[4] The company changed ownership several times until 1889 when it was bought by a group of Boston and Chicago investors[6] who planned to extend services and convert the system to electricity.

[4] Initially, this covered only roads not already occupied by other track, but he later convinced the city council to also allow him to operate on Congress Avenue and Pecan Street.

Shipe had started a streetcar suburb venture two and a half miles north of the city called Hyde Park,[8] the destination for the first line.

[14] The Austin Rapid Transit Railway had operated at a loss from 1892 and was in receivership from 1897 until it shut down in 1902 selling its assets at auction to its president, F. H.

[17] In the early 1910s the company faced stiff competition from jitney drivers who would follow streetcar lines offering cheaper service but those disappeared when they were unable to meet a city bond requirement.

In June 1970 the city had granted a franchise to Transportation Enterprises Inc. (TEI) to run a shuttle bus service at the University of Texas.

[28] CapMetro was established by a referendum on January 19, 1985, to provide mass transportation service to the greater Austin metropolitan area.

Voters in Austin and the surrounding area approved the creation of the agency, to be funded in part by a 1 percent sales tax.

[29] In an effort to boost ridership, CapMetro did away with fares completely and instituted fare-free in an experiment that lasted from October 1989 to December 1990.

in an attempt to make the transit authority both more effective and transparent ahead of a performance review by the Texas Comptroller of Public Accounts.,[31] the Legislature subsequently overhauled CapMetro and its board of directors.As part of this restructuring, the Legislature ordered CapMetro to hold an up-or-down referendum on passenger rail.

In response, CapMetro released an ambitious plan that proposed to spend $1.9 billion for a light rail system with 52 miles of track on existing streets.

The referendum was narrowly defeated in November 2000 by 2,000 votes, with voters in central Austin tending to favor it, while those outside the city limits did not.

[32] The Comptroller's review cited an "ongoing criminal investigation" by the FBI, "irresponsible management", "expensive, embarrassing mistakes", "dubious contracting and purchasing practices", and $118,000 spent on "food, parties, and presents for its employees" and culminated with, "We have never, in all of the performance reviews we have conducted, seen an agency with such a lack of accountability.

While the project was somewhat marred by construction delays, questions and safety and cost overruns, the Red Line of the CapMetro Rail began service on March 22, 2010.

[36] A 2019 survey conducted by Eastside Memorial's student council showed that 70 percent of that student body needed the prior local bus service restored [37] CapMetro had its first passenger/bus fatality in its operating history on January 30, 2012, when route 383 operated by Veolia Transportation bus struck a pedestrian crossing Braker Lane and Jollyville Road.

[38] The next fatality happened on January 29, 2019, when a driver struck Anthony John Diaz while he was cycling near the University of Texas campus.

At the beginning of the COVID-19 pandemic in spring 2023, CapMetro scaled back weekday operations to their standard Sunday schedule.

In 2023, Capmetro also began a 7.537 million contract with Keolis to oversee fixed-route bus operations and maintenance for MetroRapid and MetroBus services.

[40] A new logo and rebranding campaign received mixed public feedback [41][42] CapMetro began bus service to Round Rock in summer 2017.

In June 1995, the Board of Directors reinstated the sales and use tax to the full one percent effective October 1, 1995, promising to set aside the additional revenue for funding light rail.

Political leaders and organizations, including former Republican state Rep. Terry Keel of Austin, Travis County Commissioner Gerald Daugherty and his anti-rail group Reclaim Our Allocated Dollars (ROAD), wanted the sales-tax money to build projects such as a highway loop around Austin and an east–west freeway.

[47] To head that off and keep rail's future prospects alive, the CapMetro board passed resolutions in the months after the vote making two promises: It would direct $91 million of its existing reserves to local governments for transportation projects, and it would dispense all proceeds that year from a quarter-cent of its tax to those same local governments.

In January 2014, CapMetro launched a bus rapid transit service branded MetroRapid, utilizing articulated buses operating in shared lanes with automobile traffic.

[63] In November 2020, Austin voters approved CapMetro's Project Connect transit development proposal which includes a significant expansion of rail services.

[68] By mid 2023, the light rail portion had been scaled back amid rising costs — the Downtown Tunnel was eliminated in lieu of a surface route which had been truncated in length.

[69] In addition to its core bus and rail operations, CapMetro operates several additional services: CapMetro operates routes using three different fare classes: Several groups are eligible for Reduced Fare IDs issued by CapMetro entitling them to a discount of half the listed price for fares: seniors 65 and over, Medicare card holders, persons with disabilities, students 6–18 with valid school identification, and active and reserve military with valid ID.

[76] As a public entity, CapMetro is prohibited by Texas law from entering into a traditional collective bargaining agreement with a labor union in the United States.

In January 1992, CapMetro created StarTran Inc., a private entity that acts as the authority's agent in managing its unionized workforce.

[83] During the strike, the agency initially provided only those routes on the contingency map for a reduced number of hours but added others as resources became available.