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Setting the Record Straight on Transportation Funding in the California Budget

Market St. at Sutter, San Francisco, public transportation wagons, May 1906, from the Bancroft Library, University of California, Berkeley.

From the Office of the Speaker of the California State Assembly

There have been recent stories in the press shining light on the fact that the budget that passed the Legislature relies on nearly $1.3 billion from public transit funds to help balance the General Fund budget and build the reserve.

No Democrats are happy about this and it does not reflect the values of California Democrats that believe public transit plays and integral role in the lives of working Californians and will play a key role as the state reduces greenhouse gas emissions.

But, the public transit budget is actually better than what has been reported and much better than what the Governor and the Republican Legislators wanted. This, despite the disproportionate power of rightwing Republican Legislators that would rather round up every bus and commuter train in the state to sell on E-bay to finance tax cuts for rich people to purchase more gas-guzzling SUVs.

On the three key areas of public transit that were under threat by the Governor and Republican Legislators – local operations, STIP transit projects, and Proposition 1B transit – the budget passed by the Legislature was significantly better than what the Governor proposed and what the Republicans wanted.

Local Transit Operations

The Governor proposed funding local operations from state funds at around $200 million and to permanently eliminate "spillover" funds for local transit operations.

The budget that passed the Legislature doubles the proposed amount to $416 million. More importantly, the budget preserves "spillover" funds for local transit operations on a permanent basis ensuring that state support continues to grow year after year.

The following chart illustrates the historic state support for local transit operations and compares what the Governor proposed to what passed the Legislature for the next three years. Democrats should get credit for nearly doubling state support for local transit operation on an on-going basis.

STIP Transit Capital

The Governor's proposed budget provided NO NEW FUNDING from the Public Transportation Account (PTA) to support the transit capital projects approved by the Transportation Commission.

This would have resulted in the deprogramming of transit capital projects in the STIP and would have set back these improvements several years. In addition, due to the required regional balance of the STIP, this would have disrupted STIP highway projects as well.

The budget passed by the Legislature, however, provides approximately $540 million from the PTA to essentially fully fund the transit capital projects in the STIP. As a result, the STIP can go forward as planned by the Transportation Commission for both transit and highway capital projects.

Proposition 1B Transit Funding

The voters passed Proposition 1B with the expectation that the $4 billion for public transit projects would go for additional projects. The Governor, however, proposed that the Proposition 1B funds for public transit be used to backfill the loss of STIP funding (as described above). Under this scheme, the bond funds would not be used as planned for new projects, but instead would be used to finance the Governor's proposal to shift existing transit funds to the General Fund.

The budget that passed the Legislature rejected this proposal to undermine the voters and instead appropriates $600 million of Proposition 1B funds for new transit projects.

In conclusion, no Democrats are happy with the level of transit cuts in this year's budget. More than anything else, as we stand at this critical point in our fight against global warming, the cuts result in a missed opportunity to expand and improve public transit.

Given what the Governor and Republican Legislators wanted in the budget and the disproportionate power that the rightwing has over the budget, the Democrats success in doubling support for local operations, preserving STIP funding, and appropriating Proposition 1B funds for new projects is a major victory for public transit.

Posted on August 25, 2007

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