SamTrans keeping close eye on structural deficit

Fiscal Year 2025, which ended in June, had a deficit, though one-time funds were able to cover the difference, Chief Financial Officer Kate Jordan Steiner said during a Board of Directors meeting Nov. 5. 

“The [sales tax] revenues for Fiscal Year ’25 did finish below budget, reflecting the slower local and regional economic activity, driven by economic uncertainty, tariffs, policy shifts from the new administration and inflation,” Steiner said. 

However, expenses were about 10% lower than anticipated, “driven by lower consultant usage, lower [American Disabilities Act] and multimodal shuttle usage,” Steiner said. 

For the current fiscal year, sales tax revenue is expected to remain flat. 

“The short-term outlook has improved, but this is largely driven by one-time savings and timing. We have a structural imbalance in our operating budget, and there’s increasing pressure on our operating budget, as we’ve exhausted the prior year carry-forwards,” Steiner said. “We’re experiencing a slowdown in sales tax and also the decline in certain state and federal funding.”

In June, SamTrans adopted a $323.7 million operating budget for this fiscal year — from July 2026 to June 2027 — with the Fiscal Year 2027 operating budget projected at $339 million, however, it still has anticipated a modest structural deficit. One-time funds were able to close the gap last year, but after 2027, those funds will be exhausted, according to a previous press release from SamTrans. 

The projections speak to the financial challenges most transit operators are facing throughout the region. While the bulk of the funds would go to rail agencies like BART and Caltrain, a ballot measure, if passed by voters, would impose a regional 14-year sales tax measure to help shore up operator deficits.