Income from Shared Spaces will provide financial resources to the San Francisco Municipal Transporation Agency, according to its director, Jeffrey Tumlin. (Kevin N. Hume/S.F. Examiner)

Income from Shared Spaces will provide financial resources to the San Francisco Municipal Transporation Agency, according to its director, Jeffrey Tumlin. (Kevin N. Hume/S.F. Examiner)

SFMTA director says Shared Spaces serves transit agency’s financial interest

$10.6 million price tag for program raises concerns among transit agency’s board members

Shared Spaces is good for small business, but it’s also beneficial to the San Francisco Municipal Transporation Agency.

That’s what Jeffrey Tumlin, who sits at the helm of SFMTA, told the Board of Directors on Tuesday.

“We feel very strongly about our role at this time in supporting San Francisco’s economic recovery, even if that means using our operating funds to support it,” he said.

According to SFMTA’s own staff report, the program will cost the agency an estimated $10.6 million annually, a result that pits the cost of staff hours and foregone parking meter revenue against partial cost recovery through permit fees for parklets and roadway closures.

Tumlin countered this take was an oversimplification, pointing to “compensatory financial factors,” chief among them sales tax revenue generated by restaurants and other small businesses.

Every year, SFMTA receives a big chunk of change from the General Fund, a pot of money collected by The City through a litany of sources such as sales tax, property tax, business tax and hotel room tax, among numerous others, then doled out in various amounts to different city agencies.

For the current fiscal year, the General Fund was projected to be the agency’s largest single source of revenue at 34 percent of SFMTA’s operating budget, closely followed by revenue earned from parking fees and fines at 31 percent. Transit fares and operating grants close the remaining gaps.

According to the City Controller’s most recent projections for next fiscal year, which begins July 1, 2021, total citywide sales tax revenue is expected to be $156.1 million. Earnings from property taxes and business taxes are projected to be roughly $2.1 billion and $957.1 million, respectively, while hotel room tax revenue is charted at $78.5 million.

Tumlin’s point is that the more sales tax revenue increases, the more money there is to be spread around between various city agencies, including SFMTA, and Shared Spaces can help spur such spending, especially this summer as the pace of recovery is likely to accelerate.

“It is very much in the SFMTA’s financial interest to ensure small business survival in San Francisco,” he said on Tuesday, adding the agency is committed to playing its part in making that possible.

Director Steve Heminger pointed out, however, that in a presentation with more than 40 slides, not one was dedicated to projected program costs, an omission he found concerning given the agency’s current inability to fund and staff full Muni service.

“I do worry about the trend we’re establishing here about policies and programs, however meritorious, sort of making a move on our dedicated revenue,” Heminger said.

Tumlin said other cost mitigation factors were on the table, including making adjustments to parking meters such as extending the hours they charge vehicles to park or adding meters in commercial zones.

Board members were enthusiastic about this idea conceptually, but no details were discussed.

Ultimately, Heminger proposed an amendment to the resolution setting a long-term goal for the agency to achieve cost recovery in the Shared Spaces program. More a values statement than prescriptive, it lacks deadlines for achieving cost recovery and repercussions if it’s not reached.

He described it as a board commitment that “it is not our intent to provide a $10 million subsidy to the Shared Spaces program at the expense of Muni forever.”

The resolution passed 6-1. The only dissenter was Director Sharon Lai, who doubled down on her support for Shared Spaces as a subsidized program as opposed to one that incorproates full cost recovery.

“This is effectively an investment by the MTA into our community,” she said. “Not just the business community but also the urban community.”

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