KBRA releases a report examining the sluggish recovery of U.S. mass transit, which continues to lag pre-pandemic levels. The report also reviews the recovery trends of the five largest transit agencies we rate, and it assesses the ridership lag’s effect on transit bonds in KBRA’s complete rated universe.

Key drivers of this slow recovery include increased remote work arrangements and heightened safety concerns among riders. Fare box monies remain depressed, but transit agencies’ revenue bonds remain generally well protected by pledges of additional revenues other than fare box collections.

Key Takeaways

• Mass transit ridership is only about 60% to nearly 70% of pre-pandemic levels, with even lower results in train ridership at some agencies.

• Recovery trends in transit ridership are not uniform across major transit systems. The rail rebound is more challenged in Washington D.C., and to a lesser extent Chicago, than in New York City and Los Angeles.
• To date, higher gas prices have not meaningfully improved transit ridership despite the cost incentives of opting for subways or buses.
• Additional revenue sources, such as sales taxes, protect outstanding transit bonds from still pressured fare box collections.

Click here to view the report.

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About KBRA

KBRA is a full-service credit rating agency registered in the U.S., the EU and the UK, and is designated to provide structured finance ratings in Canada. KBRA’s ratings can be used by investors for regulatory capital purposes in multiple jurisdictions.

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