Third-party review confirms top transit agencies’ operating deficits

A third-party analysis released last week at MTC’s May Commission meeting forecasts a combined $3.7 billion operating shortfall for five major Bay Area transit agencies in the 2026 to 2030 fiscal years. 

Beginning in FY 2027 when state and federal relief funding runs out, this translates to an average annual deficit of approximately $914.8 million across the five operators: BART, San Francisco Municipal Transportation Agency (SFMTA), AC Transit, Caltrain and Golden Gate Transit.  For FY 2027, the report validated the following deficits:

• AC Transit: $73 million
• BART: $378 million
• Caltrain: $65 million
• SFMTA: $322 million

In response to a request by regional leaders and other stakeholders, MTC engaged Macias Gini & O’Connell LLP (MGO), to conduct an independent third-party review of transit agency revenues, expenses, and cost saving measures as well as current local contributions to BART and Caltrain. The analysis is critical for understanding the agencies’ projected operating deficits for the purpose of facilitating conversations around averting major service cuts, fair-share contributions to Caltrain and BART, and the sizing of a proposed regional tax measure to address the transit agencies’ short- and medium-term deficits while they seek complementary and longer-term solutions. 

The report also summarized operator reserves and revenue-generating and cost saving measures operators have taken since the COVID 19 pandemic, including fare increases, adjustments to service levels, hiring freezes and elimination of positions and strategies to reduce electricity costs.  

The full report can be found here.

Last week’s Commission meeting also featured an update on Senate Bill 63, authored by Senators Scott Wiener of San Francisco and Jesse Arreguin of Berkeley, which would authorize placement of a regional tax measure on the November 2026 ballot. The bill passed on the Senate Floor on June 2. SB 63's current provisions:

• Applies to Alameda, Contra Costa and San Francisco counties, with option for San Mateo and Santa Clara counties to join.
• A 10- to 15-year duration
• Half-cent sales tax, but variable rates are under consideration.
• 10% of the funds generated by the measure each year would be directed to advancing the Bay Area Transit Transformation Action Plan to grow ridership.
• Portion to avert major service cuts on BART, Caltrain, AC Transit, and Muni, plus funding for feeder buses in participating counties.
• Remainder (if any) to be used for local transit priorities to be determined by county transportation agencies.