Mass Transportation Story : Financing of Buses

One has to wonder, given the statistics here on bus use, why local and state agencies continue to want trollies and trains that have been proven to be financial disasters?

The Big Business of Buying Buses
Source: U.S. Government Accountability Office, "Public Transit: Updated Guidance and Expanded Federal Authority Could Facilitate Bus Procurement," A report to the Honorable Matthew Cartwright, House of Representatives, September 2015.

October 1, 2015
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Buses are critical to the nation's public transportation services. According to data from the Federal Transit Administration's (FTA) National Transit Database, buses carry more passengers than all other modes combined. FTA provides grants to transit agencies to buy buses. When making these purchases, agencies must comply with a range of federal requirements.

Overall, the number of manufacturers of transit buses has declined in recent years, but bus production has remained constant. Transit agencies purchase over 5,000 buses per year -- about half are heavy-duty buses and half are smaller buses called "cutaways" because they consist of a bus body on top of a chassis built by another manufacturer.

• The number of firms that produce most heavy-duty transit buses declined from 10 in 2004 to 4 in 2013, due to business failures and consolidation.
• The number of buses procured annually by transit agencies from 2009-2013, using grant funds other than American Recovery and Reinvestment Act funds, ranged from 4,670 to 5,652.
• The amount of Federal Transit Administration's (FTA) grant funding for bus procurement increased from $794 million in 2009 to $1.3 billion in 2013.

Officials reported that it is time consuming to comply with a requirement to certify that at least 60 percent of the bus's components are made in the U.S. because the agency must conduct pre-and post-award reviews of bus manufacturers. Transit agency officials in four of six discussion groups also identified the procurement process as difficult and resource-intensive, particularly for those transit agencies that do not purchase buses each year and may lack procurement capacity.

According to FTA and GSA officials, both agencies have explored the feasibility of establishing a process to allow transit agencies to procure buses through GSA, but neither agency has developed a legislative proposal requesting that Congress grant authority to allow transit agencies to do so.