BILL ANALYSIS Ó AB 730 Page 1 CONCURRENCE IN SENATE AMENDMENTS AB 730 (Alejo) As Amended September 3, 2013 Majority vote ----------------------------------------------------------------- |ASSEMBLY: |49-23|(May 16, 2013) |SENATE: |27-11|(September 9, | | | | | | |2013) | ----------------------------------------------------------------- Original Committee Reference: TRANS . SUMMARY : Expands the Monterey-Salinas Transit District's (MST) authority to issue revenue bonds. The Senate amendments clarify that any bonds issued to acquire equipment must be for a duration that does not exceed the useful life of the equipment. EXISTING LAW : 1)Creates MST with specified powers and duties relative to providing transit services in the Monterey region. 2)Authorizes MST to issues revenue bonds under the Revenue Bond Law of 1941, payable from revenue of any facility or enterprise of MST. 3)Authorizes MST to temporarily borrow money in accordance with various provisions of the Government Code applicable to local agencies. 4)Establishes Caltrans to, among other responsibilities, manage the state highway system (which includes the California freeway and expressway system) and provide funding and coordination of intercity rail passenger services within the state. 5)Designates the Transportation Agency of Monterey County as the state designated regional transportation planning agency to perform transportation planning activities for the County and Cities of Monterey County. FISCAL EFFECT : None. This bill is keyed non-fiscal by the Legislative Counsel. AB 730 Page 2 COMMENTS : This bill expands the ability of MST to issue revenue bonds directly by bypassing certain provisions of the Revenue Bond Law of 1941, especially the requirement to secure voter approval for the issuance of revenue bonds. Instead, the bill authorizes MST to issue revenue bonds subject to a two-thirds vote of the MST board. Many other metropolitan transit districts, such as Orange County Transit District, San Diego County Regional Transportation Commission, and San Francisco Bay Area Rapid Transit District, already possess similar means of issuing bonds directly without approval by the local voters. This bill is patterned after legislation enacted last year that provided similar authority to the Sacramento Regional Transit District. Additionally, this bill updates MST's array of temporary borrowing tools allowing it to pledge revenues or other moneys available to it from any source, including a transactions and use tax, as payment of the revenue bonds. The author claims that "Monterey County does not have a local sales tax dedicated to public transit purposes and, as a result, MST receives far less local tax support and is more dependent upon state and federal sources than its peers." Further, he indicates that one-third of their bus fleet is operating beyond their federally-designated "useful life," and that their maintenance facilities are similarly operating beyond the original design capacities and are in need of upgrade or replacement in order to meet growing demands for transit within the community. He believes that this bill will provide MST similar authority granted to other transit districts and provide MST with greater flexibility in utilizing bond debt to raise required capital funds for infrastructure and transit equipment, such as buses. Related bills : AB 1143 (Dickinson), Chapter 537, Statutes of 2011, allowed the Sacramento Regional Transit District to issue revenue bonds with a two-thirds vote of its board. AB 644 (Caballero), Chapter 460, Statutes of 2009; created the MST. Analysis Prepared by : Janet Dawson / TRANS. / (916) 319-2093 AB 730 Page 3 FN: 0002404