Properly classifying a community is often a necessary condition for the development of effective national public policy; when a community is correctly classified, its residents may be appropriately served. This general case holds for public transportation policy and is especially valid when considering transit service in small urban and rural communities where significant differences in total population and density may not be easily understood by policymakers more familiar with urban settings. This presentation includes a review of existing classification systems, a novel system developed to address current system shortcomings, and the application and implication of the new method on transit policy and service.