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U.S. Department of Transportation U.S. Department of Transportation Icon United States Department of Transportation United States Department of Transportation

Flexible Funding for Transit and Highway Improvements

Federal law (23 U.S.C. § 104(f); 49 U.S.C. § 5334(i)(1)) allows Federal-Aid Highway Program funding made available for public transportation projects to be flexed (or transferred) to be administered by FTA for public transportation projects. 

See potentially eligible programs at Federal Programs that Support Public Transportation.

It is important to remember that the requirements of the metropolitan and statewide transportation planning processes must be met for flexibly funded projects.

Examples of Programs Eligible for Flex Funding 

Congestion Mitigation and Air Quality (CMAQ) program - The CMAQ program provides a flexible funding source to state and local governments for transportation projects and programs to help meet the requirements of the Clean Air Act.

Surface Transportation Block Grant (STBG) - The STBG program provides flexible funding to best address State and local transportation needs.

Tribal Transportation Program - The TTP supports safe and reliable transportation and public road access to and within Indian reservations, Indian lands, and Alaska Native Village communities.

Flexible Funding for Transit Access - The Federal Highway Administration (FHWA) and FTA are working together to promote safer routes to transit and help local policymakers better connect their communities through Complete Streets.

Flex Funding Resources

Flexible Funding Brochure: This brochure provides information on what flexible funding is and how it is used to support transit. It also provides links to cases studies and outlines the steps involved in flexing funds.

Flexible Funding Presentation: This presentation provides information on the benefits of flexible funding, types of eligible programs and projects, process flow chart, and contacts for additional information.

Interagency Transfers

Under the current transfer provisions in 23 USC §104(f), states may request the transfer of the Title 23 funds used for transit projects to FTA or have the Federal Highway Administration (FHWA) administer the funds under Title 23.

The following are important to keep in mind when considering interagency transfers:

  • Funds transferred from FHWA to FTA can be used only for purposes eligible under both the original program that the funds are transferred from and the program to which the funds are transferred.
  • Funds transferred from FHWA to FTA shall be administered under the requirements of Chapter 53 of Title 49 USC, except that the non-federal share for the original source of the funding applies to the transferred funds. 
  • To transfer funds from FHWA to FTA, a State Department of Transportation must request the transfer, with concurrence of the Metropolitan Planning Organization (MPO) if the project is within a metropolitan planning area, in a letter to the FHWA State Division Office.
  • Funding transfers are permitted only for projects contained in an approved metropolitan transportation improvement program (TIP) and/or statewide transportation improvement program (STIP).

If interested in transferring funds, please contact your FTA Regional Office for specific guidance.