Because the Metropolitan Transportation Fee considers its choices for a regional income measure for 2026 subsequent week, leaders from Santa Clara County have notified the company that they won’t opt-in on its method and will as an alternative search their very own tax measure ought to polling knowledge point out voter help.
Final month, members from the Valley Transportation Authority Board despatched a letter to the fee indicating their place of sustaining better management of native funds — emphasizing the necessity to obtain a fair proportion — which they mentioned was in one of the best curiosity of their taxpayers and the transit companies working within the county.
“We’ve made clear that we have to have control over our own destiny and maintain, first and foremost, our own funding sources and services levels here,” mentioned San Jose Mayor Matt Mahan, who was appointed vice chair of the VTA Board of Administrators.
The MTC is contemplating a regional funding measure to assist struggling Bay Space transit operators like BART, the San Francisco Municipal Transportation Company, and Caltrain, that are at present straddling the monetary cliff.
Between the struggling companies within the 9 Bay Space counties, lots of of tens of millions of {dollars} are wanted to offset deficits primarily brought on by the shortcoming to recuperate ridership for the reason that pandemic.
One of many present situations on the desk features a half-cent gross sales tax for not less than San Francisco, Contra Costa, Alameda and San Mateo Counties with possibility for the opposite counties to “opt-in.” If solely the 4 base counties are included, a gross sales tax would generate an estimated $540 million per 12 months. A regional measure might generate roughly $1 billion per 12 months if a tax consists of all 9 counties.
The MTC has additionally checked out a hybrid mannequin to generate revenues via payroll and gross sales tax. Between the 9 counties, it might generate roughly $1.5 billion yearly.
Nevertheless, the VTA doesn’t face the identical monetary pressures as different transit operators as a result of Santa Clara County taxpayers subsidize public transportation to a far better extent than another counties within the Bay Space.
The VTA is primarily funded via 4 current gross sales tax measures – not farebox revenues like the opposite companies – producing practically $900 million yearly.
These taxes accredited by the voters embody:
1976 Measure A — a everlasting tax that generated $275.3 million in fiscal 12 months 2023.
2000 Measure A — a tax that expires in March 2036 and generated $275.3 million in fiscal 12 months 2023.
2008 Measure B — a tax that expires in March 2042 and generated $67.2 million within the fiscal 12 months 2023.
2016 Measure B — a tax that expires in March 2047 and generated $273 million in fiscal 12 months 2023.
When the idea of a regional tax measure and company consolidation was broached via potential laws earlier this 12 months, the VTA’s board raised considerations about how a regional measure might influence the power to reauthorize one among its sunsetting gross sales tax measures. It additionally questioned how the funds could be allotted and whether or not they would greatest serve its taxpayers, as roughly one-quarter of income would come from Santa Clara County.
Though that invoice finally was pulled as a consequence of a scarcity of help, among the identical considerations stay, particularly with guaranteeing that Santa Clara County taxpayers will not be subsidizing different companies.
“Any mandate on this county to participate legislatively speaking in a sales tax as far I’m concerned, as far the mayor is concerned and I think the entirety of the Council, would need to have return-to-source,” State Sen. Dave Cortese mentioned at Tuesday’s San Jose Metropolis Council assembly. “(It’s) no fair taking the largest sales tax paying population … here in San Jose and Santa Clara County and shipping that money, for example, to San Francisco to support the fiscal cliff.”
Whereas the MTC might present better readability on what a regional method might appear to be subsequent week, what is understood now could be that Santa Clara County might want to reauthorize a gross sales tax measure within the subsequent decade if it needs to keep away from the identical challenges different transit operators are dealing with and improve service ranges sooner or later.
Regardless of its want to pursue a parallel tax measure, Mahan mentioned proceeds would additionally assist out different struggling companies like Caltrain and BART, which function within the county, as a result of the VTA already at present helps to help these companies.
“We have existing agreements that can be updated,” Mahan mentioned. “We can contribute more as long as it is done through a principle of fair share, so we don’t need a new framework or vehicle for this.”
