BILL NUMBER: AB 1171 CHAPTERED
BILL TEXT
CHAPTER 907
FILED WITH SECRETARY OF STATE OCTOBER 14, 2001
APPROVED BY GOVERNOR OCTOBER 14, 2001
PASSED THE ASSEMBLY SEPTEMBER 15, 2001
PASSED THE SENATE SEPTEMBER 14, 2001
AMENDED IN SENATE SEPTEMBER 14, 2001
AMENDED IN SENATE SEPTEMBER 14, 2001
AMENDED IN SENATE SEPTEMBER 7, 2001
AMENDED IN SENATE AUGUST 20, 2001
AMENDED IN ASSEMBLY MAY 22, 2001
AMENDED IN ASSEMBLY MAY 9, 2001
AMENDED IN ASSEMBLY MAY 3, 2001
INTRODUCED BY Assembly Member Dutra
FEBRUARY 23, 2001
An act to amend Sections 188.5 and 31010 of, to add Section 188.51
to, to repeal Section 31050 of, and to add Chapter 4.6 (commencing
with Section 31070) to Division 17 of, the Streets and Highways Code,
relating to highways, and making an appropriation therefor.
LEGISLATIVE COUNSEL'S DIGEST
AB 1171, Dutra. Highways: toll bridges: funding.
(1) Existing law imposes a seismic retrofit surcharge equal to $1
per vehicle for passage on the state-owned toll bridges in the region
within the area of the jurisdiction of the Metropolitan
Transportation Commission, except for vehicles that are authorized
toll-free passage on those bridges. Revenue generated from the
surcharge is required to be deposited in the Toll Bridge Seismic
Retrofit Account in the State Transportation Fund, which is
continuously appropriated without regard to fiscal years to the
Department of Transportation for the purpose of funding seismic
retrofit of currently listed bridges. The department is required to
determine the date when (a) sufficient funds have been generated for
the completion of seismic retrofit and the replacement of the San
Francisco-Oakland Bay Bridge, as specified, and (b) sufficient funds
have been generated to pay for any costs added under a specified
provision relating to the San Francisco-Oakland Bay Bridge. The
department is required to notify the Secretary of State of that date,
immediately upon making that determination. These provisions are
repealed on January 1, 2008, or on the date the Secretary of State
receives the specified notice, whichever occurs first.
This bill would delete the repeal date described above and would
instead provide a repeal date occurring when the California
Transportation Commission notifies the Secretary of State that
sufficient funds have been generated to meet certain obligations, as
defined, and thereby would make an appropriation by extending the
time during which the money in the account would be continuously
appropriated. The bill would require the money in the account that
is in excess of those funds needed to meet the toll commitment and
other elements requiring to meet the obligations of the department's
financial plan to be available to the Bay Area Toll Authority for
funding certain purposes and projects that are consistent with
existing law requirements.
The bill would require the department to transfer the funds
annually to the authority upon receiving notification from the
authority's governing board.
The bill would prohibit the increase in tolls beyond the level
needed to complete the seismic retrofit and replacement of bay area
bridges, as described above, unless the California Infrastructure and
Economic Development Bank makes certain described findings and the
Department of Finance confirms those findings.
(2) Existing law sets forth the cost estimates at $2,620,000,000
to retrofit the state-owned toll bridges and to replace the east span
of the San Francisco-Oakland Bay Bridge in accordance with a
schedule.
This bill would revise that cost estimate to $4,637,000,000 and
would correspondingly revise the schedule.
(3) Existing law provides that the estimated cost of replacing the
east span of the San Francisco-Oakland Bay Bridge is based on
certain assumptions.
The bill would instead provide that this estimated cost is based
on specific conditions, rather than assumptions.
(4) Existing law provides that it is the intent of the Legislature
that specific amounts from various funds be allocated through the
2004-05 fiscal year, for the seismic retrofit or replacement of the
identified state-owned toll bridges.
This bill would require the continued allocation of the funds
until expended, rather than through the 2004-05 fiscal year, and
would revise the amount available from the seismic retrofit
surcharge, subject to certain limitations, and would include the
funds necessary to meet principal obligations, as defined, of not
less than $642,000,000 from the state's share of the federal Highway
Bridge Replacement and Rehabilitation Program.
The bill would revise the proportional reduction of funding
formula provided under existing law, if the cost of retrofitting or
replacement, or both, is less than the statutory cost estimate set
forth above.
The bill would require the department, upon substantial completion
of the retrofit work of the state-owned toll bridges, to submit a
final report prepared by an independent accounting firm identifying
the sources and use of the funds. The bill would require the report
to serve as the basis for any proportional reduction in funding as
described above.
The bill would provide that if the department issues federal
highway grant anticipation notes to fund the retrofitting of state
owned toll bridges and the replacement of the east span of the San
Francisco-Oakland Bay Bridge, certain adjustments in the state
transportation improvement program county share shall not apply.
The bill would authorize the department to enter into certain
financial arrangements to finance or refinance the seismic retrofit
project costs which would include the issuance of revenue bonds.
The bill would provide that nothing in the bill shall be construed
to negatively impact any project that is programmed prior to January
1, 2002, in the state transportation improvement program.
Appropriation: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 188.5 of the Streets and Highways Code is
amended to read:
188.5. (a) The Legislature finds and declares all of the
following:
(1) The department has determined that in order to provide maximum
safety for the traveling public and to ensure continuous and
unimpeded operation of the state's transportation network, six
state-owned toll bridges are in need of a seismic safety retrofit,
and one state-owned toll bridge is in need of a partial retrofit and
a partial replacement.
(2) The bridges identified by the department as needing seismic
retrofit are the Benicia-Martinez Bridge, the Carquinez Bridge, the
Richmond-San Rafael Bridge, the San Mateo-Hayward Bridge, the San
Pedro-Terminal Island Bridge (also known as the Vincent Thomas
Bridge), the San Diego-Coronado Bridge, and the west span of the San
Francisco-Oakland Bay Bridge. The department has also identified the
east span of the San Francisco-Oakland Bay Bridge as needing to be
replaced. That replacement span will be safer, stronger, longer
lasting, and more cost efficient to maintain than completing a
seismic retrofit for the current east span.
(3) The south span of the Carquinez Bridge is to be replaced
pursuant to Regional Measure 1, as described in subdivision (b) of
Section 30917.
(4) The cost estimate to retrofit the state-owned toll bridges and
to replace the east span of the San Francisco-Oakland Bay Bridge is
four billion six hundred thirty-seven million dollars
($4,637,000,000), as follows:
(A) The Benicia-Martinez Bridge retrofit is one hundred ninety
million dollars ($190,000,000).
(B) The north span of the Carquinez retrofit is one hundred
twenty-five million dollars ($125,000,000).
(C) The Richmond-San Rafael Bridge retrofit is six hundred
sixty-five million dollars ($665,000,000).
(D) The San Mateo-Hayward Bridge retrofit is one hundred ninety
million dollars ($190,000,000).
(E) The San Pedro-Terminal Island Bridge retrofit is sixty-two
million dollars ($62,000,000).
(F) The San Diego-Coronado Bridge retrofit is one hundred five
million dollars ($105,000,000).
(G) The west span of the San Francisco-Oakland Bay Bridge
retrofit, as a lifeline bridge, is seven hundred million dollars
($700,000,000).
(H) Replacement of the east span of the San Francisco-Oakland Bay
Bridge is two billion six hundred million dollars ($2,600,000,000).
(b) It is the intent of the Legislature that the following amounts
from the following funds shall be allocated until expended, for the
seismic retrofit or replacement of state-owned toll bridges:
(1) Six hundred fifty million dollars ($650,000,000) from the 1996
Seismic Retrofit Account in the Seismic Retrofit Bond Fund of 1996
for the seven state-owned toll bridges identified by the department
as requiring seismic safety retrofit or replacement.
(2) One hundred forty million dollars ($140,000,000) in surplus
revenues generated under the Seismic Retrofit Bond Act of 1996 that
are in excess of the amount actually necessary to complete Phase Two
of the state's seismic retrofit program. These excess funds shall be
reallocated to assist in financing seismic retrofit of the
state-owned toll bridges.
(3) Fifteen million dollars ($15,000,000) from the Vincent Thomas
Toll Bridge Revenue Account.
(4) The funds necessary to meet both of the following:
(A) A principal obligation of two billion two hundred eighty-two
million dollars ($2,282,000,000) from the seismic retrofit surcharge,
including any interest therefrom, imposed pursuant to Section 31010,
subject to the limitation set forth in subdivision (c) and
subdivision (b) of Section 31010.
(B) All costs of financing, including capitalized interest,
reserves, costs of issuance, costs of credit enhancements and any
other financial products necessary or desirable in connection
therewith, and any other costs related to financing.
(5) Thirty-three million dollars ($33,000,000) from the San
Diego-Coronado Toll Bridge Revenue Fund.
(6) Not less than seven hundred forty-five million dollars
($745,000,000) from the State Highway Account to be used toward the
eight hundred seventy-five million dollars ($875,000,000) state
contribution, to be achieved as follows:
(A) (i) Two hundred million dollars ($200,000,000) to be
appropriated for the state-local transportation partnership program
described in paragraph (7) of subdivision (d) of Section 164 for the
1998-99 fiscal year.
(ii) The remaining funds intended for that program and any program
savings to be made available for toll bridge seismic retrofit.
(B) A reduction of not more than seventy-five million dollars
($75,000,000) in the funding level specified in paragraph (4) of
subdivision (d) of Section 164 for traffic system management.
(C) Three hundred million dollars ($300,000,000) in accumulated
savings by the department achieved from better efficiency and lower
costs.
(7) Not more than one hundred thirty million dollars
($130,000,000) from the Transit Capital Improvement Program funded by
the Transportation Planning and Development Account in the State
Transportation Fund to be used toward the eight hundred seventy-five
million dollars ($875,000,000) state contribution. If the
contribution in subparagraph (A) of paragraph (6) exceeds three
hundred seventy million dollars ($370,000,000), it is the intent that
the amount from the Transit Capital Improvement Program shall be
reduced by an amount that is equal to that excess.
(8) (A) The funds necessary to meet principal obligations of not
less than six hundred forty-two million dollars ($642,000,000) from
the state's share of the federal Highway Bridge Replacement and
Rehabilitation (HBRR) Program.
(B) If the project costs exceed four billion six hundred
thirty-seven million dollars ($4,637,000,000), the department may
program not more than four hundred forty-eight million dollars
($448,000,000) in project savings or other available resources from
the Interregional Transportation Improvement Plan, the State Highway
Operation Protection Plan, or federal bridge funds for that purpose.
(C) None of the funds identified in subparagraph (B) may be
expended for any purpose other than the conditions and design
features described in paragraph (9).
(9) The estimated cost of replacing the San Francisco-Oakland Bay
Bridge listed in subparagraph (H) of paragraph (4) of subdivision (a)
is based on the following conditions:
(A) The new bridge shall be located north adjacent to the existing
bridge and shall be the Replacement Alternative N-6 (preferred)
Suspension Structure Variation, as specified in the Final
Environmental Impact Statement, dated May 1, 2001, submitted by the
department to the Federal Highway Administration.
(B) The main span of the bridge shall be in the form of a single
tower cable suspension design and shall be the Replacement
Alternative N-6 (preferred) Suspension Structure Variation, as
specified in the Final Environmental Impact Statement, dated May 1,
2001, submitted by the department to the Federal Highway
Administration.
(C) The roadway in each direction shall consist of five lanes,
each lane will be 12 feet wide, and there shall be 10-foot shoulders
as an emergency lane for public safety purposes on each side of the
main-traveled way.
(c) If the actual cost of retrofit or replacement, or both
retrofit and replacement, of toll bridges is less than the cost
estimate of four billion six hundred thirty-seven million dollars
($4,637,000,000), there shall be a reduction in the amount provided
in paragraph (4) of subdivision (b) equal to the proportion of total
funds committed to complete the projects funded from funds generated
from paragraph (4) of subdivision (b) as compared to the total funds
from paragraphs (6), (7), and (8) of subdivision (b), and there shall
be a proportional reduction in the amount specified in paragraph (8)
of subdivision (b).
(d) (1) The department shall report annually to the Legislature
and the Governor as to the amount of funds used for that purpose from
each source specified in subdivision (b) and submit an updated cost
estimate. Upon substantial completion of the seismic retrofit work
of the state-owned toll bridges, the department shall submit a final
report, prepared by an independent accounting firm, identifying the
sources and uses of the funds. That report shall serve as the basis
for any proportional reduction in funding as specified in subdivision
(c).
(2) If the department determines that the actual costs exceed the
amounts identified in subparagraph (B) of paragraph (8) of
subdivision (b), the department shall report to the Legislature
within 90 days from the date of that determination as to the
difference and the reason for the increase in costs.
(e) Notwithstanding any other provision of law, the commission
shall adopt fund estimates consistent with subdivision (b) and
provide flexibility so that state funds can be made available to
match federal funds made available to regional transportation
planning agencies.
(f) For the purposes of this section, "principal obligations" are
the amount of funds generated, either in cash, obligation authority,
or the proceeds of a bond or other indebtedness.
SEC. 2. Section 188.51 is added to the Streets and Highways Code,
to read:
188.51. (a) If the department utilizes its authority under
Chapter 4 (commencing with Section 14550) of Part 5.3 of Division 3
of the Government Code to issue federal highway grant anticipation
notes (GARVEE Bonds) from the state share of federal obligation
authority to fund the projects identified in subdivision (a) of
Section 188.5, Section 14553.6 of the Government Code shall not
apply.
(b) State expenditures for the purposes of subdivision (a) shall
not exceed 5 percent of the annual amount of federal obligation
authority received by the state for a period determined by the
department.
SEC. 3. Section 31010 of the Streets and Highways Code is amended
to read:
31010. (a) There is hereby imposed a seismic retrofit surcharge
equal to one dollar ($1) per vehicle for passage on the bay area
bridges, except for vehicles that are authorized toll-free passage on
these bridges.
(b) Funds generated by subdivision (a) may not be used to repay
nontoll revenues committed to fund projects identified in paragraph
(2) of subdivision (a) of Section 188.5. Following the date of the
submission of the final report required in subdivision (d) of Section
188.5, funds generated pursuant to subdivision (a) that are in
excess of those needed to meet the toll commitment as specified by
paragraph (4) of subdivision (b) of Section 188.5, including annual
debt service payments, if any, required to support the commitment,
and other elements required to meet the obligations of the department'
s financing plan, shall be available to the authority for funding,
consistent with Sections 30913 and 30914, the purposes and projects
described in those sections. The department shall transfer to the
authority on an annual basis the funds made available to the
authority under this subdivision upon receiving notification from the
authority that the governing board of the authority has passed a
resolution, by majority vote, requesting that transfer.
(c) There shall be no increase in tolls beyond the level
identified in subdivision (a) for the purposes identified in
paragraph (4) of subdivision (a) of Section 188.5, except that the
department shall have the authority to increase the seismic retrofit
surcharge for debt service purposes only if the bank finds and the
Department of Finance confirms that both of the following apply:
(1) Extraordinary circumstances exist that jeopardize the payment
of debt service for which toll revenues are authorized, and all other
financial resources for meeting toll commitments have been
exhausted.
(2) Bonds issued under Chapter 4.3 (commencing with Section 30950)
shall not be impaired solely by action taken under this section, as
evidenced by confirmation of the then existing ratings on those
bonds, by the rating agencies then rating the bonds.
(d) The department shall extend the term of the financing plan
developed under Section 31071, for the purposes of funding the
projects described in Sections 30913 and 30914, for a period of not
more than 30 years commencing on January 1, 2008, if both of the
following conditions apply:
(1) The authority submits a request for the extension to the
department on or before October 15, 2001, or on a later date
requested by the authority and approved by the director.
(2) The Director of Transportation determines that the extension
would satisfy the financial requirements of the federal Department of
Transportation.
(e) This section shall remain in effect only until the date that
the California Transportation Commission notifies the Secretary of
State that sufficient funds have been generated to meet the
obligations identified in paragraph (4) of subdivision (b) of Section
188.5, and repayment of any outstanding debt secured by tolls, and
as of that date is repealed. The California Transportation
Commission shall provide the notice described in this subdivision
upon making the determination set forth in this subdivision.
SEC. 4. Section 31050 of the Streets and Highways Code is
repealed.
SEC. 5. Chapter 4.6 (commencing with Section 31070) is added to
Division 17 of the Streets and Highways Code, to read:
CHAPTER 4.6. STATE-OWNED TOLL BRIDGE SEISMIC RETROFIT
FINANCING ACT OF 2001
31070. The Legislature hereby finds and declares all of the
following:
(a) Following the 1989 Loma Prieta earthquake, legislation was
enacted to make seismic safety a top transportation priority in this
state. In the wake of the Northridge earthquake of 1994, when nine
major freeway bridges were destroyed and 11 major highways wee
closed, seismic retrofit of the state's bridges and highways again
became the number one priority on the state's transportation agenda.
(b) In 1996, voters approved Proposition 192, a two billion dollar
($2,000,000,000) bond measure for state highway seismic retrofit.
This funding measure includes the costs of retrofitting seven
state-owned toll bridges, five in the San Francisco-Oakland Bay area
and two in southern California. Replacement costs for the eastern
span of the San Francisco-Oakland Bay Bridge were factored in as
well.
(c) Subsequent to the adoption of Proposition 192, new cost
estimates by the department increase the toll bridge retrofit program
from six hundred fifty million dollars ($650,000,000) to two billion
six hundred million dollars ($2,600,000,000). To address this
increase, the Legislature enacted legislation in 1997, establishing
the compromise of a 50/50 funding agreement between the state and
local toll payers to finance all state-owned bridges in the San
Francisco-Oakland Bay area, Los Angeles, and San Diego.
(d) It is the further intent of the Legislature that the
department address the funding deficiency through a combination of
financing options. These options may or may not include obtaining a
loan under the federal Transportation Infrastructure Finance and
Innovation Act of 1998 (P.L. 105-178), a program authorized by the
Congress of the United States in 1998 to provided credit assistance
for large transportation projects.
(e) Other financing options include revenue bonds and commercial
paper should be issued under the authority of the California
Infrastructure and Economic Development Financing Bank, the
California Transportation Commission, or other, appropriate entity.
31070.5. For the purposes of this chapter, the following terms
have the following meanings, unless the context requires otherwise:
(a) "Authority" means the Bay Area Toll Authority established
under Section 30950.
(b) "Account" means the Toll Bridge Seismic Retrofit Account
established in the State Transportation Fund under Section 188.12.
(c) "Bank" means the California Infrastructure and Economic
Development Bank established under Section 63021 of the Government
Code.
(d) "Bay area bridges" means the state-owned toll bridges in the
region within the area of the jurisdiction of the Metropolitan
Transportation Commission.
(e) "Bonds" has the meaning defined in subdivision (e) of Section
63010 of the Government Code.
(f) "Department" means the Department of Transportation.
(g) "TIFIA" means the federal Transportation Infrastructure
Finance and Innovation Act of 1998 (P.L. 105-178).
(h) "Toll surcharge" means the seismic retrofit surcharge imposed
under Section 31010.
31070.7. The department has full and sole responsibility for
completion of all seismic retrofit projects on the bay area bridges.
31071. (a) The department may enter into financing agreements
with the bank for the purpose of borrowing funds to finance or
refinance the seismic retrofit project costs identified in paragraph
(4) of subdivision (a) of Section 188.5. The bank may issue bonds
for this purpose, pursuant to the authority granted to it under
Chapter 5 (commencing with Section 63070) of Chapter 2 of Division 1
of Title 6.7 of the Government Code, and deposit the proceeds from
the bonds into the account. The amount of borrowing may be increased
to fund necessary reserves, capitalized interest, interim bonds,
including, but not limited to, commercial paper, costs of issuance,
and administrative, financial legal and incidental services related
to the bonds. The department shall pursue the most cost-effective
and efficient financing plan for the bridge work identified in
paragraph (4) of subdivision (a) of Section 188.5.
(b) To the extent provided in the governing documents, each of the
bonds issued under this section shall be payable from, and secured
by, all or a portion of the toll surcharge revenue in the account and
the assets in that account.
(c) Prior to the issuance of bonds payable from the toll
surcharge, the bank shall confirm that bonds issued under Chapter 4.3
(commencing with Section 30950) shall not be impaired solely by
action taken under this section, as evidenced by confirmation of the
then existing ratings on these bonds, by the rating agencies then
rating the bonds.
31071.3. Notwithstanding any other provision of law, during the
construction period, all revenues generated from the toll surcharge
shall be available to the department only for the construction and
financing purposes of the toll bridge seismic retrofit program.
31071.5. (a) Bonds issued under this chapter may not be deemed to
constitute a debt or liability of the state or of any political
subdivision thereof, other than the bank, or a pledge of the faith
and credit of the state or of any political subdivision thereof, but
shall be payable solely from the account, and the assets of the
account, and the security provided by the account. All bonds issued
under this chapter shall contain on the face of the bonds a statement
to this effect.
(b) Notwithstanding any other provision of law, Article 3
(commencing with Section 63040) of, Article 4 (commencing with 63042)
of, and Article 5 (commencing with Section 63043) of Chapter 2 of
Division 1 of Title 6.7 of the Government Code do not apply to any
financing provided by the bank to, or at the request of, the
department in connection with the account.
31072. Any federal funds received by the department as a direct
loan or line of credit under TIFIA are hereby appropriated to the
department for transfer to the account for the purposes of that
account.
31073. The department may make the loans and transfers authorized
under Section 14556.7 of the Government Code and Section 188.14 to
provide adequate cash flow for obligation service requirements
resulting from the financing authority provided under Sections 31071
and 31072.
SEC. 6. This act shall not be construed to negatively impact any
project that is programmed prior to January 1, 2002, in the state
transportation improvement program.