Toronto, Ontario — August 22, 2005 – Student Transportation of America Ltd. (“STA Ltd.”)
and Student Transportation of America ULC (“STA ULC”, and together with STA Ltd., the
“Issuer”) (TSX: STB.UN) today announced that a cash payment of $0.08958333 per income
participating security (“IPS”) of the Issuer will be payable on September 15, 2005 to holders of
record of IPSs at the close of business on August 31, 2005.

Each IPS consists of one common share of STA Ltd. and CDN $3.847 principal amount of 14
per cent subordinated notes of STA ULC, a wholly-owned subsidiary of STA Ltd. The IPSs
trade on the Toronto Stock Exchange under the symbol STB.UN. The total payment of
$0.08958333 per IPS reflects a cash dividend of $0.04470166 per common share and an interest
payment of $0.04488167 per IPS for the period from August 1 to August 31, 2005, as provided
in the subordinated note indenture.

The Issuer is the fifth-largest provider of school bus transportation services in North America,
conducting operations through local operating subsidiaries. The Issuer has become a leading
school bus transportation company by aggregating operations through the consolidation of
existing providers and conversion of in-house operations and currently operates more than 3,000
school vehicles in North America. For more information, please visit www.sta-ips.com.

For more information contact:

Contact:
Denis J. Gallagher
Chairman & CEO
Phone: 732-280-4200
Email: [email protected]

Patrick J. Walker
Chief Financial Officer
Phone (732) 280-4200
Fax: (732) 280-4213