Past BART Director: Ridership losses not (all) to blame for monstrous BART deficits
Image by Austin Cross
Financial expert and recently retired BART Director Debora Allen explains that increased ridership can’t save the agency's budget if its expenses continue skyrocketing year to year. (Here’s a two-word hint: Labor overtime.) From the SF Briones Society podcast.
Debora Allen: The rider experience was awful [in 2017, when I was first elected] … and it actually got worse before it got better in, really, the last year … but a lot of things had to happen. New fare gates, new trains, and a real renewed focus on that customer experience: the cleanliness, the on-time arrivals (they’re still working on that part). …
But the real important issue that everyone is talking about now, and you'll see this in the news a lot: is it fiscally sustainable? …
People are really liking the [rider experience] now, but the ridership has only returned to about little over 40% of pre-pandemic, so it's created a huge fiscal problem.
They're coming back to the taxpayers in 2026 to ask taxpayers to fund what they project is going to be about a $370 million annual operating deficit. Okay? This is just to operate the system, and does not include all of the infrastructure costs that are a completely separate matter. So in a nutshell, that's what's going on at BART.
JD: So it sounds fair to say that that fiscal gap is probably the biggest challenge facing BART right now? … Would that be closed if we brought ridership back to pre-pandemic levels? …
DA: That's a good question. I don't think it would, because of the amount of increases in operating spending that have gone on really, since the pandemic, since 2020. … [T]he ridership revenue goes [down], and the operating expenses go [up], and the recovery of that ridership revenue has really been just slightly higher than L-shaped—whereas back in 2020, … [w]e had international experts being hired by BART saying, “Oh, don't worry about it. It'll be a V shaped recovery. We'll be back to normal in no time, right?” (2:52–5:45)
JD: [A study that was commissioned in 2022] talked about how BART could achieve long-term fiscal solvency. Even if ridership returned to pre-pandemic levels, that probably wouldn’t be sufficient, as you just said. What would have to happen is a pretty significant reduction in service, closing stations, running trains on the hour instead of every 20 minutes or half an hour, shutting down some lines.
And when you initially read that, or when I initially read that, I was like, “Wow, this is shocking. This is a pretty significant reduction in what the Bay Area considers to be a crown jewel of our transportation system.” And then I thought about it a little bit more … and thought, “Well, if you think about BART as a business … when a business is putting out a product that customers say that they no longer need—
DA: Exactly.
JD: —it starts to reduce the market in that business, or it starts to reduce its share in the market in that business …” (6:21–7:19)
DA: And also … [r]ight now, today, the BART system is running far more train revenue hours than it did in 2019.
JD: Explain what that term is.
DA: [In transit,] they will quantify fare revenues per train hour. So you’ve got 60 trains on a system—I'm just throwing out numbers—if you have 60 trains running, you're going to have 60 hours of train revenue hours per hour, right?
And then there's a cost to that per revenue hour. … something like $18,000 per hour, if you're running 60 trains, is the amount by which the fare revenue does not cover the expenses. So basically the net deficit is $18,000 per hour. … [T]hat is a far greater number per hour of net deficit than ever before. (7:43–8:58)
JD: So the problem really is about these rising costs year over year that have made it fiscally unsustainable?
DA: It’s a combination of rising costs year after year combined with the ridership revenue that is now sitting at 42%. (16:34–16:51) …
So where does that spending go in the operating side? 75ish% of that is labor. So it would really make sense that you can't make much of a dent in this budget if you don't address labor: labor efficiencies, labor contracts, overtime, what we call “work rules.” … You know what an exempt employee is? It's a person exempt from overtime in California state law; but at BART, exempt employees get overtime. …
You would have to really carve a long list of … inefficiencies: management cuts, overtime cuts, operational efficiencies. And I have often written opinion pieces about this, that it's going to take a strong [and independent] management team to come in and really analyze … how this thing operates and how it could be carved back.
It's really very similar to what's going on in the federal government right now. Though I really don't advocate for taking chainsaws to things—that's kind of not my style—but the same thing that's going on the DOGE teams and the federal government, that is absolutely what needs to go on at BART. (13:27–15:09)
Listen to the whole thing here.
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