A Trip Down Memory “Train”: A Brief History of Public Transit

March 21, 2024 | 10:30 am
Thomas J. O'Halloran/Library of Congress
Kevin X. Shen
Northeast Transportation Policy Analyst/Advocate

Being able to get from place to place is the foundation for a thriving community and sets the stage for growing our economy and upward mobility. For more than a century, the United States has recognized this, and maintaining roads and bridges has been a core function of federal, state, and local governments. While public transit is also a key option in getting around, it has suffered from chronic disinvestment despite its many community-wide benefits, and the current system leaves many of us disconnected, especially those who have long been divided by highways and borne the brunt of the cumulative impacts of environmental pollution. The federal government embraced a role in supporting transit in the 1970s, but this was cut back for the past 40 years and didn’t rebound until the pandemic.

Meanwhile, vested interests have worked to maintain the status quo of asphalt and sprawl: from funding for ever expanding highways, to the personal costs most people in the United States take on by owning a vehicle, to land use policies that restrict compact communities. These corporations and politicians don’t want to see a transformational transportation system we need, one that prioritizes people before highways, health before harm, access before asphalt, climate before corporations, freedom over fossil fuels.

How did we get here? Why aren’t there more ways to get around my community? What is keeping us behind? Let’s start with a short history lesson…

Even in the golden era of transit, not everyone was on board.

The way the story goes, in the late 1800s and early 1900s, the streetcar era was in full bloom, run by private companies with an oligopoly on getting around. Combined with real estate speculation on newly accessible land, these early transit systems turned a short-term profit. However, in the decades that followed, city, state, and federal politicians, along with private sector interests made intentional decisions that locked in car-dependent infrastructure, starved city investments often on explicitly racist grounds, and promoted white flight to the suburbs. This especially devastated low-income communities of color where many people could not afford to drive.

A swirl of different trends ultimately strained city streetcar systems’ financial books by the 1930’s:

  • After short term land speculation, transit companies often had declining interest in lines and let them deteriorate.
  • Sprawling development with policy decisions for zoning that restricted buildings to single-family homes made future real estate speculation less viable.
  • Contractual arrangements with streetcar companies required them to maintain roads that were worn by cars, and also required them to not raise fares amid inflation.

Coupled with these strains, streetcar systems were a part of public space that excluded Black people. Throughout the 1800s, there was no place in the United States that allowed Black people to travel in the same class as white people. In other words, they were relegated to second class accommodation. Well before Rosa Parks, leaders such as Fredrick Douglass and James Buffum in Massachusetts (1841), Elizabeth Jennings Graham in New York (1854), Charlotte Brown in San Francisco (1863), and Kate Brown in Washington DC (1868) protested their inferior treatment and set off Black-centered transportation movements for equitable access to dignified transportation.

Public transit funding fills a gap made by decades of bad decisions.

In response to financial pressures, some city governments took over transit operations as private companies up and left (e.g. Boston and San Francisco) as early as the 1920s, while in many places transit pretty much disappeared (e.g. the final Los Angeles streetcar stopped service in 1961). Even with municipal support, the systems that survived were desperate for funding.

In response, the Urban Mass Transportation Act of 1964 authorized a significant portion of federal funding for transit–$375 million over three years, about $3.7 billion dollars in today’s dollars– and kickstarted the trend of federal assistance for capital projects such as buying new vehicles or building new rail lines. This was the start of the federal government’s role in transit, and created the agency that is now known as the Federal Transit Administration (FTA).

Federal funding for new transit projects increased in the following years, though operations funding, used for everyday expenses like paying bus operators or for maintenance, was increasingly inadequate. Transit went through its first fiscal cliff in the 1960s and ‘70s, following a period of lower ridership and decreased fare revenue and overemphasis on capital assistance over operations funds. Many transit systems went bankrupt or made drastic cuts to service, starting a vicious cycle. Ultimately, with the oil crisis of 1973 spotlighting the importance of transit, Congress filled the gap with $4.8 billion of federal operating funds over 6 years (around $25 billion equivalent today), and ridership stabilized and even made small gains. With federal capital assistance, many cities (including Washington, D.C., the Bay Area, and Atlanta) also built new rail systems in this era.

Funding for transit operations was inadequate in the 1960s and 1970s. By 1976 the American Public Transportation Association was warning of billion-dollar deficits across transit operators. Reproduced from APTA.

In rural areas, people in poverty, older adults, and people with disabilities became increasingly stranded. “To be without a car in rural America meant chronic isolation”. The first federal pilot program for rural transit had funds out the door in 1979, and soon after Congress created a dedicated funding program for rural areas, though in the coming decades rural transit would be characterized by growing demand and insufficient resources.

Tribal transit is often grouped with rural transit given that many tribes are in rural areas, but is different given the sovereign government-to-government relationship between tribes and the federal government. This is often known as the trust relationship, where the federal government is legally obligated to provide services such as transportation to tribes with federal recognition, though those services are often inadequate given the harrowing history of government-sanctioned injustices. Rural transit funding from the 1970s included eligibility for tribes but passed through states, while tribes maintained a sovereign, direct relationship with the federal government. This led to an unfair distribution of funds until the FTA’s tribal transit program was implemented in 2006 with a direct funding and application route to the federal government. These systems continue to be incredibly important––“far from being a mere detail in the tribe’s efforts to improve their material well-being and standard of living for their members, viable transit systems is the glue that holds tribal economies and societies together”.

All the while, the history of redlining and segregation, construction of the interstate highway system, and disinvestment from urban neighborhoods were shaping how we move. Racism in public transit compounds these injustices, with subpar transit service for Black and brown riders and a disregard for their safety in public space.

Transportation planning settled into status quo through the 1990s.

The presence of federal transit funding was under constant attack throughout the 1980s. This time was characterized by a push to decrease the federal government’s role in local issues such as transit and instead focus on highways. The Reagan administration aimed to completely nix federal operating funding and wound up cutting federal transit spending by $476 million ($1.5 billion in today’s dollars). Congress was luckily able to stave off the worst of these effects but did impose limits on federal operating support that led to its gradual decrease through the 1990s.

The Intermodal Surface Transportation Efficiency Act of 1991 (ISTEA, pronounced like Ice-T), and the Transportation Equity Act for the 21st Century in 1998 (TEA-21) both almost doubled federal transit support, the biggest increase since 1964, but eliminated operating assistance. While the total numbers increased in absolute terms they failed to keep up with inflation and the federal share of transit funding continued to decline to only 15% in the 1990s. Though, these made some landmark changes to the way transportation planning is done. ISTEA required long-range plans and entrusted metropolitan planning organizations (MPOs) to coordinate federal funding, a significant shift in decisionmaking away from states. It also allowed for “flexing” funding between different programs (e.g. from highways to transit), a key potential funding mechanism for sustainable transportation investments to this day.

Subsequent federal transit funding bills generally followed the status quo, in which highways get a much greater share of funds than transit, and barely keeping pace with inflation and transit industry operational, managerial, and political factors that increase costs even higher. They did though make some needed planning reforms, such as the Moving Ahead for Progress in the 21st Century Act (MAP-21) in 2012, which initiated a wave of performance-based planning through tracking and reporting progress on measures related to safety, infrastructure conditions, congestion, project delivery, and environmental sustainability. The Federal Highway Administration’s greenhouse gas performance measure, finalized in late 2023, is one example of this data-driven approach.

The federal role in transit has declined since the 1980s, and current levels of transit expenditures are expected to decrease from 2021, though the Bipartisan Infrastructure Law does increase transit funding from 2019 levels. Source: Congressional Budget Office (1956-2017) and my own analysis (2018-2023), using data on federal transit outlays from OMB’s Public Budget Database, state and local transit expenditures from the US Census Bureau (up to 2021, no data afterwards), and GDP Price Index from the Bureau of Economic Affairs.

We got what we paid for—it wasn’t great. Now it’s time for a change.

With decades of low commitment to transit and instead investing in car dependence, transportation is now the largest sector of US greenhouse gas emissions, is the second largest household expenditure, and remains a key factor perpetuating inequities in our country. Now is the time to act—we need to electrify our vehicles, clean up our transportation fuels, and invest in transportation options and walkable neighborhoods to help us all thrive.

One example of us banding together to push for change was during the early years of the COVID-19 pandemic. At that time, we recognized that public transit is critical for essential workers and by proxy, everybody.  With a renewed push from transit and environmental advocates across the country, Congress passed a one-time infusion of $69 billion for transit operations expenses to keep our systems running. As that funding runs out, it’s time for us to advocate for a longer-term source of operations funds for transit to not just survive, but help us all thrive.

The Bipartisan Infrastructure Law passed in 2021 and was the most recent time Congress made significant changes to transit funding and policy. This, along with the Inflation Reduction Act and the Justice40 Initiative, represent substantial possibility for investments in climate and equity. However, in the world of transit, the benefits of the 79% increase in federal funding can be easily undermined by the 90% increase in road funding that, if put to highway expansion, could backtrack progress. This is the vested interest of the highway lobby–fossil fuel, construction, asphalt and material, and automotive companies that profit from limited options, high household transportation costs, and more driving. In addition, by our calculations less than 30% of transit and transportation programs are covered by Justice40’s limited scope and even those bring concerns about implementation. While Justice40 is one important step, we must continue to advocate for equitable transportation investments across the country.

Through history, we’ve seen transit’s story as not only one of deprivation of an essential public service, but also one that is mired in injustices that have left many of us forced to move or stuck in place, but especially people of color, people with disabilities, and with low incomes. Investing in transit is an integral strategy to a prosperous, equitable, and sustainable future, and will require us to stand up for a system built for people, not cars, as we write our next chapter.