MTC Adopts Proposals to Fund Major Transit Improvements, Reduce Greenhouse Gases

Two new funding programs to bolster the Bay Area’s transit network and address climate concerns were adopted by MTC on December 18th. Initially proposed in November, the approved programs include changes to reflect input by elected officials and members of the public.

Totaling nearly $10 billion, the programs are a direct response to the recently adopted Plan Bay Area, which seeks to reduce the region’s transportation-related emissions by 18 percent before 2040.

“Plan Bay Area challenges the region to find funding needed to keep our heavily used public transit network in good repair and reduce greenhouse gases from transportation. The Commission’s action represents true progress toward achieving both of these objectives,” noted MTC’s Programming and Allocations Director Alix Bockelman.

The first program creates a Cap and Trade Funding Framework to guide investment priorities for some $3.2 billion in state Cap and Trade revenues that the Bay Area anticipates receiving over the next few decades. Plan Bay Area provides that at least 25 percent of these funds must be invested in low-income communities. The proposal also calls for a comprehensive public review process for developing the Project Selection Guidelines and assumes a timeline of roughly six to 12 months before staff would bring the guidelines to the Commission for approval. Adoption of guidelines will precede any selection of specific projects to benefit from the funds, with the exception of the new Transit Core Capacity Challenge Grant Program (explained below). The Commission also specified which operators would benefit from the $500 million set aside for the Transit Operating and Efficiency category.

In all, the Cap and Trade Funding Framework includes:

  1. $1.05 billion for One Bay Area Grants, which support transit-oriented development and other local transportation improvements
  2. $500 million for a Transit Operating and Efficiency Program
  3. $450 million to improve goods movement and mitigate associated environmental impacts
  4. $275 million for MTC’s Climate Initiatives Program, with $75 million going directly to Safe Routes to School
  5. $875 million for the Core Capacity Challenge Grant program

The Core Capacity Challenge Grant program commits $7.5 billion — including $875 million from the above-referenced Cap and Trade funds, $402 million in bridge toll revenues, and over $3 billion in federal transportation funds — over 15 years for capital improvements to the region’s largest transit systems: San Francisco Muni, BART and AC Transit. Over 80 percent of the region’s transit riders, and 75 percent of low-income and minority riders, are accommodated by these three systems. The program would fund transit vehicle replacement, fleet expansion and key facility upgrades. To receive the money, operators would need to meet certain performance and efficiency objectives, and match 30 percent of the grant money with their own funds. A key element of the local matching funds for Muni would come from future revenue sources identified by the San Francisco Mayor's Transportation Task Force. Some $75 million of the funding is earmarked for future rail cars needed for the BART extension to Silicon Valley, the first phase of which is under construction by the Santa Clara Valley Transportation Authority.

Meeting materials with further background can be found here.

Resolutions adopted by MTC on December 18, 2013:

December Commission Meeting Items: