CARES Act Adds $25 Billion for Public Transit

Model 1 | April 17, 2020

A row of city buses parked.

Transit providers have seen a drastic decrease in ridership and revenue as a result of social distancing, while incurring unplanned costs for health and safety. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. Among other emergency support, the CARES Act provides $25 billion to the transit industry to help prevent, prepare for, and respond to COVID-19.

Funding Distribution and Amounts

Funding will be distributed using the following Federal Transit Association (FTA) formulas:

  • Urbanized Area Formula (5307) — $22.7 billion
  • Rural Formula (5311)  — $2.2 billion
    • Includes $30 million for Tribal Transit Formula (5311c) 
  • Administration and Oversight — $75 million

Eligible Expenses

Expenses incurred beginning on January 20, 2020:

  • Planning & Capital Expenses
    • Rolling Stock, Equipment, Preventative Maintenance
  • Operating Expenses
    • To Maintain Service — Driver Salaries, Fuel, General Operating
    • Lost Revenue Due to COVID-19
    • Purchase of Personal Protective Equipment
    • Paying Administrative Leave of Operations Personnel
  • All activities normally eligible under the Urbanized Area and Rural Area Formula programs

Funding Highlights

  • Funding Share: Funding will be provided at a 100% federal share, with no local match required.
  • Fund Availability: Funds can used to pay for expenses on or after January 20, 2020 and do not expire. Funds are available until expended. Transit Systems are encourages to spend funds promptly to respond to local needs.
  • No Limits On Use of Funding: There is no limit on the amount of funds that may be used for operating expenses, or paratransit service.
  • Program Requirements: All normal requirements under the Urbanized Area (5307) and Rural Area (5311) Formula programs apply to funds made available under the CARES Act, with the exception to TIP/STIP.
  • Exception to TIP/STIP: Some capital and operating expenses do not need to be in the TIP/STIP. Bus replacement is not required to be in the TIP/STIP. Fleet expansion is required to be in the TIP/STIP.

We are here and want to help support our customers however we can. Please contact Creative Bus Sales today at 888.633.8380 and let us know what we can do to help keep you moving.