Last week was a week of contrasts for the commuter rail line that connects San Francisco to the Peninsula and South Bay. At the start of the week, Caltrain was poised to certify an environmental impact report, thus formally approving and adopting its electrification project. This would be a big milestone, as it would finally move this long-stalled project forward and make it eligible for funding. However, at the April 1 Joint Powers Board meeting, any excitement about reaching this milestone was quelled. Caltrain agreed to postpone project approval because of public comment that was submitted, which essentially threatened that a lawsuit would be filed, alleging violation of the California Environmental Quality Act, if the EIR was certified. But there was also a matter of more immediate concern: a potentially devastating budget deficit was announced.
Caltrain, unlike other transit operators that have been deprived of State Transit Assistance funds, does not enjoy a dedicated revenue source. Rather, its operations depend mostly on farebox revenue and contributions from San Francisco, San Mateo, and Santa Clara counties, the three member agencies that make up the Joint Powers Board. It’s no small problem, then, that San Mateo has suggested it may reduce its contribution by 70%, which would trigger corresponding reductions from San Francisco and Santa Clara. The end result, if that were to happen? A roughly $30 million budget deficit off of a $97 million budget. Caltrain has indicated that balancing the budget under those circumstances might require cutting all off-peak service — midday, nights, and weekends — by no later than June 2011.
It hardly needs to be said that this would be a fundamental change for the worst. It would reduce rail service on this corridor to bare commuter operations, while decimating the utility of Caltrain for transit-dependent and recreational off-peak riders. If such a deep service cut were approved, it would be a giant leap backwards, in the exact opposite direction from where Caltrain should be headed as it moves toward electrification.
It is not yet clear whether the situation will actually turn out to be that bad. So far, all we have had to go on is Mike Scanlon’s initial doomsday pronouncement at the April 1 JPB meeting. Clearly, though, there will be an important discussion in the near future about Caltrain’s upcoming budget and the viability of its service. In some sense, Caltrain has so far held on surprisingly well under the circumstances, since it was able to deflect an unpopular cut to weekend service when closing a $10.1 million budget deficit for this fiscal year. But ridership has decreased as compared to last year, so there is reluctance to further depress ridership by increasing fares — and even a steep fare hike would not be nearly enough to close a $30 million deficit. State funding, restored by the gas tax swap legislation, would also not be enough, providing Caltrain with just $5.1 million for this fiscal year and $4.5 million in FY12. With the JPB’s three member agencies threatening to turn inward and reduce their financial support to Caltrain in these tough economic times, there are limited options available under the current governance scheme that would ensure Caltrain’s long-term financial sustainability.
Passenger rail on the Peninsula was almost laid to rest in the 1970s, but was ultimately saved. It could be saved again (though the threat now does not look that severe). But is there the political will to make the necessary changes? Caltrain has come a long way even with minimal means, but it has been subject to the whimsy of its member agencies, who have other priorities. Meanwhile, the progress that has been made on electrification has been sluggish, even though electrification points the way toward the promise of the future. Since introducing Baby Bullet service, Caltrain has assumed a more prominent role in the Bay Area’s regional rail network, but it has outgrown its existing, primitive method of financing. It is worthy of a three-county special district, along the lines of the BART district. By reconstituting as a special district, Caltrain would be granted valuable taxing authority and dedicated funding. Making this change will not be easy, because it requires enactment at the State level — but doing so would give Caltrain access to tax revenue, while ensuring the security of future service.