Transit-Oriented Community Development Threatened in MTC Policy Update
Urgent update 11/18/25:
At the end of October, at a Metropolitan Transportation Commission (MTC) workshop, commissioners took a deep dive into two linked efforts that will shape the Bay Area’s growth for decades to come: implementation of the Transit-Oriented Communities (TOC) Policy and development of the next One Bay Area Grant program (OBAG 4) which is set to provide approximately $200 million in funding for regional transportation and housing projects per year over the next four years.
Transform joined coalition partners from across the region to speak in strong support of keeping the TOC Policy intact and ensuring that local compliance remains tied to regional funding. While the workshop was purely informational, the discussion offered a preview of the debate to come when the commissioners vote on the OBAG 4 framework early next year.
A turning point for the region’s housing and climate goals
The Transit-Oriented Communities Policy is the engine behind the Plan Bay Area 2050 vision of affordable and connected communities. It asks cities and counties to plan for more homes and jobs near transit, adopt tenant protections, reform parking requirements, and improve station access. Together, these four components — density, housing, parking, and station access — form a framework to cut greenhouse gas emissions, reduce driving, and enable people of all incomes to live near opportunity.
Yet, as staff described at the workshop, local governments have pushed back on both the pace and complexity of compliance. Smaller jurisdictions cited limited capacity and resources; others objected to density and parking standards they view as unrealistic in the current market. In response, MTC staff have proposed a shift toward an “incentive-based” scoring system that awards partial credit to jurisdictions that show progress, even if they haven’t yet adopted TOC policies. See the slides below from MTC staff for the proposed changes, how municipalities may be scored, and then linked to OBAG 4 funds for the example “Bay City.”
Other proposed changes would grant full points for “work in progress” and reduce the weighting of certain parking and density standards. Meeting these standards will truly reduce vehicle miles traveled (VMT), an area in which the region is already struggling to meet its targets year after year.
These adjustments may seem technical, but they matter. Weakening one pillar of the TOC Policy undermines the entire structure. The elements are designed to complement one another, and they carry enough weight to meet the ambitious goals of Plan Bay Area only when they work together.
Why MTC’s TOC policy matters
At Transform, we’re making advocacy around the TOC Policy a priority campaign because it touches on our core values: expanding the availability of affordable housing and building infill housing near transit as a climate remedy.
Specifically:
- It connects housing, climate, and transportation goals. The TOC Policy turns the vision of Plan Bay Area 2050 into reality by encouraging more homes near transit and fewer long car commutes.
- It centers equity. The policy’s housing menu supports the “3Ps” framework — production, preservation, and protection — ensuring residents can stay in their communities as they grow.
- It links funding to accountability. By tying OBAG dollars to local compliance, MTC can make sure regional funds reward cities that are moving toward shared goals.
Mixed messages from MTC
During public comment, Transform and partner organizations representing affordable housing, environmental, and community-based groups urged MTC to maintain the integrity of the TOC framework and keep OBAG 4 funding linked to full policy compliance.
Commissioners’ reactions reflected the range of opinions in the room. Several expressed support for the staff’s partial-credit proposal or questioned the inclusion of tenant protection policies altogether. Others — including Commissioners Schaaf, Fleming, and Jean-Baptiste — spoke up to correct misinformation, emphasizing that the TOC does not mandate rent control and that Plan Bay Area 2050 relies on widespread TOC implementation to meet climate targets. The debate revealed both the stakes and the persistent misunderstanding of what the TOC Policy is designed to do: reward jurisdictions that plan responsibly, not punish those that don’t.
Transform’s perspective: stay strong, stay aligned
From our vantage point, the partial-credit scheme risks turning years of planning into a scoring exercise rather than real progress on housing, equity, and climate. MTC cannot meet its own greenhouse gas reduction and affordability targets if it signals that half measures are enough. Linking OBAG 4 funding eligibility to TOC compliance is not a penalty; it is a fair and effective way to ensure scarce regional dollars support communities moving toward California’s climate goals.
Transform’s strategic plan calls for advancing equitable, climate-smart growth that centers the voices of historically underinvested communities. The TOC Policy embodies that vision. As we detailed in our blog, Linking Growth to Regional Goals, and our Parking Revolution: Housing Solution report, aligning funding, housing, and transportation decisions is essential to building thriving, affordable neighborhoods near transit. Diluting the TOC requirements now would undo that progress and erode public trust in regional planning.
What’s next
MTC is expected to vote in January 2026 on the OBAG 4 framework, which will determine how federal transportation dollars are distributed across the Bay Area and whether TOC compliance remains part of that equation. Between now and then, MTC committees will continue refining the framework and responding to stakeholder feedback.
Transform will remain deeply engaged in that process, working alongside partners to ensure that the TOC Policy delivers on its promise: affordable homes near transit, strong tenant protections, and fewer car-dependent commutes.
This is the moment for commissioners to stand by the commitments they made in 2022 and keep the TOC strong, equitable, and accountable to the goals of Plan Bay Area 2050+.
