Shared mobility in Greater Minnesota | Resources | Shared Mobility Public-Private Partnership Guide
5: Potential funding sources
Public transit services are vital to providing mobility and community connectivity. Rural public transit services connect users to health care, education and employment opportunities, and social and recreational activities. However, rural communities are limited in terms of the mobility assistance they can provide given high costs and limited availability of affordable and reliable transportation options.
Shared mobility is an innovative strategy to meet demand for public transit in rural and low-density areas, while also providing social and environmental benefits. MnDOT is currently exploring how public transit funding may be used to fund shared-mobility services as an extension of existing public transit services in small urban and rural areas in Minnesota. A recent report, Funding Shared Mobility as an Extension of Existing Public Transit Services, identifies funding available for this purpose, as well as federal and state regulations that limit use of such funding sources. In addition, this report explores how transit agencies across the United States have funded similar projects and identifies opportunities for improvements in Minnesota.
Federal funding sources can often be used for capital, construction, and equipment but rarely for operational expenses. Capital eligible programs include Congestion Mitigation and Air Quality Improvement (CMAQ) funds, the Carbon Reduction Program, and Promoting Resilient Operations for Transformative, Efficient, and Cost-Saving Transportation (PROTECT) Program. Other funds can be used for operations expenses but may include some exceptions. For example, Federal Transit Administration 5307 and 5311 funds can be used for operational expenses for ride share and taxi services in lieu of traditional transit but can only be used for capital and construction but not vehicles for car and bike share. See the report for more details.
When pursuing funding, it is important to note that most programs require local matching funds, usually between 20-50% of the total project cost, depending on the fund. Communities will need to identify local funding, which can come from general funds, licensing fees, state grants, or philanthropic grants.