(a) Revenue from a surcharge must be used for costs associated with the planning, engineering, development, construction, implementation, administration, management, operation, and maintenance of public transit system projects that are part of a transit improvement program.

(b) Revenue from the surcharge may be:

(1) Combined with other funding generated by local, state, or federal governments from taxes, fees, or fares, and may be used to match state aid funds and federal grants;

(2) Combined with private moneys where allowed by law and used as a public entity's share of costs associated with a public-private initiative entered into pursuant to Chapter 975 of the Public Acts of 2016;

(3) Pledged to the payment of bonds issued for the purposes of financing a transit improvement program in accordance with this part; and

(4) Directed or transferred to implementing agencies to carry out a transit improvement program.

(c) If either a transit improvement program or a public transit system project that is part of a transit improvement program becomes unfeasible, impossible, or not financially viable, the revenue from the surcharge for the transit improvement program may be directed to and utilized for a separate transit improvement program or public transit system project that:

(1) Has been approved by:

(A) The local government's legislative body, as required in § 67-4-3206(e)(1); and

(B) A majority of the number of registered voters of the local government voting in an election pursuant to the procedures in § 67-4-3202; and

(2) Otherwise meets the requirements of this part.

(d) The proceeds of any bonds issued for the purposes of financing a transit improvement program shall not be used for operations of any public transit system projects or services that are part of the program, and in no event, shall the credit of any local government be given or loaned to or in aid of any person, company, association, or corporation, within the meaning of the Constitution of Tennessee, article II, § 29.