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AC Transit warns of $200 million shortfall and outlines contingency plan that could cut service
Summary
AC Transit told Berkeley City Council it faces a projected $200 million deficit over four years and a potential 16% service reduction without new long‑term revenue, outlined a contingency service plan focused on protecting core routes, and urged Bay Area voters and local institutions to engage with an SB 63 funding measure.
AC Transit officials briefed the Berkeley City Council on July 7 about a looming multi‑year funding gap that the agency says could force deep service cuts and layoffs without a permanent revenue solution. "We're facing a looming service, workforce, and community crisis," said Stephen Jones, director of legislative affairs and community relations at AC Transit, during a presentation on the transit district's budget and contingency options.
Why it matters: AC Transit serves 13 cities and eight unincorporated communities across Alameda and Contra Costa counties and reports more than 40 million rides a year. Three out of four riders are people of color and nearly two‑thirds are low income, officials said, meaning service reductions would disproportionately affect transit‑dependent residents.
The numbers: Agency presenters said February–April ridership growth has returned but that federal pandemic relief has phased out, regional sales‑tax revenue has flattened and fare revenue growth has slowed. AC Transit projects a roughly $200 million deficit over the next four years—about a $50 million annual shortfall beginning in 2027—driven by rising fuel (up 28%), parts (up 14%) and vehicle costs (new bus prices up about 35%). Staff said the district has tightened spending and used one‑time measures to balance the current year budget, and that a $55 million state bridge loan closes the immediate gap but does not solve the longer‑term shortfall.
Contingency plan: Robert Del Rosario, AC Transit’s director of service development and planning, described a worst‑case contingency designed to protect the agency’s re‑aligned network and preserve frequent service on the busiest corridors. Under the plan, more than 90% of the bus network would remain intact; reductions would be targeted to low‑ridership segments and would prioritize reducing frequency before eliminating routes. Transbay and low‑ridership overnight lines would see the largest cuts in the scenario that takes effect if no long‑term revenue is secured by December 2026. "Plan for the worst and hope for the best," Del Rosario said.
Long‑term funding options: AC Transit emphasized the role of the proposed regional Connect Bay Area measure (SB 63), which would ask voters in five Bay Area counties to approve a 14‑year, half‑cent sales tax. Staff estimated the measure could generate about $980 million annually for regional transit; AC Transit would receive an estimated $52 million per year under that scenario.
What council asked: Berkeley officials asked about outreach to local colleges and universities and about how the contingency plan protects vulnerable riders and essential trips. AC Transit asked the public to submit feedback on a public survey and indicated plans to schedule public hearings this summer and fall before a board decision.
Next steps: AC Transit said the board will set a public hearing in August and hold a hearing in October; staff warned the board may need to implement contingency service changes by June 2027 if no durable revenue emerges. Council members encouraged the agency to coordinate outreach with UC Berkeley and Berkeley City College and to share briefing material with the city.
—Reporting for this item: Stephen Jones and Robert Del Rosario presented the figures and plan; key quotes and details are drawn from their staff presentation to council.
