Bend MPO budget committee recommends FY 2026 budget, sends package to policy board

The Bend Metropolitan Planning Organization (MPO) budget committee on Wednesday reviewed its proposed fiscal year 2026 operating budget, recommended it for adoption by the MPO policy board and set an April 18 policy-board review date.

The committee’s discussion centered on funding sources and timing, use of reserves, distribution of COVID-relief awards and several planning priorities for FY 2026, including an update to the Transportation Safety Action Plan, maintenance of the Metropolitan Transportation Improvement Program (MTIP) and a transition to an activity-based travel model intended to better capture transit, bike and pedestrian trips.

Why it matters: The MPO coordinates transportation planning and distributes roughly $1.4 million in federal and state transportation funds to member jurisdictions and projects in the Bend area. Decisions about how to reserve and spend those funds affect street preservation, pedestrian and bicycle safety projects, transit stops and other locally delivered work.

Most of the meeting was devoted to budget detail and timing. MPO staff explained that the MPO receives federal funds from the Federal Highway Administration and Federal Transit Administration, state match funding from the Oregon Department of Transportation (ODOT) and occasional grant awards. A recent change in the statewide distribution formula has boosted the MPO’s anticipated federal receipts for FY 2026, staff said. Staff also noted the current federal surface transportation authorization expires in September 2026 and urged continued monitoring of federal reauthorization activity.

On grant- and award-related items, staff said the MPO continues to distribute COVID-relief funding awarded in 2021, which staff described as roughly $1.5 million, and a Safe Streets and Roads for All grant of $200,000 that will fund an update to the MPO’s Transportation Safety Action Plan (TSAP). Several large COVID and state-highway-funded awards are programmed but not yet requested for reimbursement by recipients. Staff said Central Oregon (CED) was among the larger COVID awardees that had not yet submitted reimbursement requests for projects such as transit-stop improvements.

Budget timing and the overnight loan: Staff described the MPO’s common accounting practice of operating on a reimbursement basis and using a short-term “overnight” loan from the City of Bend at fiscal year-end to prevent a temporary negative fund balance while reimbursements are pending. The loan, staff said, is repaid on the first day of the following fiscal year and is an accounting mechanism rather than program funding. The committee discussed the possibility that as the MPO builds its reserve, the short-term loan may not be needed in future years.

Reserves and policy: The policy board previously directed annual contributions from state highway funds into a reserve. Staff told the committee that the proposed FY 2026 budget continues the practice of reserving $80,000 of state highway funds in each of FY 2025, FY 2026 and FY 2027. The City of Bend’s fiscal policy target of roughly a 16% operating reserve was named as the reference point the MPO is using for its operating-reserve goal.

Program priorities: Staff outlined FY 2026 work priorities: completing the TSAP update (funded in part by the $200,000 grant), maintaining the MTIP (the MPO’s four-year list of funded projects), transferring previously awarded state highway funds and COVID awards to recipients when they request reimbursements, and issuing a project solicitation this fall for funds available in the 2028–2030 cycle. Staff also described plans to move the MPO’s travel model to an activity-based framework to better reflect non-vehicle travel modes and to help meet new state planning requirements related to climate and emissions (staff said some document language had been rephrased at federal or state partners’ suggestion while preserving the same substantive work).

Project examples and uses of SHF: Committee members and staff discussed typical project types funded through these award processes: street preservation, pedestrian crossings and Safe Routes to School-type bike/ped projects, signal upgrades and bus-shelter/transit-stop improvements. Staff said the State Highway Fund (SHF) awards have historically contributed a large share of funding for the city’s street preservation program and that the policy board will continue discussions about the appropriate balance of funding for preservation versus other network- or safety-focused projects.

Accounting and reporting clarifications: Committee members pressed staff on differences between recognized revenue and programmed funds, a timing issue driven by reimbursement accounting and the point at which state highway funds are recognized. Staff explained that some SHF awards won’t be invoiced and reimbursed until late in the fiscal year, so audited or “actual” revenue to date may understate the total programed spending for the fiscal year. Staff committed to providing more detail on large individual award recipients in the budget packet.

Committee action and next steps: A committee member moved to approve the FY 2026 budget and recommend MPO policy-board adoption. The motion was seconded and the committee voted to approve and forward the budget; the transcript does not record a roll-call tally in full. Staff said the MPO policy board is scheduled to review and is expected to consider adopting the budget at its April 18 meeting.

The meeting also included routine items: a brief acknowledgment of recent MPO boundary adjustments following the 2020 census (areas near Century Drive, US 97 and US 20, and lands east of Bend), and a recap of the MPO’s role coordinating with member jurisdictions, ODOT and future voting representation by Cascades East Transit.

Committee members praised staff for the clarity of the documents and requested a supplemental breakdown of the larger, outstanding award recipients ahead of the policy-board meeting.