"Under legislation unveiled Feb. 13 and slammed through the Legislature mostly along party lines in just six days, the state would loan $590 million to BART, AC Transit, Caltrain and San Francisco MUNI. The Legislature passed the bill on Thursday morning, just hours before Newsom, flanked by gushing Bay Area transit officials, signed it at BART's Daly City maintenance yard."
"They're essentially mortgaging our capital projects to make payroll, said state Sen. Dave Cortese, D-San Jose, on Wednesday, the night before the Legislature approved the bill. It's just not sustainable. He's right. The notion of BART, AC Transit, Caltrain and MUNI taking on long-term debt to pay for current operating expenses is fiscally irresponsible. And the sin is compounded because the scheme would divert, and potentially put at risk, money for a key capital project."
"The loans would not require new state money. Rather the money would come from an existing pot of state funds earmarked for Bay Area transit capital projects. The transit agencies would have 12 years to repay it. The biggest share of the capital money tapped for the loans had been allocated to help a fifth transit agency, the South Bay's Valley Transportation Authority, build its planned San Jose BART extension."
Governor Gavin Newsom signed legislation that loans $590 million to BART, AC Transit, Caltrain and San Francisco MUNI to cover operating costs until new sales tax revenue begins. The Legislature approved the bill within six days, using existing state capital funds rather than new appropriations. The loans would be repaid over 12 years. The largest portion of the tapped capital funds had been earmarked for the Valley Transportation Authority's planned San Jose BART extension. Critics warn that diverting capital dollars to cover operations mortgages future projects, risks federal funding for the San Jose extension, and reflects failure to right-size post-pandemic operations.
Read at www.mercurynews.com
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