The Aviation and Transit Department, MET Transit Division, is seeking grant assistance from the Montana Department of Transportation (MDT) Transit Section, for paratransit operating support and the purchase of one paratransit van.  The deadline for filing this application is March 1, 2012.

The MDT grant application is two-fold.  The first portion of the application is a request for State funds for paratransit operating assistance.  The MDT Transit Section has three grant programs, TransADE ($50,000 request), Section 5317 New Freedom ($65,000 request), and Section 5316 Job Access Reverse Commute (JARC) ($150,000 request).  MET Transit plans to apply for funding from all three grant programs to provide paratransit operating assistance in the amount of $265,000.  All programs must be applied for annually and MET Transit is typically awarded the grants based on available funds on a year-to-year basis.  The State recognizes the rising costs of transporting elderly and disabled citizens, and the significant impact this has on operating budgets.  The intent of this funding is to encourage all agencies to provide coordinated transit service to elderly and disabled citizens.  In addition, this funding will help supplement operating expenses for paratransit service provided to newly annexed areas of the City, and to serve low income disabled citizens in Billings.  It is anticipated that the outcome from this grant request will be known by May 2012.

The second portion of the grant application would provide capital assistance for the purchase of one paratransit van.  The grant application is for $75,000, with the State share being $64,935 (86.58%) and a local share of $10,065 (13.42%), both of which will be budgeted in the FY 2013 Transit capital budget if the State awards the grant.

The Aviation and Transit Department, MET Transit Division, is seeking approval to file an application for both operating and capital assistance with the MDT, and approval for the Mayor to execute a grant agreement with the MDT once the grant offers are received by the City.    

The Council may:

• Approve the filing of the grant application for TransADE, 5317 New Freedom and 5316 JARC funds, for a total amount of $265,000 to go toward paratransit operating assistance and for a capital grant for the purchase of a new paratransit van; or
• Not approve the filing of the grant application for TransADE, 5317 New Freedom and 5316 JARC funds, for a total amount of $265,000 to go toward paratransit operating assistance or for the capital grant for the purchase of a new paratransit van.

These grants, if awarded to MET, would provide varying levels of reimbursement for paratransit expenses.  Under the TransADE grant, MET can be reimbursed $.5411 for every dollar spent on operating costs (driver wages and fuel), $.70 for every administrative dollar spent, and $.80 for every dollar spent on maintenance.  Under the JARC and New Freedom grants, MET can receive $.50 for every dollar spent on these same types of expenses up to the limit of the grants.  Because MET's annual expenditures are significantly larger than the grants, the drawdown against these grants is completed fairly early in the budget year.  The local match for these grants would be the remaining percentage of the incurred expenditures, which is commonly called a soft match.

Additionally, if successful, the Transit Division could receive $64,935 (86.58%) of the cost of a new paratransit van.

Staff recommends that the City Council approve the submittal of the grant application to the State and the execution by the Mayor of any subsequent grant agreement(s) with the MDT.