San Francisco explores ballot measures to address $150 million funding gap for Caltrain

As part of Mayor Lee’s initiative to find funding for the City of San Francisco’s transportation needs, the City and County of San Francisco commissioned a study on how to keep commitments to Caltrain. The study quantified San Francisco’s obligations, and proposed new mechanisms to meet the obligations.   By winter/spring 2014, San Francisco expects to introduce legislation to initiate ballot measures for funding sources that require voter approval

In addition to the funding steps, the study also included potentially powerful recommendations to improve Caltrain going forward.

The report acknowledges that Caltrain plays a key role in the city’s transportation system, moving nearly 20,500 riders to San Francisco San Francisco and 14,000 riders in the reverse direction, reducing congestion, greenhouse gas emissions, and supporting the economy.

San Francisco’s Caltrain deficit

The study acknowledges that San Francisco faces a $146 million shortfall over the next 10 years.  This gap includes:

• $40.1 million shortfall for Electrification project (total for 10 years, uninflated)
• $41.7 million shortfall for State-of-Good Repair projects (total for 10 years, uninflated)
• $64.0 million or more shortfall for operating subsidy (total for 10 years, uninflated)

The Caltrain gap is a small part of San Francisco’s overall need to fill budget shortfalls.  Muni estimates a State of Good Repair backlog of over $2.2 billion.

The study identified four sources of funding, which would together close the funding gap:

* a commuter transportation tax, such as that used in the New York City metropolitan area on private employers with payroll above $1.2 M per year.  The study proposes a 0.025 percent tax rate (which would be in addition to the range of 3.0 to 5.0 percent existing business tax.

* a parcel tax ($20 per parcel)

* an auto sales tax of .5% of gross tax receipts

* a regional sports/entertainment surcharge of $1 per ticket

A summary of the revenue garnered from these approaches is below:

Potential San Francisco Caltrain funding options

Potential San Francisco Caltrain funding options

 

The study also included several potentially powerful recommendations for improvement.

Better partner budget coordination. Caltrain’s requirements for capital funding fluctuate from year to year, and are reported after San Francisco has completed its budget.     This issues not infrequently results in difficulty for Caltrain to assemble the needed revenue for maintenance, putting service reliability at risk.  Also, Caltrain’s operating funding depends on yearly contributions from 3 partners – a budget challenge in any of the agencies triggers a financial crises for the system as a whole. San Francisco recommends forming a Caltrain Joint Powers Board subcommittee or working group to explore solutions, including creating a two-year budget and 10-year capital plan, to improve stability and reduce surprises.

Operating funding aligned to regional transportation goals.   The Bay Area, and the state, have ambitious goals to combat climate change, but the transit funding mechanisms are not aligned, and not enough, to achieve those goals.  The report includes an intriguing suggestion that could potentially be modified to align Caltrain funding with overall goals – tying Caltrain operating funding to mode share.   The specific suggestion in the report doesn’t make much sense and would not work politically. The report suggests adjusting the contributions for each county by mode share. This approach would benefit San Francisco, because it has the most density and transit use already, and would penalize Santa Clara County because it has vast sprawling areas many miles away from Caltrain stations.   While the proposal as stated wouldn’t work, it would be much more attractive, and maybe practical, to set mode share goals for the “catchment area” within 1-3 miles of Caltrain.  Employers with good transportation programs (Stanford, Google) already have less than 50% of their employees driving. If similar approaches to reduce driving mode share can be used across multiple employers and residences within a reachable radius of Caltrain, these areas could get bonuses to afford increased service, station area improvements, and other investments to continue mode share progress.

The good news is that San Francisco is looking ahead and planning to keep its commitments.  Could some of these approaches be extended to San Mateo and Santa Clara Counties to improve the stability of Caltrain funding?