California Transit Association Unveils Budget Blueprint to Address Pandemic-Induced Transit Operating Deficits

Requests $5.15 billion over the next 5 fiscal years to maintain services and meet California’s environmental, mobility, and equity goals

(Sacramento, CA) – Today, the California Transit Association unveiled its 2023 budget request to address California transit agencies’ pandemic-induced operating deficits and support the state’s environmental and equity objectives.

“Public transportation in California faces existential threats, including slow ridership recovery, a widening workforce gap, and an impending fiscal cliff as federal emergency funds run out before ridership has recovered,” said Senator Wiener (D-San Francisco). “Millions of Californians rely on public transportation to go about their lives, and transit is essential to reduce traffic congestion and air pollution. We must not abandon public transportation, and California needs to step up and throw our transit systems a stopgap lifeline.”

As transit agencies rebound from the long-lasting impact of the COVID-19 pandemic on commute patterns, ridership, and capital and operations costs, the budget request asks state leadership to provide $5.15 billion in funding from Fiscal Years 2023-24 to 2027-28 for transit operations pulled from a collection of state funding sources that have historically supported transit capital and operations. The budget request would deliver $1.213 billion in funding for transit operations in Fiscal Year 2023-24 alone. The funding, which would be applied to an estimated $6 billion statewide funding need, will allow the industry to continue day-to-day operations without having to reduce services or increase fares, while also acknowledging California transit agencies’ commitment to improving the rider experience by addressing the issues of safety and cleanliness on systems.

“As we look ahead, the challenges facing California transit agencies are significant, but we cannot allow the lasting impacts of the pandemic to undermine our public transit network. Instead, we must focus on securing funding that allows agencies to preserve, maintain, and eventually expand their services, and support the transformation of our industry into one that is cleaner and more adaptable,” said Michael Pimentel, Executive Director of the California Transit Association. “At the same time, we are also committed to playing active roles in broader societal efforts to address climate change and structural inequality.”

Since its founding in 1965, the California Transit Association has served as the leading advocacy organization and champion for public transit in California. In recent years, the Association has successfully advanced policy, regulatory and funding measures that are supporting the industry’s transition to zero-emission vehicles (ZEV). A recently released report by UCLA’s Institute of Transportation Studies found that financial shortfalls loom as agencies spend down the last of their federal relief funds and labor shortages are preventing many systems from providing desired levels of service.

Recognizing the state’s projected $22.5 billion funding shortfall, the Association’s budget request creates minimal General Fund impact. By maintaining transit funding at the levels committed to in prior years, this request will result in a $213 million reduction to General Fund revenue in FY 2023-24. Major elements of the Association’s budget request include:

  • Additional appropriation of revenue from sales tax on diesel fuel ($1.35B from FYs 2023-24 to FY 2027-28)
  • Additional appropriation of unallocated cap and trade revenue ($2.5B from FYs 2023-24 to FY 2027-28)
  • Conversion of transit capital funding to transit operations funding ($300M in FYs 2026-27, 2027-28)
  • Flexibility to use transit capital funding for transit operations (Up to $1B in FYs 2023-24, 2024-25)

The budget request also outlines the industry’s commitment to advancing policy solutions to address known impediments to growing transit ridership and achieving long-term financial and operational sustainability. Specifically, the budget request acknowledges the industry’s commitment to enhancing the rider experience by improving safety and cleanliness, and communicates the Association’s new support for SB 434 (Min) and AB 1377 (Friedman), legislation moving through the State Legislature that would help transit agencies address the incidence of street harassment and homelessness on public transit systems. The budget request also restates the Association’s commitment engaging the Newsom Administration and Legislature on implementing mutually agreeable reforms to transit service and accountability metrics to regrow ridership and establish fiscal stability over the next five years.


The California Transit Association (Association) is the leading advocacy organization and champion for public transit in California. The Association’s more than 220 member organizations include transit operators, commuter rail agencies, transit support groups, national and international transit suppliers, and government agencies. With a motivated and informed membership base, the Association actively engages State decision makers to shape transit-friendly policy, secure increased transit funding and promote the benefits of a balanced transportation system. The Association represents transit's interests before the California State Legislature, the Governor and regulatory agencies on the local, state and federal levels.

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