Consolidated Appropriations Act of 2026 becomes law, funds transit through Sept. 30

The Consolidated Appropriations Act of 2026, which included the Transportation, Housing and Urban Development, and Related Agencies Appropriations Act, 2026 (THUD Act), was signed into law by President Donald Trump on Feb. 3.

Passed by both chambers of Congress last month, the THUD Act, in part, fills federal transit funding coffers with $21.1 billion for public transit for fiscal year (FY) 2026—an increase of over $160 million from FY 25—as well as $15.9 billion for passenger and freight rail—a decrease of just shy of $300 million from FY 25.

The package funds Federal Transit Administration (FTA) transit formula grants to the tune of $14.6 billion for FY 26 from the Mass Transit account of the Highway Trust Fund that will be available until its expended. This funding covers essentially all major formula programs that fall within the purview of transit. The package does not, however, give any new contract authority.

Greenlit in the package was $1.7 billion in funding for the Capital Investment Grants (CIG), providing over $1.3 billion for New Starts and Core Capacities, while still allocating $200 million for Small Starts, over $25 million for project delivery and engineering support and $100 million for FAST Act pilot projects. Congress has locked the funding to a specific allocation table, not allowing the U.S. Department of Transportation (USDOT) to adjust funds more than 10% into differing categories and forcing it to deliver funds within 120 days of the package being signed into law—June 3, 2026.

A little over $200 million was also appropriated from the general fund for transit infrastructure grants—things like ferry grants, bus testing facilities and the Accelerating Innovative Mobility Initiative grants, along with a host of other earmarks.

New funding comes with new rule changes

The appropriations package also updated and changed rules for how money is controlled and can be disbursed. Like with National Infrastructure Investment discretionary grant funding, the $145 million in funding is seated with USDOT and the new package outlines how the department must dole out funds. This includes:

• What the funds can be spent on such as capital projects, multimodal projects that include transit or for the planning, preparation or design of future transit investment.
• Removing minimum or maximum grant size rules, including imposing no minimum cap on planning projects.
• Adding a 5% or greater rule for funding to go to disadvantaged communities and capping the funding split to 50% for rural and urban projects.
• Imposing a priority status to projects that require a contribution of federal funds to complete its funding package.

The package also laid out rules for how the FTA must administer the funds once they’re released to it. Potentially most importantly, the obligation limits do not apply to old money, meaning it won’t expire due to sunsetting caps. Further, it may roll old funds forward under the new package, allowing for administrative simplification. It also deprecates old rules, like no longer being allowed to slow or block CIG projects because the federal share exceeds 40%, or because the revenue would not be made up in the Highway Trust Fund.

Major event transit funding

The freshly signed act also delivers additional funding to support transit for major events, including just over $100 million for host cities of the 2026 FIFA World Cup and just over $94 million to support transit for the 2028 Summer Olympic and Paralympic games in Los Angeles. Funding for the World Cup will be issued based on formulas accounting for stadium capacity and match count and can be used for operational expenses.

Funding for the 2028 Olympics is coming at a share of 80% federal funding and 20% local funding, except for supplemental bus support, where federal funding will account for 90% of available funds. Los Angeles County Metropolitan Transportation Authority (L.A. Metro) notes that funds will allow it to keep working on its Games Enhanced Transit System (GETS), including in service planning, land leasing costs, designs for temporary facilities, station improvements, mobility hubs and light rail improvements.

“We appreciate the leadership from the California Congressional delegation, including Senators Alex Padilla and Adam Schiff and Representatives Pete Aguilar and Norma Torres on the House Appropriations Committee for their support of this critical funding,” said L.A. Metro Board Chair Fernando Dutra. “This bipartisan effort, which also included support from Secretary [Sean] Duffy, Administrator [Marc] Molinaro and the staff of the U.S. Department of Transportation, will be essential for success. We look forward to collaborating with the federal government to deliver a world-class experience for everyone coming to the 2028 Olympic and Paralympic Games.”

Support for regional and alternative transit offerings

The appropriations act also funded smaller, regional projects, like GoTriangle, which received $2 million in Community Project Funding in part for a new Triangle Mobility Hub (TMH). The hub will be an intermodal transit center that will connect various transit offerings under one roof for residents and visitors of Research Triangle Park, N.C.

The TMH is being designed to link together bus, paratransit and microtransit services with future projects, like a bus rapid transit network, passenger rail and the Triangle Bikeway. The hub will expand GoTriangle’s ability to offer service, allowing for future expansion plans that would connect passengers with healthcare, jobs, school, shopping and recreational activities that the current system does not connect to.

“As our area continues to experience rapid growth, accessible and reliable transportation is essential to connecting people to opportunity and keeping communities moving forward,” said Rep. Valerie Foushee (D-NC-4). “By improving access to jobs, education and healthcare, the Triangle Mobility Hub will strengthen regional connectivity and ensure our transit system works for everyone. I’m proud to help secure federal funding for this project and support smart, sustainable growth across the Triangle.”

Down south, the Pinellas Suncoast Transit Authority (PSTA) received two streams of funding as part of the package to support and expand ferry services in the region. The first is $850,000, sponsored by Rep. Kathy Castor (D-FL-14), that will enable the agency to build a permanent ferry dock for the Tampa Bay Ferry. The new dock will allow for a connection between St. Petersburg, Fla. and Tampa, offering what the PSTA calls efficient public transit while hoping to spur economic development, increase tourism and reduce local on-road congestion.

“Thank you to President Trump, the [USDOT] and Congresswoman Castor for their leadership and vision to help bring reliable and sustainable waterborne transportation to the Tampa Bay Region,” said PSTA CEO Brad Miller. “This investment creates lasting regional infrastructure that gives residents and visitors more transportation choices, and fuels economic activity along our waterfront communities.”

The second stream, $828,000 sponsored by Rep. Anna Paulina Luna (R-FL-13), would restore a transit link between Dunedin, Fla., Downtown Clearwater and Clearwater Beach with dock refurbishment and operations support.

“Restoring the Dunedin Ferry Dock and strengthening the Clearwater Ferry service ensures that our coastal communities remain accessible, connected and economically vibrant for years to come,” Miller added.

Passage and further transit funding

To pass the legislation, Congress separated out funding for the Department of Homeland Security from the Consolidated Appropriations Act of 2026, re-passing the Senate-amended version on Feb. 3 before it was signed into law by the president on the same day.

While the act covers yearly transportation appropriations, the country is also approaching another transit funding deadline, the expiration of the Infrastructure Investment and Jobs Act (IIJA) in September, the multi-year surface transportation reauthorization bill. The new bill is in the works with hearings being held in both the House Transportation and Infrastructure and Senate Environment and Public Works committees.

House Transportation and Infrastructure Committee Chair Rep. Sam Graves (R-Mo.) said during last year’s government shutdown that he intended to have the bill marked up and off the House floor “around Spring.”