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Press Release · September 27, 2004

Federal Formula Grants and California: Federal Transit Assistance Programs

Due to its heavily urbanized population, California received a large (15%) share of federal transit formula grant spending over the past seven years. In 2003, the state’s transit agencies, local governments, and Caltrans used $762 million in federal transit formula grants to support bus, subway, commuter rail, ferry, and other forms of public transportation.

California’s large share of transit grants partially compensates for the state’s relatively meager portion of federal highway receipts under TEA-21 – the Transportation Equity Act for the 21st Century – that Congress is still working to renew. Some proposed formula changes in pending House and Senate bills would reduce California’s share of transit funding by expanding grants to rural states at the expense of urban ones. Federal Formula Grants and California: Federal Transit Assistance Programs outlines the structure of transit formula programs, examines the mechanics of formulas used to determine funding levels for California and other states, and discusses legislative proposals in Congress that seek to change these formulas.

This report is the eighth in an ongoing series reviewing California’s share of federal formula grant programs. Upcoming reports will examine funding for child care and higher education. The series was developed at the request of the bipartisan leadership of California’s congressional delegation and is produced by PPIC in collaboration with the California Institute for Federal Policy Research. A February 2003 report reviewed federal highway formula spending.

We hope you find this and future reports valuable, and we welcome your feedback as we seek to inform the public debate regarding this important subject. If you have any questions, please contact us by phone (Abby: 415/291-4436; Victoria: 415/291-4412) or email (; You can reach the authors, Tim Ransdell and Shervin Boloorian of the California Institute, at 202/546-3700 or

The Public Policy Institute of California is a private, nonprofit organization dedicated to improving public policy in California through independent, objective, nonpartisan research on major economic, social, and political issues. The institute was established in 1994 with an endowment from William R. Hewlett. PPIC does not take or support positions on any ballot measure or on any local, state, or federal legislation, nor does it endorse, support, or oppose any political parties or candidates for public office.