Section 5307 urbanized area formula funds are available for transit improvements for 34 urbanized areas over 1 million population, 91 urbanized areas with populations between 200,000 and 1 million, and 281 urbanized areas between 50,000 and 200,000 population. For urbanized areas over 200,000 in population, funds flow directly to the designated recipient. For areas under 200,000, the funds are apportioned to the Governor of each state for distribution.
Several changes became effective to this program in fiscal year 1998 with the passage of TEA-21. One percent of appropriated Section 5307 funds was set-aside to be used for transit enhancement projects that physically or functionally enhance transit service or use. Preventive maintenance, defined as all maintenance costs, became eligible for FTA capital assistance at an 80 percent Federal share. FY 2002 operating assistance is available only to urbanized areas with populations under 200,000. An exception is made in TEA-21 for urbanized areas over 200,000 population if the number of total bus revenue vehicle miles operated is under 900,000 and the number of buses operated does not exceed 15. Up to 10% of an area's apportionment may be used for complementary ADA paratransit service cost.
The Alaska Railroad received a special appropriation of Section 5307 funds amounting to $4.85 million (including oversight) in FY 2002 for improvements to its passenger operations. No funds were obligated for this purpose during FY 2002.
In FY 2002, a total of $4.3 billion of Section 5307 funds was obligated, about $132 million (3%) more than the total obligated in FY 2001. Of this amount, $4 billion or 93 percent was used for capital; $235.5 million or 6 percent for operating; and $59.9 million or 1 percent for planning assistance. Funds were obligated to 440 FTA grantees. As a group, the urbanized areas with population over 1 million obligated the largest share of the funds, $3.2 billion or 74 percent. The total number of vehicles approved was 4,766, an increase of 439 compared to FY 2001. Bus rehabilitation totaled $18.8 million.
As in previous years, flexible funds transferred from FHWA had a significant impact on the availability of funds for obligation. In FY 2002, a total of $1.0 billion was transferred to the urbanized area formula program. The total flexible funds obligated for this program were $1.1 billion, some of which was carryover of funds transferred in prior years. Of the total obligations for capital (planning included), about 27 percent represents flexible funds. The program sources of these obligations are: Congestion Mitigation and Air Quality (CMAQ), $704.7 million (66 percent); and Surface Transportation Program (STP), $304.3 million (28 percent) and FHWA earmarks $61.4 million (6 percent).