INTERSTATE DISCRETIONARY FUNDS.

SEC. 114. INTERSTATE DISCRETIONARY FUNDS. (a) Construction Funds; Additional Priority Project.—Paragraph (2) of section 118(b) of title 23, United States Code, is amended to read as follows: “(2) Interstate construction funds.— “(A) Period of availability.— 101 STAT. 151 “(i) Apportionments before October 1, 1989.—Except as otherwise provided in this subsection, sums apportioned before October 1, 1989, for the Interstate System in any State shall remain available for expenditure in the State until the end of the fiscal year for which authorized. Upon request of the State, the Secretary shall reduce the period of availability of such sums by 1 fiscal year. “(ii) Apportionments thereafter.—Sums apportioned on or after October 1, 1989, for the Interstate System in any State shall remain available for expenditure in the State until expended. “(B) Discretionary projects.—Sums not obligated within the time period prescribed by subparagraph (A)(i) shall lapse and, subject to section 149(d) of the Federal-Aid Highway Act of 1987, be made available by the Secretary for projects on the Interstate System (other than projects for which sums are apportioned under section 104(b)(5)(B)) in accordance with the following priorities: “(i) First, for— “(I) high cost projects which directly contribute to the completion of a segment of the Interstate System which is not open to traffic; and “(II) high cost projects for construction of high occupancy vehicle lanes and other lanes on any highway in Los Angeles County, California, designated as a part of the Interstate System by section 140 of the Federal-Aid Highway Act of 1978 and the costs of construction of which are included in the interstate cost estimate for 1985. “(ii) Second, for projects of high cost in relation to a State’s apportionment. “(iii) Third, for projects with respect to which the Secretary may make payments under section 115 of this title. “(C) Limitation on states eligible for discretionary funds.—Sums may only be made available under this paragraph in any State in a fiscal year if— “(i)(I) the Secretary determines that the State has obligated all of its apportionments under section 104(b)(5)(A) of this title other than an amount which, by itself, is insufficient to pay the Federal share of the cost of a project on the Interstate System which has been submitted by the State to the Secretary for approval; or “(II) the State certifies to the Secretary that the State will obligate before August 1 of the fiscal year all of its apportionments under section 104(b)(5)(A) other than such an insufficient amount; and “(ii) the applicant for a project with respect to which the Secretary may not make payments under section 115 of this title is willing and able to— “(I) apply the funds to a ready-to-commence project, and “(II) in the case of construction work, begin work within 90 days of obligation. “(D) Exception to limitation.—The Secretary may make funds available to the State of California for construction of 101 STAT. 152high occupancy vehicle and other lanes described in subparagraph (B)(i)(II) whether or not such State has met the requirements of clause (i) of subparagraph (C). Nothing in this subparagraph shall be construed to give construction of such lanes priority over projects described in subparagraph (B)(i)(I). “(E) Limitation on secretary’s discretion.—If, within 365 days after any sums become available for obligation under this paragraph, the Secretary does not make such sums available for first priority projects under subparagraph (B)(i) of this paragraph, the Secretary shall make such sums available for carrying out second and third priority projects under subparagraph (B). “(F) Period of availability of discretionary funds.—Sums made available pursuant to this paragraph shall remain available until expended.”. (b) Set Aside of 4R Funds for 4R Discretionary Projects.—Section 118(c) of such title is amended by inserting “Set Asides for Interstate Discretionary Projects.—” after “(c)”, by inserting “(1) Set aside for construction projects.—” before “Before”, and by adding at the end thereof the following new paragraph: “(2) Set aside for 4R projects.—Before any apportionment is made under section 104(b)(5)(B) of this title, the Secretary shall set aside $200,000,000 for obligation by the Secretary in accordance with subsection (b)(3) of this section and subject to section 149(d) of the Federal-Aid Highway Act of 1987.”. (c) Limitations on States and Projects Eligible for 4R Discretionary Funds.—Paragraph (3) of section 118(b) of such title is amended to read as follows: “(3) Interstate 4r funds.— “(A) Period of availability.—Any amount apportioned to a State for the Interstate System under section 104(b)(5)(B) of this title shall continue to be available for expenditure in the State for a period of 1 year after the close of the fiscal year for which such sums are authorized. “(B) Discretionary projects.—Sums not obligated within the time period prescribed by subparagraph (A) shall lapse and, subject to section 149(d) of the Federal-Aid Highway Act of 1987, be made available by the Secretary for projects for resurfacing, restoring, rehabilitating, and reconstructing any route or portion thereof on the Interstate System (other than any highway designated as a part of the Interstate System under section 139 and any toll road on the Interstate System not subject to an agreement under section 119(e) of this title). Such funds shall be made available by the Secretary to any other State applying for such funds, if the Secretary determines that— “(i) the State has obligated all of its apportionments under section 104(b)(5)(B) other than an amount which, by itself, is insufficient to pay the Federal share of the cost of a project for resurfacing, restoring, rehabilitating, and reconstructing the Interstate System which has been submitted by such State to the Secretary for approval; and “(ii) the applicant is willing and able to (I) obligate the funds within 1 year of the date the funds are made available, (II) apply them to a ready-to-commence 101 STAT. 153project, and (III) in the case of construction work, begin work within 90 days of obligation. “(C) Priority consideration for certain projects.—In selecting projects to fund under subparagraph (B), the Secretary shall give priority consideration to any project the cost of which exceeds $10,000,000 on any high volume route in an urban area or a high truck-volume route in a rural area. “(D) Period of availability of discretionary funds.—Sums made available pursuant to this paragraph shall remain available until expended.”. (d) Credit for Certain Unused Right-of-Way.—Notwithstanding any other provision of law, the value of unused right-of-way acquired under section 104(b)(5)(A) of title 23, United States Code, or section 118(b)(2) of such title in the State of Arizona may be credited to the unobligated balance of funds apportioned to the State under section 104(b)(5)(B) of such title if requested by the State and approved by the Secretary. (e) Conforming Amendments.—(1) The matter preceding the first colon in section 104(b) of title 23, United States Code, is amended by inserting after “subsection (a) of this section” the following: “and the set asides authorized by subsection (f) of this section and sections 118(c) and 307(d) of this title”. (2) Section 118 of such title is amended by striking out the heading for such section and inserting in lieu thereof the following: “§ 118. Availability of funds”. (3) Section 118(b) of such title is amended— (A) in paragraph (1) by inserting “Periods of Availability of Funds; Discretionary Projects.—” before “(1)”; (B) in paragraph (1) by inserting “Period of availability of non-interstate funds.—” before “Sums”; (C) in paragraph (4) by inserting “Obligation as equivalent to expenditures; effect of release of funds.—” before “Sums”; and (D) by indenting paragraph (1) and aligning such paragraph and paragraph (4) with paragraph (2), as amended by subsection (a) of this section. (4) Section 118(c) of such title is further amended— (A) by indenting paragraph (1), as designated by subsection (b) of this section, and aligning such paragraph with paragraph (2), as added by such subsection (b); and (B) by striking out “Such amount” and inserting in lieu thereof “Subject to section 149(d) of the Federal-Aid Highway Act of 1987, such amount”. (5) The analysis for chapter 1 of such title is amended by striking out the item relating to section 118 and inserting in lieu thereof the following: “118. Availability of funds ”.