California Lawmakers' Plan Would Help Bay Area Transit Avoid Fiscal Disaster — for Now

Updated 4:56 p.m.

State lawmakers have come up with a plan that offers temporary relief to Bay Area transit agencies on the verge of a fiscal crisis that could force drastic service cuts as early as next summer.

State Sens. Scott Wiener, D-San Francisco, and Jesse Arreguín, D-Berkeley, announced Monday that the budget blueprint drawn up by Assembly and Senate budget negotiators would reverse a $1.1 billion cut in transit funding that Gov. Newsom proposed last month.

The Legislature’s budget, which must be approved by next Sunday, would also provide as much as $750 million in interest-free loans to Bay Area transit operators who are staring down devastating budget deficits in the fiscal year beginning July 1, 2026.

Arreguín and Wiener issued a joint statement that warned “allowing [public transit] to collapse would devastate California’s economic recovery and quality of life.”

But the senators, who have worked for the last several months with Assemblymember Mark Gonzalez, D-Los Angeles, to craft a transit relief package, acknowledged the Legislature’s plan will provide only a temporary respite from transit agencies’ long-term budget problems. Those challenges arise mostly from the pandemic-driven loss of ridership and fare revenue and a downturn in tax receipts that bus and train operators rely on.

“Our public transportation systems’ future is still far from secure, and they require greater engagement and prioritization from our leaders to avert disaster,” Arreguín and Wiener said. “Even with this one-time relief package, systems across the state continue to face large budget shortfalls that threaten devastating service cuts.”

The lawmakers’ solution to the transit crisis, which rejects the governor’s proposal to redirect $1.5 billion of revenue in the state’s cap-and-trade fund to Cal Fire instead of transit, will need Newsom’s approval to take effect. The governor’s office says it’s still reviewing the proposal.

Parisa Safarzadeh, director of communications for the San Francisco Municipal Transportation Agency, said in an email statement that city officials will work with community members “to make sure this package is part of the final budget with the governor. We are working to make Muni more efficient and accountable, but our city’s economy cannot withstand the severe Muni service cuts that would result without this state support.”

A recent analysis for the Metropolitan Transportation Commission found that collectively, BART, Muni, AC Transit, Caltrain and Golden Gate Transit face a total deficit of $3.7 billion in the five fiscal years beginning in July 2026.

BART and San Francisco’s Muni system account for $2.9 billion of that total, with both facing staggering shortfalls — $380 million for BART, $320 million for Muni — in fiscal 2026–27.

If those deficits are not solved, BART said that it might have to suspend service on two of its five lines, reduce service on those runs to just one or two trains every 60 minutes, shorten daily service hours and shut down some stations as a result. Muni leaders have warned that the agency might need to suspend service on 20 bus lines, cut the frequency of service by 50% and end service at 9 p.m.

To avert those cuts, Wiener, Arreguín and Assemblymember Catherine Stefani, D-San Francisco, are working with the MTC and officials across the Bay Area to craft legislation to authorize a November 2026 ballot measure that would aid BART, Muni, AC Transit, Caltrain and other operators.

The bill, SB 63, recently passed the Senate and will be taken up next by the Assembly Transportation Committee. It would impose additional sales taxes in San Francisco, Alameda and Contra Costa counties to support day-to-day operations and to improve regional transit connections. The MTC has estimated that the sales taxes — a half-cent in Alameda and Contra counties and up to one cent in San Francisco — would raise up to $550 million a year.

The bill also allows San Mateo and Santa Clara counties to opt in to the ballot measure, a decision each county would have to make by Aug. 11.