Transit Agencies Will Face Challenges in Getting Federal Dollars

While recent federal legislation allocates billions to transit projects, local leaders face difficult choices as they struggle to match federal funds while ridership remains below pre-pandemic numbers.

May 13, 2022, 7:00 AM PDT

By Diana Ionescu @aworkoffiction

New York Public Transit

Roman Tiraspolsky / Shutterstock

The federal Infrastructure Investment and Jobs Act (IIJA) will pump billions of dollars into transit projects across the nation, writes Thomas Day in Governing, but local governments will have to develop strategies to meet federal requirements as they reshape their systems around post-pandemic travel patterns. 

“Difficult choices will need to be made now — think new tax increment financing districts, congestion pricing or repurposing of existing public funds — or IIJA grant dollars will be left on the table,” Day says. “Unlike the COVID-19 relief bills, which included funding to support operational expenses, much of the IIJA’s public transit funds must be spent on capital projects.” Accordingly, “For IIJA to revive and sustain public transit, local governments and transit agencies need to make an effective push to recover lost revenue, then act on a bold vision of post-COVID-19 cities.”

“Transit-oriented development, long a fascination among urban planners, may now provide a solution for mayors who have seen the lifeblood sucked out of downtowns as professional service workers continue to work from home,” posits Day. “By building housing closer to transit, protecting low-income residents and public housing, increasing urban density and providing easier access to downtown civic amenities, cities could strengthen the magnetic pull of urban centers even if work-from-home trends continue.” This could help draw riders back to public transit and counter the hollowing out of downtowns by introducing a wider variety of uses in downtown cores, as well as more convenient ways to access them.

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