LOS ANGELES (CNS) — The Los Angeles County Metropolitan Transportation Authority's Board of Directors Thursday took the first step toward receiving nearly $1.5 billion in Los Angeles County transit grants through the federal American Rescue Plan.

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.

What You Need To Know

  • The LA County Metropolitan Transportation Authority's Board of Directors Thursday took the first step toward receiving nearly $1.5 billion in Los Angeles County transit grants through the federal American Rescue Plan

  • The allocation 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

  • Metro Board of Directors Chair Hilda Solis said 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."

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

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 2020 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 and Metro Board of Directors Chair Hilda Solis.

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 dollars would allow the agency to return to pre-pandemic levels by September. The agency initially anticipated service to return to regular levels by September 2022. According to Michelle Navarro of Metro's Office of Management and Budget, Metro must disburse the funds by Sept. 30, 2029.

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

Los Angeles Councilman and Metro Board Director 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.

He 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.

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Devon Deming, the interim deputy executive officer for the Fareless System Initiative, said a proposed cost-sharing 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 for 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."

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.