Public transit throughout the United States is funded by the Federal Transit Administration (FTA) and local governments. The FTA funds transit in many different ways, such as elderly and disabled, rural and urban allocations.  The four major cities of Northwest Arkansas (Fayetteville, Springdale, Rogers and Bentonville are in an urbanized area.  Urbanized areas are funded by the FTA based upon population and population density.  The FTA funds operations in urbanized areas from 50,000 to 200,000, but does not when population in an urbanized area is over 200,000.  This is an important issue to both Ozark Regional Transit and Razorback Transit in the next U.S. census in 2010. 

 

Local Governments, be they city, county or combinations of both cities and counties typically fund their share of a transit system through a dedicated funding source, and the most common ways are out of a governmental general fund, property or sales taxes.  This money is then used to “match” the money that the FTA provides.  However, it is important to note that most transit systems over-match or exceed the FTA funding so as to provide adequate transportation for their community.  The amount to match is a local decision.  Communities are not required to take the FTA money.

 

FTA funds can be used in many ways, such as capital, operations, preventative maintenance and administration. Capital is items such as buses, facilities shop equipment, computers, bus shelters, or other items that have a long “useful” life. Preventative maintenance (such as repairing buses) is also a 20 percent match. Operations are a 50 percent match.

 

The amount of FTA money for the urbanized area in NW Arkansas is $1.8 million, with it split 55 percent or $1M to ORT and 45 percent or $800,000 to Razorback Transit. ORT serves 110 square miles of the urbanized service area, and Razorback Transit serves 18 square miles.

In 2001 Ozark Regional Transit’s budget was $1.6M, and the local government match was $100K. Today the budget is $2.6M and the local government match is $800,000.

Responsibility for providing public transportation has been traditionally shared by federal, state, and local governments. Passenger fares and co-payments also help cover the cost of delivering transit service. Finally, transit systems look for ways to earn extra revenue, through the sale of advertising, for example.  
     
Funding Sources
Federal Transit Administration
State of Arkansas
Local Governments in NW Arkansas
Advertising
Passenger Fares