BILL ANALYSIS Ó AB 2250 Page 1 CONCURRENCE IN SENATE AMENDMENTS AB 2250 (Daly) As Amended June 26, 2014 Majority vote ----------------------------------------------------------------- |ASSEMBLY: |78-0 |(May 15, 2014) |SENATE: |32-0 |(August 20, | | | | | | |2014) | ----------------------------------------------------------------- Original Committee Reference: TRANS. SUMMARY : Requires any revenue generated from a managed lane that is administered by a local agency on a state highway to be used in the corridor in which it was generated. The Senate amendments recast the bill's provisions to provide greater clarity. FISCAL EFFECT : According to the Senate Appropriations Committee, pursuant to Senate Rule 28.8, negligible state costs. COMMENTS : Managed lanes - particularly high occupancy toll (HOT) lanes - are increasingly being implemented in metropolitan areas around the state and the nation. HOT lanes allow single-occupant or lower-occupant vehicles to use an HOV lane for a fee, while maintaining free or reduced travel to qualifying HOVs. The purported benefits of HOT lanes include enhanced mobility and travel options in congested corridors and better usage of underutilized HOV lanes. California is currently in the embryonic stage of what is sure to be a substantial build out of HOT lanes around the state in the very near future. The Metropolitan Transportation Commission, for example, is in the midst of developing a regional HOT lane network that will extend for hundreds of miles from Sonoma County in the north to Gilroy in the south. How these lanes are managed and operated will likely depend on efforts currently underway within the Administration to develop managed lane policies. One of these efforts began last year as part of the Governor's proposed budget. In it, he directed the California State Transportation Agency (CalSTA) to convene a workgroup consisting AB 2250 Page 2 of state and local transportation stakeholders to refine the transportation infrastructure needs assessment; explore long-term, pay-as-you-go funding options, and evaluate the most appropriate level of government to deliver high-priority investments to meet the state's infrastructure needs. Toward this end, CalSTA released in February of this year its vision and interim recommendations in a report entitled California Transportation Infrastructure Priorities: Vision and Interim Recommendations. Two of the recommendations were: 1)Support efforts to maintain and expand the availability of local funds dedicated to transportation improvements, albeit with conditions; and, 2)Work with the Legislature to expand the department's use of pricing and express lanes to better manage congestion and the operation of the state highway system while generating new revenues for preservation and other corridor improvements. Discussions with stakeholders during development of this report raised concerns that regional transportation agencies may be called upon by the Administration to contribute funding for the state's underfunded highway maintenance program using, in part, revenue generated from managed lanes. Indeed, the state's highway maintenance program is underfunded. Funding to pay for most maintenance and repair on the state highway system comes from taxes on gasoline and diesel fuel. Revenue from these taxes is declining because of reduced fuel consumption and funding shortfalls in the Federal Highway Trust Fund. The projected funding available for the preservation of state highway infrastructure is estimated at $1.8 billion annually. However, the need for the rehabilitation and reconstruction of the state highway system is about $7 billion annually. Regional transportation agencies have been much more successful in funding transportation improvements, primarily from self-imposed sales taxes for transportation. These self-help counties contribute over $3 billion annually in sales tax revenue to California's transportation systems. Increasingly, these agencies are using, or plan to use, sales tax revenues to fund development of managed lanes to improve the performance of major highway corridors. Revenue generated by managed lanes is used to cover costs associated with debt service, operations, AB 2250 Page 3 maintenance, and law enforcement of the managed lanes. Any excess revenue is typically returned to the corridor from which it is generated by way of increased transit service or highway improvements. Existing law does not currently provide specific additional authority to develop HOT lanes (although there is limited authority to develop tolled facilities under provisions authorizing public-private partnerships). However, as the Administration is currently looking to develop a broader managed lane program, the author introduced this bill to ensure that the state's managed lane policies and practices strike an appropriate balance between the roles of the California Department of Transportation (Caltrans) and local agencies, including the need to ensure revenue generated by managed lanes stays in the transportation corridor from which it was generated. This policy is consistent with the Legislature's previous specific HOT lane authorizations. Writing in support of this bill, the Self-Help Counties Coalition (SHCC) asserts that its member agencies - local county transportation agencies charged with delivering voter-approved transportation sales tax measures - develop managed lanes to help address the state's transportation needs. SHCC contends that decisions over revenue allocation and tolling policies need to rest with the agency assuming the project development, construction, and financing risk and should remain available for expenditure by the local agency in the respective corridor. Related legislation: SB 983 (Ed Hernandez) of the current legislative session, extends indefinitely the California Transportation Commission's authority to approve regional transportation agencies' applications to develop and operate HOT lanes and expands the authority to include applications submitted by the Caltrans. The bill is in the Assembly Appropriations Committee. SB 1298 (Ed Hernandez) of the current legislative session, repeals and recasts specific authority for the Los Angeles County Metropolitan Transportation Authority to operate a value-pricing and transit development program including HOT lanes on State Routes 10 and 110. Analysis Prepared by : Janet Dawson / TRANS. / (916) 319-2093 AB 2250 Page 4 FN: 0004337