Federal funding assistance to public transportation agencies is provided primarily through the public transportation program administered by the Department of Transportation’s Federal Transit Administration (FTA). The federal public transportation program was most recently authorized from FY2022 through FY2026 as part of the Infrastructure Investment and Jobs Act (IIJA; P.L. 117-58). Congress has extended the IIJA authorizations through December 11, 2026 (H.R. 6500). Congress may consider a number of issues and policy options related to possible reauthorization of public transportation funding. Some of these issues would be addressed by provisions of H.R. 8870, a surface transportation reauthorization bill ordered to be reported by the House Committee on Transportation and Infrastructure in May 2026. The overall level of funding for the public transportation program is typically a major topic in surface transportation reauthorization. The IIJA provided about a 67% increase (in nominal dollars) in annual funding for public transportation compared with the prior authorization, the Fixing America’s Surface Transportation Act (FAST Act; P.L. 114-94), as extended. Public transportation program funding authorized and appropriated under IIJA averaged $21.4 billion annually in FY2022-FY2026. Inflation, particularly in 2021-2023, has eroded some of the purchasing power of this funding. The source of funds for the public transportation program, along with the solvency of the Highway Trust Fund (HTF) and its two accounts—the highway account and the mass transit account—may be another issue in the reauthorization debate. Traditionally, 80% of program funding has come from the mass transit account of the HTF. Outlays from the account have outpaced receipts, excluding U.S. Treasury General Fund (general fund) transfers, for over two decades, an imbalance the Congressional Budget Office (CBO) projects will continue in the future under current law. Balancing the receipts and outlays of the mass transit account would involve a cut in program spending, an increase in revenues paid into the account, or a combination of the two. An increase in revenues could involve a commitment to regular transfers from the general fund. In addition to the funding from the HTF, the IIJA provided multiyear advance appropriations from the general fund for several public transportation programs. Given the problems with the HTF, Congress could rely more on appropriated budget authority, such as with a greater share of funding in annual appropriations. An objection to using general fund instead of HTF money is that it provides less certainty to transit agencies that have to plan operations and capital purchases over several years. Multiyear advance appropriations would blunt this objection by providing greater certainty from year to year. Historically, the federal public transportation program has prioritized capital expenditures, with support for operating expenses in some circumstances. Greater federal support for transit operations could be a reauthorization issue, especially as transit agencies struggle with lower ridership and fare revenue largely due to the disruptions of the COVID-19 pandemic. The Capital Investment Grants Program (CIG), a major discretionary capital program, may be a topic in the surface transportation reauthorization debate. CIG provides funding to support the construction of new fixed-guideway transit systems (such as transit rail, bus rapid transit, and ferry systems) and to add to existing systems. The IIJA appropriated $1.6 billion per year from the general fund for CIG and authorized another $3.0 billion per year from the general fund, subject to appropriation (in nominal dollars). Supporters of CIG have sought more funding and greater certainty from year to year. Critics contend that CIG funding encourages communities to build expensive fixed-guideway infrastructure rather than invest lesser sums in improving bus service. Although alternatively fueled public transportation buses are generally eligible for federal transit funding, Congress has also dedicated funding to such buses through the competitive Low and No Emission Vehicle (Low-No) Program. Funding for the Low-No Program increased from an annual $55 million in the FAST Act to an annual $1.1 billion in the IIJA. Options for Congress include reauthorizing the Low-No Program at a similar or higher funding level as enacted in the IIJA; reducing funding to a much lower level to encourage experimentation rather than deployment as was enacted in the FAST Act; or abolishing the program, effectively returning decisions about vehicle technology to funding recipients. Other issues that Congress may consider include public transportation safety and security, emergency relief funding and infrastructure resilience, the rural and tribal transit programs, options for transit-oriented development, priority criteria for competitive grant awards, funding for ferries, and project delivery.
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