California transit agencies ask for $5 billion in state funding to avoid 'fiscal cliff'
SACRAMENTO -- Transit officials from across California have called on the state to allocate some $5 billion over the next five years to help transit agencies stave off drastic cuts and massive pandemic-induced deficits.
As transit officials have signaled in recent months that agencies could face existential financial conditions as soon as 2024, the California Transit Association asked state legislators on Tuesday to provide a total of $5.15 billion to public transit agencies over the next five fiscal years.
The proposal would provide $1.2 billion in transit agencies in just the coming 2023-2024 fiscal year and would help beleaguered operators like BART, the San Francisco Municipal Transportation Agency and the Los Angeles County Metropolitan Transportation Authority to avoid deep service cuts and develop a long-term funding plan.
According to the CTA, the estimated funding shortfall for transit operators across the state totals roughly $6 billion combined.
"We can't jeopardize our industry's reinvention and investment in the future by letting agencies run out of lifeblood operations funding today," CTA Executive Director Michael Pimentel said Wednesday. "Now more than ever, we are urging states to ensure we are there for those who depend on public transit."
At the state capitol on Wednesday, Pimentel joined representatives from BART, Muni and the LA Metro; state Sen. Scott Wiener, D-San Francisco; and representatives from transit and business advocacy groups like the Bay Area Council to call on state officials to approve the funding request.
Wiener formed a select committee within the state Senate earlier this year focused on how to assist Bay Area public transit agencies as their ridership continues struggling to rebound to pre-pandemic levels.
State legislators are also dealing with their own budget deficit of some $22.5 billion after the state's capital gains tax revenue fell by $29.5 billion year-over-year.
CTA officials noted that the funding in their proposal would not come solely from the state's general fund. Instead, several billion would come from increased allocations of diesel fuel sales tax revenue and unallocated cap and trade revenue as well as the conversion of some capital funding - which is used for infrastructure projects - into operations funding.
Wiener argued that allowing transit systems to fail financially would result in cascading economic consequences and hamper the state's efforts to reduce vehicle traffic and greenhouse gas emissions.
"In the next 12-to-24 months, ... the federal emergency funds run out and we have a mismatch," Wiener said. "Ridership hasn't recovered as quickly as we would need to make up for the loss of those federal funds, and that's why the state needs to step in."
BART officials estimate that the transit agency is on track to run out of federal funding by March 2025 with its current spending and revenue levels. The agency would then face operating deficits of more than $300 million per year.
A lack of in-person workers across the Bay Area, and downtown San Francisco in particular, has left BART's ridership stuck around 40 percent of its pre-pandemic expectations on weekdays and between 60 and 70 percent of pre-pandemic expectations on weekends.
BART saw its highest ridership of any day since the pandemic began on April 20, but those 179,013 riders only accounted for 44 percent of pre-pandemic ridership, according to the transit agency.
"Before the pandemic, fares provided more than 70 percent of the funding for BART service, more than any transit agency in the world," BART Board member Bevan Dufty said. "What was once a source of pride has become our Achilles' heel."
Wiener acknowledged that transit agencies may need to change how they operate in the coming years as work and social patterns change, but stressed that those changes can't happen if they go bankrupt or have to drastically cut service.
"This is about triage and stabilizing a very dangerous situation so that over the next few years, we can actually have those conversations from a position of financial stability," Wiener said.
