The below is a summary of part 2 of a 3-part series on the expiration of the Infrastructure Investment and Jobs Act published by Pew Charitable Trusts.
Thanks to the 2021 Infrastructure Investment and Jobs Act (IIJA), transit providers across the U.S. have benefitted from an annual increase in federal transit formula funding and some discretionary grant funding amounting to a 2/3 increase or an increase of $8.6 billion overall. Those funds have been used for a variety of improvements, including addressing repair backlogs, modernizing bus and rail fleets, and making transit stations more accessible. With IIJA now reaching its expiration, transit providers and states have been left questioning whether Congress will continue prioritizing transit funding.
One proposal currently under consideration in the U.S. House of Representatives, the BUILD America 250 Act, could reduce public transit funding by 14% over five years when compared to the IIJA. The proposal would also eliminate or significantly reduce several competitive grant programs that have helped agencies fund projects involving bus electrification, accessibility, and system modernization. Additionally, shifting federal funding away from guaranteed advance appropriations and toward annual appropriations could make it more difficult for states and transit agencies to plan and finance long-term infrastructure projects. These potential changes would have varying impacts across the country, with rural transit providers particularly vulnerable because of their limited opportunities to generate additional funding.
“Federal funding is critical to Missouri transit providers. Currently, Missouri ranks near the very bottom nationally when it comes to state support of transit operations and capital. Missouri providers will be in a dire situation if federal funding support decreases. It is imperative that riders and stakeholders not only tell their stories to state legislators but Missouri’s congressional delegation as well,” said Kimberly Cella, MPTA Executive Director. “Transit investment matters from the economic impact at the state level down to each individual rider.”
The expiration of the IIJA also highlights the growing responsibility of state and local governments in supporting public transportation. Their contributions to transit funding have more than doubled since 1956, and they may face additional financial pressure if federal investments decline. While the IIJA provided substantial support for capital improvements, federal funding has historically covered a much smaller share of day-to-day operating expenses, leaving agencies with ongoing financial challenges. In 2019, for instance, federal funds were used for 7.9% of operating costs but 32.3% of capital spending.
As Congress considers the next federal transportation funding package, policymakers at every level of government will need to identify sustainable funding strategies to support transit system repairs, maintenance, and future investments. The decisions made in the coming months will play an important role in determining the future of public transportation nationwide.
View Pew Charitable Trusts article here.