Rural Transit Solutions Fund: Frequently asked questions

Applicants must provide sufficient information in their application to enable Housing, Infrastructure and Communities Canada to review and assess each proposal according to the Rural Transit Solutions Fund's merit criteria. These criteria are essential for determining the application's alignment with the Fund's objectives. The merit criteria for both Rural Transit Solutions Fund's streams are outlined in the applicant guides, accessible under the Applicant Guides tab.

• No. Any projects underway, expenditures incurred and contracts signed before receiving federal approval, are not eligible for Rural Transit Solutions Fund funding. The only exception are costs related to Indigenous consultations which may be retroactively eligible dating back one year prior to the application’s submission date. These expenses are subject to approval by Housing, Infrastructure and Communities Canada.

• A tentative start date and timelines should be identified in your application. Any contracts signed before approval by the Minister of Housing, Infrastructure and Communities will not be eligible for a Rural Transit Solutions Fund grant (planning stream) or contribution (capital stream). Federal funding will be provided to the recipient only once a grant agreement (for planning projects) or a contribution agreement (for capital projects) is signed by both Housing, Infrastructure and Communities Canada, and the recipient.

• The Rural Transit Solutions Fund is intended to connect communities and support the day-to-day movement of local residents in communities to help them get to work, school, appointments and visit loved ones.
• The Rural Transit Solutions Fund addresses the unique transportation needs of Canada's rural and remote communities. In many rural areas, residents rely on regional travel to neighboring communities for their daily activities. The Fund supports projects that enhance transit within these regions. In more remote areas, such as Canada's North, residents often face the additional challenge of traveling over much greater distances.
• The Fund is not designed to support transit between major cities, across regions or provinces.

• No, not all communities are eligible for Rural Transit Solutions Fund funding. The Rural Transit Solution Fund supports transit projects in rural and small communities, including small towns and villages within a Census Metropolitan Area (CMA). For projects, serving communities with populations between 50,000 and 150,000 applicants must demonstrate how their project specifically targets their rural populations.
• Projects from applicants serving a population greater than 150,000 living mainly in the urban area of a CMA are not eligible for funding.

• No. Under the Rural Transit Solutions Fund, costs that are related to the ongoing operations, salaries, insurance, maintenance and/or electricity and fuel costs associated with the operations of capital assets are ineligible.

• There is no limit to the cost of a capital project, however, the maximum contribution from the Rural Transit Solutions Fund is $10 million for eligible organizations that have a minimum of two years of transit experience, including local governments working in partnership with experienced transit organizations, and/or has completed a public transit feasibility study dated on or after January 1, 2020. For eligible organizations with less than two years of transit experience or have not completed a public transit feasibility study, the maximum Rural Transit Solution Fund contribution is limited to $250,000.
• Housing, Infrastructure and Communities Canada may consider larger Rural Transit Solutions Fund projects with a contribution over $10 million if the project involves multiple regions and levels of governments. These projects will be considered on a case-by-case basis. Please contact the Rural Transit Solutions Fund to determine if this option is available to your organization.
• The Rural Transit Solutions Fund has a $10 million cumulative cap for applicants with multiple ongoing Rural Transit Solutions Fund projects at a given time. Once the cap is reached, the organization must complete previously approved projects before applying for additional funding.
• If a project is approved, a contribution agreement will establish the federal contribution amount and conditions for payments. Housing, Infrastructure and Communities Canada will not provide additional payment if the project costs go over budget (cost overruns ).

• No, applicants can apply to either stream and are not obligated to apply for both. An applicant can submit a Capital Projects stream application without having submitted a Rural Transit Solutions Fund Planning and Design Projects stream application.
• To qualify for a Rural Transit Solutions Fund contribution of $250,000 or more, an organization must either have experience managing a transit system or have recently completed a transit planning study (dated on or after January 1, 2020). This planning study does not need to be funded by the Rural Transit Solutions Fund but should analyze community characteristics such as geography, population, and economic conditions, and ensure that the proposed transit project is  realistic, scalable, and financially sustainable.

• Under the Rural Transit Solutions Fund, vehicles must be purchased and cannot be leased.

• Yes, an eligible organization can hire a private sector operator to manage and implement their transit service. The ownership of the assets purchased with Rural Transit Solutions Fund resources must remain with the eligible organization. However, it is important to note that operational expenses are not eligible under the Rural Transit Solutions Fund.

• Yes, funding can be used to enhance an existing transit service. Projects that improve access, safety, or user experience—such as the installation of a bus shelter—may be eligible as stand-alone initiatives. In these cases, applicants must demonstrate how the proposed asset enhancement will directly contribute to the overall transit service and benefit users. All projects will be evaluated based on the program's merit criteria to ensure alignment with its objectives.

• Active transportation infrastructure are eligible if they are part of a broader transit system or solution and support the accessible and safe access to the transit service. For projects consisting solely of active transportation components, please refer to the Active Transportation Fund's web page.

• The contribution agreement provided by Housing, Infrastructure and Communities Canada will require reporting throughout the completion of the project and a final report. Reporting requirements will include:
• Any changes to the project that would impact project outcomes
• Confirmation of expected and actual project start/end dates
• Reports related to procurement activities
• General description of project's achievements

• Applicants will be informed if their projects have been successful. If successful, the recipient will need to complete a grant agreement with Housing, Infrastructure and Communities Canada to receive the funding. Contracts signed prior to the project approval would not be eligible for funding.

• Yes. The grant agreement provided by Housing, Infrastructure and Communities Canada will require the completion of a final progress report.