California transit operators are poised to receive a temporary infusion of $400 million in cash from the state for operating funds, a move that could defray immediate shortfalls and set up a steady stream of state money for the foreseeable future.
Governor Arnold Schwarzenegger ratified last night the laws (ABX8 6 and ABX8 9) that eliminate the gas tax, which included stipulations on transit funding, and replace it with an excise tax. Despite the removal of the transit funding mechanisms in the gas tax, these bills ensure that transit operators have steady funding for operations by using the sales tax on diesel to replenish the State Transit Assistance Fund (STA).
The governor had declined to sign the transit operation funding bills that transit advocates and lawmakers crafted to match his own budget proposal. San Francisco Mayor Gavin Newsom last week decried the news that the governor hadn’t signed the bills as a "back-breaker" for Muni and said that by signing the bills, Schwarzenegger would have been a "transit hero, at least for the week, until there are other cuts the next week."
"We see this as making great progress toward establishing stable and reliable transit operating funding," said California Transit Association (CTA) Spokesperson Jeff Wagner. "While it eliminates sources of funding that transit should have been getting, it will create a source of funding that will provide transit with far more than it has been getting, on average."
According to the CTA, the laws signed by Schwarzenegger will establish a baseline of $350 million each year for transit operations starting in 2012, with allocations projected to reach $400 million in 2016-17 and $500 million in 2020-21. Compare that with the average annual STA allocation of $258.5 million over the last five years and $189.9 million over the last ten years and operators could see light at the end of a long tunnel of state transit raids.
In San Francisco, the MTA would receive $36 million both this fiscal year and next — not enough to fix the projected deficit of $50 million next year, but certainly a welcome shot in the arm. MTA staff and the agency’s Board are still evaluating the impact of the windfall on the current budget year, including whether to use the funds to partially or fully stave off planned 10 percent service cuts.
"While Monday’s action by the Governor does not restore all of the revenue we have lost from the state in recent years, the funding will clearly help us provide more reliable transit service to our customers," said MTA Executive Director Nat Ford. "We thank the State Legislature and in particular State Senator Leland Yee, State Senator Mark Leno, Assemblywoman Fiona Ma and Assemblyman Tom Ammiano for their support."
Not everyone sees the move as beneficial and some transit advocates are concerned that the state can continue to raid the new transit funds from the sales tax on diesel just as it had done with the gas tax.
"I’m concerned that we’re losing the few legal protections that offered hope that we would actually start seeing some of that money," TransForm’s Carli Paine told Streetsblog recently, referring to the voter-mandated transit funding streams that were attached to the gas tax. "All we have left is the governor’s and legislators’ word that some money will go to transit, but they haven’t been good on their word."