Metro briefs county committee on growing reserve shortfall; options include fares, partner funding and a transportation-district measure

King County Metro officials on Aug. 27 briefed the Budget and Fiscal Management Committee on a multi-year financial gap that could reduce reserves and complicate planned service and capital investments unless revenues and costs are realigned. Metro staff framed the shortfall as the result of rising operating and capital costs, flat sales-tax collections through recent forecasts, and federal funding uncertainty.

Jeannie Miller, assistant general manager for finance and administration at Metro, summarized the committee-directed briefing and said the presentation was intended to help the council and the public understand choices ahead of the 2026–2027 biennial budget transmittal. Geoff Keiser, Metro’s director of budget and financial planning, told the committee Metro’s 2025 budget assumes about $1.8 billion in total spending, with approximately $850 million coming from Metro’s dedicated 0.9 percent sales tax. Keiser said Metro currently plans to use some fund balance to meet 2025 spending but that, under the 2025 financial plan, the agency faces a projected shortfall of about $830 million by the 2028–2029 biennium against the reserves and designations Metro uses to manage risk.

Why it matters: Metro operates a roughly $2 billion annual budget and provides the region’s primary bus and transit service. A multi-year gap could affect whether Metro can restore suspended bus service, convert its fleet to zero-emission vehicles on the currently expected schedule, and deliver planned RapidRide expansions.

Policy commitments and pressures: Keiser said three policy commitments embedded in the 2025 plan drive capital and operating costs: the 2035 target to fully convert the bus fleet to zero emissions, restoring over 400,000 suspended revenue hours between 2025 and 2028, and continued RapidRide corridor investments (I, J, K and R lines). Keiser outlined possible revenue and cost levers: increase fares (the committee was told an adult fare increase from $2.75 to $3 will take effect in about a week), seek additional jurisdictional partner support, pursue a King County Transportation District funding measure, and identify internal cost reductions and capital-delivery efficiencies.

Federal and forecast considerations: Staff said the July 2025 OIFA forecast and the state sales-tax base expansion (state legislation that broadened the sales tax to some services) could materially change near-term revenue projections; Keiser said the July forecast adds about $50 million per year starting in 2026 and that additional sales-tax-base effects could total roughly $100 million in the near term. Staff also warned of ongoing federal-grant uncertainty and potential new FTA conditions under litigation.

No committee action requested: The briefing was preparatory; Metro will transmit a more detailed 2026–2027 budget and financial plan to the council in the coming month. Council members asked for more analysis on how much of the projected shortfall would be mitigated by scaling back the three policy commitments and discussed options such as using debt for large capital projects to smooth near-term costs.

Ending: Metro officials said they are working with cities, Sound Transit and other partners on capital delivery and revenue options, and staff emphasized the council’s upcoming role in weighing funding choices when the 2026–2027 budget is transmitted.