TO: AC Transit Board of Directors
FROM: Salvador Llamas, General Manager/Chief Executive Officer
SUBJECT: Proposed Contingency Service Plan
ACTION ITEM
AGENDA PLANNING REQUEST: ?
RECOMMENDED ACTION(S):
Title
Consider approving the proposed Contingency Service Plan for consideration at a future public hearing.
Staff Contact:
Ramakrishna Pochiraju, Executive Director of Planning & Engineering
Body
STRATEGIC IMPORTANCE:
Goal - Financial Stability and Resiliency
Initiative - Financial Efficiency and Revenue Maximization
This report provides a proposed Contingency Service Plan that, with Board approval of a future final draft, could be implemented in June 2027 if the regional revenue measure does not qualify for the ballot and pass in November. This plan, and the framework on which it is built, directly correlate with the District's service quality and financial efficiency strategic goals.
BUDGETARY/FISCAL IMPACT:
The District is projecting annual deficits averaging $50 million beginning in FY 2027-28 and continuing in subsequent years. To address the FY 2026-27 shortfall and maintain current service levels, the District will receive an operating loan from the State. However, starting in FY 2027-28, new revenue sources will be required to sustain operations. If new revenues are not secured, the District will be forced to reduce expenses to align with available funding.
Based on the District's most recent projections, staff has prepared a proposed Contingency Service Plan that contains reductions totaling $53 million. Under this plan, service would be reduced by 16.4%. Staff will be prepared to scale back the proposed service cuts if additional resources are identified.
BACKGROUND/RATIONALE:
Overview of Proposed Contingency Service Plan
At the March 25, 2026, meeting, the AC Transit Board of Directors approved an Alternate Service Plan Framework based on the recently updated Board Policy 545 (Service Standards). The framework, detailed in St...
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