TO: Mayor and City Council
FROM: Philippe Eskandar, City Manager
BY: Amber Shah, Parks & Public Works Director
DATE: May 29, 2026
SUBJECT: APPROVE THE FULFILLMENT AGREEMENT FOR
UNPROGRAMMED SURFACE TRANSPORTATION
PROGRAM – LOCAL (STP-L) FUNDS WITH THE LOS
ANGELES COUNTY METROPOLITAN TRANSPORTATION
AUTHORITY AND AUTHORIZE THE CITY MANAGER TO
EXECUTE THE FULLFILLMENT AGREEMENT AND ANY
RELATED DOCUMENTS NECESSARY TO RECEIVE AND
ADMINISTER THE FUNDS
STRATEGIC PLAN CRITICAL SUCCESS FACTORS
Fiscally Responsible and Transparent City Government
Well-Maintained Infrastructure
BACKGROUND
Historically, and prior to July 1, 2023, local agencies in Los Angeles County received annual federal Surface Transportation Program–Local (STP-L) allocations from the Los Angeles County Metropolitan Transportation Authority (LACMTA) based on population. The STP-L program utilized federal Surface Transportation Block Grant (STBG) funds and provided local jurisdictions with flexible funding for eligible transportation and capital improvement projects.
In 2021 and 2022, the federal government issued Corrective Actions to Caltrans and the Southern California Association of Governments (SCAG), determining that the practice of distributing federal STBG and Congestion Mitigation & Air Quality (CMAQ) funds based on population did not comply with federal program requirements. Effective July 1, 2023, the Corrective Action prohibited the continued disbursement of STBG and CMAQ funds through the Tony Chou, Mayor
Calvin Lo, Vice Mayor
Hunter Chang, Council Member
John Chou, Council Member
Gretchen Shepherd Romey, Council Member
STP-L population-based allocation methodology.
As a result, the STP-L program was discontinued, and local agencies must now apply competitively for STBG and CMAQ funding through SCAG’s regional Call for Projects process, which occurs every odd-numbered year. In addition, the Corrective Action prevented agencies from programming and accessing their previously accumulated, unprogrammed STP-L balances through the Federal Transportation Improvement Program (FTIP).
To address the loss of access to these unprogrammed balances, the LACMTA Board of Directors approved the STP-L Fulfillment Program on April 24, 2025, utilizing Proposition C funds to reimburse local agencies for their unprogrammed STP-L balances. Under this action, the City of San Marino was allocated $108,421 in Proposition C funds to fulfill its unprogrammed STP-L balance.
The Fulfillment Program will occur over a three (3) year period during Fiscal Years 2025-26, 2026-27, and 2027-28, and will sunset on June 30, 2028.
Disbursement of Metro Proposition C funds will occur after a funding agreement is fully executed between LACMTA and the participating agency.
The City must enter into a Fulfillment Agreement with LACMTA in order to receive the allocated funds. City Council approval is required to authorize the City Manager to execute the agreement and any related documents necessary to receive and administer the funding.
DISCUSSION
The proposed Fulfillment Agreement establishes the terms and conditions governing the City’s receipt and use of the Proposition C fulfillment funds. The agreement provides $108,421 in Proposition C funding for eligible transportation-related activities consistent with LACMTA Proposition C Guidelines and the project scope identified by the City.
Under the agreement, the City will be required to:
• Use the funds for eligible transportation-related projects and activities • Submit quarterly progress and expenditure reports to LACMTA • Maintain appropriate accounting and financial records in accordance with Generally Accepted Accounting Principles (GAAP)
• Comply with all applicable procurement and audit requirements • Retain records related to the use of funds for a minimum of five (5) years The agreement also authorizes LACMTA to conduct financial and compliance audits to verify proper expenditure of funds. Any expenditure determined to be ineligible would be subject to reimbursement to LACMTA.
Staff anticipate utilizing the funds for the Annual Street Rehabilitation Program identified through the City’s Capital Improvement Program (CIP) and future budget processes. Approval of the proposed agreement will allow the City to access and program these funds in a timely manner prior to the June 30, 2028, sunset of the Fulfillment Program.
FISCAL IMPACT & PROCUREMENT REVIEW
Approval of the Fulfillment Agreement will provide the City with $108,421 in Proposition C funds from LACMTA to reimburse eligible transportation-related expenditures. No matching funds are required as part of this agreement.
Future appropriations and programming of the funds will be incorporated into the City’s annual budget and Capital Improvement Program, as applicable.
Any future procurement activities associated with eligible projects will be conducted in accordance with the City’s purchasing policies and applicable state and federal requirements.
LEGAL REVIEW
The City Attorney's office has reviewed and approved as to form.
RECOMMENDATION
Staff recommend the City Council 1) approve the Fulfillment Agreement for Unprogrammed Surface Transportation Program – Local (STP-L) Funds with the Los Angeles County Metropolitan Transportation Authority and 2) authorize the City Manager to execute the Fulfillment Agreement. If the City Council concurs with staff’s recommendation, an appropriate motion would be:
“I move to 1) approve the Fulfillment Agreement for Unprogrammed Surface Transportation Program – Local (STP-L) Funds with the Los Angeles County Metropolitan Transportation Authority and 2) authorize the City Manager to execute the Fulfillment Agreement and any related documents necessary to receive and administer the funds.”
ATTACHMENTS
1. Fulfillment Agreement for Unprogrammed Surface Transportation Program – Local (STP-L) Funds with the Los Angeles County Regional Park Metropolitan Transportation Authority