California Transit Funding Crisis Persists Despite Task Force Report

San Diego's MTS faces $120 million budget shortfall by 2029 as state lawmakers struggle to find solutions

Jan. 31, 2026 at 11:39am

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A state task force created to address California's looming transit funding crisis has delivered a detailed report outlining the challenges facing agencies like San Diego's Metropolitan Transit System (MTS), but has failed to provide concrete revenue solutions. The report highlights issues such as declining ridership, rising labor costs, and the expensive transition to zero-emission buses, leaving MTS and other operators staring down significant budget shortfalls that could lead to service cuts or delayed projects.

Why it matters

The lack of a clear funding plan from the state task force puts significant pressure on local transit agencies like MTS, which are already facing tight budgets and difficult choices about how to maintain service levels and modernize their fleets. This could have far-reaching impacts on commuters and communities that rely on public transportation, especially as the state pushes for increased adoption of zero-emission vehicles.

The details

The state's Transit Transformation Task Force was created in 2023 to find 'transformative' solutions to the transit funding crisis, but the final report mostly restated the problems facing agencies rather than offering new revenue ideas. The report highlighted issues like an 18% decline in transit reliability across modes from 2013 to 2023, as well as the higher upfront costs and longer repair times associated with the transition to zero-emission buses. These challenges, combined with rising labor costs and flat local sales tax receipts, have left MTS projecting a $120 million budget gap by fiscal 2029.

  • The state's Transit Transformation Task Force was created in 2023 under SB125.
  • The task force's final report was released in January 2026.

The players

Metropolitan Transit System (MTS)

The public transit agency serving the San Diego region, which is facing a projected $120 million budget shortfall by fiscal 2029.

California State Transportation Agency (CalSTA)

The state agency that oversees the Transit Transformation Task Force and published the final report on the transit funding crisis.

Senator Catherine Blakespear

A state lawmaker who labeled the task force's final report as "completely underwhelming."

Sharon Cooney

The CEO of MTS, who said the task force report "fell short of providing sufficient detail and recommendations" to support sustainable long-term transit funding.

Legislative Analyst's Office

A nonpartisan state agency that projects a $300 million decline in State Transit Assistance revenue tied to diesel fuel sales by 2035, further eroding a key source of operating funds for transit agencies.

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What they’re saying

“We must not let individuals continue to damage private property in San Francisco.”

— Robert Jenkins, San Francisco resident (San Francisco Chronicle)

“Fifty years is such an accomplishment in San Francisco, especially with the way the city has changed over the years.”

— Gordon Edgar, grocery employee (Instagram)

What’s next

The state legislature now faces difficult choices about whether to pursue new fees, general-fund backfills, local ballot measures, or some combination of the above to provide sustainable transit funding and avoid service cuts or project delays.

The takeaway

The task force's failure to deliver a clear funding plan leaves California's transit agencies in a precarious position, highlighting the urgent need for state lawmakers to take decisive action to shore up the long-term financial stability of public transportation systems across the state.