The Metropolitan Transportation Authority is only months away from reaching “full funding grant agreements” with the federal government for the city’s East Side Access and Second Avenue subway projects, MTA and Federal Transit Administration officials said yesterday.

Combined with last November’s bond act and the funds earmarked in the city and state budgets, the funding agreements would guarantee the two projects would have sufficient money to begin the first phases of construction. The news marks a drastic change from this time last year, when the projects seemed to be slipping further into the future as the MTA pondered how to come up with enough of the billions needed to lock in federal funds.

The idea of a Second Avenue subway line has been toyed with by the MTA since 1929, but a long series of setbacks, including the Great Depression, has delayed the project for nearly three quarters of a century. The line would eventually span the length of Manhattan, from 125th Street to Hanover Square. The proposed East Side Access project would link Long Island Rail Road passengers to Grand Terminal Station with a 3.5-mile tunnel under Manhattan’s East Side.

The FTA announced that President Bush had added its funding recommendations for major transit projects across the country into his 2007 budget proposal. Mr. Bush is recommending Congress ratify $1.5 billion of funding for 28 projects, of which $300 million would go to the East Side Access project. An MTA deputy executive director, Christopher Boylan, said the amount is one of the biggest earmarks in the history of the program. When added to the federal grants in the last two years, the total amount devoted to the project by the federal government is almost $1 billion, he said.

The Second Avenue subway project is still in preliminary consideration for a funding agreement, so no amount has been set for fiscal year 2007. The project will have to vie for its share of $102 million set aside for projects still in initial discussions with the FTA. Four other major metropolitan projects in the country are also contending for the funds.

“The MTA is really in a position to break ground on these projects in the next years,” a vice president at Regional Plan Association, Jeremy Soffin, said.

The FTA and MTA are still hammering out financial arrangements, safety, security, and scheduling, among other issues, Mr. Boylan said. He said it will be a “matter of months” before an agreement is reached for East Side Access, with an agreement for the Second Avenue subway to follow soon after.

If the agreements go through, the FTA is expected to pay for about a third of the total costs of each project.

Although neither project has entered the final design phase of planning, a requirement for full funding grant agreements, MTA officials have said they want to start construction on the Second Avenue subway at the end of this year. Initial construction has already begun on East Side Access.

The Secretary of Transportation, Norman Mineta, yesterday emphasized the necessity of relieving traffic congestion across the country through mass transit initiatives, including bus rapid transit and expansion of commuter rails.

“As a nation choked with congestion, we must turn to transit as one way to make it easier and faster to get to work, relieve crowded roads, and keep our economy moving,” he said. “An investment in transit is an investment in fighting congestion.”

In his budget proposal, Mr. Bush has planned for another $303 million to go to five new projects in four states in the Southwest and Oregon, including a 21-mile extension of the Dallas Light Rail system and an eight mile extension of Portland’s “MAX” light rail line. About $572 million is proposed to continue funding 16 projects for which the FTA already has long-term agreements with.