MTC approves emergency Transit Operations Regional Funding Framework from Senate Bill 125

The Metropolitan Transportation Commission (MTC) today adopted the framework for the $300 million regional contribution to complement Senate Bill (SB) 125 emergency transit operations funding for transit operations to address Bay Area transit agencies’ most dire funding shortfalls and help them avoid service cuts. 

In December 2023, the Commission approved MTC’s Short-Term Financial Plan for submittal to the California State Transportation Agency in accordance with the requirements of SB 125. The plan outlined an emergency transit operations funding strategy that will use state and regional funds for transit operations to address Bay Area transit agencies’ most dire funding shortfalls and help them avoid service cuts, and identified that a regional contribution of $300 million was necessary to address the standardized shortfall needs of transit agencies through Fiscal Year (FY) 2025-26. Today’s action makes available $300 million in regional funds to supplement SB 125 state funds.

Regional Contribution for Transit Operating Assistance

MTC staff identified $300 million in currently unassigned funds that can be made available as a one-time contribution to transit operations expenses. Regional revenues include those from the Surface Transportation Program/Congestion Mitigation and Air Quality Improvement Program (STP/CMAQ); Federal Transit Administration Section 5307/5337 (Transit Capital Program); State Transit Assistance Population-Based Program (STA Regional Program); and Regional Measure 3 Operating Program funds for express bus service, including annual funds and escrowed funds.

Today’s adopted regional funding framework outlines the process for matching regional revenues to transit agencies based on factors such as fund source eligibility requirements, agencies’ ability to make use of funds in a timely manner, and fair distribution of state and regional funds. Table 1 shows how MTC will distribute funds according to the framework.

Distribution amounts will be reassessed annually to respond to changing conditions, and the disbursement of operating funds will be contingent upon transit agencies meeting or making significant progress toward a set of accountability requirements, including customer experience and efficiency enhancements. 

Regional Accountability Measures

For all agencies receiving emergency operating money, the accountability requirements will include participation in ongoing Transit Transformation Action Plan initiatives, and implementation of schedule coordination and real-time transit data improvements. Other accountability requirements are specific to individual operators and focus on safety and security, fare evasion reduction, and comprehensive service improvements.

Staff at today’s meeting also presented a report on transit agencies’ interim progress toward fulfilling the SB 125 Regional Accountability Measures. Summarized in greater detail in Attachment A, large transit agencies receiving SB 125 funds have generally fulfilled or made satisfactory progress toward the SB 125 Regional Accountability Measures. Notably, participation in regional initiatives remains strong among large agencies, with all agencies fulfilling the MTC-identified requirements. 

With the Commission’s approval of this regional funding framework, staff next month will return to the Programming and Allocations Committee to make these funds available to the transit agencies by early FY2025-26.