Research Triangle Park, NC (June 6, 2018) – In explaining a provision in the proposed state budget that directly affects only light-rail transit projects, lawmakers last week suggested there may be some “ambiguity” in the requirements to receive federal funding for large transit projects like Durham and Orange counties’ light rail.
In response, GoTriangle reached out to the Federal Transit Administration and confirmed that 50 percent of a major project’s funding must be committed by state, local and other sources before the commitment of federal funds. We understand that confirmation of this policy has also been distributed to legislative staff members.
See federal guidelines here.
The Durham-Orange counties' light-rail project, a 17.7-mile light-rail line between UNC Hospitals in Chapel Hill and North Carolina Central University in Durham, is competing for a federal investment of more than $1.2 billion in much-needed North Carolina infrastructure.
As of 2016, North Carolina law caps state contributions toward major transit projects at no more than 10 percent of the cost, or up to $247 million in the case of the Durham-Orange counties' light-rail project. To put the $247 million state investment in perspective, the light-rail line is expected to generate at least $175 million in new state and local tax revenue each year.
Local governments and boards directed GoTriangle to complete the environmental and financial planning and other work that the federal government’s Project Development phase requires, and in 2017 the FTA approved the light-rail project to move into the final design (or engineering) phase.
GoTriangle planned to submit the final application for federal funding by the end of 2018, expecting to receive approval by September 2019 through a Full Funding Grant Agreement. Construction of the light-rail project would begin in 2020, and by 2027 the line would be open and connecting three major universities and medical centers, offering access and opportunity to more job-seekers and employers and creating tens of thousands of jobs.
We have also heard concerns that state funding for the Durham-Orange light rail project would be left sitting on the sidelines for a long period of time. This is not the case because construction would begin in 2020 using state and federal money.
Twice, the light-rail project has received high scores in the state’s own transportation prioritization process, a process created to take politics out of transportation planning. As the new budget provision is written, NCDOT would not be allowed to score a light-rail project or commit any state funding until all other funding including federal money is committed. The federal funding process does not allow that, so North Carolina would no longer be eligible for any federal grants for light rail.
Without federal funding, Durham and Orange counties’ light-rail project cannot be built.
Clearly, GoTriangle would prefer to see the budget provision removed. In the meantime, if there is a bill with technical corrections to the budget, we’ve recommended that the provision be changed to clearly state that no state funds will be spent before federal funds are granted, still allowing the light-rail project to be scored and to have state funding programmed before federal funding is committed.
Read more about the federal new start program: transit.dot.gov/regulations-and-guidance/fta-circulars/full-funding-grant-agreements-guidance.