Newsom Agrees to $590 Million Loan for Bay Area Transit

The loan aims to provide temporary relief as long-term funding measures are pursued.

Jan. 31, 2026 at 8:47pm by Ben Kaplan

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Gov. Gavin Newsom and state officials have agreed to provide a $590 million loan to Bay Area transit agencies, including BART and San Francisco's Municipal Transportation Agency. The loan is meant to tide over the transportation agencies while long-term funding measures are pursued, including a potential regional funding measure on the November 2026 ballot.

Why it matters

Bay Area transit systems have been facing severe budget deficits and the threat of major service cuts. This loan provides temporary relief as lawmakers work to secure more stable, long-term funding for public transportation, which is essential for the region's economy and communities.

The details

The $590 million loan is significantly smaller than the $750 million infusion local lawmakers said the governor had pledged last year. Even with the new funding, agencies receiving the loan face a combined projected deficit of more than $800 million in the next fiscal year. BART alone is projecting a $376 million operating deficit in fiscal year 2027 and is considering service reductions, station closures, fare increases, and layoffs to close the gap.

  • The loan agreement was reached on February 1, 2026.
  • A regional funding measure that could appear on the November 2026 ballot would establish a temporary 14-year sales tax to support transit operations starting in mid 2027.

The players

Gavin Newsom

The Governor of California who agreed to provide the $590 million loan to Bay Area transit agencies.

Scott Wiener

A California state senator who authored a regional funding measure that could appear on the November 2026 ballot to support transit operations.

Jesse Arreguín

A California state senator who co-authored the regional funding measure that could appear on the November 2026 ballot.

Bob Powers

The general manager of BART, who said the agency is developing ways to close its projected $376 million operating deficit in fiscal year 2027.

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What they’re saying

“California is following through in our support for Bay Area transit and the riders who rely on it every day. Public transit is essential to our economy and to communities across California, and through continued partnership with regional and local agencies, we are delivering a more stable and reliable system — now and for the future.”

— Gavin Newsom, Governor of California (sfchronicle.com)

“Today is a huge win for Bay Area transit and for both transit riders and drivers. For the past year, we've worked hard to craft a bridge loan to ensure BART, Muni, Caltrain and AC Transit are not forced to enact massive service cuts — potentially going into a death spiral — as we build toward a regional revenue measure to stabilize and strengthen these systems for the long run.”

— Scott Wiener, California State Senator (sfchronicle.com)

What’s next

A regional funding measure authored by Senators Wiener and Arreguín could appear on the November 2026 ballot in five Bay Area counties. The measure would establish a temporary 14-year sales tax to support transit operations beginning in mid 2027.

The takeaway

This loan provides temporary relief for Bay Area transit agencies facing severe budget deficits, but long-term funding solutions are still needed to ensure the stability and reliability of public transportation in the region, which is essential for the economy and local communities.