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(1) CHAPTER
ANALYSIS.—The analysis for 
chapter 53 is amended by striking the item relating 
to section 5309 and inserting the following:
‘5309. Capital investment grants.’.
(2) SECTION 5328.—Section 5328(a) is amend-
ed—
(A) in paragraph (2) by striking ‘5309(e)’ 
and inserting ‘5309(c)’; and 
(B) in paragraph (4) by striking ‘under 
section 5309(o)(1)’ and inserting ‘under section 
5309(i)(1)’. 
SEC. 3011. FORMULA GRANTS FOR SPECIAL NEEDS OF EL-
DERLY INDIVIDUALS AND INDIVIDUALS WITH 
DISABILITIES. 
(a) IN GENERAL.—Section 5310 is amended—
(1) by striking the section heading and insert-
ing the following: 
‘§ 5310. Formula grants for special needs of elderly 
individuals and individuals with disabil-
ities’; 
(2) by striking subsections (a) through (g) and 
inserting the following: 
‘(a) GENERAL AUTHORITY.—
‘(1) GRANTS.—The Secretary may make grants 
to States and local governmental authorities under 
this 
section 
for 
public 
transportation 
capital
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projects, and operating costs associated with public 
transportation capital projects, planned, designed, 
and carried out to meet the special needs of elderly 
individuals and individuals with disabilities. 
‘(2) SUBRECIPIENTS.—A State that receives a 
grant under this section may allocate the amounts of 
the grant to—
‘(A) a private nonprofit organization if the 
public transportation service provided under 
paragraph (1) is unavailable, insufficient, or in-
appropriate; or 
‘(B) a governmental authority that—
‘(i) is approved by the State to coordi-
nate services for elderly individuals and in-
dividuals with disabilities; or 
‘(ii) certifies that there are not any 
nonprofit organizations readily available in 
the area to provide the services described 
under paragraph (1). 
‘(3) 
ACQUIRING
PUBLIC
TRANSPORTATION 
SERVICES.—A public transportation capital project 
under this section may include acquisition of public 
transportation services as an eligible capital expense. 
‘(4) ADMINISTRATIVE EXPENSES.—A State or 
local governmental authority may use not more than
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10 percent of the amounts apportioned to the State 
under this section to administer, plan, and provide 
technical assistance for a project funded under this 
section. 
‘(b) APPORTIONMENT AND TRANSFERS.—
‘(1) APPORTIONMENT.—
‘(A) FORMULA.—The Secretary shall ap-
portion amounts made available to carry out 
this section under a formula the Secretary ad-
ministers that considers the number of elderly 
individuals and individuals with disabilities in 
each State. 
‘(B) LOW DENSITY ADJUSTMENT.—In ad-
ministering the apportionment formula under 
subparagraph (A)—
‘(i) in the case of a State with a popu-
lation density of 10 or fewer persons per 
square mile, the Secretary shall multiply 
by a factor of 2 the number of elderly indi-
viduals and individuals with disabilities in 
the State (as determined using the most 
recent decennial United States Census); 
and 
‘(ii) in the case of a State with a pop-
ulation density of more than 10 but equal
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to or fewer than 30 persons per square 
mile, the Secretary shall multiply by a fac-
tor of 1.25 the number of elderly individ-
uals and individuals with disabilities in the 
State (as determined using the most recent 
decennial United States Census). 
‘(2) TRANSFERS.—Any State’s apportionment 
remaining available for obligation at the beginning 
of the 90-day period before the end of the period of 
availability of the apportionment is available to the 
State for transfer to supplement amounts appor-
tioned to the State under section 5311(c) or 
5336(a)(1), or both. Any funds transferred pursuant 
to this paragraph shall be made available only for el-
igible projects as described in this section. 
‘(c) GOVERNMENT’S SHARE OF COSTS.—
‘(1) CAPITAL PROJECTS.—A grant for a capital 
project under this section shall be for 80 percent of 
the net capital costs of the project, as determined by 
the Secretary; except that in the case of a State de-
scribed in section 120(b)(1) of title 23, such percent-
age shall be increased in accordance with such sec-
tion. 
‘(2) OPERATING ASSISTANCE.—A grant made 
under this section for operating assistance may not
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exceed 50 percent of the net operating costs of the 
project, as determined by the Secretary. 
‘(3) REMAINDER.—The remainder of the net 
project costs—
‘(A) may be provided from an undistrib-
uted cash surplus, a replacement or deprecia-
tion cash fund or reserve, a service agreement 
with a State or local social service agency or a 
private social service organization, or new cap-
ital; and 
‘(B) may be derived from amounts appro-
priated to or made available to a department or 
agency of the Government (other than the De-
partment of Transportation) that are eligible to 
be expended for transportation. 
‘(4) USE OF CERTAIN FUNDS.—For purposes of 
paragraph (3)(B), the prohibitions on the use of 
funds for matching requirements under section 
403(a)(5)(C)(vii) of the Social Security Act (42 
U.S.C. 603(a)(5)(C)(vii)) shall not apply to Federal 
or State funds to be used for transportation pur-
poses. 
‘(d) GRANT REQUIREMENTS.—
‘(1) IN GENERAL.—A grant under this section 
shall be subject to all requirements of a grant under
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section 5307. A grant to a subrecipient under this 
section shall be subject to such requirements to the 
extent the Secretary considers appropriate. 
‘(2) COORDINATION
WITH
NONPROFIT
PRO-
VIDERS.—A recipient that transfers funds to an ap-
portionment under section 5336(a)(1) pursuant to 
subsection (b)(2) shall certify that the project for 
which the funds are requested under this section has 
been coordinated with nonprofit providers of serv-
ices. 
‘(3) PROJECT SELECTION AND PLANNING.—A 
recipient of funds under this section shall certify 
that—
‘(A) the projects selected were derived 
from a locally developed, coordinated public 
transit-human services transportation plan; and 
‘(B) the plan was developed through a 
process that included representatives of public, 
private, and nonprofit transportation and 
human services providers and participation by 
the public. 
‘(4) FAIR AND EQUITABLE DISTRIBUTION.—A 
recipient of a grant under this section shall certify 
that allocations of the grant to subrecipients are dis-
tributed on a fair and equitable basis.
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‘(e) STATE PROGRAM.—
‘(1) IN GENERAL.—Amounts made available to 
carry out this section may be used for transportation 
projects to assist in providing transportation services 
for elderly individuals and individuals with disabil-
ities that are included in a State program of 
projects. 
‘(2) SUBMISSION AND APPROVAL.—A program 
shall be submitted annually to the Secretary for ap-
proval and shall contain an assurance that the pro-
gram provides for maximum feasible coordination of 
transportation services assisted under this section 
with transportation services assisted by other Gov-
ernment sources. 
‘(f) LEASING VEHICLES.—Vehicles acquired under 
this section may be leased to local governmental authori-
ties to improve transportation services designed to meet 
the special needs of elderly individuals and individuals 
with disabilities.’; and 
(3) by redesignating subsections (h) through (j) 
as subsections (g) through (i), respectively. 
(b) CONFORMING AMENDMENT.—The analysis for 
chapter 53 is amended by striking the item relating to 
section 5310 and inserting the following:
‘5310. Formula grants for special needs of elderly individuals and individuals 
with disabilities.’.
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SEC. 3012. FORMULA GRANTS FOR OTHER THAN URBAN-
IZED AREAS. 
(a) DEFINITIONS.—Section 5311(a) is amended to 
read as follows: 
‘(a) DEFINITIONS.—In this section, the following 
definitions apply: 
‘(1) RECIPIENT.—The term ‘‘recipient’’ means 
a State that receives a Federal transit program 
grant directly from the Government. 
‘(2) SUBRECIPIENT.—The term ‘‘subrecipient’’ 
means a State or local governmental authority, non-
profit organization, or operator of public transpor-
tation services that receives a Federal transit pro-
gram grant indirectly through a recipient.’. 
(b) GENERAL
AUTHORITY.—Section 5311(b) is 
amended to read as follows: 
‘(b) GENERAL AUTHORITY.—
‘(1) GRANTS.—Except as provided in paragraph 
(2), the Secretary may make grants to other than 
urbanized areas under this section for the following: 
‘(A) Public transportation capital projects. 
‘(B) Operating costs of equipment and fa-
cilities for use in public transportation. 
‘(C) Acquisition of public transportation 
services, including service agreements with pri-
vate providers of public transportation services.
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‘(2) STATE PROGRAM.—
‘(A) IN GENERAL.—Amounts made avail-
able to carry out this section shall be used for 
projects included in a State program for public 
transportation projects, including service agree-
ments with private providers of public transpor-
tation. 
‘(B) SUBMISSION.—The program shall be 
submitted annually to the Secretary for ap-
proval. 
‘(C) APPROVAL.—The Secretary may ap-
prove the program only if the Secretary finds 
that the program provides a fair distribution of 
amounts in the State, including Indian reserva-
tions, and the maximum feasible coordination of 
public transportation service assisted under this 
section with transportation service assisted by 
other Federal sources. 
‘(3) RURAL TRANSPORTATION ASSISTANCE PRO-
GRAM.—
‘(A) IN
GENERAL.—The Secretary shall 
carry out a rural transportation assistance pro-
gram in other than urbanized areas. 
‘(B) GRANTS
AND
CONTRACTS.—In car-
rying out this paragraph, the Secretary may use
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not more than 2 percent of the amount made 
available to carry out this section to make 
grants and contracts for transportation re-
search, technical assistance, training, and re-
lated support services in other than urbanized 
areas. 
‘(C) PROJECTS OF A NATIONAL SCOPE.—
Not more than 15 percent of the amounts avail-
able under subparagraph (B) may be used by 
the Secretary to carry out projects of a national 
scope, with the remaining balance provided to 
the States.’. 
(c) APPORTIONMENTS.—Section 5311(c) is amended 
to read as follows: 
‘(c) APPORTIONMENTS.—
‘(1) IN GENERAL.—The Secretary shall appor-
tion amounts made available to carry out this sec-
tion among the States in the ratio that—
‘(A) the population of other than urbanized 
areas in each State, as shown by the most re-
cent Government decennial census of popu-
lation; bears to 
‘(B) the population of all other than ur-
banized areas in the United States, as shown by 
that census.