Fuel Tax Evasion-Intergovernmental Enforcement Effort

 

The purpose of this program is to increase intergovernmental activities and enforcement efforts among public agencies to reduce Federal and State fuel tax evasion. Funds made available shall be used only to expand or enhance intergovernmental efforts to increase motor fuel tax enforcement and payments; to supplement motor fuel tax examinations and criminal investigations; and to increase research and training in the area of fuel tax evasion. This program is part of the Highway Use Tax Evasion program which also may provide funds to the Internal Revenue Service (IRS) for their efforts as outlined in 23 U.S.C. 143.

General information about this opportunity
Last Known Status
Active
Program Number
20.240
Federal Agency/Office
Federal Highway Administration, Department of Transportation
Type(s) of Assistance Offered
B - Project Grants
Program Accomplishments
Fiscal Year 2016 Funds will likely also be used to expand auditing and tracking programs, including enhancements to data systems. Funds have not been awarded for FY 2015 and 2016 as of May 2017. However, prior awards are still used to support training, and a few individual projects in the States. These may include enforcement programs, and enhancements to data systems.
Fiscal Year 2017 Funds will likely also be used to expand auditing and tracking programs, including enhancements to data systems. When diesel fuel leaves the bulk terminal, fuel to be used in a non-taxable fashion (off-highway use) is injected with a red dye. At both the Federal and State level, fuel taxes are not imposed on dyed fuel. Many States have enforcement initiatives where vehicles are randomly checked for the presence of red dye in the fuel. Several of the awards will likely be used to start or enhance existing programs in testing for dyed fuel.
Fiscal Year 2019 Highway Use Tax Evasion Training and Enforcement FFY2019 allocation of new funding for partial FFY2019 - FFY2020.
Authorization
Fixing America’s Surface Transportation Act (FAST Act), Public Law 114-94, 23 U.S.C. 143
Who is eligible to apply/benefit from this assistance?
Applicant Eligibility
States, and the District of Columbia,
Beneficiary Eligibility
States, and the District of Columbia.
Credentials/Documentation
Not applicable.
What is the process for applying and being award this assistance?
Pre-Application Procedure
Preapplication coordination is not applicable.
Application Procedure
This program is excluded from coverage under 2 CFR 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards.
Award Procedure
Awards are scheduled to be made for Fiscal Year 2018. FHWA and IRS will jointly recommend and approve projects for Federal funding for fuel tax evasion intergovernmental enforcement efforts. States selected to receive funding will enter into negotiations with FHWA and be required to enter into a project agreement with FHWA.
Deadlines
No. Due to needed changes in the content of the grant announcement, we have not yet announced the availability of the 2018 grants. When we do, we will allow approximately 60 days from the Notice of Funding Opportunity (NOFO) date.. Not available at this time. Contact the headquarters or regional location, as appropriate for application deadlines
Approval/Disapproval Decision Time
Not applicable.
Appeals
Not applicable.
Renewals
Not applicable.
How are proposals selected?
Applicants are encouraged to submit innovative proposals to reduce fuel tax evasion and increase collaboration and coordination among several public agencies. Priority will be given to proposals that involve more than one public agency. FHWA and the IRS will review the proposals using a scoring process that includes consideration of completeness of the application, enforcement potential, innovation, intergovernmental inclusion, and risk of success.
How may assistance be used?
State agencies can use the funds to expand efforts to enhance motor fuel tax enforcement; to supplement motor fuel tax examinations and criminal investigations; to develop automated data processing tools to monitor motor fuel production and sales; to evaluate and implement registration and reporting requirements for motor fuel taxpayers; to reimburse State expenses that supplement existing fuel tax compliance efforts; to analyze and implement programs to reduce tax evasion associated with other highway use taxes; to support efforts between States and Indian tribes to address issues relating to State motor fuel taxes; and to analyze and implement programs to reduce tax evasion associated with foreign imported motor fuel.
What are the requirements after being awarded this opportunity?
Reporting
Not applicable.
Auditing
Not applicable.
Records
Participating agencies must keep records of expenditures/accomplishments as applicable.
Other Assistance Considerations
Formula and Matching Requirements
Statutory formula is not applicable to this assistance listing.

Matching requirements are not applicable to this assistance listing.

MOE requirements are not applicable to this assistance listing.
Length and Time Phasing of Assistance
There is no statutory expiration of the funds once awarded. Method of awarding/releasing assistance: Lump.
Who do I contact about this opportunity?
Regional or Local Office
None/Not specified.
Headquarters Office
Michael Dougherty,
1200 New Jersey Ave. S.E.
Washington, DC 20590 US
michael.dougherty@dot.gov
Phone: (202) 366-9234.
Website Address
https://www.fhwa.dot.gov/policyinformation/motorfueldata.cfm
Financial Information
Account Identification
69-8083-0-7-401
Obligations
(Project Grants) FY 18$38,384.00; FY 19 est $40,000.00; FY 20 est $40,000.00; FY 17$7,626,160.00; FY 16$738,057.00; - The source of funds for this program is a deduction (set-aside) of not more than $4 million per year from the funds authorized for FHWA administrative expenses. Of the amount set-aside, $2 million must be reserved to make grants for intergovernmental enforcement efforts, including research and training.
Range and Average of Financial Assistance
Minimum: $10,000; Maximum $250,000
Regulations, Guidelines and Literature
Not applicable.
Examples of Funded Projects
Fiscal Year 2016 Final grants will not be awarded until all applications are reviewed after the July 31, 2016 deadline, and approved by FHWA Administrators. Several of the awards will likely be used to start or enhance existing programs. Funds will likely also be used to expand auditing and tracking programs, including enhancements to data systems. Awards have not been made using 2016 funds as of May 2017. However, several States continue to use funds from previous awards. Examples of the uses include participation by States in the Joint Operations Center for National Fuel Tax Compliance (JOC) which is a cooperative program between the FHWA, the IRS, and individual States excise taxing agencies. Information from distributor’s reports to the States and the IRS are compared and combined with other data sets to identify “anomalies” or questionable transactions. This can greatly reduce the number of transactions that internal or field staff must review. It is very helpful in identifying potential missed tax payments. Other projects include funding for States to attend fuel tax training for auditors and enforcement agents. Funds are used for additional enforcement efforts, and in some cases, funds have been applied to enhancements of data systems (Oregon, Alabama).
Fiscal Year 2017 Awards have not been made using 2017 funds as of June 2018.
Fiscal Year 2018 Awards have not been made using 2018 funds, although they will be combined with FY 2017 funds for awards made in response to the NOFO yet to be published.

 



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