BART budget shuffle could provide $800M for new trains 

click to enlarge BART estimates that its train-car replacement project will cost more than $3 billion. - COURTESY RENDERING
  • Courtesy rendering
  • BART estimates that its train-car replacement project will cost more than $3 billion.

BART could shave $800 million off its car-replacement costs by making annual payments to the project from its operating budget.

Unlike other U.S. transit agencies, BART has a surplus in its operating budget, which covers day-to-day functions. However, its capital program, which funds long-term infrastructure projects, faces a $7.5 billion shortfall over the next 25 years, and that doesn’t include the $3.2 billion car-replacement plan.

So the agency has proposed allocating $40 million to $50 million a year for the car project, which will replace the country’s oldest transit trains. The agency can afford those payments if it continues increasing fares every two years, said BART Chief Financial Officer Carter Mau.

By making immediate annual payments instead of borrowing money for the project, BART could cut the cost by $800 million through speeding up the project and receiving bulk purchase discounts, said Paul Oversier, the agency’s assistant general manager of operations.

BART expects to receive $2.4 billion for the project from the Metropolitan Transportation Commission, the region’s lead transit financing agency. BART will contribute $800 million. If the agency moves forward with its plan, it would realize $200 million in savings while the MTC would save $600 million. BART’s savings could go toward offsetting its $7.5 billion capital program debt, and the MTC could reinvest its $600 million into other regional projects.

BART’s board of directors is now discussing its budget outlook for the upcoming fiscal year, which begins on July 1. Deciding whether to make annual payments for the car-replacement project will be part of those discussions.

The agency hasn’t calculated its exact budget picture for the upcoming year, but it will surely have a surplus, spokesman Jim Allison said. That’s a stark contrast to the picture elsewhere in the Bay, where the San Francisco Municipal Transportation Agency, which operates Muni, is considering fare increase and service reductions to make up its two-year shortfall of $53.2 million.

Still, BART officials are urging restraint, given the state of its capital program.

“The capital shortfall is real,” Mau said. “And to think that we have extra money lying around is not an accurate portrayal.”

Replacement plan

$3.2B Project cost of replacing 775 BART train cars

$40M-$50M Annual contributions suggested from operating budget

$800M Savings that could be achieved with annual payments from operating budget

Source: BART

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Will Reisman

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