§ 427.13. Demonstration projects.

 When a local transportation organization or an agency or instrumentality of the Commonwealth applies to the Department for reimbursement of operating costs related to demonstration program projects, the project must meet the following criteria:

   (1)  A feasibility study must be conducted and a report issued prior to application. The feasibility report must include annual estimates for the four performance criteria identified in section 1513(f) of the act (relating to operating program) for the determination of the success of the demonstration project.

   (2)  The Department must approve minimum performance standards for the demonstration project.

   (3)  The applicant shall provide documentation of local acceptance of the established minimum performance standards. The local acceptance document must indicate that the applicant and the local funding entity understand that:

     (i)   If the demonstration service meets the established minimum performance standards within the 3-year demonstration period, it may receive formula based operating assistance from section 1513 of the act funds if there is sufficient funding available in section 1513 of the act to fund both existing services and the demonstration project.

     (ii)   If the demonstration project fails to meet the minimum performance standards within the 3-year period, the service is ineligible for State Section 1513 operating assistance.

       (A)   The applicant or the local funding entity may elect to continue the service and provide all required operating assistance.

       (B)   The applicant or the local funding entity, or both, may elect to discontinue the service and notify all affected parties of the decision and take responsibility for that decision.

   (4)  The applicant shall demonstrate the support of the local funding entity providing local matching funds for the demonstration project and accepting responsibility for decisions made with regard to continuation/discontinuation of service by issuing the following resolutions:

     (i)   A resolution certifying that sufficient local funds will be made available based on a 5-year annual projection of operating budgets and funding sources.

     (ii)   A resolution acknowledging that the applicant and the local funding entity are responsible for determining continuation of service prior to the end of the 3-year demonstration period.

   (5)  During the 3-year demonstration period, the local matching funds must equal at least 15% of the State demonstration grant.

   (6)  Within 30 days of the end of each quarter, the applicant shall submit quarterly reports providing financial information and operating statistics in a format determined by the Department within 30 days of the end of each quarter during the 3-year demonstration period to maintain eligibility for State funding.



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