Matanuska-Susitna Borough to become direct recipient of federal transit funds; officials outline service options and timeline

Matanuska-Susitna Borough planning staff told the borough assembly on Jan. 7 that the borough must become the direct recipient of certain Federal Transit Administration (FTA) funds after an urbanized-area designation and outlined four budget-and-service options for maintaining fixed-route and demand-response service.

Jason Ortiz, deputy director of planning, said the change means the borough must receive federal money that previously flowed directly to a nonprofit operator. "The max funding that we can receive from the feds is 1,800,000," Ortiz said, adding that local matching funds would generally be required. Ortiz presented four models (Options A–D) showing different mixes of fixed-route buses and demand-response vehicles and the mill-rate implications for property taxpayers.

The update described two service types: fixed-route motor-coach runs (including service to Anchorage) and demand-response service that serves zones within the borough. Ortiz said the borough’s timeline is to publish a request for information (RFI) in January, issue requests for proposals (RFPs) for demand-response and fixed-route operations in February, and return to the assembly with contract and budget recommendations in March–April so the manager can include any numbers in the manager’s proposed budget.

Camden Yealy of Yealy and Associates, who assisted the planning team, said the borough’s existing fixed-route service reaches Meadow Lakes and Anchorage, while demand-response covers multiple zones including Big Lake, Palmer and Butte. Ortiz said staff used 2023 figures and first-quarter 2024 data to build projected models; full 2024 ridership data was expected at the end of January 2025.

Becca Scottog, identified as a planning staff member, said fares are a very small portion of operating revenue and gave examples: "$10 round trip to Anchorage, $7 one way. I believe it's $120 for a month pass. Students ride for free." She also noted demand-response fares are zone-based (about $3 per zone) and that fares typically cover only about 1–3% of operations.

Staff said the borough may be able to use six state-provided motor-coach buses if liens on those buses are transferred. Manager Brown and Ortiz said that transfer would be significant because it could reduce up-front capital needs and that the borough is exploring contracting options so the borough would administer funding and oversight while a contractor operates and maintains service.

Assembly members raised questions about maintenance costs, whether the borough would assume liens, how fares are treated in budgeting, and geographic reach. Ortiz confirmed vehicle maintenance was included in the operating estimates, and Camden Yealy said fixed-route service reaches as far as Meadow Lakes and Anchorage; demand-response covers broader zones in the borough.

Ortiz and the manager emphasized the transit program will be iterative: the borough will collect data in the first year, test a modest change (staff recommended Option B as conservative), and return to adjust service and funding during subsequent budget cycles. Ortiz also said staff will seek professional transit planning support; the borough could pursue a 90/10 planning fund split (90% federal/10% local) for certain consultant work.

Why it matters: the federal designation changes how transit is funded in the borough and shifts program administration to the local government, which can alter the borough’s budget and service design. Assembly members were told the RFI and RFP process will shape final costs and that staff will present recommended funding levels for the manager’s proposed budget in March.

What’s next: staff will publish the RFI in January, issue RFPs in February for demand-response and fixed-route services, and return with contract recommendations and a proposed budget figure in March–April. Public comment will be taken as part of the procurement and budget processes.