New federal funds may limit Bay Area transit agency cuts
The Bay Area’s transit agencies, hit hard by fare losses during the pandemic, expect to receive around $ 975 million in federal funds from the latest coronavirus relief bill, officials said Tuesday.
The news of a $ 900 billion federal stimulus bill passed Monday filled Bay Area transit operators with relief and might avert layoffs for now, but longterm financial instability remains. Congress approved $ 14 billion for transit agencies nationwide in the bill, which still needs to be signed into
law by the president. Nearly $ 1 billion will be allocated to Bay Area agencies, including BART and the San Francisco Municipal Transportation Agency, which runs Muni, although the exact amount for each agency is still being determined.
“In the near term, it really relieves a great deal of pressure,” said Brian Sobel, board director with the Golden Gate Bridge, Highway and Transportation District, which voted last month to lay off 146 workers come January as the district faced a budget shortfall. The board will vote again Wednesday on whether to rescind those layoffs when the president signs the new bill.
“It’s a wonderful holiday present for everyone,” he said.
Federal relief comes at a critical time. Bay Area transit agencies have decreased service as ridership remains at an alltime low. With the first round of stimulus funding — $ 1.3 billion to Bay Area transit from earlier this year — starting to run out, some were already planning to cut jobs.
The Metropolitan Transportation Commission, the Bay Area’s transit coordinating agency, will divide the new funds among about two dozen agencies. It’s a complicated process that will take time, although the agency is trying to get out money as soon as possible. The MTC will take into account multiple factors, including how many riders an agency has, how much revenue operators have lost and who they serve, to ensure equity.
“It’s complex and it’s going to be hard and we’re going to work with transit operators to try to come to a consensus,” said Randy Rentschler, legislative and public affairs director with the MTC. “We’re going to come back to different, we’re not going to come back to the same. This is not going to be easy and the stakes are high.”
For some agencies and workers facing imminent cuts, the funds are expected to provide immediate relief. The Golden Gate Bridge, Highway and Transportation District planned to lay off 146 employees, eliminate 59 vacant jobs and implement a temporary 10% pay cut for management come Jan. 4 . The district’s $ 51.6 million in Cares Act funding already ran dry in November. With the promise of more funding this week, the district called an emergency meeting for Wednesday to vote to reverse course.
If the board decides to halt layoffs, the agency will face a
$ 48 million shortfall this fiscal year. It’s not clear yet how much of the gap the new funds will fill. A staff memo to the board that recommended rescinding layoffs ended with a caveat that if bridge toll revenue doesn’t rebound or more federal relief doesn’t arrive, further cuts to save money or bridge toll hikes to raise revenue may still be needed.
District General Manager Denis Mulligan said Tuesday he was “ecstatic” about the new funding and hoped it would get the district through the spring. But ridership and revenue depend on factors beyond his control such as economic recovery and vaccine adoption, he said.
“Now there’s light at the end of the tunnel, we don’t know how long that tunnel is,” Mulligan said. “There will be a lot of uncertainty along the way, but this helps us navigate that uncertainty in these very difficult times.”
Workers who already got layoff notices received word Tuesday that their jobs could be spared and reacted with a mix of relief and skepticism.
“It’s definitely progress,” bus driver Lisa Reed said. “My hopes are high, but my expectations are low in regards to the people in charge.”
Reed said she would continue working at Golden Gate Transit because her family needed the money, but wasn’t sure now that she wanted to stay longterm and has been looking at jobs out of state.
“Seeing the way we were treated and disregarded, I’m not sure if there’s a future with them,” she said.
Bus driver Chris Garland wanted to stay, but worried with the outlook for the pandemic and transit so uncertain.
“It’s great news that it looks like they’re on their way to rescinding layoffs, but my main concern is how it’s going to be going forward,” Garland said. “That’s what I’m afraid of.”
Mulligan told The Chronicle the district “is a wonderful place to work” — but it had been devastated financially by the pandemic.
“I hope that folks realize that something like this happens only once every hundred years,” he said. “We look forward to welcoming our customers back with the same firstclass service we’ve always provided, and to do that we need our employees.”
Other transit agency officials expressed gratitude for critical shortterm relief, but pointed out it only made a dent in solving longterm budget shortfalls. On Monday, the SFMTA said in a statement that it’s grateful for the funds, but still faces a financial crisis and will continue tapping into rainy day reserves to balance the budget.
“A longterm sustainable funding source will be necessary to even maintain current service levels, consider restoration of critical service and provide the system that San Franciscans expect,” the agency said in an email to The Chronicle.
The SFMTA received $ 373.7 million in Cares Act funding, but still faces at least a $ 68 million shortfall this fiscal year and $ 168 million next fiscal year. The agency said it may have to lay off up to 22% of its workers next fiscal year. Nearly 40 Muni bus lines cut at the beginning of the pandemic could be lost permanently unless the city finds a new revenue source.
Jeffrey Tumlin, head of the SFMTA, tweeted Monday that relief funding “doesn't allow us to recover, but does stabilize ( Muni) and forestall layoffs.”
BART used $ 377 million in Cares Act funding — the most awarded to any Bay Area transit agency — to plug its budget hole for most of this fiscal year, but still faces a $ 33 million deficit in the fourth quarter and $ 177 million next fiscal year. The agency already reduced service and has considered layoffs as a last resort depending on the outcome of a retirement incentive package.
Spokeswoman Alicia Trost said BART will work with MTC on a plan to allocate funds and use stimulus money to make up for lost fare revenue, support workers and keep trains running.
“We are grateful for the shortterm relief,” Trost said. “We will use the funds to help fill the immediate deficit while staff continues to work on the solution that will help with the expected longerterm deficit caused by the pandemic.”