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Highlights

In 1998, the Transportation Equity Act for the 21st Century (TEA-21), authorized the states to retain the federal share of proceeds from the sale or lease of real property that had been purchased with federal-aid funds. It also required the states to use the federal share on other highway projects eligible for funding under the federal-aid highway program. GAO determined (1) the extent to which states are selling, leasing, or disposing of real property purchased with federal-aid funds and (2) how the proceeds generated from the sale or lease of real property are being used, including whether they are being used in accordance with TEA-21. GAO issued a related legal opinion in September 2002.

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Recommendations

Recommendations for Executive Action

Agency Affected Recommendation Status
Department of Transportation 1. To help ensure that states act in accordance with TEA-21 in disposing of real property originally purchased with federal aid, the Secretary of Transportation should direct the Federal Highway Administration (FHWA) Administrator to develop and report on a strategy regarding how FHWA plans to comply with GAO's legal opinion concerning the statute governing the sale or lease of real property.
Closed - Not Implemented
DOT did not concur with the recommendation.
Department of Transportation 2. To help ensure that states act in accordance with TEA-21 in disposing of real property originally purchased with federal aid, the Secretary of Transportation should direct the FHWA Administrator to provide additional guidance to the state DOTs that will help ensure that states use the proceeds of property sales or leases as required by TEA-21, including the types of documentation or tracking that would be cost effective and appropriate to demonstrate compliance.
Closed - Implemented
DOT reported that FHWA provided individual guidance to the State's cited in the report for not properly accounting for Section 156 monies. Follow-up contacts were made to verify that corrective measures were implemented. In addition, multi-state meetings were held where FHWA officials emphasized compliance issues and provided state transportation officials with additional written guidance.

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