San Francisco’s public transit, devastated by pandemic changes to the city’s work patterns, is facing a huge budget deficit. The SF Municipal Transportation Agency has stretched out pandemic relief dollars as much as it can, but in the upcoming fiscal year of 2025-26, the last $250 million or so of those dollars will be spent.
There’s a hostile administration in Washington, and recent attempts to raise taxes and bridge tolls failed. Service cuts are now inevitable; a first round took effect this month, with more coming this summer to avoid a $50 million deficit.
Without longer-term fixes, the deficit could balloon to $320 million. There’s still hope of ballot measures in 2026 to raise taxes, but officials are also scrambling for more revenue this year. A 22-member working group, including SF Sups. Myrna Melgar and Rafael Mandelman, transit officials, union members, and advocates, have met twice a month since September to brainstorm other ideas.
Among them is one that some advocates feel is past due: make more SF drivers pay for parking in their own neighborhoods, which they’ve come to expect to be free.
Some neighborhoods already have this system: a two-hour parking limit unless you’ve got your designated neighborhood sticker. But many neighborhoods don’t.
The SFMTA official in charge of streets and parking floated the idea of raising the program’s fees in a working group meeting last month, adding the caveat that she wasn’t making an endorsement.
Such a caveat is no surprise. While it might seem straightforward to make every neighborhood pay its fair share for residential permits, driving and parking remain political lightning rods.
“We have to be careful and thoughtful with raising parking prices,” Sup. Mandelman tells The Frisc.
Even as Muni service cuts take effect, a deeper dive into one potential solution shows how difficult it will be to untangle the city’s transit funding knot.
Parking to the rescue?
“The biggest problem with charging for curb parking is politics.” UCLA urban planning professor Donald Shoup wrote that in one of his final papers. (Shoup passed away last week.)
Shoup also conducted a study of San Francisco’s dynamic pricing for its paid parking spaces and suggested improvements to bring in more revenue. In general, he advocated for more paid parking in cities.
Until the pandemic, parking fees and fines were a major source of funding for SFMTA. In fiscal year 2018-19, they accounted for nearly one-third of the agency’s revenues. In the current fiscal year, they made up only 16 percent.
SFMTA ridership is back up to 70 percent of its pre-pandemic level, better than some of its sister agencies. But its largest source of funding is shaky: San Francisco’s general fund, which provides 39 percent of SFMTA’s $1.4 billion operating budget.
But post-pandemic, Shoup’s warning has reverberated loudly. With alarms ringing about Muni’s budget back in 2023, SFMTA proposed extending parking meter hours to evenings and Sundays for an estimated $30 million annually in revenue.
The response from merchants worried about losing customers was so heated that the Board of Supervisors countered with a drastic measure: a charter amendment to require mayoral approval of all SFMTA fare and fee hikes. They withdrew the amendment after SFMTA agreed to drop the meter plan.
Residents and business owners ask ‘What am I paying for?’ when they don’t find open spots.
emma hare, legislative aide to sup. myrna melgar
But what about expanding a program that many small businesses actually agree with? SFMTA raises a modest amount of money, from $3 million to $5 million a year, through the residential parking permit (RPP) program. There are 31 areas around the city where residents and business owners buy $190 yearly permits that entitle them to park on the street without limits. Everyone else gets two free hours before risking a ticket.
At the Jan. 23 Muni Funding Working Group meeting SFMTA’s director of streets Viktoriya Wise said the 50-year-old program has two goals. One is to ensure that residents can find parking when they arrive home after work. The other is to encourage turnover of customers who drive to visit neighborhood merchants.
The program breaks even, said Wise, adding that the $190 annual permit fee is a bargain compared with the cost to rent a garage spot, which can reach into the thousands of dollars.
Transit advocate Zach Lipton recently pointed out that residential permit zones only cover about one-third of the city, which seems to beg the question: Why not do it for everyone?
The answer: the city can’t impose the zones. The program is a public initiative – that is, residents and merchants must start a petition and gain support from at least half their neighbors, then ask the SFMTA board of directors for approval.
In Wise’s presentation, she did not mention expanding RPP to new neighborhoods. She only talked about raising the annual fee to match price to demand.
Others question the wisdom of making RPP more expansive or expensive. Sup. Melgar says the program needs more enforcement before there are changes to its cost or structure. “It’s not working for anybody,” Melgar’s legislative aide Emma Hare told The Frisc. “Residents and business owners ask ‘What am I paying for?’ when they don’t find open spots,” she said.
Another top SFMTA official doesn’t think the political risk is worth a potentially modest bump in revenue. “There’s too much pain, not enough gain here,” SFMTA design strategy and delivery director Amanda Eaken said at the Jan. 23 meeting. (Eaken was also an SFMTA board member for six years.)
The political risk isn’t theoretical. An extra few million from an expanded RPP program pales in comparison with what a new tax or bond could reel in. SFMTA is eyeing the 2026 ballot, as well as voters already tetchy about street closures. (One bellwether will be the nascent effort to recall Sup. Joel Engardio for his push to permanently ban cars from the Great Highway.) One idea is a new ride-hail and autonomous vehicle tax; another would introduce an increased tax on non-residential utility use. They’re concerned about ballot fatigue, however.
Other ideas not necessarily tied to a ballot measure include charging short-term curb use fee for ride share, parcel delivery, and on-demand delivery — think Uber Eats, Waymo, and Amazon, among others.
There’s also consideration of SFMTA’s existing capital funds. A fraction of the agency’s budget for capital projects could be transferred to the operating budget but at a steep cost, said SFMTA capital budget and project controls manager Rob Jaques at the Nov. 20 working group meeting.
The agency could delay upgrades to its bus fleet — the average age is seven years — and defer other maintenance. This would generate more than $100 million in funds but also raise the risk of breakdowns that require emergency expenditures, akin to a person ignoring preventive care or minor ailments and ending up needing much more expensive treatment in the ER.
Meanwhile, Muni can’t wait. Service cuts have already begun.
Chinatown pushback
In November, the warnings of service cuts finally took shape. SFMTA announced reductions across several bus lines would soon take effect.
Most of them kicked in on Feb. 1. The 24 Divisadero, 38 Geary, and 43 Masonic now run less frequently during midday hours, and the K Ingleside and M Ocean View run one-car trains on weekends.
Two of the five morning trips for the 1X California — which restarted downtown commute service in 2023 after a pandemic hiatus — were canceled. Those extra routes were added to the 30X Marina Express route. The evening commute runs on both routes have been canceled.
One set of changes hasn’t happened as quickly. The 30 Stockton runs from the Presidio through the Marina, Chinatown, Union Square, and South of Market before turning around at the CalTrain station. It’s rather complicated, with a “long” and “short” version of the route. The altered short route will run from one terminus near Ghirardelli Square to Union Square instead of running through SoMa to CalTrain.
Backlash came immediately. In a Nov. 27 letter, the Chinese Chamber of Commerce and other Chinatown organizations asked SFMTA to wait until after Lunar New Year, “the most important time for Chinatown’s economic vitality.” SFMTA obliged, delaying the changes until Mar. 15.
The organizations also spread confusion about the cuts themselves by mischaracterizing the new route plan. (The Frisc looked into their claims and declined to write about them.) But the Chronicle ran an opinion piece from a local physician last month that amplified the incorrect claims and triggered a response from SFMTA: “There is some confusion regarding the status of the 30 Stockton resulting from today’s op-ed in the SF Chronicle. Here are the facts.”
Get ready for more upset. This summer will see more cuts to help fill an immediate $50 million hole when the new fiscal year begins in July. SFMTA is in the process of choosing between a set of scenarios to save $15 million. These range from suspending routes entirely to reducing bus and train frequency; the rest will be made up with fare enforcement and parking revenue.
The working group has bigger ideas to bolster the agency beyond July. One idea is to cut overall Muni service in half, which could generate $63 million in savings. Another — suspending lower-utilized routes like the 33 Ashbury — could save the agency $71 million. They also proposed suspending historic streetcar service or privatizing it.
Muni officials know that cuts to save public transit could have the opposite effect, leading to a downward spiral. Less frequent and reliable service could push away riders who have alternatives, leading to even less revenue and more cuts. San Francisco’s chief economist Ted Egan added recently that it could even “lead to more drivers,” an estimated increase of more than 50 percent, according to a resolution from Sup. Melgar.
More drivers means more dangerous streets, more congestion that frustrates public transit, and more air pollution. And if the city ends up expanding the residential permit program, it also would mean more bitter irony. SFMTA could raise more money for public transit, but what would be left to fund?
I’m a driver. I would be amenable to paying more for street parking if the dollars spent by MTA over the past few years were, in fact, beneficial – or at least minimally adversarial – to drivers. License other road users – bicyclists, et al – before making me for more money.