2026-20179NoticeWallet

FTA Proposes Faster Rules for Big Transit Project Funding

Published Date: 10/1/2026

Notice

Summary

The Federal Transit Administration is updating the rules for its Capital Investment Grants program, which helps fund big public transit projects. These changes aim to make the process faster, clearer, and hold project sponsors more accountable. If you’re involved in transit projects, get ready—comments are open until November 16, 2026, and the new rules will apply right away with no exceptions.

Analyzed Economic Effects

15 provisions identified: 3 benefits, 6 costs, 6 mixed.

Higher Local Funding Required Before Engineering

For New Starts and Core Capacity projects, sponsors must obtain commitments of at least 50% of all non-CIG (local/non-Federal) funds prior to applying for entry into the Engineering phase. This raises the prior requirement from 30% to 50% for those project types; Small Starts already require 50% but on a three-year timeline.

Formal Method to Calculate Federal CIG Share

FTA will adopt a formal methodology to calculate and lock in a project's Federal CIG percentage share at entry into Engineering. All New Starts and Core Capacity projects with an overall rating of 'Medium' or higher start at a 40% CIG share, with upward or downward adjustments tied to ratings on six Project Justification criteria (e.g., cost-effectiveness). The calculated share is capped at the statutory maximum and is locked at Engineering.

Demographic Boosts Can Increase CIG Share

FTA proposes additional boosts to a project's CIG percentage share based on corridor birth and marriage rates: +5 percentage points if the corridor birth (or marriage) rate is more than 1% above the national average; +3 points if equal to or up to 1% higher; +1 point if within 1% below the national average. Birth and marriage boosts can add up to 10 percentage points total.

Final Guidance Will Apply Immediately

FTA says the final Capital Investment Grants (CIG) Policy Guidance will be effective immediately when published on the FTA website and there will be no grandfathering for projects already in the CIG pipeline. Comments on the proposed guidance must be received by November 16, 2026.

New Early Project Development Deadlines

Within three months of entering Project Development, sponsors must submit FTA's documented NEPA class of action and a ridership data collection/on-board survey plan (required for New Starts and Core Capacity; encouraged for Small Starts). Within one year, sponsors must update project cost/scope/schedule, complete at least 15% design, and list needed third-party agreements with schedules.

Allow Non-CIG Federal Funds and Expanded Pre-Award Work

FTA will allow project sponsors to use non-CIG Federal funds (subject to their program rules) for pre-award authority activities (previously only local funds were allowed). FTA also proposes expanded full pre-award authority including construction under certain conditions for projects seeking a total Federal share of less than or equal to 25% and meeting project-justification thresholds. Letters of No Prejudice (LONPs) would be limited to five years unless extended.

Annual Engineering Progress Updates Required

During the Engineering phase, project sponsors must submit an annual update to FTA Headquarters including refined scope, schedule, total cost estimates, status of non-CIG funding commitments, and critical third-party agreements. If sufficient progress is not demonstrated annually, FTA may remove the project from the CIG program; sponsors may reapply after addressing deficiencies.

Unified Cost-Effectiveness Metric and Breakpoints

FTA will standardize the cost-effectiveness metric for New Starts, Core Capacity, and Small Starts to 'annual capital and operating & maintenance (O&M) cost per linked transit trip.' New unified breakpoints would apply: High < $8.00 per trip; Medium-High $8.00–$9.99; Medium $10.00–$12.99; Medium-Low $13.00–$19.99; Low > $20.00.

Enrichments Narrowed, Safety Added, Applicability Expanded

FTA proposes to remove current enrichments except Joint Development, add transit safety and security as a new enrichment category, and allow enrichments to be used by New Starts, Small Starts, and Core Capacity projects. Previously some enrichments applied only to New Starts.

Warrants Expanded to All Project Types

FTA proposes to allow Project Justification warrants (pre-qualification that yields automatic Medium ratings on certain criteria) to be available to New Starts, Small Starts, and Core Capacity projects if they meet defined cost and ridership thresholds. Projects with total capital cost of $600 million or higher would continue to be ineligible for warrants.

Must Start NEPA Before Project Development Entry

Project sponsors will be required to include documentation showing they initiated the National Environmental Policy Act (NEPA) review before requesting entry into Project Development. NEPA initiation may include early scoping, environmental linkages, or formal NEPA initiation.

30-Day Deadline for Entry Request Completeness

When a sponsor requests entry into Project Development, they must provide all listed required information within 30 days of submitting the initial request. If the request is still incomplete after 30 days, FTA will no longer consider it and the sponsor must submit a new complete request.

No CEO Signature on TAM Progress Statement

FTA will no longer require a signed statement from the agency CEO (Accountable Executive) describing progress toward Transit Asset Management (TAM) performance targets. Sponsors still must provide an up-to-date TAM plan and narrative report from the National Transit Database.

Economic Development Subfactors Reweighted

FTA will change economic development weighting: supportive zoning and performance/impact of transit-supportive plans each increase to 40% of the economic development rating, while tools to maintain or increase affordable housing share in station areas drop to 20%.

Remove 'Access to Essential Services' Land Use Subfactor

FTA proposes to remove the 'access to essential services' subfactor from the land use criterion because the Department of Homeland Security's HIFLD data source was discontinued. The other four land use subfactors remain and will keep equal weighting at 25% each.

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Key Dates

Published Date
Comments Due
10/1/2026
11/16/2026

Department and Agencies

Department
Independent Agency
Agency
Transportation Department
Federal Transit Administration
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