What is the reasoning behind the law where rolling stock purchased with FTA funds is subject to reimbursement to the FTA if sold for more than $5000 but not if sold for less?
I understand that rolling stock which was purchased in whole or part with FTA funds is subject to reimbursement to the FTA. What does not make any sense is why any agency would encourage auctioning a bus for anything over $5000, since once that amount is exceeded, the agency would owe the percentage of the entire auction price back to the FTA. Please consider the example that follows: (A) Bus auctioned for $4975.00 originally 80% FTA funded – Agency owes nothing to the FTA and keeps all $4975. (B) Bus auctioned for $5500, again 80% originally funded by the FTA. The agency then owes 80% of the $5500 sale price for a total of $4400 to the FTA, and retains only $1100. It does not behoove anyone to auction a bus for more than $4999.99 because they will loose money on the deal.
