BILL ANALYSIS                                                                                                                                                                                                    Ó



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        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.  









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        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  








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        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









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