Jun 13, 2023 - Transit

California budget proposal allocates $1.1B to state transit agencies

Photo of a BART train car with people sitting inside

Bay Area Rapid Transit riders at a San Francisco station stop in October 2020. Photo: David Paul Morris/Bloomberg via Getty Images

As the California Legislature approaches its Thursday deadline to pass a budget, a new plan could set aside $1.1 billion in funding for transit agencies facing financial catastrophe, such as BART and Muni.

Why it matters: The Legislature's newly released budget proposal rejects Gov. Gavin Newsom's proposal to cut $2 billion from transit infrastructure funding, and comes after transit agencies warned of severe service cuts without additional support — including the loss of BART weekend operations and 15 to 20 Muni bus lines.

  • BART and Muni, the region's two largest systems, are projected to reach their fiscal cliffs in 2025, meaning they could face budget deficits in the hundreds of millions of dollars.

Context: Newsom's proposed cuts, part of an effort to offset a nearly $32 billion budget deficit, led to protests and calls for state lawmakers to keep transit agencies running while ridership rebounds.

  • "Supporting transit operations in this budget determines whether our downtowns thrive or die, whether our economy is strangled or supported ... and whether some of those San Franciscans who are struggling most can go about their daily lives," Mayor London Breed wrote in a May letter to the Assembly Budget Committee.

Driving the news: The new budget agreement released by the state Senate and Assembly includes additional funding for public transportation operations and restores cuts to transit capital projects.

  • It would allocate $1.1 billion in largely cap-and-trade funds, which are typically used on projects that reduce greenhouse gas emissions, to transit operations.
  • "We must exhaust every option to preserve our public transportation systems — for our climate, for our economic recovery, and for the millions who rely on it each day," state Sen. Scott Weiner (D-SF) said in a statement.

What they're saying: Daniel Lopez, a spokesperson for Newsom, said the governor is working with lawmakers and "remains optimistic that a deal can be reached to provide support for transit statewide."

The big picture: BART has especially struggled to recover from COVID-related revenue losses — prior to the pandemic, more than 70% of its operating budget was covered by fares. As ridership decreased, that fell to around 21%.

  • Meanwhile, Muni's ridership — though steadily increasing — also hovers around half of what it was pre-pandemic.
  • Both agencies have said service cuts could start as early as this fall if the state does not step in.
  • SFMTA would have to start eliminating one Muni line per month for 20 months, the San Francisco Chronicle reports.

What's next: Once the Legislature passes the budget, it will head to Newsom's desk.

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