City Council Regular Meeting
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New Business   Item #: B.
Fiscal Year 2021 Federal and State Transit Funding
Business Meeting: 01/19/2021
The City of Danville makes application annually to the Virginia Department of Rail and Public Transportation for federal and state operating and capital assistance. State operating and capital funding levels can vary annually and are typically approved in June by the Commonwealth Transportation Board. All operating expenses are eligible for federal operating aid except depreciation and interest charges. The Federal Transit Administration will typically provide financial assistance up to fifty percent of the transit system's operating deficit and up to eighty percent of the total cost of capital projects. For small urban and rural transit systems in Virginia, the Virginia Department of Rail and Public Transportation maintains the authority to allocate federal funding for operating and capital assistance.
Due to the COVID-19 pandemic, funding levels for this fiscal year were not confirmed by the state until December 2020 and increased federal operating and capital aid is available due to CARES Act funds. Consequently, all capital projects will be financed at one hundred percent with federal aid. Therefore, no local match is required for capital projects this fiscal year and additional operating aid is available to finance eligible operating expenses.
For Fiscal Year 2021, the Virginia Department of Rail and Public Transportation identified that a total of $2,759,779 in CARES Act funds is available to subsidize operating expenses and $121,801 in additional state operating aid is allocated to Danville. Last fiscal year, Danville received $1,213,756 in federal operating aid and an additional $507,325 in state operating aid was received. Due to the availability of CARES Act funds, this fiscal year Danville is receiving $1,160,499 more in federal and state operating aid than last fiscal year.
The state has also approved CARES Act funds for the following capital projects: two, 28-passenger replacement buses for the fixed route service, one pickup truck, twelve replacement tablets that are installed in buses and used to support reservation based operations, one, 14-passenger replacement bus and new flooring for the Transfer Center. The estimated total cost for all capital projects is $460,582 and typically these projects require a four percent local match. However, due to CARES Act funds, no local match is required for capital projects, which results in a local savings of $18,423.
It is recommended that City Council adopt the attached Resolution authorizing an application to the Virginia Department of Rail and Public Transportation for Mass Transit funding for Fiscal Year 2021.
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