BILL ANALYSIS Ó
AB 1070
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Date of Hearing: April 22, 2013
ASSEMBLY COMMITTEE ON TRANSPORTATION
Bonnie Lowenthal, Chair
AB 1070 (Frazier) - As Amended: April 3, 2013
SUBJECT : California Transportation Financing Authority
SUMMARY : Makes clarifying changes to provisions governing the
California Transportation Financing Authority (CTFA).
Specifically, this bill :
1)Defines "issuer" to mean CTFA when it is issuing bonds or the
project sponsor when CTFA has granted the project sponsor
authority to issue bonds.
2)Clarifies which of the existing powers and responsibilities
resides with the bond issuer, whether that be CTFA or the
project sponsor, including provisions requiring the issuer to:
a) Comply with relevant statutes applicable to planning,
programming, and construction of transportation improvement
projects;
b) Cooperate with the California Department of
Transportation(Caltrans) to secure support for the project
and to ensure that the project is consistent with the needs
of the state highway system; and,
c) Ensure the project is technically feasible and conforms
to federal standards and meets environmental requirements.
3)Make several technical, conforming changes to related
provisions.
EXISTING LAW :
1)Defines key terms related to CTFA, most notably "project" to
include all or a portion of planning, design, development,
finance, construction, reconstruction, rehabilitation,
improvement, acquisition, lease, operation, or maintenance of
a highway, public street, rail, or related facility.
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2)Defines "project sponsor" to mean Caltrans, a regional
transportation planning agency, a county transportation
commission, a statutorily designated regional transportation
agency, a joint exercise of powers authority, or an agency
designated to submit a county transportation plan.
3)Defines CTFA membership to include:
a) The State Treasurer, who will serve as CTFA chair;
b) The Director of the Department of Finance;
c) The State Controller;
d) The Caltrans Director;
e) The Executive Director of the California Transportation
Commission (CTC);
f) A local agency representative appointed by the Senate
Committee on Rules; and,
g) A local agency representative appointed by the Speaker
of the Assembly.
4)Explicitly states that the objective of CTFA is to increase
the construction of new capacity or improvements for the state
transportation system in a manner that is consistent with the
state's greenhouse gas reduction goals, air quality
improvement goals, and natural resources conservation goals,
through the issuance of revenue bonds.
5)Grants CTFA broad authorities to secure project financing.
6)Provides that project sponsors may pledge the following
revenue sources as security for revenue bonds issued by CTFA:
local transportation funds, fuel taxes, Article XIX B fuel
sales taxes, local transportation sales taxes, developer fees,
tolls, and other state revenues approved for these purposes by
the Legislature or by initiative.
7)Ensures Caltrans and CTC approve the use of any state funds a
local transportation agency pledges to a project.
8)Authorizes project sponsors to apply to CTFA for bond
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financing for approved transportation projects and requires
CTFA to ensure the following specific requirements have been
met, to the extent these requirements have not already been
met through approval of the project by CTC:
a) The project complies with all relevant statutes
applicable to planning, programming, and construction of
transportation improvement projects and is contained in the
constrained portion of a regional transportation plan;
b) The project sponsor has secured Caltrans support for the
project;
c) The project conforms to design standards and
environmental requirements and has all necessary permits to
enable its construction;
d) The project is financially feasible;
e) Project performance measures have been developed;
f) The project has community support, demonstrated in part
by public notice and a public review period; and,
g) The project sponsor of a highway project has
demonstrated how transit service or alternative modes of
transportation will be enhanced by the project.
9)Explicitly provides that CTFA will not have the power to plan
or approve projects, other than project financing, as provided
for in this bill.
10)Requires the CTC to report annually on the status of projects
funded using the authority granted by this bill.
11)Grants CTFA authority to authorize a project sponsor to
collect tolls if a project meets certain criteria.
FISCAL EFFECT : Unknown
COMMENTS : CTFA was created by AB 798 (Nava), Chapter 474,
Statutes of 2009, to provide alternative financing mechanisms
for state, regional, and transportation agencies to finance
transportation projects. Specifically, CTFA is vested with
authority to issue or approve the issuance of revenue bonds to
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finance transportation projects, as defined, that meet certain,
specified criteria. CTFA may also authorize a project sponsor
to impose and collect tolls as one source of revenue to pay debt
service and to operate and maintain a project, under certain
conditions.
Beginning June 30, 2011, and annually thereafter, CTFA is
required to provide to the CTC a summary of actions taken in the
previous calendar year, including the number of project sponsors
who sought financing through CTFA, a description of each
project, a summary of the sources of funding used to finance or
refinance the project, and any recommendations CTFA may have to
improve the financing of transportation infrastructure. Since
enactment of AB 798, CTFA has not received a formal request for
financing or refinancing a project.
One of the specific powers granted to CTFA is the ability to
authorize a project sponsor the power to issue bonds. However,
some of the provisions in CTFA's enabling statutes are not clear
as to whom certain bond issuance powers and responsibilities
reside, particularly in cases where CTFA might grant a project
sponsor the authority to issue bonds.
This bill will make technical changes within existing
authorities and responsibilities to clarify that specific
authorities provided for in statute may apply to whoever issues
bonds, be it CTFA or the project sponsor.
Writing in support of AB 1070, this bill's sponsor, State
Treasurer Bill Lockyer, asserts the technical clarifications
being made in the bill will "increase the likelihood that CTFA
can better reduce traffic congestion and meets its mission of
improving the state transportation system in ways that will help
achieve the state's greenhouse gas reduction, air quality
improvement, and natural resource conservation goals without
compromising financial viability."
Related legislation : AB 886 (Allen) establishes a five-year,
$500 million tax credit program, to be administered by CTFA, for
importers and exporters that increase cargo through California
air and sea ports, hire additional staff, or incur capital costs
at a California cargo facility. The bill is currently in the
Assembly Revenue and Taxation Committee.
SB 810 (Price), which is similar to AB 886, authorizes CTFA to
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create processes and procedures necessary to award up to $100
million in tax credit certificates per year between 2014 and
2018 to qualifying importers and exporters. That bill is
currently in the Senate Transportation and Housing Committee.
REGISTERED SUPPORT / OPPOSITION :
Support
State Treasurer Bill Lockyer (sponsor)
Opposition
None on file
Analysis Prepared by : Janet Dawson / TRANS. / (916) 319-2093