To our Oregon transit partners, 

I want to share an update on Oregon federal transit funding with you to help inform your budgetary plans and decisions. As we shared in August 2024, ODOT’s Public Transportation Division (PTD) is working through a backlog of federal grants from past years, which has led to longer processing times for obligating federal grants and making the grants available to providers.  

We have dedicated additional staff resources, filled vacancies and begun implementing process improvements and recommendations from external consultants (see December 2024 report to our Commission here). Our team is working closely with the Federal Transit Administration (FTA) to prioritize our grant applications. We are processing more than twice the expected volume of federal grants per year. While we are making progress, there will be delays for the foreseeable future.   

Our top priority is to obligate and distribute the federal transit grants, process contracts and identify timelines for federal funding. Our division has completed contracts for the 2024-2026 Mid-Cycle discretionary grant awards and is processing the 5310 and 5311 federal formula grant applications for 2025-2027 now. We are assessing how quickly we can work with FTA to contract and obligate available federal funds given the backlog of grants we are working on.  

As we noted in August, PTD awards federal transit funding and makes payments to subrecipients on a reimbursement basis. PTD authorizes payment for eligible subrecipient expenses after the federal grant has been fully executed by PTD and the FTA and those funds are available for drawdown. This is consistent with ODOT policy, and it’s a change from previous solicitations.  

We made this change to ensure that our federal funding reimbursement process is sustainable. We submit grant applications to FTA once the solicitation process is complete and award amounts are determined. Our policy is to provide funding once FTA grants are executed and federal funding is available, except as approved by the Division Administrator. However, over a number of years, it was our practice to reimburse agencies for eligible expenses before FTA grants were executed. This practice was possible because we had funding on hand to provide this interim funding. Because of a delay in processing FTA grants, the amount of federal awards has outgrown the funding we have on hand to cover reimbursements.  

 We understand that delays in reimbursements and funding availability have real impacts on transit operations. We want to minimize impacts on service and are assessing what impacts a delay on federal grant timing could have on transit operations and what solutions are available. In the 5310 and 5311 federal funding applications for 2025-2027, we included specific questions about your agency’s financial needs, current reserve levels and risks you might face in delivering service if funding is delayed.  

Please be in touch with your Regional Transit Coordinator if your November formula application reimbursement and hardship information needs to be updated. Specifically, we want to know whether your agency does not have funding that could cover these expenses (e.g., reserves, STIF Formula funds, agency and local funds), and why state-funded reimbursement may be required prior to mid-2026 to sustain existing service and/or avoid other significant hardships, as described in our August guidance and application. We want to understand your specific needs so we can identify solutions to keep services up and running. 

Additionally, ODOT is continuing to assess the impact recent federal actions will have on Oregonians. We will provide updates as possible. ODOT will continue to work in partnership with FTA on federal transit funding programs as more federal information becomes available.  

We know that uncertainty with the timing of funding is difficult and presents real risks to service capacity. Oregon transit providers are getting people to critical services every day and I understand how these types of delays have real world impacts. We will provide updates to formula funding and contracting timelines as they become available.  

Thank you for your partnership and service to your communities. 

-Suzanne Carlson 
Public Transportation Division Administrator