CA Transit Operators Win in Court, But Face Challenge by Governor

A state appellate court in Sacramento ruled two days ago that Governor Arnold Schwarzenegger can't continue taking money out of the Public Transportation Account (PTA) to help balance the budget, something the governor has done repeatedly while in office, costing state transit operators $1.19 billion in 2007-2008 alone. Many Bay Area transit operators might not have had to cut service, raise fares, nor stage epic battles with their unions if that steady source of funding had been allocated to them.

The lead plaintiff in the case, the California Transit Association (CTA), which consists of transit operators throughout the state, was understandably thrilled with the decision.

“The ruling clearly states that the rip-offs are illegal,” said CTA Executive Director Joshua Shaw. “It says they’ve been illegal since before 2007, and it says that the definition of mass transportation that lawmakers have adopted since then to mask these diversions is illegal.”

The CTA said the decision is a 100 percent vindication of their case and if it stands, transit operators can expect to receive all of the funding from the PTA. A CTA spokesperson said a lower court ruling in 2008 had only been a partial victory that required the state to pay back about 35 percent of the funding it had taken from the PTA.

According to California Department of Finance Deputy Director H.D. Palmer, the governor plans to appeal to the State Supreme Court. "We continue to believe that the transfers that have been done in the past and will be done in the future are legal under the way the rules of the PTA are drafted," he said. When asked if he thought the Supreme Court would hear the case he replied, "absolutely."

What this means for local operators is that they will see no funding from the state in the next fiscal year and perhaps none until 2011, depending on the outcome of the case at the Supreme Court level.

MTA spokesperson Judson True applauded the ruling: "It reinforces what we've been saying for a long time -- the state should be funding transit aside from just bond measures." True said the MTA would have received $152 million over the past three years from the state if it weren't for the diversions. "We have tremendous unmet capital needs and operating challenges."

BART spokesperson Linton Johnson said his agency would have received $30 million last year without the diversions, though the MTC would have taken some off the top to reapportion to other transit operators in the region. "I don't expect that we'll see a dime anytime soon as a result of the ruling, and thus our transit funding will be held up yet again as the courts sort it all out."

AC Transit, which last year would have received $26 million before diversions, received $3 million. "In absolute money terms, the CTA ruling means nothing immediately but we view it as a  positive step," said spokesperson Clarence Johnson, who added that the state has diverted more than $100 million since 2000.

Christine Dunn, who speaks for SamTrans and Caltrain, was equally pessimistic that the ruling would net operating money any time soon. "The good news is that the decision affirms the public’s desire to fund transit. However, it would be unwise in these economic times to count on receiving additional funds from the state.  We will proceed with the budgets that have been approved by our board, but we would welcome the opportunity to adjust the budget to reflect additional revenue."