California approves $590M loan for BART, Muni, Caltrain, AC Transit

Newsom announces $590M for BART, Muni, Caltrain, AC Transit

Gov. Gavin Newsom announced a $590 million state loan to help stabilize BART, Muni, Caltrain and AC Transit as they face major budget deficits tied to post-pandemic ridership declines.

OAKLAND, Calif. - Several Bay Area public transit agencies are facing massive budget deficits fueled by a post-pandemic ridership slump. Now, California is stepping in with a $590 million loan to help stabilize services.

Gov. Gavin Newsom announced Thursday that under the newly signed AB-SB 117, the California State Transportation Agency can loan $590 million to the Metropolitan Transportation Commission. The funds are earmarked to help BART, Muni, Caltrain and AC Transit maintain reliable service as the region works toward a long-term funding solution — possibly through a regional sales tax measure expected to appear on the 2026 ballot.

"California is stepping up to support Bay Area transit—this agreement will help protect transit service for more than three million monthly riders," Newsom said. "The benefits of a strong transit system are clear: growing ridership, cleaner air, and less congested roads."

The Metropolitan Transportation Commission will disburse the funds to the four agencies.

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BART plans massive cutbacks in 2027 if voters reject sales tax

Bay Area residents got a look Thursday at the massive cuts that could be coming to BART next year, if voters don't approve a tax increase to bail out the transit agency. The proposal includes the closure of between 10 and 15 lower-ridership train stations, as well as major service cutbacks.

Long-term funding hinges on SB 63

Dig deeper:

If approved by voters, the Connect Bay Area Act, also known as SB 63, would provide new operating funding beginning in July 2027.

BART has been pinning its long-term recovery on a proposed 14-year sales tax measure projected to generate $980 million. Sixty percent of that would go toward BART, Caltrain, Muni and AC Transit.

The proposal calls for a half-cent sales tax in Alameda, Contra Costa, San Mateo and Santa Clara counties. San Francisco’s portion would be 1 cent.

Supporters say SB 63 would prevent major service cuts and layoffs across the region’s transit systems.

Potential cuts if measure fails

Local perspective:

In the meantime, the $590 million loan is expected to help the agencies stay afloat.

"Transit is essential for the Bay Area’s future, and we must protect it and do everything in our power to avert devastating service cuts," said state Sen. Scott Wiener. "This loan will avert a traffic catastrophe and save millions of Bay Area transit riders from losing their ride to work, family, and school."

BART has been transparent about its financial crisis and has warned that if SB 63 fails — and voters do not approve a tax measure in November — the agency would consider drastic cuts.

Proposed reductions include closing up to 15 stations, ending service at 9 p.m., reducing train frequency to every 30 minutes and laying off 1,200 workers.