Of late, the City’s massive budget deficits and cuts to transit operating budgets have dominated the headlines. However, the American Reinvestment and Recovery Act has breathed new life into one major transit project in downtown San Francisco. This week, we’ll give you an overview of the revenue measures the City is considering to cover the multimillion dollar deficit in MUNI operations, and on the Transit Center project, which is moving forward in spite of the City’s budget woes.
Municipal Transportation Agency – Revenue Measures Likely To Go On Ballot
The SFMTA is San Francisco’s all-purpose transportation agency that oversees parking, traffic and transit operations. This year’s projected multimillion dollar deficit has sent the City scrambling to find new sources of revenue to avoid painful cuts in MUNI service. Some of these new revenue proposals — especially those to increase parking meter rates, install new meters, and extend their hours — have received the lion’s share of press coverage.
However, these are not the only measures being considered. The SFMTA Board is also looking at several revenue measures that could be placed on the November 2010 ballot. These include:
- An increase in the hotel occupancy tax from 14 percent to 15 percent, which would raise $11 million annually.
- An increase in the payroll tax from 1.5 to 1.75 percent, which would raise about $55-$60 million each year.
- A proposal to raise the tax on commercial parking garages from 25 percent to 35 percent, which would generate about $20 million per year.
- A $200 parcel tax on each residential and commercial parcel in San Francisco.
- A sales tax increase of 0.5 percent that could generate up to $65 million in new revenue. This would take the City’s sales tax rate to 10.5 percent, the highest in the state.
- An increase in the vehicle license fee from 1.5 to two percent, which would generate about $33 million in annual revenue.
The deadline for submittal of measures for the November ballot is June 15, 2010. Ballot measures to increase the sales tax or vehicle license fees would have to be submitted to the voters by the Mayor or Board of Supervisors. The SFMTA may submit any of the other revenue measures directly to the voters without approval of the Mayor or Board of Supervisors. Any measure submitted directly by the SFMTA requires a 2/3 vote to be enacted, whereas a lower threshold for approval may suffice for measures submitted by the Mayor or the Board of Supervisors.
At their meeting yesterday, several members of the SFMTA Board spoke favorably of the parking tax increase, because it could be approved by a simple majority of voters if placed on the ballot by the Board of Supervisors and is therefore more likely than the other measures to succeed. However, all options remain on the table and are likely to be considered again by the SFMTA Board in May.
Transit Center Update
The proposed Transit Center is a $4.2 billion multimodal transit facility that will replace the Transbay Terminal on Mission Street. The Transbay Joint Powers Authority (“TJPA”) is a special body comprised of local elected officials and representatives from several transit agencies. It is responsible for overseeing the construction and operation of the facility. If all goes as planned, the Transit Center will eventually serve nine transportation providers and 45 million passengers annually. It will anchor major new office and residential districts with 5.4 acre rooftop park and new retail on Natoma and Minna Streets.
As with any major public infrastructure project, financing is complex and comes from a multiplicity of sources. The Transit Center is no exception: its construction is to be funded through a combination of federal and state funds, as well as revenues derived from the sale of surplus properties formerly occupied by overhead ramps for the Embarcadero Freeway. The Transit Tower, a proposed 1200 foot tall building on the Transit Center site, was also supposed to generate approximately $300 million in construction funding.
The sharp decline in the real estate market in 2007 jeopardized the funding stream for construction of the Transit Center and led to speculation that construction could be delayed for many years. The TJPA put the Transit Center project on hold in mid-2009 as it waited for the federal government to review applications for stimulus funds. In early 2010, the federal government granted a $171 million loan to the TJPA and awarded $400 million in stimulus funds.
With funding in place, the TJPA is now poised to proceed with the $1.2 billion first phase of the Project, which is scheduled for completion in 2015. This will include: demolition of the existing Transbay Terminal and Bay Bridge bus ramps; utility relocation, construction of the new terminal and Bay Bridge bus ramps. The new terminal will include a “train box” for future CalTrain service. However, construction to extend the tracks from CalTrain’s 4th & King Station will be carried out in the second phase of construction.
According to the construction schedule, demolition, shoring and excavation is slated to start this Spring. Utility relocations are already underway. The temporary terminal at Howard and Main Streets is expected to open for business in May, and demolition of the existing terminal should commence in July. Demolition work will proceed in three overlapping phases over approximately ten months:
- Phase 1 – Demolition of bus ramps east of Fremont Street (Weeks 1-12)
- Phase 2 – Terminal demolition (Weeks 5-30)
- Phase 3 – Demolition of bus ramps west of Fremont Street (Weeks 27-40)
Because the demolition works will span over city streets, there will be intermittent street closures on several major streets, including Folsom, Harrison, Fremont, Beale and First Streets. Most will be limited to evenings and/or weekends, but there will be intermittent weekday closures as well. Utility relocation is already underway and will continue until the end of the year. The TJPA has released schematics of planned utility upgrades that may be of interest to those that own property nearby.
Excavation and shoring wall construction is also scheduled to commence this year. Substantial construction on the below-grade structure and train box is supposed to begin in early 2012 and on the above-grade structure in mid-2013. Completion of the first phase of the Project is scheduled for 2015.
A good deal of uncertainty still surrounds the components of the Project’s second phase, as well as its timing. TJPA documents indicate a start date of 2012 and completion in 2018. However, further delays are possible as all funding is not in place and major programming issues remain open. The California High Speed Rail Authority has yet to formally designate the Transit Center as its station in San Francisco. At least two other sites remain in the running: the existing 4th and King CalTrain Station and another on Beale Street, just a block west of the Transit Center. The High Speed Rail Authority will be releasing a study of these alternatives tomorrow.
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