State and Federal Funding: How do our transportation projects get funded?

State and Federal funding for transportation is incredibly complicated – perhaps needlessly so – so let’s break it down to the big picture. Just a fair warning, there are acronyms ahead!

The largest funding sources, like California’s SB1 excise and sales taxes on gas, and the Federal Highway bill, generally flow through programs and decisions of the California Transportation Commission (CTC).

When you hear about the Federal infrastructure bill in the news, this is the Federal part of this source. The $500 Billion “Infrastructure Investment and Jobs Act” was approved on November 15 and the $1.75 Trillion “Build Back Better” Act is currently being considered by Congress.

Both State and Federal sources have lots and lots of set asides for specific programs, like roads, bridges, pavement rehabilitation, bicycle and pedestrian programs, air quality improvements, goods movement, rail, transit, and more. All of these have their own requirements for eligibility. A portion of these transportation funds are distributed by a formula to Caltrans and the counties, cities and towns; these funds are typically used by local governments for road maintenance and smaller safety or congestion improvements. Most of the remaining funds are in competitive grant programs, which tend to fund larger, more transformative projects and also require a sizeable contribution of local funding, called “matching funds”.

It is PCTPA, made up of a elected leaders from the County, each City, each Town, and a public member at large, that determines Placer County’s priority projects for the state transportation funds by adopting its Regional Transportation Plan (RTP) which looks out 40 years into at future transportation needs. Then it develops a Regional Transportation Improvement Plan (RTIP), which is a budget of projects in the funding pipeline and is usually done towards the end of odd numbered years. PCTPA works with the cities and the county within the Placer region and will also host community workshops to get the thoughts of the residents.

Caltrans’ version of the RTIP is called an Interregional Transportation Improvement Program, or ITIP. The RTIPs from all the regions, along with Caltrans’ ITIP, are conglomerated into a single document called the State Transportation Improvement Program (STIP), which is adopted by the CTC, usually in the Spring of even numbered years. The funding distributed in the STIP is based on a five-year revenue estimate.
Therein lies the challenge for PCTPA, as those projects most popular with the CTC are large transformative projects that require matching funds PCTPA does not have. The CTC also favors projects that will help achieve state goals for reducing greenhouse gas emissions, improving goods movement, and so on, which are not always the highest priority projects for PCTPA’s member jurisdictions such as maintenance or congestion relief. We always want to try and get as much funding as we can, so we strategize our project list in a way that the CTC will find most compelling.
Being strategic with our project proposals is something that PCTPA is very adept at. We are constantly working with the federal government, CTC, Caltrans, our member jurisdictions, and other key

stakeholders to find ways to give our top priorities like the 80/65 Interchange, Widening Highway 65, city/town roadway expansion projects, transit and bicycle/pedestrian projects the best competitive edge we can.