The San Francisco Municipal Transportation Agency (SFMTA) is developing its two-year budget for Fiscal Years 2026-27 and 2027-28 amid what it describes as the largest budget deficit in its history.
The agency reports a projected shortfall of $307 million beginning July 2026, with the deficit expected to grow to $434 million by July 2030. SFMTA says this financial challenge is due to the pandemic’s impact on the city’s tax base and declining relief funding and other revenue sources. The agency warns that without new funding, dramatic changes to Muni service and programs may be necessary.
According to the SFMTA, proactive steps have been taken to address the gap, including internal cost savings, strategic service reductions, and transit priority upgrades. The Controller’s Office led a Muni Funding Working Group that gathered public input earlier than usual in the planning process. “Members overwhelmingly supported addressing the deficit through revenue-raising options. This feedback is informing our work to balance the budget,” SFMTA said.
The agency has reduced what would have been a $440 million deficit in FY 2026-27 down to $307 million through these measures but states that additional funding sources are still required. SFMTA notes ongoing collaboration with state partners and city officials to identify further solutions.
Community engagement remains part of the process, with Budget Open Houses scheduled for March at various locations and virtually. Survey results from community members were presented at an SFMTA Board Workshop in February and will also be shared at upcoming events.
SFMTA emphasizes that aligning resources with community priorities is central during this critical period of budget planning. More information will be provided as planning continues.
