Section 2: Start-Up

Federal Funding

The Federal Transit Administration (FTA) sponsors three programs that are often a core source of funding for transportation voucher programs.

1. Enhanced Mobility of Seniors & Individuals with Disabilities – 5310

2. Formula Grants for Rural Areas – 5311

3. Urbanized Area Formula Grants – 5307

Funds from these programs are typically distributed through state agencies such as the Department of Transportation (DOT). The DOT state coordinators for these programs are among the first people who should be contacted. They can be key gatekeepers and supporters in efforts to connect the transportation coordinator with others in the local area interested in transportation and with relevant state transportation associations for additional allies. Any application for Section 5310 funding needs to include a “Coordinated Public Transit Human Services Transportation Plan” as part of the application. State officials can help guide the process, and the Transportation Interest Network will be helpful in developing that coordinated plan for community transportation.

Another funding option is social service block grants. These are structured similarly to 5310/11/07 funds, where federal funds (from the Office of Community Services) are distributed to states, and each state has different systems for distribution to organizations. 

State Funding

The 5310/11/07 and social service block grant funds are both federal funds administered by states. While there are no universal state-level transportation funds, many states do have funds that can be leveraged. When you engage with your state DOT about 5310/11/07 or social service block grant funds, ask about other options, even if they are from other state agencies. State health and human service departments or workforce development agencies are other state agencies that could possibly have funding to leverage.

Local Funding

Local government agencies may also be willing to provide initial funding to establish a transportation voucher program. It's worth contacting your county commission and town councils regarding their interest and capacity for allocating funds toward a voucher program.

Philanthropic organizations and local businesses may also be willing to support your program. Many private foundations and charitable non-profits will announce opportunities for funding on their websites, typically focused on a specific social cause. Local businesses may also offer unique ways to obtain funding through a fundraising event or sponsorship.

Budgeting Tips

Another strength of voucher programs is that the scale of the program can be adjusted to match available funding. You don’t need a large budget to get started. In fact, it’s usually better to begin small and grow the program over time. Starting with a limited number of riders or trips helps you optimize processes and avoid overspending. If you end up with extra funds, that’s an easy problem to solve. It’s much easier to expand a program than to cut back after running out of money.

As you build relationships with funders and providers, you can adjust the voucher program to meet demand and available resources. Additionally, trial and error will help you find ways to make it easier to run your program over time. Keeping the program flexible allows you to respond to changes in funding, rider needs, and transportation options.