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SF
Prop L
Transportation Tax
Tax Ordinance
Sales Tax for Transportation Projects

Continues the existing half-cent sales tax to fund transportation improvements without increasing the current tax rate.

Vote YES

Jump to SPUR’s Recommendation

Note: SPUR is a co-sponsor of Prop. L.

What the Measure Would Do

Proposition L would extend the existing half-cent sales tax for transportation for 30 years and approve a new 2022 Transportation Expenditure Plan for transportation projects and programs. The measure[1] and Expenditure Plan would include funding for:

  • Neighborhood-level investments such as crosswalks, traffic calming, new and upgraded traffic signals, bicycle lanes and Safe Routes to School programs
  • Citywide improvements like electrifying Muni’s bus fleet, establishing transit signal priority, maintaining buses and trains so they operate safely and reliably, and increasing rider capacity on both Muni and BART
  • Implementing improvements identified in community-based plans across the city and particularly in equity priority communities[2] and other underserved areas
  • Major projects such as the Downtown Caltrain Extension, which will bring Caltrain to the Salesforce Transit Center


expenditures by category
Source: San Francisco County Transportation Authority 2022 Transportation Expenditure Plan
Click image to zoom.

 

The Backstory

In 2003, San Francisco voters approved Prop. K, a half-cent sales tax for transportation and a Transportation Expenditure Plan to guide how Prop. K revenues were spent. Prop. K has generated about $100 million annually for transportation improvements. The San Francisco County Transportation Authority, which administers the half-cent sales tax program, has sponsored Prop. L to continue the tax, approve a new 30-year investment plan and generate a local match to compete for additional federal funding. Federal government grants for capital projects require local funding contributions. The transportation authority estimates that every dollar of sales tax invested in San Francisco leverages four to seven times that amount in federal, state and other funds.

The half-cent sales tax has funded critical investments — including the purchase of new light-rail vehicles and Muni buses, BART station improvements, paratransit services, the Better Market Street project, Caltrain maintenance and neighborhood improvements such as crosswalks, sidewalk repairs and bicycle safety projects — especially in equity priority communities and other underserved neighborhoods. All but one of the projects funded in the 2003 expenditure plan have been completed or are underway, and some city-run programs will need new funding to continue. Through extensive stakeholder engagement, the City of San Francisco has identified new transportation priorities, which this measure would fund.

Prop. L was put onto the ballot by a unanimous vote of the Board of Supervisors and requires approval by a two-thirds majority of voters to pass.

Equity Impacts

Local funding sources like sales taxes are a crucial funding source for local governments, which have few tools for raising revenue needed to pay for public goods. Nonetheless, sales taxes are a regressive funding source. An advisory committee for the measure has recommended an expenditure plan that would help advance equity and mitigate the regressiveness of the tax, particularly by investing most of the revenue in transit, which would disproportionately benefit low-income San Franciscans.

Prop. L would increase the funding for paratransit and street safety projects, many of which are located in equity priority communities. The San Francisco County Transportation Authority also has implemented several policies to address equity:

  • Facilitating transparency and accountability in governance and administration, including reviewing all funding items with the community advisory committee prior to consideration by the 11 members of the San Francisco Board of Supervisors, who sit as the Transportation Authority Board.
  • Engaging early with the public, including low-income communities and communities of color, in shaping the new Transportation Expenditure Plan.
  • Using the Racial Equity Toolkit created by the Government Alliance on Race & Equity to analyze how Prop. K funds were spent and to ensure that the expenditure plan for Prop. L would invest funds equitably. This includes a thorough assessment of city data broken out by demographic indicators, as well as a reflection on how the 2003 measure advanced equity and where it fell short.  

Pros

  • Prop. L would provide essential funding for the maintenance and rehabilitation of existing transit infrastructure, which is essential to the city’s recovery from the pandemic. The federal government is providing COVID-19 relief funds to keep the transit systems moving, but these will be depleted by 2025, and there is no other source of funding currently available for these necessary improvements and upgrades.
  • The majority of funds generated would be used to maintain existing infrastructure and transit service and to improve street safety, maximizing benefits for low-income people. These investments could also help save money in the future, as neglecting maintenance ultimately costs more over time.
  • This measure would provide essential funding for capital infrastructure projects to improve the system. It would also make San Francisco’s projects more competitive for federal and state infrastructure funding.
  • The existing half-cent sales tax rate would not change, so Prop. L would deliver these benefits without increasing the overall tax rate that households pay.
  • Reauthorizing the sales tax before it expires would make it possible to issue bonds against 30 years of projected revenue. Without a renewal, it would be difficult to sell bonds backed by the remaining years of projected revenue on the 2003 measure.

Cons

  • Sales taxes are regressive, which disproportionately burdens lower-income people.
  • San Francisco does not have a great track record of completing big capital projects on time or on budget.

 

SPUR's Recommendation

SPUR supports taxation for the public good and believes that this measure balances concerns about the regressive revenue source with essential maintenance and improvements to meet the mobility needs of all San Francisco residents, especially people who are most in need and most at risk from traffic deaths, climate impacts and air pollution. Also, Prop. L represents a continuation of a tax, not a new tax.

Even though the City of San Francisco has challenges completing capital projects on time and on budget, most municipalities in this country face similar problems, and that is not enough of a reason to deny funding. Further, the SFCTA and the San Francisco Municipal Transportation Agency have been proactively and earnestly addressing these challenges for new projects in order to minimize the risk of cost increases and delays for future capital projects.

Most importantly, this funding is needed to maintain and improve transportation services, especially given lower revenues from fares as the pandemic continues. Without this funding, San Franciscans will experience lasting negative impacts to climate, equity, health and the economy. For instance, deferring maintenance means that sidewalks, streets and transit would be allowed to deteriorate, making it harder for the city to function. Without this tax, Muni, BART, Caltrain and other transit operators that would receive funding from Prop. L could be forced to make service cuts, leading to fewer riders and more congested roads.

Vote YES on Prop L - Transportation Tax
Footnotes

[1] San Francisco County Transportation Authority, “2022 Transportation Expenditure Plan,” https://www.sfcta.org/ExpenditurePlan (accessed on July 28, 2022).

[2] “Equity priority communities,” as defined by the Metropolitan Transportation Commission, are areas that are considered disadvantaged, with higher percentages of households of color, low-income households, seniors and people with limited English proficiency. See Metropolitan Transportation Commission, “Equity Priority Communities,” https://mtc.ca.gov/planning/transportation/access-equity-mobility/equity-priority-communities (accessed on July 29, 2022).