BILL ANALYSIS Ó
SENATE TRANSPORTATION & HOUSING COMMITTEE BILL NO: sb 557
SENATOR MARK DESAULNIER, CHAIRMAN AUTHOR: hill
VERSION: 2/22/13
Analysis by: Eric Thronson FISCAL: yes
Hearing date: April 30, 2013
SUBJECT:
San Francisco Bay Area high-speed rail expenditures
DESCRIPTION:
This bill reiterates a number of restrictions contained in
existing law related to bond funds that the Legislature
appropriated for the development of high-speed rail in the San
Francisco Bay Area.
ANALYSIS:
Existing law created the California High-Speed Rail Authority
(HSRA) in 1996 to direct development and implementation of
inter-city high-speed rail service that is fully coordinated
with other public transportation services. In 2008, voters
approved Proposition 1A (Prop 1A) authorizing $9.95 billion in
general obligation bonds for the project. The Legislature
appropriates bond funds for expenditure and the bond act
includes requirements for reporting and expenditure of bond
funds.
Prop 1A set aside $950 million in bond funds for capital
improvements to intercity, urban, and commuter rail that provide
direct connectivity to high-speed rail, while Prop 1A dedicates
the remaining $9 billion specifically to high-speed rail
projects.
In 2012, the Legislature passed SB 1029 (Committee on Budget and
Fiscal Review), Chapter 152, which appropriated the state bond
and federal funds necessary to award the design-build
construction contracts for the first segment of the high-speed
rail project. SB 1029 also appropriated $1.1 billion in bond
funds for investment in the "bookend" segments of the system
located in the northern and southern California regions. SB
1029 included extensive reporting requirements and expenditure
restrictions. With respect to the appropriation for projects in
the "bookend" segments, SB 1029 contains a number of
SB 557 (HILL) Page 2
restrictions, including:
Making funds available only for improvements consistent with
the memorandums of understanding (MOUs) approved prior to the
appropriation between HSRA and the local partners.
Prohibiting funds dedicated to the San Francisco-to-San Jose
Peninsula corridor from being used to expand the project
beyond the agreed-upon "blended system" with existing commuter
rail service or to build a four-track system.
Requiring HSRA to enter into a project management and funding
agreement with the local sponsor of the project.
Subjecting expenditures to audits to affirm HSRA spent them in
accordance with established criteria and existing agreements.
Making funds available for encumbrance or liquidation
until June 30, 2018.
This bill reiterates a number of restrictions contained in
existing law related to bond funds that the Legislature
appropriated for the development of high-speed rail in the San
Francisco Bay Area. Specifically, restrictions in this bill
include:
Making funds available only for improvements consistent with
the memorandums of understanding (MOUs) approved prior to the
appropriation between HSRA and the local partners.
Prohibiting funds dedicated to the San Francisco-to-San Jose
Peninsula corridor from being used to expand the project
beyond the agreed-upon "blended system" with existing commuter
rail service or to build a four-track system.
Requiring approval from all nine parties of the Bay Area MOU
to expand beyond the blended system planned for the Peninsula
corridor.
COMMENTS:
1.Purpose . According to the author, this bill closes potential
loopholes to make sure that funds cannot be transferred from
the San Francisco Peninsula segment to other segments of the
high-speed rail system. In addition, the bill clarifies that
appropriated funds will be used solely to implement the
negotiated two-track blended system on the Peninsula.
Finally, the author contends this bill provides a critical
safeguard against expansion of the shared system by requiring
HSRA to obtain approval of any changes from all nine entities
that were party to the original MOU involving the Peninsula
segment. These protections are important because of the level
of mistrust of HSRA that exists with Bay Area Peninsula
SB 557 (HILL) Page 3
residents and communities.
2.What does this bill accomplish ? All of the protections in
this bill already either explicitly exist or are implied in
current law. Provisions connected to state budget
appropriations remain attached to the funds as long as the
funds are available for expenditure and cannot be changed or
adjusted without new legislation. Therefore, the restrictions
contained in SB 1029 will govern the high-speed rail
funds provided to the "bookend" segments unless the
Legislature passes and the governor signs a bill stating
otherwise. It is unclear what this bill accomplishes, except
reiterating current restrictions on appropriated funds.
3.Sunset date . As noted above, the funds appropriated in SB
1029 for the "bookend" projects are available until June 30,
2018. The committee may wish to amend this bill to add a
sunset date so this language does not remain in statute beyond
its applicability.
POSITIONS: (Communicated to the committee before noon on
Wednesday, April 24,
2013.)
SUPPORT: City of San Carlos
City of Palo Alto
Mayor of Redwood City
Peninsula Corridor Joint Powers Authority
(Caltrain)
San Mateo Transit District
San Mateo Transportation Authority
OPPOSED: None received.