FTA's $28.5M TOD Planning Pilot Returns With a Mandatory-Partnership Twist for FY2026

The Federal Transit Administration's Pilot Program for Transit-Oriented Development Planning has always been one of the most under-applied-for grant programs in the federal transportation portfolio. It pays cities and transit operators to do the land-use planning work that turns a $400 million light rail project into a coherent neighborhood instead of a row of park-and-ride lots. The math should be obvious — and yet roughly half of the program's appropriated dollars in recent cycles have gone unrequested, simply because eligible applicants did not know it existed or did not stitch together the required partnerships in time.

The FY2026 round, published May 11 under funding opportunity number FTA-2026-003-TPE-TODP, makes that gap harder to close. FTA has put $28,492,618 on the table for an expected 35 awards. Applications are due July 10, 2026, 11:59 p.m. ET via Grants.gov. And in a quiet but consequential shift, the agency has tightened eligibility in a way that screens out the casual entrants who diluted past rounds.

The eligibility filter you may have missed

Past TOD Planning NOFOs allowed any state, local government, metropolitan planning organization, or designated FTA recipient to apply on behalf of a fixed-guideway corridor. The FY2026 NOFO restricts eligibility to existing FTA grantees as of the NOFO publication date — meaning entities already in active grant relationships with FTA on May 11, 2026.

For most metropolitan transit operators this is a non-issue: they receive formula funds annually and qualify automatically. But the change does two real things. First, it cuts out greenfield applicants — counties and special districts that have never received an FTA grant and were eyeing the program as an entry point. Second, it pushes those non-grantee land-use partners to apply through an eligible grantee as a sub-recipient, which is the structure FTA has long preferred but rarely enforced.

The second eligibility constraint is structural and explicit: every project must connect to a new fixed guideway or core capacity improvement project under Section 5309(a) of Title 49. That means light rail, heavy rail, commuter rail, bus rapid transit on a dedicated guideway, streetcar, ferry, or a Capital Investment Grant Program (CIG) core capacity project. Generic land-use planning that is merely "transit-supportive" does not qualify. The corridor must point at a real, identifiable transit capital investment — either already in the CIG pipeline or credibly headed there.

The mandatory partnership and why it matters

The most consequential design choice in this NOFO is the partnership requirement. Applicants must either (a) be the project sponsor of the eligible transit capital project and the entity with land-use planning authority in the corridor, or (b) form a formal partnership between those two entity types. In American urban governance, those two functions almost never sit inside the same agency. Transit operators rarely control zoning; cities and counties rarely operate transit.

In practice this means the strongest FY2026 applications will pair a transit operator (lead grantee) with a city planning department, a metropolitan planning organization, or a county land-use authority — and document that partnership in writing through an executed memorandum of understanding submitted with the application. FTA has signaled it will treat unsigned partnership letters as a substantive weakness.

This requirement reflects what TOD planners have argued for two decades: that the failure mode of American transit investment is not engineering, but the disconnect between fixed-guideway construction and the land-use approvals needed to realize ridership and economic-development outcomes around stations. By forcing the partnership at the application stage, FTA is trying to engineer political alignment that has historically taken years to materialize after stations opened.

What the grants actually fund

Eligible activities under the FY2026 NOFO span both comprehensive corridor-wide planning and site-specific station-area planning. The published activity list includes:

• Economic-development and ridership-improvement analysis around stations
• Multimodal connectivity and accessibility planning, including last-mile networks
• Pedestrian and bicycle access improvements within station-area walksheds
• Private-sector engagement and public-private partnership feasibility
• Infrastructure-needs identification (water, sewer, sidewalks) to support mixed-use development
• Affordable-housing strategy integrated with land-use planning
• Equitable-TOD analysis addressing displacement risk in existing neighborhoods
• Zoning code analysis and rewrites to enable mixed-use development near transit

What the program does not fund is construction. These are planning dollars — they pay for staff time, consultant studies, community engagement, and the legal and policy work to enable downstream capital investment. Successful awardees typically use the funds to produce a station-area master plan, a corridor-wide TOD strategy, an affordable-housing preservation plan, or a zoning overlay that the local jurisdiction can adopt.

Award sizes and the math of 35 awards from $28.5 million

FTA has not published explicit minimum or maximum award sizes in the FY2026 NOFO, but the expected-award count combined with total funding implies an average award of roughly $814,000. In past TOD Planning rounds, awards have ranged from approximately $300,000 to $2 million, with the median landing around $700,000. A $1 million-plus award typically funds a multi-year corridor planning effort spanning four to eight stations; a $300,000 award typically funds a single station-area master plan or a focused technical analysis.

Cost sharing is required. FTA has historically required a 20% non-federal match, achievable through state planning funds, local general-fund commitments, in-kind staff time, or contributions from regional partners. The FY2026 NOFO continues this requirement, and applicants who exceed the 20% minimum gain modest scoring advantages.

Evaluation: the criteria that actually move scores

FTA's evaluation framework for TOD Planning has been consistent across cycles. Reviewers weight three core dimensions:

Project readiness and capacity — Has the applicant team identified the work plan, secured partnerships, allocated staff, and demonstrated the technical capacity to execute? Submissions that arrive with a scoped consultant team and an executed MOU consistently outperform those proposing to figure out partnerships post-award.

Alignment with statutory purposes — Does the planning work materially improve the case for the underlying transit capital investment? Reviewers look for explicit ridership and economic-impact projections, not generic "smart growth" language.

Equity and community engagement — How will the planning work address displacement risk, affordable housing, and meaningful community participation? The FY2026 NOFO retains equity as a scored criterion despite the broader federal pullback on diversity-focused language; the framing has shifted toward "community benefit" and "displacement mitigation" rather than explicit DEI terminology.

Strategic implications for the next three weeks

For applicants weighing whether to compete, four considerations matter:

First, the partnership requirement is binary. Either you can document a formal partnership by July 10 or you cannot. If you cannot, do not waste a submission slot — wait for FY2027.

Second, corridor-wide applications outperform single-station applications on a dollar-per-population basis. Reviewers respond to coherence across a transit investment, not to one-off station studies. Combining three to six station areas under a single corridor strategy is the sweet spot.

Third, affordable-housing integration is the differentiator. The FY2026 NOFO continues to emphasize anti-displacement planning, and successful applications increasingly partner with housing authorities or community development corporations. Applications without an affordable-housing strategy lose points to those that include one.

Fourth, the program is structurally underapplied for. With 35 expected awards and a tightly scoped eligibility universe, the competition density is dramatically lower than headline transportation programs like RAISE or Mega. Otherwise-qualified applicants who do the partnership work win at unusually high rates.

Why this NOFO matters more than its dollar volume suggests

Twenty-eight million dollars is a rounding error against the federal transportation budget. But TOD Planning dollars have outsized leverage: a $1 million planning grant routinely unlocks $400 million to $2 billion in downstream capital investment by clarifying ridership cases, securing local zoning changes, and aligning private development with public infrastructure.

For transit operators with CIG projects in the pipeline — particularly those competing for FTA's Small Starts, New Starts, or Core Capacity dollars — a TOD Planning award produces materials that strengthen the underlying CIG application in subsequent rounds. The two programs feed each other. Operators who skip TOD Planning often find themselves disadvantaged in CIG competition because their land-use case is thinner than peers who invested in this planning work.

The June 10 FTA webinar passed, but the recorded version remains available through FTA's notices-funding portal. Applicants still drafting should treat the recording as required viewing — FTA program staff used the session to clarify several scoring nuances that are not explicit in the written NOFO.