CARES Act signed into law; transit agencies to receive federal funds within seven days

The Coronavirus Aid, Relief and Economic Security (CARES) Act was signed into law March 27 at an Oval Office ceremony, marking the final step needed before financial relief can be provided to transit agencies as they work to keep their systems clean and operational during the novel coronavirus pandemic. 

The bill is the largest piece of legislation ever signed into law and contains $25 billion for transit agencies and more than $1 billion for Amtrak to support efforts taken to combat the spread of the pandemic. The American Public Transportation Association (APTA) explains that the $25 billion to agencies is nearly three times the amount the same agencies received in Fiscal Year 2020 appropriations.  

The $25 billion will be apportioned based on FY20 funding formulas through the Federal Transit Administration and language in the CARES Act dictates that these funds will be distributed within seven days of the bill’s enactment. For more on the how the funds will be divided please see APTA’s breakdown of the funds.

“Public transit is a critical lifeline for millions of Americans, and this legislation will provide much needed support to the transit systems working tirelessly to provide essential public transit services for health care workers, first responders, and grocery and pharmacy workers, as well as medical transportation for kidney dialysis, cancer treatments and other critical care,” said APTA President and CEO Paul P. Skoutelas.

The infusion of funding comes as agencies of all sizes are feeling the financial pressure to keep their systems operational for essential workers and riders who need to make essential trips, such as to get groceries, but the reduction in fare revenues and anticipated lost sales tax revenues coupled with added cleaning costs have pushed several transit providers to the limit. TransitCenter determined in a recent analysis that the cumulative impact on U.S. transit agencies could be between $26 billion to $38 billion depending on the extent of social distancing policies.

The funds provided in the CARES Act can only be used to prevent, prepare for and respond to coronavirus. Language in the bill also states operating expenses related to the response to the pandemic is eligible for this funding. Additionally, transit agencies would be able to be reimbursed for operating costs accrued from Jan. 20, 2020, to maintain service and lost revenue due to the pandemic, including the purchase of personal protective equipment and paying administrative leave for operations personnel due to a reduction in service.

“During times like this, we as a nation realize and appreciate the vital role the transportation infrastructure plays in the ‘supply chain’ to stock our grocery stores, get needed medicine and equipment to hospitals, and allow the rest of us to carry on our daily lives,” said Secretary of Transportation Elaine Chao. “The President’s signing of the CARES Act ensures that critical federal resources will soon reach where they are needed and help workers across the nation’s transportation system.”