(a) The director of transportation shall arrange for the installation of all utility cables and facilities below the ground, within a berm or away from the alignment of a highway, during the design or redesign and construction or reconstruction phases of any new or existing federal-aid highway project, when a determination is made that federal highway funds are available to pay for the federal share of the cost differential between underground and overhead facilities.
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(b) The director of transportation may make exceptions to subsection (a) if:

(1) The director determines that exceptions are appropriate due to either:

(A) Any of the following criteria: environmental, safety, research, technology, corridor alignment, or management concern; or
(B) The following criteria collectively: state funding impacts, economic feasibility, and federal funding concerns; or
(2) The projects do not lend themselves to undergrounding, such as: resurfacing, traffic signal installation, drainage installation, bikeway markings, guardrail installation, traffic markings, and enhancement improvements.
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