In light of statewide ridership, transit budget cut makes sense
From the moment Gov. Gavin Newsom announced in January that his next budget plan would include a $2 billion cut in funding for building mass transit, there was bleating from many of California's leading liberal legislators.
The budget reduction, warned state Sen. Scott Wiener, D-san Francisco, “could lead to significant service cuts, which is a downward death spiral for some (transit) agencies.”
State Sen. Nancy Skinner, Dberkeley, added that “I think everyone in the Legislature would not want to have any funding shift, for example, for a public service like transit.”
A look at the numbers, though, gives a pretty good idea why Newsom chose transit for about 10% of the cuts needed to make up a predicted $22 billion deficit. The numbers show that Californians are not as enthusiastic about either light or heavy rail commuting as their elected lawmakers.
Figures from the American Public Transit Association demonstrate that neither the extensive Bay Area Rapid Transit system nor Southern California's Metro Rail have come close to recovering the ridership they lost during the COVID-19 pandemic, when two things happened: Many office workers began working from home, and thousands of commuters chose to use private cars instead of public transit every day to avoid possible exposure to the many ever-mutating COVID variants.
By the fall of last year, BART was carrying just 55% of its prepandemic passenger load, while Metro Rail was at 71% of prior ridership. Partly, that's because San Francisco saw a greater shift than Southern California toward remote work. The change also saw San Francisco lose about 6% of its population, with many workers moving to less expensive areas once they no longer needed to live near their employers' offices.
The specific numbers, available most recently from last July, August and September, did show both systems carrying tens of thousands more people in those months of 2022 than a year before but still not nearly enough to make either system break even financially. That's one reason the Newsom budget proposal seeks to cut much more money for new lines and equipment than for operations.
However, any reduction in new rail construction offends folks like Wiener and Skinner for other reasons, even though they rarely mention it. Wiener, in particular, has been the legislative point person for the recent spate of state laws that encourage far denser housing than California has previously seen.
Proximity to mass transit lines and stations is written into some of those measures, with high-rise construction permitted almost automatically in areas close to “major transit corridors” and light rail stations. So the more new rail lines are built, the more dense housing will be permitted over the next few years.
The fact that not very much of the development authorized so far has actually taken place has less to do with transit access than with high interest rates and skepticism on the part of lenders. They see high vacancy rates where new construction has risen. Current vacancy rates in commercial and multifamily housing run about 27% in San Francisco and 20% in Los Angeles.
In short, just because legislators authorize something does not mean it will automatically occur, especially when the average cost of creating a new one-bedroom apartment or condominium reportedly is about $830,000. None of this will dampen the enthusiasm of Wiener, Skinner and other legislators for ever-denser housing, though.
As a result, and if transit ridership gradually creeps back toward prepandemic levels, expect pushback from the lawmakers over the cut in transit construction funding, putatively slashed by Newsom from $7.7 billion in 2022-23 to $5.7 billion in 2023-24. The fiscally conservative governor had to find places to cut his budget that would impact the fewest possible Californians.
Since ground has not even been broken yet on rail lines that were to be financed by the funds at issue, let alone pay for their operation, this is a cut that affects no one right now. That makes it a logical category to reduce unless there's a sudden and unexpected upturn in the state's finances.