Caltrain in dire need of funding

But MTC is using a new formula for allocating that second tranche, which officials now expect to total between just $7 million and $15 million.

Caltrain’s second tranche is anticipated to be that much lower than initial expectations because MTC’s new formula assumes a sharp continued decrease in sales tax revenue through the end of the year, said Seamus Murphy, chief communications officer for Caltrain. As a result, more money goes to sales tax dependent agencies such as SamTrans and less to fare dependent agencies such as Caltrain and BART, Murphy said. Caltrain gets 70% of its funding from fares

A $15 million second tranche, if approved by MTC next month, may not be enough to keep Caltrain running through the year, Murphy said.

“Even if [the second tranche totals $15 million] it’s not likely that’ll be enough to carry Caltrain through the end of the year if the most pessimistic ridership projections actually happen,” Murphy said. “We’re going to need ridership to return somewhere near half of what it normally is by the end of the year for us to fully cover with the addition of the second tranche of funding the revenues Caltrain needs to stay afloat.”

Ridership has dropped by a whopping 98% due to COVID-19 and ensuing shelter-in-place order, and service was significantly reduced in response. Since service was expanded on June 15, though not to normal levels, ridership appears to be growing, Murphy said.

“We’re still trying to quantify by how much, but we’re looking at the most recent data and it does look like offering that better service in June has resulted in an uptick in ridership,” Murphy said. “Anecdotally, ridership counts seem to be up fairly significantly. It’s trending in the right direction, but nowhere near where we need it.”

If ridership adheres to pessimistic projections, then some form of external revenue will be needed to keep the trains running, Murphy said. That may have to come in the form of significantly increased contributions from San Mateo, San Francisco and Santa Clara counties — the three counties that are served by Caltrain and also cover its costs in addition to fare revenue.

The other potential revenue source is a 1/8-cent sales tax in the above three counties. That effort is slated for the November election, but significant hurdles stand in the way, officials said.

Caltrain Board Member Dave Pine, also a San Mateo County supervisor, has doubts about the support that can be expected from businesses to mount a successful tri-county campaign.

“The ability to mount a campaign across three counties is the biggest challenge,” Pine said. “My sense is there’s less capacity among businesses than prior to the pandemic and we’re also short on time.”

Pine noted Measure W, the 2018 sales tax hike in San Mateo County for SamTrans, enjoyed a $1.3 million campaign effort, largely funded by businesses, and only passed by a couple hundred votes.

“The measure [slated for the November election] would require an effort in three counties. It’d take a considerable amount of campaign funding,” Pine said. “I am concerned about our ability to obtain the commitments needed to fund the campaign.”

But Murphy painted a more optimistic picture about the role of the business community in passing a tax for Caltrain.

“We’re optimistic about the likelihood that this ballot measure would be fully supported by a broad coalition of very influential stakeholders interested in preserving Caltrain as a transit option in future,” he said.

Recent polling suggests a Caltrain sales tax, which needs support by a combined two-thirds of voters in the three counties served by the railroad, is politically viable, Murphy said.

Of the 1,255 likely voters polled, 63.3% indicated support for the 1/8-cent sales tax, according to the agency. After learning more about the benefits that would be achieved with an increased investment in the system, support increased to 70.9%.

“I did not expect polling to be as strong as it was so that gives me a glimmer of hope,” Pine said.

zachary@smdailyjournal.com

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