The Section 5309 program provides funding for the establishment of new rail or busway projects (new systems), the improvement and maintenance of existing rail and other fixed guideway systems, and the upgrading of bus systems. Capital assistance grants made to states and local agencies are funded up to 80% of the net project costs, unless the grant recipient requests a lower Federal grant percentage. In FY 1999, the Section 5309 obligations totaled $2.1 billion, about 25% higher than obligations in FY 1998. Funds were obligated to 174 grantees. The total number of buses and related vehicles budgeted in FY 1999 was 1,535, or 604 more than budgeted in FY 1998.
This category includes acquisition of bus and rolling stock and ancillary equipment, and the construction of bus facilities (i.e., maintenance facilities, garages, storage areas, bus terminals and the like). In FY 1999, the bus allocation was $497.6 million . At least 5.5% of Section 5309 funds must be used in non-urbanized areas. In FY 1999, the Section 5309 obligations for bus were $413.9 million, an increase of $201.1 million from FY 1998.
TEA-21 modified the formula for allocating the fixed guideway modernization. The new formula consists of seven tiers rather than four. The allocation of funding under the first four tiers has been modified slightly and, through fiscal year 2003, will be allocated based on data used to apportion the funding in fiscal year 1997. Funding in the three new tiers will be apportioned based on the latest available route miles and revenue vehicle miles on segments at least seven years old as reported to the National Transit Database, rather than on route miles and revenue vehicle miles on entire systems which are seven years old. Typically funded are infrastructure improvements such as track and right of way rehabilitation, station modernization, rolling stock renewal, safety-related improvements, signal and power modernization. In FY 1999, the Section 5309 obligations for fixed guideway modernization were $838.7 million, up $69.3 million from the previous fiscal year.
New system funding provides for construction of new fixed guideway service. FTA writes recommendations to Congress for new system funding in the annual New Starts Report. In FY 1999, funding for new systems projects was fully allocated by Congress. The obligations for Section 5309 new systems were $812.1 million, up $146.1 million from FY 1998.