The San Francisco Municipal Transportation Agency Board of Directors unanimously approved the agency’s operating and capital budgets for fiscal years 2026-2027 and 2027-2028 this week, a move that includes cutting vacant positions, raising parking fees, and increasing cable car fares.

The SFMTA board on Tuesday approved a two-year operation budget totaling more than $3.1 billion and a capital projects budget of $1.2 billion, with each plan hinging on the passage of two local tax measures that would generate new sources of income.

The approved budget will close a $307 million deficit in the agency’s first year, starting July 1, by using a $200 million loan from the state of California and a mix of cuts to operating expenses and increasing fines.

Unpaid parking citation late penalties will increase by 10%. Parking meters across the city will rise by 25 cents per hour in fiscal year 2027-2028. Credit card fees will be passed on to the customer, no longer covered by the SFMTA.

The agency plans to introduce fare capping, where a rider who pays for two rides will then receive unlimited rides for the rest of the day. Additionally, the city will reduce fines for select infractions, including instances when people do not turn their wheels in the right direction when parked on hills. 

At the meeting, Director Steve Heminger pushed staff members to continue looking for places to make the agency more efficient.

“The budget is balanced only because we’re on the edge of a fiscal cliff,” Heminger said. “But the cliff isn’t gone. It’s lurking over there.”

The SFMTA plans to use revenue from two proposed measures on the November ballot — a regional sales tax and a San Francisco parcel tax — to close the deficit. If approved, they are estimated to annually generate $155 million and $166 million, respectively, for the agency.

San Francisco Mayor Daniel Lurie kicks off a campaign in Mission Dolores Park in San Francisco, Calif., on Tuesday, March 3, 2026, to gather signatures to qualify a ballot measure for the November election. The “Stronger Muni For All” measure would raise property taxes through 2042 and dedicate the money to Muni. (Thomas Hughes/Bay City News)

The initiatives come after COVID-19 pandemic-era federal funds are set to expire this summer, leaving the SFMTA and other transit agencies scrambling to find new sources of revenue to continue operations.

Without new revenue from the proposed sales tax measures, Muni is at risk of cutting service times, eliminating cable car lines, and canceling lines that run through redundant and less-used corridors.