BART Plan Clears Way for Projects

New plan brings train and restores previously cut tasks in South
County
Gilroy – The Santa Clara Valley Transportation Authority released a new financial plan Tuesday that would bring myriad transit improvements to South County and the first BART trains to San Jose by 2016.

The new plan is fueled by a rise in projected sales tax revenue that would add about $2 billion to VTA coffers over 30 years. The plan, which restores a number of projects that recent plans delayed or cut, is a dramatic departure from recent VTA financial scenarios that divided the agency over how to appeal to voters to approve a new sales tax to fund the plan.

In addition to extending BART from Fremont to San Jose in 11 years, the new plan allows for 10 Caltrain round trips to Gilroy by 2010, more than $800 million for a new road repair program and senior transit services, a people mover to the Mineta San Jose International by 2018, and $500 million in the bank when all projects are finished, assuming county voters approve a quarter-cent sales tax next November.

“It’s excellent news, it looks very encouraging,” said Morgan Hill Mayor Dennis Kennedy, who also sits on the VTA board. “However, we need to be very cautious because it looks too good to be true, and when something looks too good to be true, it often is.”

The plan is based on assumptions that county sales tax revenues will grow by as much as 6 percent a year between 2008 and 2015, compared to projections of 2.9 percent in the fiscal year ending June 2006 and 4.5 percent for the year ending June 2007.

The projections are higher, on a percentage basis, than the assumptions used to craft the first BART tax, the half-cent Measure A tax that passed in 2000. Measure A promised voters BART and a handful of other projects, but proved inadequate when Silicon Valley’s economy imploded in 2001.

“Everything looked so rosy and then the bottom fell out and there’s no guarantee that won’t happen again,” Kennedy said. “Sales tax revenue is typically very volatile and rises and falls with the economy.”

The projections are based on a forecast by the Center for Continuing Study of the California Economy in Palo Alto. VTA construction chief Jack Collins called his agency’s assumptions conservative when compared to the 7 percent growth forecast by the CCSCE.

“This is something of a work of art, we split the difference between the high and the low,” Collins said, noting that for the three months beginning July 1, the VTA grossed about $2 million more in sales tax revenue than the $37.4 million it had projected. “There is a risk, but we’re seeing the first signs that the economy is starting to recover and it’s showing up in the VTA’s sales tax collection.”

The VTA revises it revenue projections annually, but this latest plan comes at a particularly critical time.

In February, the VTA board of directors will consider whether to put a quarter-cent sales tax measure on the November 2006 ballot. Recently, several directors, including Santa Clara County Supervisor Don Gage, threatened to withhold support for the new tax unless it would be used for increased road and transit services in South County, including Caltrain, which was one of the lowest priority projects in previous spending plans.

Tuesday, Gage said he is optimistic that the VTA can now deliver the projects South County needs.

“I’m supportive of the plan as long as we get everything we need in South County,” he said. I’m willing to live with the schedule. The only thing is [other board members] may get greedy and say we want more, but I don’t think they will.”

VTA spokeswoman Jayme Kunz said concerns about fluctuating tax revenue are well-founded, but pointed to the VTA’s Measure B program, which has completed 18 out of 21 projects promised by the 1996 sales tax ballot measure, as proof that the agency can ride out economic downturns. The VTA is currently making improvements on Highway 152 as part of that program.

“In nine years, VTA has successfully completed the majority of Measure B projects,” Kunz said. “The program has provided millions of dollars in transportation improvements for the county.”

Plan Highlights

– BART phased in between 2016 and 2025

– Three new light rail lines in San Jose

– 10 Caltrain roundtrips to Gilroy by 2010

– Caltrain electrification/environmental improvements by 2018

– Airport people mover by 2018

– $717 million for road improvements

– Overall service increase of $12.4 percent by 2015; 24 percent by 2020

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