Item B: Surface Transportation Program - Urban Funding

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ECC UGENE ITY OUNCIL AIS GENDA TEM UMMARY Work Session: Surface Transportation Program - Urban Funding (STP-U) Meeting Date: February 23, 2009 Agenda Item Number: B Department: Public Works Staff Contact: Rob Inerfeld www.eugene-or.gov Contact Telephone Number: 682-5343 ISSUE STATEMENT Lane Transit District (LTD) is facing a significant funding shortfall that could lead to cuts of as much as 15 percent in the agency’s bus service. To help address this shortfall, LTD has proposed that over each of the next two years, $1 million of the STP-U funds that are distributed to our metro area be allocated to LTD. This issue will be on the agenda of the March 12 Metropolitan Policy Committee (MPC) meeting. The City’s MPC representatives are seeking direction from the council on this issue in advance of the MPC meeting. BACKGROUND As an urbanized area of over 200,000, the Central Lane Metropolitan Planning Organization (MPO) area receives an annual distribution of flexible funds from the federal Surface Transportation Program. In recent years, our metropolitan area has received between $2.5 and $3 million per year in STP-U funds. In the most recent funding rounds, the STP-U funds were distributed in the following categories: ·10% for Transportation Options (TO) ·25% for Planning ·65% for Capital Projects – Project Development, Preservation, and Modernization The most recent projection for the amount of STP-U funding the MPO will receive next fiscal year is $2.475 million of which about $1.6 million would be available for capital projects if the distribution by project type stays the same. If LTD’s proposal is approved by the MPC, then about $600,000 per year would be available for other capital projects. LTD is proposing to use $1 million in STP-U capital funds over each of the next two years to supplant other capital funds LTD receives that could be reprogrammed to support bus operations. LTD is currently projecting a 15 percent service cut that could vary depending on payroll tax revenue and other variables. The STP-U funds would enable LTD to reduce the size of any service cuts by six percent of overall service; in other words, with the STP-U funding, the service reductions would be 40 percent smaller than currently projected. If LTD were to receive these funds, it would commit to not seeking other STP-U capital funds for the following three years. If LTD’s proposal is approved by the MPC, there is the option of reconsidering the second year of funding in light of changes in funding and revenue outlooks for both transit and other transportation modes. Attachment A contains LTD’s proposal in more detail. Z:\CMO\2009 Council Agendas\M090223\S090223B.doc