Public transportation agencies in Chicago, New York and Seattle are using different funding strategies to address budget gaps, rising construction costs and growing demand for transit services.
Leaders from the three cities discussed their approaches during a panel at the American Public Transportation Association’s TransForm conference in Chicago on October 5, 2026. Their experiences highlighted how public funding, new revenue sources and long-term financial planning can help keep major transit projects moving forward.
Chicago Secures $1.5 Billion for Public Transit
Chicago’s regional transit system faced a major funding shortfall as ridership remained below pre-pandemic levels. Without additional support, the region projected a budget gap of more than $770 million in 2026, potentially growing to $1.2 billion in 2027.
Thomas McKone, chief financial officer and treasurer of the Chicago Transit Authority, said officials worked to show state lawmakers how essential public transportation is to the region.
The funding gap threatened major service cuts, higher fares or a combination of both. Transit officials urged state lawmakers to consider approaches used in other U.S. cities and Europe.
The effort resulted in $1.5 billion in public transportation funding and support for transit-oriented development. Illinois also restructured regional transit management through the creation of the Northern Illinois Transit Authority.
New York’s Congestion Pricing Generates Revenue
New York City is using congestion pricing to reduce traffic in Manhattan while raising money for public transportation.
Introduced under a 2019 state law, the program faced legal challenges and opposition from the Trump administration. Critics also raised concerns about its potential impact on local businesses.
However, Jai Patel, chief financial officer of the Metropolitan Transportation Authority (MTA), said the region’s economy remained strong during the program’s first year.
According to Patel, transit ridership increased while vehicle noise complaints, traffic crashes, injuries and deaths declined.
The program has also met its revenue targets while operating costs came in below projections, Patel said. The MTA sees congestion pricing as an important source of funding for transit improvements and operations.
Seattle Expands Light Rail Despite Rising Costs
Seattle’s Sound Transit is continuing to expand its regional transportation network through a mix of voter-approved funding and dedicated taxes.
In March 2026, light rail service began crossing Lake Washington on a floating bridge, connecting downtown Seattle with Mercer Island, Bellevue and Redmond. The Crosslake Connection has helped expand the network’s reach, with the system carrying more than 160,000 riders daily, according to Victoria Baecher Wassmer, Sound Transit’s deputy CEO for finance and business administration.
Sound Transit receives funding through sales and use taxes, excise taxes, a car rental tax and property taxes. Voters approved major expansion plans in 2008 and authorized a further system expansion through a 2016 ballot measure.
The agency is planning to nearly double its track mileage by 2052, while also expanding commuter rail and bus rapid transit services. However, inflation has increased project costs, forcing officials to delay some work.
Wassmer said the agency continues to move forward with its light rail projects despite these financial pressures.
Funding Strategies Will Shape Future Transit Construction
The three transit systems show how major infrastructure programs depend on reliable funding and careful financial management.
Chicago secured additional state support to address operating shortfalls. New York is using congestion pricing to generate revenue while managing traffic. Seattle is relying on dedicated taxes and voter-approved funding to expand its transportation network.
For the construction industry, these approaches matter because funding decisions affect project schedules, infrastructure investment and the long-term pipeline of transit work. As construction costs rise, transit agencies will need to balance expansion plans with available revenue and the cost of maintaining existing systems.
