Financial Plans

Purpose

The preparation of a Financial Plan ensures compliance with 23 U.S.C 106(h) and 106 (i) that you have identified the available financial resources and will manage those resources throughout the life of the project. This guidance directs you to the process you need to create the Financial Plan.

When to use this subject

You need to prepare an Initial Financial Plan for projects that:

Are approaching a total project cost estimate (TPCE) of $100 million or more, regardless of their funding type
Are between $100 million and $500 million that use federal funds regardless of funding type
Are major and have a TPCE of $500 million or more

You can find the guidance for developing Financial Plans at the Federal Highway Administration’s (FHWA) Major Projects Financial Plans website and the FHWA Financial Plan Checklist (PDF). Follow this guidance when drafting the Initial Financial Plan and any future updates. Work with the Financial Plan Coordinator to obtain the templates you need to develop the Financial Plan.

You must have a TPCE to support your Financial Plan. You can find guidance to develop the TPCE at the Project Management website and the internal cost site.

Additional requirements are necessary if FHWA determines the project to be a major project. If a major project, you will also need to submit a Project Management Plan (PMP), prior to a financial plan. You can find guidance for developing the PMP at FHWA Major Projects PMPs.

For specific process information, see the process page and/or contact the individual on the contacts page.

How this subject fits into the overall project development process

As soon as the state enters the project into the State Transportation Improvement Plan (STIP), you can begin working on the Financial Plan. Completing the Financial Plan early provides sufficient time to provide it to leadership for review and comment on it and to hold a review meeting with FHWA. From the review meeting, any issues with the financial plan will be addressed and suggested edits will be incorporated, if necessary, prior to submitting the Financial Plan to FHWA.

Once the state has let and awarded the Design-Bid-Build (DBB) or Design-Build (DB) contract for the project, you will need to revise the Initial Financial Plan, annually, to show the difference between the Initial Financial Plan and the annual update. The Initial Financial Plan for a Construction Manager/General Contractor (CMGC) will be completed prior to entering a construction contract with the CMGC contractor and annually thereafter. All financial plans will have annual updates until substantial completion or when the FHWA determines otherwise.

Each year, you will provide an annual update to the Financial Plan that provides current project status compared to the baseline and shows the progress of the project by emphasizing any major deviation from the Initial Financial Plan and any previous updates. Continue to provide Annual Updates at least through the substantial completion date of the construction project unless the FHWA specifies another date.

Organizations involved

MnDOT:

Office of Financial Management
Project Managers

US DOT
FHWA, Division Office
Other state and local partners