Op-Ed: How Transit agencies are resisting fiscal cliffs and doom spirals

As COVID-19 relief funds run out, transit agencies across the U.S. are coming to the edge of a fiscal cliff and scrambling to avoid a doom spiral that would decimate rail services in cities like Chicago and Miami.

In a doom spiral scenario, budget and service cuts lead riders to choose alternative modes of transportation, often cramming back into car traffic, which in turn leads to further service cuts. Of course, the damage likely wouldn’t stop there. If employees fed up with an endless commute relocate to other cities, businesses and tax dollars follow and the entire metro area stagnates as a result.

That’s the doomsday scenario that commuter rail leaders in Florida and Illinois, among other states, are desperate to avoid with federal funds set to dry up in 2026.

Dave Dech, executive director of the South Florida Regional Transportation Authority (SFRTA), and Jim Derwinski, CEO of Metra in Chicago, are leading the charge to find long-term solutions to the U.S. passenger rail funding challenges. They recently shared several best practices for marshalling support and avoiding the cliff.

Here’s how commuter railroads are keeping this vital service, which moves millions of riders each year, on the tracks.

A crisis decades in the making

The troubled financial situation many transit agencies are in right now is not a new development, nor is it the result of mismanagement.

In Chicago, Derwinski points to a stagnant math equation as a major source of their budget issue. The operating dollar formulas that decide which tax dollars go toward public transportation have not changed since 2008 and do not account for shifts like suburban sprawl or the pandemic.

The result? A $730 million hole in the regional mass transit budget. While local leaders are considering opportunities to consolidate the city’s four separate transit agencies, Metra’s CEO would also like to revisit those operating formulas every five years to avoid recurring fiscal cliffs.

In South Florida, Dech is facing a fiscal cliff in local and state funding in addition to federal relief from the COVID-19 pandemic running out. The funding that Dech’s commuter railroad receives from the Florida Department of Transportation (FDOT) has been frozen at the same level for years, with no adjustments for inflation. The state has long wanted the local counties in SFRTA’s service area to pay a larger share of the railroad’s costs. Now, Florida wants those counties to pay the entire cost.

The funding mechanisms for the railroad in South Florida haven’t been negotiated since the railroad began as a temporary service while construction crews worked on I-95 in 1989 — more than 35 years ago. That temporary service proved so successful that FDOT made it permanent, but funding hasn’t kept pace. Both Metra and the SFRTA are scheduled to run out of funds in 2026 if lawmakers do not act. 

How transit leaders are marshalling support to save their services

As Dech sets out to convince local officials to fund his railroad, it helps that SFRTA has a great story to tell. The commuter rail service is leading the U.S. in ridership recovery since the pandemic and expects to break its record by serving over 4.5 million passengers in 2025. In Miami-Dade County, a developer is building a $3 billion mixed-use district with thousands of affordable housing units around a new SFRTA station. Dech is leveraging that goodwill to keep his funding.

Dech is quick to point out that SFRTA’s ridership represents an entire lane of traffic in either direction on I-95—the region simply can’t afford to put those riders back into highway traffic. The agency’s strong ridership recovery is helping make his case.

In Chicago, Derwinski emphasizes that rail is a necessity for the region to meet its climate goals, but in addition to cleaning up the environment with every train Metra runs, he also points to how the railroad decongests the roadways, delivers better economic returns for residents and businesses near stations, increases housing values along its route and ferries people to and from universities and hospitals. The return on investment (ROI) is clear. 

Finding structural solutions, not short-term stopgaps

In the absence of federal support, fixing the funding woes will require a concerted effort from the agencies and local and state lawmakers. Metra and SFRTA are presenting a variety of solutions to their backers, including special tax districts around the railroad, wholesale property taxes, cell phone taxes, rental car taxes or sales taxes dedicated to transit. Rail leaders want to be able to make long-term plans around maintenance and new equipment rather than continue to live hand-to-mouth.

Both Dech and Derwinski remind people that commuter rail is not intended to make a profit, it’s a public service that should be viewed as a utility. Is that service important enough to their communities to properly fund it?

Metra needs state legislators to budget for a solution before federal relief money is exhausted. Derwinski is tasked with convincing politicians—some of whom represent districts outside Metra’s service area—of commuter rail’s value and the importance of a structural fix. The railroads mean too much to riders and the region’s economy to let them rust away.

If solving these funding challenges was easy, commuter railroads and their legislative backers would have fixed it a long time ago. Implementing long-term, structural solutions will require a collaborative effort from riders, regional authorities and state governments that understand the ROI that railroads deliver, especially now that the federal government is stepping back. 

Commuter rail is a public utility we cannot allow to drive over the fiscal cliff. Our political leaders must act to sustainably fund this service now and for years to come.