BILL NUMBER: AB 1501	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Patterson

                        JANUARY 13, 2014

   An act to add Section 185036.2 to the Public Utilities Code,
relating to high-speed rail.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1501, as introduced, Patterson. High-speed rail.
   Existing law creates the High-Speed Rail Authority with specified
powers and duties relating to the development and implementation of
an intercity high-speed rail system. Existing law, pursuant to the
Safe, Reliable High-Speed Passenger Train Bond Act for the 21st
Century, authorizes $9.95 billion in general obligation bonds for
high-speed rail development and other related purposes. The federal
American Recovery and Reinvestment Act of 2009 (ARRA) and other
federal acts provide funding for allocation nationally to high-speed
rail projects. The Budget Act of 2012 appropriates federal funds, and
state funds in the High-Speed Passenger Train Bond Fund, to the
authority for various purposes related to the high-speed rail
project, including right-of-way acquisition and construction.
   This bill would prohibit the authority from expending the federal
funds appropriated to the authority pursuant to the Budget Act of
2012 unless state funds appropriated from the High-Speed Passenger
Train Bond Fund or from another state funding source are immediately
available to the authority for the purpose of providing matching
state funds for the federal funds. This requirement would apply
regardless of whether the federal government has authorized the
expenditure of the federal funds without the immediate availability
of the nonfederal match that is a condition for the award of the
federal funds. The bill would also make legislative findings and
declarations.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  The Legislature finds and declares all of the
following:
   (a) When voters approved Proposition 1A on November 4, 2008, they
authorized the state to issue $9.95 billion in general obligation
bonds and expend the proceeds for the construction of a 520-mile
high-speed rail system between San Francisco and Los Angeles/Anaheim.
In the official title and summary approved by the Legislature,
voters were promised that the only cost to the state's General Fund
would be "to pay bond principal and interest."
   (b) Neither the Legislature nor the voters have approved the
direct expenditure of state General Fund dollars for high-speed rail
construction.
   (c) On July 6, 2012, the Legislature enacted SB 1029 (Chapter 152
of the Statutes of 2012), amending the 2012-13 Budget Act to
appropriate $4.7 billion in state bond funds and $3.3 billion in
federal high-speed rail funds to initiate high-speed rail
construction. Under an agreement with the federal government, the
federal funds require state matching funds. It was the intent of the
Legislature in enacting SB 1029 that the appropriated state bond
funds would be used to provide this match.
   (d) On August 16, 2013, a Sacramento Superior Court judge ruled
that the High-Speed Rail Authority had not yet met the legal
requirements to access and spend Proposition 1A bond funds for
high-speed rail construction.
   (e) In its October 11, 2013, response, the High-Speed Rail
Authority did not dispute this finding, but argued that, even if it
cannot access or spend Proposition 1A bond funds, it can proceed with
construction using federal funds. Because federal funds must be
matched with state funds, the authority argued that other sources of
state funds, including, but not limited to, the state's General Fund,
can be used to fulfill this matching requirement.
   (f) This course of action enables the High-Speed Rail Authority to
unilaterally obligate the state to provide more than $3 billion in
state resources toward high-speed rail construction that may
otherwise be designated for purposes such as education, health care,
or public safety, without any prior review or approval by the
Legislature.
   (g) It is the intent of the Legislature in enacting this act to
ensure that, if the High-Speed Rail Authority cannot legally spend
state matching funds appropriated by the Legislature, it may not
obligate the state to provide additional sources of state funds that
have not yet been appropriated by the Legislature.
  SEC. 2.  Section 185036.2 is added to the Public Utilities Code, to
read:
   185036.2.  The authority may not expend the federal funds
appropriated to the authority pursuant to Chapter 152 of the Statutes
of 2012 unless state funds appropriated from the High-Speed
Passenger Train Bond Fund or from another state funding source are
immediately available to the authority for the purpose of providing
matching state funds for the federal funds. This requirement shall
apply regardless of whether the federal government has authorized the
expenditure of the federal funds without the immediate availability
of the nonfederal match that is a condition for the award of the
federal funds.