HomeMy WebLinkAboutStaff Report 2606-6489CITY OF PALO ALTO
CITY COUNCIL
Special Meeting
Wednesday, September 09, 2026
Council Chambers & Hybrid
5:00 PM
Agenda Item
5.Approval of Response to Civil Grand Jury Report “VTA‘s Management and Oversight of
BART Silicon Valley Phase II”; CEQA Status: Not a Project
City Council
Staff Report
From: City Attorney
Report Type: CONSENT CALENDAR
Lead Department: City Attorney
Meeting Date: September 9, 2026
Report #:2606-6489
TITLE
Approval of Response to Civil Grand Jury Report “VTA‘s Management and Oversight of BART
Silicon Valley Phase II”; CEQA Status: Not a Project
RECOMMENDATION
Staff recommends that Council approve the following response to the 2025-2026 Santa Clara
County Civil Grand Jury Report entitled, “VTA’s Management and Oversight of BART Silicon
Valley Phase II”.
BACKGROUND
On June 17, 2026, the Civil Grand Jury of Santa Clara County released a report entitled “VTA‘s
Management and Oversight of BART Silicon Valley Phase II”(“BSVII”). The Grand Jury
investigated the role of the VTA Board, its Oversight Committee, its staff, and officials in the
management and oversight of the BSVII project for this report.
The only findings and recommendations relevant to the City of Palo Alto relate to the process
for appointing VTA Board members. VTA Board members are appointed to two-year terms by
appointing agencies, organized into six groups. Appointing agency groups are established and
defined by the VTA Administrative Code. The Administrative Code encourages, but does not
require, the agency groups to (1) appoint individuals with appropriate experience and
qualifications in transportation; (2) ensure that there is sufficient remaining time in the elected
official’s term of office to allow full completion of their term as a Director; and (3) reappoint
representatives to consecutive terms. (VTA Administrative Code, § 2-14.)
The City of Palo Alto is a member of Appointing Agency Group 2, along with the cities of Los
Altos, Los Altos Hills, and Mountain View. The Group 2 Bylaws (Attachment B, Exhibit 1) define
the process for appointing the Group 2 representative to the VTA Board and incorporate the
requirements of VTA Administrative Code section 2-14 into the appointment process, including
(1) minimum requirements for transportation-related experience and (2) a requirement that
any eligible sitting Board Member or alternate be appointed to a second term after serving
their first term.
A copy of the Grand Jury Report is included as Attachment A.
ANALYSIS
Summary of Findings and City Response:
Civil Grand Jury Finding 6: VTA Administrative Code
VTA Board Appointing Authority Groups 2 through 5 often do not follow VTA Administrative
Code (Section 2-14) admonitions to “appoint individuals with appropriate experience and
qualifications in transportation” and to “reappoint representatives to consecutive terms.”
recent Group 2 appointees to the VTA Board is provided in the City’s response to Finding No. 6.
No further report to the VTA Board is required.
of Palo Alto agrees with this finding. The VTA Administrative Code allows members of
VTA Board Groups 2 through 5 to determine the process for appointing their respective Board
members. The Administrative Code allows each group to have a different process. While Palo
Alto lacks first-hand knowledge of the appointment processes for Groups 3 through 5, publicly
available sources indicate that not all of the groups use the same process that Palo Alto and
other Group 2 cities use to appoint their VTA Board members.
FISCAL/RESOURCE IMPACT
STAKEHOLDER ENGAGEMENT
ENVIRONMENTAL REVIEW
ATTACHMENTS
APPROVED BY:
2025-2026 Santa Clara County Civil Grand Jury
VTA’s Management and Oversight of BART
Silicon Valley Phase II
June 17, 2026
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VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II
T ABLE OF CONTENTS
SUMMARY ................................................................................................................................... 2
BACKGROUND ........................................................................................................................... 3
METHODOLOGY ....................................................................................................................... 7
INVESTIGATION ........................................................................................................................ 8
Financial Risks .......................................................................................................................... 8
Oversight Concerns ................................................................................................................ 13
Coordination with BART ....................................................................................................... 21
Board Experience and Continuity ......................................................................................... 22
Public Communication ........................................................................................................... 25
CONCLUSION ........................................................................................................................... 26
FINDINGS AND RECOMMENDATIONS ............................................................................. 27
REQUIRED RESPONSES......................................................................................................... 31
APPENDIX A: BART Management Letter ............................................................................. 32
CONFLICTS ............................................................................................................................... 34
REFERENCES............................................................................................................................ 34
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VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II
SUMMARY
The Santa Clara Valley Transportation Authority (VTA) project to extend rapid transit rail service
through downtown San José is controversial and the most costly and complex project it has ever
undertaken. Known as BART Silicon Valley Phase II (BSVII), the $12.7 billion project extends
rail service six miles and includes a large, single-bore underground tunnel and will take 10 years
or more from 2026 to complete (VTA, March 2024).
Despite significantly reduced ridership projections and uncertainty about funding sources for both
capital and operating costs, VTA has awarded major construction contracts, including for the
construction of a launch structure to stage a specialized one-of-a-kind Tunnel Boring Machine
(TBM), which will be owned by VTA. Over the next few years, VTA anticipates awarding further
construction contracts worth billions of dollars. To reduce uncertainty, the spokesperson for an
independent peer review of the project urged VTA to move quickly to “build as much as you can,
as fast as you can” (VTA Special Board Meeting, 2025). Such an approach assumes that there will
be political will and taxpayer support to finish an incomplete project regardless of cost increases,
delays, or reduced ridership.
The VTA’s Board of Directors (Board) has recognized the need for additional oversight and
guidance, but the Board has failed to exercise its obligation to provide the strategic direction
needed for a successful project. The Oversight Committee it created has been left to define its own
role. It was not required to, and does not, provide reports that share available independent analyses
of critical issues. The Oversight Committee does not routinely make policy recommendations to
the Board and does not hold VTA staff accountable for providing the timely analysis it has
requested.
The 2025-26 Santa Clara County Civil Grand Jury (Civil Grand Jury) investigated the role of the
VTA Board, its Oversight Committee, its staff, and officials in the management and oversight of
the BSVII project.
This report identifies financial challenges, risks, and accountability issues that VTA must address
to earn the public’s trust in delivering the Bay Area Rapid Transit (BART) extension to Silicon
Valley and to secure support for future sales tax measures.
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VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II
BACKGROUND
The Valley Transportation Authority is a transportation agency established by state law. It is
responsible for operating public transit services, including buses, light rail, and paratransit within
Santa Clara County. In addition to public transit, VTA is a planning and funding agency for
transportation infrastructure projects throughout Santa Clara County. As established by the
California Public Utilities Code Sections 100060-100070, the VTA is governed by a 12-person
Board of Directors composed of elected officials appointed by the County of Santa Clara (County)
and the cities in Santa Clara County, who each serve two-year terms. The Board has many
responsibilities and its monthly meeting agendas are lengthy.
The San Francisco Bay Area Rapid Transit District provides regional commuter rail service and is
governed by a nine-person Board of Directors elected to four-year terms from districts representing
San Francisco, Alameda, and Contra Costa counties. As part of its larger regional system, BART
operates the commuter rail service within Santa Clara County.
By contract with BART, VTA is solely responsible for paying the capital and net operating costs
of extending commuter rail service into Santa Clara County (BART and VTA, Comprehensive
Agreement, 2001). Although the County was not included in the legislation establishing BART,
voters of Santa Clara County supported three sales tax measures which provided funds to plan,
build, and operate the extension of BART to Santa Clara County. Today, 1.625% of sales tax
collected in Santa Clara County supports VTA and other local jurisdictions (see Table 1). If a
currently proposed measure qualifies for the ballot, in November 2026, voters will decide whether
to approve an additional 0.5% sales tax to fund local transit, which would increase the County’s
base sales tax rate from the current 9.75% to 10.25%.
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VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II
Table 1: Countywide Sales Tax in Santa Clara County, Effective April 2026
Description Sales Tax % Expiration Funding Purpose
California Base 7.250% No Expiration
State General Fund
Local Revenue Fund
Local Public Safety
Health & Social Services
1976 Measure A 0.500% No Expiration Transit: VTA
2000 Measure A 0.500% 2036 Transit: VTA, BART Silicon
Valley
2008 Measure B 0.125% 2042 Transit: BART Silicon Valley
2016 Measure B 0.500% 2047
Transit: VTA +
County/City/Caltrain/Caltrans
Infrastructure
2012 Measure A 0.125% No Expiration County General Fund
2020 Measure RR 0.125% 2050 Transit: Caltrain
2026 Measure A 0.625% 2031 General incl. Healthcare
Total Base Sales Tax
Rate 9.750%
Data extracted from: California Department of Tax and Fee Administration. 2026.
(https://cdtfa.ca.gov/formspubs/cdtfa105.pdf); VTA Annual Comprehensive Financial Report.
Page 3-10. 2024. (https://www.vta.org/sites/default/files/2024-12/Annual-Comprehensive-
Financial-Report-ACRF-FY-2024.pdf).
Note: Some cities have higher voter-approved rates in addition to the County base rate;
Highlighted section of the table refers to sales tax measures that fund VTA.
The first phase of BART to Silicon Valley extended service to Milpitas and then to the Berryessa
Transit Center (Berryessa). Construction started in 2012 and was completed in 2020. Ridership for
Phase I has not met forecasts, and due to operational, maintenance, and depreciation expenses,
VTA has experienced significant financial losses. According to data reviewed by the Civil Grand
Jury, BART to Silicon Valley Phase I has lost an average of $69 million annually during the first
five years of operation.
The second phase consists of a six-mile, four-station extension from Berryessa through downtown
San José to the City of Santa Clara. For this phase, VTA is targeting completion by 2037. As a
condition of federal funding, the Federal Transit Administration (FTA) has appointed a Project
Management Oversight Consultant (PMOC). The PMOC uses a more conservative schedule and
forecasts completion in 2039 (AtkinsRéalis USA Holdings LLC, 2026).
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VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II
At an early planning stage in 2014, the BSVII project cost was estimated at $4.7 billion. By 2020,
the cost estimate increased to $6.9 billion. In 2022, based on the PMOC’s projected cost analysis,
VTA submitted an estimate of $9.1 billion to the federal government for an Early Start Grant. In
October 2023, VTA estimated the construction cost at $12.2 billion with operations to begin in
2036. The most recent estimate is $12.7 billion, and operations are pushed back to 2037 (VTA
Auditor General Report, January 2024).
The project's funding sources include federal and state grants, as well as local revenues from voter-
approved sales tax measures. All the funding sources are subject to risks, which are identified in
this report. Figure 1 shows the funding sources with $700 million to be determined (TBD) and
$375 million from a potential ballot measure in November 2026.
Figure 1: Components of $12.7 Billion in BSVII Funding Sources as of April 2026
Source: vtabart.org website (accessed April 9, 2026)
Although two years earlier, VTA had asked for a federal commitment of $6.3 billion, in August
2024, the FTA announced that its share of funding would be capped at $5.1 billion (Geha, 2024).
VTA was forced to increase its reliance on local sales tax revenue and still faced a gap of
approximately $700 million (VTA, Summer 2025). To reduce project costs, VTA has been
studying design changes while maintaining the full six-mile extension with four stations. Options
discussed by VTA staff and officials include (VTA, November 11, 2024):
• Simplifying station configurations;
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• Modifying the Santa Clara Newhall Yard and Maintenance Facility;
• Modifying the tunnel and station ventilation systems;
• Substituting a surface parking lot for a parking structure;
• Reconfiguring the tunnel to use less concrete and steel.
In addition, the funding strategy assumes $375 million from the yet-to-be-approved regional sales
tax measure for a total outstanding gap of $1.075 billion.
Due in part to the significant increase in estimated cost and a perceived lack of communication
about the project’s cost, risks, and schedule, the Board conducted a workshop in October 2023 to
review the project’s status. At this workshop, individual Board members expressed a lack of
confidence in the VTA staff’s management of the project and requested a new system of oversight
and project management.
In response, the Board chair established an Ad Hoc BART Silicon Valley Phase II oversight
committee (Oversight Committee) responsible for overseeing all aspects of the project, focusing
on a full, independent, and transparent review of costs, funding, risks, and completion schedule.
The Oversight Committee’s bylaws later stated that its purpose was to provide “guidance and
oversight” of the project (VTA, April 4, 2024).
The VTA independent auditor general was tasked with providing staff support to the Oversight
Committee and was authorized to contract with Subject Matter Experts (SMEs) to independently
review and comment on VTA staff recommendations regarding costs, risks, and schedule. In turn,
the Oversight Committee authorized the SME firm, Gall Zeidler (GZ), to independently assess the
risks and viability of cost-saving alternatives.
In a 2001 Agreement, VTA and BART agreed to cooperate in the project’s planning, design, and
construction. They established a series of interagency committees, the latest of which is the Joint
VTA/BART Working Committee, which depending on the availability of its members, is
scheduled to meet quarterly. BART staff members have been assigned to co-locate with VTA
engineers to participate in the preparation and review of BSVII designs in accordance with the
agreed Project Design Criteria Manual. According to the BART Inspector General, VTA has
reimbursed BART $19.2 million through 2025 for the cost of the assigned employees (BART,
December 19, 2025). In August 2025, the BART assistant general manager, operations, rejected
some of VTA’s proposed design changes and scope reductions and complained about inadequate
coordination (see Appendix A). The BART inspector general issued a report in December 2025
that also raised concerns about inadequate coordination and criticized VTA’s communication with
BART officials (Id.).
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VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II
METHODOLOGY
The Civil Grand Jury reviewed every meeting of the BSVII Oversight Committee, as well as select
VTA Board meetings. This included reviewing agendas, minutes, agenda item reports, public
comment submittals, and associated discussions.
In addition, the Civil Grand Jury conducted 17 interviews of officials from VTA, BART, and the
State of California. The Civil Grand Jury also reviewed publicly available documents as described
in the reference section, as well as documents requested from VTA and submitted to the Civil
Grand Jury.
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VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II
INVESTIGATION
The Civil Grand Jury investigation of the BSVII project covered critical aspects of VTA’s
management and oversight, including:
• VTA’s funding strategy and its reliance on voter-approved sales tax measures, some of
which expire before completion of the project, and some of which have yet to be approved;
• The establishment of a separate Oversight Committee which provides guidance on the
BSVII project and how it evaluates independent analyses provided by the VTA auditor
general, contracted SMEs, and the federally mandated PMOC;
• The contractual and practical requirement to closely coordinate with BART, which will
serve as the system operator;
• The impact of the VTA Board’s governance structure on the effectiveness of strategic
direction, management, and oversight of the project;
• VTA’s approach for keeping the public informed of costs, risks, and schedule.
Financial Risks
The 10-year project completion timeline of BSVII exposes VTA to financial risks that require
careful, ongoing assessment of capital and operating costs, including that:
• Rising labor and material costs, combined with aggressive construction methods and
schedules, may increase total project costs and strain the budget’s contingency for
unforeseen risks and unexpected expenses;
• Delays or reductions in state and federal funding will create greater pressure to rely on
local funding sources or scale back the scope of the project;
• Lower ridership levels will increase VTA’s ongoing obligation to pay net operating costs,
which would necessitate service level reductions or voter approval of new or extended sales
tax measures;
• Failure to maintain a cash-flow model exclusive to BSVII, means that contracting options
for accelerating work may not be able to be financed with available resources.
Risk of Increased Costs of Labor and Materials
The FTA fiscal year 2025 New Starts Financial Assessment report for BSVII stated the VTA
inflation estimate was optimistic. If labor and material costs were to rise above those estimated in
VTA’s budget, it could lead to funding shortfalls (FTA, 2024).
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The VTA auditor general’s May 1, 2025, report to the Board also identified BSVII financial risks
associated with project construction costs. The report found that the assumptions and historical
data underlying VTA’s financial plan could be more robust to enable the Board and the public to
evaluate the financial risk associated with the potential cost increases (VTA, 2025).
Another factor that increases the difficulty in predicting materials and labor costs is the possible
extension of the 2037 project completion date. The longer timeline for BSVII increases the
likelihood that future costs will differ from current estimates, thereby increasing financial risk.
Local, State, and Federal Funding Risks
The capital cost of construction and the net operating costs are to be paid by VTA from specific
revenue sources, some of which are grants with fixed amounts.
The financial risks identified by the Civil Grand Jury have been experienced by other major transit
agencies. For example, the various rail projects of the Los Angeles County Metropolitan
Transportation Authority (LA Metro) faced escalating cost estimates, reductions in federal
funding, cuts into smaller construction segments to match available funding, and shifting agency
priorities (Shalby, 2026).
Local Funding Risks
VTA’s capital financing plan calls for the 2016 Measure B to pay $2.5 billion and for the 2000
Measure A to pay $2.0 billion of the estimated $12.7 billion BSVII project. Measure A expires in
2036, before BSVII is expected to be completed. Measure B expires in 2047 (VTA, About 2016
Measure B, n.d.). As the project’s cost estimates have evolved, so have the planned funding
sources. Measure B has become a much more significant source of proposed funding.
Because Measure B also funds bus transit, local streets, and highway projects, there are built-in
limitations on the amount available to close a BSVII financing gap. Measure B limits spending on
BSVII to 23.8% of net sales tax revenue over its 30-year life (FTA, 2024). Net sales tax revenue
(defined as Program Tax Revenue in the measure) is calculated as the amount remaining after
deducting administrative costs and any debt service.
To close current and potential future funding gaps, VTA could issue bonds to be repaid from
Measure B sales tax revenue. However, this would reduce the revenue available for other voter-
approved projects. Every dollar spent on debt service for BSVII is a dollar that cannot be spent on
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the other transportation projects approved by the voters. Because of bond issuance and interest
costs, the total project costs would exceed the current estimate of $12.7 billion.
Another risky approach to filling funding gaps would allow the Board to change the rules and
permit a greater percentage of Measure B net sales tax revenue to be used for BSVII. One VTA
official acknowledged to the Civil Grand Jury that this would be a “heavy lift” because VTA would
first have to notify all the local agencies of the proposed increase in the percentage limit and then
approve it by a ¾ vote of the Board (9 of 12 Board members). The County and the cities that have
planned other transportation measures are likely to object to reduced funding for their projects.
Of course, more Measure B funds could become available to support the capital costs of BSVII if
the expected sales tax revenue exceeds previously anticipated levels. While early projections were
based on 2016 economic conditions, it is important for the strategic funding plan that the sales tax
forecast be updated regularly. The Civil Grand Jury was informed that VTA has ordered an updated
forecast.
Because two key sales tax measures are set to expire, several VTA officials stated in interviews
that they would simply place a measure on a future ballot for voter consideration if an extension
were needed. Given the current sales tax rates applicable within Santa Clara County and the need
for management and oversight reforms identified in this report, there is a risk that voters may not
approve such a measure.
State Funding Risk
As of April 2026, the capital construction funding strategy required $1.5 billion from two State of
California grants. The VTA has received commitments for nearly $200 million of that total. The
sources of funding are the Transit and Intercity Rail Capital Program (TIRCP) and transportation
funds administered by the Metropolitan Transportation Commission (MTC), both of which may
be affected by a recent state decision to provide a bridge loan to Bay Area transit agencies (MTC,
2026).
In February 2026, the California legislature appropriated $590 million from the same TIRCP
account to provide a 12-year loan to MTC. These loan proceeds will be made available to San
Francisco Municipal Transportation Agency, AC Transit, BART, and Caltrain to help address a
greater need for public transit subsidies. The agencies are required to repay the loan over 12 years
(MTC, 2026).
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The state justified the loan on the basis that the transit agencies would be able to stabilize their
financial situations and avoid service reductions pending the anticipated approval in November of
a regional sales tax measure. If the regional measure does not pass, or if for any other reason the
agencies do not repay the loans on time, the timing of the receipt of funding to VTA might create
some cash flow risk for the project.
Further, the TIRCP account itself is funded by payments from private parties who agree to
purchase pollution credits in the state’s Cap and Invest program. The program’s future is uncertain
in light of federal changes to environmental regulations and pending legal challenges from the
State of California (California State Transportation Agency, n.d.).
Federal Funding Risk
In August 2024, the FTA advised VTA that the federal government’s total contribution to the
project would be limited to $5.1 billion. To receive these funds, VTA plans to apply for a Full
Funding Grant Agreement (FFGA) by the end of 2026.
Federal support for large-scale rail projects is uncertain. In 2025, the FTA canceled a $4.2 billion
commitment to the California High-Speed Rail Project (Shalby, 2025). VTA’s lobbyists have
suggested delaying the FFGA application until similar requests from other states are resolved.
Considering the political, economic, and budgetary conditions of the United States, approval of
VTA’s request for an FFGA is highly uncertain. It may be delayed, reduced, or denied.
Low Levels of Ridership Could Increase VTA’s Future Costs
BART ridership on the current regional system has not recovered to pre-pandemic levels.
Ridership in January 2026 remains only 48% of the levels in January 2019 (BART, January 2026;
BART, 2019). Recovering ridership may prove difficult due to the growth of hybrid work patterns.
The Civil Grand Jury also reviewed the forecasts for the first phase of the project, which included
the new Milpitas and Berryessa stations. For January 2026, ridership was 86% below estimates
(see Table 2).
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Table 2: BART Ridership at Milpitas and Berryessa Stations
Forecast for Average Daily
Weekday Ridership for
June 2021 at launch
Actual Ridership,
January 2026
Ridership/Day 20,110 2,789
Source: Joint VTA/BART Working Committee Meeting, December 4, 2020; BART February
2026 Monthly Ridership Snapshot.
Note: VTA created forecasts in 2020, expressed as rides per day. BART actuals are based on
recorded station entries and exits. To normalize BART actuals to the VTA forecast, entries and
exits were averaged to produce a daily ridership figure.
An overall decrease in ridership has led BART to project a $376 million budget deficit for FY2026-
27. To seek additional revenue, BART is relying on a 0.5% additional sales tax measure on the
November 2026 ballot that would begin in 2027 and remain in place for 14 years. If the ballot
measure does not pass, BART has proposed closing up to 15 stations and reducing service hours
and train frequency (BART, February 26, 2026). Ironically, the proposed station closures would
not affect Santa Clara County because VTA is solely responsible for the net operating costs.
According to VTA records reviewed by the Civil Grand Jury, for the first three years of operation,
VTA forecasts annual average costs of $274 million for operations, maintenance, and capital costs.
Average fare revenue is forecast at $60 million, offsetting VTA's financial obligation to BART,
resulting in an average annual financial loss of $214 million. Any drop in ridership will lead to
further financial losses.
The Need for a BSVII Cash Flow Model
With a price tag of $12.7 billion, BSVII is the largest public infrastructure project in Santa Clara
County (Aragon, 2025). Nearly 60% of the planned funding sources include revenue from grants
that will not be distributed in advance but will be reimbursed in accordance with each grant’s draw
schedule (See Figure 1). The timing of those cash inflows must be carefully matched with the
timing of payment schedules for construction contracts worth billions of dollars.
VTA staff is evaluating different approaches to contracting the construction work. Alternatives are
being evaluated for the following reasons: 1) to identify segments of work that could be bid out
separately to accelerate the overall schedule; and 2) to identify segments for which there is a greater
likelihood of strong competitive bids. For each contract, the cash outflows will be specified and
must be carefully matched with the cash inflows.
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A cash flow model that matches receipts and expenditures for BSVII would enable VTA decision-
makers to fully evaluate the alternative approaches being studied. However, VTA officials have
advised the Civil Grand Jury that such a model has not yet been developed. A cash flow model is
necessary to avoid unplanned delays from cash shortfalls.
Oversight Concerns
VTA Board Recognizes That Oversight Must be Improved
Independent reports and audits have identified problems with project management and VTA Board
oversight, including those identified by a prior Civil Grand Jury, the California State Auditor, and
the PMOC (AtkinsRéalis USA Holdings LLC, 2026). VTA’s cost-estimation practices, along with
its lack of transparency around changes to project scope and cost, were identified as significant
deficiencies. VTA’s oversight and management of the BSVII project have also been heavily
criticized by the media, in public comments presented at Board meetings, and in letters to the editor
of multiple local publications.
VTA Board Outsources Guidance and Oversight of the BSVII Project
Following a workshop on the project’s direction in October 2023, the VTA Board Chairman
announced the creation of an Ad Hoc BART Silicon Valley Phase II Oversight Committee (VTA,
2023).
However, only the Board can make binding decisions on the project’s scope, funding, risks,
schedule, and contracting approach. While ultimately accountable itself, the Board nonetheless
effectively delegated oversight to a committee without providing clear direction. By abdicating its
responsibility to set its expectations of how the Oversight Committee can best support the Board,
the committee has been left to set its own course. That course does not keep the Board fully
informed of issues raised by independent experts or the PMOC, hampering its ability to make the
best decisions about the project's funding and schedule.
At its meeting on January 15, 2026, the Oversight Committee adopted what it called a revised
charter intended to clarify the lines of communication and relationships among the auditor general,
SME, VTA staff, and Oversight Committee (VTA, January 15, 2026). Members of the Oversight
Committee had expressed concern about a perceived lack of coordination between VTA staff and
the SME. Nonetheless, the question remains: Is the role of an SME to provide the Board with an
independent review of VTA staff recommendations as originally intended, or is it to help VTA
staff improve their recommendations? Notably, in the following excerpt, the Charter requires the
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auditor general to document issues raised by the SME and the VTA staff but does not require that
the full Board be advised of the critical issues:
To ensure transparency and balanced oversight, selected advisory input from SME will be
documented in Oversight Committee materials. Where consensus exists between the SME
and the Project Team, it will be noted. Where minority or dissenting views are expressed,
the AG [auditor general] will explicitly record final input received alongside the majority
view (VTA Oversight Committee Charter, 2026).
During Oversight Committee meetings, there are few deliberations or actions to provide collective
guidance or oversight, leaving individual members to raise questions and propose guidance for
VTA staff to consider. VTA staff also receives input from individual members in private pre-
meeting briefings. As a result, the full Board does not benefit from Oversight Committee analysis,
and the public is not fully informed about individual Board member perspectives.
The Committee Has Two Purposes: Guidance and Oversight
“Guidance” suggests that the committee helps the Board establish a strategic direction and
recommend actions to keep the project on track. “Oversight,” on the other hand, is a separate
function that ensures VTA staff is accountable for following the Board’s direction in an efficient
and effective manner. “Guidance” looks forward. “Oversight” monitors implementation as it
happens.
Better at Oversight than Guidance
The Oversight Committee requires VTA staff to produce a comprehensive monthly report detailing
the financing and construction progress of the BSVII project. The auditor general provides
insightful periodic reports on his independent review of the project’s costs, risks, and schedule.
The VTA staff’s monthly reports address the information gap identified in the auditor general’s
January 2024 report. As a result, the Oversight Committee can effectively monitor compliance
with the Board’s direction.
However, the Oversight Committee often fails to provide guidance on issues critical to future
strategic direction.
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Strategic Guidance on Critical Issues is Informal, Intermittent, and Often Late
VTA staff routinely provide private briefings to Oversight Committee members prior to meetings.
Those briefings allow VTA staff to explain and advocate for their recommendations and to receive
input and questions from individual members. Occasionally, some agenda materials for an
Oversight Committee meeting are not published with the rest of the agenda because VTA staff
members will modify presentations up to the last minute based on what they have heard in private
briefings.
The Oversight Committee has established an informal standard of limiting its once-monthly
meetings to no more than two hours, and meetings often do not begin on time. At the meetings,
VTA staff often deliver lengthy presentations on issues for which it will subsequently seek Board
approval, leaving little time for committee deliberations.
During these presentations, only a few members ask questions, and rarely does a committee
member propose a policy recommendation that the Oversight Committee might take action on.
Individual Oversight Committee members are given the opportunity to express support or concern
about a proposed VTA staff position, providing VTA staff with some insight into how to frame
their recommendations to the Board.
The Oversight Committee receives independent analyses from the VTA auditor general, its
contracted SME, and the PMOC. The committee often receives lengthy written comments from
the public but limits oral comments to one minute. Members of the committee rarely comment on
materials received from the public, many of which are extensive critiques of the VTA staff
recommendations. Following each meeting, the Oversight Committee chair submits a short report
summarizing discussion topics, which is placed on the VTA Board’s consent calendar.
Following presentation to the Oversight Committee, formal VTA staff recommendations are made
to the VTA Board, but without the benefit of a summary or synthesis of the alternative perspectives
from the auditor general, SME, PMOC, or informed public comment.
The Civil Grand Jury identified three examples of policy issues for which guidance was needed
but delivered inadequately. One of the examples, the single-bore versus twin-bore issue, illustrates
both the failure of the committee to make recommendations and the VTA staff’s failure to follow
through on committee requests in a timely manner.
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Example of Inadequate Guidance: The KST Contract Decision
The Oversight Committee endorsed a major contract change without providing independent
analysis, articulating its rationale, or conveying identified risks to the Board.
VTA had issued a contract to a construction consortium, Kiewit Shea Traylor (KST), using a
“progressive/design/build” approach, under which KST would design the tunnel project and, after
reviews by VTA and its construction management consultant, KST would build it. By the spring
of 2025, VTA believed that KST’s proposed design could significantly increase the project’s
estimated cost by up to $1 billion and that it would be preferable to engage in a competitive bidding
process for the remaining tunnel work. In a more traditional contract approach, VTA would prepare
the design specifications and contract conditions. To accomplish this, it was necessary to limit the
contract with KST to only the work required to prepare for the TBM, which VTA would own but
make available to the tunneling contractor to operate and maintain.
At its June 12, 2025, meeting, VTA staff presented its proposal to modify the KST contract to the
Oversight Committee, which unanimously endorsed it. Two weeks later, the VTA Board met and
approved VTA staff recommendations. Although the VTA staff agenda report did include a
reference to the Committee’s recommendation, it did not include the risk analysis that had been
reviewed by the Committee. The Oversight Committee’s regular report to the VTA Board was
placed on the consent calendar and simply reported the committee’s concurrence with the VTA
staff recommendation. There was no report or analysis laying out the reasons for the Oversight
Committee’s concurrence or the SME’s risk assessment. Therefore, the Board made its decision
without a complete understanding of the risks.
Example of Inadequate Guidance: The Twin-Bore versus Single-Bore Decision
The Oversight Committee retroactively requested a side-by-side analysis of tunnel options through
Downtown San José.
A preliminary design controversy was whether to tunnel two smaller bores for the downtown San
José underground tracks or to tunnel a single larger bore at greater depth. Downtown businesses
had raised concerns that the twin-bore approach would require additional work and disrupt their
operations during construction.
BART initially opposed the single-bore tunnel approach because it differed from its existing,
smaller twin-bore tunnels. However, the BART inspector general reported that in the spirit of
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cooperation, BART officials consented to the single-bore approach after being assured that
operational and safety concerns would be met (BART, December 19, 2025).
In December 2022, VTA approved the fabrication and purchase of a large TBM for $76 million,
effectively locking in the single-bore approach. In a news article dated November 7, 2023, in the
Mountain View Voice, San José Mayor Matt Mahan was quoted as saying: “There is no turning
back now” (Hicks, 2023).
Nonetheless, individual Board members and informed public commenters continued to raise
questions about whether a twin-bore approach might be cheaper, faster, and safer for BART
operations. In response, members of the Oversight Committee commissioned an analysis of the
two options for costs, risks, and impact on schedules.
In September 2025, more than 18 months after the request, VTA and its engineering consultants
presented their analysis to the Oversight Committee, confirming the single-bore approach.
Although it had requested the analysis, the Oversight Committee did not make a recommendation
to the Board. In October 2025, the Board was presented with the VTA staff and consultants’
analysis and confirmed the single-bore approach by declining to take steps to amend the
environmental documents or modify the tunneling contracts.
Example of Inadequate Guidance: Scenario 1 versus 1a Decision
In October 2025, VTA decided on an approach to the construction of the tunnel without the benefit
of the SME’s analysis that the Oversight Committee had requested.
Before design work could progress to a more advanced level, the VTA Board needed to decide
between two alternatives for staging the actual tunneling work. The SME had suggested that
concurrent tunneling from both ends could reduce costs and accelerate the schedule (VTA, June
12, 2025). The two options were labeled “Scenario 1” (a straight-through tunneling using the larger
TBM from west-to-east) and “Scenario 1a” (an option of concurrent tunneling starting at both the
east and west portals using two TBMs).
Although this would require two TBMs, the east-to-west work could be done simultaneously with
a smaller-bore tunneling machine. Further, the SME reported that a smaller-bore TBM was readily
available and would require less lead time than the TBM being fabricated in Germany.
Because the Oversight Committee considered the potential benefits significant, the committee
asked both VTA staff and the SME to analyze the options and prepare a recommendation. On
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August 4, 2025, the Oversight Committee authorized an expenditure of $110,000 and directed the
auditor general to contract with GZ for the requested work. GZ presented interim reports on
September 11, 2025, and October 9, 2025, and promised to deliver its completed report at the
November 2025 meeting of the Oversight Committee.
VTA staff subsequently presented its analysis and recommendations to the Oversight Committee
on October 9, 2025. Although the Project Manager stated that the VTA staff was aware of some
of GZ’s preliminary analysis (especially differing assumptions about the rate at which each of the
two TBMs can move forward when digging a tunnel), VTA staff requested a Board meeting to
decide between the two alternatives. In prior presentations to the Oversight Committee, VTA staff
said that the analysis would be presented at a Board “workshop” (at which no formal action could
be taken). However, a special meeting of the Board was called for October 17, 2025, and VTA
staff made its recommendations to the Board, neglecting to advise the Board that the Oversight
Committee was still awaiting the GZ analysis that the Committee had authorized.
The Oversight Committee failed to present any report or recommendation at the special meeting.
As a result, the Board adopted ‘Scenario 1’ without the benefit of an independent analysis of the
risks.
On February 12, 2026, four months after the Board made its decision, the SME presented his
written report analyzing the options and raising concerns that should have been considered before
the decision.
VTA Staff Accountability for Responding to Oversight Committee Member Requests
The auditor general maintains two types of monitoring reports: a tracking report that lists the
requests of individual committee members for information or analysis, and a work plan that lists
the schedule for upcoming formal reports, including risk assessments such as financing and
procurement risks. Both monitoring reports establish a due date, but the deadlines are often not
met.
During public meetings, Oversight Committee members rarely discuss the tracking report or the
work plan and do not publicly comment on changes to the expected date in subsequent reports.
More importantly, neither the auditor general nor the Oversight Committee holds VTA staff
accountable for late responses to issues raised in the tracking report. Below, the Civil Grand Jury
presents two examples:
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Example of Lack of Accountability: Prolonged Delay in Analysis of Single-Bore versus Twin-Bore
The side-by-side analysis of two design options was not provided until more than 18 months after
it was first requested.
At the Oversight Committee’s first meeting in November 2023, a member of the public requested
that the committee order a cost and risk analysis of the single-bore versus twin-bore options, which
remained controversial following the VTA Board’s selection of the single-bore option in 2018. In
2023, the Chair of the Oversight Committee responded that such an “apples-to-apples” (side-by-
side) analysis would be one of the committee’s first tasks. Here are some of the subsequent
activities:
• At the committee’s meeting on January 19, 2023, two committee members formally
requested the “apples-to-apples” analysis and placed it on the committee’s tracking list.
(VTA, March 2025). At its meeting on June 13, 2024, the Project Manager reported that
the scope of the twin-bore analysis would be worked on and reported to the Board “over
the course of the summer.”
• At its meeting on August 8, 2024, a member of the public asked about the status of the
“apples-to-apples” analysis.
• At the September 12, 2024, Oversight Committee, the auditor general announced that VTA
staff had asked engineering design contractor Mott Macdonald to conduct the “apples-to-
apples” review.
• The March 2025 tracking report included a comment regarding the “apples-to-apples”
comparison: “These items are being evaluated as part of cost savings task force efforts with
participation from GZ” (VTA, April 2024).
• One year later, on September 11, 2025, Mott Macdonald presented its analysis of the twin-
bore versus single-bore options – nearly 22 months after the request was first discussed at
an Oversight Committee meeting – concluding that the single-bore option was preferred
(VTA, September 11, 2025).
Example of Lack of Accountability: An Alternative Strategy Some Call “Plan B”
Despite multiple requests for an alternative strategy to address risks associated with the federal
funding decision, VTA staff advised the Oversight Committee that it would wait until after the
federal decision.
Since the Oversight Committee meeting on October 9, 2025, committee members have stressed
the need for an alternative strategy in the event the federal government delays or denies the FFGA
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for the promised $5.1 billion. Some committee members asked whether a “Plan B” might include
reducing the number of planned stations or revising the funding strategy. VTA staff reported to
the Civil Grand Jury that there was reluctance to discuss a “Plan B” out of concern that the
discussion itself might jeopardize the FFGA. At public meetings, VTA staff dismissed requests
for an alternative funding strategy, instead reporting that an alternative plan should not be prepared
until the FTA made its decision in 2027. This is an example of the VTA staff’s dismissal of the
Oversight Committee direction.
Expediency of Decisions versus Rigorous Analysis
The Civil Grand Jury identified tension between VTA Board members’ competing goals: avoiding
delays in decision-making and requiring rigorous, independent analysis of costs, risks, and
schedule. In public meetings, the Project Manager has often stated that each month of delay adds
$20 to $30 million to the overall project cost (Dorsey, 2025).
There is a strong financial incentive to keep the project moving by advancing decisions
incrementally—approving one component at a time to show visible progress—without fully
evaluating how each step alters the project’s overall cost, scope, and risk. For a project of this size,
complexity, and cost, this piecemeal approach masks cumulative effects, increasing the likelihood
of cost escalation and delays. These should be identified and addressed through rigorous, front-
end analysis.
With two-year terms and constituencies limited to portions of the County, Board members may
understandably focus on immediate actions rather than the long-term, systemwide implications
that demand a coherent strategic plan.
The Role Assigned to the Auditor General
The Oversight Committee benefits from periodic risk assessments and audits performed by the
VTA auditor general on the BSVII project. However, by assigning the auditor general the
responsibility to also provide staff support to the Oversight Committee, VTA has created a
situation in which the auditor general is asked to provide an independent audit of prior decisions
while also assisting the committee in evaluating future policy and management decisions.
At the June 2025 public Board meeting, the auditor general stated that he sometimes feels like a
referee among the analyses provided by VTA staff, the SME, the public, and the PMOC. However,
the VTA Board is the final arbiter, not the auditor general.
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The Board is best served when it hears all relevant views on an upcoming decision and is presented
with options and a recommendation. The auditor general’s participation and input are critical, but
he should not be placed in the position of having to synthesize all the competing views, including
his own.
The auditor general is better placed to assist the Oversight Committee in its role of “oversight”
and less so in commenting on the Oversight Committee's “guidance” functions. Accordingly, the
Oversight Committee and the VTA Board would be better served if a VTA staff person were
assigned responsibility for staffing the committee. This person could be part of the General
Manager’s Office and should not report to the Project Manager. The position would be like that of
the chief of staff, which was recently assigned to support the chair of the Board.
Coordination with BART
Because the County of Santa Clara is not part of the BART District, the extension of rail service
to San José required a contract that established both VTA’s and BART’s commitment to cooperate.
Under the 2001 Cooperative Agreement, VTA is financially responsible for paying for the design,
construction, and operation of the segment in Santa Clara County (BART and VTA,
Comprehensive Agreement, 2001). BART retained approval authority over design elements that
affect operations, maintenance, and safety. To date, this has been accomplished through the joint
preparation of a Design Criteria Manual.
As recently as December 2025, BART’s Independent Office of the Inspector General (OIG) issued
a report titled: “Transparency & Communication Gaps in the BSVII Project.” The report
summarizes years of controversy over the single-bore versus twin-bore approach but
acknowledges that BART eventually agreed to the single-bore concept evaluated in the final
environmental impact statement. However, the BART OIG remained critical of the extent of
cooperation between the two agencies:
We also determined that the length of time since the project began, extensive media
coverage of the project, conflicting subject-matter opinions, and some public displeasure
with the single-bore design have created uncertainty about the project’s direction. We
concluded that gaps in transparency and communication, including limited public
discussions in recent years, have resulted in mixed messaging on a project that has evolved
over multiple decades (BART Independent Office of the Inspector General, 2025).
In August 2025, the lack of communication and cooperation was publicly exposed when a BART
official wrote a letter to VTA (Appendix A) specifically objecting to the consideration of reducing
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the size of the Newhall Yard and Maintenance Facility as a capital cost-saving measure. The VTA
Project Manager publicly acknowledged a failure to keep BART informed of design issues that
might impact BART’s operational efficiency and pledged to develop recommendations to the
administrative heads of both agencies on a more formal process to identify and resolve those issues
(VTA Oversight Committee, 2025).
Board Experience and Continuity
Since 2019, five audits and reports have critiqued VTA’s governance structure and recommended
a series of revisions to improve VTA’s capability to provide Board direction and oversight of the
BART extension. Those audits have included the 2018-19 Santa Clara County Civil Grand Jury in
2019; the Auditor of the State of California, in 2024; the BART Independent Office of the
Inspector General in 2025; RSM US LLC, a VTA subcontractor, in 2019; and the VTA Auditor
General in 2024. VTA has accepted and acted on most of the recommendations for governance
reform, except those relating to the terms and required experience level of Board members.
During the investigation of the BSVII project, sources repeatedly raised concerns about the level
of knowledge and decision-making ability of the full VTA Board, which is responsible for the
project’s success. Decisions made today will have a direct impact on its ultimate success. Diligent
oversight of its schedule, cost, progress, and scope is required.
According to the California Public Utilities Code, which established the VTA Board, “to the extent
possible, the appointing powers shall appoint individuals who have expertise, experience, or
knowledge relative to transportation issues” (Pub. Util. Code 10000 et seq).
VTA Board members are appointed to two-year terms by appointing agencies, organized into six
groups as detailed in Table 3. Appointing agency groups are established and defined by VTA
Administrative Code, which states “Appointing Authorities are strongly encouraged, where
possible, to: (1) appoint individuals with appropriate experience and qualifications in
transportation; (2) ensure that there is sufficient remaining time in the elected official’s term of
office to allow full completion of their term as a Director; and (3) reappoint representatives to
consecutive terms” (VTA Administrative Code § 2-13).
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Table 3: Appointing Authorities Composition of the VTA Board
Appointing
Agency
Group
Jurisdiction Represented Number of
Board Members
Method of
Appointment
Group 1 San José 5 members
1 alternate
Appointed by city
council from city
council members/mayor
Group 2 Los Altos, Los Altos Hills,
Mountain View, Palo Alto
1 member
1 alternate
Determined by
Group 2 members
Group 3
Campbell, Cupertino,
Los Gatos, Monte Sereno,
Saratoga
1 member
1 alternate
Determined by
Group 3 members
Group 4 Gilroy, Morgan Hill 1 member
1 alternate
Determined by
Group 4 members
Group 5 Milpitas, Santa Clara,
Sunnyvale
2 members
1 alternate
Determined by
Group 5 members
Group 6 County of Santa Clara 2 members
1 alternate
Appointed by County
Board of Supervisors
Source: California Pub. Util. Code section 100060.
While VTA continues to insist that two-year terms are suitable for its governance (as specified in
PUC § 100060.2), peer agencies in the state appoint their Board members to four-year terms,
leading to much longer average lengths of service and potentially greater experience and
transportation-related knowledge (see Figure 2).
Multiple reports and audits have suggested weaknesses introduced by VTA’s approach to the
appointment of Board members. For example, the 2019 Board Governance Assessment concluded,
in part, that some processes and policies (e.g., committee structure, term limits, and Board member
selection guidelines) might not reflect best practices or support long-term Board stability (VTA,
2019). Additionally, a report by the 2018-19 Santa Clara County Civil Grand Jury found that the
VTA Board suffers from:
• A lack of experience and limited continuity by many Board members;
• Inadequate time for the directors to devote to the Board’s oversight and policy-making
functions;
• A lack of engagement by some of the directors, fostered in part by the committee system,
resulted in VTA functioning largely as a staff-driven organization.
More recently, a critical 2024 report from the State Auditor regarding VTA’s project management
and financial oversight noted the following weaknesses:
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• The process for selecting directors for the Board is not always transparent enough to ensure
the appointment of directors experienced in transportation issues.
• Some groups of cities appoint VTA directors without public deliberation, limiting
transparency and sometimes bypassing the statutory recommendation for transportation
expertise.
• VTA directors have shorter tenures, on average, than their peers, meaning that VTA’s
Board has less experience overseeing the agency’s operations than the Boards of peer
agencies.
Figure 2: Average Directors’ Tenure among VTA and Peer Agencies
Source: Auditor of the State of California, “Santa Clara Valley Transportation Authority,
Improvements Are Necessary to Strengthen Its Project Management and Financial Oversight,”
June 2024.
Note: LA Metro stands for Los Angeles County Metropolitan Transportation Authority; OCTA
stands for Orange County Transportation Authority; SacRT stands for Sacramento Regional
Transit District.
During interviews and in reviewing existing reports and audits about VTA, the Civil Grand Jury
learned that Board members and elected officials broadly support a four-year term for directors.
Lengthening terms would require a change to VTA’s enabling legislation. The findings of the State
and VTA’s own auditors’ governance reform recommendations remain unchanged.
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Public Communication
Following the VTA auditor general’s report in January 2024, public communication and
community outreach regarding the BSVII project have improved. The Civil Grand Jury noted
improvements to the VTA BSVII project website, including efforts to deliver timely updates to
residents about the impact of construction activities, and a section for frequently asked questions
(FAQ) (VTA, BART Silicon Valley Phase II Project, n.d.). In addition, many interviewees told
the Civil Grand Jury that VTA has made efforts to better inform the public and officials since the
auditor general's report highlighted communication breakdowns in 2023.
However, there are areas where the public would benefit from VTA focusing more on improving
communication.
The VTA’s BSVII project website does not offer a simple, clear dashboard outlining the costs,
timeline, and progress of the BSVII project. Although it includes technical reports from the
federally sponsored PMOC, it does not include the independent analyses by the SME or the VTA
auditor general.
A high-level dashboard would consolidate information from multiple sources, present project
metrics to the public, and provide access to source materials. Today, information on funding,
expenditures, and schedule status is available on the website, but is buried in layers of reports that
are nonintuitive to find or navigate.
In addition, the Civil Grand Jury found the site’s search function inadequate for locating specific
details or addressing questions not covered in the FAQ, and it often returned results for irrelevant
materials. The website would be more user-friendly if VTA incorporated a more robust search
engine.
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CONCLUSION
The VTA Board has failed in its responsibility to provide effective management, oversight, and
financial control of the BSVII Project.
Based on its investigation, the Civil Grand Jury concludes:
• There is no realistic plan to deal with foreseeable financial risks, including significant
uncertainty about BSVII’s construction and operating costs, reliance on expiring voter-
approved sales tax measures, uncertain federal government support, cash flow, and
declining ridership.
• When considering major scope and design decisions, the Oversight Committee and the
VTA Board do not take into account the ongoing operations and maintenance costs that
will be borne by VTA and will require voter approval of subsequent sales tax measures.
• The Oversight Committee exercises its oversight responsibility by requiring monthly
progress reports and by questioning VTA project staff, but when it declines to make
recommendations to the VTA Board, it fails in its responsibility to provide guidance on
critical policy issues.
• The Oversight Committee receives valuable input from multiple sources but does not share
this information with the VTA Board in the form of helpful reports that synthesize the
different perspectives of VTA staff, the Subject Matter Expert, the auditor general, the
Project Management Oversight Consultant, and the public.
• The VTA Board and the Oversight Committee have failed to hold VTA staff accountable
for missing deadlines to provide analysis and information requested by members of the
Oversight Committee.
• There is a lack of meaningful communication and cooperation between BART and VTA
officials, which undermines public confidence.
• VTA’s failure to adopt governance reform recommendations from prior Civil Grand Jury
reports and independent audits has led to a lack of Board member continuity and expertise,
weakening the Board’s ability to successfully oversee the BSVII project.
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FINDINGS AND RECOMMENDATIONS
Finding 1
The BSVII project currently requires voter approval of additional sales tax measures to address
gaps in construction and operations funding.
Recommendation 1
VTA should adopt and publish a strategy for the completion and operation of the project that
reduces dependency on new sales tax measures.
This should be implemented by December 31, 2026.
Finding 2
VTA does not maintain a cash-flow model for the BSVII project.
Recommendation 2
The VTA Board should direct the General Manager to prepare a cash-flow model for the BSVII
project and present it quarterly to the Oversight Committee and the Board.
This should be implemented by December 31, 2026.
Finding 3
VTA has not developed an alternative funding strategy for the project in the event that planned
funding sources are unavailable or insufficient.
Recommendation 3
The VTA Board should direct the General Manager to prepare an alternative funding strategy to
meet the project’s estimated total capital costs and VTA’s responsibility for operating and
maintenance costs and present it to the Oversight Committee and Board for approval.
This should be implemented by December 31, 2026.
Finding 4
Project management does not consistently report the operating and maintenance cost implications
of design and construction decisions to the Oversight Committee or the Board.
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Recommendation 4
VTA should adopt a policy requiring staff to present an analysis of operating and maintenance
costs when considering design and construction alternatives for BSVII.
This should be implemented by December 31, 2026.
Finding 5
The VTA Board would benefit from longer terms of office to improve continuity and institutional
knowledge.
Recommendation 5
VTA should reconsider its prior rejections of audit recommendations calling for the establishment
of four-year terms and direct its legislative advocates to seek a legislative author to amend VTA’s
enabling statute to require four-year terms.
This should be implemented by December 31, 2026
Finding 6
VTA Board Appointing Authority Groups 2 through 5 often do not follow VTA Administrative
Code (Section 2-14) admonitions to “appoint individuals with appropriate experience and
qualifications in transportation” and to “reappoint representatives to consecutive terms.”
Recommendation 6
VTA Board Appointing Authority Groups 2 through 5 should certify to the VTA Board that they
will adhere to VTA Administrative Code (Section 2-14) admonitions, regarding Board member
expertise and appointment to consecutive terms.
This should be implemented by December 31, 2026.
Finding 7
VTA Board Appointing Authority Groups 2 through 5 have different processes for making Board
appointments.
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Recommendation 7
The cities represented in Appointing Authority Groups 2 through 5 should agree on a uniform
process for making Board appointments.
This should be implemented by December 31, 2026.
Finding 8
The role assigned to the auditor general is outside the traditional scope of an auditor’s
responsibilities and has introduced conflict and uncertainty among VTA staff and the Oversight
Committee. Being involved in the management and policy-making process threatens the auditor
general’s independence.
Recommendation 8
The Board should implement an alternative model for supporting the Oversight Committee that
does not rely on the auditor general to provide services such as agenda preparation, monitoring of
VTA staff assignments, or preparation of a synthesis of multiple independent inputs to the
Committee’s deliberations.
This should be implemented by December 31, 2026
Finding 9
The Board of Directors has not approved the bylaws, nor the charter of the Oversight Committee.
Recommendation 9
VTA should formally adopt a revised Charter for the Oversight Committee, setting the Board’s
expectations on the following issues:
• Defining the role of the auditor general to no longer require him to supervise the
presentations by VTA staff to the Oversight Committee;
• The responsibility of the Oversight Committee to report regularly to the Board on the
independent analyses of costs, risks, and schedule by the PMOC and any SMEs; and to
provide the Oversight Committee’s synthesis of those analyses with recommendations to
resolve conflicts when necessary;
• The responsibility of the Oversight Committee to consider and present its
recommendations before the Board considers major decisions such as scope of the project,
contracting, risk management, budgeting, and funding strategy;
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• The responsibility of the Oversight Committee to hold subject matter experts accountable
for timely analysis of costs, risk, and schedule;
• The responsibility of the Oversight Committee to report to the Board on the implications
of design and construction issues that impact future ongoing operations and maintenance
costs to be borne by VTA.
This should be implemented by December 31, 2026.
Finding 10
VTA’s vtabart.org website is poorly organized and not always intuitive to navigate, making it hard
to find information about the status, cost, and schedule of the BSVII project.
Recommendation 10
The VTA Board should direct the General Manager to implement and maintain a project dashboard
on its vtabart.org website that includes status, cost, and schedule information.
This should be implemented by October 31, 2026.
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REQUIRED RESPONSES
Pursuant to California Penal Code section 933(a) et seq. and California Penal Code section
933.05, the 2025-26 Santa Clara County Civil Grand Jury requests responses from the
following governing bodies:
Responding Agency Findings Recommendations
VTA Board of Directors 1, 2, 3, 4, 5, 8, 9, 10 1, 2, 3, 4, 5, 8, 9, 10
County of Santa Clara, Board of Supervisors 6 6
The City of Campbell, City Council 6, 7 6, 7
The City of Cupertino, City Council 6, 7 6, 7
The City of Gilroy, City Council 6, 7 6, 7
The City of Los Altos, City Council 6, 7 6, 7
The Town of Los Altos Hills, Town Council 6, 7 6, 7
The Town of Los Gatos, Town Council 6, 7 6, 7
The City of Milpitas, City Council 6, 7 6, 7
The City of Monte Sereno, City Council 6, 7 6, 7
The City of Morgan Hill, City Council 6, 7 6, 7
The City of Mountain View, City Council 6, 7 6, 7
The City of Palo Alto, City Council 6, 7 6, 7
The City of San José, City Council 6, 7 6, 7
The City of Santa Clara, City Council 6, 7 6, 7
The City of Saratoga, City Council 6, 7 6, 7
The City of Sunnyvale, City Council 6, 7 6, 7
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VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II
APPENDIX A: BART Management Letter
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VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II
VTA'S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II
kai
BART SILICON VALLEY
PHASE II (BSV I)
BART rema i n s fully c ommitted to the success ful del ivery of this critical regio nal investmen t .
H owe ver, that commitmen t d ep ends on VTA's i m medi ate corrective action to rest ore tra nsparency
and ac co untability.
Sincerely,
Shane Edwards
BART Assis tant General Manager, 0perations
BART Project Director
Ce: VTA's BART S i l icon Vall ey P hase II 0versight Com m i ttee Members
Greg R i chardson, VTA Deputy General Manager
Robert Po w e rs , BART General Manager
Mich ae l Jones, BART D ep uty General Manager
Ni Lee, BART D epu t y P roj ect D i rector
M o n i ca Born, VTA Program Director
Tom Maguire, VTA C h i ef De l i very Officer of Mega Proj ects
BSVII: Co ll aborati o n , I n n ovat i on, Safety, R e l i ab ility 2
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VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II
CONFLICTS
Members of the Civil Grand Jury are conflicted from a Civil Grand Jury investigation if, as a result
of prior or current employment or associations, investment in public or private enterprise, financial
interest, bias, or personal relationship, they are subject to recusal from participating in a matter
before the Civil Grand Jury. One juror was recused from this matter.
REFERENCES
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Aragon, Greg, “Single-Bore Tunnel Method Chosen for BART Silicon Valley Phase II.”
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Are Necessary to Strengthen Its Project Management and Financial Oversight.” June
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2026.
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VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II
Cal. Pub. Util. Code section 10000 et seq.
Cal. Pub. Util. Code section 100060 et seq.
Dorsey, Dustin. “Silicon Valley BART Extension construction remains on time, budget.” ABC
Eyewitness News. December 8, 2025. (https://abc7news.com/post/silicon-valley-bart-
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29, 2026.
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California. June 2024. (https://www.transit.dot.gov/sites/fta.dot.gov/files/2024-08/CA-
BART-Silicon-Valley-Phase-II-Eng-Profile-20240705.pdf). Accessed March 30, 2026.
Geha, Joseph. “Feds Commit $5.1 Billion to South Bay BART Extension.” KQED.org. August
2, 2024. (https://www.kqed.org/news/11998646/feds-commit-5-1-billion-to-south-bay-
bart-extension#:~:text=Joseph%20Geha,increases%20to%20the%20current%20figure).
Accessed April 22, 2026.
Hicks, Tony. “VTA Board approves purchase of machine to bore BART line.” Mountain View
Voice. November 7, 2023. (https://www.mv-voice.com/news/2023/11/07/vta-board-
approves-purchase-of-machine-to-bore-bart-line/). Accessed April 5, 2026.
Metropolitan Transportation Commission. “Agreement Reached on Loan for Bay Area Transit
Agencies.” January 30, 2026. (https://mtc.ca.gov/news/agreement-reached-loan-bay-area-
transit-
agencies#:~:text=Because%20many%20transit%20capital%20projects,funds%20remaine
d%20in%20state%20accounts.). Accessed April 28, 2026
Office of the County Counsel, County of Santa Clara. “County Counsel’s Impartial Analysis of
Measure B.” 2016. (https://www.vta.org/sites/default/files/2025-
08/2016%20Measure%20B%20Ballot.pdf). Accessed April 29, 2026.
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VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II
San Francisco Bay Area Rapid Transit District Independent Office of the Inspector General.
“Transparency & Communication Gaps in BSVII Project.” December 19, 2025.
(https://www.bartoig.org/investigation-reports-2025#docaccess-98152ed2acf38
cd4da53e1efbb737c86cc96ef6c2e1f439edf6ec6f51905271f). Accessed April 5, 2026.
San Francisco Bay Area Rapid Transit District and Santa Clara Valley Transportation Authority,
Comprehensive Agreement, November 22, 2001.
(www.bart.gov/sites/default/files/docs/O%26M%20Agreement_Silicon%20Valley%20B
ART%20Extn.pdf). Accessed May 12, 2026.
San Francisco Bay Area Rapid Transit District. “BART Board initially approves Alternative
Service Plan outlining budget balancing details.” February 26, 2026.
(https://www.bart.gov/news/articles/2026/news20260226-0). Accessed April 29, 2026.
San Francisco Bay Area Rapid Transit District. "January 2026 Monthly Ridership Snapshot."
February 2026. (https://www.bart.gov/sites/default/files/2026-
02/202601%20Monthly%20Ridership%20Snapshot.pdf). Accessed April 29, 2026.
San Francisco Bay Area Rapid Transit District. " 2019 Monthly Ridership Reports." 2019.
(https://www.bart.gov/sites/default/files/docs/ridership_2019.zip). Accessed April 29,
2026.
Santa Clara Valley Transportation Authority, BART Silicon Valley Phase II Project. n.d.
(https://www.vtabart.org). Accessed May 12, 2026.
Santa Clara Valley Transportation Authority, “VTA Board of Directors Workshop Reviews
BART Phase II Timeline, Costs, And Next Steps.” October 23, 2023.
(https://www.vta.org/blog/vta-board-directors-workshop-reviews-bart-phase-ii-timeline-
costs-and-next-steps). Accessed April 29, 2026.
Santa Clara Valley Transportation Authority Auditor General. “Auditor General’s Initial
Monitoring Report on VTA’s BART Silicon Valley Phase II Extension Project.” VTA’s
BART Silicon Valley Phase II Extension Oversight Committee Agenda. Item 8a. January
19, 2024. (https://santaclaravta.iqm2.com/Citizens/Detail_Meeting.aspx?ID=4233).
Accessed April 5, 2026.
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VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II
Santa Clara Valley Transportation Authority/RSM US LLC. “Board Governance Assessment –
Santa Clara Valley Transportation Authority.” December 20, 2019. (https://www.vta.gov/
sites/default/files/2020-01/VTA%20Board%20Governance%20Assessment%20
%281%29.pdf). Accessed April 5, 2026.
Santa Clara Valley Transportation Agency. “BART Silicon Valley Extension Project Implements
Major Cost Reductions.” November 13, 2024. (https://www.vta.org/blog/bart-silicon-
valley-extension-project-implements-major-cost-reductions). Accessed April 23, 2026.
Santa Clara Valley Transportation Authority/HayGroup. “Santa Clara Valley Transportation
Authority Organizational and Financial Assessment Executive Report.” March 2007.
(https://ti.org/pdfs/HayGrouponVTA.pdf). Accessed April 5, 2026.
Santa Clara Valley Transportation Authority. “Operations and Maintenance Agreement By and
Between the Santa Clara Valley Transportation Authority and The San Francisco Bay
Area Rapid Transit District.” May 22, 2020. (https://www.vta.org/sites/default/files/2020-
12/VTA%20BART%20Operations%20and%20Maintenance%20Agreement_0.pdf).
Accessed April 23, 2026.
Santa Clara Valley Transportation Authority. “Santa Clara Valley Transit Authority
Administrative Code (With Amendments through March 6, 2025).” March 2025.
(https://www.vta.org/sites/default/files/2025-04/VTA_Administrative_Code_2025-3-
6.pdf). Accessed April 5, 2026.
Santa Clara Valley Transportation Authority. “Bylaws for VTA’s BART Silicon Valley Phase II
Oversight Committee.” April 4, 2024. (https://www.vta.gov/sites/default/files/2024-04/
vta-bsv-oversight-committee-bylaws_0.pdf). Accessed April 8, 2026.
Santa Clara Valley Transportation Authority. Special Board Meeting. October 17, 2025. (https://
santaclaravta.iqm2.com/Citizens/FileOpen.aspx?Type=14&ID=4297&Inline=True)
Accessed April 9, 2026.
Santa Clara Valley Transportation Authority. “VTA's BART Silicon Valley Phase II Oversight
Committee Regular Meeting”, Agenda Item 9.a, Item #25. April 17, 2024.
(https://santaclaravta.iqm2.com/Citizens/FileOpen.aspx?Type=1&ID=3940&Inline=True
). Accessed May 1, 2026.
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Santa Clara Valley Transportation Authority. “VTA's BART Silicon Valley Phase II Oversight
Committee Regular Meeting.” Agenda Item 4, Item #4. March 13, 2025.
(https://santaclaravta.iqm2.com/Citizens/FileOpen.aspx?Type=1&ID=4138&Inline=True
). Accessed May 1, 2026.
Santa Clara Valley Transportation Authority. “VTA's BART Silicon Valley Phase II Oversight
Committee Regular Meeting.” Item 11a. June 12, 2025.
(https://santaclaravta.iqm2.com/Citizens/Detail_Meeting.aspx?ID=4430). Accessed April
29, 2026.
Santa Clara Valley Transportation Authority. “BSVII Project Update.” Summer, 2025.
(https://vtabart.org/vtas-bart-silicon-valley-phase-ii-extension-project-summer-2025/).
Accessed May 13, 2026.
Santa Clara Valley Transportation Authority. “VTA's BART Silicon Valley Phase II Oversight
Committee Regular Meeting.” Item 8. January 15, 2026.
(https://santaclaravta.iqm2.com/Citizens/FileOpen.aspx?Type=1&ID=4354&Inline=True
). Accessed April 22, 2026.
Santa Clara Valley Transportation Authority. “2000 Measure A.” n.d.
(https://www.vta.org/projects/funding/2000-measure-a). Accessed April 29, 2026.
Santa Clara Valley Transportation Authority. “About 2016 Measure B.” n.d.
(https://2016measureb.vta.org/about). Accessed April 29, 2026.
Santa Clara Valley Transportation Authority. “VTA's BART Silicon Valley Phase II Oversight
Committee Regular Meeting.” Item 10b. Slide 21. September 11, 2025.
(https://santaclaravta.iqm2.com/Citizens/FileOpen.aspx?Type=1&ID=4273&Inline=True
). Accessed April 13, 2026.
Santa Clara Valley Transportation Authority. “Fact Sheet: VTA's Bart Silicon Valley Phase 2
Extension Project.” March 2024. (https://www.vta.org/sites/default/files/2024-
07/VTABSV_FactSheet_2024_OverviewBenefits%201.pdf). Accessed April 13, 2026.
Shalby, Colleen. “Trump administration pulls billions in funding for high-speed rail project; state
leaders call decision ‘illegal.’” Los Angeles Times. July 16, 2025.
(https://www.latimes.com/california/story/2025-07-16/trump-administration-cancels-
funding-for-high-speed-rail-project). Accessed April 29, 2026.
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Shalby, Colleen. “Multibillion-dollar transit project to tunnel through the Santa Monica
Mountains is approved by L.A. Metro.” LA Times. January 22, 2026.
(https://www.latimes.com/california/story/2026-01-22/this-multibillion-dollar-transit-
project-could-improve-traffic-across-la-it-goes-to-vote-today - :~:text=This is read by
an,transit projects in the country). Accessed April 13, 2026.
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VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II
This report was ADOPTED by the 2025-2026 Santa Clara County Civil Grand Jury on this 17 th
day of June, 2026.
______________________________
Dinesh Ramde
Foreperson
Attachment B
September __, 2026
The Honorable Julie A. Emede
Presiding Judge
Santa Clara County Superior Court
191 North First Street
San Jose, CA 95113
RE: City of Palo Alto Response to 2026 Santa Clara County Civil Grand Jury Report:
VTA’s Management and Oversight of BART Silicon Valley Phase II
Dear Judge Emede:
The following is the City of Palo Alto’s response to the above-mentioned Grand Jury Report
pursuant to California Penal Code §§ 933 and 933.05.
Civil Grand Jury Finding 6:
VTA Board Appointing Authority Groups 2 through 5 often do not follow VTA Administrative
Code (Section 2-14) admonitions to “appoint individuals with appropriate experience and
qualifications in transportation” and to “reappoint representatives to consecutive terms.”
City of Palo Alto Response to Finding 6:
The City of Palo Alto disagrees with Finding 6, to the extent this finding applies to the City of
Palo Alto and VTA Board Group 2. Group 2 Cities Working Group Resolution No. 2022-01
(enclosed herewith) governs the appointment of the Group 2 representative to the VTA Board.
The Resolution incorporates the requirements of VTA Administrative Code section 2-14 into the
appointment process, including (1) requirements for transportation-related experience and (2)
a requirement that any eligible sitting Board Member or alternate be appointed to a second
term after serving their first term. The Resolution also requires that appointment of the Board
Member and alternate shall take place at a noticed meeting open to the public.
The last two Group 2 representatives (a Palo Alto Councilmember and Los Altos
Councilmember) have both had relevant transportation experience, including local and regional
experience with transportation issues and/or service on the VTA Policy Advisory Committee.
The Palo Alto Councilmember continues to serve as an ex officio member of the VTA Board by
virtue of his role as the Cities Association of Santa Clara County City Selection Committee
representative to the Metropolitan Transportation Commission. In addition, both recent Group
2 appointees either served two terms on the VTA Board or are expected to do so, consistent
with Resolution No. 2022-01.
Civil Grand Jury Recommendation 6:
VTA Board Appointing Authority Groups 2 through 5 should certify to the VTA Board that they
will adhere to VTA Administrative Code (Section 2-14) admonitions, regarding Board member
expertise and appointment to consecutive terms.
City of Palo Alto Response to Recommendation 6:
The City of Palo Alto has already implemented this recommendation to the extent it applies to
the City and other Group 2 cities. Group 2 Cities Working Group Resolution No. 2022-01
complies with VTA Administrative Code section 2-14. Information regarding the two most
recent Group 2 appointees to the VTA Board is provided in the City’s response to Finding No. 6.
No further report to the VTA Board is required.
Civil Grand Jury Finding 7:
VTA Board Appointing Authority Groups 2 through 5 have different processes for making Board
Appointments.
City of Palo Alto Response to Finding 7:
The City of Palo Alto agrees with this finding. The VTA Administrative Code allows members of
VTA Board Groups 2 through 5 to determine the process for appointing their respective Board
members. The Administrative Code allows each group to have a different process. While Palo
Alto lacks first-hand knowledge of the appointment processes for Groups 3 through 5, publicly
available sources indicate that not all of the groups use the same process that Palo Alto and
other Group 2 cities use to appoint their VTA Board members.
Civil Grand Jury Recommendation 7:
The cities represented in Appointing Authority Groups 2 through 5 should agree on a uniform
process for making Board appointments.
City of Palo Alto Response to Recommendation 7:
This recommendation will not be implemented by the City of Palo Alto, because Palo Alto does
not have authority over the VTA or other VTA members. However, Palo Alto and other Group 2
cities currently comply with VTA Administrative Code section 2-14. The City of Palo Alto remains
open to discussing a uniform process for making Board appointments, consistent with the VTA
Administrative Code.
Sincerely,
______________________________
Vicki Veenker
Mayor
Enclosure