Green Mountain Transit warns of $3 million shortfall; state to shift some rural routes to other providers

Green Mountain Transit officials told the House Human Services Committee that the agency faces a projected $3 million operating shortfall next year and that the Vermont Agency of Transportation (VTrans) is planning to transfer parts of GMT’s rural service to other providers, a change GMT staff warned could take effect July 1, 2026.

The agency’s representative, Clayton Clark, said GMT — which operates both urban and rural transit under separate funding streams — has already cut about $1 million in annual operating costs but still faces a large gap driven primarily by labor and the end of temporary COVID-era relief. "Our biggest cost driver . . . is labor," Clark said. He told committee members GMT is negotiating a new three‑year contract with its largest union and that that negotiation outcome is a major budget uncertainty.

Why it matters: GMT operates the state’s largest share of rides and mixes urban fixed‑route service with rural on‑demand programs funded from distinct sources. Clark told the committee the separation of urban and rural funding prevents GMT from using surplus rural revenue to smooth urban shortfalls, and VTrans is proposing to move some rural operations to other regional nonprofit providers to reduce duplicated overhead.

Most important facts: Clark said GMT provides about 2.3 million rides in its service area and handles slightly more than half of the state’s public transit trips overall. Of that total, roughly 52,000 rides are ADA paratransit trips. GMT’s reported average cost per urban ride is about $6.15; small‑town fixed routes average about $16.17 per ride; commuter/link routes can reach $30 or more per ride. Clark told the committee the agency has a worst‑case plan that would cut services down to core routes, curtail weekend and later‑day service, and eliminate some link/commuter runs if the full gap is not closed.

On the proposed transfer of rural service: Clark described a state review that would move GMT’s rural operations to other providers such as Tri‑Valley Transit, RCT (Rural Community Transportation), and CIDER (Champlain Islanders Developing Essential Resources). He said the transfer is being driven by state decisions, not GMT’s preference, and that the change is intended to reduce administrative overhead and to let specialized rural providers run county programs more cheaply. Clark said GMT currently transfers only about $300,000 per year from rural to urban programs and that VTrans estimates the statewide transfer plan could save up to $1 million annually; VTrans would then provide some of those savings back to GMT to cover the lost interprogram transfer funding.

Services, eligibility and programs: GMT runs fixed urban routes in Chittenden County (including Burlington), link routes to St. Albans and Montpelier, seasonal services for resort areas (for example, Sugarbush and Stowe), and rural on‑demand (O&D) and Medicaid nonemergency medical transportation (NEMT). Clark explained that NEMT provides door‑to‑door trips for Medicaid recipients and that GMT handles eligibility checks and trip verification for that program. He told the committee NEMT does not have a strict mileage cap and that, in practice, some Medicaid trips travel long distances for specialized care.

Funding and federal grants: Clark said GMT receives a mix of direct Federal Transit Administration (FTA) urban formula funds (a little over $4 million directly) and other rural and state funds routed through VTrans. He said capital purchases (buses, facilities) are usually 80–90% federally funded and that operating funds are typically about two‑thirds federal for urban service. Clark also warned that some competitive federal grants that paid for battery‑electric buses had been uncertain earlier in the year but were allowed to proceed after FTA review.

Local impacts and governance: Clark told the committee GMT is a municipality created under its enabling statute (originating in the 1970s) and therefore has assessment authority in its urban area; rural member towns are not subject to the same automatic assessments. He said GMT has a large board of commissioners and that municipalities can join or leave the GMT service area under statutory rules. Clark and committee members discussed how service changes are communicated to riders, the role of local partnerships (towns, chambers, resorts) in funding seasonal routes, and the practical effects for riders if calls and logos shift to other providers after a transfer.

What the committee asked and next steps: Committee members pressed GMT on the potential rider impact of transfers, data used to judge route performance, and whether other providers could operate routes at lower cost. Clark said VTrans coordinated outreach when specific routes (for example, the Jeffersonville commuter) were proposed for elimination and that the agency uses public meetings and alternatives promotion (carpools, vanpools) before cutting service. He also said GMT is forming an affiliated nonprofit to pursue grant funding for services that are not economically efficient but have important social value. No formal legislative action or vote was recorded during the presentation; committee members said they might call GMT back when drafting related bills.

Ending: GMT officials asked committee members to consider that route performance reports and cost‑per‑ride metrics are economic measures that do not always capture human‑service needs — for example, routes serving methadone clinics or senior centers may underperform economically but meet critical needs. Clark requested that the Legislature and VTrans weigh those non‑economic factors as they consider funding decisions and possible transfers of rural service.