SMART Proposes $89M Draft Budget for Upcoming Fiscal Year
On May 15, Sonoma-Marin Area Rail Transit plans to propose an $89.6 million budget for the 2025-2026 financial year, which represents a 37% reduction primarily due to a decline in construction activities.
The revenues have decreased by 34% to $81.9 million due to the same cause, according to Heather McKillop, who serves as the chief financial officer. She mentioned that the organization undertook significant initiatives during the last year with backing from state grants.
The organization allocated approximately $54.8 million in state money for initiatives including the extension of three paths designated for cyclists and pedestrians, finishing the construction at the Petaluma North Station, and opening the upcoming Windsor station. Projected income from state grants for the coming financial year is around $12.9 million, which represents a decrease of $41 million compared to previous estimates.
McKillop stated, “We witnessed an astounding level of construction during the fiscal year 2025.” She added that the subsequent major investment would involve extending the railway to Healdsburg.
Once the staff is prepared for the construction, “we will bring this back to you so you can budget accordingly at that point,” according to McKillop.
A budget workshop took place on May 7, followed by the release of the draft budget on May 9.
The team noted that the anticipated income from the organization’s quarter-percent sales tax, set to conclude in 2029, is projected to decrease roughly 2% to approximately $48 million. This amount constitutes nearly two-thirds of their overall earnings. Staff mentioned they intend to develop a plan aimed at getting voters’ endorsement for extending this tax during the electoral period in 2026; however, current financial plans do not include allocations for such an initiative.
Even though construction activities have decreased this year, the agency’s focus within the budget continues to be on the same areas: increasing ridership, developing pathways, extending rail services, and improving freight operations.
The objective for ridership is to boost the daily average up to 5,000 passengers each day, aiming for a total of 1.21 million rides by the conclusion of the fiscal year 2025-2026. This represents a rise of 34% compared to what was targeted in the previous year.
Following the introduction of the youth and senior free-fare initiative last year, the organization revised its target to reach 1 million passengers by June 30. This program will now run for an additional year.
The district has carried more than 900,000 riders on its trains since July, averaging about 3,800 riders daily during the week.
Marin County Supervisor Eric Lucan, a member of the SMART board, said that if it wants to hit its ridership target, it needs to spend more on marketing.
As budgeted, the agency has estimated about $300,000 for communications; $42,000 for marketing and promotional items; and $75,000 for public relations.
“Once Windsor becomes operational and we extend free rides to young people and senior citizens, we’ll have an important story to share. We must figure out how to spread this message effectively if our aim is to reach 5,000 daily commuters,” Lucan stated. The opening of the Windsor station is anticipated for June.
EddyCummins, the general manager ofSMART, mentioned that his team will review potential actions regarding their marketing approach and aim to present updated plans during the upcomingdraft budget discussion set for theboardmeeting onWednesday.
Overall, the expenditures for administration, operation, maintenance and other efforts to support ridership are estimated at about $45.4 million.
About $9 million is budgeted for maintenance and repairs of paths, designing new extensions and constructing three segments, including two in Santa Rosa and one in Novato.
The agency is keeping an eye on federal funding. The budget estimates about $11.2 million in revenue from various federal sources.
“There’s some uncertainty with federal funds right now, so I think the board needs to be aware of that,” McKillop said.
The finances might influence the $1.1 million trail development between Hanna Ranch and Vintage Way, along with upkeep and restoration initiatives.
Cummins stated that staff members are advocating to secure the funding the agency has long been entitled to.
He expressed his confidence that they will manage to accomplish all their goals.
In regard to funding rail expansions, the proposed plan anticipates approximately $11.4 million. This sum encompasses around $236,000 allocated for developing the project from Windsor to Healdsburg and roughly $2.5 million designated for designing purposes. Around $1.5 million has been earmarked for constructing a solar panel installation at the newly established Petulma North Station. Most of the remaining expenses within this section pertain primarily to administrative fees.
According to the draft plan, the agency is allocating $30.4 million for salaries and benefits, $16.9 million for debt service, and $18.2 million for services and supplies.
The agency is using $7.7 million from its unassigned fund because expenditures surpass revenues, which will leave a remaining balance of $53.8 million. According to McKillop, this fund was projected to be depleted by the conclusion of the 2029 fiscal year.
She mentioned that the organization will keep aside approximately 25 percent of the budget as a reserve fund.
Mike Arnold, a resident of Novato who spearheaded the opposition to a defeated tax renewal initiative in 2020, mentioned that he is closely monitoring farebox revenues.
He mentioned that the budget presentation did not include the fact that only 5% of SMART’s operational expenses are covered by passengers who pay fares,” Arnold said. He believes this situation negatively impacts lower-income taxpayers, who might be covering fares or contributing through sales taxes without utilizing the service.
The budget likewise projects a balanced cargo budget with estimated spending and income totaling $2.57 million.
Comments from the public can be submitted until June 2. A budget discussion is scheduled during the board’s meeting on June 18. Additional details are available at
sonomamarintrain.org
.
Originally Posted: May 15, 2025 at 4:06 PM PST
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