"The loan money would help the four transit agencies cover the cost of operations until they can begin collecting revenue from a new Bay Area sales tax measure planned for the November ballot. 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. Which helps explain why one, but only one, Bay Area legislator did not vote for the deal. "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."
A $590 million state loan will be provided to BART, AC Transit, Caltrain and San Francisco MUNI to cover operating costs until revenue from a proposed Bay Area sales tax is collected. The funds will come from existing state capital dollars earmarked for Bay Area transit projects and must be repaid over 12 years. The largest portion came from funds originally allocated to the Valley Transportation Authority for the planned San Jose BART extension. One legislator, Sen. Dave Cortese, opposed the measure, calling it mortgaging capital projects to make payroll. The loan risks derailing capital projects and jeopardizing federal funding and long-term fiscal sustainability.
Read at The Mercury News
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