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Transit budget leans on state and federal grants; ridership recovering and cost-share change may boost returns
Summary
Quincy Trans Alliance officials said grant funding from IDOT and federal sources supports expansion projects and operations; ridership has rebounded since 2021 and a federal de minimis cost-share increase (10% to 15%) should raise funds returned to the general fund.
Quincy Trans Alliance staff told the council the transit budget relies heavily on state and federal grants to fund capital projects and operations and that ridership has rebounded since the COVID downturn.
The Alliance presented three capital grants: a rehabilitation and bus-wash project (under IDOT review and in pre-bid review), and two rounds of Illinois downstate funding to move a transfer point (from Seventh and Jersey to a parking lot south of Illinois School Supply). Staff said those two grants are being combined and are fully funded by the state with no city match required. Transit has also added a senior driver and expanded DNE (demand-not-everything) buses from five to six, which reduced denials for service from roughly 303 in an earlier quarter to 160 in the most recent quarter.
Transit revenue projections include more than $6.8 million from state IDOT funds and roughly $693,000 in federal funding the agency can draw down; staff said average annual state draws have been about $3 million. The draft budget shows an increase of about $336,000 in grant funding for the year. Staff said planned pay increases across divisions total roughly $314,000 and operational expenses are projected to rise by about $59,000.
A notable administrative detail: the federal de minimis cost-share rate increased from 10% to 15% effective May 1 under federal guidance. Transit staff said the change will allow them to charge an additional 5% of qualifying local costs to grants as indirect costs; that shift is projected to increase the amount returned to the city general fund — staff estimated $380,000 to be returned in the proposed budget and additional increases in future years as the new de minimis rate is applied.
Council members asked why ridership rose 13% from the prior year; transit staff attributed growth to more people riding to work and the addition of unfilled expansion slots that would be used as buses and manpower become available to extend service on the east end.
Transit staff emphasized the agency’s revenue-driven budgeting approach and said the state- and federal-grant funding is essential to cover both capital projects and operations.
