The COVID-19 pandemic plunged the nation into a once-in-a-lifetime recession, triggering unprecedented levels of federal spending to provide direct relief to the American people, small businesses, and local governments. The most recent federal stimulus bill passed in December included funds for various transportation sectors.

What Federal Stimulus have DOTs and Transit Agencies Received?

Congress passed $900B in COVID-19 relief measure on December 21, 2020, which included $45B for transportation. All in all, the bill included:

• $15B for airlines

• $14B for public transit

• $1B for AMTRAK

• $10B for state highways

How Can the Federal Funds Be Used?

The $10B investment represented the first federal relief contribution to owner-operators of state roadways, like ODOT. Based on AASHTO review of the legislation, the relief money can be used to fund:

• Surface Transportation Block Grant-eligible projects

• Preventative maintenance

• Routine maintenance

• Operations and personnel

• Debt payments

• Availability payments

• Coverage for revenue losses.

Funds made available for maintenance, operations, and personnel are not required to be included in state transportation improvement programs or metropolitan transportation plans, and federal share of costs shall be up to 100%. The funds remain available until September 30, 2024.

Why was a Federal Stimulus Needed?

Federal stimulus was needed to make up for losses in state highway programs as a direct result of the pandemic. Public health orders implemented to curb the spread of COVID-19 caused reductions in statewide traffic volumes, as low as 44% decrease this past spring compared to the previous year. Travel volumes remain below 2019 levels.

As a result, motor vehicle fuel consumption is also down statewide. Between March and November 2020, ODOT reported a $200M loss in Motor Vehicle Fuel Tax (MFT) revenue. The agency continues to predict a 9% ($174M) shortfall in 2022, and an 8% ($159) reduction for 2023.

How is the Federal Stimulus Being Used in Ohio?

ODOT received $333M from the December federal stimulus bill to replace lost revenue and continue to provide needed services. Of that allotment, $126M was passed on to local governments to make up for pandemic-related losses in revenue. Most of the $206M that was retained by ODOT was used to restart major/new construction through the TRAC program, which funds projects that aim to improve capacity/reduce congestion, that was paused over the summer in order to conserve resources.

How has Federal Stimulus Impacted Transit Agencies?

While state departments of transportation only just received aid from the federal government, transit agencies across the country were first helped over the summer. The $14B available to public transit agencies through the December stimulus bill came in addition to $25B previously allotted through the CARES Act in March 2020. The most recent $14B in relief falls short of the $32B that experts and transit advocates called for.

The same public health orders that impacted traffic volumes throughout 2020 caused public transit ridership to plummet. Overall demand for public transit dropped about 73% nationwide, though several factors affected demand from city-to-city. While many commuters now were now working from home, transit agencies across the state never stopped providing service to connect essential workers and the public to jobs, medical appointment, or food. The loss of ridership revenue was coupled with increased and unforeseen costs to regularly sanitize buses and equipment, while also having to providing bus operators with adequate PPE.

The COVID-19 pandemic was particularly harmful to small and rural transit agencies, many of whom don’t have dedicated local funding sources and have to rely on advertisement and service contracts with local employers or county agencies. CARES Act funding provided last spring helped many Ohio transit agencies fill massive holes in their operating budgets as COVID affected their ridership, decreased revenues, and increased expenses.

Federal Stimulus is Critically Helpful but It Doesn’t Negate the Need for Sufficient and Regular State Funding

It would be misleading to consider a one-time increase in federal funding for transit as replacement for regular state investment. Transit agencies across the state have used stimulus from the CARES Act and December bills to support payroll, maintain service levels, as well as increased costs associated with meeting COVID guidelines, like purchasing PPE and disinfectants. You can read about the experiences of Ohio agencies like Lancaster-Fairfield Public Transit, or Stark Area Regional Transit Authority, and others who testified on the need to maintain funding levels for public transit to the House Finance Committee last week. Just as ODOT is not being penalized for receiving federal stimulus, lawmakers should not view federal funding as a replacement for state funding commitments towards public transit.