The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 significantly changed the system for providing assistance to low- income families with children by replacing the existing entitlement program with fixed block grants to states to provide Temporary Assistance for Needy Families (TANF). TANF provides about $16.5 billion annually to states to help families become self-sufficient, imposes work requirements for adults, and limits the time individuals can receive federal assistance. However, accessing entry-level jobs to meet TANF work requirements can be challenging for low-income individuals, many of whom do not ow n cars or have poorly maintained cars that are not equipped to drive long distances. As we reported in 2004, many rural TANF recipients cannot afford to own and operate a reliable vehicle and public transportation to and from employment-related services and work is often not available. Existing public transportation systems cannot always bridge the gap between the location of individuals’ homes and jobs for which they not to mention child care and other domestic responsibilities and employment-related services. These systems were originally established to allow urban residents to travel within cities and bring suburban residents to central-city work locations. According to 2007 U.S. Census Bureau data, a higher proportion of people in metropolitan areas who are below poverty level live in cities in those areas than in the corresponding suburbs. Furthermore, employees at many entry-level jobs must work shifts in the evenings or on we ekends, when public transit services are either unavailable or limited. As a result, Congress created the JARC program in the Transportation Equity Act for the 21st Century (TEA-21) to support the nation’s welfare- reform goals. The purpose of the program was to improve the mobility of low-income individuals by awarding grants that states and localities cou use to provide additional or expanded transportation services and thus provide more opportunities for individuals to get to work. JARC funds ld were awarded to grantees designated for project funding in the conference reports that accompanied appropriations acts. TEA-21 also required GAO to review the JARC program every 6 months. In a series of reports from December 1998 to August 2004, GAO found, among other things, that JARC had increased coordination among transit and human service agencies, but that FTA was slow in evaluating the program. These reports included recommendations to assist FTA in improving its evaluation process. In response to these recommendations, FTA developed specific objectives, performance criteria, goals, and performance measures for the JARC program, although GAO noted limitations in the performance measures and recognized that FTA planned to continue to develop more comprehensive and relevant performance measures. SAFETEA-LU made several changes to the JARC program that affected recipients. Most notably, SAFETEA-LU created a formula to distribute funds beginning with fiscal year 2006: SAFETEA-LU requires that 40 percent of JARC funds each year be apportioned among states for projects in small urbanized and rural areas—those with populations of 50,000 to 199,999 and less than 50,000, respectively. It also required that the remaining 60 percent be apportioned among large urbanized areas—those with populations of 200,000 or more. As a result, rural and small urbanized areas were each apportioned a total of $27.3 million in fiscal year 2006, while large urbanized areas were apportioned a total of $82 million (see table 1). The change to a formula grant program significantly altered the allocation of JARC funds because some states and large urbanized areas that did not formerly receive funds now receive them, and others receive different amounts than they received in the past. For example, total funds available in Florida and Virginia increased by more than 1,200 percent from fiscal years 2005 to 2006 (from $594,708 to $8.3 million and from $84,249 to $2.5 million, respectively). Similarly, the funds available for the large urbanized area of Tampa/St. Petersburg increased 64 percent from 2005 to 2006 (from $594,708 to $978,029). However, the total funds available to Alaska and Vermont decreased by more than 80 percent (from $1.7 million to $207,503 and from $991,182 to $186,885, respectively), and the funds available to the Birmingham, Alabama, area decreased 88 percent from 2005 to 2006 (from $3 million to $356,107). In addition, 18 states were apportioned JARC funds for fiscal year 2006 that did not receive funds in fiscal year 2005. Recipients have up to 3 years in which to apply for funds for each fiscal year. For example, recipients could apply for fiscal year 2006 funds until September 30, 2008. Any funds not applied for by then lapsed and would have been reapportioned among all recipients for fiscal year 2009. Similarly, fiscal year 2007 funds are available until September 30, 2009 and fiscal year 2008 funds will be available until September 30, 2010. The amount of available JARC funds is relatively small compared to FTA’s primary grant programs. For example, FTA’s Urbanized Area Formula Grant program (Section 5307), which provides transit funding for large and small urbanized areas, was apportioned $3.9 billion for fiscal year 2008, while FTA’s Rural Area Formula Grant program (Section 5311) was apportioned about $416 million in fiscal year 2008. In contrast, the total amount of JARC funds available for the 3 fiscal years 2006 through 2008 is $436.6 million. SAFETEA-LU also requires JARC recipients to fulfill specific requirements and follow specific processes (see fig. 1): SAFETEA-LU required that a recipient be designated to award JARC funds. This recipient is responsible for distributing funds to other agencies. The governor of each state designated a recipient—almost always the state department of transportation—for JARC funds at the state level for small urbanized and rural areas. For large urbanized areas, the governor, local officials, and public transportation operators selected designated recipients, often a major transit agency or metropolitan planning organization (MPO). SAFETEA-LU required that designated recipients certify that JARC projects are derived from locally developed coordinated public transit-human services transportation plans. The coordinated planning process must include representatives of public, private, and nonprofit transportation and human services providers and participation by the general public. In general, among the states we contacted, either the designated recipient or MPO has taken the lead in developing coordinated plans in large urbanized areas. For small urbanized and rural areas, some designated recipients at the state level have generally delegated responsibility to develop plans to agencies at the local level, while in others the designated recipients have taken the lead. Local officials must ensure that appropriate transportation and human services providers participate in the process. Under SAFETEA-LU, designated recipients at the state level must develop a solicitation process for small urbanized and rural areas to apply for funds. States must use a competitive selection process to select projects for these areas. Large urbanized areas must also develop and conduct a competitive selection process for their projects. After projects are selected, states and large urbanized areas must apply to FTA to fund the projects and certify that selected projects were derived from a locally developed, coordinated public transit-human services transportation plan. SAFETEA-LU allows states and large urbanized areas to use 10 percent of JARC funds for administrative activities, including planning and coordination activities. Under TEA-21, the use of JARC funds for planning and coordination activities was prohibited. To ensure designated recipients fulfill their stewardship roles, FTA requires designated recipients to submit a management plan describing how they plan to administer the JARC program. Designated recipients for large urbanized areas submit program management plans, while state agencies that are designated recipients for small urbanized and rural areas submit state management plans. States have submitted management plans in the past for other transit programs. FTA allows states to amend existing management plans to include the JARC program. SAFETEA-LU increased the federal government’s share of capital costs to no more than 80 percent. Under TEA-21, the federal match for capital projects was 50 percent, which was inconsistent with the federal share for capital projects in other FTA programs. As under TEA-21, JARC recipients must identify and raise 50 percent of the funds for operating projects. Matching funds may come from other federal programs that are not administered by DOT, such as TANF block grants, as well as from non-cash sources, such as in-kind contributions, employer contributions, and volunteer services. SAFETEA-LU also requires that two other FTA programs that provide funding for transportation-disadvantaged populations certify that projects be derived from a locally developed coordinated human services transportation plan. One of these, the New Freedom program, was created by SAFETEA-LU to support new public transportation services and public transportation alternatives beyond those required by the Americans with Disabilities Act. According to FTA, the program is intended to fill gaps between human service and public transportation services and to facilitate integrating individuals with disabilities into the workforce as well as full participation in the community. The program provides alternatives to assist individuals with disabilities with transportation, including transportation to and from jobs and employment support services. The second program, the Elderly Individuals and Individuals with Disabilities program (commonly referred to as the Section 5310 program), has existed since 1975. The Section 5310 program originally provided formula funding for capital projects to help meet the transportation needs of elderly individuals and persons with disabilities. However, in 1991, Congress expanded the Section 5310 program to allow funds to be used to acquire services to promote the use of private-sector providers and to coordinate with other human service agencies and public transit providers. These purchases are also considered to be capital expenses.