Topic

MSB Transit

In December 2022, the U.S. Census designated a portion of the Core Area of the Matanuska-Susitna Borough (MSB) as an “urbanized area” or UZA. Alongwith the new designation comes a change in Federal Transit Administration (FTA) funding allocations. Non-profit transit and health and human service organizations operate transit in the borough and rely on FTA 5311 Rural Transit funding for operations. Within the UZA, 5311 funding is no longer allowed, and providers must instead use FTA 5307 (Urban Transit) funds. Unlike the 5311 Rural Transit funds, 5307 cannot be given directly to a non-profit organization. Instead, FTA and the State of Alaska Department of Transportation & Public Facilities (AKDOT&PF) have worked with the borough to assign a direct recipient to receive the funds. A direct recipient must be a local governmental organization that, in our case, will facilitate pass-through grant funding or will contract transit providers for services in the UZA.

Through this process, the MSB has been selected to be the direct recipient of the funding, authorized by the local Assembly Members and confirmed by the Governor. Funding allocated by the FTA will require a 50% match from the MSB for operation expenses and a 20% match for capital expenses. The Assembly Members approved the match amount of $750,000, and the Borough applied for $1,462,926 under the FTA 5307 funds, which were approved in December 2025. Mat-Su Borough has signed a contract with the service provider, Valley Transit, and the operations under the management of the Borough started on October 1st, 2025. The contract ends on June 30, 2026, but the Borough is preparing to reapply for FTA 5307 funds and secure funding through mid-2027.