CA: Newsom approves $590 million loan for struggling transit agencies

Gov. Gavin Newsom on Thursday authorized a $590 million loan to bolster struggling transit agencies in the Bay Area, some of which could collapse without an economic life boat.

The funding is less than the $750 million that state Sen. Scott Wiener, D- San Francisco, and other lawmakers had tried to secure when they passed a budget in June. But officials believe it's enough money to provide stability as commuters return to offices, and advocates campaign for multiple tax measures in November. Laura Tolkoff, transportation policy director for SPUR, said the loan "buys about six more months of time," staving off service cuts that would otherwise have started this summer.

"This loan will avert a traffic catastrophe and save millions of Bay Area transit riders from losing their ride to work, family, and school," said Wiener, who helped negotiate for the loan alongside his colleague, state Sen. Jesse Arreguín, D-Berkelely. "After months at the bargaining table, 'I'm immensely proud that we got it over the finish line,' Wiener said. Arreguín called Thursday's development 'a major victory.'

A sales tax that will appear on ballots in five counties — Alameda, Contra Costa, San Francisco, Santa Clara and San Mateo — would fund agencies such as BART, Muni and Caltrain. In San Francisco, Mayor Daniel Lurie and others are promoting a parcel tax that would help shore up the city bus and subway system.

Transit operators across the Bay Area are confronting huge deficits, and warning of severe austerity measures if voters don't approve a bailout. BART, which faces a shortfall of up to $400 million a year, released plans earlier this month to close between 10 and 15 stations if the tax measure fails, unwinding 50 years of expansion for the sprawling agency. Muni, likewise, could suspend cable cars and stop regular bus service at 9 p.m. every day, while slashing up to 20 routes.

Despite what could be an impending disaster, Newsom struck an optimistic tone Thursday afternoon, as he stepped onto a BART train in the Daly City yard to sign legislation for the loan. It will enable the California State Transportation Agency pull funds from the Intercity Rail Capital Program, which furnishes long-term capital projects, and transfer them to the Bay Area's Metropolitan Transportation Commission, to meet what Newsom saw as a more pressing need. (The move poses little risk to the big projects, which typically take years to plan and build, policymakers say.) MTC would repay the loan in quarterly installments over 12 years, paying only interest for the first two years.

"This is not just about transportation, it's about economic development," the governor said, characterizing BART and other operators as key to "the value proposition of the bay." The homeland of tech would crater, Newsom and others warned, if freeways become perpetually jammed and millions of commuters are unable to get to their jobs.

BART Board President Melissa Hernandez and other leaders thanked the governor from a podium at the BART yard on Thursday afternoon. Assemblymember Lori Wilson, who chairs the Assembly's transportation committee, emphasized that public transportation is not a luxury but a necessity for many Californians.

Wiener highlighted the importance of transit not only for people who use it, but for drivers whose quality of life would suffer if another 100,000 cars pour onto freeways.

"The last thing we need," he said, "is to have these systems unravel."

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