Representative Candice B. Pierucci proposes the following substitute bill:


1     
LOCAL GOVERNMENT TRANSPORTATION SERVICES

2     
AMENDMENTS

3     
2024 GENERAL SESSION

4     
STATE OF UTAH

5     
Chief Sponsor: Candice B. Pierucci

6     
Senate Sponsor: Kirk A. Cullimore

7     

8     LONG TITLE
9     General Description:
10          This bill permits public transit innovation grants and amends provisions related to
11     allocation of certain local option sales and use taxes for transportation.
12     Highlighted Provisions:
13          This bill:
14          ▸     defines terms;
15          ▸     allows certain local option sales and use tax revenue and Transit Transportation
16     Investment Fund money to be used for public transit innovation grants;
17          ▸     requires the Department of Transportation and the Transportation Commission to
18     coordinate grant proposals for public transit innovation and administer certain
19     grants;
20          ▸     grants rulemaking authority to the Transportation Commission to create a
21     prioritization process and to administer grant proposals;
22          ▸     requires grant recipients to report on the use and progress of public transit
23     innovation grant operations;
24          ▸     requires a large public transit district to provide a report to each municipality
25     regarding expenditures, transit service, and ridership utilized by residents; and

26          ▸     makes technical changes.
27     Money Appropriated in this Bill:
28          None
29     Other Special Clauses:
30          This bill provides a special effective date.
31     Utah Code Sections Affected:
32     AMENDS:
33          17B-2a-802, as last amended by Laws of Utah 2023, Chapters 15, 476
34          17B-2a-808.1, as last amended by Laws of Utah 2022, Chapter 207
35          59-12-2202, as last amended by Laws of Utah 2023, Chapter 529
36          59-12-2212.2, as enacted by Laws of Utah 2019, Chapter 479
37          59-12-2219, as last amended by Laws of Utah 2023, Chapter 529
38          59-12-2220, as last amended by Laws of Utah 2023, Chapter 529
39          72-1-303, as last amended by Laws of Utah 2023, Chapter 219
40          72-2-121, as last amended by Laws of Utah 2023, Chapter 529
41          72-2-124, as last amended by Laws of Utah 2023, Chapters 22, 88, 219, and 529
42     ENACTS:
43          17B-2a-828, Utah Code Annotated 1953
44          72-2-301, Utah Code Annotated 1953
45          72-2-302, Utah Code Annotated 1953
46          72-2-303, Utah Code Annotated 1953
47          72-2-304, Utah Code Annotated 1953
48     

49     Be it enacted by the Legislature of the state of Utah:
50          Section 1. Section 17B-2a-802 is amended to read:
51          17B-2a-802. Definitions.
52          As used in this part:
53          (1) "Affordable housing" means housing occupied or reserved for occupancy by
54     households that meet certain gross household income requirements based on the area median
55     income for households of the same size.
56          (a) "Affordable housing" may include housing occupied or reserved for occupancy by

57     households that meet specific area median income targets or ranges of area median income
58     targets.
59          (b) "Affordable housing" does not include housing occupied or reserved for occupancy
60     by households with gross household incomes that are more than 60% of the area median
61     income for households of the same size.
62          (2) "Appointing entity" means the person, county, unincorporated area of a county, or
63     municipality appointing a member to a public transit district board of trustees.
64          (3) (a) "Chief executive officer" means a person appointed by the board of trustees of a
65     small public transit district to serve as chief executive officer.
66          (b) "Chief executive officer" shall enjoy all the rights, duties, and responsibilities
67     defined in Sections 17B-2a-810 and 17B-2a-811 and includes all rights, duties, and
68     responsibilities assigned to the general manager but prescribed by the board of trustees to be
69     fulfilled by the chief executive officer.
70          (4) "Confidential employee" means a person who, in the regular course of the person's
71     duties:
72          (a) assists in and acts in a confidential capacity in relation to other persons who
73     formulate, determine, and effectuate management policies regarding labor relations; or
74          (b) has authorized access to information relating to effectuating or reviewing the
75     employer's collective bargaining policies.
76          (5) "Council of governments" means a decision-making body in each county composed
77     of membership including the county governing body and the mayors of each municipality in the
78     county.
79          (6) "Department" means the Department of Transportation created in Section 72-1-201.
80          (7) "Executive director" means a person appointed by the board of trustees of a large
81     public transit district to serve as executive director.
82          (8) "Fixed guideway" means the same as that term is defined in Section 59-12-102.
83          (9) "Fixed guideway capital development" means the same as that term is defined in
84     Section 72-1-102.
85          (10) (a) "General manager" means a person appointed by the board of trustees of a
86     small public transit district to serve as general manager.
87          (b) "General manager" shall enjoy all the rights, duties, and responsibilities defined in

88     Sections 17B-2a-810 and 17B-2a-811 prescribed by the board of trustees of a small public
89     transit district.
90          (11) "Large public transit district" means a public transit district that provides public
91     transit to an area that includes:
92          (a) more than 65% of the population of the state based on the most recent official
93     census or census estimate of the United States Census Bureau; and
94          (b) two or more counties.
95          (12) (a) "Locally elected public official" means a person who holds an elected position
96     with a county or municipality.
97          (b) "Locally elected public official" does not include a person who holds an elected
98     position if the elected position is not with a county or municipality.
99          (13) "Managerial employee" means a person who is:
100          (a) engaged in executive and management functions; and
101          (b) charged with the responsibility of directing, overseeing, or implementing the
102     effectuation of management policies and practices.
103          (14) "Metropolitan planning organization" means the same as that term is defined in
104     Section 72-1-208.5.
105          (15) "Multicounty district" means a public transit district located in more than one
106     county.
107          (16) "Operator" means a public entity or other person engaged in the transportation of
108     passengers for hire.
109          (17) (a) "Public transit" means regular, continuing, shared-ride, surface transportation
110     services that are open to the general public or open to a segment of the general public defined
111     by age, disability, or low income.
112          (b) "Public transit" does not include transportation services provided by:
113          (i) chartered bus;
114          (ii) sightseeing bus;
115          (iii) taxi;
116          (iv) school bus service;
117          (v) courtesy shuttle service for patrons of one or more specific establishments; or
118          (vi) intra-terminal or intra-facility shuttle services.

119          (18) "Public transit district" means a special district that provides public transit
120     services.
121          (19) (a) "Public transit innovation grant" means the same as that term is defined in
122     Section 72-2-301.
123          [(19)] (20) "Small public transit district" means any public transit district that is not a
124     large public transit district.
125          [(20)] (21) "Station area plan" means a plan developed and adopted by a municipality
126     in accordance with Section 10-9a-403.1.
127          [(21)] (22) (a) "Supervisor" means a person who has authority, in the interest of the
128     employer, to:
129          (i) hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or
130     discipline other employees; or
131          (ii) adjust another employee's grievance or recommend action to adjust another
132     employee's grievance.
133          (b) "Supervisor" does not include a person whose exercise of the authority described in
134     Subsection [(21)(a)] (22)(a):
135          (i) is of a merely routine or clerical nature; and
136          (ii) does not require the person to use independent judgment.
137          [(22)] (23) "Transit facility" means a transit vehicle, transit station, depot, passenger
138     loading or unloading zone, parking lot, or other facility:
139          (a) leased by or operated by or on behalf of a public transit district; and
140          (b) related to the public transit services provided by the district, including:
141          (i) railway or other right-of-way;
142          (ii) railway line; and
143          (iii) a reasonable area immediately adjacent to a designated stop on a route traveled by
144     a transit vehicle.
145          [(23)] (24) "Transit vehicle" means a passenger bus, coach, railcar, van, or other
146     vehicle operated as public transportation by a public transit district.
147          [(24)] (25) "Transit-oriented development" means a mixed use residential or
148     commercial area that is designed to maximize access to public transit and includes the
149     development of land owned by a large public transit district.

150          [(25)] (26) "Transit-supportive development" means a mixed use residential or
151     commercial area that is designed to maximize access to public transit and does not include the
152     development of land owned by a large public transit district.
153          Section 2. Section 17B-2a-808.1 is amended to read:
154          17B-2a-808.1. Large public transit district board of trustees powers and duties --
155     Adoption of ordinances, resolutions, or orders -- Effective date of ordinances.
156          (1) The powers and duties of a board of trustees of a large public transit district stated
157     in this section are in addition to the powers and duties stated in Section 17B-1-301.
158          (2) The board of trustees of each large public transit district shall:
159          (a) hold public meetings and receive public comment;
160          (b) ensure that the policies, procedures, and management practices established by the
161     public transit district meet state and federal regulatory requirements and federal grantee
162     eligibility;
163          (c) subject to Subsection (8), create and approve an annual budget, including the
164     issuance of bonds and other financial instruments, after consultation with the local advisory
165     council;
166          (d) approve any interlocal agreement with a local jurisdiction;
167          (e) in consultation with the local advisory council, approve contracts and overall
168     property acquisitions and dispositions for transit-oriented development;
169          (f) in consultation with constituent counties, municipalities, metropolitan planning
170     organizations, and the local advisory council:
171          (i) develop and approve a strategic plan for development and operations on at least a
172     four-year basis; and
173          (ii) create and pursue funding opportunities for transit capital and service initiatives to
174     meet anticipated growth within the public transit district;
175          (g) annually report the public transit district's long-term financial plan to the State
176     Bonding Commission;
177          (h) annually report the public transit district's progress and expenditures related to state
178     resources to the Executive Appropriations Committee and the Infrastructure and General
179     Government Appropriations Subcommittee;
180          (i) annually report to the Transportation Interim Committee the public transit district's

181     efforts to engage in public-private partnerships for public transit services;
182          (j) hire, set salaries, and develop performance targets and evaluations for:
183          (i) the executive director; and
184          (ii) all chief level officers;
185          (k) supervise and regulate each transit facility that the public transit district owns and
186     operates, including:
187          (i) fix rates, fares, rentals, charges and any classifications of rates, fares, rentals, and
188     charges; and
189          (ii) make and enforce rules, regulations, contracts, practices, and schedules for or in
190     connection with a transit facility that the district owns or controls;
191          (l) subject to Subsection (4), control the investment of all funds assigned to the district
192     for investment, including funds:
193          (i) held as part of a district's retirement system; and
194          (ii) invested in accordance with the participating employees' designation or direction
195     pursuant to an employee deferred compensation plan established and operated in compliance
196     with Section 457 of the Internal Revenue Code;
197          (m) in consultation with the local advisory council created under Section
198     17B-2a-808.2, invest all funds according to the procedures and requirements of Title 51,
199     Chapter 7, State Money Management Act;
200          (n) if a custodian is appointed under Subsection (3)(d), and subject to Subsection (4),
201     pay the fees for the custodian's services from the interest earnings of the investment fund for
202     which the custodian is appointed;
203          (o) (i) cause an annual audit of all public transit district books and accounts to be made
204     by an independent certified public accountant;
205          (ii) as soon as practicable after the close of each fiscal year, submit to each of the
206     councils of governments within the public transit district a financial report showing:
207          (A) the result of district operations during the preceding fiscal year;
208          (B) an accounting of the expenditures of all local sales and use tax revenues generated
209     under Title 59, Chapter 12, Part 22, Local Option Sales and Use Taxes for Transportation Act;
210          (C) the district's financial status on the final day of the fiscal year; and
211          (D) the district's progress and efforts to improve efficiency relative to the previous

212     fiscal year; and
213          (iii) supply copies of the report under Subsection (2)(o)(ii) to the general public upon
214     request;
215          (p) report at least annually to the Transportation Commission created in Section
216     72-1-301, which report shall include:
217          (i) the district's short-term and long-range public transit plans, including the portions of
218     applicable regional transportation plans adopted by a metropolitan planning organization
219     established under 23 U.S.C. Sec. 134; and
220          (ii) any transit capital development projects that the board of trustees would like the
221     Transportation Commission to consider;
222          (q) direct the internal auditor appointed under Section 17B-2a-810 to conduct audits
223     that the board of trustees determines, in consultation with the local advisory council created in
224     Section 17B-2a-808.2, to be the most critical to the success of the organization;
225          (r) together with the local advisory council created in Section 17B-2a-808.2, hear audit
226     reports for audits conducted in accordance with Subsection (2)(o);
227          (s) review and approve all contracts pertaining to reduced fares, and evaluate existing
228     contracts, including review of:
229          (i) how negotiations occurred;
230          (ii) the rationale for providing a reduced fare; and
231          (iii) identification and evaluation of cost shifts to offset operational costs incurred and
232     impacted by each contract offering a reduced fare;
233          (t) in consultation with the local advisory council, develop and approve other board
234     policies, ordinances, and bylaws; [and]
235          (u) review and approve any:
236          (i) contract or expense exceeding $200,000; or
237          (ii) proposed change order to an existing contract if the change order:
238          (A) increases the total contract value to $200,000 or more;
239          (B) increases a contract of or expense of $200,000 or more by 15% or more; or
240          (C) has a total change order value of $200,000 or more[.]; and
241          (v) coordinate with political subdivisions within the large public transit district and the
242     department to coordinate public transit services provided by the large public transit district with

243     pilot services related to public transit innovation grants.
244          (3) A board of trustees of a large public transit district may:
245          (a) subject to Subsection (5), make and pass ordinances, resolutions, and orders that
246     are:
247          (i) not repugnant to the United States Constitution, the Utah Constitution, or the
248     provisions of this part; and
249          (ii) necessary for:
250          (A) the governance and management of the affairs of the district;
251          (B) the execution of district powers; and
252          (C) carrying into effect the provisions of this part;
253          (b) provide by resolution, under terms and conditions the board considers fit, for the
254     payment of demands against the district without prior specific approval by the board, if the
255     payment is:
256          (i) for a purpose for which the expenditure has been previously approved by the board;
257          (ii) in an amount no greater than the amount authorized; and
258          (iii) approved by the executive director or other officer or deputy as the board
259     prescribes;
260          (c) in consultation with the local advisory council created in Section 17B-2a-808.2:
261          (i) hold public hearings and subpoena witnesses; and
262          (ii) appoint district officers to conduct a hearing and require the officers to make
263     findings and conclusions and report them to the board; and
264          (d) appoint a custodian for the funds and securities under its control, subject to
265     Subsection (2)(n).
266          (4) For a large public transit district in existence as of May 8, 2018, on or before
267     September 30, 2019, the board of trustees of a large public transit district shall present a report
268     to the Transportation Interim Committee regarding retirement benefits of the district, including:
269          (a) the feasibility of becoming a participating employer and having retirement benefits
270     of eligible employees and officials covered in applicable systems and plans administered under
271     Title 49, Utah State Retirement and Insurance Benefit Act;
272          (b) any legal or contractual restrictions on any employees that are party to a collectively
273     bargained retirement plan; and

274          (c) a comparison of retirement plans offered by the large public transit district and
275     similarly situated public employees, including the costs of each plan and the value of the
276     benefit offered.
277          (5) The board of trustees may not issue a bond unless the board of trustees has
278     consulted and received approval from the State Finance Review Commission created in Section
279     63C-25-201.
280          (6) A member of the board of trustees of a large public transit district or a hearing
281     officer designated by the board may administer oaths and affirmations in a district investigation
282     or proceeding.
283          (7) (a) The vote of the board of trustees on each ordinance or resolution shall be by roll
284     call vote with each affirmative and negative vote recorded.
285          (b) The board of trustees of a large public transit district may not adopt an ordinance
286     unless it is introduced at least 24 hours before the board of trustees adopts it.
287          (c) Each ordinance adopted by a large public transit district's board of trustees shall
288     take effect upon adoption, unless the ordinance provides otherwise.
289          (8) (a) The board of trustees shall provide a report to each city and town within the
290     boundary of the large public transit district, that shall provide an accounting of:
291          (i) the amount of revenue from local option sales and use taxes under this part that was
292     collected within each respective county, city, or town and allocated to the large public transit
293     district as provided in this part;
294          (ii) how much revenue described in Subsection (8)(a) was allocated to provide public
295     transit services utilized by residents of each city and town; and
296          (iii) how the revenue described in Subsection (8)(b) was spent to provide public transit
297     services utilized by residents of each respective city and town.
298          (b) The board of trustees shall provide the report described in Subsection (8)(a):
299          (i) on or before January 1, 2025; and
300          (ii) at least every two years thereafter.
301          (c) To provide the report described in this Subsection (4), a board of trustees may
302     coordinate with the Department of Transportation to report on relevant public transit capital
303     development administered by the Department of Transportation.
304          [(8) (a) For a large public transit district in existence on May 8, 2018, for the budget

305     for calendar year 2019, the board in place on May 8, 2018, shall create the tentative annual
306     budget.]
307          [(b) The budget described in Subsection (8)(a) shall include setting the salary of each
308     of the members of the board of trustees that will assume control on or before November 1,
309     2018, which salary may not exceed $150,000, plus additional retirement and other standard
310     benefits, as set by the local advisory council as described in Section 17B-2a-808.2.]
311          [(c) For a large public transit district in existence on May 8, 2018, the board of trustees
312     that assumes control of the large public transit district on or before November 2, 2018, shall
313     approve the calendar year 2019 budget on or before December 31, 2018.]
314          Section 3. Section 17B-2a-828 is enacted to read:
315          17B-2a-828. Public transit innovation grants.
316          (1) A public transit district shall coordinate public transit services provided by the
317     public transit district with pilot services related to public transit innovation grants.
318          (2) After receiving the reports described in Section 72-2-304, the public transit district
319     shall consider integrating awarded public transit innovation grant operations that meet the
320     public transit district's service planning standards.
321          Section 4. Section 59-12-2202 is amended to read:
322          59-12-2202. Definitions.
323          As used in this part:
324          (1) "Airline" means the same as that term is defined in Section 59-2-102.
325          (2) "Airport facility" means the same as that term is defined in Section 59-12-602.
326          (3) "Airport of regional significance" means an airport identified by the Federal
327     Aviation Administration in the most current National Plan of Integrated Airport Systems or an
328     update to the National Plan of Integrated Airport Systems.
329          (4) "Annexation" means an annexation to:
330          (a) a county under Title 17, Chapter 2, County Consolidations and Annexations; or
331          (b) a city or town under Title 10, Chapter 2, Part 4, Annexation.
332          (5) "Annexing area" means an area that is annexed into a county, city, or town.
333          (6) "Class A road" means the same as that term is described in Section 72-3-102.
334          (7) "Class B road" means the same as that term is described in Section 72-3-103.
335          (8) "Class C road" means the same as that term is described in Section 72-3-104.

336          (9) "Class D road" means the same as that term is described in Section 72-3-105.
337          (10) "Council of governments" means the same as that term is defined in Section
338     72-2-117.5.
339          (11) "Eligible political subdivision" means a political subdivision that:
340          (a) provides public transit services;
341          (b) is not a public transit district; and
342          (c) is not annexed into a public transit district.
343          (12) "Fixed guideway" means the same as that term is defined in Section 59-12-102.
344          (13) "Large public transit district" means the same as that term is defined in Section
345     17B-2a-802.
346          (14) "Major collector highway" means the same as that term is defined in Section
347     72-4-102.5.
348          (15) "Metropolitan planning organization" means the same as that term is defined in
349     Section 72-1-208.5.
350          (16) "Minor arterial highway" means the same as that term is defined in Section
351     72-4-102.5.
352          (17) "Minor collector road" means the same as that term is defined in Section
353     72-4-102.5.
354          (18) "Principal arterial highway" means the same as that term is defined in Section
355     72-4-102.5.
356          (19) "Public transit" means the same as that term is defined in Section 17B-2a-802.
357          (20) "Public transit district" means the same as that term is defined in Section
358     17B-2a-802.
359          (21) "Public transit innovation grant" means the same as that term is defined in Section
360     72-2-301.
361          [(21)] (22) "Public transit provider" means a public transit district or an eligible
362     political subdivision.
363          [(22)] (23) "Public transit service" means a service provided as part of public transit.
364          [(23)] (24) "Regionally significant transportation facility" means:
365          (a) in a county of the first or second class:
366          (i) a principal arterial highway;

367          (ii) a minor arterial highway;
368          (iii) a fixed guideway that:
369          (A) extends across two or more cities or unincorporated areas; or
370          (B) is an extension to an existing fixed guideway; or
371          (iv) an airport of regional significance; or
372          (b) in a county of the second class that is not part of a large public transit district, or in
373     a county of the third, fourth, fifth, or sixth class:
374          (i) a principal arterial highway;
375          (ii) a minor arterial highway;
376          (iii) a major collector highway;
377          (iv) a minor collector road; or
378          (v) an airport of regional significance.
379          [(24)] (25) "State highway" means a highway designated as a state highway under Title
380     72, Chapter 4, Designation of State Highways Act.
381          [(25)] (26) (a) Subject to Subsection [(25)(b)] (26)(b), "system for public transit"
382     means the same as the term "public transit" is defined in Section 17B-2a-802.
383          (b) "System for public transit" includes:
384          (i) the following costs related to public transit:
385          (A) maintenance costs; or
386          (B) operating costs;
387          (ii) a fixed guideway;
388          (iii) a park and ride facility;
389          (iv) a passenger station or passenger terminal;
390          (v) a right-of-way for public transit; or
391          (vi) the following that serve a public transit facility:
392          (A) a maintenance facility;
393          (B) a platform;
394          (C) a repair facility;
395          (D) a roadway;
396          (E) a storage facility;
397          (F) a utility line; or

398          (G) a facility or item similar to those described in Subsections [(25)(b)(vi)(A)]
399     (26)(b)(vi)(A) through (F).
400          Section 5. Section 59-12-2212.2 is amended to read:
401          59-12-2212.2. Allowable uses of local option sales and use tax revenue.
402          (1) Except as otherwise provided in this part, a county, city, or town that imposes a
403     local option sales and use tax under this part may expend the revenue generated from the local
404     option sales and use tax for the following purposes:
405          (a) the development, construction, maintenance, or operation of:
406          (i) a class A road;
407          (ii) a class B road;
408          (iii) a class C road;
409          (iv) a class D road;
410          (v) traffic and pedestrian safety infrastructure, including:
411          (A) a sidewalk;
412          (B) curb and gutter;
413          (C) a safety feature;
414          (D) a traffic sign;
415          (E) a traffic signal; or
416          (F) street lighting;
417          (vi) streets, alleys, roads, highways, and thoroughfares of any kind, including
418     connected structures;
419          (vii) an airport facility;
420          (viii) an active transportation facility that is for nonmotorized vehicles and multimodal
421     transportation and connects an origin with a destination; or
422          (ix) an intelligent transportation system;
423          (b) a system for public transit;
424          (c) all other modes and forms of conveyance used by the public;
425          (d) debt service or bond issuance costs related to a project or facility described in
426     Subsections (1)(a) through (c); or
427          (e) corridor preservation related to a project or facility described in Subsections (1)(a)
428     through (c).

429          (2) Any revenue subject to rights or obligations under a contract between a county,
430     city, or town and a public transit district entered into before January 1, 2019, remains subject to
431     existing contractual rights and obligations.
432          (3) In addition to the uses described in Subsection (1), for any revenue generated by a
433     sales and use tax imposed under Section 59-12-2219 that is not contractually obligated for debt
434     service, the percentage described in Subsection 59-12-2219(11) shall be made available for
435     public transit innovation grants as provided in Title 72, Chapter 2, Part 3, Public Transit
436     Innovation Grants.
437          Section 6. Section 59-12-2219 is amended to read:
438          59-12-2219. County option sales and use tax for highways and public transit --
439     Base -- Rate -- Distribution and expenditure of revenue -- Revenue may not supplant
440     existing budgeted transportation revenue.
441          (1) Subject to the other provisions of this part, and subject to Subsection (13), a county
442     legislative body may impose a sales and use tax of .25% on the transactions described in
443     Subsection 59-12-103(1) within the county, including the cities and towns within the county.
444          (2) Subject to Subsection (9), the commission shall distribute sales and use tax revenue
445     collected under this section as provided in Subsections (3) through (8).
446          (3) If the entire boundary of a county that imposes a sales and use tax under this section
447     is annexed into a single public transit district, the commission shall distribute the sales and use
448     tax revenue collected within the county as follows:
449          (a) .10% shall be transferred to the public transit district in accordance with Section
450     59-12-2206;
451          (b) .10% shall be distributed as provided in Subsection (6); and
452          (c) .05% shall be distributed to the county legislative body.
453          (4) If the entire boundary of a county that imposes a sales and use tax under this section
454     is not annexed into a single public transit district, but a city or town within the county is
455     annexed into a single large public transit district, the commission shall distribute the sales and
456     use tax revenue collected within the county as follows:
457          (a) for a city or town within the county that is annexed into a single public transit
458     district, the commission shall distribute the sales and use tax revenue collected within that city
459     or town as follows:

460          (i) .10% shall be transferred to the public transit district in accordance with Section
461     59-12-2206;
462          (ii) .10% shall be distributed as provided in Subsection (6); and
463          (iii) .05% shall be distributed to the county legislative body;
464          (b) for an eligible political subdivision within the county, the commission shall
465     distribute the sales and use tax revenue collected within that eligible political subdivision as
466     follows:
467          (i) .10% shall be transferred to the eligible political subdivision in accordance with
468     Section 59-12-2206;
469          (ii) .10% shall be distributed as provided in Subsection (6); and
470          (iii) .05% shall be distributed to the county legislative body; and
471          (c) the commission shall distribute the sales and use tax revenue, except for the sales
472     and use tax revenue described in Subsections (4)(a) and (b), as follows:
473          (i) .10% shall be distributed as provided in Subsection (6); and
474          (ii) .15% shall be distributed to the county legislative body.
475          (5) For a county not described in Subsection (3) or (4), if a county of the second, third,
476     fourth, fifth, or sixth class imposes a sales and use tax under this section, the commission shall
477     distribute the sales and use tax revenue collected within the county as follows:
478          (a) for a city or town within the county that is annexed into a single public transit
479     district, the commission shall distribute the sales and use tax revenue collected within that city
480     or town as follows:
481          (i) .10% shall be distributed as provided in Subsection (6);
482          (ii) .10% shall be distributed as provided in Subsection (7); and
483          (iii) .05% shall be distributed to the county legislative body;
484          (b) for an eligible political subdivision within the county, the commission shall
485     distribute the sales and use tax revenue collected within that eligible political subdivision as
486     follows:
487          (i) .10% shall be distributed as provided in Subsection (6);
488          (ii) .10% shall be distributed as provided in Subsection (7); and
489          (iii) .05% shall be distributed to the county legislative body; and
490          (c) the commission shall distribute the sales and use tax revenue, except for the sales

491     and use tax revenue described in Subsections (5)(a) and (b), as follows:
492          (i) .10% shall be distributed as provided in Subsection (6); and
493          (ii) .15% shall be distributed to the county legislative body.
494          (6) (a) Subject to Subsection (6)(b), the commission shall make the distributions
495     required by Subsections (3)(b), (4)(a)(ii), (4)(b)(ii), (4)(c)(i), (5)(a)(i), (5)(b)(i), (5)(c)(i), and
496     (7)(d)(ii)(A) as follows:
497          (i) 50% of the total revenue collected under Subsections (3)(b), (4)(a)(ii), (4)(b)(ii),
498     (4)(c)(i), (5)(a)(i), (5)(b)(i), (5)(c)(i), and (7)(d)(ii)(A) within the counties and cities that
499     impose a tax under this section shall be distributed to the unincorporated areas, cities, and
500     towns within those counties and cities on the basis of the percentage that the population of each
501     unincorporated area, city, or town bears to the total population of all of the counties and cities
502     that impose a tax under this section; and
503          (ii) 50% of the total revenue collected under Subsections (3)(b), (4)(a)(ii), (4)(b)(ii),
504     (4)(c)(i), (5)(a)(i), (5)(b)(i), (5)(c)(i), and (7)(d)(ii)(A) within the counties and cities that
505     impose a tax under this section shall be distributed to the unincorporated areas, cities, and
506     towns within those counties and cities on the basis of the location of the transaction as
507     determined under Sections 59-12-211 through 59-12-215.
508          (b) (i) Population for purposes of this Subsection (6) shall be determined on the basis
509     of the most recent official census or census estimate of the United States Bureau of the Census.
510          (ii) If a needed population estimate is not available from the United States Bureau of
511     the Census, population figures shall be derived from an estimate from the Utah Population
512     Committee.
513          (7) (a) (i) Subject to the requirements in Subsections (7)(b) and (c), a county legislative
514     body:
515          (A) for a county that obtained approval from a majority of the county's registered
516     voters voting on the imposition of a sales and use tax under this section prior to May 10, 2016,
517     may, in consultation with any cities, towns, or eligible political subdivisions within the county,
518     and in compliance with the requirements for changing an allocation under Subsection (7)(e),
519     allocate the revenue under Subsection (5)(a)(ii) or (5)(b)(ii) by adopting a resolution specifying
520     the percentage of revenue under Subsection (5)(a)(ii) or (5)(b)(ii) that will be allocated to a
521     public transit district or an eligible political subdivision; or

522          (B) for a county that imposes a sales and use tax under this section on or after May 10,
523     2016, shall, in consultation with any cities, towns, or eligible political subdivisions within the
524     county, allocate the revenue under Subsection (5)(a)(ii) or (5)(b)(ii) by adopting a resolution
525     specifying the percentage of revenue under Subsection (5)(a)(ii) or (5)(b)(ii) that will be
526     allocated to a public transit district or an eligible political subdivision.
527          (ii) If a county described in Subsection (7)(a)(i)(A) does not allocate the revenue under
528     Subsection (5)(a)(ii) or (5)(b)(ii) in accordance with Subsection (7)(a)(i)(A), the commission
529     shall distribute 100% of the revenue under Subsection (5)(a)(ii) or (5)(b)(ii) to:
530          (A) a public transit district for a city or town within the county that is annexed into a
531     single public transit district; or
532          (B) an eligible political subdivision within the county.
533          (b) If a county legislative body allocates the revenue as described in Subsection
534     (7)(a)(i), the county legislative body shall allocate not less than 25% of the revenue under
535     Subsection (5)(a)(ii) or (5)(b)(ii) to:
536          (i) a public transit district for a city or town within the county that is annexed into a
537     single public transit district; or
538          (ii) an eligible political subdivision within the county.
539          (c) Notwithstanding Section 59-12-2208, the opinion question described in Section
540     59-12-2208 shall state the allocations the county legislative body makes in accordance with this
541     Subsection (7).
542          (d) The commission shall make the distributions required by Subsection (5)(a)(ii) or
543     (5)(b)(ii) as follows:
544          (i) the percentage specified by a county legislative body shall be distributed in
545     accordance with a resolution adopted by a county legislative body under Subsection (7)(a) to an
546     eligible political subdivision or a public transit district within the county; and
547          (ii) except as provided in Subsection (7)(a)(ii), if a county legislative body allocates
548     less than 100% of the revenue under Subsection (5)(a)(ii) or (5)(b)(ii) to a public transit district
549     or an eligible political subdivision, the remainder of the revenue under Subsection (5)(a)(ii) or
550     (5)(b)(ii) not allocated by a county legislative body through a resolution under Subsection
551     (7)(a) shall be distributed as follows:
552          (A) 50% of the revenue as provided in Subsection (6); and

553          (B) 50% of the revenue to the county legislative body.
554          (e) If a county legislative body seeks to change an allocation specified in a resolution
555     under Subsection (7)(a), the county legislative body may change the allocation by:
556          (i) adopting a resolution in accordance with Subsection (7)(a) specifying the percentage
557     of revenue under Subsection (5)(a)(ii) or (5)(b)(ii) that will be allocated to a public transit
558     district or an eligible political subdivision;
559          (ii) obtaining approval to change the allocation of the sales and use tax by a majority of
560     all the members of the county legislative body; and
561          (iii) subject to Subsection (7)(f):
562          (A) in accordance with Section 59-12-2208, submitting an opinion question to the
563     county's registered voters voting on changing the allocation so that each registered voter has the
564     opportunity to express the registered voter's opinion on whether the allocation should be
565     changed; and
566          (B) in accordance with Section 59-12-2208, obtaining approval to change the
567     allocation from a majority of the county's registered voters voting on changing the allocation.
568          (f) Notwithstanding Section 59-12-2208, the opinion question required by Subsection
569     (7)(e)(iii)(A) shall state the allocations specified in the resolution adopted in accordance with
570     Subsection (7)(e) and approved by the county legislative body in accordance with Subsection
571     (7)(e)(ii).
572          (g) (i) If a county makes an allocation by adopting a resolution under Subsection (7)(a)
573     or changes an allocation by adopting a resolution under Subsection (7)(e), the allocation shall
574     take effect on the first distribution the commission makes under this section after a 90-day
575     period that begins on the date the commission receives written notice meeting the requirements
576     of Subsection (7)(g)(ii) from the county.
577          (ii) The notice described in Subsection (7)(g)(i) shall state:
578          (A) that the county will make or change the percentage of an allocation under
579     Subsection (7)(a) or (e); and
580          (B) the percentage of revenue under Subsection (5)(a)(ii) or (5)(b)(ii) that will be
581     allocated to a public transit district or an eligible political subdivision.
582          (8) (a) If a public transit district is organized after the date a county legislative body
583     first imposes a tax under this section, a change in a distribution required by this section may

584     not take effect until the first distribution the commission makes under this section after a
585     90-day period that begins on the date the commission receives written notice from the public
586     transit district of the organization of the public transit district.
587          (b) If an eligible political subdivision intends to provide public transit service within a
588     county after the date a county legislative body first imposes a tax under this section, a change
589     in a distribution required by this section may not take effect until the first distribution the
590     commission makes under this section after a 90-day period that begins on the date the
591     commission receives written notice from the eligible political subdivision stating that the
592     eligible political subdivision intends to provide public transit service within the county.
593          (9) (a) (i) Notwithstanding Subsections (3) through (8), for a county that has not
594     imposed a sales and use tax under this section before May 8, 2018, and if the county imposes a
595     sales and use tax under this section before June 30, 2019, the commission shall distribute all of
596     the sales and use tax revenue collected by the county before June 30, 2019, to the county for
597     the purposes described in Subsection (9)(a)(ii).
598          (ii) For any revenue collected by a county pursuant to Subsection (9)(a)(i) before June
599     30, 2019, the county may expend that revenue for:
600          (A) reducing transportation related debt;
601          (B) a regionally significant transportation facility; or
602          (C) a public transit project of regional significance.
603          (b) For a county that has not imposed a sales and use tax under this section before May
604     8, 2018, and if the county imposes a sales and use tax under this section before June 30, 2019,
605     the commission shall distribute the sales and use tax revenue collected by the county on or after
606     July 1, 2019, as described in Subsections (3) through (8).
607          (c) For a county that has not imposed a sales and use tax under this section before June
608     30, 2019, if the entire boundary of that county is annexed into a large public transit district, and
609     if the county imposes a sales and use tax under this section on or after July 1, 2019, the
610     commission shall distribute the sales and use tax revenue collected by the county as described
611     in Subsections (3) through (8).
612          (10) A county, city, or town may expend revenue collected from a tax under this
613     section, except for revenue the commission distributes in accordance with Subsection (3)(a),
614     (4)(a)(i), (4)(b)(i), or (7)(d)(i), for a purpose described in Section 59-12-2212.2.

615          (11) (a) A public transit district or an eligible political subdivision may expend revenue
616     the commission distributes in accordance with Subsection (3)(a), (4)(a)(i), (4)(b)(i), or (7)(d)(i)
617     for capital expenses and service delivery expenses of the public transit district or eligible
618     political subdivision.
619          (b) As provided in Section 59-12-2212.2, for the .10% designated for public transit
620     described in Subsection (3)(a) that is not contractually obligated for debt service, beginning on
621     July 1, 2025, a public transit district shall make available to the Department of Transportation
622     an amount equal to 10% of the .10% to be used for public transit innovation grants as provided
623     in Title 72, Chapter 2, Part 3, Public Transit Innovation Grants.
624          (12) Notwithstanding Section 59-12-2208, a county, city, or town legislative body may,
625     but is not required to, submit an opinion question to the county's, city's, or town's registered
626     voters in accordance with Section 59-12-2208 to impose a sales and use tax under this section.
627          (13) (a) (i) Notwithstanding any other provision in this section, if the entire boundary
628     of a county is annexed into a large public transit district, if the county legislative body wishes
629     to impose a sales and use tax under this section, the county legislative body shall pass the
630     ordinance to impose a sales and use tax under this section on or before June 30, 2022.
631          (ii) If the entire boundary of a county is annexed into a large public transit district, the
632     county legislative body may not pass an ordinance to impose a sales and use tax under this
633     section on or after July 1, 2022.
634          (b) Notwithstanding the deadline described in Subsection (13)(a), any sales and use tax
635     imposed under this section by passage of a county ordinance on or before June 30, 2022, may
636     remain in effect.
637          (14) (a) Beginning on July 1, 2020, and subject to Subsection (15), if a county has not
638     imposed a sales and use tax under this section, subject to the provisions of this part, the
639     legislative body of a city or town described in Subsection (14)(b) may impose a .25% sales and
640     use tax on the transactions described in Subsection 59-12-103(1) within the city or town.
641          (b) The following cities or towns may impose a sales and use tax described in
642     Subsection (14)(a):
643          (i) a city or town that has been annexed into a public transit district; or
644          (ii) an eligible political subdivision.
645          (c) If a city or town imposes a sales and use tax as provided in this section, the

646     commission shall distribute the sales and use tax revenue collected by the city or town as
647     follows:
648          (i) .125% to the city or town that imposed the sales and use tax, to be distributed as
649     provided in Subsection (6); and
650          (ii) .125%, as applicable, to:
651          (A) the public transit district in which the city or town is annexed; or
652          (B) the eligible political subdivision for public transit services.
653          (d) If a city or town imposes a sales and use tax under this section and the county
654     subsequently imposes a sales and use tax under this section, the commission shall distribute the
655     sales and use tax revenue collected within the city or town as described in Subsection (14)(c).
656          (15) (a) (i) Notwithstanding any other provision in this section, if a city or town
657     legislative body wishes to impose a sales and use tax under this section, the city or town
658     legislative body shall pass the ordinance to impose a sales and use tax under this section on or
659     before June 30, 2022.
660          (ii) A city or town legislative body may not pass an ordinance to impose a sales and use
661     tax under this section on or after July 1, 2022.
662          (b) Notwithstanding the deadline described in Subsection (15)(a), any sales and use tax
663     imposed under this section by passage of an ordinance by a city or town legislative body on or
664     before June 30, 2022, may remain in effect.
665          Section 7. Section 59-12-2220 is amended to read:
666          59-12-2220. County option sales and use tax to fund highways or a system for
667     public transit -- Base -- Rate.
668          (1) Subject to the other provisions of this part and subject to the requirements of this
669     section, the following counties may impose a sales and use tax under this section:
670          (a) a county legislative body may impose the sales and use tax on the transactions
671     described in Subsection 59-12-103(1) located within the county, including the cities and towns
672     within the county if:
673          (i) the entire boundary of a county is annexed into a large public transit district; and
674          (ii) the maximum amount of sales and use tax authorizations allowed pursuant to
675     Section 59-12-2203 and authorized under the following sections has been imposed:
676          (A) Section 59-12-2213;

677          (B) Section 59-12-2214;
678          (C) Section 59-12-2215;
679          (D) Section 59-12-2216;
680          (E) Section 59-12-2217;
681          (F) Section 59-12-2218; and
682          (G) Section 59-12-2219;
683          (b) if the county is not annexed into a large public transit district, the county legislative
684     body may impose the sales and use tax on the transactions described in Subsection
685     59-12-103(1) located within the county, including the cities and towns within the county if:
686          (i) the county is an eligible political subdivision; or
687          (ii) a city or town within the boundary of the county is an eligible political subdivision;
688     or
689          (c) a county legislative body of a county not described in Subsection (1)(a) may impose
690     the sales and use tax on the transactions described in Subsection 59-12-103(1) located within
691     the county, including the cities and towns within the county.
692          (2) For purposes of Subsection (1) and subject to the other provisions of this section, a
693     county legislative body that imposes a sales and use tax under this section may impose the tax
694     at a rate of .2%.
695          (3) (a) The commission shall distribute sales and use tax revenue collected under this
696     section as determined by a county legislative body as described in Subsection (3)(b).
697          (b) If a county legislative body imposes a sales and use tax as described in this section,
698     the county legislative body may elect to impose a sales and use tax revenue distribution as
699     described in Subsection (4), (5), (6), or (7), depending on the class of county, and presence and
700     type of a public transit provider in the county.
701          (4) If a county legislative body imposes a sales and use tax as described in this section,
702     and the entire boundary of the county is annexed into a large public transit district, and the
703     county is a county of the first class, the commission shall distribute the sales and use tax
704     revenue as follows:
705          (a) .10% to a public transit district as described in Subsection (11);
706          (b) .05% to the cities and towns as provided in Subsection (8); and
707          (c) .05% to the county legislative body.

708          (5) If a county legislative body imposes a sales and use tax as described in this section
709     and the entire boundary of the county is annexed into a large public transit district, and the
710     county is a county not described in Subsection (4), the commission shall distribute the sales
711     and use tax revenue as follows:
712          (a) .10% to a public transit district as described in Subsection (11);
713          (b) .05% to the cities and towns as provided in Subsection (8); and
714          (c) .05% to the county legislative body.
715          (6) (a) Except as provided in Subsection (12)(c), if the entire boundary of a county that
716     imposes a sales and use tax as described in this section is not annexed into a single public
717     transit district, but a city or town within the county is annexed into a single public transit
718     district, or if the city or town is an eligible political subdivision, the commission shall distribute
719     the sales and use tax revenue collected within the county as provided in Subsection (6)(b) or
720     (c).
721          (b) For a city, town, or portion of the county described in Subsection (6)(a) that is
722     annexed into the single public transit district, or an eligible political subdivision, the
723     commission shall distribute the sales and use tax revenue collected within the portion of the
724     county that is within a public transit district or eligible political subdivision as follows:
725          (i) .05% to a public transit provider as described in Subsection (11);
726          (ii) .075% to the cities and towns as provided in Subsection (8); and
727          (iii) .075% to the county legislative body.
728          (c) Except as provided in Subsection (12)(c), for a city, town, or portion of the county
729     described in Subsection (6)(a) that is not annexed into a single public transit district or eligible
730     political subdivision in the county, the commission shall distribute the sales and use tax
731     revenue collected within that portion of the county as follows:
732          (i) .08% to the cities and towns as provided in Subsection (8); and
733          (ii) .12% to the county legislative body.
734          (7) For a county without a public transit service that imposes a sales and use tax as
735     described in this section, the commission shall distribute the sales and use tax revenue
736     collected within the county as follows:
737          (a) .08% to the cities and towns as provided in Subsection (8); and
738          (b) .12% to the county legislative body.

739          (8) (a) Subject to Subsections (8)(b) and (c), the commission shall make the
740     distributions required by Subsections (4)(b), (5)(b), (6)(b)(ii), (6)(c)(i), and (7)(a) as follows:
741          (i) 50% of the total revenue collected under Subsections (4)(b), (5)(b), (6)(b)(ii),
742     (6)(c)(i), and (7)(a) within the counties that impose a tax under Subsections (4) through (7)
743     shall be distributed to the unincorporated areas, cities, and towns within those counties on the
744     basis of the percentage that the population of each unincorporated area, city, or town bears to
745     the total population of all of the counties that impose a tax under this section; and
746          (ii) 50% of the total revenue collected under Subsections (4)(b), (5)(b), (6)(b)(ii),
747     (6)(c)(i), and (7)(a) within the counties that impose a tax under Subsections (4) through (7)
748     shall be distributed to the unincorporated areas, cities, and towns within those counties on the
749     basis of the location of the transaction as determined under Sections 59-12-211 through
750     59-12-215.
751          (b) (i) Population for purposes of this Subsection (8) shall be determined on the basis
752     of the most recent official census or census estimate of the United States Census Bureau.
753          (ii) If a needed population estimate is not available from the United States Census
754     Bureau, population figures shall be derived from an estimate from the Utah Population
755     Estimates Committee created by executive order of the governor.
756          (c) (i) Beginning on January 1, 2024, if the Housing and Community Development
757     Division within the Department of Workforce Services determines that a city, town, or metro
758     township is ineligible for funds in accordance with Subsection 10-9a-408(7), beginning the
759     first day of the calendar quarter after receiving 90 days' notice, the commission shall distribute
760     the distribution that city, town, or metro township would have received under Subsection (8)(a)
761     to cities, towns, or metro townships to which Subsection 10-9a-408(7) does not apply.
762          (ii) Beginning on January 1, 2024, if the Housing and Community Development
763     Division within the Department of Workforce Services determines that a county is ineligible
764     for funds in accordance with Subsection 17-27a-408(7), beginning the first day of the calendar
765     quarter after receiving 90 days' notice, the commission shall distribute the distribution that
766     county would have received under Subsection (8)(a) to counties to which Subsection
767     17-27a-408(7) does not apply.
768          (9) If a public transit service is organized after the date a county legislative body first
769     imposes a tax under this section, a change in a distribution required by this section may not

770     take effect until the first distribution the commission makes under this section after a 90-day
771     period that begins on the date the commission receives written notice from the public transit
772     provider that the public transit service has been organized.
773          (10) A county, city, or town that received distributions described in Subsections (4)(b),
774     (4)(c), (5)(b), (5)(c), (6)(b)(ii), (6)(b)(iii), (6)(c), and (7) may only expend those funds for a
775     purpose described in Section 59-12-2212.2.
776          (11) (a) Subject to Subsections (11)(b), (c), and (d), revenue designated for public
777     transit as described in this section may be used for capital expenses and service delivery
778     expenses of:
779          (i) a public transit district;
780          (ii) an eligible political subdivision; or
781          (iii) another entity providing a service for public transit or a transit facility within the
782     relevant county, as those terms are defined in Section 17B-2a-802.
783          (b) (i) (A) If a county of the first class imposes a sales and use tax described in this
784     section, for a three-year period following the date on which the county imposes the sales and
785     use tax under this section, revenue designated for public transit within a county of the first class
786     as described in Subsection (4)(a) shall be transferred to the County of the First Class Highway
787     Projects Fund created in Section 72-2-121.
788          (B) Revenue deposited into the County of the First Class Highway Projects Fund
789     created in Section 72-2-121 as described in Subsection (11)(b)(i)(A) may be used for public
790     transit innovation grants as provided in Title 72, Chapter 2, Part 3, Public Transit Innovation
791     Grants.
792          (ii) If a county of the first class imposes a sales and use tax described in this section,
793     beginning on the day three years after the date on which the county imposed the tax as
794     described in Subsection (11)(b)(i), for revenue designated for public transit as described in
795     Subsection (4)(a):
796          (A) 50% of the revenue from a sales and use tax imposed under this section in a county
797     of the first class shall be transferred to the County of the First Class Highway Projects Fund
798     created in Section 72-2-121; and
799          (B) 50% of the revenue from a sales and use tax imposed under this section in a county
800     of the first class shall be transferred to the Transit Transportation Investment Fund created in

801     Subsection 72-2-124(9).
802          (c) (i) If a county that is not a county of the first class for which the entire boundary of
803     the county is annexed into a large public transit district imposes a sales and use tax described in
804     this section, for a three-year period following the date on which the county imposes the sales
805     and use tax under this section, revenue designated for public transit as described in Subsection
806     (5)(a) shall be transferred to the relevant county legislative body to be used for a purpose
807     described in Subsection (11)(a).
808          (ii) If a county that is not a county of the first class for which the entire boundary of the
809     county is annexed into a large public transit district imposes a sales and use tax described in
810     this section, beginning on the day three years after the date on which the county imposed the
811     tax as described in Subsection (11)(c)(i), for the revenue that is designated for public transit in
812     Subsection (5)(a):
813          (A) 50% shall be transferred to the Transit Transportation Investment Fund created in
814     Subsection 72-2-124(9); and
815          (B) 50% shall be transferred to the relevant county legislative body to be used for a
816     purpose described in Subsection (11)(a).
817          (d) Except as provided in Subsection (12)(c), for a county that imposes a sales and use
818     tax under this section, for revenue designated for public transit as described in Subsection
819     (6)(b)(i), the revenue shall be transferred to the relevant county legislative body to be used for a
820     purpose described in Subsection (11)(a).
821          (12) (a) Notwithstanding Section 59-12-2208, a county legislative body may, but is not
822     required to, submit an opinion question to the county's registered voters in accordance with
823     Section 59-12-2208 to impose a sales and use tax under this section.
824          (b) If a county passes an ordinance to impose a sales and use tax as described in this
825     section, the sales and use tax shall take effect on the first day of the calendar quarter after a
826     90-day period that begins on the date the commission receives written notice from the county
827     of the passage of the ordinance.
828          (c) A county that imposed the local option sales and use tax described in this section
829     before January 1, 2023, may maintain that county's distribution allocation in place as of
830     January 1, 2023.
831          (13) (a) Revenue collected from a sales and use tax under this section may not be used

832     to supplant existing General Fund appropriations that a county, city, or town budgeted for
833     transportation or public transit as of the date the tax becomes effective for a county, city, or
834     town.
835          (b) The limitation under Subsection (13)(a) does not apply to a designated
836     transportation or public transit capital or reserve account a county, city, or town established
837     before the date the tax becomes effective.
838          Section 8. Section 72-1-303 is amended to read:
839          72-1-303. Duties of commission.
840          (1) The commission has the following duties:
841          (a) determining priorities and funding levels of projects and programs in the state
842     transportation systems and the capital development of new public transit facilities for each
843     fiscal year based on project lists compiled by the department and taking into consideration the
844     strategic initiatives described in Section 72-1-211;
845          (b) determining additions and deletions to state highways under Chapter 4, Designation
846     of State Highways Act;
847          (c) holding public meetings and otherwise providing for public input in transportation
848     matters;
849          (d) making policies and rules in accordance with Title 63G, Chapter 3, Utah
850     Administrative Rulemaking Act, necessary to perform the commission's duties described under
851     this section;
852          (e) in accordance with Section 63G-4-301, reviewing orders issued by the executive
853     director in adjudicative proceedings held in accordance with Title 63G, Chapter 4,
854     Administrative Procedures Act;
855          (f) advising the department on state transportation systems policy;
856          (g) approving settlement agreements of condemnation cases subject to Section
857     63G-10-401;
858          (h) in accordance with Section 17B-2a-807, appointing a commissioner to serve as a
859     nonvoting member or a voting member on the board of trustees of a public transit district;
860          (i) in accordance with Section 17B-2a-808, reviewing, at least annually, the short-term
861     and long-range public transit plans; [and]
862          (j) determining the priorities and funding levels of public transit innovation grants, as

863     defined in Section 72-2-301;
864          [(j)] (k) reviewing administrative rules made, substantively amended, or repealed by
865     the department[.]; and
866          (2) (a) For projects prioritized with funding provided under Sections 72-2-124 and
867     72-2-125, the commission shall annually report to a committee designated by the Legislative
868     Management Committee:
869          (i) a prioritized list of the new transportation capacity projects in the state
870     transportation system and the funding levels available for those projects; and
871          (ii) the unfunded highway construction and maintenance needs within the state.
872          (b) The committee designated by the Legislative Management Committee under
873     Subsection (2)(a) shall:
874          (i) review the list reported by the Transportation Commission; and
875          (ii) make a recommendation to the Legislature on:
876          (A) the amount of additional funding to allocate to transportation; and
877          (B) the source of revenue for the additional funding allocation under Subsection
878     (2)(b)(ii)(A).
879          (3) The commission shall review and may approve plans for the construction of a
880     highway facility over sovereign lakebed lands in accordance with Chapter 6, Part 3, Approval
881     of Highway Facilities on Sovereign Lands Act.
882          (4) One or more associations representing airport operators or pilots in the state shall
883     annually report to the commission recommended airport improvement projects and any other
884     information related to the associations' expertise and relevant to the commission's duties.
885          Section 9. Section 72-2-121 is amended to read:
886          72-2-121. County of the First Class Highway Projects Fund.
887          (1) There is created a special revenue fund within the Transportation Fund known as
888     the "County of the First Class Highway Projects Fund."
889          (2) The fund consists of money generated from the following revenue sources:
890          (a) any voluntary contributions received for new construction, major renovations, and
891     improvements to highways within a county of the first class;
892          (b) the portion of the sales and use tax described in Subsection 59-12-2214(3)(b)
893     deposited into or transferred to the fund;

894          (c) the portion of the sales and use tax described in Section 59-12-2217 deposited into
895     or transferred to the fund;
896          (d) a portion of the local option highway construction and transportation corridor
897     preservation fee imposed in a county of the first class under Section 41-1a-1222 deposited into
898     or transferred to the fund; and
899          (e) the portion of the sales and use tax transferred into the fund as described in
900     Subsections 59-12-2220(4)(a) and 59-12-2220(11)(b).
901          (3) (a) The fund shall earn interest.
902          (b) All interest earned on fund money shall be deposited into the fund.
903          (4) Subject to Subsection [(9)] (10), the executive director shall use the fund money
904     only:
905          (a) to pay debt service and bond issuance costs for bonds issued under Sections
906     63B-16-102, 63B-18-402, and 63B-27-102;
907          (b) for right-of-way acquisition, new construction, major renovations, and
908     improvements to highways within a county of the first class and to pay any debt service and
909     bond issuance costs related to those projects, including improvements to a highway located
910     within a municipality in a county of the first class where the municipality is located within the
911     boundaries of more than a single county;
912          (c) for the construction, acquisition, use, maintenance, or operation of:
913          (i) an active transportation facility for nonmotorized vehicles;
914          (ii) multimodal transportation that connects an origin with a destination; or
915          (iii) a facility that may include a:
916          (A) pedestrian or nonmotorized vehicle trail;
917          (B) nonmotorized vehicle storage facility;
918          (C) pedestrian or vehicle bridge; or
919          (D) vehicle parking lot or parking structure;
920          (d) to transfer to the 2010 Salt Lake County Revenue Bond Sinking Fund created by
921     Section 72-2-121.3 the amount required in Subsection 72-2-121.3(4)(c) minus the amounts
922     transferred in accordance with Subsection 72-2-124(4)(a)(iv);
923          (e) for a fiscal year beginning on or after July 1, 2013, to pay debt service and bond
924     issuance costs for $30,000,000 of the bonds issued under Section 63B-18-401 for the projects

925     described in Subsection 63B-18-401(4)(a);
926          (f) for a fiscal year beginning on or after July 1, 2013, and after the department has
927     verified that the amount required under Subsection 72-2-121.3(4)(c) is available in the fund, to
928     transfer an amount equal to 50% of the revenue generated by the local option highway
929     construction and transportation corridor preservation fee imposed under Section 41-1a-1222 in
930     a county of the first class:
931          (i) to the legislative body of a county of the first class; and
932          (ii) to be used by a county of the first class for:
933          (A) highway construction, reconstruction, or maintenance projects; or
934          (B) the enforcement of state motor vehicle and traffic laws;
935          (g) for a fiscal year beginning on or after July 1, 2015, after the department has verified
936     that the amount required under Subsection 72-2-121.3(4)(c) is available in the fund and the
937     transfer under Subsection (4)(e) has been made, to annually transfer an amount of the sales and
938     use tax revenue imposed in a county of the first class and deposited into the fund in accordance
939     with Subsection 59-12-2214(3)(b) equal to an amount needed to cover the debt to:
940          (i) the appropriate debt service or sinking fund for the repayment of bonds issued under
941     Section 63B-27-102; and
942          (ii) the appropriate debt service or sinking fund for the repayment of bonds issued
943     under Sections 63B-31-102 and 63B-31-103;
944          (h) after the department has verified that the amount required under Subsection
945     72-2-121.3(4)(c) is available in the fund and after the transfer under Subsection (4)(d), the
946     payment under Subsection (4)(e), and the transfer under Subsection (4)(g)(i) has been made, to
947     annually transfer $2,000,000 to a public transit district in a county of the first class to fund a
948     system for public transit;
949          (i) for a fiscal year beginning on or after July 1, 2018, after the department has verified
950     that the amount required under Subsection 72-2-121.3(4)(c) is available in the fund and after
951     the transfer under Subsection (4)(d), the payment under Subsection (4)(e), and the transfer
952     under Subsection (4)(g)(i) has been made, to annually transfer 20% of the amount deposited
953     into the fund under Subsection (2)(b):
954          (i) to the legislative body of a county of the first class; and
955          (ii) to fund parking facilities in a county of the first class that facilitate significant

956     economic development and recreation and tourism within the state;
957          (j) for the 2018-19 fiscal year only, after the department has verified that the amount
958     required under Subsection 72-2-121.3(4)(c) is available in the fund and after the transfer under
959     Subsection (4)(d), the payment under Subsection (4)(e), and the transfers under Subsections
960     (4)(g), (h), and (i) have been made, to transfer $12,000,000 to the department to distribute for
961     the following projects:
962          (i) $2,000,000 to West Valley City for highway improvement to 4100 South;
963          (ii) $1,000,000 to Herriman for highway improvements to Herriman Boulevard from
964     6800 West to 7300 West;
965          (iii) $1,100,000 to South Jordan for highway improvements to Grandville Avenue;
966          (iv) $1,800,000 to Riverton for highway improvements to Old Liberty Way from 13400
967     South to 13200 South;
968          (v) $1,000,000 to Murray City for highway improvements to 5600 South from State
969     Street to Van Winkle;
970          (vi) $1,000,000 to Draper for highway improvements to Lone Peak Parkway from
971     11400 South to 12300 South;
972          (vii) $1,000,000 to Sandy City for right-of-way acquisition for Monroe Street;
973          (viii) $900,000 to South Jordan City for right-of-way acquisition and improvements to
974     10200 South from 2700 West to 3200 West;
975          (ix) $1,000,000 to West Jordan for highway improvements to 8600 South near
976     Mountain View Corridor;
977          (x) $700,000 to South Jordan right-of-way improvements to 10550 South; and
978          (xi) $500,000 to Salt Lake County for highway improvements to 2650 South from
979     7200 West to 8000 West; and
980          (k) subject to Subsection (5), for a fiscal year beginning on or after July 1, 2021, and
981     for 15 years thereafter, to annually transfer the following amounts to the following cities, metro
982     townships, and the county of the first class for priority projects to mitigate congestion and
983     improve transportation safety:
984          (i) $2,000,000 to Sandy;
985          (ii) $2,000,000 to Taylorsville;
986          (iii) $1,100,000 to Salt Lake City;

987          (iv) $1,100,000 to West Jordan;
988          (v) $1,100,000 to West Valley City;
989          (vi) $800,000 to Herriman;
990          (vii) $700,000 to Draper;
991          (viii) $700,000 to Riverton;
992          (ix) $700,000 to South Jordan;
993          (x) $500,000 to Bluffdale;
994          (xi) $500,000 to Midvale;
995          (xii) $500,000 to Millcreek;
996          (xiii) $500,000 to Murray;
997          (xiv) $400,000 to Cottonwood Heights; and
998          (xv) $300,000 to Holladay.
999          (5) (a) If revenue in the fund is insufficient to satisfy all of the transfers described in
1000     Subsection (4)(k), the executive director shall proportionately reduce the amounts transferred
1001     as described in Subsection (4)(k).
1002          (b) A local government entity, as that term is defined in Section 63J-1-220, is exempt
1003     from entering into an agreement as described in Section 63J-1-220 pertaining to the receipt or
1004     expenditure of any funding described in Subsection (4)(k).
1005          (c) A local government may not use revenue described in Subsection (4)(k) to supplant
1006     existing class B or class C road funds that a local government has budgeted for transportation
1007     projects.
1008          (d) (i) A municipality or county that received a transfer of funds described in
1009     Subsection (4)(j) shall submit to the department a statement of cash flow and progress
1010     pertaining to the municipality's or county's respective project described in Subsection (4)(j).
1011          (ii) After the department is satisfied that the municipality or county described in
1012     Subsection (4)(j) has made substantial progress and the expenditure of funds is programmed
1013     and imminent, the department may transfer to the same municipality or county the respective
1014     amounts described in Subsection (4)(k).
1015          (6) The revenues described in Subsections (2)(b), (c), and (d) that are deposited into the
1016     fund and bond proceeds from bonds issued under Sections 63B-16-102, 63B-18-402, and
1017     63B-27-102 are considered a local matching contribution for the purposes described under

1018     Section 72-2-123.
1019          (7) The department may expend up to $3,000,000 of revenue deposited into the
1020     account as described Subsection 59-12-2220(11)(b) for public transit innovation grants, as
1021     provided in Part 3, Public Transit Innovation Grants.
1022          [(7)] (8) The additional administrative costs of the department to administer this fund
1023     shall be paid from money in the fund.
1024          [(8)] (9) Subject to Subsection [(9)] (10), and notwithstanding any statutory or other
1025     restrictions on the use or expenditure of the revenue sources deposited into this fund, the
1026     Department of Transportation may use the money in this fund for any of the purposes detailed
1027     in Subsection (4).
1028          [(9)] (10) Any revenue deposited into the fund as described in Subsection (2)(e) shall
1029     be used to provide funding or loans for public transit projects, operations, and supporting
1030     infrastructure in the county of the first class.
1031          Section 10. Section 72-2-124 is amended to read:
1032          72-2-124. Transportation Investment Fund of 2005.
1033          (1) There is created a capital projects fund entitled the Transportation Investment Fund
1034     of 2005.
1035          (2) The fund consists of money generated from the following sources:
1036          (a) any voluntary contributions received for the maintenance, construction,
1037     reconstruction, or renovation of state and federal highways;
1038          (b) appropriations made to the fund by the Legislature;
1039          (c) registration fees designated under Section 41-1a-1201;
1040          (d) the sales and use tax revenues deposited into the fund in accordance with Section
1041     59-12-103; and
1042          (e) revenues transferred to the fund in accordance with Section 72-2-106.
1043          (3) (a) The fund shall earn interest.
1044          (b) All interest earned on fund money shall be deposited into the fund.
1045          (4) (a) Except as provided in Subsection (4)(b), the executive director may only use
1046     fund money to pay:
1047          (i) the costs of maintenance, construction, reconstruction, or renovation to state and
1048     federal highways prioritized by the Transportation Commission through the prioritization

1049     process for new transportation capacity projects adopted under Section 72-1-304;
1050          (ii) the costs of maintenance, construction, reconstruction, or renovation to the highway
1051     projects described in Subsections 63B-18-401(2), (3), and (4);
1052          (iii) principal, interest, and issuance costs of bonds authorized by Section 63B-18-401
1053     minus the costs paid from the County of the First Class Highway Projects Fund in accordance
1054     with Subsection 72-2-121(4)(e);
1055          (iv) for a fiscal year beginning on or after July 1, 2013, to transfer to the 2010 Salt
1056     Lake County Revenue Bond Sinking Fund created by Section 72-2-121.3 the amount certified
1057     by Salt Lake County in accordance with Subsection 72-2-121.3(4)(c) as necessary to pay the
1058     debt service on $30,000,000 of the revenue bonds issued by Salt Lake County;
1059          (v) principal, interest, and issuance costs of bonds authorized by Section 63B-16-101
1060     for projects prioritized in accordance with Section 72-2-125;
1061          (vi) all highway general obligation bonds that are intended to be paid from revenues in
1062     the Centennial Highway Fund created by Section 72-2-118;
1063          (vii) for fiscal year 2015-16 only, to transfer $25,000,000 to the County of the First
1064     Class Highway Projects Fund created in Section 72-2-121 to be used for the purposes described
1065     in Section 72-2-121;
1066          (viii) if a political subdivision provides a contribution equal to or greater than 40% of
1067     the costs needed for construction, reconstruction, or renovation of paved pedestrian or paved
1068     nonmotorized transportation for projects that:
1069          (A) mitigate traffic congestion on the state highway system;
1070          (B) are part of an active transportation plan approved by the department; and
1071          (C) are prioritized by the commission through the prioritization process for new
1072     transportation capacity projects adopted under Section 72-1-304;
1073          (ix) $705,000,000 for the costs of right-of-way acquisition, construction,
1074     reconstruction, or renovation of or improvement to the following projects:
1075          (A) the connector road between Main Street and 1600 North in the city of Vineyard;
1076          (B) Geneva Road from University Parkway to 1800 South;
1077          (C) the SR-97 interchange at 5600 South on I-15;
1078          (D) two lanes on U-111 from Herriman Parkway to 11800 South;
1079          (E) widening I-15 between mileposts 10 and 13 and the interchange at milepost 11;

1080          (F) improvements to 1600 North in Orem from 1200 West to State Street;
1081          (G) widening I-15 between mileposts 6 and 8;
1082          (H) widening 1600 South from Main Street in the city of Spanish Fork to SR-51;
1083          (I) widening US 6 from Sheep Creek to Mill Fork between mileposts 195 and 197 in
1084     Spanish Fork Canyon;
1085          (J) I-15 northbound between mileposts 43 and 56;
1086          (K) a passing lane on SR-132 between mileposts 41.1 and 43.7 between mileposts 43
1087     and 45.1;
1088          (L) east Zion SR-9 improvements;
1089          (M) Toquerville Parkway;
1090          (N) an environmental study on Foothill Boulevard in the city of Saratoga Springs;
1091          (O) using funds allocated in this Subsection (4)(a)(ix), and other sources of funds, for
1092     construction of an interchange on Bangerter Highway at 13400 South; and
1093          (P) an environmental impact study for Kimball Junction in Summit County; and
1094          (x) $28,000,000 as pass-through funds, to be distributed as necessary to pay project
1095     costs based upon a statement of cash flow that the local jurisdiction where the project is located
1096     provides to the department demonstrating the need for money for the project, for the following
1097     projects in the following amounts:
1098          (A) $5,000,000 for Payson Main Street repair and replacement;
1099          (B) $8,000,000 for a Bluffdale 14600 South railroad bypass;
1100          (C) $5,000,000 for improvements to 4700 South in Taylorsville; and
1101          (D) $10,000,000 for improvements to the west side frontage roads adjacent to U.S. 40
1102     between mile markers 7 and 10.
1103          (b) The executive director may use fund money to exchange for an equal or greater
1104     amount of federal transportation funds to be used as provided in Subsection (4)(a).
1105          (5) (a) Except as provided in Subsection (5)(b), if the department receives a notice of
1106     ineligibility for a municipality as described in Subsection 10-9a-408(7), the executive director
1107     may not program fund money to a project prioritized by the commission under Section
1108     72-1-304, including fund money from the Transit Transportation Investment Fund, within the
1109     boundaries of the municipality until the department receives notification from the Housing and
1110     Community Development Division within the Department of Workforce Services that

1111     ineligibility under this Subsection (5) no longer applies to the municipality.
1112          (b) Within the boundaries of a municipality described in Subsection (5)(a), the
1113     executive director:
1114          (i) may program fund money in accordance with Subsection (4)(a) for a limited-access
1115     facility or interchange connecting limited-access facilities;
1116          (ii) may not program fund money for the construction, reconstruction, or renovation of
1117     an interchange on a limited-access facility;
1118          (iii) may program Transit Transportation Investment Fund money for a
1119     multi-community fixed guideway public transportation project; and
1120          (iv) may not program Transit Transportation Investment Fund money for the
1121     construction, reconstruction, or renovation of a station that is part of a fixed guideway public
1122     transportation project.
1123          (c) Subsections (5)(a) and (b) do not apply to a project programmed by the executive
1124     director before July 1, 2022, for projects prioritized by the commission under Section
1125     72-1-304.
1126          (6) (a) Except as provided in Subsection (6)(b), if the department receives a notice of
1127     ineligibility for a county as described in Subsection 17-27a-408(7), the executive director may
1128     not program fund money to a project prioritized by the commission under Section 72-1-304,
1129     including fund money from the Transit Transportation Investment Fund, within the boundaries
1130     of the unincorporated area of the county until the department receives notification from the
1131     Housing and Community Development Division within the Department of Workforce Services
1132     that ineligibility under this Subsection (6) no longer applies to the county.
1133          (b) Within the boundaries of the unincorporated area of a county described in
1134     Subsection (6)(a), the executive director:
1135          (i) may program fund money in accordance with Subsection (4)(a) for a limited-access
1136     facility to a project prioritized by the commission under Section 72-1-304;
1137          (ii) may not program fund money for the construction, reconstruction, or renovation of
1138     an interchange on a limited-access facility;
1139          (iii) may program Transit Transportation Investment Fund money for a
1140     multi-community fixed guideway public transportation project; and
1141          (iv) may not program Transit Transportation Investment Fund money for the

1142     construction, reconstruction, or renovation of a station that is part of a fixed guideway public
1143     transportation project.
1144          (c) Subsections (6)(a) and (b) do not apply to a project programmed by the executive
1145     director before July 1, 2022, for projects prioritized by the commission under Section
1146     72-1-304.
1147          (7) (a) Before bonds authorized by Section 63B-18-401 or 63B-27-101 may be issued
1148     in any fiscal year, the department and the commission shall appear before the Executive
1149     Appropriations Committee of the Legislature and present the amount of bond proceeds that the
1150     department needs to provide funding for the projects identified in Subsections 63B-18-401(2),
1151     (3), and (4) or Subsection 63B-27-101(2) for the current or next fiscal year.
1152          (b) The Executive Appropriations Committee of the Legislature shall review and
1153     comment on the amount of bond proceeds needed to fund the projects.
1154          (8) The Division of Finance shall, from money deposited into the fund, transfer the
1155     amount of funds necessary to pay principal, interest, and issuance costs of bonds authorized by
1156     Section 63B-18-401 or 63B-27-101 in the current fiscal year to the appropriate debt service or
1157     sinking fund.
1158          (9) (a) There is created in the Transportation Investment Fund of 2005 the Transit
1159     Transportation Investment Fund.
1160          (b) The fund shall be funded by:
1161          (i) contributions deposited into the fund in accordance with Section 59-12-103;
1162          (ii) appropriations into the account by the Legislature;
1163          (iii) deposits of sales and use tax increment related to a housing and transit
1164     reinvestment zone as described in Section 63N-3-610;
1165          (iv) transfers of local option sales and use tax revenue as described in Subsection
1166     59-12-2220(11)(b) or (c);
1167          (v) private contributions; and
1168          (vi) donations or grants from public or private entities.
1169          (c) (i) The fund shall earn interest.
1170          (ii) All interest earned on fund money shall be deposited into the fund.
1171          (d) Subject to Subsection (9)(e), the commission may prioritize money from the fund:
1172          (i) for public transit capital development of new capacity projects and fixed guideway

1173     capital development projects to be used as prioritized by the commission through the
1174     prioritization process adopted under Section 72-1-304; or
1175          (ii) to the department for oversight of a fixed guideway capital development project for
1176     which the department has responsibility.
1177          (e) (i) Subject to Subsections (9)(g) and (h), the commission may only prioritize money
1178     from the fund for a public transit capital development project or pedestrian or nonmotorized
1179     transportation project that provides connection to the public transit system if the public transit
1180     district or political subdivision provides funds of equal to or greater than 30% of the costs
1181     needed for the project.
1182          (ii) A public transit district or political subdivision may use money derived from a loan
1183     granted pursuant to Title 72, Chapter 2, Part 2, State Infrastructure Bank Fund, to provide all or
1184     part of the 30% requirement described in Subsection (9)(e)(i) if:
1185          (A) the loan is approved by the commission as required in Title 72, Chapter 2, Part 2,
1186     State Infrastructure Bank Fund; and
1187          (B) the proposed capital project has been prioritized by the commission pursuant to
1188     Section 72-1-303.
1189          (f) Before July 1, 2022, the department and a large public transit district shall enter into
1190     an agreement for a large public transit district to pay the department $5,000,000 per year for 15
1191     years to be used to facilitate the purchase of zero emissions or low emissions rail engines and
1192     trainsets for regional public transit rail systems.
1193          (g) For any revenue transferred into the fund pursuant to Subsection
1194     59-12-2220(11)(b):
1195          (i) the commission may prioritize money from the fund for public transit projects,
1196     operations, or maintenance within the county of the first class; and
1197          (ii) Subsection (9)(e) does not apply.
1198          (h) For any revenue transferred into the fund pursuant to Subsection
1199     59-12-2220(11)(c):
1200          (i) the commission may prioritize public transit projects, operations, or maintenance in
1201     the county from which the revenue was generated; and
1202          (ii) Subsection (9)(e) does not apply.
1203          (i) In accordance with Part 3, Public Transit Innovation Grants, the commission may

1204     prioritize money from the fund for public transit innovation grants, as defined in Section
1205     72-2-301, for public transit capital development projects requested by a political subdivision
1206     within a public transit district.
1207          (10) (a) There is created in the Transportation Investment Fund of 2005 the
1208     Cottonwood Canyons Transportation Investment Fund.
1209          (b) The fund shall be funded by:
1210          (i) money deposited into the fund in accordance with Section 59-12-103;
1211          (ii) appropriations into the account by the Legislature;
1212          (iii) private contributions; and
1213          (iv) donations or grants from public or private entities.
1214          (c) (i) The fund shall earn interest.
1215          (ii) All interest earned on fund money shall be deposited into the fund.
1216          (d) The Legislature may appropriate money from the fund for public transit or
1217     transportation projects in the Cottonwood Canyons of Salt Lake County.
1218          (11) (a) There is created in the Transportation Investment Fund of 2005 the Active
1219     Transportation Investment Fund.
1220          (b) The fund shall be funded by:
1221          (i) money deposited into the fund in accordance with Section 59-12-103;
1222          (ii) appropriations into the account by the Legislature; and
1223          (iii) donations or grants from public or private entities.
1224          (c) (i) The fund shall earn interest.
1225          (ii) All interest earned on fund money shall be deposited into the fund.
1226          (d) The executive director may only use fund money to pay the costs needed for:
1227          (i) the planning, design, construction, maintenance, reconstruction, or renovation of
1228     paved pedestrian or paved nonmotorized trail projects that:
1229          (A) are prioritized by the commission through the prioritization process for new
1230     transportation capacity projects adopted under Section 72-1-304;
1231          (B) serve a regional purpose; and
1232          (C) are part of an active transportation plan approved by the department or the plan
1233     described in Subsection (11)(d)(ii);
1234          (ii) the development of a plan for a statewide network of paved pedestrian or paved

1235     nonmotorized trails that serve a regional purpose; and
1236          (iii) the administration of the fund, including staff and overhead costs.
1237          Section 11. Section 72-2-301 is enacted to read:
1238     
Part 3. Public Transit Innovation Grants

1239          72-2-301. Definitions.
1240          As used in this part:
1241          (1) "Council of governments" means the same as that term is defined in Section
1242     17B-2a-802.
1243          (2) "Grant" means a public transit innovation grant.
1244          (3) "High growth area" means an area or municipality within a public transit district
1245     that:
1246          (a) has significantly higher population increase relative to other areas within the
1247     county; and
1248          (b) is projected to continue to have significant population growth.
1249          (4) "Public transit district" means the same as that term is defined in Section
1250     17B-2a-802.
1251          (5) (a) "Public transit innovation grant" means a grant to provide targeted pilot
1252     programs to:
1253          (i) increase public transit ridership;
1254          (ii) increase public transit service in high-growth areas within the public transit district;
1255     and
1256          (iii) work toward expanding public transit services.
1257          (b) "Public transit innovation grant" includes a grant to provide:
1258          (i) pilot bus routes and services in high-growth areas;
1259          (ii) pilot shuttle connections between fixed guideway stations and job centers,
1260     recreation and cultural facilities and attractions, or schools; and
1261          (iii) other pilot programs similar to those described in Subsections (5)(b)(i) and (ii) as
1262     coordinated between the public transit district and political subdivisions within the public
1263     transit district.
1264          Section 12. Section 72-2-302 is enacted to read:
1265          72-2-302. Public transit innovation grant funding sources.

1266          (1) In accordance with Section 72-2-303, the commission, in coordination with the
1267     department, may rank, prioritize, and provide public transit innovation grants with money
1268     derived from the following sources:
1269          (a) certain local option sales and use tax revenue as described in Subsection
1270     59-12-2219(11)(b); and
1271          (b) revenue deposited in accordance with Subsection 59-12-2220(11) into the County
1272     of the First Class Highway Projects Fund created in Section 72-2-121.
1273          (2) In accordance with Section 72-2-124, the department may rank and prioritize public
1274     transit innovation grants for capital development to the commission, to be funded with money
1275     derived from the Transit Transportation Investment Fund as described in Subsection
1276     72-2-124(9).
1277          Section 13. Section 72-2-303 is enacted to read:
1278          72-2-303. Public transit innovation grants -- Administration.
1279          (1) The commission, in consultation with the department, relevant councils of
1280     governments, metropolitan planning organizations, and public transit districts, shall develop a
1281     process for the prioritization of grant proposals that includes:
1282          (a) instructions on making and submitting a grant proposal;
1283          (b) methodology for selecting grants; and
1284          (c) methodology for awarding grants.
1285          (2) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1286     commission shall make rules to establish the process described in Subsection (1) and as
1287     otherwise necessary to implement this part.
1288          (3) The department shall:
1289          (a) accept grant applications;
1290          (b) rank grant proposals based on the objectives and criteria established in this part;
1291     and
1292          (c) provide money to grant recipients as directed by the commission and in accordance
1293     with this part.
1294          (4) A municipality or a group of municipalities may submit a grant proposal to the
1295     department.
1296          (5) (a) A public transit innovation grant proposal shall include data, evidence, and

1297     information about:
1298          (i) how the project will advance the purposes and goals of a public transit innovation
1299     grant described in Subsection 72-2-301(5);
1300          (ii) how the proposed services will provide a direct public transit service benefit to the
1301     municipality or area;
1302          (iii) the proposed mode of public transit or purpose for the funding;
1303          (iv) the proposed operator of the service, including qualifications for any proposed
1304     operator that is not a public transit district;
1305          (v) any funds provided by the municipality or group of municipalities as part of the
1306     grant proposal;
1307          (vi) how the pilot service will improve ridership in the municipality or area; and
1308          (vii) any other information that the municipality or public transit district finds relevant.
1309          (b) A public transit innovation grant proposal may propose a term of up to three years.
1310          (c) A public transit innovation grant proposal shall include information regarding
1311     integration and coordination with existing public transit services.
1312          (6) In considering a public transit innovation grant proposal, the commission shall
1313     consider criteria including:
1314          (a) population growth within the municipality or area relative to other municipalities or
1315     areas within the same county;
1316          (b) how the proposal furthers the following objectives:
1317          (i) increasing public transit ridership in the area;
1318          (ii) improving connectivity for the first and last mile relative to other public transit
1319     services; and
1320          (iii) improving public transit connectivity in high-growth areas within the public transit
1321     district; and
1322          (c) any funds proposed to be invested by the municipality or public transit district as
1323     part of the grant proposal.
1324          (7) The grant proposal may allow for bids for a vendor or public transit district to
1325     provide or operate the proposed services.
1326          (8) Subject to available funding described in Subsection 72-2-302(1), the commission
1327     may award a public transit innovation grant to a recipient that the commission determines

1328     furthers the objectives described in Subsections (5) and (6).
1329          (9) (a) Subject to Subsection (9)(b), if the commission approves a grant to provide
1330     money from a local option sales and use tax described in Subsection 59-12-2219(11), a public
1331     transit district shall transfer the money to the department, and the department shall transfer the
1332     money to the grant recipient.
1333          (b) A public transit district may offset money from a local option sales and use tax
1334     described in Subsection 59-12-2219(11) with other funds available to the public transit district.
1335          (10) If the commission approves a grant to provide money as provided in Subsection
1336     72-2-121(7), the department shall transfer the money to the grant recipient.
1337          (11) Any grant funds, assets, or infrastructure acquired or improved through a public
1338     transit innovation grant under this part belong to the grant recipient.
1339          Section 14. Section 72-2-304 is enacted to read:
1340          72-2-304. Reporting.
1341          (1) At least annually, a recipient of a grant under this part shall provide a report to the
1342     department and the relevant public transit district.
1343          (2) The report described in Subsection (1) shall include:
1344          (a) the amount of money provided through the grant;
1345          (b) an accounting of how the grant money has been utilized;
1346          (c) the type of services provided;
1347          (d) coordination with existing public transit services;
1348          (e) ridership data relevant to the innovative public transit service, including:
1349          (i) the number of riders; and
1350          (ii) whether the ridership or targeted objectives match projections; and
1351          (f) other information as determined by the grant recipient.
1352          (3) The department shall consolidate the reports the department receives under
1353     Subsection (1) and, on or before November 1 of each year, provide the consolidated reports to
1354     the Transportation Interim Committee.
1355          (4) The department and the commission are not responsible for providing performance
1356     measures or ensuring proper use of grant funds.
1357          Section 15. Effective date.
1358          This bill takes effect on July 1, 2024.