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Public Transit Gets Fiscal Shot from the American Rescue Plan

Even with $30.5 billion to help it dig out of a huge financial hole, public transit's future remains unsettled as commuters and workers change their work patterns. Will ridership return to normal?

City bus on street in San Francisco.
A public transit bus in downtown San Francisco. (David Kidd/Governing)
It’s been a difficult year for the nation’s public transit systems and the people who depend on them. Things were even worse for those with jobs that couldn’t be performed at home on a computer. When white-collar workers abandoned their offices, downtowns quickly turned into ghost towns. And when customers disappeared, so too did the service jobs that cater to them. 

With significant numbers of people with nowhere to go, ridership and revenue plummeted, forcing transit agencies across the country to cut payroll and slash services to make ends meet. At the same time, millions of essential workers had to get where they were needed. Last year, two stimulus packages totaling $39 billion helped keep the trains and buses running, at least for the time being. 

But transit agencies may need to rethink their plans for the future and how they spend their share of the $30.5 billion available from the just-passed American Rescue Plan. In the rush to pass the first pandemic relief bill last spring, stimulus money was apportioned in a way that favored smaller transit agencies. The latest round of funding uses a formula that distributes more money to the larger cities and systems that have borne a greater COVID-related burden.  

With the infusion of federal funds, some of the draconian measures being contemplated by transit agencies have been reversed or shelved, and several cities across the country are already moving to reinstate service closer to pre-pandemic levels. A proposed 40 percent reduction in subway service was recently canceled by the New York City Transit Authority, and existing plans to modernize the country’s largest transportation network were at least partially revived.

Transit officials in Washington are scrapping plans to close nearly a quarter of the system’s subway stations while cutting the number of bus lines in half. Los Angeles has canceled a 20 percent cut in rail and bus service. But stimulus money will not solve all of the nation’s public transportation problems. New York, as the biggest example, will still be facing an $8 billion deficit in the years ahead. 

Metropolitan transit systems aren’t the only entities that stand to benefit from the latest stimulus package. Money has also been allocated for passenger trains and airlines. Amtrak will receive $1.7 billion to restore long distance routes and modernize its infrastructure. The legislation also includes $8 billion for airports and $15 billion for airline payroll support, keeping pilots, mechanics and flight attendants on the job through September. 

American Rescue Plan money must be allocated by September 2024 and spent within five years after that. Planners and policymakers will be tasked with not just rebuilding their systems, but in many cases, reimagining them as well. The post-COVID commuter culture could look much different than it did two years ago. The pandemic has disrupted the way many Americans earn a living, accelerating a trend toward remote work that has been percolating for some time. A recent survey by the Partnership for New York City, a nonprofit organization of business leaders, finds that less than half of Manhattan’s one million office workers are expected to return by September. Most will continue to work remotely, at least part time. 

According to the survey, eight of 10 returning employees will rely on public transit to get to work. Whether they come back or not, the traditional 9-5 commuting model may be a thing of the past. Some schedules have already been adjusted to better accommodate the earlier commuting times of the essential workers who never stopped riding. But it isn’t just when the service is available that can make a difference. How resources are used can be just as important. 

Overall, demand for service in San Francisco was down as much as 80 percent over the summer. But bus lines that bring essential workers to commercial districts and hospitals saw only a 30 percent drop. Several times in the past year, the transit authority has rebalanced the system, using the flexibility of bus routes to meet demand where it is needed. Similarly, the Long Island Rail Road, traditionally a commuter service catering to white-collar office workers, has cut express trains in favor of local trains that serve people near the stations that used to be bypassed. A whole new group of riders can now take advantage of a service that before, literally passed them by. 

After the last federal stimulus dollar is spent, state and local governments may find it difficult to subsidize transit at previous levels. Also, revenue from fares is unlikely to rebound anytime soon, leaving transit agencies to find new ways to fill budget gaps and lure new and returning customers, all while rebuilding and maintaining their infrastructure. The pandemic will eventually fade, but the disruptions it inflicted on public transportation will still be felt for years to come as planners balance budgets with the need for service that accommodates everyone.

David Kidd is a photojournalist and storyteller for Governing. He can be reached at
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