U.S. officials fear virus could collapse public transit
Agencies across country are projected to rack up $40B in budget shortfalls
WASHINGTON— Jeffrey Tumlin, who leads San Francisco’s $1.3billion (U.S.) transit system, is in a hard spot.
Ridership on his transit system is down 70 per cent citywide, reeling from the effects of apandemic that has killed more than 138,000 in the United States alone and smothered the national economy.
His agency predicts $568 million in revenue losses over the next four years, and in an effort to stay afloat, he has had to eliminate half his city bus lines, unsure if they will ever come back.
In March, his department received $373 million from Congress as part of a $25-billion package to help public transit agencies across the country.
It was a one-time infusion of funds that staved off the worst — a potential deficit of $410 million by the year’s end that could have forced 1,400 transit workers to lose their jobs and deplete the agency’s rainy-day fund in three months.
But coronavirus cases are rising in more than three dozen states, and the first round of congressional aid is quickly drying up. Transit leaders in cities including Seattle, Los Angeles and Miami warn they need billions of dollars more in aid; otherwise, their systems could collapse.
“Unless the economy comes ripping right back, and there’s a vaccine and social distancing is eliminated, we fall off the financial cliff in 2023,” Tumlin said. “That would result in such severe service cuts that it puts us on what is called the transit death spiral.”
As transit use plunged across the country because of the pandemic, the economy cratered into a recession, putting nearly 11 per cent of Americans on the unemployment rolls and closing about 66,000 small businesses, dealing a blow to the sales and income tax revenues that many cities and states use to fund transit agencies.
The mix of forces has been brutal: Ridership has plummeted 90 per cent on some of the nation’s biggest systems, including in New York and the San Francisco Bay Area. Reduced tax revenues are forcing state and local leaders to trim their transit subsidies. Transit agencies across the country are projected to rack up close to $40 billion in budget shortfalls, dwarfing the $2-billion loss inflicted by the 2008 financial crisis.
This could affect the industry forever, transit experts said, causing leaders to substantially cut service to match catastrophic drops in revenue. Capital projects meant to upgrade transit systems and reduce the risk of accidents would have to be delayed. Wait times could become so long that using public transit to commute may become unrealistic.
“For city economies as a whole, this is a threat to their viability,” said Ben Fried, a spokesperson for the TransitCenter, a philanthropic foundation that supports nationwide transit overhaul. “For some people, it’s going to put their job out of reach. If employers can’t count on workers having access to jobs, firms are going to choose to locate elsewhere.”
Transit leaders across the country are imploring congressional leaders to provide up to $36 billion in additional assistance.
They want to ensure subways, buses and rail systems across the country can weather a sustained decline in revenue and be ready as the economy and school system reopen.
“Our transit systems collectively move millions of students throughout the school year and are responsible for getting millions more people to work every day,” a coalition of 26 transit leaders wrote to Senate leaders Tuesday. “Without additional federal assistance, many of our agencies will be forced to make difficult decisions that will negatively impact the lives of essential workers and the returning workforce.”
Experts said big city transit systems are likely to be hit the hardest and quickest. Their operating budgets tend to depend heavily on rider fares and sales tax.
But small and mid-size agencies, which tend to rely more on direct support from state and local governments or revenue sources like property taxes, will not be spared. They are most likely to see their worst budget woes creep up early next year.
And while the emergency federal funding has stopped transit systems from facing immediate doom, aid is predicted to dry up in five to eight months for big city networks, compared with 12 to 20 months for smaller systems, according to expert analysis.
This could plunge systems into a “transit death spiral,” where cuts to service and delayed upgrades make public transit a less convenient option for the public, which prompts further drops in ridership, causing spiralling revenue loss and service cuts until a network eventually collapses.
And for many transit agencies, the pandemic came right as their systems were finally recovering from the 2008 recession. “We all thought that was one of the worst things we’d see in our lifetime,” Beth Osborne, director of Transportation for America, a transit advocacy group, said of the financial crisis’s effect on public transit. “The pandemic is a much more profound, much more immediate impact.”
But the industry’s plight has not been forgotten by those on Capitol Hill.
In May, the House passed a coronavirus aid package that would dedicate an additional $15 billion in funding to transportation agencies. The package has stalled in the Republican-led Senate.
Transit leaders across the country warn that the longer Congress waits to act, the deeper the effects will be to their city’s bus, rail and subway systems. “When they get around to it, they no longer are doing damage prevention,” said Karl Gnadt, managing director of the Champaign-Urbana Mass Transit District in Illinois. “The damage is already occurring.”