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After forcing workers back to the office, Goldman Sachs and JPMorgan Chase are now letting their staff work remotely—but only for the World Cup

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The Pentagon said Iran War costs $29 billion, but the real cost is closer to $200 billion—and counting

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Politics

It could take nearly a decade for public transit to return to pre-pandemic levels

By
Marco Quiroz-Gutierrez
Marco Quiroz-Gutierrez
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By
Marco Quiroz-Gutierrez
Marco Quiroz-Gutierrez
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November 2, 2021, 7:00 AM ET
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While the pandemic devastated many industries, one of the hardest hit was transportation.

In some of the biggest cities in the U.S. including New York, Chicago, and San Francisco, the public transportation systems are essential for workers, tourists, and everyday people.

The pandemic radically changed that situation.

With some workers confined to their homes and others nervous about contracting COVID-19 on public transportation, ridership numbers plummeted.

Bay Area Rapid Transit, BART, which serves San Francisco and the Bay Area, was servicing 420,000 riders per day pre-pandemic—twice the daily volume of those crossing the Bay Bridge at the time, BART general manager Robert Powers told Fortune.

Over the course of a few days of lockdown in March 2020, BART lost 90% of its ridership. With fares and parking fees making up about two-thirds of its revenue, the total loss amounted to about $1 billion.

But San Francisco’s transit system wasn’t the only one affected. Both the Chicago Transit Authority (CTA) and the Metropolitan Transportation Authority (MTA) in New York City saw ridership levels decline 80% and 90%, respectively. For all three transit systems together, losses were in the billions.

As of late October, national transit ridership was only about 62% of what it was pre-pandemic, according to the American Public Transportation Association.

With the U.S. vaccination rate slowly increasing and COVID cases dropping in many states across the U.S., transit systems have seen a slight recovery in ridership, still, nothing like pre-pandemic levels.

“If it wasn’t for the emergency relief funding that we got from the federal government, we would be having a very difficult conversation about transit service in Chicago,” noted Dorval R. Carter Jr., president of the CTA.

After the pandemic worsened in the U.S. in March 2020, the U.S. Department of Transportation’s Federal Transit Administration expanded its emergency relief program. Originally created to assist transit agencies struggling with natural disasters such as flooding and hurricanes, in March the agency expanded its purview to help transit agencies in states where the governor had declared an emergency owing to the COVID pandemic.

In early September, the Federal Transit Administration also announced an additional $2.2 billion in funding for select transit agencies that needed help with maintaining day-to-day operations, cleaning and sanitizing, or retaining staff.

Thanks to three COVID relief bills passed by Congress, the nation’s largest transit system, the MTA in New York City, is also getting $14 billion to keep its operations going, said Janno Lieber, acting chair and CEO of the MTA.

The funds will help for now, but the MTA still doesn’t know for sure what ridership will look like in the coming years. The organization conducted a study with the consulting company McKinsey that predicted a 10% to 15% shortfall in ridership that will persist for years, said Lieber. This decline equates to about $1 billion to $1.5 billion in structural deficit, he said, but the situation is still uncertain.

“Anybody who tells you they know exactly where this is headed is either a dope or they’re lying,” Lieber said.

In the Bay Area, BART’s Powers said that based on the organization’s projections, ridership won’t return to pre-pandemic levels for at least the next five to eight years.

Government funding provided much-needed relief as well for the CTA, which was one of the few large transit systems in the country that continued to run full service and did not lay off any employees, said Carter.

But transit systems can’t rely on government funds forever. All of them are eager to attract riders to their transportation options, and some have taken steps to lure customers back.

After losing nearly $1 million per day in fare revenue at the beginning of the pandemic, the CTA proposed fare cuts in its 2022 budget plan to try to lure back some riders. One-way fare prices would stay the same, but it proposed halving the price of a single-day unlimited ticket to $5 and reducing the price of an unlimited monthly pass to $75 from $105.

For the entire month of September BART also offered 50% off on all fares, Powers said.

With ridership habits changing from peak rush hour to other times as companies give workers more flexibility with their schedules, BART and other transit systems will have to adjust, said Powers.

“When somebody is coming back into the office, their first choice needs to be public transportation,” Powers said. “We need to be cleaned, we need to be safe, we need to be reliable, and we need to be their first choice.”

Despite the drastic declines in ridership seen by transit authorities up until recently, things seem to be slowly on the upswing for some transit systems. In New York City, subways are at about 55% of pre-COVID levels, buses at a little over 60%, and commuter railroads are at about 50%, Lieber said.

Although the future of ridership remains uncertain, Lieber said he is optimistic especially because of increased levels of ridership the MTA has experienced on weekends and in discretionary travel, which have reached about 65% to 75% of pre-COVID levels, he noted.

“The trend has been gradually but consistently upward since Labor Day,” Lieber said. “Virtually every week, we hit a new record in terms of ridership, so things are heading in a positive direction.”

Correction, Nov. 2, 2021: A previous version of this article misstated the name of the Metropolitan Transportation Authority.

More politics coverage from Fortune:

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  • Florida Gov. DeSantis offers $5,000 bonus to lure anti-vax police from out of state
  • 3 states limit nursing home profits in bid to improve care
  • The latest meme stock in the Trump SPAC wave: Phunware
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