Why not use the money to make bus service better? There is no city that can't effectively use many more buses. Bus riders all put service as their biggest problem over the cost.
Improving service is much better, but the relative scales here are crazy. She options are "completely eliminate cost" or "slightly improve service in one two-mile stretch". Granted, 10 million trips a year go through that two-mile stretch that was improved, but that's just a small fraction of all bus trips in SF.
It is more than that, but even still we should as that would help the people who ride their routes. In almost all cases this would bring in more riders who find the new service good enough that they can stop driving.