SAN FRANCISCO (KRON) — California Gov. Gavin Newsom announced on Wednesday that the state would offer short-term financial assistance to beleaguered Bay Area transit agencies. The governor pledged to provide the agencies with an infusion of hundreds of millions of dollars.
The state’s Department of Finance and the California State Transportation Agency will work with the transit agencies and regional partners to design “short-term financing tools,” according to Newsom’s office. Potential tools offered could include structured loans or other mechanisms that align with operational needs, protect existing services and support fiscal reforms “with clear and reliable payments,” Newsom’s office said.
“Transit is a lifeline to millions of Californians — and after billions in state investment, we’re continuing to back Bay Area agencies with ongoing support tailored to their needs,” Gov. Newsom said. “We’ll keep partnering with them now and into next year — aligning flexible financing tools to their timelines — so we can deliver a sustainable, rider-first transit system together.”
The Newsom administration, according to the governor’s office, “will continue to evaluate these options to ensure assistance remains responsive to agencies’ stated needs and strengthens the long-term financial stability of Bay Area transit.”
Newsom’s financial assurances come at a critical time for Bay Area transit agencies. Earlier this year, Bay Area Rapid Transit officials said the agency was facing a “fiscal cliff” and could run out of emergency funds next year.
This week, Newsom and other state officials have been weighing extending a $750 million loan to local transit agencies. The loan was part of a state budget packaged signed by Newsom in June. A deadline to approve the $750 million loan was due to expire this week.
However, it has now been extended until January. The San Francisco Chronicle is reporting that without the $750 million loan, BART service could be cut by as much as 90%, while SF Muni could see a 30% service cut.
It is not yet clear what impact the short-term assistance floated by Newsom on Wednesday will have on the $750 million previously approved by state lawmakers.
KRON4 News reached out to San Francisco Mayor Daniel Lurie’s office and received the following statement:
“San Francisco’s recovery and California’s economy depend on strong and reliable Bay Area transit systems. We are doing our part in San Francisco to get our house in order, and with better management and more accountability, we’re seeing more people choosing to take Muni. Thank you to Governor Newsom for his commitment to Bay Area transit, as well as our partners in the state legislature and community leaders. We look forward to continuing to work together to deliver safe and reliable transit systems that will drive San Francisco’s comeback.”
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