The transit industry gets a lifeline through new COVID relief funding bill
The nation is breathing a sigh of relief now that Congress has passed a $900 billion pandemic relief bill. Transit agencies across the country, including the Regional Transportation District (RTD), will be aided through a collective $14 billion for transit. It is not yet known how much RTD will get of those funds, but the federal funds will help RTD grapple with a $140 million shortfall in its 2021 budget. The Board has approved the 2021 budget, which includes plans to eliminate about 350 positions through layoffs and cut additional vacant positions in both operations and administrative staff.
The new funds will be available for operating expenses to “prevent, prepare for, and respond to coronavirus,” including the purchase of personal protective equipment and payment for administrative leave of operations personnel due to reductions in service dating back to Jan. 20, 2020. Funds should be used for payroll and public transit service (as opposed to capital programs) to the maximum extent possible.
Last week, RTD received an endorsement of its $232 million in federal Coronavirus Aid, Relief, and Economic Security (CARES) Act spending during the pandemic, with consultants hired by the Denver Regional Council of Governments telling the RTD Accountability Committee the money went to support jobs, as required.
The Denver region was one of many large transit sites across the nation to receive revenue backfill from Congress earlier in 2020, with the intent of keeping jobs and preserving essential transit for as long as possible. The CARES Act required agencies receiving aid to spend the money on 2020 operations, and not bank it for capital projects or 2021 reserves, in order to support as many current employees as possible.
The CARES Act allowed RTD to avoid layoffs and position cuts for 2020 even as sales tax and farebox revenues plummeted. The agency cut January 2020 service levels by 40 percent in April in order to reflect reduced demand, and that reduced level could continue for much of 2021, the RTD Board of Directors has said.
Gov. Jared Polis and the state Legislature appointed the RTD Accountability Committee in July to review agency operations and future plans and seek consensus on a path forward. RTD has built out an extensive transit system with light rail, commuter rail, bus rapid transit and traditional bus lines, but also faced severe operator shortages and ridership losses before the pandemic hit in the spring.
Consultants told the committee on Dec. 14 that their review showed RTD fulfilling the spirit and the letter of the CARES Act, preserving jobs while also cutting nonessential positions and capital spending in order to protect the budget. The consultants said:
- RTD use of CARES Act funding appears to have been spent in alignment with FTA (Federal Transit Administration) intentions.
- RTD appears to have balanced provision of transportation options with responsibility to its workforce and regional economic stability in its funding decisions.
- Majority of CARES funding to date has been spent on employee wages for union and non-union employees.
- RTD appears to have worked to implement cost-cutting measures to reduce the funds required for continued operations as buoyed by CARES funding.
Success in filling budget holes for 2020, though, cannot eliminate 2021 budget deficits for RTD as ridership remains low from workers telecommuting, metrowide layoffs and business lockdowns. However, the additional relief funding will be a significant help as the CARES Act funding is expended and RTD continues to assess ridership and opportunities to better optimize service levels.