Obligation and the Quest for the Golden Ticket

Successfully securing federal funds, or obligation, for a transportation project is like Charlie Bucket getting the golden ticket to visit Willy Wonka’s Candy Factory. 

Obligation refers to a local agency’s project successfully securing their portion of federal funds. This important step in the life of a project is very significant to transportation planners. Without federal obligation, the project cannot move through the multi-step process, which in the end results in the construction of projects that you see in our community April through November.

WATS tracks each local federal aid project beginning on October 1st of each year, this is when fiscal year funds from the federal government are made available to local agencies and they can “request obligation”. This tracking allows WATS staff to ensure that all projects selected by the WATS Policy Committee will have their portion of federal funds available when they are ready to build their project. The federal portion of transportation projects is usually 80% with local funds making up 20%. 

One example of a funding source that WATS actively monitors is the Ann Arbor urbanized area federal funds, also known as STPBG-Urban (Surface Transportation Block Grant). The urban area receives an allocation of approximately $5.6 million and local agencies have to match that with $1.4 million of local funds. This is a good return on investment by our local agencies!

As part of the obligation process, MPOs across the country are required to provide a list of the projects that were federally funded for that fiscal year, which runs October 1-September 30. For WATS, we show every federally funded project that was secured in the fiscal year to show the importance of projects built in the county. Check out our report of all federal funds spent in Washtenaw County at https://bit.ly/2Ke5KUq.