If San Francisco’s next mayor were to cancel the Central Subway project, the federal government could ask The City to pay back nearly $100 million.
The San Francisco Municipal Transportation Agency hopes to hear back soon about a $942 million federal grant that would complete funding for the $1.58 billion extension of the T-Third line. However, city attorney and mayoral candidate Dennis Herrera has vowed to nix the project if elected.
If that happens, the $200 million the agency has already invested in the subway would all be lost. And the portion of that total that came from the federal government, $92.4 million, might have to be paid back, according to SFMTA Government Affairs Manager Kate Breen.
Following Gov. Chris Christie’s decision to back out of an $8.7 billion rail tunnel project in New Jersey, the U.S. Department of Transportation demanded a $271 million refund from New Jersey Transit. Some $600 million had already been spent on the project, and now the federal government is demanding repayment of its contribution, according to New Jersey Transit spokesman Paul Wyckoff. The agency disputes the repayment demand, he added.
It is also possible, though unlikely, that state officials could ask the SFMTA to pay back another $14 million in state funding, SFMTA spokesman Paul Rose said.
Herrera’s campaign spokesman, Matt Dorsey, counters that the short-term hurt of any lost funding would be offset by the long-term benefits of cancelling a costly mistake.
“The notion that taxpayers must save tens of millions of dollars by wasting hundreds of millions of dollars is absurd,” Dorsey said. “San Francisco has a long history of stopping ill-considered public works projects that have had federal funding, and we’re the better for that.”
Breen said any money returned to the federal government would likely have to come from the agency’s capital program, which covers long-term infrastructure improvement projects such as vehicle replacement and Bus Rapid Transit for Geary Boulevard and Van Ness Avenue.
In New Jersey, Christie’s decision ended that project before it completed an important federal risk assessment milestone, Central Subway project manager John Funghi noted. Yet the SFMTA’s railway has already passed that stage, and retains the support of Mayor Ed Lee, the Board of Supervisors, and state and federal legislators.
Even so, SFMTA executive director Ed Reiskin said fraying support for the project does not help it with federal officials.
“This isn’t irrelevant,” Reiskin said. “Having a project that may appear to have questions in terms of local support, it’s not helpful, to be honest.”
Still, Reiskin said he is confident that the next mayor — whoever it is — will continue to support the Central Subway.
“This has been more vetted and analyzed than any other public works project in San Francisco,” Reiskin said. “I’m confident that no matter who ends up in Room 200, they would be very unlikely to pull a Christie and pull the plug on this thing.”
The SFMTA hopes to hear back on its $942 million federal grant application by early next year.
Where the money came from
The SFMTA has received $248 million in funding for the Central Subway, of which $200 million has already been spent. These were the sources of funding:
- Federal new starts: $92.4M*
- Federal CMAQ: $41M
- State infrastructure bonds: $23.5M
- State traffic congestion: $14M*
- Local Prop. K sales tax: $77.3M
- Total: $248M
*Might have to be paid back.