(BCN) – Gov. Gavin Newsom on Monday signed legislation that will put the decision to impose a regional sales tax to help fill the budget shortfall of major Bay Area public transit agencies in the hands of voters.
Senate Bill 63, also known as the Connect Bay Area Act, adds a regional measure to the 2026 ballot to Alameda, Contra Costa, San Mateo, Santa Clara and San Francisco counties. It would allow voters to decide on a 14-year sales tax that would be distributed directly to transit agencies — half a cent in Alameda, Contra Costa, San Mateo and Santa Clara counties, and one cent in San Francisco.
Revenues will be disbursed directly to some of the larger transit operators, while other funds will be made available to smaller county transit authorities who, in turn, will be able to provide funding for smaller transit agencies and transit-related projects.
BART, the Alameda/Contra Costa Transit District, Muni, Caltrain, San Francisco Bay Ferry and Golden Gate Transit will be the main beneficiaries of the sales tax.
The Metropolitan Transportation Commission, a region-wide planning body for transit, has estimated that agencies could face a combined budget shortfall of $900 million at the start of fiscal year 2027. The sales tax, according to independent analysts hired by MTC, could generate enough revenue to help close the funding gap and keep agencies operating.
State Sens. Scott Wiener, D-San Francisco, and Jesse Arreguin, D-Berkeley, played a large role in crafting Senate Bill 63 and pushing for its passage.
“The Bay Area operates through transportation, and this measure will allow it to continue operating for many years to come,” Weiner said in a statement. “We still have a long way to go to secure the future of our trains and buses, but with the enactment of SB 63 and Mayor (San Francisco) Mooney’s funding measures, we have a clear path to stabilizing the system.”
Transportation executives from the East Bay to the Peninsula echoed their support for the passage of Senate Bill 63, hoping it will win approval from voters and keep the Bay Area moving.
BART General Manager Bob Powers was one of them.
“The BART Board of Directors supported SB 63 because it will cover a significant portion of BART’s operational deficit caused by telework and will allow us to maintain current service levels and improve the rider experience,” he said in a statement released by the agency on Monday.
Julie Kirschbaum, transportation director for the San Francisco Municipal Transportation Agency, called the signing of the legislation “historic” and praised Weiner and Arreguin for their work on the bill.
The SFMTA faces a $307 million budget shortfall starting in July 2026, despite recovering ridership, the agency said.
“Everyone who moves around the Bay Area needs transit in order to survive and thrive,” Kirschbaum said in a statement issued by her office. “And those who rarely or never use transit still rely on it to relieve congestion and help our environment.”
Besides funding operations at transit agencies, the proposed sales tax would also help fund Clipper START — a transit pass program to qualify low-income individuals — and accessibility projects for seniors and people with disabilities.
An additional oversight committee will be formed to ensure that funds are allocated appropriately.
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