TO: Mayor and Members of City Council
THRU: Michael Gibson, Interim Assistant City Manager
Jeffrey Yates, ICMA-CM, Assistant City Manager
FROM: Tyffany L. Neal, MPA, Transit Director
Taylor Floyd, Budget and Evaluation Director
DATE: October 12, 2026
RE:Title
Accept and Appropriate $117,938 in NCDOT Reimbursement Funding for Transit Bus Purchases and authorize the City Manager to execute necessary agreementsTitle
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COUNCIL DISTRICT(S):
Council District(s)
All
b
Relationship To Strategic Plan:
The reimbursement supports Strategic Plan Goal IV, Desirable Place to Live, Work and Recreate, by supporting investment in safe, reliable transit service. State participation in the cost of bus purchases reduces the City’s funding contribution and helps preserve local resources while maintaining the transit investments already approved.
Executive Summary:
Capital Project Ordinance Amendment 26-0590 would accept and appropriate $117,938 from the North Carolina Department of Transportation (NCDOT) to reimburse a portion of the City’s funding contribution for transit bus purchases under Federal Transit Administration Grant 2022-059. The state contribution covers 10% of the eligible purchase cost, replacing half of the 20% share originally funded by the City for that purchase. The amendment changes the project’s funding sources without increasing its $5,676,500 budget. Staff recommends returning the $117,938 in replaced City funding to the General Fund.
In addition, this item authorizes the City Manager to execute necessary agreements.
Background:
The City’s transit capital project was established through Capital Project Ordinance 2023-11, adopted October 10, 2022, for battery electric and hybrid buses and charging infrastructure funded under Federal Transit Administration Grant 2022-059. A local match is the portion of an eligible purchase cost that federal grant funding does not cover. Under the NCDOT Transit Capital Purchase Municipal Reimbursement Agreement, federal funding covers 80% of the eligible bus purchase cost, NCDOT provides 10%, or $117,938, and the City funds the remaining 10%. The proposed amendment replaces $117,938 of previously budgeted City funding with the state reimbursement. The General Fund pay-as-you-go funding, meaning existing City resources rather than borrowing, was the original funding source.
Issues/Analysis:
The state reimbursement reduces the City’s share of eligible purchase costs while preserving the approved project budget and scope. Payment requires an invoice and supporting documentation under the reimbursement agreement. The ordinance reduces the transfer from the Transit Operating Fund by $117,938; because the original contribution is identified as General Fund pay-as-you-go funding, staff recommends the related fund transfers to ensure that the released amount is returned to the General Fund.
Budget Impact:
The amendment adds $117,938 in NCDOT revenue and reduces the budgeted Transit Operating Fund transfer by the same amount, from $885,325 to $767,387. Federal funding remains at $4,791,175, and total project revenues and expenditures remain at $5,676,500. Staff recommends returning $117,938 in previously committed General Fund pay-as-you-go funding to the General Fund balance through the necessary fund transfers. This action requires no additional General Fund contribution and does not authorize spending of the returned funds.
Options:
1. Adopt Capital Project Ordinance Amendment 26-0590 to accept and appropriate $117,938 in NCDOT reimbursement funding, reduce the City-funded contribution by the same amount, and authorize the necessary financial and budgetary actions to return the released City funding to the General Fund authorization, thereby allowing the City Manager to execute the necessary agreements.
2. Do not adopt Capital Project Ordinance Amendment 26-0590 at this time and provide further direction to staff regarding the reimbursement and project funding.
Recommended Action::Recommended Action
Adopt Capital Project Ordinance Amendment 26-0590 to accept and appropriate $117,938 in NCDOT reimbursement funding, authorize the necessary budgetary and financial actions to return the City funding used to replace the reimbursement to the General Fund, and authorize the City Manager to execute the agreements necessary to implement the reimbursement.
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Attachments:
Capital Project Ordinance Amendment 26-0590
NCDOT Transit Capital Purchase Municipal Reimbursement Agreement