BILL ANALYSIS Ó SB 1298 Page 1 SENATE THIRD READING SB 1298 (Ed Hernandez) As Amended June 17, 2014 Majority vote SENATE VOTE :31-0 TRANSPORTATION 12-1 APPROPRIATIONS 15-1 ----------------------------------------------------------------- |Ayes:|Lowenthal, Linder, |Ayes:|Bigelow, Bocanegra, | | |Achadjian, Bloom, Bonta, | |Bradford, | | |Buchanan, Daly, Frazier, | |Ian Calderon, Campos, | | |Nazarian, Patterson, | |Donnelly, Eggman, Gomez, | | |Quirk-Silva, Waldron | |Holden, Jones, Linder, | | | | |Pan, Quirk, | | | | |Ridley-Thomas, Wagner | | | | | | |-----+--------------------------+-----+--------------------------| |Nays:|Gatto |Nays:|Gatto | | | | | | ----------------------------------------------------------------- SUMMARY : Repeals and recasts specific authority for the Los Angeles County Metropolitan Transportation Authority (LACMTA) to operate a value-pricing and transit development program (program) including high-occupancy toll (HOT) lanes on State Route (SR) 10 and SR 110. Specifically, this bill : 1)Repeals LACMTA's authority to operate a value-pricing and transit development demonstration program on SR 10 and SR 110 involving HOT lanes; instead, recasts authority for LACMTA to conduct, administer, and operate the program indefinitely and generally under the same terms and conditions that governed the demonstration program. 2)Requires agreements between LACMTA, California Department of Transportation (Caltrans), and California Highway Patrol to provide for reimbursement to the state agencies from toll revenues, or other funding sources that are not otherwise available to state agencies for transportation-related projects, for costs incurred in connection with implementation or operation of the HOT lanes and for maintenance of state highway facilities related to the HOT lanes. SB 1298 Page 2 3)Explicitly authorizes, pursuant to an expenditure plan adopted by LACMTA, all remaining revenue to be used in the corridor in which it was generated for preconstruction, construction, and other related costs of High Occupancy Vehicles (HOV) facilities, transportation corridor improvements, and improved transit service in the corridor. 4)Directs LACMTA to continue to work with affected communities to provide mitigation measures for commuters of low income, including reduced toll charges and toll credits for transit users. 5)Grants LACMTA authority to issue revenue bonds related to the program. FISCAL EFFECT : According to the Assembly Appropriations Committee, Caltrans indicates that the two HOT lanes have generated nearly $17 million in toll revenue in the first 10 months of operation. Under its agreement with LACMTA, Caltrans is reimbursed for its associated operational and maintenance expenditures. COMMENTS : This bill sets forth provisions to govern LACMTA's HOT lanes going forward after its successful demonstration period. These provisions generally mirror the original demonstration program and reflect similar statutory authority granted to other transportation agencies to develop and operate HOT lanes. There are some notable differences, however, between the authorities granted in this bill versus the demonstration program. For example, provisions specifically related to the start-up of the demonstration program are not included in the ongoing authority provided for in this bill, such as requirements for public outreach, communication plans, and public hearings. However, this bill still requires LACMTA to work with affected communities to provide ongoing mitigation measures for commuter of low income, including reduced tolls and toll credits for transit users. Furthermore, this bill explicitly provides that LACMTA has the authority to continue to require HOVs to use an electronic toll tag for enforcement purposes and would allow LACMTA to change the minimum occupancy standard for free access to the HOT lane. This bill deviates from other HOT lane statutes in that it specifically authorizes the use of toll revenues to pay for transportation corridor improvements, including improvements that may or may not be directly linked to the HOT lane facility so long as the improvements are in the same corridor as the HOT lane. This SB 1298 Page 3 bill further deviates from established HOT lane parameters in that it requires LACMTA to reimburse Caltrans for maintenance of HOT lane facilities. The issue of using HOT lane revenue to pay for state highway maintenance is generating increasingly hearty debates between state and regional transportation agencies. Some have suggested that the state is entitled to a share of HOT lane revenues as a "return on its investment" in the state highway system. Revenues received from HOT lanes could be applied to the state's woefully underfunded maintenance program. The Self-Help Counties Coalition (SHCC) takes a different, although not necessarily mutually exclusive view. SHCC asserts that decisions over revenue allocation should rest with the agency assuming the project development, construction, and financing risk. (In this bill, that agency is LACMTA.) Although SHCC suggests that local and regional agencies should work with Caltrans to ensure corridor system management tools such as tolls are used effectively, any amount of revenue dedicated to maintenance of adjacent general purpose lanes, for example, should be determined by the regional agency, albeit in consultation with Caltrans. There is no opposition to this bill concerning the continuation of LACMTA's ExpressLanes. (The Department of Finance expressed opposition to provisions in an earlier version of the bill that have since been deleted.) Related legislation: AB 2250 (Daly) of the current legislative session, requires any revenue generated in managed lanes to be used in the corridor in which it was generated. AB 2250 is on the Senate Third Reading. SB 983 (Ed Hernandez) of the current legislative session, provides regional transportation agencies the opportunity to apply to the CTC for approval to operate HOT lanes. SB 983 is in Assembly Appropriations Committee. Previous legislation: SB 1422 (Ridley-Thomas), Chapter 547, Statutes of 2008, authorized LACMTA's value-pricing and transit development demonstration project. Analysis Prepared by : Janet Dawson / TRANS. / (916) 319-2093 FN: 0004491 SB 1298 Page 4