MTA Board Discusses Revenue Options to Cover $1 Billion Five-Year Shortfall

Facing a projected net deficit of over $1 billion by 2015, the MTA Board of Directors held a workshop today to consider potential new sources of revenue for the agency. MTA Chief Financial Officer Sonali Bose presented a variety of options (slideshow PDF), ranging from cruise ship fees to parking congestion impact fees, many of which have been discussed at previous MTA meetings.

The question, as board member Shirley Breyer Black put it, is: "Are they practical?"

IMG_3770.jpgExecutive Director Nat Ford and Directors Cameron Beach and Jerry Lee review revenue proposals. Photo: Michael Rhodes

In some cases, the answer seems to be a qualified yes. In spite of the city attorney’s determination that the MTA lacks authority to impose fee on cars rented at San Francisco International Airport, Chairman Tom Nolan and board member Malcolm Heinicke were optimistic that such a fee could be implemented. Heinicke noted that such a fee exists in other cities, while Nolan said he would be "happy to work with Heinicke and San Mateo County" to further look into such an option.

Another proposal the board indicated support for is a crackdown on disabled parking placard abuse. Citing the results of sting operations, Bose recommended seeking state legislative approval to begin charging for the placards, implement time limits, and limit the number of placards issued, while also creating more disabled parking zones. Board member Bruce Oka, an advocate for disabled transit riders, strongly supported the measure. "I don’t know who told the state to issue us these for nothing," said Oka, noting that the placards haven’t always been free.

Acting on the recommendation of Citizen Advisory Council (CAC) Chairman Daniel Murphy, the board also showed strong support for putting a bond measure on the citywide ballot, most likely in November 2010. The board didn’t settle on a specific revenue source to pay for the bond, but Nolan was confident that if a bond measure was presented to the public convincingly, it might get the two-thirds approval required to pass. "The cost needs to be divided as equitably as possible among all the people of San Francisco, businesses, residents, and visitors," said Nolan. If voters perceived the measure as fair, Nolan said, "we’d have a chance" of getting the necessary two-thirds vote.

Heinicke suggested that in order to make the bond measure more appealing to voters, it should focus on capital. "I see a lot of obstacles," said Heinicke. "Maybe we should pursue a bond dedicated to capital … Capital allows us to explain the use of the money to the people very clearly."

Several options, including a cruise ship fee and a hotel room tax, appealed less to the board, given the difficulty of selling measures perceived as negative for tourism. It’s not clear which form of tax a bond measure would include, however, so most options are still on the table.

One suggestion from the CAC’s Murphy wasn’t discussed by the board: a curb cut mitigation fee that would apply not only to new curb cuts, but to the 200,000 existing ones in San Francisco as well. "The existing ones are a pretty significant impingement on the availability of parking and a pretty significant use of a public resource, which is essentially the space on the street, which the property owner doesn’t own," said Murphy. The CAC also brought this idea before the MTA Revenue Panel in January 2008.

With momentum gaining on the board for a bond measure, and with the MTA set to continue discussing potential revenue sources at their next meeting on August 4, the size and repayment source for the bond will be hot topics. Generally, the board seemed to support the idea that if they go to the ballot, they might as well go big. It’s very important to "go for a significant sum," said Murphy. "Swing for the fences."

  • marcos

    What capital projects did they have in mind for that bond?

    Its kinda important to figure out what you want to do before you figure out how you’re going to fund it.

    There has to be a way to charge downtown businesses for the benefits they derive from expensive, intensive rush hour service. The City Attorney has nixed this. Maybe a ballot measure campaign for a fee based on proximity to transit and transit demand metrics, requiring the very low signature thresholds required due to the uncontested mayor’s race, could force the City Attorney to defend this.

    What’s on the table is crap.

    -marc

  • What goes on the bond will depend on what the public is will to rally behind. I am a member of the SFMTA CAC myself and share Dan Murphy’s sentiment, let’s become the city that knows how again.

  • Sasha

    Bond measures are a tough sell to begin with. But a campaign for a new bond measure for the MTA can’t avoid the fact that we just approved a bond measure a few years ago, and Newsom promptly reappropriated all the money for other city departments. Unless there’s both a) a way to craft a bond measure to provide certainty that the MTA will get to keep all the money, and b) a way to simply and clearly illustrate to voters how this one will be different, I don’t see how another MTA bond measure is going to fly.

  • marcos

    @Jamison Wieser, the City that knows how to WHAT?

    Gavin Newsom gives us enough vacuous boosterism, thanks.

    Muni’s structural fiscal crisis is operational more so than capital.

    Certain capital investments might increase efficiencies to some extent. Others add operational burden. You all are not considering buying stuff that we can’t afford to run, are you?

    The General Obligation bond well is very shallow compared to the cost of transit capital project(s).

    The TEP was mysteriously silent on any capital program. Are they about to spring something new on us by surprise?

    For megabond comparison sake, SFGH had been working on its rebuild since the state legislation passed after the 89 quake raising hospital seismic safety standards and setting deadlines. DPH then came to the voters with a massive bond which had gone through an exhaustive public vetting process and did the work required to pass it.

    I doubt that the Streets Bond will pass either because its just an unplanned can being kicked down the road.

    -marc

  • marcos

    @Sasha, Prop A wasn’t a bond, but an omnibus Charter Amendment which changed the allocation of parking revenues, dedicating $26m to Muni which Newsom promptly siphoned off from Muni to his cronies through work orders.

    Nothing more than mickey mouse hour over at the MTA as far as revenue goes.

    -marc

  • I’d like to know why pedestrian projects seem to get the least funding attention (what’d I see in the linked slideshow, 3% funded for countdown pedestrian signals or something weak like that?!?) … everybody is a pedestrian. Why do we not scream and shout about the lack of funding and negligence exhibited towards pedestrian safety in downtown San Francisco? Blowing a wad on a Central Subway that should be looking into a BRT system, and giving pedestrians the shaft. That’s pitiful.

  • rzu

    I agree with marc that what is on the table is crap. This is just a rehash of what the so-called Blue Ribbon panel came up with two years ago. It was crap then, and is crap now. And a bond measure? Is it a good idea to be funding ongoing and predictable transit expenses with a bond? I think not.