Ҥ 171. Consolidated funding pilot program

“(a) In general.—The Secretary shall carry out a consolidated funding pilot program (referred to in this section as the ‘program’) in 3 States, as selected by the Secretary, that are eligible under subsection (c)—

“(1) to transform the Federal-aid highway program to a performance- and outcome-based program that refocuses investment of resources on transportation projects that make progress toward the achievement of the national goals described in paragraphs (1) through (7) of section 150(b); and

“(2) to continue advancements made under the Moving Ahead for Progress in the 21st Century Act (Public Law 112–141; 126 Stat. 405) and the Fixing America's Surface Transportation Act (Public Law 114–94; 129 Stat. 1312) to streamline program categories by demonstrating how additional flexibility would enable States to make investment decisions that better achieve State and national goals while advancing accountability and transparency of the Federal-aid highway program.

“(b) Implementation.—

“(1) IN GENERAL.—In carrying out the program, of those funds apportioned to a participating eligible State and after suballocations, set-asides, and pass-throughs made within each State to entities other than the transportation department of the State (including a metropolitan planning organization and a regional transportation planning organization), the Secretary shall treat the apportionments remaining with the State transportation department under the individual apportionment programs described in section 104 as a single, consolidated apportionment.

“(2) ELIGIBLE ACTIVITIES.—Activities eligible under the program shall include all activities eligible for the individual apportionment programs described in section 104.

“(c) Eligibility.—To be eligible to participate in the program—

“(1) a State selected by the Secretary under subsection (a) shall—

“(A) demonstrate that well-established performance management systems are in place in the State for the national goals for—

“(i) safety described in section 150(b)(1); and

“(ii) infrastructure condition described in section 150(b)(2);

“(B) demonstrate that the performance management systems in place in the State include a system of metrics and performance measures that guide the State in using program funds and prioritizing projects—

“(i) to ensure an effective use of resources; and

“(ii) to further the objectives of the program; and

“(C) demonstrate progress made toward achieving measurable performance of national goals for—

“(i) congestion reduction described in section 150(b)(3);

“(ii) system reliability described in section 150(b)(4);

“(iii) freight movement and economic vitality described in section 150(b)(5);

“(iv) environmental sustainability described in section 150(b)(6); and

“(v) reduced project delivery delays described in section 150(b)(7); and

“(2) the head of the State agency with primary jurisdiction over highways shall enter into a written agreement with the division administrator of the field office of the Federal Highway Administration located in the State and any metropolitan planning organization located in the State, which shall specify which individual apportionment programs or portions of programs referred to in subsection (b) shall be included in the program in that State.

“(d) Term.—The Secretary shall carry out the program for a term of not fewer than 6 years.

“(e) Termination.—Participation of a State in the program may be terminated—

“(1) by the Secretary if—

“(A) the Secretary determines that the State is not adequately carrying out the responsibilities assigned to the State under the program;

“(B) the Secretary provides to the State—

“(i) notification of the determination of noncompliance under subparagraph (A); and

“(ii) a period of not less than 30 days during which the State may take such corrective action as the Secretary determines necessary to comply with the program; and

“(C) after the notification of noncompliance and the expiration of the period under subparagraph (B), the State has not taken satisfactory corrective action, as determined by the Secretary; or

“(2) by the State at any time if—

“(A) not later than 90 days before the date of termination, the State provides to the Secretary notice of the termination; and

“(B) the State complies with such other terms or conditions as the Secretary determines to be necessary.

“(f) Reports.—

“(1) STATE REPORTING REQUIREMENTS.—Participating eligible States shall submit to the Secretary an annual report—

“(A) demonstrating how performance management systems were used to guide the decisionmaking process of the State in the development of the statewide transportation improvement program of the State under section 135; and

“(B) describing the results of the program based on performance measures that demonstrate progress toward the achievement of performance goals.

“(2) REPORT TO CONGRESS.—The Secretary shall submit to Congress an annual report that describes the administration of the program.”.