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San Diego – The San Diego Metropolitan Transit System (MTS) Board of Directors today approved a $473.1 million operating budget for Fiscal Year 2026. The newly approved budget fully funds current service levels on all four Trolley lines and 92 bus routes, reaffirming the agency’s commitment to riders in the new fiscal year. The approved budget ensures the 15-minute Trolley frequencies enacted in January 2025 remain in place.
“This year’s budget demonstrates our dedication to delivering dependable, affordable transit while planning for future needs,” said Stephen Whitburn, MTS Board Chair and San Diego City Councilmember. “Through strong collaboration, we’ve approved a balanced budget that meets the needs of today’s riders and lays the groundwork for a more sustainable transit system.”
The FY 2026 total budgeted revenue is projected at $473.1 million, and total expenses are projected at $473.1 million, resulting in a balanced budget for FY 2026. This was achieved through short-term solutions as the agency prioritizes long-term financial sustainability in the face of a structural deficit. The full budget can be viewed on the May 15 Board of Directors Agenda (Item 20, p. 731).
At the same meeting, the MTS Board approved a contract with San Diego County-based transportation consulting firm Transportation Management & Design, Inc. (TMD) to conduct a Comprehensive Operational Analysis (COA). The COA process will be a thorough evaluation of the bus and Trolley system and lead to recommendations for changes in routes, additions or deletions of services, and overall improvements to enhance service efficiency and effectiveness.
TMD and MTS staff will analyze two scenarios over the next 18 months: (1) transit service expansion if new funding sources are found, and (2) service reductions if no new funding sources are found.
While the current budget is balanced, MTS is expecting a budget deficit of more than $120 million beginning in FY 2029. Conducting a COA now is a strategic, forward-thinking action to address it within that time frame.
In addition to the operating budget, MTS also has a $163.3 million Capital Improvement Program for FY 2026 to modernize the MTS system, enhancing safety, infrastructure, and facility improvements. In FY 2026, the program will fund 40 projects including bus and rail state of good repair initiatives, station upgrades, and more.
MTS reallocated $25 million in non-critical capital funds to support operations in FY 2026, with additional reallocations anticipated in FY 2027 and FY 2028. The FY 2026 operating budget includes usage of $62 million in operating deficit reserves, excess stimulus funds that were drawn in prior years based on eligible expenses and saved specifically for balancing future operating budget deficits.
About MTS
The Metropolitan Transit System (MTS) operates 92 bus routes and four Trolley lines in 10 cities and unincorporated areas of San Diego. MTS is a leader in advancing initiatives to create a greener, cleaner and better-connected transit system in San Diego. Each weekday more than 238,000 passenger trips are taken throughout the MTS system taking people to work, school, health appointments and other essential trips. In FY 2024, MTS served more than 75 million riders. For service schedule updates, news, alerts and more information on how you can use public transportation, go to www.sdmts.com.
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