Coronavirus

Public Transit Advocates Ask for $12.8 Billion Bailout To Cope With 75 Percent Revenue Drop Related to Coronavirus

Public transit was already in decline before the COVID-19 outbreak. Now transit agencies are teetering on the brink of collapse.

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Industry after industry is staring into the abyss due to coronavirus-induced shutdowns. That's particularly true of the public transportation sector, which is asking the federal government for a multi-billion dollar bailout in the face of cratering ridership.

On Tuesday, the American Public Transportation Association (APTA)—which represents the nation's transit agencies—asked Congress for $12.8 billion in emergency funding for this fiscal year to deal with the added costs of COVID-19.

"These funds are necessary to maintain essential services, including providing public transportation to health care workers, Medicaid recipients who receive non-emergency medical transportation, and law enforcement personnel," APTA wrote in a press release. "Without these emergency funds, public transit agencies may be required to suspend services."

The entire Federal Transit Administration's budget was $13.4 billion in Fiscal Year 2019.

The group estimates that 98 percent of transit agencies have seen their operating costs increase thanks to the necessary cleanings of vehicles and facilities to prevent the spread of COVID-19. The costs of these cleanups are estimated to be $1.75 billion.

In addition, APTA estimates agencies are experiencing another $6 billion loss due to a 75 percent decline in farebox revenue. That's in addition to $4.8 billion in lost dedicated sales tax revenues.

Randal O'Toole, a transportation expert at the Cato Institute, has said that a mix of pension obligations, rideshare services, low oil prices, and growing maintenance costs would serve as the "four horsemen of the transit apocalypse." He can now add pestilence to the list.

The story APTA reports at the national level is mirrored at the regional and state level.

New York's Metropolitan Transportation Authority (MTA), which runs rail and bus service in the New York City metro area, has experienced a 60 percent decline in subway ridership and a 49 percent decline in bus ridership, according to a letter from MTA CEO Patrick Foye to New York's congressional delegation asking for $4 billion in federal aid.

"The stark reality is that as more people stay home following the advice of medical experts, the MTA is now facing financial calamity," Foye wrote. "We are asking Congress to step up again and deliver for the system that is the lifeblood of New York City and the engine of the region's economic future."

The Washington Metropolitan Area Transportation Authority (WMATA), which runs buses and trains the D.C. area, is in no better shape. The agency is reporting a staggering 85 percent decline in ridership, resulting in $52 million in lost monthly revenue.

WMATA has cut back on service in response, but that has done little to reduce its operating costs, wrote CEO Paul Wiedefeld in a letter to Virginia Gov. Ralph Northam, Maryland Gov. Larry Hogan, and D.C. Mayor Muriel Bowser. He is also asking for emergency funding to plug the agency's $52 million monthly deficit.

The Bay Area Transportation Authority (BART) in the San Francisco area is reporting $37 million in new losses thanks to an 85 percent drop in ridership, reports Fox News.

Few transit agencies were in good financial shape prior to the COVID-19 outbreak. They were already losing riders and revenue to rideshare services and private auto travel. But the current pandemic has these systems teetering on the brink.

The question remains whether taxpayers should be required to bail out these agencies, particularly when there are so many other people and institutions demanding relief right now.

Baruch Feigenbaum, a transportation expert at the Reason Foundation (which publishes Reason), says that while he's a skeptic of bailouts and a lot of federal transit funding, aid to transit agencies is probably warranted right now.

"Ridership is clearly down and it's circumstances they can't control. We don't like big bailouts, but we could make an exception here," he says.

While the massive ridership plummet is not something anyone could have predicted, Feigenbaum says that transit agencies have made things worse by chasing "choice riders"—those who have the option of riding or driving—with expensive new capital projects like new suburban rail lines.

Even during good times, these projects were ill-advised, says Feigenbaum, and often came at the expense of bus service for people who are truly transit-dependent. With so many "choice riders" working from home and avoiding optional transit trips, transit agencies are left with only a rump of core riders still paying fares.

So far, the U.S. Department of Transportation has said they will give localities more flexibility to use existing federal transit funding to respond to COVID-19, and that agencies could ask to have specific federal regulations waived.

Congress is currently debating a third aid package, and there's a possibility that additional funds for transit will be included in whatever they settle on.

Feigenbaum recommends that any aid should be given in the form of low-interest loans to transit agencies and that this be strictly limited to paying for issues caused by the current pandemic.

"It's an unprecedented challenge," he says. "Any bailouts or funding needs to focus as narrowly as possible on the problems created by COVID-19 and not used to fund other things that transit agencies should have been doing all along."

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  1. Industry after industry is staring into the abyss due to coronavirusgovernment-induced shutdowns.

    Fixed?

    1. Yes. But they will never admit it.

      1. Right but you told us you want to eat shit and murder babies

    2. That was the first thing that jumped off the page for me. Thanks for saving me from having to look up how to do strikethrough text.

        1. I dont know why this posted here. I miss reasons old site, i might repost the same thing three times but it was still better than this shit.

        2. Last I checked, you can defer student loan payments for a few reasons including inability to pay due to, say, unemployment.

          I wonder if Democrats are in favor of giving me cash for the loan payments I’ve been making. I mean, after all if they’re going to reward shitty behavior why not reward responsible behavior right along with it?

          Ultimately I suspect I’m going to regret paying off my student loans instead of just investing that money instead.

          1. Ya but temporary hardship doesnt mean that 10000 dollars is just written off. Its simply a delay till your in a better position to pay. Theyre just using this as a oppurtunity to go for full student debt forgiveness. Buying votes.

            1. Absolutely, which was essentially my point. If your payments are having problems because of a temporary outbreak, you already have recourse. Not paying, as far as I know, is also a recourse. Over the course of, say, 20 years this will be a blip at most.

              1. I see this as a desperate act by the left. Theyre not letting a tragedy go to waste but i believe theyre truly scared of what 2020 holds for the left. Fractured party, failed impeachment, Trumps administration is doing about as good as can be expected with corona. I smell blood.

                1. It’s just business as usual, and I’ve suspected for some time now that Democrats never really wanted to win the Presidency this time around. Trump, like Obama before him, is great to run against as long as you make sure you don’t win.

  2. My heart bleeds. No really, but actually no, not my heart — my wallet.

    1. Right but you told us you want to eat shit and murder babies

      1. Is this what you do on your fortnightly conjugal visits? Or weekend releases? The sporadicity is alarming.

  3. They should just lay off their employees like the restaurants. Oh, wait…

    1. Of course, the baseline requirement for a restaurant employee is breathing which does appear to be similar to the baseline requirement of being a transit employee.

      At least if you’re a server, you can always work at another restaurant somewhere else. If you’re a transit employee, you work for a local monopoly. Good luck!

  4. IF IT SAVES JUST ONE LIFE

    1. “Now we’re merely haggling over the price.”

  5. “We are asking Congress to step up again and deliver for the system that is the lifeblood of New York City and the engine of the region’s economic future.”

    Starbucks?

    1. Wall Street?

    2. Cocaine?

  6. ” . . . and law enforcement personnel . . ”

    Say what?

  7. okay but like eleven million of it goes straight to cleaning the cars.

  8. How about we just call it quits for government transportation systems?

    If it is worth doing, let private enterprise do it. Maybe by some kind of system where you can call up a vehicle to take from where you actually are to exactly where you want to go?

    1. Man, what great idea for an app!

  9. In the near post-corona future mass transit is dead anyway. The sheeple will apply their six month memory and demand sealed, personal compartments.

    Meanwhile, maybe somebody should run the numbers on how to transport those important, critical people who are allowed to travel. I bet Uber or even a town-car service could do it cheaper and faster.

  10. They should have saved up for a rainy day. Not our fault they didn’t have a plan.

  11. I am making a good salary from home $1200-$2500/week , which is amazing, under a year back I was jobless in a horrible economy. I thank God every day I was blessed with these instructions and now it’s my duty to pay it forward and share it with Everyone, Here is what I do. Follow details on this web page……. Read more

  12. They should have saved up for a rainy day. Not our fault they didn’t have a plan.

    ipl 2020 new schedule

  13. Wouldn’t their pleas for new pork have been more credible if the CEOs, management staff and union “workers” had offered to take voluntary pay cuts for the duration of the new pork?!

    These guys have nothing to lose. For them, unlike private sector workers, there’s a guaranteed flow of paychecks, whether they produce anything useful or not.

    Patrick Foye, above, makes $290 k/year. Paul Wiedefeld Makes almost $499k. Could they survive at half pay for a few months?

    I say, let them twist in the wind, like the rest of us.

    1. Wiedefeld makes almost $400k, not $499k. Typo…sorry.

      1. Typo, or prediction?

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