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Metro Board Begins Process of Receiving Nearly $1.5 Billion Through the American Rescue Plan Act

Published on Monday, July 26, 2021 | 5:00 am

The Los Angeles County Metropolitan Transportation Authority’s Board of Directors took the first step last week toward receiving nearly $1.5 billion in transit grants through the federal American Rescue Plan Act.

Pasadena will receive $1.25 million from ARPA funding for Pasadena Transit and Dial-A-Ride services. The funding will help offset revenue losses sustained during the COVID-19 pandemic, as well as the increased operating costs involved with enhanced cleaning and other measures aimed at protecting transit drivers and the public.

The board voted to approve the allocation, which includes $1.465 billion for the Los Angeles-Long Beach-Anaheim Urbanized Area, $16 million for the Santa Clarita Urbanized Area, and $1.666 million for the Lancaster-Palmdale Urbanized Area.

The funds for the Los Angeles-Long Beach-Anaheim region will be divided among agencies by the Southern California Association of Governments, and are in addition to $1.068 billion in transit grants allocated to the county in March 2020 by the federal Coronavirus Aid, Relief and Economic Stimulus
(CARES) Act, and $911 million allocated in December through the Coronavirus Response and Relief Supplemental Appropriations Act.

“I’m really glad Metro is taking a first step towards receiving the funding, which is so incredibly important to us as we move forward as an organization,” said Los Angeles County Supervisor, who chairs both the Board of Supervisors and the Metro Board of Directors.

Solis said the funds would first be used to ensure the agency
continues “its baseline operations,” but added that any excess funding should be used to help “communities that have been most impacted by the pandemic, that means again the Black and Latinx communities.”

In March, Metro announced that the American Rescue Plan Act dollars would allow the transit agency to return to pre-pandemic levels by September. Metro initially anticipated service to return to regular levels by September 2022.

According to Michelle Navarro of Metro’s Office of Management and Budget, the agency must disburse the funds by Sept. 30, 2029.

The board will begin discussing how to spend the money at the
beginning of 2022, in time for the 2022-23 fiscal year budget, said Metro CEO Stephanie Wiggins.

Los Angeles Councilman and Metro Board member Mike Bonin voiced support Thursday for using funds for the agency’s Fareless System Initiative, a pilot program to waive fares for the county’s K-12 students, community college students, and all low-income people.

Bonin called the program “a huge equity issue for us” and “one of the biggest anti-poverty programs Los Angeles has done or can do. …I think it’s as big as the minimum wage increase we did a few years ago, and it’s absolutely necessary.”

The program is expected to cost Metro about $33.5 million in revenue loss during the pilot program, but Metro staff said American Rescue Plan funds would be able to cover it.

On May 28, the Board of Directors advanced plans for the pilot program but requested more details on the proposal’s finances before implementing it. A comprehensive plan will be introduced in September before the board’s final vote to begin the program, but on Thursday board members heard an update
on the plan.

Devon Deming, the interim deputy executive officer for the Fareless System Initiative, said a proposed cost-sharing program with school districts would include $3 per student per year paid by the districts for all of its students.

So far, 38 districts in the county have expressed interest in partnering on the program, representing 1,139 schools, 695,610 students and potentially generating more than $2 million, which she called “a small percentage of the total but it’s still a percentage.”

For community college partnerships, Metro proposes the colleges paying $7 per student per year for all students in the district. For phase one of the program, which includes only students, Metro expects fare revenue loss to reach about $33.5 million, and if municipal and local operators join the program, they are expected to lose about $16.4 million in fare revenue. The program would cost a total of about $50 million during the first year.

“Recognizing that there will be revenue loss as a result of [Fareless System Initiative] implementation, staff believes that with the receipt of [American Rescue Plan Act] funding, Metro will have sufficient funds to cover phase one of the pilot,” said Metro’s Korey Clarke.

“Because ARPA is a one-time funding source, a subsequent extension of the program will require a new and continuous source of funds,” Clarke said.

The board will receive a comprehensive funding plan in September before voting to implement the program.

“I do want to say I believe the change in the timeline will ensure we have a comprehensive, well-run program on day one,” said Solis. The program was initially expected to launch in August.

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