A bill that would authorize a Bay Area regional sales tax measure on the November 2026 ballot passed in the state Senate and is now heading to the Assembly.
Senate Bill 63, authored by state Senators Scott Wiener (San Francisco) and Jesse Arreguín (Berkeley), would help fund transit operations for many of the troubled Bay Area transit systems that will face a financial crisis when the 2026–27 fiscal year starts on July 1, 2026. The San Francisco Municipal Transportation Agency (SFMTA), for example, projects a $322 million budget deficit, which could lead to future Muni service cuts.
The SFMTA Board of Directors has already approved to cut some Muni service this summer to help close out a $50 million deficit the agency projected for the start of July 1 this year. The agency had cut some services already in February.
“SB 63 is a critical part of stabilizing our transit systems & strengthening them for our region’s future,” Wiener posted on his Bluesky account Tuesday.
The bill would authorize a half-cent sales tax in San Francisco, Alameda, and Contra Costa counties. San Francisco can opt for a higher sales tax of one cent. San Mateo and Santa Clara can opt in with a deadline of Aug. 11.
The next step for the bill is for it to be reviewed by committees in the Assembly, which will happen in the summer and the fall. The bill must pass the state legislature by Sept. 12 and a Oct. 12 deadline for the governor to sign the bill.
SFMTA staff presented the news to the board on Tuesday on the bill passing the Senate, but also received not-so-good news about Governor Newsom’s revised budget.
The outlook in the governor’s proposed budget is not good for the SFMTA, as the agency’s chief of staff, Judson True, said $245 million is at risk that the agency planned to use for Muni, including upgrading the subway’s outdated train control system. Another $17 million is also at risk that the agency uses to help pay for its fare discount programs, including its free Muni program for youth.
Director of Transportation Julie Kirschbaum told the board they could potentially find another way to fill the $17 million gap, but given the agency’s current budget situation, the options were not good.
“It becomes a direct trade-off with service cuts,” Kirschbaum said.
Newsom’s budget proposal sees cuts to funding for transit in the state’s Cap-and-Invest program, which is the state’s program to reduce greenhouse gas emissions. It allows the state’s major polluters to purchase credits to allow emissions above the state cap. Funding from the program has gone to fund transit projects and transit operations.
What was also noticeably absent from the budget proposal was a request for $2 billion to fund transit over the next two years. The ask was made by Arreguín and Assemblyman Mark González of Los Angeles.
For the SFMTA, the funding would be “bridge funding” so the agency can get through the next year or so ahead of potential ballot measures next year. Kirschbaum had previously said that the agency would not see any revenue generated from ballot measures until spring 2027.
The California State Legislature has a June 15 deadline to pass a budget. True said trailer bills following the budget approval do not follow the same timeline, adding that the Cap-and-Invest program is in that category and that negotiations for funding will be ongoing throughout the summer.
