Cap and Trade Funding | Metropolitan Transportation Commission

Cap and Trade Funding | Metropolitan Transportation Commission
Cap and Trade Funding
California’s Cap and Trade program collects revenues to offset greenhouse gas emissions. MTC helps the Bay Area submit projects that will strongly compete for these dollars.
Credit
Peter Beeler
The Cap and Trade program reduces pollution by imposing limits on emissions. These limits become stricter each year.
Major emitters must buy an allowance for every ton of carbon dioxide they release into the air.
State law requires this money to be spent on projects that reduce greenhouse gas emissions.
MTC helps the Bay Area compete for these funds and works with regional partners to distribute funds that come to the region by formula.
Statewide Investment Strategy
Some of the Cap and Trade program’s ongoing revenues are dedicated to investment in sustainable communities and clean transportation. This includes:
High-Speed Rail Project
Affordable Housing and Sustainable Communities
Transit and Intercity Rail
Low-Carbon Transit Operations
The state Legislature decides each year on how to invest the remaining revenues. This money supports projects like:
Housing
Transportation
Reducing impacts of wildfire
Clean energy
Urban greening
MTC's Cap and Trade Framework
MTC’s Cap and Trade Framework helps align investments are aligned with regional goals, including:
Fleet replacement, state of good repair, core capacity improvements and key transit expansion projects for the Transit and Intercity Rail Capital Program (see below)
Fare policy programs, improvements to key transit corridors and support for small operators through the Low-Carbon Transit Operations Program (see below)
Advancing projects consistent with Plan Bay Area
How Clean is Bay Area Air?
Particulates in the air have an impact on our air quality and our health. See historical statistics at the Vital Signs website.
Get the data.
How to Apply for Funding
Cap and Trade programs are managed by various state agencies, each with their own timelines and program guidelines. See the websites below for up-to-date information.
Transit and Intercity Rail Capital Program
Low-Carbon Transit Operations Program
Affordable Housing and Sustainable Communities
Transformative Climate Communities
Urban Greening Grant Program
Related Documents
Cap-and-Trade Update – October 7, 2025
88.48 KB
pdf
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