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MEMORANDUM OF UNDERSTANDING (MOU) <br />BETWEEN THE <br />CITY OF SAN MARCOS, TEXAS <br />AND <br />CAPITAL AREA RURAL TRANSPORTATION SYSTEM <br />REGARDING DISTRIBUTION OF CERTAIN CAPITAL FUNDING <br />FOR BUS PURCHASES <br />This Memorandum of Understanding (MOU) is a result of meeting and conferring with the <br />representatives of Federal Transit Administration Region VI staff that the City of San Marcos, <br />Texas ("City") and Capital Area Rural Transportation System ("CARTS") participated in on <br />August 12, 2019 to receive guidance and affirm transition arrangements for the assignment of <br />administrative responsibilities for the Federal Transit Administration (FTA) Section 5307 funding <br />for the San Marcos/Redwood Urbanized Area ("UZA") to the City of San Marcos. FTA staff <br />recommended we enter into a MOU with respect to the distribution of certain capital grant funds <br />as described in this document. <br />The terms and conditions set forth in this MOU have been discussed in good faith between the <br />City and CARTS. <br />This MOU commences on the effective date referenced in Section .5. Term. <br />Section 1. Background. In 2014 CARTS applied for and was assigned funding from a capital <br />grant in the amount of $2.1 Million Dollars to replace the fixed route bus fleet in the San <br />Marcos/Redwood UZA that was being re -branded for an October 2016 launch of new service, such <br />service being deployed per the tenets of 5 -year Comprehensive Transit Development Plan (TDP) <br />completed in 2014. <br />However the awarding agency, CAMPO, programmed the CARTS award of the grant funding for <br />its 2018 fiscal year. Repeated attempts to get the awarding agency to move the funding forward so <br />that the buses could be procured before the re -branding schedule were unsuccessful. Consequently, <br />CARTS obligated $1,581,318 in funds from an active FTA capital grant it held for its regional <br />interurban bus purchases to purchase the City's fixed route bus fleet so the fixed route bus service <br />could be re -branded and launched in a timely manner. <br />This was done with the understanding between City and CARTS representatives that the funding <br />advanced by CARTS for the fixed route bus purchases would be recouped and applied back to the <br />CARTS regional interurban bus fleet purchases necessary once the $2.1 Million FTA capital grant <br />was active and funded. <br />The CARTS Board of Directors passed a resolution that memorialized that understanding <br />Per that understanding CARTS has obligated itself for certain bus purchases for its regional <br />interurban fleet that will be delivered and invoiced after the October 1, 2019 transition date that <br />the City will assume Direct Recipient (DR) Status for the FTA Section 5307 funding for the UZA. <br />This MOU is intended to memorialize the understanding that the City will honor the invoices <br />received by CARTS for its purchases of the regional interurban fleet buses, and will process same <br />for payment from the particular Section 5307 capital funding grant (TX -2018-50) referenced <br />above. <br />Section 2. Obligations of the CiIX. The City agrees to pay from Section 5307 funding it receives <br />from the referenced FTA grant (TX -2018-50) on or after October 1, 2019 the invoices CARTS <br />