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October 21, 2024
KEY TAKEAWAYS
Described by the Federal Transit Administration (FTA) as “historic investment” in public transit, the 2021 Infrastructure Investment and Jobs Act (IIJA) (P.L. 117-58) aims to support transportation emission reductions and modernize transit systems across the United States. The law provides $590 billion in transportation funding, $91.9 billion of which has been dedicated to public transit. Meanwhile, the Inflation Reduction Act (IRA) (P.L. 117-169), enacted in August 2022, invests $369 billion in the “most significant action Congress has taken on clean energy and climate change.” Of the $12.3 billion the IRA dedicates to transportation, $5.21 billion funds transportation pilot programs with an emphasis on emission reductions and transportation equity, as part of the Biden-Harris Administration’s Justice40 initiative.
Revitalizing public transportation, particularly following COVID-19 related ridership declines, is a key component of achieving a 50% reduction in greenhouse gas emissions by 2030. Although transitioning from gasoline-powered vehicles to electric vehicles (EVs) is important for achieving climate goals, mass EV adoption would still be insufficient to meet net-zero emission targets by 2050. Alongside beneficial electrification, public transit will need to be supported and scaled up in order to meet climate goals and stave off future warming. Estimates suggest that global transit usage must double by 2030 to meet the critical climate goal of limiting warming to 1.5 degrees Celsius.
While taking public transit offers clear climate benefits, it also provides key advantages to city planning, public health and safety, and people’s wallets. The National Association of City Transportation Officials considers public transit “the most spatially efficient mode,” as it reduces the need for parking lots and alleviates street congestion. Designing cities around public transit also promotes walkability, which contributes to better public health outcomes. In addition, public transit helps reduce air pollution from personal vehicles, which has been linked to four million new asthma cases each year. Transit is also significantly safer—passenger vehicle fatalities occur at rates 17 times higher than transportation involving trains and 50 times higher than transportation involving buses. Furthermore, the American Public Transportation Association estimates that individuals can save over $13,000 annually by switching from personal vehicles to public transit.
Public transit agencies across the United States face significant financial challenges. All public transit systems in the United States rely on a mix of local, state, and federal subsidies to stay in operation, with 76% of subsidies coming from local and state governments. For example, in 2019 the Washington Metropolitan Area Transit Authority (WMATA) in D.C. sourced 58% of its operating revenue from federal and jurisdictional subsidies. While national transit ridership is continuing to bounce back from early pandemic levels, public transit agencies across the country still face lower ridership and a potential “death spiral” as historic transportation patterns shift with the rise of remote work.
To address this rising concern, the IIJA allocated $33.5 billion to the Urbanized Area Formula Grants Program. These funds are available for the planning and engineering of transit systems and for capital projects such as investments in trains, rail systems, streetcars, buses, passenger facilities, security equipment, and the overhaul of existing infrastructure. This funding is helping modernize transit infrastructure and expand accessibility of transit in so-called transit deserts. In fiscal year (FY) 2023, $7.06 billion was distributed through the Urbanized Area Formula Grants Program, up from $6.92 billion in FY 2022 and $5.37 billion in FY 2021. The program provides funding based on a formula that accounts for factors such as population, income, density, and transit utilization. Funds are available for an additional five years from the date of appropriation, providing transit agencies with flexibility in spending.
The United States’ aging infrastructure—aging public transit, in particular—has received increased attention on Capitol Hill. Transit services face declining performance, increased maintenance costs, and growing safety concerns stemming from routine underinvestment. The IIJA addresses these concerns by providing $23.1 billion to the State of Good Repair Formula Grants Program. This funding is focused on improving public transit infrastructure that is at least seven years old, and addresses the “multibillion-dollar repair backlog” of U.S. transit infrastructure needing repair or replacement. In FY 2023, $4.18 billion was apportioned to 87 urbanized areas—up from $4.11 billion in FY 2022 and $2.71 billion in FY 2021. Additionally, the $10.75 billion Buses and Bus Facilities Grant Program and $8 billion Fixed Guideway Capital Investment Grant Program improve bus and rail services by providing capital for new vehicles. So far, these programs will lead to the domestic production of over 4,600 new buses for transit operations, with 80% being zero or low emission.
Public transit is most effective when various transportation options, such as walking, biking, buses, and trains, are interconnected: a concept known as multimodality. Funding for multimodal transit networks has historically been low. However, the $7.5 billion Rebuilding American Infrastructure with Sustainability and Equity (RAISE) discretionary grant program provides competitive grants to “pursue multi-modal and multi-jurisdictional projects” that support transportation projects not covered by traditional funding streams.
Notable projects funded by the RAISE program include an urban greenway in Detroit, Michigan, that will connect 23 Detroit communities and an accessibility overhaul of the busiest transit corridor in Durham, North Carolina. Initiatives like the RAISE grant program are essential for improving transit accessibility and advancing the development of “complete streets” that accommodate pedestrians, bikers, transit riders, and drivers while reducing emissions generated by personal vehicles.
Although highways and freeways are common arteries for urban transportation, their associated environmental impacts are immense. In 2022, passenger cars and light trucks were responsible for 57% of transportation emissions, enabled by the more than 164,000 miles of highways in the United States. Additionally, research shows that adding a single new lane to a highway can increase carbon emissions by more than 100,000 tons over a 50-year period. The damage caused by highways extends beyond the environment: the construction of the Interstate Highway System (IHS) in the last century divided and displaced an estimated 475,000 households, with marginalized communities disproportionately targeted for demolition.
To begin to address these historical inequities, the IRA includes $3.2 billion for the Neighborhood Access and Equity (NAE) grant program. The NAE program provides competitive funding to connect communities divided by highway and freeway infrastructure with the aim of improving walkability, safety, and social cohesion. The program application window closed on March 13, 2024, with 131 projects receiving federal funding. However, demand for the program was significantly higher: in total, 682 applicants requested over $11.6 billion from the NAE program.
One NAE grant recipient is the City of Atlanta, Georgia, which plans to construct a freeway lid over the interstate running through the heart of the city. Referred to as “The Stitch,” this project will create a 14-acre green space over the I-75/85 Connector, bridging the 62-year division between midtown and downtown Atlanta and fostering pedestrian-friendly green spaces. The Stitch not only reconnects divided neighborhoods but also aims to create new housing and street-level retail. This form of walkable development can reduce personal vehicle dependency and transportation emissions.
While the IRA and IIJA continue to make substantial contributions to public transit, their investments compete directly with policies supporting personal vehicle use. Both pieces of legislation allocate substantial funding for the expansion of electric vehicle infrastructure, including establishing a nationwide charging network and providing EV tax incentives. While transitioning to EVs is a crucial step towards reducing national emissions, prioritizing personal vehicle use can encourage car-centric urban planning. Alternatively, the electrification of public transit may combine the emission reduction benefits of EVs with the efficiency of mass transit systems.
Analysis of IRA and IIJA transportation funding suggests that the laws may serve to reinforce prevailing car-centric design decisions in the United States, with 44%, or $307 billion, of their combined transportation funding going to roadway planning and development. In conjunction with a $119 billion investment in EVs, the laws demonstrate a continued reliance on personal vehicle infrastructure and are “subsidizing car ownership more than any other mode of transportation by far,” according to Yonah Freemark, a researcher at The Urban Institute.
Additionally, the Georgetown Climate Center found that transportation funding in the IIJA has the potential to increase emissions if discretionary funding is used to expand lanes and roadways, as opposed to repairing existing infrastructure. This phenomenon, known as induced demand, occurs when increasing roadway capacity encourages more driving, ultimately leading to higher traffic volume and emissions. The transition to EVs alone is likely insufficient to reduce U.S. emissions fast enough to meet international emission targets set by the Paris Climate Agreement, and electric vehicles still pose many of the same safety, cost, and accessibility challenges as internal combustion engine vehicles.
The IRA and IIJA have made significant strides in promoting public transit across the United States, representing the first steps towards reducing transportation-related emissions and improving transit accessibility. However, the prioritization of EVs and personal vehicle infrastructure often conflicts with stated goals of improved access and equity in mobility. Shifting funding priorities from enhancing personal vehicle access to investing in accessible public transit can help build on IRA and IIJA investments and support the transition of U.S. transportation to a sustainable, equitable future.
Author: Joshua Cohen
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