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Federal Formula Grants: Federal Transit Assistance Programs
Tim Ransdell and Shervin Boloorian

September 2004

The nation’s last major surface transportation law, enacted in 1998, was the Transportation Equity Act for the 21st Century or TEA-21. The law expired on September 30, 2003, without Congress having reauthorized it, but temporary extension bills have kept TEA-21’s provisions operational. Under TEA-21, California has received more federal transit funding than any other state through the two major types of federal transit assistance—“formula grants” and “capital investment grants.” This report describes the data sources and formula programs used to determine the share each state receives in formula transit funds. It then discusses capital investment grants and loans, which support projects too large in scale to be sustained consistently by formula apportionments alone. Finally, it examines in detail the various proposals from the White House, the Senate, and the House for reauthorizing TEA-21.