BILL ANALYSIS Ó
SENATE TRANSPORTATION & HOUSING COMMITTEE BILL NO: SB 1037
SENATOR MARK DESAULNIER, CHAIRMAN AUTHOR: hernandez
VERSION: 3/24/14
Analysis by: Eric Thronson FISCAL: no
Hearing date: April 29, 2014
SUBJECT:
Measure R project cost estimates
DESCRIPTION:
This bill requires the Los Angeles County Metropolitan
Transportation Authority (LACMTA) to update its expenditure plan
and Long-Range Transportation Plan (LRTP) before presenting
another measure before the voters.
ANALYSIS:
In order to efficiently plan the state's near-term
transportation expenditures, existing law requires regional
transportation planning agencies to adopt, every odd-numbered
year, a five-year regional transportation improvement plan
containing all projects funded with state and federal dollars.
These fiscally constrained plans are derived from regional
transportation planning efforts identifying long-term
transportation needs based on forecasted population growth and
addressing mobility needs. The long-term regional
transportation plans are not fiscally constrained, which means
they include many more projects than there is likely to be
resources available to build.
In the region overseen by the Southern California Association of
Governments (SCAG), which includes the counties of Imperial, Los
Angeles, Orange, Riverside, San Bernardino, and Ventura, each
county develops and adopts its own transportation plan and then
submits that plan to SCAG for consolidation. The LACMTA adopted
its LRTP in 2009, which includes projects for which it has
identified funding as well as unfunded projects for future
consideration. In developing its 2009 LRTP, LACMTA designated
and partnered with nine subregions within Los Angeles County
that identified their own transportation needs and priorities to
be included in the LRTP.
SB 1037 (HERNANDEZ) Page 2
Existing law permits a county board of supervisors to create a
countywide transportation authority to plan and fund
transportation projects within the county. These transportation
authorities may impose a local sales tax for transportation
purposes, if the tax ordinance is within statutory limits and
abides by restrictions on local taxes contained in the
California Constitution. Counties that have chosen to tax
themselves for transportation purposes call themselves
"self-help" counties because they have approved measures to help
themselves address their own transportation problems.
In 2008, the Legislature passed and the governor signed AB 2321
(Feuer), Chapter 302, which authorized LACMTA to place before
the voters an ordinance to increase the local transportation
sales tax for 30 years by 0.5% in Los Angeles County. The
statute required LACMTA to adopt an expenditure plan prior to
submitting the ordinance to the voters, and identified 18
projects to be included in that expenditure plan and in the
LRTP. AB 2321 required LACMTA to include in the expenditure
plan the anticipated completion date for each project. In
November 2008, LACMTA placed the sales tax ordinance, referred
to as Measure R, on the ballot and 67% of the voters approved
the measure.
At the time voters approved Measure R, LACMTA estimated that the
30-year program would raise about $40 billion. Because of the
recession and general economic malaise that followed that vote,
LACMTA adjusted its revenue estimates downward and now only
expects the sales tax measure to generate about $36 billion. To
address this funding shortfall, LACMTA began a search for
additional revenue or funding mechanisms to meet its
transportation needs. In 2012, the Legislature passed and the
governor signed AB 1446 (Feuer), Chapter 806, which authorized
LACMTA to place before the voters an ordinance to either
eliminate or extend Measure R's 30-year sunset date. The
measure, put before the voters in November 2012, failed to
achieve the two-thirds majority necessary for passage.
This bill requires LACMTA, prior to submitting another Measure R
extension to the voters, to do the following:
1.Amend its expenditure plan and, for the 18 projects included
in the original Measure R legislation, update the following
information:
The identification or the specific program or source of
SB 1037 (HERNANDEZ) Page 3
non-Measure R funds.
The identification of the accelerated cost, if
applicable, for each project and program.
The expected completion dates for each project and
program.
1.Include in a revised and updated LRTP both the Measure R
expenditure plan and all capital projects adopted and
submitted to LACMTA by each of the nine Los Angeles County
subregions.
COMMENTS:
1.Purpose . According to the author, LACMTA's process for
determining cost estimates for projects in its expenditure
plans is internal, and the agency may or may not solicit
estimates from outside sources. Some have criticized this
process and suggest it results in out-of-date figures and cost
projections. Because of the uncertainty in how LACMTA
determines its estimates, there is general unease between
various subregions in Los Angeles County, and some worry that
one project is being treated more favorably than another
behind the scenes. This bill attempts to bypass efforts by
individual project sponsors to increase their own share of
funding by instituting a transparent method for determining
cost estimates in which subregions submit their own updated
estimates to LACMTA.
2.So what does this bill do ? Given the problem identified by
the author - the potentially questionable cost estimates in
the expenditure plan - it is unclear how this bill provides
resolution. It appears this bill either (1) puts into statute
actions LACMTA already takes, such as including the expected
completion dates for each project in the expenditure plan, or
(2) requires information from LACMTA that may be difficult or
impossible to obtain, such as the specific source of
non-Measure R funds necessary for completion of each of the
projects. While the bill requires LACMTA to update
accelerated costs, if any, it does not require updated cost
estimates for all projects. If the author wishes to resolve
the stated problem, then the bill should be amended to require
LACMTA to update the cost estimates of every project in the
expenditure plan through a transparent process. The bill may
also be amended to remove elements of the bill that do not
address the problem. In light of this, the committee may wish
to amend the bill to reflect a solution to the stated problem
SB 1037 (HERNANDEZ) Page 4
of unclear cost estimates for all projects in the expenditure
plan.
3.Updating the LRTP . As stated earlier, LACMTA includes both
projects with identified funding and unfunded projects in its
LRTP. This bill requires LACMTA to include in a revised and
updated LRTP all capital projects adopted and submitted to
LACMTA by each of the nine subregions. It is unclear,
however, whether including these projects presupposes that
each would therefore become a funded project. The committee
may wish to amend the bill to clarify that including a project
in the LRTP does not presuppose that the project will be
funded at any particular point in the future.
4.Previous legislation . SB 314 (Murray), Chapter 785, Statutes
of 2003, established a list of projects that LACMTA was to
construct with proceeds from a voter-approved 6.5 year,
-percent sales tax. AB 2321 (Feuer), Chapter 302, Statutes
of 2008, superseded SB 314.
5.Double-referral . The Rules Committee referred this bill to
this committee and to the Governance and Finance Committee.
POSITIONS: (Communicated to the committee before noon on
Wednesday, April 23,
2014.)
SUPPORT: None received.
OPPOSED: None received.