A bill to establish a mass transportation trust fund and to amend the Urban Mass Transportation Act of 1964 in order to assure adequate local transportation service.

Sets forth Congressional findings relating to rapid urbanization. Creates in the Treasury a trust fund to be known as the Mass Transit Trust Fund to consist of such amounts as may be appropriated or credited to the trust fund. Authorizes to be transferred to the fund all amounts appropriated for purposes of grants, loans, and general administrative expenses under the Urban Mass Transportation Act of 1964 (or for liquidating obligations incurred for such purposes) and remaining unexpended on the effective date of this Act; and any amounts which may be appropriated for such purposes after the effective date of this Act.

Transfers to the trust fund from the Highway Trust Fund, for each fiscal year beginning on or after the effective date of this Act, an amount equal to 40 percent of the total amount received in the Highway Trust Fund in that year.

Authorizes to be appropriated from the general fund of the Treasury to the trust fund, for any fiscal year beginning on or after the effective date of this Act, such additional sums as may be required to make expenditures under this Act.

Gives the management of the fund to the Secretary of the Treasury. Provides that the amounts in the trust fund shall be available as provided by appropriation acts for making grants and expenditures to meet obligations of the United States under the Urban Mass Transportation Act.

Provides for repayment of advances with interest.

Enables the Secretary to make grants or loans to any State or local public body to enable it to assist any mass transportation system which maintains mass transportation service in an urban area to pay operating expenses incurred as a result of providing such service.

States that no financial assistance shall be provided under the Act unless: (1) the Secretary determines that the mass transportation services provided by the system involved are needed to carry out a program under the Act; (2) the applicant State or public body has submitted to the Secretary a comprehensive mass transportation service improvement plan which is approved by him and which sets forth a program, meeting criteria established by the Secretary, for capital or service improvements to be undertaken for the purpose of providing more efficient, economical, and convenient mass transportation service in an urban area, and for placing the mass transportation operations of such system on a sound financial basis (including a reasonable fare structure), and (3) the Secretary determines that the mass transportation services provided by each system involved are being provided by an efficient operation of such system in accordance with regulations promulgated by the Secretary.

Provides that the amount of any grant under this Act to a State or local public body to enable it to assist any mass transportation system to pay operating expenses shall be four times the amount of financial assistance provided from State or local sources for that purpose.