Small urban public transportation
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Small urban public transportation

The Small Urban Public Transportation Federal Grants Program (49 USC, Section 5307) enhances mobility in urbanized areas. There are 30 urban operators providing transportation in areas with populations between 50,000 and 200,000.

Eligible transit providers

Transit providers serving populations between 50,000 and 200,000 are eligible. McAllen and Arlington, both with populations over 200,000, are included because they are eligible for state funds.


Urban transit systems receive funding from a variety of sources, including the Federal Transit Administration (FTA) Section 5307 and 5309 grants, state grants, transit fares and local revenues such as advertising, contracts and city general revenue funds.

Federal and state funds are available for capital, planning and operating costs. Capital funds can be spent on buses and bus facilities, fixed guide-way system projects, technology introductions and innovative techniques and methods. Planning funds are available for engineering design, evaluation of public transportation projects and other technical studies. Allowable operating expenses are limited to direct labor, materials and overhead expenses incurred by the transit operator.

Program funds may be used for capital, planning, operating and administrative costs, with a maximum federal funding ratio for capital, planning and administrative costs of 80% and a maximum state/local match of 20% on most projects. Americans with Disabilities Act of 1990 (ADA) and Clean Air projects may receive up to 90% federal funding. The funding ratio for net operating costs is 50% federal match and 50% state/local match.

Funds are distributed by the FTA using a formula based on population and population density. In areas with populations over 200,000, grants are awarded directly to the local recipient. Grants for urban areas with populations under 200,000 may be made to the governor or to local recipients designated by the governor. Currently, cities apply directly to FTA.