NEWS

 

Sept. 13, 2025

Media Contact: Dan Lieberman, 650.622.2492

California Legislature Passes Legislation Authorizing Ballot Measure to Address Bay Area Transit Emergency

Senate Bill 63 (Wiener and Arreguin), If Passed by Voters, Would Generate Revenue to Support Bay Area Public Transit Systems and Close Caltrain’s Projected Operating Deficit

The California Legislature passed legislation today authorizing a ballot measure to create a 14-year, sub-regional sales tax in five Bay Area counties to generate revenue to support Bay Area public transportation systems. If signed into law by Gov. Gavin Newsom, the bill, Senate Bill (SB) 63, introduced by State Senators Scott Wiener and Jesse Arreguín, will allow voters to decide on the revenue measure on the November 2026 ballot.

If voters qualify a measure for the ballot under SB 63 and a majority approve it, the measure will provide critical operating funding for Caltrain, Muni, BART and AC Transit. It will also support rider improvements, smaller bus and ferry services, and dedicate funds to return-to-source projects identified by individual counties. The regional measure is intended to establish a stable funding source that addresses the fiscal shortfalls many Bay Area transit agencies continue to face after the pandemic.

The passage of the legislation comes as Bay Area transit agencies face looming fiscal cliffs that threaten service. Caltrain projects an average annual deficit of about $75 million beginning in fiscal year 2027. Without new funding, the agency would face difficult decisions, including drastic service reductions, station closures and cuts to service frequency. These challenges stem largely from shifting travel patterns that have changed how people commute, leaving Caltrain with structural budget shortfalls.

While Caltrain has made significant strides to regain ridership, reduce costs and increase non-fare revenue, there remains a structural need for ongoing funding sources. Caltrain would receive an average of about $75 million annually from the measure—a 7% allocation of the total funds generated—resulting in Caltrain’s operating deficit being fully funded and Caltrain maintaining its half-hourly service.
SB 63 would:     
                                    

• Authorize a sales tax in five counties in the Bay Area including the three counties that Caltrain operates in: San Francisco, San Mateo, and Santa Clara;
                                    
  
• Dedicate percentages of revenue in each of Caltrain’s counties to cover the railroad’s operations deficit, allowing for the preservation of Caltrain’s service level;
  
  
• Establish accountability measures and efficiency reviews to ensure that transit agencies are acting responsibly and appropriately with the funds they are receiving;
  
  
• Allow voters to decide the future of transit in the Bay Area, if the new district’s legislative body places a measure on the ballot, or if the voters circulate petitions to qualify a measure for the ballot.

“SB 63 is critical for Caltrain and other Bay Area transit systems. We are grateful to the bill authors Senators Weiner and Arreguin as well as the Caltrain delegation for strengthening and passing this critical legislation,” said Caltrain Executive Director Michelle Bouchard. “Thanks to electrification, we’re seeing our ridership grow faster than ever before because of the faster, more frequent, and more reliable service. Without SB63, we risk having to make service cuts that would put those gains at risk and push more cars back onto already congested roads. SB63 offers a light at the end of the tunnel to keep riders moving, reduce traffic, and build the sustainable transit system our region needs.”

“In May, the Peninsula Corridor Joint Powers Board of Directors (Caltrain) voted to support SB 63 because of its vital ability to provide funding to support our transit operations,” said Caltrain Board Chair Steve Heminger. “Next year, voters will have the choice to establish sustainable funding mechanisms that will ensure Caltrain and other Bay Area transit systems are able to keep running reliably and safely while supporting our local and surrounding communities.”

The measure follows the launch of Caltrain’s new high-performance electric trains in September 2024 offering a better experience for Caltrain riders and providing faster and more frequent service that has generated strong support for the agency. Caltrain reported its best ridership numbers since the 2020 and has seen 11 straight months of ridership growth. Caltrain saw ridership grow to 9.1 million passengers over FY2025, up from 6.2 million in FY2024, with over 75% ridership growth from July 2024 to July 2025.

A January poll of Santa Clara, San Mateo, and San Francisco counties highlighted voters’ overwhelming approval for Caltrain, with 82% of respondents reporting a favorable view of the transit agency. Those who are riders of Caltrain reported even stronger approval of the agency, with 91% of frequent riders reporting a favorable view.

Nearly two-thirds of respondents to the poll in San Francisco and San Mateo counties also reported they would support a Caltrain funding measure, with support at 65% and 63%, respectively. A majority of voters polled in Santa Clara County also supported a Caltrain measure.

###

About Caltrain: Owned and operated by the Peninsula Corridor Joint Powers Board, Caltrain provides rail service from San Francisco to San Jose, with commute service to Gilroy. Serving the region since 1863, Caltrain is the oldest continually operating rail system west of the Mississippi and the first railroad to convert from diesel to electric power in a generation.