Wall, NJ — Student Transportation of America Ltd. (STA), one of North America’s fastest growing school transportation providers, today reported that it is has seen an increase in the number of school districts interested in “converting” from public to private school bus fleets.  The North America school transportation market is a $15 billion industry and approximately two-thirds of school districts currently own and operate their own fleets.

“Budget constraints are forcing local municipalities, school districts and state officials to decide between cutting programs, laying off teachers or purchasing new school vehicles and funding in- house transportation departments,” said Denis J Gallagher, STA Chairman and CEO. “We’re pleased to see the more these government operations learn about contracted transportation services, and the true cost of their own operations, in time and money, the more they see the economic and operating advantages that we can bring to their already depleted municipal budgets. We have proven we can implement improvements and efficiencies in operations and provide the necessary capital for fleet purchases that are important issues facing today’s financially strapped municipalities and school districts.”



“These difficult economic times represent significant growth opportunities for our business. In the current recessionary environment, we are experiencing an increase in the availability of labor, fuel prices are down substantially, and interest rates in our debt facility are at very low rates to use for our growth plan. We have grown at a rate of over 20 percent in each of the last eight years and have recently submitted several new bid and conversion proposals for local school administrators to consider,” Gallagher said.

Recently school districts in over twelve US states reportedly are going down the privatization road or investigating the conversion of their school transportation systems. Gallagher said STA has completed several successful conversions in recent years that have the full support of the existing drivers, mechanics, and administration and have built an excellent relationship with the community.

“This is no time to cut teacher salaries and educational or extra-curricular programs. Instead, taxpayers should challenge state and local governments to concentrate on what business they are in; hopefully that’s education. When we provide the capital, operate their system more efficiently, and employ their existing drivers while saving taxpayers money, I guess that answers why there is an increase in activity,” Gallagher said.

About Student Transportation

Founded in 1997, Student Transportation is the fourth-largest provider of school bus transportation services in North America, conducting operations through local operating subsidiaries. Student Transportation 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 5,600 school vehicles in North America. For more information, please visit www.rideSTA.com

Forward-Looking Statements

This news release contains “forward-looking statements” within the meaning of applicable securities laws, which reflects the expectations of management regarding STA’s results of operations, expense levels, cost of capital, financial leverage, seasonality, cash flows, performance, liquidity, borrowing availability, financial ratios, ability to execute the STA’s growth strategy and cash distributions. Forward-looking statements generally can be identified by the use of forward-looking terminology such as “may”, “will”, “expect”, “intend”, “track”, “targeted”, “estimate”, “anticipate”, “believe”, “should”, “plans” or “continue” or similar expressions suggesting future outcomes or events. These forward looking statements reflect STA’s current expectations regarding anticipated future events, results, circumstances, performance or expectations, which are not historical facts. Forward looking statements involve significant risks and uncertainties, and should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not or the times at which or by the performance or results will be achieved. A number of factors could cause our actual results to differ materially from the results discussed, expressed, or implied in any forward-looking statement made by us or on our behalf, including, but not limited to the factors discussed under “Risk Factors” in our Annual Information Form. These forward looking statements are made as of the date of this news release and, except as required by applicable law, we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

INVESTOR CONTACTS:

Student Transportation of America Ltd.

Denis J. Gallagher

Chairman and Chief Executive Officer

Patrick J. Walker

Executive Vice President and Chief Financial Officer

Keith P. Engelbert

Director of Investor Relations

(732) 280-4200

Email: [email protected]

Website: www.rideSTA.com

MEDIA CONTACT:

Lynette Viviani

973-968-7929 office

973-534-1004 mobile

[email protected]