Cities located in the Austin urbanized area but outside Capital Metro's service area—such as Cedar Park, Round Rock, Georgetown, Lakeway, Buda and Kyle—will now be able to access federal transit dollars designated for transit services in the region. The Capital Area Metropolitan Planning Organization approved five options Sept. 8 that allow such cities to create agreements with Capital Metro or the Federal Transit Administration to receive the funding. Capital Metro's board of directors approved the options in April. Capital Metro is the designated local recipient for what is called 5307 funds from the FTA. These funds are part of the FTA's Urbanized Area Formula Program that uses the population of an urbanized area, or UZA—which is designated by the U.S. Census—to calculate the UZA's allocation of 5307 funds. Changes to the Austin UZA in 2010 led to a gap between the UZA and Capital Metro's service area. Populations for jurisdictions outside the Capital Metro service area count toward the Austin UZA's funding allocation, but those jurisdictions did not have a formal way to access funding. "We wanted to avoid fragmentation of the urbanized area," said Todd Hemingson, Capital Metro's vice president for strategic planning and development. Three jurisdictions—Round Rock, Georgetown and Kyle—already have agreements with Capital Metro to use the 5307 funds. Hemingson said the new transit service options will formalize those existing agreements and allow other cities to access their allocated funding. Cities with existing Capital Metro agreements will continue to receive funding as long as those jurisdictions meet requirements, he said. The five options municipalities have to access 5307 funding are: Become a Capital Metro member, which requires allocating 1 cent of the jurisdiction's sales tax to the transit agency. This is what Leander did to receive MetroRail service. Hemingson said this is the least likely option for jurisdictions because most already have their sales taxes allocated. Create a service contract. Both Georgetown and Kyle have service contracts with Capital Metro for transit services. Create a local government corporation. Hemingson said this is a new funding mechanism created by the Texas Legislature that allows multiple jurisdictions to pool funding together and combine forces for service. It has not yet been used in the state. Become a subrecipient for FTA funds. Capital Metro would pass on the funding, and the jurisdiction would contract services for itself. Become a direct recipient for FTA funds. Round Rock chose this option and works directly with the FTA to manage funds and comply with requirements. "Jurisdictions should be serious," Hemingson said. "None of these come without strings or a requirement for a local match. We want to make sure [funds] are put to good use." Under the new options, jurisdictions will need to submit applications to Capital Metro for transit service and create a three-year transit development plan that describes the services or planning efforts, how money would be spent and the support for the jurisdiction's local match, Hemingson said. In most cases, jurisdictions would be required to fund 20 percent of a project. Cedar Park Mayor Matt Powell, who sits on CAMPO's policy board, said CAMPO's approval of these options is a step in the right direction. "This is a much bigger discussion on this topic than what we've ever seen. We're really gratified about that, and I'm appreciative of Capital Metro wanting to address this," he said. Powell said city of Cedar Park staff analyzed the options available to them and likely would not pursue the direct recipient option. "Our initial review showed that it would actually cost us more money in staff time and administration than money we would be receiving," he said. The city generates about $280,000 in 5307 funding for the Austin UZA, and Powell said being a subrecipient for FTA funding might be a more palatable option to access its funding. "There's just that feeling that we're generating over a quarter of a million dollars in funding a year and have been administratively blocked and not touched a dime even though there's about six things it could be spent on," he said. "The idea of becoming a sub- recipient much more piqued our interest. What we would spend this on I have no idea. That's a discussion our city leadership would have."