Transit Asset Management
This section of the Transit Manager’s Toolkit is intended to help new rural transit managers understand the federal requirements for transit asset management. MAP-21 established, and FAST Act reaffirmed, a requirement for U.S. DOT to develop rules and create a national system to monitor and manage public transportation assets to improve safety and increase reliability and performance. In July 2016, the FTA issued its final rule on Transit Asset Management, 49 CFR Part 625, and related changes to National Transit Database, 49 CFR Part 630. These regulations require FTA grantees to collect and use asset inventory and condition data, set state of good repair (SGR) performance targets, develop strategies to prioritize investments, and prepare a plan to meet those targets. The rule went into effect on October 1, 2016. It applies to all FTA recipients and subrecipients who own, operate, or manage public transportation assets used to provide public transportation. This includes subrecipients of Section 5310 and 5311.
This section includes the following subsections:
Transit Asset Management (TAM) is defined in the regulation as “the strategic and systematic approach of procuring, operating, inspecting, maintaining, rehabilitating, and replacing transit capital assets to manage their performance, risks, and costs over their life cycles, for the purpose of providing safe, cost-effective, and reliable public transportation.”
“Capital assets” include vehicles, other equipment, and facilities. “State of good repair” is defined as “the condition in which a capital asset is able to operate at a full level of performance.”
The regulations require the capital assets of each FTA grantee be included in a TAM plan that identifies the overall condition of each category of capital asset and prioritizes financial investments to improve asset conditions. Annual reports must be submitted on the status of each category of capital asset into the National Transit Database (NTD).
In addition to fulfilling a federal requirement, TAM planning can be a helpful tool for rural transit managers in helping them anticipate potential safety concerns (related to vehicles/equipment that can no longer be maintained in a state of good repair), plan for vehicle replacements and facility refurbishments, and plan for the costs and funding to replace and refurbish vehicles and facilities.
The FTA TAM planning requirements categorize Section 5311 subrecipients and American Indian tribes as “Tier II” providers. (“Tier I” providers include rail transit as well as FTA grantees that own, operate, or manages either 101 or more vehicles in revenue service during peak regular service across all fixed route modes or in any one non-fixed route mode.)
State DOTs are responsible for developing a group TAM plan for their Tier II subrecipients. Tier II providers that are subrecipients can opt out of the group plan and develop their own TAM plans if they prefer.
The regulations required the first TAM plans to be submitted to FTA by Oct. 1, 2018. TAM plans must be updated at least every four years, so Section 5311 subrecipients can anticipate that State DOTs will request updated information for the 2022 plan (if not earlier). If an organization did not participate in a state Tier II plan, but instead developed its own TAM plan, the agency will need to prepare to update this plan within four years of the first plan submission (e.g., by Oct. 1, 2022).
FTA requires the following four elements to be included in a Tier II TAM plan:
- Inventory of capital assets that indicates the number and type of capital assets of all capital assets that a provider owns (not just FTA-funded assets), except non-vehicle equipment that cost less than $50,000. If a transit system has exclusive use of vehicles and facilities that are owned by other organizations, these assets generally must also be included.
- Condition assessment of assets in the inventory. This element indicates the extent to which assets are no longer in a state of good repair. It is intended to provide a basis for prioritizing asset replacement or refurbishment.
- A description of analytical processes or decision-support tools used to estimate capital investment needs over time and develop investment prioritization.
- Prioritization of investments needed to maintain assets in a state of good repair.
If a transit agency is participating in the state’s group TAM plan, the State DOT is the best source of information for its TAM planning requirements for Section 5311 subrecipients. If the organization has opted to prepare its own Tier II TAM plan, FTA has developed a TAM Plan Template for Small Providers, as well as a TAMPLATE technical assistance tool.
If a transit agency’s capital assets are included in a group TAM plan prepared by the State DOT, the State DOT will provide instructions on how to assess the condition of the agency’s capital assets, and will compile this information into the group TAM plan.
Generally, for vehicles and equipment, the condition assessment is based on the asset’s age and mileage, and may be supplemented with physical condition data.
Condition assessment of facilities involves a review of facility components, with a focus on safety-critical components, to determine overall condition. FTA’s Transit Economic Requirements Model (TERM) scale of 1 to 5 provides a method for rating the condition of facilities and their components:
5 - Excellent - No visible defects, new or near new condition, may still be under warranty if applicable
4 - Good - Good condition, but no longer new, may have some slightly defective or deteriorated component(s), but is overall functional
3 - Adequate - Moderately deteriorated or defective components; but has not exceeded useful life
2 - Marginal - Defective or deteriorated component(s) in need of replacement; exceeded useful life
1 - Poor - Critically damaged component(s) or in need of immediate repair; well past useful life
More information can be found in FTA’s Facility Condition Assessment Guidebook, which is the source of the TERM scale description.
The TAM requirements include setting performance targets for overall condition of each category of assets. FTA requires that performance targets be set and actual performance be reported to the NTD on an annual basis. There is no penalty for missing a performance target, but submitting the report is a requirement.
For vehicles, “performance” is expressed as the percentage of vehicles that exceed useful life benchmarks, calculated for each type of vehicle (because different types of vehicles are built to have different lifespans in terms of number of years and/or miles operated). Performance targets for the next year would be based on current vehicles in the fleet aging and factor in anticipated new vehicles that would replace those vehicles that are beyond their useful life.
For facilities, “performance” is expressed as the percentage of facilities that are rated less than 3 on the TERM scale—in other words, those which are rated “marginal” or “poor.”
State DOTs, as part of their Tier II group TAM plan responsibilities, report collective performance measures and targets for all agencies that participate in their group TAM plan, and the state is the best source of information for state-specific TAM performance reporting requirements for its Section 5311 subrecipients.
More information on FTA TAM performance management requirements is available on the FTA TAM Performance Management web page.
Updated November 23, 2020