$73 million in Bay Area transit tolls diverted to bridges

About $73 million of the Bay Area bridge toll money that voters approved in 2018 for transit and highway improvement projects was instead diverted to pay for bridge maintenance.

It’s just one small example of how Metropolitan Transportation Commission officials have for years mixed up different parts of tolls for the region’s seven public bridges.

These troubling financial practices came to light when the agency asked our editorial page for support for its plan to once again raise tolls on Bay Area bridges.

The auto toll is expected to increase from $7 to $8 in early 2025. A commission committee overseeing bridge tolls is expected to vote next week and the full commission board the following week on a proposal to add another $2.50.

Currently, because of this mix, the commission does not have the data needed to intelligently evaluate toll increases. The plan should be put on hold until the agency’s finances are transparently reported.

Latest toll hike plan

The proposal calls for annual increases of 50 cents starting in 2026, which would bring the cost of an automobile trip to $10.50 by 2030. To understand if the increase is necessary, I asked to see financial monitoring of the different portions of the toll at the agency. collect now.

District officials responded that they were pooling the money rather than budgeting it separately. This is surprising and problematic, because the different components of the toll are intended for very different purposes.

The first dollar, approved by voters in 1988, went toward operating, maintaining and replacing bridges, as well as improving BART, Caltrain and the San Francisco Muni.

An additional $3 – approved in $1 increments by the Legislature in 1997 and 2007 and by the MTC in 2010 – was supposed to help cover the cost of seismic upgrades, including replacement of the eastern span of the Bay Bridge.

And voters in 2004 and 2018 approved toll increases totaling $4 to help fund transit service operations and highway, transit, bicycle and pedestrian projects, including modernization BART seismic, new railcars and station expansion in Warm Springs and San Jose; the fourth drilling of the Caldecott tunnel; and the eBART rail extension in eastern Contra Costa County.

Voter materials for the 2018 ballot proposition, Regional Measure 3, listed the projects but did not mention that the money would be used to maintain or rehabilitate the bridges. Indeed, backers emphasized at the time that the measure would fund projects outside the bridge to reduce congestion on it.

But apparently voters should have read the fine print of state law. Rebecca Long, the agency’s director of legislation and public affairs, and Derek Hansel, chief financial officer, insist the law allows them to use toll money for any maintenance, construction and improvement of the bridge.

Worse yet, none of the tolls’ components have an expiration date, but the list of projects they are intended to fund is limited. So Long and Hansel argue that there will ultimately be more money than projects, leaving them free to use the excess for bridging purposes.

Indeed, they claim, they are free to use the money from the different programs even before the promised projects are completed. The commission’s only obligation, they say, is to provide funding for projects at a given time.

$10 billion in debt

They also argue that toll revenues should be pooled because they serve as collateral for bond sales. This is a false justification for the lack of transparency.

Aggregating the numbers for the bond market is understandable. And it’s no different than what most government agencies do. But that’s no excuse for not tracking how borrowed money is spent on different programs.

The commission owns nearly $10 billion in bond debt. Not only does the agency fail to track how money is used by program, it also fails to allocate responsibility.

The result is that there is no way of knowing how much of each program’s financial obligations have been met, or when it will be.

As the commission considers further raising tolls – again permanently – for bridge operations, maintenance and rehabilitation, it should ask how much of the current toll money could be used now or in the future to offset the need for such a significant increase.

But to determine that, commissioners would need accounting and projections separating funding and spending for each of the bridge’s toll components.

To his credit, Hansel, who took over as CFO in 2022, says it would be “best practice” to track revenue and expenses for each program. He says he has the information to do so for Regional Measure 3. And he has told others it will take him a few months to figure out the other programs, which started well before he arrived.

The commissioners should insist that he complete this as quickly as possible to provide transparency to the public and ensure that the commissioners make an informed decision regarding another toll increase.

The proposed increase is not expected to begin until 2026, so there is no need to rush the plan. Until monitoring data is available, the bridge toll increase should be postponed.

Originally published: December 6, 2024 at 12:53 p.m. PST