(a) Notwithstanding subdivision (a) of Section 99247, all of the following costs shall be excluded from the definition of “operating cost” for the purposes of calculating any required ratios of fare revenues to operating cost specified in this article:

(1) The operating costs required to provide comparable complementary paratransit service as required by Section 37.121 of Title 49 of the Code of Federal Regulations, pursuant to the federal Americans with Disabilities Act of 1990 (42 U.S.C. § 12101 et seq.), as identified in the operator’s paratransit plan pursuant to Section 37.139 of Title 49 of the Code of Federal Regulations.

(2) Cost increases beyond the change in the Consumer Price Index for all of the following:

(A) Fuel.

(B) Alternative fuel programs.

(C) Power, including electricity.

(D) Insurance premiums and payments in settlement of claims arising out of the operator’s liability.

(E) State and federal mandates.

(3) Startup costs for new services for a period of not more than two years.

(4) Costs required to operate demand-response and microtransit services that expand access to transit service beyond fixed route corridors. For purposes of this paragraph, “microtransit” has the same meaning as in Section 99314.6.

(5) Costs of funding or improving payment and ticketing systems and services.

(6) Costs of security services and public safety contracts.

(7) Any expense greater than the actuarially determined contribution associated with pensions and other post-employment benefits as required by Governmental Accounting Board Statement Numbers 68 and 75.

(8) Costs of planning for improvements in transit operations, integration with other operators and agencies, transitioning to zero-emission operations, and for compliance with state and federal mandates.

(b) The exclusion of costs from the definition of operating costs in subdivision (a) applies solely for the purpose of this article and does not authorize an operator to report an operating cost other than as defined in subdivision (a) of Section 99247 or a ratio of fare revenue to operating cost other than as that ratio is described elsewhere in this article, to any of the following entities:

(1) The Controller pursuant to Section 99243.

(2) The entity conducting the fiscal audit pursuant to Section 99245.

(3) The entity conducting the performance audit pursuant to Section 99246.

(Amended by Stats. 2021, Ch. 81, Sec. 7. (AB 149) Effective July 16, 2021.)