California Gov. Gavin Newsom signed legislation authorizing the state to lend $590 million to keep major public-transit operators around San Francisco running as post-pandemic travel patterns continue to strain their finances.
The funds, which officials called an "emergency loan," are aimed at agencies including the San Francisco Bay Area Rapid Transit District that are still recovering from fare revenue lost to remote work and weaker ridership roughly six years after the Covid outbreak.
With one-time federal aid largely exhausted, several operators are staring at budget holes large enough to force deep service cuts — a scenario local officials say would push more commuters onto roads and undercut the region's economic rebound.
"This loan will avert a traffic catastrophe," state Sen. Scott Wiener, D-San Francisco, said in a statement issued along with Newsom and other officials.
Across the U.S., transit systems from New York and Chicago to Washington, D.C., and Seattle are confronting a post-pandemic "fiscal cliff" as ridership and fare revenue trail pre-2020 norms and federal relief dries up. As a result, agencies are scrambling for short-term fixes to avert punishing service cuts.
The California bill structures the assistance as short-term operating loans rather than a grant. The money — drawn from the state's Transit and Intercity Rail Capital Program — must be repaid quarterly over 12 years. For the first two years, agencies would pay interest only, with the rate tied to the state's Surplus Money Investment Fund. Repayment is ultimately backstopped by state transit-assistance revenue.
Supporters describe the loan as a bridge while officials pursue
