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BART Faces Toughest Financial Outlook in 50-Year History

The Bay Area regional transit system is desperately trying to recover from the plummeting ridership numbers caused by the coronavirus pandemic. Officials expect the system’s budget deficit will be $1.2 billion by 2032.

(TNS) — BART has withstood earthquakes and survived economic recessions in its near 50-year history. But California's Bay Area's regional rail system is staring down one of its most daunting challenges yet: It's approaching a financial cliff as its leading source of revenue — fares — is sluggishly recovering.

New projections shared at a BART Board of Directors meeting Thursday underscore the challenge that the region's public transit agencies continue to face as telework and low office occupancy have contributed to one of nation's slowest transit recoveries.

The agency expects to exhaust the pandemic federal aid that's helped sustain BART operations by fiscal 2024, when it will start incurring a budget deficit of $48 million, according to a "base case" projection. Under this scenario, the deficit is projected to balloon to $1.2 billion by fiscal 2032, absent new sources of revenue.

Fare revenues, which accounted for about 65 percent of the agency's budget before the pandemic, are not a likely source of relief. Revised projections by BART expect the agency to recover 70 percent of its average pre-COVID weekday ridership in the next 10 years.

"It is clear that we are facing our most challenging revenue outlook throughout our system's 50-year period," said Pam Herhold, BART's assistant general manager for performance and budget. "We need to work together to extend our fiscal runway beyond the projected 24- to 32-month timeline. We cannot cut our way to a balanced budget and remain a meaningful public transit service for the Bay Area."

Signs point to a potential ballot measure in 2024 that would either be BART-specific or a regional mega measure, such as the $100 billion tax proposal for transit that was briefly discussed among transit officials in 2020.

BART leaders say they've committed to reinventing the system to address the longstanding pre-COVID concerns from riders about cleanliness and personal safety on the system by hiring more cleaning staff, transit ambassadors and crisis intervention specialists meant to give riders a greater sense of security on BART.

BART's ridership recovery, though, has been slow compared to other U.S. transit agencies, and the region's recent omicron surge undid months of progress.

Some BART board directors said that for a tax measure to be successful, the agency would have to convince voters it would lead to meaningful quality-of-life changes for riders, and not be used as merely a financial stopgap to sustain current service.

"When people are going to the ballot, they want to see that we've changed, that we've actually reinvented ourselves," BART Board Director Liz Ames said. "We have new fare gates, we've got cleaner stations than ever before. And, of course, the filtration, we launched that early on (during the pandemic). But it's not really resonating with folks."

It's unclear whether the region's transit agencies, which are all facing similar financial cliffs, will coalesce behind a regional mega ballot measure, or go it alone.

San Francisco officials have floated a potential tax measure this year to sustain and possibly expand service operations for Muni, the Bay Area's largest transit system, to aid its pandemic recovery and attract more riders. A concrete plan has yet to emerge.

The Municipal Transportation Agency, which runs Muni, had until recently projected incurring a budget deficit starting next fiscal year. Officials say the new projections that push back SFMTA's estimated fiscal cliff to 2025 gives the agency more time and flexibility to decide what course it plans to chart at the ballot box.

Recent polling, though, illustrates the tough sell public transportation faces in winning the necessary support from voters for a tax measure for operations.

Polling commissioned by the Metropolitan Transportation Commission, the region's transportation planning agency, in August found that Bay Area voters are less likely to support a new tax for transit than they were in 2019 in part because of rising sentiments that taxes in the region are already high enough.

The poll of 800 respondents found that voters view other issues, such as homelessness, education, climate change and public safety, as more important to prioritize funding than for public transportation.

BART officials said Thursday they planned to begin a lengthy public outreach campaign that will likely include listening sessions to gather input from riders and voters.

(c)2022 the San Francisco Chronicle. Distributed by Tribune Content Agency, LLC.
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