Transportation Development Act Allocation

1. APPROVE Monterey-Salinas Transit's application for State Transportation Development Act funds; and
2. ADOPT Resolution 2021-10 allocating a total of $22,334,739 in Transportation Development Act funds to Monterey-Salinas Transit, composed of $18,341,184 in Local Transportation Funds and $3,992,555 in State Transit Assistance funds for Fiscal Year 2021-22. 

The Transportation Development Act provides two major sources of funding of public transportation in California. The first, the Local Transportation Fund is derived from a 1/4 cent of the general sales tax collected statewide. The second, the State Transit Assistance fund is derived from the statewide sales tax on diesel fuel and distributed back to transportation planning agencies on a population-based (Public Utilities Code 99313) and transit operator revenue-based (Public Utilities Code 99314) formula. 

Each February, the Transportation Agency prepares an estimate of the Local Transportation funds it expects to be available in the coming fiscal year. The Local Transportation Fund estimate for Monterey-Salinas Transit is $18,342,184. 

Local Transportation Funds are apportioned to eligible uses in the following priority order, pursuant to state law:

1. Transportation Agency Administration and Planning;
2. Bicycle & pedestrian projects via the Transportation Development Act 2% program;
3. Public transit by jurisdiction, based on population as reported by the Dept of Finance; and 
4. Construction and maintenance of local streets and roads. 

Transit operators may use State Transit Assistance funds for transit operations and capital projects. For operations, new state law requires transit operators to comply with efficiency standards to demonstrate that the operating cost per revenue vehicle hour is increasing by no more than the Costumer Price Index. For capital projects, there are no restrictions. It is notable that while MST met the standard 15% farebox recovery ratio, that requirement through the Transportation Development Act was waved through Assembly Bill 90 for the fiscal years impacted by the COVID-19 pandemic (2020-2021 and 2021-2022).

TAMC no longer allocates Local Transportation Funds for local streets and roads projects, and is therefore no longer required to adopt a finding on unmet transit needs. However, prior to allocating Local Transportation Funds, TAMC is required to conduct a public hearing and outreach to identify unmet transit needs. The unmet transit needs process was conducted earlier this year and the Board of Directors received the Unmet Transit Needs List at the June 23, 2021 meeting.