Bay Area transit advocates and state lawmakers are celebrating a budget agreement with Gov. Gavin Newsom that includes a $750 million loan to Bay Area transit agencies to hold them over until November 2026, when voters could decide on a sales tax measure to fund transit operations.
The agreement also restores $1.1 billion from the greenhouse gas reduction funds that previously had gone to pay for transit infrastructure projects.
“I’m extremely proud that this budget protects these critical agencies from collapsing at a time we need them more than ever to power our continued economic recovery,” state Senator Scott Wiener said in a statement on Tuesday. “This funding avoids a disaster for our state, but transit agencies will need a long-term source of funding to secure a thriving future.”
The long-term solution for funding transit will come from Senate Bill 63. If approved by the state legislature and signed by Governor Newsom, the bill will authorize a sales tax ballot measure next year in the Bay Area in at least three counties, San Francisco, Alameda and, Contra Costa. Wiener and Assemblyman Jesse Arreguín are the authors of SB 63.
Bay Area transit agencies are facing massive budget deficits at the start of the 2026–27 fiscal year, including the San Francisco Municipal Transportation Agency (SFMTA). The SFMTA is projected to face a $322 million budget shortfall next year that could lead to cuts to Muni service.
The agency has already had to cut Muni service this summer to shrink a $50 million budget shortfall this year. Those cuts went into effect last weekend.
Transit advocates are celebrating now, but are looking forward to supporting longer-term solutions in keeping public transit moving in the Bay Area.
“This budget deal is a step toward saving our transit system and moving toward a future where people and communities thrive, said Adina Levin, executive director for Seamless Bay Area.