Governmentwide requirements in 2 CFR 200 require that recipients use equipment purchased with Federal funds for its intended purpose and avoid the acquisition of unnecessary or duplicative items.  In this case transit rolling stock (vehicles) are required to be used to provide public transportation services.  FTA recognizes that transit agency operations require some number of spare vehicles in the event of breakdowns, for maintenance needs, or for a temporary surge in operations. FTA’s spare ratio policy therefore permits recipients to use federal funds to acquire a reasonable number of spare vehicles based on operational needs.

Spare ratio is defined as the total number of spare vehicles (also known as rolling stock) available for fixed-route service (regardless of type) divided by the total number of fixed-route vehicles required for annual maximum service (regardless of type). Spare ratio is usually expressed as a percentage, E.g., a system that requires 100 vehicles for maximum fixed-route service and keeps an additional 20 spare vehicles, for a total of 120 vehicles, has a 20 percent spare ratio. FTA calculates a separate spare ratio for rubber-tired vehicles and rail vehicles but does not calculate more specific spare ratios for vehicle types within those two categories. 

For purposes of the spare ratio calculation, “vehicles operated in maximum fixed-route service” is defined as the total number of revenue vehicles operated to meet the annual maximum service requirement. This is the revenue vehicle count during the peak week, day, and hours maximum service is provided. It excludes atypical days and special events. 

Bus/Van Fleet:

The basis for determining a reasonable spare bus/van ratio takes local circumstances into account. Generally, the number of spare buses/vans in the active fleet for recipients operating 50 or more fixed-route revenue vehicles should not exceed 20 percent of the number of vehicles operated in maximum fixed-route service. 

FTA does not set a specific spare ratio for operators of fewer than 50 fixed-route revenue vehicles, but expects the number of spare buses/vans to be reasonable, considering the number, variety, types, and sizes of vehicles. 

FTA does not include buses/vans delivered for future expansion or replaced buses/vans not yet disposed of in its calculation of spare ratio. 

Rail Fleet: 

FTA has not established a uniformly applicable spare ratio for rail transit operations because rail transit operations differ between recipients and are highly specialized. Nevertheless, rail operators should be aware that FTA will examine the recipient’s rationale for its rail vehicle spare ratio when the recipient purchases or rebuilds rail vehicles with FTA financial assistance and during triennial reviews. 

For further guidance about an appropriate rail fleet spare ratio please refer to Circular 5010.1F

FTA reviews a recipient’s spare ratio when it considers a grant application proposing to replace, rebuild, or acquire additional rolling stock (vehicles). 

The purpose of FTA’s spare ratio policy is to ensure that recipients do not use federal funds to acquire rolling stock until needed. FTA requires that a recipient justify its spare ratio when applying for federal funds to acquire or rebuild additional rolling stock. 

Notably, the policy does not require recipients to prematurely dispose of buses/vans prior to the end of the useful life in order to keep the spare ratio at or below 20 percent. Rather, the policy provides that recipients with a spare ratio higher than 20 percent justify the reason for the acquisition of new buses/vans at the time they submit a grant award application.

A recipient’s grant application to purchase additional rolling stock should address the current spare ratio, the spare ratio anticipated at the time the rolling stock is introduced into service, and the proposed disposition, if any, of existing rolling stock, including vehicle age and mileage. The recipient should notify FTA if the recipient significantly alters the spare ratio computation between the time of the submission of the application and before the award is made.

No specific action is required if transit service is reduced after grant award, resulting in an increased number of spare rolling stock. FTA will consider any such spare rolling stock when examining future grant applications. However, if significant numbers of spare vehicles are no longer needed for its originally authorized purpose, then, like any excess grant-funded property, the recipient must request disposition instructions regarding those vehicles from its FTA regional office according to federal law and regulation. 

Recipients of buses/vans recently procured may temporarily exceed their spare ratio thresholds. In those cases, recipients may seek a short-term deviation from the spare ratio requirements.  In its grant application, the recipient should include a brief justification explaining the reason for the deviation and the recipient’s plan to return to compliance, including the date by which the spare ratio will comply with FTA policy. Generally, FTA will not grant a deviation exceeding a two-year period and must be approved by the FTA Regional Administrator for that Region either in writing or by approval of the grant award.

Recipients should promptly inform the FTA Regional Office of any significant changes to spare ratios, including plans for service reductions or expansions, disposition or acquisition of vehicles, or other changes in vehicle needs. 

If a recipient replaces its rolling stock (buses/vans/similar vehicles) with rolling stock of a new propulsion type, then the spare ratio is calculated off the needs of the new fleet. For example, if a recipient was previously operating 100 buses in maximum fixed route service, FTA’s spare ratio policy would expect 20 spares for a total of 120 buses. If the recipient now needs 110 buses operating in maximum fixed route service, FTA’s spare ratio policy would expect 22 spares, for a total of 132 buses. 

FTA permits recipients to retain buses/vans that have met their useful life in a contingency fleet without being included in the spare ratio calculation.  Recipients may retain contingency fleets for emergency use as well as for the introduction of zero emission vehicles. However, once a bus/van is no longer needed for the contingency fleet or other transit purpose, then the recipient must request disposition instructions from its FTA regional office and dispose of the bus/van according to federal law and regulation. 

Emergencies or other unforeseen activities could include the evacuation of people during an emergency, use as crowd control or traffic barriers, loaners to other transit agencies during a justified need, temporary replacements for buses in the active fleet during major active fleet overhauls or bus maintenance activities and other activities that take a portion of the active fleet temporarily out of service. 

As noted, contingency fleets are also expressly permitted for the introduction of zero emission vehicles.

Buses/vans stockpiled in a contingency fleet in preparation for emergencies must have met their minimum useful life requirements and must be properly stored, maintained, and documented in a contingency plan. Contingency plans are subject to review during triennial reviews and other FTA oversight reviews. Any bus/van not included in the contingency plan will be considered part of the active fleet.

Rolling Stock Spare Ratio policies for buses/vans or rail vehicles can be found in FTA Circular 5010, “Award Management Requirements.”