Bailout might keep public transit from becoming a coronavirus casualty, but more help will be needed soon
Transit agencies are likely to hemorrhage millions more over the next few months and could be in need of another substantial infusion by summer.
As airlines, hotels and big industry line up for a massive share of the $2 trillion coronavirus stimulus package approved late Wednesday by the Senate, we’re glad to see the nation’s public transit systems — a key, but oft-overlooked economic player — are in line for $25 billion in emergency funds.
Don’t pop the champagne corks just yet. At press time, the package is still awaiting approval in the House.
But even if passed into the law, the cash infusion is by no means a panacea for mass transit. Urban areas would receive only $16 billion from the package. Rural areas would get the remaining $4 billion.
“Every transit system in this country has taken a hit. But we don’t know how long the hits will keep coming.”
The country has nearly 1,000 transit systems — including the CTA, Metra and Pace suburban bus — each socked with steep COVID-19 related declines in ridership and revenue, along with increased maintenance and sanitation costs. And the agencies are likely to hemorrhage millions more over the next few months. They could be in need of another substantial cash infusion by summer if the virus lingers or ridership doesn’t bounce back soon.
“Definitely, it’s going to be helping,” said P.S. Sriraj, director of the Urban Transportation Center at the University of Illinois at Chicago. “Every transit system in this country has taken a hit. But we don’t know how long the hits will keep coming.”
For Chicago: A massive need
Mass transit is the lifeblood of big cities, moving millions of people back and forth daily. But the nation’s systems have been financially stricken for nearly a month due to the pandemic and the stay-at-home orders caused by it.
The CTA this week said it is losing more than $1 million a day as normally packed rush hour buses and trains roll around the city carrying little more than the operators behind the controls. Ridership is down 70% compared with this time last year, according to the agency.
Metra, meanwhile, is faring even worse. Ridership is down 90%, prompting the commuter rail agency to run trains on less-frequent weekend schedules seven days a week.
CTA and Metra are also subsidized by revenue from taxes on gasoline, real estate transfers and public transit set-asides. These sources are headed downward due to the pandemic. Those lost funds, in addition to heightened maintenance costs, could be staggering.
“We anticipate hundreds of millions of dollars lost over the course of this crisis,” the CTA said in a statement. “We anticipate that the financial impact on our operations will continue after the immediate containment measures have ended.”
Chicago hasn’t yet figured out how much it needs of the $25 billion federal pot, but New York, suffering an 87 percent loss in public transportation ridership, has. Big Apple transit officials are looking for a $4 billion bailout — a quarter of all funds set aside for urban areas under the package. Meanwhile, New York’s MTA has cut back subway service by 25 percent.
When the money arrives
Whenever it arrives, the $25 billion in federal funding is earmarked to cover the transit agencies’ lost revenue, personal protective equipment purchases, sanitation and reimbursement for operating costs.
The bill calls for agencies to adjust their operations to take into account that fewer people will be riding buses and trains. but it doesn’t stipulate how they should do this. Both Metra and the CTA say they don’t intend to lay off or scale back the number of transit workers.
Another transportation sector, the airline industry, is making off better in our view. Air carriers would receive $25 billion in direct financial aid under the measure. Though a larger industry than public transit agencies, privately owned airlines at least have access to credit and tremendous borrowing power.
Still, mass transit is a $76 billion concern that employs 420,000 people across the nation. Lawmakers must continue working to make sure the industry gets its fair share, particularly if future coronavirus stimulus packages are needed.
A renewed commitment to public transit?
If there is a bright note in all this, it’s that the emergency stresses the need to protect public transit in Chicago and across the country. Even before the outbreak, the nation’s financially beleaguered bus and rail systems needed $230 billion “to get up to snuff,” said Sriraj. In this region alone, about $90 billion is needed he said.
Sriraj hopes the stimulus package becomes one in series of infusions — perhaps a renewed commitment — to funding mass transit.
“It’s a step in the right direction,” he said of the package. “But it doesn’t get anywhere close to the need.”