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March 16, 2009

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NEWS HEADLINES

Range of Grant Programs Covered in FTA ARRA Workshop
By JOHN R. BELL, Program Manager-Communications

The Federal Transit Administration, continuing its pledge to provide the latest information to public transportation professionals, conducted a workshop following APTA’s 2009 Legislative Conference on programs made possible through the American Recovery and Reinvestment Act.

Presenters at the workshop—who included Susan Borinsky, FTA assistant administrator for planning and environment, and Susan Schruth, FTA assistant administrator for program management—discussed the programs’ many components and requirements.

Sherry Riklin of FTA’s Office of Transportation Policy Development gave an ARRA funding overview, noting that the funding does not waive any FTA program requirements; regular processes and NEPA both apply. All programs other than New Starts are funded 100 percent by the federal government.

She stressed that transit systems must act now to ensure they meet the ARRA-specified deadlines: On Sept. 1, 2009, at 180 days after FTA’s publication of apportionments in the Federal Register, FTA will determine if systems have obligated 50 percent of received ARRA funding; unobligated funds from this 50 percent will be reallocated to other applicants. FTA will again review the funding at 365 days, on March 5, 2010, the second deadline for obligation of funds. On Sept. 30, 2010, any money not obligated goes back to the Treasury. Pre-award authority is applicable from October 1, 2008.

Riklin also emphasized that grantees may not mix ARRA funds with other FTA grant funds. However, she noted, this does not mean a system cannot use several sources of funds for a project—only that it must submit several different grant applications, as with New Starts.

FTA will probably hire additional staff to handle ARRA disbursement, she said.

Discussion of Specific Programs
Specific programs were also discussed in the workshop, including the Multimodal Discretionary Program, a $1.5 billion competitive grant program for capital investment. Projects must have a “significant impact” on the nation, local metro area, or local region. Grant awards will be $20 million-$300 million and will receive a 100 percent federal share.

New Starts and Small Starts
Eligible public transportation projects include New Starts and Small Starts. Considerations will include equitable geographic distribution of funds; inclusion of urban and rural projects; and up to $200 million to pay federal credit assistance subsidy costs. Priority projects are those that need federal funds to complete their financing package— “gap funding”— and those to be completed in three years.

Riklin stated that agencies will have 90 days after publication in the Federal Register to apply. FTA anticipates it will announce selected projects before its own 360-day deadline for doing so. Details for this program are still in development, she said.

Urban Area Formula Grants
Henrika Buchanan-Smith, of FTA’s Office of Program Management, discussed Urban Area Formula Grants, comprising $5.7 billion allocated to urbanized areas using Section 5307 formula. This includes Section 5340 but not transit intensive cities. The same deadlines listed above apply for these funds.

Eligible recipients for Urban Formula grants include all public transit providers. Capital expenses must be consistent with FTA Section 5302(a)(1) and can include preventive maintenance; engineering and design; ADA compliance (up to 10 percent); and crime prevention and security, excluding operational activities unless they are associated with emergency response drills and security training. Program requirements of Section 5307 apply, including the rule that cities with more than 200,000 residents must spend 10 percent for transit enhancement.

Non-Urbanized Area Formula Grants
Buchanan-Smith also discussed the nonurbanized area formula grants (NAFGs), per FTA Section 5311: $760 million, allocated to states through the 5311 formula. Each state sub-awards the funds to sub-recipients; the state is responsible for applying to FTA for these funds. This program has the same eligible activities as those for Urban Formula grants. Each recipient must spend 15 percent for inner-city bus service or certify exemption; FY 2009 certifications are sufficient, she noted.

Fixed Guideway Infrastructure Investment Program
The Fixed Guideway Infrastructure Investment program consists of $750 million to modernize, maintain, or improve existing fixed guideway systems. The same deadlines apply—50 percent by September 1, 2009 and the remainder by March 5, 2010. Fixed Guideway systems must be 7 years old or older and must have threshold of at least one mile. Allocations will be made under tiers 1,2,3, and partially tier 4, with the exception of Morgantown, WV, which was specified in the statute.

Tribal Transit Program
Mary Martha Churchman, also of the FTA, reviewed grants disbursed under the Tribal Transit Program, which comprises $17 million (2.5 percent of the total for non-urbanized areas).

Capital Investment Grants
Capital Investment Grants (New Starts and Small Starts) were discussed by Sherry Riklin. Priority will be given to projects in construction and those eligible to obligate funds within 150 days of Feb. 17, 2009. One benefit of ARRA funding is that it creates $750 million to $1.5 billion in commitment authority, depending on the allocation approach.

This process will begin with a project management office review of existing and soon-to-be-executed contracts. Cash flow needs will be based on contract payables, and FTA will look at different allocation scenarios based on need, equity, and completion of existing agreements. FTA hopes to announce allocations in the Federal Register this month.

Churchman reviewed reporting and certifications under ARRA. She noted a high degree of oversight and public interest from Congress and online. The president himself has noted that ARRA funds will be subject to “unprecedented transparency,” she said, and so systems should expect new reporting requirements. These will likely include the name of every contractor to whom grant funds are used to compensate, as well as the amount and purpose of each contract.

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