BILL ANALYSIS �
SENATE TRANSPORTATION & HOUSING COMMITTEE BILL NO: AB 730
SENATOR MARK DESAULNIER, CHAIRMAN AUTHOR: alejo
VERSION: 4/1/2103
Analysis by: Eric Thronson FISCAL: no
Hearing date: June 18, 2013
SUBJECT:
Monterey-Salinas Transit District revenue bonds
DESCRIPTION:
This bill authorizes the Monterey-Salinas Transit District to
approve with a two-thirds vote of its governing board the
issuance of up to $50 million in revenue bonds.
ANALYSIS:
The Revenue Bond Law of 1941 (RBL) establishes uniform
procedures for public agencies in California to use when issuing
revenue bonds. The RBL specifies the various agencies that may
issue revenue bonds, defines the terms of revenue bond
covenants, and enumerates a variety of other conditions related
to revenue bond issuance. In addition, the RBL establishes
procedures for approving the issuance of revenue bonds,
including requiring a majority vote of the governing board to
place a measure on the ballot and a two-thirds vote of the
electorate within a special district's area of jurisdiction.
In 2009, AB 644 (Caballero), Chapter 460, dissolved the
Monterey-Salinas Transit Agency and created the Monterey-Salinas
Transit District (MST). Among the powers AB 644 granted to MST
was the authority to issue revenue bonds under the RBL.
In 2011, AB 1143 (Dickinson), Chapter 537, authorized Sacramento
Regional Transit (RT) to issue revenue bonds without a
two-thirds vote of the electorate and instead to issue revenue
bonds with only a two-thirds vote of its governing board.
This bill authorizes MST to approve with a two-thirds vote of
its governing board the issuance of up to $50 million in revenue
bonds, exempting MST from the RBL requirement of placing a bond
measure on the ballot and garnering a two-thirds vote of the
electorate. In addition, this bill restricts MST from using
AB 730 (ALEJO) Page 2
these bond funds on any projects in the former Fort Ord area
except for projects wholly within the State Highway 1
right-of-way or on the Monterey branch rail line. Finally, this
bill includes the purchase of vehicles in the list of projects
eligible for revenue bond funding.
COMMENTS:
1.Purpose . According to the author, this bill allows MST to
more easily and less expensively issue revenue bonds to fund
improvements to its vehicles, equipment, and facilities. The
author contends that MST has real capital needs, as one-third
of MST's full-sized bus fleet is beyond its useful life, and
MST's maintenance facilities are 35 years old and operating
well beyond their original design capacities. Unlike other
counties in the state, Monterey County does not have a local
sales tax dedicated to transportation and therefore is more
dependent upon state and federal revenue sources for support.
The author believes this bill enables MST to issue bonds to
meet their funding needs for safe and efficient operations and
to provide service to their 4.5 million urban customers as
well as regional connections between communities.
2.Other transit agencies have similar provisions . This bill is
not establishing new precedent by allowing MST to issue
revenue bonds with only a governing board vote instead of a
vote of the people. Besides Sacramento's RT, 20 other transit
districts in California have similar provisions, including the
Bay Area Rapid Transit (BART), Orange County Transportation
Authority (OCTA), and the Santa Clara Valley Transportation
Authority (VTA).
3.Transit needs access to resources . The Legislature has
clearly prioritized policies that reduce greenhouse gas
emissions and improve air quality through the passage of bills
like AB 32 (Nunez Pavley), Chapter 488, Statutes of 2006, and
SB 375 (Steinberg), Chapter 728, Statutes of 2008. Many argue
that public transit is a necessary and vital part of the
state's efforts to reduce emissions. But while it works
toward emission reductions, some suggest the Legislature is
failing to provide the resources necessary to accomplish the
desired air quality benefits. This bill gives a local transit
district another tool to use to accomplish its public
transportation aims by enabling it to more efficiently
consider one of many funding mechanisms available to other
districts. At some point the committee may wish to consider
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granting this tool and others to transit districts statewide
in order to help facilitate the Legislature's goals of cleaner
air and more effective public transit.
4.Double-referral . The Rules Committee has referred this bill
to both this committee and the Governance and Finance
Committee. Therefore, if this bill passes this committee, it
will be referred to the Committee on Governance and Finance.
Assembly Votes:
Floor: 49-23
LG: 6-2
Trans: 10-6
POSITIONS: (Communicated to the committee before noon on
Wednesday, June 12,
2013.)
SUPPORT: Monterey-Salinas Transit (sponsor)
City of Salinas
Fort Ord Reuse Authority
Monterey County Board of Supervisors
Transportation Agency for Monterey County
OPPOSED: None received.