Editor’s note: This is one in a series of posts about the development of Capital Metro’s FY2012 budget. You can get involved with the process by voting on ideas and sharing your own on the icanmakeitbetter online forum, or checking out the resources available on capmetro.org.
One of Capital Metro’s most important funding sources is funding from the federal government which we receive in the form of grants, usually through the Federal Transit Administration.
One program, called the 5307 Urbanized Area Formula Program, provides us with an annual grant as part of a national program that distributes federal aid to transit agencies. The grant program is one of our largest and most consistent sources of funding. As the name implies, the funding is distributed to cities and surrounding areas based on a formula that weighs population and other factors. This year we’ll receive a little over $20 million under this grant, accounting for a little more than 10% of our operating budget.
Beyond its size, the 5307 grant is important because Cap Metro can use it both for capital projects, like buying and maintaining buses, and also for some specific operating costs like paying the companies we contract with to help provide our services. As I am sure you can imagine, since this is the federal government, a big part of the program is keeping up with the paperwork, and that task keeps our federal funding expert busy pretty much all of his work day. There always are reports to file and new grant applications to be completed.
Capital Metro also receives several other types of federal grants. In 2009, in the wake of the national recession, for example, many public agencies, including Cap Metro, received what has come to be known in the media as federal stimulus funding. Under the stimulus program, actually the American Recovery and Reinvestment Act (ARRA), the federal government made grants to state and local agencies for a wide range of capital projects—remember all the talk in the news about “shovel-ready” projects?
We received about $26 million in stimulus funds, which we mainly used to modernize our bus fleet; however, we also have used some of the funds for our “Rails with Trails” program. Most public agencies have now used up their ARRA funds, and we are no exception. We have about $1.8 million left for “Rails with Trails,” but we do have some very fine buses to show for our federal dollars.
Let me note one final point about federal funds. Our federal funding is subject to the federal budget gyrations you often hear about on the news. The federal government has its own financial issues, and so we closely monitor what’s going with transit programs, planning both for how to use the federal aid we receive and for what to do if it doesn’t come through. Hey, it’s Uncle Sam. It comes with the territory.