Faced with looming budget deficits, Golden Gate Bridge district officials are considering a five-year toll increase plan — again.
The price to cross the bridge for many drivers ticked up 35 cents to $9.75 on July 1, the final increase in the five-year toll hike plan that started in 2019. However, toll revenues took a plunge when the COVID-19 pandemic kept commuters away, and many still have not returned.
While the district did receive $278 million in pandemic relief, those funds will be exhausted by the end of the fiscal year. On Thursday, officials reported an estimated $220 million shortfall over the next five years and a $679 million deficit over 10 years.
“Bridge tolls are by statute the backbone of the district’s revenue source,” said Jennifer Mennucci, the district’s budget director. “They fund both bridge operations and operations and maintenance of both bus and ferry, as well to fund reserves for our future capital needs in bridge and transit.”
Traditionally, about half of the toll revenue raised goes to fund transit. However, the effects of the pandemic are lingering, she said.
“We’re steadily trending at about 80%, 85% of pre-COVID traffic,” Mennucci said. “Commute hours are down almost 30%. This results in a drop of about $25 million to $30 million a year.”
Mennucci said that is equal to a reduction of about 25% of the bus and ferry system’s pre-COVID revenue.
Bridge tolls are the district’s largest source of revenue, making up about 46% of its revenue forecast for the upcoming fiscal year.
At present, the toll for two-axle vehicles is $9.75. Tolls for drivers with FasTrak are $8.75. For drivers who have a “pay-as-you-go” account, which includes drivers who register their license plates or set up a one-time payment through the district, tolls are $9.
For the fiscal year ending on June 30, toll revenue was about $146 million, said Joe Wire, the district’s auditor-controller.
That revenue is expected to remain flat over the next year, even with the 35-cent increase that took effect in July. That’s because violation policies have changed, and the district is projecting less revenue from infractions, Wire said.
The Golden Gate Bridge, Highway and Transportation District is set to receive $2.8 million from the state in the 2024-25 fiscal year. The district could also receive another $38.2 million the following year, but that allocation has not been finalized, Wire said.
“We’re not guaranteed that second year of funding,” Wire said. Regardless, it still isn’t enough to close the funding gap.
In order to show the magnitude of a potential new toll increase, district staff drafted figures based on a sampling of incremental raises, Wire said.
For example, raising tolls 25 cents for five years would raise an additional $76 million. A 35-cent raise would collect an extra $101 million over five years, and a 50-cent hike would net another $139 million.
“The board is not trying to solve the five-year financial shortfall solely from the tolls,” said Denis Mulligan, general manager of the bridge district. “It’s part of an array of solutions in the strategic plan.”
“If we adopt a toll increase, that solves half of our deficit,” Mulligan said. “The other half will be solved through other means, through efficiencies or through service reductions or other outside funding sources.”
Mennucci said the district has raised a little over $100 million extra over the past five-year hike.
Bridge district board member James Mastin said the annual inflation rate is about 4%, and on a $9.75 toll that would be about a 40-cent increase.
“To me that’s easily understandable, it’s defensible, it’s commensurate with the pain felt by everyone else, all of our customers,” Mastin said. “I would be reluctant to see us go above a 4% increase.”
The district is preparing options for proposed toll increases to be presented to the board and to the public next month.
If directed, staff will hold online forums in February to provide information, answer questions and receive public comments on the proposals.
A public hearing will be set for the end of February. The board would be expected to vote on the plan at a meeting in March. The first increase likely would take effect July 1.