Voters allowed too-easy money for the SFMTA

The San Francisco Municipal Transportation Agency board of directors took a vote on Tuesday that could put The City’s taxpayers in the hole for a whopping $170 million in revenue bonds — not counting interest payments that can come close to doubling such bond issues.

At first glance, it might seem rather odd that a local agency can dump so much into its public bond debt without obtaining direct approval by a citywide voter referendum. But guess what, you — the San Francisco voter and taxpayer — virtually gave the SFMTA an open checkbook to do that.

This permission was somewhat stealthily included in Proposition A, a 2007 ballot measure approved by 55 percent of San Francisco voters. Prop. A was sold to the citizenry as a measure for giving the SFMTA greater authority over parking administration, a change touted as a painless way to give deficit-ridden Muni an extra $26 million a year in revenue.

The fact that SFMTA, which is projected to have long-term debt, will be able to borrow against future earnings should concern taxpayers and transit riders alike. These bonds must only pay for system improvements; the money cannot legally be used toward the SFMTA’s currently projected two-year operating deficit of $80 million. Of the $170 million approved by SFMTA directors, $50 million is for fixing up creaky city-owned garages, nearly $50 million is pledged for long-term Muni system improvements, and a third $50 million would buy back and refinance the SFMTA’s existing debt at the historic lows of the current bond market. The extra $20 million was added just in case of any cost overruns.

We won’t argue with the seeming reasonableness of these expenditures. But unfortunately the SFMTA is all too familiar with cost overruns. A recent independent audit found that the transit agency has wasted an astonishing $90 million on its pending capital projects by consistently going over budget.

As of now, all that needs to be done for authorizing final release of these bonds is an approval vote by the Board of Supervisors, which is penciled in for the March schedule. Our supervisors are not exactly known for refusing to spend money that can be allocated by a simple majority “yes” vote. But if enough public protest arises, they might well prefer playing the role of tough fiscal watchdogs and put a lid on those suspect work orders instead of rubber-stamping the bond issue.

editorialsOpinionSan FranciscoSFExaminer

If you find our journalism valuable and relevant, please consider joining our Examiner membership program.
Find out more at www.sfexaminer.com/join/

Just Posted

Crab fisherman Skip Ward of Marysville casts his crab net out off a pier near Fort Point. (Craig Lee/Special to The	Examiner)
San Francisco came back to life, and we captured it all

Last spring, in the early days of the pandemic, the bestselling authors… Continue reading

Revelers at Madrone Art Bar in the early hours of June 15, 2021 (Courtesy Power Quevedo).
No social distancing at Motown-themed dance party

‘I don’t care how anyone feels, I just want to dance!’

<em>The San Francisco Peace Pagoda stands tall in between Japan Center East and West malls.</em>
 (Ida Mojadad/The Examiner)
Patrons return to the Japantown mall

‘We’re so happy—it’s really hard to make a profit’

Scenes from an SFO-bound BART train on Tuesday, June 15, 2021, the day California fully reopened for business after the COVID pandemic. (Al Saracevic/SF Examiner)
SF reopens: BART riders dreading the end of the pandemic

‘I’ve forgotten what it’s like to be packed like sardines’

Micael Butial stands as he holds an umbrella that he painted with the words “Stop Asian Hate” at a rally held to show support for Asian and Pacific Islanders communities, Sunday, March 21, 2021 in San Francisco. (Photo by Ekevara Kitpowsong/Special to S.F. Examiner)
Inside the California organization tracking anti-Asian hate incidents

By Mallika Seshadri CalMatters Richard Lim was walking along a quiet sidewalk… Continue reading

Most Read