BILL ANALYSIS �
Senate Appropriations Committee Fiscal Summary
Senator Kevin de Le�n, Chair
AB 481 (Lowenthal) - High-Speed Rail Authority: property
management.
Amended: June 12, 2013 Policy Vote: T&H 8-2
Urgency: No Mandate: No
Hearing Date: July 1, 2013 Consultant: Mark McKenzie
This bill does not meet the criteria for referral to the
Suspense File.
Bill Summary: AB 481 would provide the High-Speed Rail Authority
(HSRA) with independent authority to manage property acquired
for high-speed rail purposes, similar to the independent
authority provided to the Department of Transportation
(Caltrans), rather than performing these functions through the
Department of General Services (DGS). Specifically, this bill
would:
Specify that the high-speed rail project is under the control
of the HSRA rather than Caltrans.
Authorize HSRA to acquire, grant access to, and quitclaim
easements and rights-of-way (ROW) on property owned or being
acquired by the state.
Authorize HSRA to sell property no longer needed for
high-speed rail purposes at fair market value to an adjacent
property owner, a local agency, or former owner, as specified.
The property could also be exchanged for other property
needed for high-speed rail purposes.
Authorize HSRA to lease non-operating ROW to local agencies
for public purposes, or lease areas above or below operating
and non-operating ROW to public or private entities, as
specified.
Authorize HSRA to secure fire insurance for property leased
back to a former owner for commercial or business uses, as
specified.
Require any revenues derived from granting access to ROW,
selling property, and leasing ROW to public and private
entities to be deposited into a new High-Speed Rail Property
Fund, and available to HSRA, upon appropriation by the
Legislature, for use on the high-speed rail system, as
specified.
Fiscal Impact:
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Potential overall high-speed rail project savings, to the
extent that DGS would be relieved of administrative
oversight duties related to HSRA property management
functions (High-Speed Passenger Train Bond Fund). While the
bill would increase costs to HSRA staff to handle property
management duties, these costs would likely be more than
offset by savings related to removing these additional
administrative requirements, and the revenue gains noted
below.
Unknown revenue gains related to the authority granted to
HSRA to sell, exchange, and lease specified property to
public and private entities (High-Speed Rail Property Fund).
These funds would be used for future development,
improvement, and maintenance of the high-speed rail system.
Background: Existing law, the Property Acquisition Law,
provides DGS with general authority over all property
acquisition and management duties and responsibilities on behalf
of state agencies. This includes negotiation of leases and
granting of easements, access, and ROW on state-owned property,
as well as disposing of surplus property. Caltrans, the
University of California, the Department of Water Resources and
other large agencies that manage their own larger scale
construction projects are exempt from this body of law and
follow other procedures. Caltrans, for example, has broad
authority over property acquisition and management of state
lands for highway purposes. On the property management side,
Caltrans has independent authority to grant access to its own
ROW, dispose of excess property no longer needed for state
highway purposes, lease property to public agencies, and lease
areas above or below the ROW to public or private entities. All
revenues derived from the management of Caltrans property is
deposited into the State Highway Account.
Existing law created the HSRA in 1996 to direct development and
implementation of intercity high-speed rail service that is
fully coordinated with other public transportation services. In
2008, voters approved Proposition 1A (Prop 1A) authorizing the
sale of $9.95 billion in general obligation bonds for the
high-speed rail project. Prop 1A authorizes HSRA to use bond
funds for, among other things, acquisition of interests in real
property and rights-of-way. Prop 1A also authorizes HSRA to
either contract with Caltrans for right-of-way activities or
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otherwise use DGS processes for right-of-way acquisition
pursuant to the state's public acquisition law.
The HSRA and the Federal Railroad Administration jointly
selected a segment from Madera , north of Fresno, to near
Bakersfield as the first construction segment of the high-speed
rail system. Between federal funds and state bond funds, the
HSRA has committed about $5.9 billion for the initial 130 mile
corridor is Central Valley project. As a condition of the $3.5
billion in ARRA grants for the project, the HSRA must complete
construction on the initial segment by September 30, 2017. HSRA
has received bids for the first of five construction packages in
the corridor and expects to award a contract for the rail line
between Madera and downtown Fresno this summer. The remaining
four construction packages are expected to be awarded in 2014.
Related Legislation: This bill is similar to provisions that
were contained in AB 615 (Lowenthal), as it was passed by this
Committee on August 25, 2011. That bill provided much broader
authority to HSRA, however, by exempting the authority from the
Property Acquisition Law and Public Works Board Oversight. The
provisions providing the HSRA with independent authority over
land acquisition and property management were later amended out
of that bill prior to a vote on the Senate Floor.
Staff Comments: AB 481 would provide the HSRA with certain
authority related to the management and disposal of property,
rights-of way, and easements. Under current law, these
activities generally require the involvement and approval of
DGS, the State Public Works Board (SPWB), or the Department of
Finance (DOF) in order to take certain actions regarding
property or the contracting of professional and construction
services. Caltrans, the University of California, the
Department of Water Resources and other large agencies that
manage their own larger scale construction projects are exempt
from this body of law and follow other procedures. This bill
would provide the HSRA with a limited set of the exemptions that
are provided to these other agencies, specifically those related
to the management and disposition of property, but not those
related to the acquisition of that property. Those functions
related to property acquisition, including any eminent domain
proceedings, would be retained by DGS and the SPWB.
HSRA indicates that any new property management duties related
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to the bill could be managed by their existing right-of-way
staff. In addition to six PY of existing staff dedicated to
property services, HSRA was recently granted an additional five
PY to support right-of-way acquisition and preservation
activities. In the absence of this bill, these HSRA staff would
work through DGS for any property management activities. To the
extent that this bill relieves DGS of oversight and
administrative responsibilities related to property management
responsibilities, there would be corresponding savings.
AB 481 specifies that funds derived from the sale, lease, or
grant of interest in HSRA property would be deposited in the
High-Speed Rail Property Fund for use in the development,
improvement, and maintenance of the high-speed rail system, upon
appropriation by the Legislature. The amount of revenue that
could be deposited into the fund is unknown at this time, but
would include any revenues from the sale or exchange of property
that is no longer necessary for the project, sale or lease of
excess parcels to local agencies for public purposes, lease of
nonoperating right-of-way to local agencies for public purposes,
and lease of areas above or below operating rights-of-way to
public agencies or private entities or individuals, as
specified.