**FREQUENTLY ASKED QUESTIONS**

**Urbanized Area Formula Grant Provisions of SAFETEA‑LU**

**1. In the SAFETEA-LU estimates posted on FTA's website, the Section
5307 and Section 5340 apportionments appear to have been combined. Is
this correct? If so, why was this done?**

Yes, the Section 5307 and Section 5340 apportionments have been
combined. The "Urbanized Areas (5307 and 5340)" column in the SAFETEA-LU
tables posted on the FTA website includes: regular 5307 funds (i.e.,
funds available after a required one percent takedown for Small Transit
Intensive Cities), funds for Small Transit Intensive Cities, and Growing
States and High Density States funding for the area. FTA merged these
into a single apportionment amount to comply with language in the
SAFETEA-LU Conference Report, which asks FTA to publish a single
urbanized apportionment for these programs.

**2. How is the Section 5340 funding distributed within an urbanized
area?**

Separate formulas are used to apportion Section 5307 and Section 5340
funds to urbanized areas. Under the 5340 formula, half of the funds are
made available under the Growing States factors and are apportioned
based on State population forecasts for 15 years beyond the most recent
Census. Amounts apportioned for each State are then allocated to
urbanized and rural areas based on the State's urban/rural population
ratio. The High Density States factors distribute the other half of the
funds to States with population densities greater than 370 people per
square mile. These funds are apportioned only to urbanized areas within
those States.

The SAFETEA-LU Conference Report instructs FTA to merge the urbanized
area amounts for the 5307 and 5340 formulas into a single apportionment
when it publishes program apportionments.

The distribution or sub-allocation of Sections 5307 and 5340 funds
within an urbanized area is a local responsibility. In those urbanized
areas with more than one grantee or designated recipient, FTA expects
local officials, operating through the Metropolitan Planning
Organization (MPO) and the designated recipient, to determine the
sub-allocation together. The sub-allocation should be determined fairly
and rationally through a process agreeable to recipients.

**3. Can Growing State and High Density States funds be used to support
operating activities?**

Yes, but only in an urbanized area (or, in some cases, a portion of the
urbanized area) that qualifies under current law. For Section 5307 this
includes:

-   an urbanized area of less than 200,000 in population;

-   an urbanized area that crossed the 200,000 threshold in the 2000
    Census;

-   a transit provider or grantee in urbanized areas of at least 200,000
    in population that meets the exception noted in section
    5307(b)(1)(E) or 5307(b)(1)(F) of SAFETEA-LU, or section 3027(c)(3),
    as amended, of TEA-21.

Growing States funds may also be used for operating assistance in
non-urbanized areas.

In some instances SAFETEA-LU imposes a limit on how much of an urbanized
area's apportionment may be used for operating assistance.

**4. Will the flexibility to use Section 5307 funds for operating
assistance be continued under SAFETEA-LU for those urbanized areas that
crossed over the 200,000 population threshold for the first time in the
2000 Census?**

Yes, but within limits. Those areas will be permitted to use FY 2006 and
FY 2007 funds for operating assistance. However, the allowable amount
will be phased down to a maximum of 50 percent and 25 percent of the
amount available to any eligible urbanized areas in FY 2002 for FY 2006
and FY 2007, respectively.

**5. Does SAFETEA-LU continue the one percent set-aside for transit
enhancements required in TEA-21?**

Yes and No. More details related to the answer to this question and
other questions and answers specific to the SAFEETEA-LU transit
enhancement requirement are available. Please see the "Transit
Enhancements" heading or link in the Frequently Asked Questions section.

**6. What urbanized area does 5307(b)(1)(E) refer to?**

Evansville, IN-KY

**7. We have a city that exceeded the 50,000 population barrier one year
after the 2000 Census. How can we go about getting it designated a small
urban area *before* the 2010 Census?**

SAFETEA-LU defines an "urbanized area" as one that encompasses a
population of not less than 50,000 people and that has been designated
in the most recent decennial Census as an "urbanized area" by the
Secretary of Commerce.

To be reclassified as urbanized prior to the 2010 Census, the area in
question may request that the Census Bureau undertake a special census.
If as a result the Census Bureau identifies the area as an urbanized
area, then FTA may include that area in future apportionments for the
section 5307 Urbanized Area formula funds. The area will need to
communicate directly with the Census Bureau to determine the process,
requirements, and cost to conduct a special census.