Despite increased ridership, clear benefits to the environment and traffic congestion mitigation, public transportation continues to face financial struggles and cuts. But some states are turning to alternative financing mechanisms to fund it.
Public transportation ridership is growing.
- Americans took 10.7 billion trips on public transportation in 2008, 400 million more than in 2007.1
- Ridership was the highest in 52 years and set a modern ridership record. The increase occurred despite falling gas prices, lost jobs and an economic recession.1
Despite increased ridership, clear benefits to the environment and traffic congestion mitigation, public transportation continues to face financial struggles and cuts.
- Most rail transit vehicles and trolleybuses are electrically propelled and emit little or no pollution. Many newer buses are fueled by alternative fuels.2
- Current public transportation usage reduces U.S. gasoline consumption by 4.2 gallons each year.3
- Congestion reduction due to public transportation saves 340 million gallons of gasoline a year.2 Transit-related congestion relief saves $19.4 billion annually.4
- State governments, which provide the largest percentage of funding for transit, are facing declining tax revenues, which has meant that many transit systems have been forced to increase fares, reduce service and lay off workers. A report by Transportation for America tallied such cutbacks in 85 communities across the U.S.5
However, some states are increasing funding and turning to alternative financing mechanisms to fund public transportation.
- States provided $13.3 billion in funding for transit in the 2007 fiscal year, $2.2 billion more than in 2006. Forty-six states provided funding for public transportation in 2007. Thirty-two states increased funding—seven states by more than 75 percent. Three states cut funding by anywhere from 31 to 100 percent.6
- The most common major source for overall transit funding in 2007 was the gasoline tax. Seventeen states relied on it for at least a portion of their transit funding, while three states relied on it for 100 percent. Since motor fuel taxes are generally applied on a per-gallon basis, and not as a percentage of the total sale price, some question the adequacy of the fuel tax as a revenue source as improvements are made in fuel efficiency and more people use public transit.6
- Seven states in 2007 relied on a general sales tax for at least a portion of their transit funding. Three states relied on it for 100 percent of state transit funding.6
- Ten states relied on a motor vehicle/rental car sales tax for funding, with Iowa relying on it for 100 percent of transit funding.6
- Seven states relied on registration, license and title fees for at least some portion of transit funding. Montana relied on those fees for 90 percent.6
- Four states relied on lottery or casino revenues for some transit funding.6
Download the Excel Version of the Table: "Major Sources for Overall Transit Funding, 2007"
1 American Public Transportation Association. “10.7 Billion Trips Taken on U.S. Public Transportation in 2008.” March 9, 2009.
2 APTA. “2008 Public Transportation Fact Book.” June 2008.
3 ICF International “Public Transportation and Petroleum Savings in the U.S. Reducing Dependence on Oil.” 2007
4 APTA. “Critical Relief from Traffic Congestion.”
5 Transportation for America. “The United States of Transit Cutbacks.”
6 American Association of State Highway and Transportation Officials. “Survey of State Funding for Public Transportation.” 2008.