT WITH THE URBAN MASS TRANSPORTATION ACT OF 1964, AS AMENDED, AND IN FACT IS REASONABLE. ACCORDINGLY, AS WE PREVIOUSLY ADVISED MR. NICK DEMINICO OF THE BOSTON REGIONAL OFFICE, WE DEFER TO UMTA'S ADMINISTRATIVE DETERMINATION THAT THE GRANTEE HAS COMPLIED WITH THE TERMS OF THE GRANT CONTRACT.

ATTACHMENT

URBAN MASS TRANSPORTATION ADMINISTRATION (UMTA)

DIGEST:

WHERE URBAN MASS TRANSPORTATION ADMINISTRATION AWARDS CAPITAL GRANT TO CONSTRUCT RAPID TRANSIT LINE FOR PURPOSE OF PROVIDING COMMUTER SERVICE TO AND FROM URBAN CENTER BUT AFTER CONSTRUCTION PORTION OF LINE IS USED INSTEAD TO TEST MASS TRANSPORTATION EQUIPMENT AND FOR EMERGENCY OPERATIONS, THERE IS NO VIOLATION OF GRANT AGREEMENT PROVISION THAT WHERE PROJECT EQUIPMENT IS USED FOR PURPOSES OTHER THAN PROVIDING MASS TRANSPORTATION SERVICE, THEN PROPORTIONAL AMOUNT OF ITEM'S FAIR MARKET VALUE SHALL BE PAID GOVERNMENT SINCE AGENCY DETERMINATION THAT PRESENT USE OF TRACK FALLS WITHIN MEANING OF TERM MASS TRANSPORTATION SERVICE IS REASONABLE AND NOT INCONSISTENT WITH THE URBAN MASS TRANSPORTATION ACT.

BACKGROUND:

IN SEPTEMBER 1968, AFTER RECEIPT OF A CAPITAL GRANT APPLICATION FROM THE MASSACHUSETTS BAY TRANSIT AUTHORITY (MBTA), THE URBAN MASS TRANSPORTATION ADMINISTRATION (UMTA) AWARDED A GRANT, AUTHORIZED BY THE URBAN MASS TRANSPORTATION ACT, 49 U.S.C.A. SEC. 1601 ET SEQ., FOR THE CONSTRUCTION AND EQUIPPING OF THE HAYMARKET-NORTH RAPID TRANSIT LINE. THIS PROJECT INCLUDED A NEW 4.7 MILE THREE TRACK SYSTEM. MR. NICK DEMINICO OF THE BOSTON REGIONAL OFFICE, IN A TELEPHONE CONVERSATION WITH MR. G. BURTON OF OUR STAFF, SAID THAT MBTA'S GRANT APPLICATION INDICATES THE ENTIRE THREE- TRACK SYSTEM WAS BUILT FOR THE PURPOSE OF TRANSPORTING PASSENGER-CARRYING COMMUTER CARS TO AND FROM THE URBAN CENTER. HOWEVER, YOUR REVIEW OF THIS GRANT INDICATES THAT ONLY 2-1/2 MILES OF THE TRACKS ARE CURRENTLY USED FOR THIS PURPOSE.

IN RESPONSE TO YOUR CORRESPONDENCE CONCERNING THIS MATTER, UMTA STATED THAT THE 4.7 MILE THREE TRACK CONFIGURATION MBTA CONSTRUCTED MEETS THE TRACK CONFIGURATION THAT MBTA DESCRIBED IN ITS GRANT APPLICATION AND UMTA APPROVED. UMTA ACKNOWLEDGES, HOWEVER, THAT 2.25 MILES OF THE EXPRESS TRACK IS NOT USED CURRENTLY TO CARRY COMMUTERS. IN DETAILING ITS POSITION, UMTA STATES THE TRACK IS USED BY MBTA FOR THE PERFORMANCE/CONFORMANCE TESTING OF ITS NEW COMMUTER CARS WHICH, INCIDENTALLY, WERE PURCHASED WITH GRANT FUNDS. THE PURPOSE OF VEHICLE TESTING IS TO ENSURE THAT THE CARS CONFORM TO DESIGN AND SAFETY SPECIFICATIONS. ADDITIONALLY, MR. DEMINICO ADVISED US THAT MBTA PLANS TO USE THE TRACK TO TEST THE SYSTEM'S AUTOMATIC TRAIN CONTROL EQUIPMENT WHEN IT IS ACQUIRED. THE PURPOSE OF THIS TESTING IS TO ENSURE THE COORDINATED, EFFICIENT AND SAFE OPERATION OF THE MASS TRANSPORTATION SYSTEM. THIS SEGMENT OF TRACK IS ALSO USED TO CONDUCT EMERGENCY OPERATIONS AS WELL AS TO STORE MASS TRANSIT VEHICLES.

BASED ON THE FOREGOING, UMTA MADE AN ADMINISTRATIVE DETERMINATION THAT THE TRACK IS BEING USED FOR "MASS TRANSPORTATION SERVICE" REQUIRED IN SECTION 4 OF THE GRANT CONTRACT. THAT SECTION, ENTITLED, "USE OF PROJECT FACILITIES AND EQUIPMENT," PROVIDES IN PERTINENT PART:

"IF DURING ANY SUCH PERIOD (NOT LONGER THAN TWENTY YEARS) ANY PROJECT FACILITIES OR EQUIPMENT ARE DEVOTED TO USES OTHER THAN THE PROVISION OF MASS TRANSPORTATION SERVICE *** THE FAIR MARKET VALUE THEREOF SHOULD BE PAID TO THE GOVERNMENT."

IN VIEW OF UMTA'S POSITION YOU ASKED US IF USING THE TRACK SEGMENT FOR A PURPOSE OTHER THAN THAT SET OUT IN THE GRANT APPLICATION IS PERMISSIBLE, OR SHOULD UMTA EXERCISE ITS RIGHT TO SEEK RECOVERY OF THE TRACK'S FAIR MARKET VALUE, AS PROVIDED IN THE GRANT CONTRACT? BASED ON THE FACTS PRESENTED, AND AS INFORMALLY AGREED WITH MR. BURTON, THE ISSUE IS WHETHER MBTA'S CURRENT USE OF THE 2.25 MILE TRACK SEGMENT FOR THE TESTING AND STORAGE OF MASS TRANSIT EQUIPMENT CONSTITUTES "MASS TRANSPORTATION SERVICE" AS THAT TERM IS USED IN THE GRANT CONTRACT?

ANALYSIS:

49 U.S.C.A. SEC. 1602(A)(1) AUTHORIZES THE SECRETARY OF TRANSPORTATION TO AWARD GRANTS AND LOANS FOR THE FINANCING OF MASS TRANSPORTATION SYSTEMS. BY REGULATION, 49 C.F.R. SEC. 1.51, THE SECRETARY HAS DELEGATED TO THE ADMINISTRATOR OF UMTA ALL AUTHORITY VESTED IN HIM UNDER 49 U.S.C.A. SEC. 1601 ET SEQ. SIMILARLY, 49 C.F.R. SEC. 145(B) AUTHORIZES THE ADMINISTRATOR OF UMTA TO REDELEGATE AUTHORITY AS HE DEEMS APPROPRIATE. AS A RESULT OF THESE DELEGATIONS, AN AUTHORIZED UMTA OFFICIAL, THE ASSISTANT ADMINISTRATOR, AWARDED MBTA A GRANT FOR THE CONSTRUCTION AND EQUIPPING OF THE HAYMARKET-NORTH RAPID TRANSIT LINE. THE AUTHORITY TO AWARD MBTA THIS GRANT IS FOUND IN 49 U.S.C.A. SEC. 1602(A)(1).

THE SECRETARY OF TRANSPORTATION AND HENCE THE UMTA ADMINISTRATOR OR HIS DELEGATE HAS STATUTORY AUTHORITY TO BRING SUITS TO ENFORCE COMPLIANCE BY RECIPIENTS OF GRANTS UNDER THE ACT. SEE MCDONALD V. STOCKTON METROPOLITAN TRANSIT AUTHORITY, 111 CAL.RPTR. 643 (1974); 49 U.S.C.A. SEC. 1608(A) AND (D); AND 12 U.S.C.A. SEC. 1749AC)(3). FROM THIS ESTABLISHED PRINCIPLE OF LAW, IT FOLLOWS WHERE UMTA AWARDS A GRANT, THE DETERMINATION WHETHER THE GRANTEE IS IN BREACH OF THE GRANT AGREEMENT FALLS WITHIN UMTA'S DISCRETION. THIS FACT IS SIGNIFICANT BECAUSE WE SHOULD GIVE DEFERENCE TO UMTA'S INTERPRETATION OF THE PROVISION IF THE INTERPRETATION IS REASONABLE AND NOT INCONSISTENT WITH THE ACT OR ITS LEGISLATIVE HISTORY.

IN SEEKING TO CONSTRUE THE PHRASE "MASS TRANSPORTATION SERVICE," WE REVIEWED THE ACT AND ITS LEGISLATIVE HISTORY. WHILE SECTION 1608(C)(6) DEFINES "MASS TRANSPORTATION," THIS DEFINITION DOES END OUR QUEST FOR THE PROPER CONSTRUCTION OF THE PHRASE "MASS TRANSPORTATION SERVICE" SINCE USE OF THE WORD "SERVICE" ADDS TO THE PHRASE "MASS TRANSPORTATION." THE PHRASE "MASS TRANSPORTATION SERVICE" APPEARS SEVERAL TIMES IN THE STATUTE, YET IS NOT DEFINED THERE OR IN THE LEGISLATIVE HISTORY. THEREFORE, TO DETERMINE THE MEANING OF THE PHRASE WE MUST CONSTRUE THE LANGUAGE USED.

THE CONTRACTUAL PROVISION PROHIBITS PROJECT FACILITIES AND EQUIPMENT BEING USED FOR PURPOSES OTHER THAN THE PROVISION OF MASS TRANSPORTATION SERVICE. TRANSPORTATION SERVICE HAS BEEN DEFINED TO INCLUDE ALL VEHICLES, FACILITIES AND EQUIPMENT USED IN THE TRANSPORTATION OF PASSENGERS OR IN THE PERFORMANCE OF ANY SERVICE IN CONNECTION THEREWITH. NATIONAL TRAILER CONVOY, INC. V. UNITED STATES, 293 F.SUPP. 630 (1968). IN SOUTHWESTERN BUS CO. V. VILLAGE OF NORTH OLMSTED, 181 N.E. 491 (1932), IT WAS HELD THAT TRANSPORTATION SERVICE INCLUDED EQUIPMENT AND FACILITIES PLUS HUMAN AGENCIES WHICH ARE REASONABLY NECESSARY TO OPERATE THEM. THESE DEFINITIONS HAVE IN COMMON THE PRINCIPLE THAT INCLUDED WITHIN THE MEANING OF THE PHRASE TRANSPORTATION SERVICE IS THE IDEA THAT USE OF THE WORD "SERVICE" INCORPORATES THOSE FUNCTIONS THAT ARE REASONABLY RELATED TO THE PROVISION OF TRANSPORTATION.

WE THINK UMTA'S DETERMINATION THAT IT IS WITHIN THE TERMS OF THE GRANT AGREEMENT FOR MBTA TO USE THE TRACK SEGMENT FOR TESTING MASS TRANSPORTATION EQUIPMENT AND FOR EMERGENCY MASS TRANSPORTATION ACTIVITIES IS REASONABLE ON TWO BASES. FIRST, UMTA COULD HAVE AWARDED MBTA A GRANT FOR THE VERY PURPOSE FOR WHICH MBTA CURRENTLY USES THE TRACK SEGMENT. STATED ANOTHER WAY, MBTA'S CURRENT USE OF THE TRACK SEGMENT IS NOT INCONSISTENT WITH THE ACT'S PROVISIONS (49 U.S.C.A. SEC. 1602) DETAILING THE PURPOSES FOR WHICH MASS TRANSIT GRANT FUNDS MAY BE AWARDED. SECOND, THE TRACK SEGMENT IS BEING USED IN A CAPACITY THAT IS DIRECTLY RELATED TO THE PROVISION OF MASS TRANSPORTATION; I.E., THE TESTING OF MASS TRANSPORTATION EQUIPMENT FOR SAFETY. MOREOVER, WE HAVE BEEN ADVISED THAT THE TRACK IS IN FACT USED FOR COMMUTER TRANSPORTATION IN EMERGENCY CIRCUMSTANCES.

ACCORDINGLY, WE FIND UMTA'S DETERMINATION THAT THE TRACK IS BEING USED FOR MASS TRANSPORTATION SERVICE TO BE REASONABLE AND CONSISTENT WITH THE ACT.