TO: Mayor and Members of City Council
THRU: Kelly Olivera, CLGBO, Assistant City Manager
FROM: Tyffany L. Neal, MPA, Transit Director
Kimberly Leonard, CLGBO, CLGFO, CPA, MPA,
Budget and Evaluation Director
DATE: October 14, 2024
RE:
Title
Adoption of Capital Project Ordinance 2025-25 and Special Revenue Ordinance 2025-10 to Appropriate Federal Transit Administration FY24 Grant NC-2024-075-00 and the Required Local Match.
end
COUNCIL DISTRICT(S):
Council District(s)
All
b
Relationship To Strategic Plan:
Goal 4: Desirable Place to Live, Work and Recreate
Executive Summary:
The City has been awarded a grant from the U.S. Department of Transportation via the Federal Transit Administration (FTA) in the amount of $3,684,000.
The Council is asked to adopt Capital Project Ordinance (CPO) 2025-25 and Special Revenue Ordinance (SRO) 2025-10 to appropriate $1,080,000 of federal grant funding and $270,000 of required local match for various capital projects, planning activities, safety related projects, and contracted services. The required local match will be provided by a transfer from the Transit Operating Fund.
The remaining $2,604,000 of the grant award was appropriated with the adoption of the City’s fiscal year 2023-2024 (FY24) Annual Operating Budget to offset fixed route and ADA paratransit operating and preventive maintenance costs incurred during that fiscal year.
Background:
The FTA provides federal grant funding for eligible public transportation projects. The Fayetteville urbanized area receives an annual apportionment under FTA’s Section 5307 Urban Formula Program. Once potential uses of the funding are identified by Transit staff, a formal application is submitted to FTA to access and receive these funds. The application outlines in detail the specific uses of the grant funding.
Transit staff typically utilizes a significant portion of the FTA apportionment to support its annual operating budget in the form of preventive maintenance reimbursement, ADA paratransit reimbursement, and fixed route operating assistance. FTA grant NC-2024-075-00 provides $1,384,000 of federal funding for annual preventive maintenance costs, $375,000 of federal funding for annual ADA paratransit service costs, and $920,000 of federal funding for annual fixed route operating costs. These funds were previously appropriated by Council with the adoption of the City’s FY24 Annual Operating Budget. The award from FTA was received after the close of the associated fiscal year due to a delay in the release of apportionments at the federal level. Traditionally, these funds are awarded and received during the fiscal year to which they apply.
Capital Project Ordinance 2025-25 appropriates $990,000 for the purchase of seven support vehicles, the purchase and installation of bus stop amenities, the upgrade of the video surveillance system, the replacement of bus tracking software, and other capital maintenance costs. The funding sources for this appropriation are $792,000 of federal grant funding and a required local match of $198,000 provided by the Transit Operating Fund.
Special Revenue Ordinance 2025-10 appropriates $360,000 for project management, metropolitan planning, and other related activities. The funding sources for this appropriation are $288,000 of federal grant funding and a required local match of $72,000 provided by the Transit Operating Fund.
Issues/Analysis:
As indicated above, this award includes $2,604,000 for routine operating and maintenance expenditures for fixed route and ADA paratransit services incurred in FY24. These revenues were previously appropriated by Council in the FY24 Annual Budget Ordinance. Although the grant award was received after the close of the fiscal year, the funds will reimburse the General Fund for a portion of the subsidy it provided to the Transit Operating Fund for FY24. The grant award was delayed in FY24 due to a delay in the release of apportionments at the federal level.
Budget Impact:
The required local match of $270,000 will be provided by a transfer from the Transit Operating Fund for CPO 2025-25 and SRO 2025-10. There is no impact to the fiscal year 2024-2025 General Fund budget.
Options:
1) Adopt Capital Project Ordinance 2025-25 and Special Revenue Ordinance 2025-10.
2) Do not adopt Capital Project Ordinance 2025-25 and Special Revenue Ordinance 2025-10 and provide further guidance to staff.
Recommended Action:
Staff recommends that the Council move to adopt Capital Project Ordinance 2025-25 and Special Revenue Ordinance 2025-10.
Attachments:
Capital Project Ordinance (CPO) 2025-25
Special Revenue Ordinance (SRO) 2025-10
FTA FY24 Grant NC-2024-075-00