Gov. Gavin Newsom announced Wednesday that the state would work with struggling Bay Area transit systems on short-term financial help to keep them afloat while talks on a $750 million loan from the state continue.

In a press release on Wednesday, Newsom said the transit assistance would be in the "hundreds of millions of dollars" and that the Department of Finance and the California State Transportation Agency would work with transit agencies and regional partners to design structured loans or financing mechanisms.

Newsom's statement hinted that the state is seeking a measure of oversight on how the funds are spent and how the loans would be repaid, saying that the financing would "align with operational needs, protect service, and support fiscal reforms, with clear and reliable repayment plans."

Earlier this week, state Sens. Scott Wiener (D-San Francisco) and Jesse Arreguín (D-Berkeley) said the Department of Finance informed them it would not finalize the details of the previously announced $750 million bridge loan for transit agencies before the end of the legislative session on Friday. Without the funding, BART, San Francisco Muni, AC Transit and Caltrain were each looking at massive cuts in service.

On Tuesday, officials said the talks on the state's financial assistance loan were extended until Jan. 10, 2026. 

"Transit is a lifeline to millions of Californians - and after billions in state investment, we're continuing to back Bay Area agencies with ongoing support tailored to their needs," said Newsom in a prepared statement. "We'll keep partnering with them now and into next year - aligning flexible financing tools to their timelines - so we can deliver a sustainable, rider-first transit system together."  

The details of the "loans or other mechanisms" announced by Newsom were not immediately available. The Governor's Office said the administration 'will continue to evaluate options to ensure assistance remains responsive to agencies' stated needs and strengthens the long-term financial stability of Bay Area transit."

A spokesman for the Governor's Office told CBS News Bay Area that the ongoing discussions would determine the specific amount and mechanism.  

Arreguín and Wiener have authored a ballot measure, State Senate Bill 63, that is designed to provide a long-term funding source for Bay Area transit agencies facing a "fiscal cliff" following the pandemic and the end of pandemic relief funding. SB 63 would authorize a regional sales tax in Alameda, Contra Costa, and San Francisco counties and allow Santa Clara and San Mateo and to opt in. 

The half-cent tax increase would generate hundreds of millions of dollars annually to support transit systems' operating needs. San Francisco would have the option to seek a higher rate, up to one cent, for additional support for the Muni system.