Dedicated Funding for Regional Transit
What is Dedicated Funding?
First and foremost, dedicated funding means providing a reliable source of annual revenues that provides support to transit operations and capital costs. It does not necessarily mean "new" or "increased" funding, but the expansion of existing transit service will necessitate new revenue.
Revenues, which can be implemented in a variety of ways, are established on the front-end, by a legislative body or by the voters, to be dedicated for transit without being subject to the same kind of discretion associated with general fund revenues. This approach reduces the annual burden placed on local governments to find funding for public transportation and minimizes the uncertainty for public transit customers, operators, and the business community looking to invest along fixed transit routes.
An Historic Milestone: 2009 Enabling Legislation
For more than two decades community leaders in the greater Nashville region have been talking about moving forward together to implement a better mass transit system for reasons related to personal convenience, economic growth and prosperity, and environmental sustainability. That talk has included the notion of coming together as a region to dedicated local or regional funding to mass transit.
On July 14, 2009, Tennessee Senate Bill 1471 ( House Bill 1263) was signed into law by Governor Phil Bredesen establishing the necessary legal framework that will provide the tools required to keep Tennessee's urban areas competitive with other region's of the nation.
What Does the Enabling Legislation Do?
- Allows for the creation or expansion of regional transportation authorities in Tennessee's large urban areas.
- RTAs will work cooperatively with local governments and existing transit agencies as determined by interlocal agreements – not supersede or supplant them.
- An opportunity to dedicate a regional revenue source from a menu of funding options, subject to voter approval or approval by local governing bodies, in order to expand transit services and to support existing and future state and federal Investments.
- Allows an RTA to receive dedicated funding through an act of the General Assembly. That act must follow a request from local legislative bodies or an advisory vote of the people.
- Provides the authority to issue bonds for faster response to travel demand and market-driven development opportunities.
- The request restricts the sovereign immunity of an RTA and requires the authority to comply with all local land development codes and regulations.
- The request does not include the establishment of any new taxes, nor does allow for an increase in the rates of existing taxes without the future consent of voters or local governing bodies;
- The request seeks to establish a framework for the pursuit of dedicated regional funding for transit and is distinct from other efforts pursuing increased state funding for transportation infrastructure.
Why is the Enabling Legislation Important?
- The effort represents broad support among public and private sector interests for moving forward with enabling legislation to support regional coordination in the planning, funding, and implementation of a regional mass transit plan. Mass transit is essential to the mobility, economic growth and prosperity, and environmental sustainability of growing metropolitan regions.
- Federal policy requires transit to have a stable, dedicated source of local/regional funding to be eligible for large capital grants.
- National and urban policy is shifting towards a significant emphasis on funding for mass transit. Competitor regions (Austin, Charlotte, Denver, etc.) are way out in front on this issue and are surpassing expectations for improving personal convenience regional economic returns.
