Public transit authorities are vital to U.S. communities, relying on ticket sales, advertising, and federal and state funding to operate. The COVID-19 pandemic disrupted these funding sources, particularly ridership and fare revenue, triggering a financial crisis with which many transit agencies are still grappling.
Federal relief funds from the CARES Act and American Rescue Plan Act—totaling $55.5 billion—are predicted to run out by the end of this year. Meanwhile, ridership recovery remains incomplete. According to APTA's 2024 data, transit ridership has only reached 85 percent of pre-pandemic levels (88 percent in cities with populations < 100,000), with rail lagging behind buses at just 72 percent recovery. This gap between funding depletion and ridership recovery has left transit agencies facing significant budget deficits and rising operational costs.
This situation is also known as the Transit Fiscal Cliff—a challenge that 71 percent of major transit agencies are predicted to encounter within the next three years, if they haven’t already. Without additional funding, this cliff may force transit authorities to decrease services and increase fares, further reducing ridership and accessibility, especially for low-income and vulnerable populations.
To put it simply: Transit authorities must pivot to remain viable. They need alternative funding sources, such as public-private partnerships, local tax initiatives, or specific transit funding measures to mitigate these impacts. Securing this support means demonstrating a compelling business case for public transportation with improved cost management, operational efficiency, and attentiveness to local needs and customer feedback.
Prioritizing these areas can help transit agencies secure sustainable funding and deliver the reliable and accessible transportation their communities desperately need. But they will need both speed and accuracy to pull it off. Enter: Strategic Portfolio Management.
Read on to find out how this innovative framework can help pull transit authorities back from the fiscal cliff.
Strategic Portfolio Management (SPM) is a comprehensive methodology that aligns projects, programs, and investments with strategic objectives. It helps optimize resource allocation, minimize risks, and maximize return on investment across the portfolio—a combination that enables transit authorities to make data-driven, strategic decisions more efficiently.
Beyond this enhanced decision-making, there are five key benefits for transit authorities that adopt SPM:
1. Strategic Alignment and Prioritization: SPM works to ensure investments support long-term financial sustainability and community needs by aligning projects with strategic goals. It also uses a prioritization framework based on available resources, ROI (depending on an organization’s maturity), risk assessment, and community impact. This approach builds public trust and support for funding initiatives by clearly illustrating the benefits to the community.
2. Resource Optimization: Strategic Portfolio Management creates a holistic view of all projects and initiatives across an organization, supporting targeted allocation of funding, talent, and other assets. This approach ensures limited resources are effectively utilized to maintain service quality and reliability and meet urgent community transportation needs, even during financial instability.
3. Comprehensive Portfolio Visibility: According to a GetApp Lab report, 95 percent of organizations use two or more team tools, underscoring the need for a unified view across diverse teams and methodologies. Strategic Portfolio Management establishes a centralized project repository, consolidating all transit engagement data. This clarity allows decision-makers to quickly reallocate resources to critical initiatives, minimizing service disruption and maintaining public trust.
4. Enhanced Transparency and Risk Management: SPM can connect enterprises in a way that promotes transparency in project goals, risks, and outcomes across stakeholders. In transit agencies, this proactively minimizes delays and cost overruns, promotes greater accountability, and helps keep initiatives on track and aligned with organizational objectives.
5. Understanding of Dependencies and Risks: Strategic Portfolio Management enhances an organization’s ability to analyze relationships and dependencies between projects and anticipate challenges and conflicts. This reduces disruptions, maintains service reliability, and ultimately improves the passenger experience.
Insights in Action: A large state transportation enterprise engaged North Highland to mature its IT Department’s Portfolio Planning & Governance. Using SPM techniques, our experts transformed a siloed team of developers, managers, and directors into a cohesive group. This collaborative shift delivered visibility into the full array of ongoing projects, enabling better resource planning and a higher probability of projects finishing on schedule.
Erik Raper, Senior Managing Director of Strategic Portfolio Management at North Highland, shares how our proprietary SPM tool, NH360, helps transit authorities optimize resources, minimize risks, and align investments with strategic objectives.
We sat down with Erik to hear about his experience implementing NH360. Here’s what we learned:
The path forward is clear: transit authorities can't simply cut their way to sustainability. SPM offers a proven framework to transform how agencies allocate resources, measure impact, and demonstrate value to stakeholders. For transit leaders ready to move beyond crisis management, SPM provides the strategic foundation needed to build resilient, community-focused transportation systems that thrive—not just survive—in an uncertain funding landscape.
North Highland is committed to partnering with transit agencies to not only implement SPM, but to use it as a springboard for transformative change—turning strategic vision into a living, breathing reality that serves communities effectively and sustainably. To learn more about how North Highland brings the optimal combination of expertise, tooling, and methods to make your strategy real, visit our website.
North Highland was recognized as a Challenger in the 2025 Gartner® Magic Quadrant™ for Strategic Portfolio Management Report.
Gartner, Magic Quadrant for Strategic Portfolio Management, John Spaeth, Shailesh Muvera, et al., 4 August 2025
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