THE PROPOSED EXTENSION of BART train service into San Jose and the city of Santa Clara could be anything from a risky endeavor to a complete boondoggle, according to a new Santa Clara County Civil Grand Jury report on the BART Silicon Valley Phase II project.
The report, simply titled “VTA’s Management and Oversight of BART Silicon Valley Phase II,” was released Wednesday and excoriates the Santa Clara Valley Transportation Authority’s handling of what, if completed, will be the agency’s most costly project ever undertaken, according to the grand jury.
In addition to murky cost projections, the grand jury concluded that the complicated project’s oversight committee needs more oversight and has been ineffectual.
California’s civil grand jury system provides independent investigations into issues in counties. In Santa Clara County, the 2025-2026 jury wanted to examine the uncertainties and miscommunication between stakeholders surrounding the BART Phase II project.
Grand jury members were given special access to officials with BART, the VTA, and the state, as well as being able to request documents to review. The grand jury also combed through every meeting of the Phase II Oversight Committee.
Cost concerns mount
The project would add four stations and extend BART 6 miles through downtown San Jose into the city of Santa Clara, expanding out from the Berryessa station in North San Jose. At a cost of $12.7 billion, according to the most recent projections, it will take at least 10 years to finish.
The project’s positives would be providing more BART access to the Bay Area’s largest city, San Jose, and creating another commuter corridor. But the project also has several things going against it, according to the grand jury, not the least of which is the dire fiscal state of local transit agencies, all of which are counting on voters to approve the Connect Bay Area Act tax measure in November to generate essential funding.
If the ballot measure doesn’t pass, agencies such as BART have created contingency plans that include shutting down stations.
The BART Silicon Valley Phase II project was preceded by Phase I, which was completed in 2020 and added the Milpitas and Berryessa stations and has so far taken a big financial hit, with annual losses of $69 million in the first five years of operation. According to the grand jury, ridership for the Phase I project was 86% below estimates for January 2026.
Amid all this, the jury found that VTA has moved full-bore, pun intended, and awarded major construction contracts for Phase II, and the agency even purchased its own boring machine to build the BART tunnel. And more costs are coming.
“Over the next few years, VTA anticipates awarding further construction contracts worth billions of dollars,” the jury wrote.
Two sales taxes were passed by voters to fund the Phase II project and operate it. If another one qualifies for the November ballot, that will be an additional half-cent sales tax, bringing the county sales tax up to 10.25%. With that in mind, there is no guarantee another sales tax ballot measure will be approved by voters this time, according to the grand jury.
Other funding will depend on state and federal grants. VTA wanted a federal commitment of $6.3 billion, but the Federal Transportation Administration is capping any contribution at $5.1 billion.
In short, none of the projected funding is guaranteed.
“All the funding sources are subject to risks,” reads the jury’s findings.
Once the project is up and running for commuters, the unknowns will persist. According to VTA records reviewed by the jury, for the first three years of operation, VTA forecasts annual average costs of the Phase II BART extension to be $274 million for operations, maintenance and capital costs. Average annual fare revenue is projected at $60 million, resulting in an average annual financial loss of $214 million, the report states.
“Any drop in ridership will lead to further financial losses,” the jury wrote.
Questions over VTA leadership
Ultimately the grand jury report honed in on the role of the VTA Board of Directors, its Oversight Committee and the oversight of the Phase II project, none of which fare too well in their assessment.
The role of the Oversight Committee is to help the board establish a direction and recommended actions to keep the project on track. It should also ensure that VTA staff is accountable for following the board’s direction.
The jury goes into detail about how the Oversight Committee communicates — or fails to communicate — with the VTA Board and vice-versa, characterizing the interactions as “informal, intermittent and often late.”
“The Oversight Committee endorsed a major contract change without providing independent analysis, articulating its rationale, or conveying identified risks to the Board,” the jury found.
The grand jury also found that the VTA failed to adequately assess other financial risks and frankly was not prepared to take on such a huge, complex infrastructure project.
“Sources repeatedly raised concerns about the level of knowledge and decision-making ability of the full VTA Board,” the report reads.
The board is made of appointed seats held by elected officials that run in two-year commitments, effectively erasing institutional knowledge with each reshuffle. Currently the committee is chaired by San Jose Mayor Matt Mahan.
The jury also found that the Oversight Committee does not make recommendations to the VTA board when it should and does not adequately share reports of valuable information it has received from VTA staff, experts, the public, the auditor general and the project management oversight consultant. The committee also does not hold VTA staff accountable for missing deadlines to provide analysis and information.
Recommendations for reform
As for recommendations, the jury had 10.
First, a strategy should be created to reduce the project’s dependency on any transit funding measures passing in order to get cash and other funding strategies should be explored. A cash-flow model should be developed by the VTA general manager that is presented quarterly to the Oversight Committee and the Board.
Also, the board should increase its term seats to four years instead of two and should appoint people with transportation qualifications.
Finally, VTA should formally adopt a revised charter for the Oversight Committee that defines the role of the auditor general, outlines the committee’s responsibilities and need for regular reports regarding costs, risks, schedules and recommendations, and holding people responsible for timely reports and analyses.
The board is required to respond to the civil grand jury’s report, along with the city councils of most Santa Clara County communities and the county Board of Supervisors.
