California Legislature—2015–16 First Extraordinary Session

Assembly BillNo. 26


Introduced by Assembly Member Frazier

(Principal coauthor: Senator Beall)

August 24, 2016


An act to amend Sections 13975, 14500, 14526.5, and 16965 of, to add Sections 14033, 14526.7, and 16321 to, to add Part 5.1 (commencing with Section 14460) to Division 3 of Title 2 of, and to repeal Section 14534.1 of, the Government Code, to amend Section 39719 of the Health and Safety Code, to amend Section 21080.37 of, and to add Division 13.6 (commencing with Section 21200) to, the Public Resources Code, to amend Section 99312.1 of the Public Utilities Code, to amend Sections 6051.8, 6201.8, 7360, 8352.4, 8352.5, 8352.6, and 60050 of the Revenue and Taxation Code, to amend Sections 183.1, 820.1, 2192, 2192.1, and 2192.2 of, to add Sections 2103.1 and 2192.4 to, and to add Chapter 2 (commencing with Section 2030) to Division 3 of, the Streets and Highways Code, and to add Sections 9250.3, 9250.6, and 9400.5 to the Vehicle Code, relating to transportation, making an appropriation therefor, and declaring the urgency thereof, to take effect immediately.

LEGISLATIVE COUNSEL’S DIGEST

AB 26, as introduced, Frazier. Transportation funding.

(1) Existing law provides various sources of funding for transportation purposes, including funding for the state highway system and the local street and road system. These funding sources include, among others, fuel excise taxes, commercial vehicle weight fees, local transactions and use taxes, and federal funds. Existing law imposes certain registration fees on vehicles, with revenues from these fees deposited in the Motor Vehicle Account and used to fund the Department of Motor Vehicles and the Department of the California Highway Patrol. Existing law provides for the monthly transfer of excess balances in the Motor Vehicle Account to the State Highway Account.

This bill would create the Road Maintenance and Rehabilitation Program to address deferred maintenance on the state highway system and the local street and road system. The bill would require the California Transportation Commission to adopt performance criteria, consistent with a specified asset management plan, to ensure efficient use of certain funds available for the program. The bill would provide for the deposit of various funds for the program in the Road Maintenance and Rehabilitation Account, which the bill would create in the State Transportation Fund, including revenues attributable to a $0.17 per gallon increase in the motor vehicle fuel (gasoline) tax imposed by the bill with an inflation adjustment, as provided, an increase of $38 in the annual vehicle registration fee with an inflation adjustment, as provided, a new $165 annual vehicle registration fee with an inflation adjustment, as provided, applicable to zero-emission motor vehicles, as defined, and certain miscellaneous revenues described in (7) below that are not restricted as to expenditure by Article XIX of the California Constitution.

This bill would annually set aside $200,000,000 of the funds available for the program to fund road maintenance and rehabilitation purposes in counties that have sought and received voter approval of taxes or that have imposed fees, including uniform developer fees, as defined, which taxes or fees are dedicated solely to transportation improvements. These funds would be continuously appropriated for allocation pursuant to guidelines to be developed by the California Transportation Commission in consultation with local agencies. The bill would require $80,000,000 of the funds available for the program to be annually transferred to the State Highway Account for expenditure on the Active Transportation Program. The bill would require $30,000,000 of the funds available for the program in each of 4 fiscal years beginning in 2017-18 to be transferred to the Advance Mitigation Fund created by the bill pursuant to (12) below. The bill would continuously appropriate $2,000,000 annually of the funds available for the program to the California State University for the purpose of conducting transportation research and transportation-related workforce education, training, and development. The bill would require the remaining funds available for the program to be allocated 50% for maintenance of the state highway system or to the state highway operation and protection program and 50% to cities and counties pursuant to a specified formula. The bill would impose various requirements on the department and agencies receiving these funds. The bill would authorize a city or county to spend its apportionment of funds under the program on transportation priorities other than those allowable pursuant to the program if the city’s or county’s average Pavement Condition Index meets or exceeds 80.

The bill would also require the department to annually identify savings achieved through efficiencies implemented at the department and to propose, from the identified savings, an appropriation to be included in the annual Budget Act of up to $70,000,000 from the State Highway Account for expenditure on the Active Transportation Program.

(2) Existing law establishes in state government the Transportation Agency, which includes various departments and state entities, including the California Transportation Commission. Existing law vests the California Transportation Commission with specified powers, duties, and functions relative to transportation matters. Existing law requires the commission to retain independent authority to perform the duties and functions prescribed to it under any provision of law.

This bill would exclude the California Transportation Commission from the Transportation Agency, establish it as an entity in state government, and require it to act in an independent oversight role. The bill would also make conforming changes.

(3) Existing law creates various state agencies, including the Department of Transportation, the High-Speed Rail Authority, the Department of the California Highway Patrol, the Department of Motor Vehicles, and the State Air Resources Board, with specified powers and duties. Existing law provides for the allocation of state transportation funds to various transportation purposes.

This bill would create the Office of the Transportation Inspector General in state government, as an independent office that would not be a subdivision of any other government entity, to ensure that all of the above-referenced state agencies and all other state agencies expending state transportation funds are operating efficiently, effectively, and in compliance with federal and state laws. The bill would provide for the Governor to appoint the Transportation Inspector General for a 6-year term, subject to confirmation by the Senate, and would provide that the Transportation Inspector General may not be removed from office during the term except for good cause. The bill would specify the duties and responsibilities of the Transportation Inspector General and would require an annual report to the Legislature and Governor.

This bill would require the department to update the Highway Design Manual to incorporate the “complete streets” design concept by January 1, 2017.

(4) Existing law provides for loans of revenues from various transportation funds and accounts to the General Fund, with various repayment dates specified.

This bill would require the Department of Finance, on or before September 1, 2016, to compute the amount of outstanding loans made from specified transportation funds. The bill would require the Department of Transportation to prepare a loan repayment schedule and would require the outstanding loans to be repaid pursuant to that schedule, as prescribed. The bill would appropriate funds for that purpose from the Budget Stabilization Account. The bill would require the repaid funds to be transferred, pursuant to a specified formula, to cities and counties and to the department for maintenance of the state highway system and for purposes of the state highway operation and protection program.

(5) The Highway Safety, Traffic Reduction, Air Quality, and Port Security Bond Act of 2006 (Proposition 1B) created the Trade Corridors Improvement Fund and provided for allocation by the California Transportation Commission of $2 billion in bond funds for infrastructure improvements on highway and rail corridors that have a high volume of freight movement and for specified categories of projects eligible to receive these funds. Existing law continues the Trade Corridors Improvement Fund in existence in order to receive revenues from sources other than the bond act for these purposes.

This bill would deposit the revenues attributable to a $0.30 per gallon increase in the diesel fuel excise tax imposed by the bill into the Trade Corridors Improvement Fund. The bill would require revenues apportioned to the state from the national highway freight program established by the federal Fixing America’s Surface Transportation Act to be allocated for trade corridor improvement projects approved pursuant to these provisions.

Existing law requires the commission, in determining projects eligible for funding, to consult various state freight and regional infrastructure and goods movement plans and the statewide port master plan.

This bill would delete consideration of the State Air Resources Board’s Sustainable Freight Strategy and the statewide port master plan and would instead include consideration of the applicable port master plan when determining eligible projects for funding. The bill would also expand eligible projects to include rail landside access improvements, landside freight access improvements to airports, and certain capital and operational improvements.

(6) Existing law requires all moneys, except for fines and penalties, collected by the State Air Resources Board from the auction or sale of allowances as part of a market-based compliance mechanism relative to reduction of greenhouse gas emissions to be deposited in the Greenhouse Gas Reduction Fund. Existing law continuously appropriates 10% of the annual proceeds of the fund to the Transit and Intercity Rail Capital Program and 5% of the annual proceeds of the fund to the Low Carbon Transit Operations Program.

This bill would, beginning in the 2016-17 fiscal year, instead continuously appropriate 20% of those annual proceeds to the Transit and Intercity Rail Capital Program and 10% of those annual proceeds to the Low Carbon Transit Operations Program, thereby making an appropriation.

(7) Article XIX of the California Constitution restricts the expenditure of revenues from taxes imposed by the state on fuels used in motor vehicles upon public streets and highways to street and highway and certain mass transit purposes. Existing law requires certain miscellaneous revenues deposited in the State Highway Account that are not restricted as to expenditure by Article XIX of the California Constitution to be transferred to the Transportation Debt Service Fund in the State Transportation Fund, as specified, and requires the Controller to transfer from the fund to the General Fund an amount of those revenues necessary to offset the current year debt service made from the General Fund on general obligation transportation bonds issued pursuant to Proposition 116 of 1990.

This bill would delete the transfer of these miscellaneous revenues to the Transportation Debt Service Fund, thereby eliminating the offsetting transfer to the General Fund for debt service on general obligation transportation bonds issued pursuant to Proposition 116 of 1990. The bill, subject to a specified exception, would instead require the miscellaneous revenues to be retained in the State Highway Account and to be deposited in the Road Maintenance and Rehabilitation Account.

(8) Article XIX of the California Constitution requires gasoline excise tax revenues from motor vehicles traveling upon public streets and highways to be deposited in the Highway Users Tax Account, for allocation to city, county, and state transportation purposes. Existing law generally provides for statutory allocation of gasoline excise tax revenues attributable to other modes of transportation, including aviation, boats, agricultural vehicles, and off-highway vehicles, to particular accounts and funds for expenditure on purposes associated with those other modes, except that a specified portion of these gasoline excise tax revenues is deposited in the General Fund. Expenditure of the gasoline excise tax revenues attributable to those other modes is not restricted by Article XIX of the California Constitution.

This bill, commencing July 1, 2016, would instead transfer to the Highway Users Tax Account for allocation to state and local transportation purposes under a specified formula the portion of gasoline excise tax revenues currently being deposited in the General Fund that are attributable to boats, agricultural vehicles, and off-highway vehicles. Because that account is continuously appropriated, the bill would make an appropriation.

(9) Existing law, as of July 1, 2011, increases the sales and use tax on diesel and decreases the excise tax, as provided. Existing law requires the State Board of Equalization to annually modify both the gasoline and diesel excise tax rates on a going-forward basis so that the various changes in the taxes imposed on gasoline and diesel are revenue neutral.

This bill would eliminate the annual rate adjustment to maintain revenue neutrality for the gasoline and diesel excise tax rates and would reimpose the higher gasoline excise tax rate that was in effect on July 1, 2010, in addition to the increase in the rate described in paragraph (1).

Existing law, beyond the sales and use tax rate generally applicable, imposes an additional sales and use tax on diesel fuel at the rate of 1.75%, subject to certain exemptions, and provides for the net revenues collected from the additional tax to be transferred to the Public Transportation Account. Existing law continuously appropriates these revenues to the Controller for allocation by formula to transportation agencies for public transit purposes.

This bill would increase the additional sales and use tax on diesel fuel by an additional 3.5%. By increasing the revenues deposited in a continuously appropriated fund, the bill would thereby make an appropriation. The bill would restrict expenditures of revenues from this increase in the sales and use tax on diesel fuel to transit capital purposes and certain transit services and would require a recipient transit agency to comply with certain requirements, including submitting a list of proposed projects to the Department of Transportation, as a condition of receiving a portion of these funds. The bill would require an existing required audit of transit operator finances to verify that these new revenues have been expended in conformance with these specific restrictions and all other generally applicable requirements.

This bill would, beginning July 1, 2019, and every 3rd year thereafter, require the State Board of Equalization to recompute the gasoline and diesel excise tax rates and the additional sales and use tax rate on diesel fuel based upon the percentage change in the California Consumer Price Index transmitted to the board by the Department of Finance, as prescribed.

(10) Existing law requires the Department of Transportation to prepare a state highway operation and protection program every other year for the expenditure of transportation capital improvement funds for projects that are necessary to preserve and protect the state highway system, excluding projects that add new traffic lanes. The program is required to be based on an asset management plan, as specified. Existing law requires the department to specify, for each project in the program the capital and support budget and projected delivery date for various components of the project. Existing law provides for the California Transportation Commission to review and adopt the program, and authorizes the commission to decline and adopt the program if it determines that the program is not sufficiently consistent with the asset management plan.

This bill would add to the program capital projects relative to the operation of those state highways and bridges. The bill would require the commission, as part of its review of the program, to hold at least one hearing in northern California and one hearing in southern California regarding the proposed program. The bill would require the department to submit any change to a programmed project as an amendment to the commission for its approval.

This bill, on and after February 1, 2017, would also require the commission to make an allocation of all capital and support costs for each project in the program, and would require the department to submit a supplemental project allocation request to the commission for each project that experiences cost increases above the amounts in its allocation. The bill would require the commission to establish guidelines to provide exceptions to the requirement for a supplemental project allocation requirement that the commission determines are necessary to ensure that projects are not unnecessarily delayed.

(11) Existing law imposes weight fees on the registration of commercial motor vehicles and provides for the deposit of net weight fee revenues into the State Highway Account. Existing law provides for the transfer of certain weight fee revenues from the State Highway Account to the Transportation Debt Service Fund to reimburse the General Fund for payment of debt service on general obligation bonds issued for transportation purposes. Existing law also provides for the transfer of certain weight fee revenues to the Transportation Bond Direct Payment Account for direct payment of debt service on designated bonds, which are defined to be certain transportation general obligation bonds issued pursuant to Proposition 1B of 2006. Existing law also provides for loans of weight fee revenues to the General Fund to the extent the revenues are not needed for bond debt service purposes, with the loans to be repaid when the revenues are later needed for those purposes, as specified.

This bill, notwithstanding these provisions or any other law, would only authorize specified percentages of weight fee revenues to be transferred from the State Highway Account to the Transportation Debt Service Fund, the Transportation Bond Direct Payment Account, or any other fund or account for the purpose of payment of the debt service on transportation general obligation bonds in accordance with a prescribed schedule and would prohibit the transfer of weight fee revenues from the State Highway Account after the 2020-21 fiscal year. The bill would also prohibit loans of weight fee revenues to the General Fund.

(12) The California Environmental Quality Act (CEQA) requires a lead agency, as defined, to prepare, or cause to be prepared, and certify the completion of, an environmental impact report on a project that it proposes to carry out or approve that may have a significant effect on the environment or to adopt a negative declaration if it finds that the project will not have that effect. CEQA also requires a lead agency to prepare a mitigated negative declaration for a project that may have a significant effect on the environment if revisions in the project would avoid or mitigate that effect and there is no substantial evidence that the project, as revised, would have a significant effect on the environment.

CEQA, until January 1, 2020, exempts a project or an activity to repair, maintain, or make minor alterations to an existing roadway, as defined, other than a state roadway, if the project or activity is carried out by a city or county with a population of less than 100,000 persons to improve public safety and meets other specified requirements.

This bill would extend the above-referenced exemption indefinitely and delete the limitation of the exemption to projects or activities in cities and counties with a population of less than 100,000 persons. The bill would also expand the exemption to include state roadways.

This bill would also establish the Advance Mitigation Program in the Department of Transportation. The bill would authorize the department to undertake mitigation measures in advance of construction of a planned transportation project. The bill would require the department to establish a steering committee to advise the department on advance mitigation measures and related matters. The bill would create the Advance Mitigation Fund as a continuously appropriated revolving fund, to be funded initially from the Road Maintenance and Rehabilitation Program pursuant to (1) above. The bill would provide for reimbursement of the revolving fund at the time a planned transportation project benefiting from advance mitigation is constructed.

(13) Existing federal law requires the United States Secretary of Transportation to carry out a surface transportation project delivery program, under which the participating states assume certain responsibilities for environmental review and clearance of transportation projects that would otherwise be the responsibility of the federal government. Existing law, until January 1, 2017, provides that the State of California consents to the jurisdiction of the federal courts with regard to the compliance, discharge, or enforcement of the responsibilities the Department of Transportation assumed as a participant in this program.

This bill would delete the January 1, 2017, repeal date, thereby extending these provisions indefinitely.

(14) This bill would declare that it is to take effect immediately as an urgency statute.

Vote: 23. Appropriation: yes. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

P9    1

SECTION 1.  

The Legislature finds and declares all of the
2following:

P10   1(a) Over the next 10 years, the state faces a $59 billion shortfall
2to adequately maintain the existing state highway system in order
3to keep it in a basic state of good repair.

4(b) Similarly, cities and counties face a $78 billion shortfall
5over the next decade to adequately maintain the existing network
6of local streets and roads.

7(c) Statewide taxes and fees dedicated to the maintenance of
8the system have not been increased in more than 20 years, with
9those revenues losing more than 55 percent of their purchasing
10power, while costs to maintain the system have steadily increased
11and much of the underlying infrastructure has aged past its expected
12useful life.

13(d) California motorists are spending $17 billion annually in
14extra maintenance and car repair bills, which is more than $700
15per driver, due to the state’s poorly maintained roads.

16(e) Failing to act now to address this growing problem means
17that more drastic measures will be required to maintain our system
18in the future, essentially passing the burden on to future generations
19instead of doing our job today.

20(f) A funding program will help address a portion of the
21maintenance backlog on the state’s road system and will stop the
22growth of the problem.

23(g) Modestly increasing various fees can spread the cost of road
24repairs broadly to all users and beneficiaries of the road network
25without overburdening any one group.

26(h) Improving the condition of the state’s road system will have
27a positive impact on the economy as it lowers the transportation
28costs of doing business, reduces congestion impacts for employees,
29and protects property values in the state.

30(i) The federal government estimates that increased spending
31on infrastructure creates more than 13,000 jobs per $1 billion spent.

32(j) Well-maintained roads benefit all users, not just drivers, as
33roads are used for all modes of transport, whether motor vehicles,
34transit, bicycles, or pedestrians.

35(k) Well-maintained roads additionally provide significant health
36benefits and prevent injuries and death due to crashes caused by
37poorly maintained infrastructure.

38(l) A comprehensive, reasonable transportation funding package
39will do all of the following:

40(1) Ensure these transportation needs are addressed.

P11   1(2) Fairly distribute the economic impact of increased funding.

2(3) Restore the gas tax rate previously reduced by the State
3Board of Equalization pursuant to the gas tax swap.

4(4) Direct increased revenue to the state’s highest transportation
5needs.

6

SEC. 2.  

Section 13975 of the Government Code is amended
7to read:

8

13975.  

There is in the state government the Transportation
9Agency. The agency consists of the Department of the California
10Highway Patrol, thebegin delete California Transportation Commission, theend delete
11 Department of Motor Vehicles, the Department of Transportation,
12the High-Speed Rail Authority, and the Board of Pilot
13Commissioners for the Bays of San Francisco, San Pablo, and
14Suisun.

15

SEC. 3.  

Section 14033 is added to the Government Code, to
16read:

17

14033.  

On or before January 1, 2017, the department shall
18update the Highway Design Manual to incorporate the “complete
19streets” design concept.

20

SEC. 4.  

Part 5.1 (commencing with Section 14460) is added
21to Division 3 of Title 2 of the Government Code, to read:

22 

23PART 5.1.  OFFICE OF THE TRANSPORTATION INSPECTOR
24GENERAL

25

 

26

14460.  

(a) There is hereby created in state government the
27independent Office of the Transportation Inspector General, which
28shall not be a subdivision of any other governmental entity, to
29ensure that the Department of Transportation, the High-Speed Rail
30Authority, the Department of the California Highway Patrol, the
31Department of Motor Vehicles, the State Air Resources Board,
32and all other state agencies expending state transportation funds
33are operating efficiently, effectively, and in compliance with
34applicable federal and state laws.

35(b) The Governor shall appoint, subject to confirmation by the
36Senate, the Transportation Inspector General to a six-year term.
37The Transportation Inspector General may not be removed from
38 office during that term, except for good cause. A finding of good
39cause may include substantial neglect of duty, gross misconduct,
40or conviction of a crime. The reasons for removal of the
P12   1Transportation Inspector General shall be stated in writing and
2shall include the basis for removal. The writing shall be sent to
3the Secretary of the Senate and the Chief Clerk of the Assembly
4at the time of the removal and shall be deemed to be a public
5document.

6

14461.  

The Transportation Inspector General shall review
7policies, practices, and procedures and conduct audits and
8investigations of activities involving state transportation funds in
9consultation with all affected state agencies. Specifically, the
10Transportation Inspector General’s duties and responsibilities shall
11include, but not be limited to, all of the following:

12(a) To examine the operating practices of all state agencies
13expending state transportation funds to identify fraud and waste,
14opportunities for efficiencies, and opportunities to improve the
15data used to determine appropriate project resource allocations.

16(b) To identify best practices in the delivery of transportation
17projects and develop policies or recommend proposed legislation
18enabling state agencies to adopt these practices when practicable.

19(c) To provide objective analysis of and, when possible, offer
20solutions to concerns raised by the public or generated within
21agencies involving the state’s transportation infrastructure and
22project delivery methods.

23(d) To conduct, supervise, and coordinate audits and
24investigations relating to the programs and operations of all state
25transportation agencies with state-funded transportation projects.

26(e) To recommend policies promoting economy and efficiency
27in the administration of programs and operations of all state
28agencies with state-funded transportation projects.

29(f) To ensure that the Secretary of Transportation and the
30Legislature are fully and currently informed concerning fraud or
31other serious abuses or deficiencies relating to the expenditure of
32funds or administration of programs and operations.

33

14462.  

The Transportation Inspector General shall report at
34least annually to the Governor and Legislature with a summary of
35his or her findings, investigations, and audits. The summary shall
36be posted on the Transportation Inspector General’s Internet Web
37site and shall otherwise be made available to the public upon its
38release to the Governor and Legislature. The summary shall
39include, but need not be limited to, significant problems discovered
40by the Transportation Inspector General and whether
P13   1recommendations of the Transportation Inspector General relative
2to investigations and audits have been implemented by the affected
3agencies. The report shall be submitted to the Legislature in
4compliance with Section 9795.

5

SEC. 5.  

Section 14500 of the Government Code is amended
6to read:

7

14500.  

There is inbegin delete the Transportation Agencyend deletebegin insert state governmentend insert
8 a California Transportation Commission.begin insert The commission shall
9act in an independent oversight role.end insert

10

SEC. 6.  

Section 14526.5 of the Government Code is amended
11to read:

12

14526.5.  

(a) Based on the asset management plan prepared
13and approved pursuant to Section 14526.4, the department shall
14prepare a state highway operation and protection program for the
15expenditure of transportation funds for major capital improvements
16that are necessary to preserve and protect the state highway system.
17Projects included in the program shall be limited tobegin delete capitalend delete
18 improvements relative to maintenance, safety,begin insert rehabilitation,end insert and
19begin delete rehabilitationend deletebegin insert operationend insert of state highways and bridges that do not
20add a new traffic lane to the system.

21(b) The program shall include projects that are expected to be
22advertised prior to July 1 of the year following submission of the
23program, but which have not yet been funded. The program shall
24include those projects for which construction is to begin within
25four fiscal years, starting July 1 of the year following the year the
26program is submitted.

27(c) begin insert(1)end insertbegin insertend insertThe department, at a minimum, shall specify, for each
28project in the state highway operation and protection program, the
29capital and supportbegin delete budget, as well as a projected delivery date,end delete
30begin insert budgetend insert for each of the following project components:

begin delete

31(1) Completion of project

end delete

32begin insert(A)end insertbegin insertend insertbegin insertProjectend insert approval and environmental documents.

begin delete

33(2) Preparation of plans,

end delete

34begin insert(B)end insertbegin insertend insertbegin insertPlans,end insert specifications, and estimates.

begin delete

35(3) Acquisition of rights-of-way, including, but not limited to,
36support activities.

end delete
begin insert

37
(C) Rights-of-way.

end insert
begin insert

38
(D) Construction.

end insert
begin insert

P14   1
(2) The department shall specify, for each project in the state
2highway operation and protection program, a projected delivery
3date for each of the following components:

end insert
begin insert

4
(A) Environmental document completion.

end insert
begin insert

5
(B) Plans, specifications, and estimate completion.

end insert
begin insert

6
(C) Right-of-way certification.

end insert
begin delete

7(4)

end delete

8begin insert(D)end insert Start of construction.

9(d) Thebegin delete program shall be submittedend deletebegin insert department shall submit its
10proposed programend insert
to the commission not later than January 31 of
11each even-numbered year. Prior to submittingbegin delete the plan, theend deletebegin insert its
12proposed program, theend insert
department shall make a draft of its
13proposed program available to transportation planning agencies
14for review and comment and shall include the comments in its
15submittal to the commission.begin insert The department shall provide the
16commission with detailed information for all programmed projects,
17including, but not limited to, cost, scope, schedule, and
18performance metrics as determined by the commission.end insert

19(e) The commissionbegin delete mayend deletebegin insert shallend insert review thebegin insert proposedend insert program
20relative to its overall adequacy, consistency with the asset
21management plan prepared and approved pursuant to Section
2214526.4 and funding priorities established in Section 167 of the
23Streets and Highways Code, the level of annual funding needed
24to implement the program, and the impact of those expenditures
25on the state transportation improvement program. The commission
26shall adopt the program and submit it to the Legislature and the
27Governor not later than April 1 of each even-numbered year. The
28commission may decline to adopt the program if the commission
29determines that the program is not sufficiently consistent with the
30asset management plan prepared and approved pursuant to Section
3114526.4.

begin insert

32
(f) As part of the commission’s review of the program required
33pursuant to subdivision (a), the commission shall hold at least one
34hearing in northern California and one hearing in southern
35California regarding the proposed program.

end insert
begin delete

36(f)

end delete

37begin insert(g)end insert Expenditures for these projects shall not be subject to
38Sections 188 and 188.8 of the Streets and Highways Code.

begin insert

39
(h) Following adoption of the state highway operation and
40protection program by the commission, any change to a
P15   1programmed project shall be submitted as an amendment by the
2department to the commission for its approval before the change
3may be implemented.

end insert
4

SEC. 7.  

Section 14526.7 is added to the Government Code, to
5read:

6

14526.7.  

(a) On and after February 1, 2017, an allocation by
7the commission of all capital and support costs for each project in
8the state highway operation and protection program shall be
9required.

10(b) For a project that experiences increases in capital or support
11costs above the amounts in the commission’s allocation pursuant
12to subdivision (a), a supplemental project allocation request shall
13be submitted by the department to the commission for approval.

14(c) The commission shall establish guidelines to provide
15exceptions to the requirement of subdivision (b) that the
16commission determines are necessary to ensure that projects are
17not unnecessarily delayed.

18

SEC. 8.  

Section 14534.1 of the Government Code is repealed.

begin delete
19

14534.1.  

Notwithstanding Section 12850.6 or subdivision (b)
20of Section 12800, as added to this code by the Governor’s
21Reorganization Plan No. 2 of 2012 during the 2011-12 Regular
22Session, the commission shall retain independent authority to
23perform those duties and functions prescribed to it under any
24provision of law.

end delete
25

SEC. 9.  

Section 16321 is added to the Government Code, to
26read:

27

16321.  

(a) Notwithstanding any other law, on or before
28September 1, 2016, the Department of Finance shall compute the
29amount of outstanding loans made from the State Highway
30Account, the Motor Vehicle Fuel Account, the Highway Users
31Tax Account, and the Motor Vehicle Account to the General Fund.
32The department shall prepare a loan repayment schedule, pursuant
33to which the outstanding loans shall be repaid, as follows:

34(1) On or before June 30, 2017, 50 percent of the outstanding
35loan amounts.

36(2) On or before June 30, 2018, the remainder of the outstanding
37loan amounts.

38(b) Notwithstanding any other law, as the loans are repaid
39pursuant to this section, the repaid funds shall be transferred in the
40following manner:

P16   1(1) Fifty percent to cities and counties pursuant to clauses (i)
2and (ii) of subparagraph (C) of paragraph (3) of subdivision (a) of
3Section 2103 of the Streets and Highways Code.

4(2) Fifty percent to the department for maintenance of the state
5highway system and for purposes of the state highway operation
6and protection program.

7(c) Funds for loan repayments pursuant to this section are hereby
8appropriated from the Budget Stabilization Account pursuant to
9subclause (II) of clause (ii) of subparagraph (B) of paragraph (1)
10of subdivision (c) of Section 20 of Article XVI of the California
11Constitution.

12

SEC. 10.  

Section 16965 of the Government Code is amended
13to read:

14

16965.  

(a) (1) The Transportation Debt Service Fund is hereby
15created in the State Treasury. Moneys in the fund shall be dedicated
16to all of the following purposes:

17(A) Payment of debt service with respect to designated bonds,
18as defined in subdivision (c) of Section 16773, and as further
19provided in paragraph (3) and subdivision (b).

20(B) To reimburse the General Fund for debt service with respect
21to bonds.

22(C) To redeem or retire bonds, pursuant to Section 16774,
23maturing in a subsequent fiscal year.

24(2) The bonds eligible under subparagraph (B) or (C) of
25 paragraph (1) include bonds issued pursuant to thebegin delete Clean Air and
26Transportation Improvement Act of 1990 (Part 11.5 (commencing
27with Section 99600) of Division 10 of the Public Utilities Code),
28theend delete
Passenger Rail and Clean Air Bond Act of 1990 (Chapter 17
29(commencing with Section 2701) of Division 3 of the Streets and
30Highways Code), the Seismic Retrofit Bond Act of 1996 (Chapter
3112.48 (commencing with Section 8879) of Division 1 of Title 2),
32and the Safe, Reliable High-Speed Passenger Train Bond Act for
33the 21st Century (Chapter 20 (commencing with Section 2704) of
34Division 3 of the Streets and Highways Code), and nondesignated
35bonds under Proposition 1B, as defined in subdivision (c) of
36Section 16773.

37(3) (A) The Transportation Bond Direct Payment Account is
38hereby created in the State Treasury, as a subaccount within the
39Transportation Debt Service Fund, for the purpose of directly
40paying the debt service, as defined in paragraph (4), of designated
P17   1bonds of Proposition 1B, as defined in subdivision (c) of Section
216773. Notwithstanding Section 13340, moneys in the
3Transportation Bond Direct Payment Account are continuously
4appropriated for payment of debt service with respect to designated
5bonds as provided in subdivision (c) of Section 16773. So long as
6any designated bonds remain outstanding, the moneys in the
7Transportation Bond Direct Payment Account may not be used
8for any other purpose, and may not be borrowed by or available
9for transfer to the General Fund pursuant to Section 16310 or any
10similar law, or to the General Cash Revolving Fund pursuant to
11Section 16381 or any similar law.

12(B) Once the Treasurer makes a certification that payment of
13debt service with respect to all designated bonds has been paid or
14provided for, any remaining moneys in the Transportation Bond
15Direct Payment Account shall be transferred back to the
16Transportation Debt Service Fund.

17(C) The moneys in the Transportation Bond Direct Payment
18Account shall be invested in the Surplus Money Investment Fund,
19and all investment earnings shall accrue to the account.

20(D) The Controller may establish subaccounts within the
21Transportation Bond Direct Payment Account as may be required
22by the resolution, indenture, or other documents governing any
23designated bonds.

24(4) For purposes of this subdivision and subdivision (b), and
25subdivision (c) of Section 16773, “debt service” means payment
26of all of the following costs and expenses with respect to any
27designated bond:

28(A) The principal of and interest on the bonds.

29(B) Amounts payable as the result of tender on any bonds, as
30described in clause (iv) of subparagraph (B) of paragraph (1) of
31subdivision (d) of Section 16731.

32(C) Amounts payable under any contractual obligation of the
33state to repay advances and pay interest thereon under a credit
34enhancement or liquidity agreement as described in clause (iv) of
35subparagraph (B) of paragraph (1) of subdivision (d) of Section
3616731.

37(D) Any amount owed by the state to a counterparty after any
38offset for payments owed to the state on any hedging contract as
39described in subparagraph (A) of paragraph (2) of subdivision (d)
40of Section 16731.

P18   1(b) From the moneys transferred to the fund pursuant to
2paragraph (2) or (3) of subdivision (c) of Section 9400.4 of the
3Vehicle Code, there shall first be deposited into the Transportation
4Bond Direct Payment Account in each month sufficient funds to
5equal the amount designated in a certificate submitted by the
6Treasurer to the Controller and the Director of Finance at the start
7of each fiscal year, and as may be modified by the Treasurer
8thereafter upon issuance of any new issue of designated bonds or
9upon change in circumstances that requires such a modification.
10This certificate shall be calculated by the Treasurer to identify, for
11each month, the amount necessary to fund all of the debt service
12with respect to all designated bonds. This calculation shall be done
13in a manner provided in the resolution, indenture, or other
14documents governing the designated bonds. In the event that
15transfers to the Transportation Bond Direct Payment Account in
16any month are less than the amounts required in the Treasurer’s
17certificate, the shortfall shall carry over to be part of the required
18payment in the succeeding month or months.

19(c) The state hereby covenants with the holders from time to
20time of any designated bonds that it will not alter, amend, or restrict
21the provisions of subdivision (c) of Section 16773 of the
22Government Code, or Sections 9400, 9400.1, 9400.4, and 42205
23of the Vehicle Code, which provide directly or indirectly for the
24transfer of weight fees to the Transportation Debt Service Fund
25or the Transportation Bond Direct Payment Account, or
26subdivisions (a) and (b) of this section, or reduce the rate of
27imposition of vehicle weight fees under Sections 9400 and 9400.1
28of the Vehicle Code as they existed on the date of the first issuance
29of any designated bonds, if that alteration, amendment, restriction,
30or reduction would result in projected weight fees for the next
31fiscal year determined by the Director of Finance being less than
32two times the maximum annual debt service with respect to all
33outstanding designated bonds, as such calculation is determined
34pursuant to the resolution, indenture, or other documents governing
35the designated bonds. The state may include this covenant in the
36 resolution, indenture, or other documents governing the designated
37bonds.

38(d) Once the required monthly deposit, including makeup of
39any shortfalls from any prior month, has been made pursuant to
40subdivision (b), from moneys transferred to the fund pursuant to
P19   1paragraph (2) or (3) of subdivision (c) of Section 9400.4 of the
2Vehicle Code, or pursuant to Section 16965.1 or 63048.67, the
3Controller shall transfer as an expenditure reduction to the General
4Fund any amount necessary to offset the cost of current year debt
5service payments made from the General Fund with respect to any
6bonds issued pursuant to Proposition 192 (1996) and three-quarters
7of the amount of current year debt service payments made from
8the General Fund with respect to any nondesignated bonds, as
9defined in subdivision (c) of Section 16773, issued pursuant to
10Proposition 1B (2006). In the alternative, these funds may also be
11used to redeem or retire the applicable bonds, pursuant to Section
1216774, maturing in a subsequent fiscal year as directed by the
13Director of Finance.

begin delete end deletebegin delete

14(e) From moneys transferred to the fund pursuant to Section
15183.1 of the Streets and Highways Code, the Controller shall
16transfer as an expenditure reduction to the General Fund any
17amount necessary to offset the cost of current year debt service
18payments made from the General Fund with respect to any bonds
19issued pursuant to Proposition 116 (1990). In the alternative, these
20funds may also be used to redeem or retire the applicable bonds,
21pursuant to Section 16774, maturing in a subsequent fiscal year
22as directed by the Director of Finance.

end delete
begin delete end deletebegin delete

23(f)

end delete

24begin insert(e)end insert Once the required monthly deposit, including makeup of
25any shortfalls from any prior month, has been made pursuant to
26subdivision (b), from moneys transferred to the fund pursuant to
27paragraph (2) or (3) of subdivision (c) of Section 9400.4 of the
28Vehicle Code, or pursuant to Section 16965.1 or 63048.67, the
29Controller shall transfer as an expenditure reduction to the General
30Fund any amount necessary to offset the eligible cost of current
31year debt service payments made from the General Fund with
32respect to any bonds issued pursuant to Proposition 108 (1990)
33and Proposition 1A (2008), and one-quarter of the amount of
34current year debt service payments made from the General Fund
35with respect to any nondesignated bonds, as defined in subdivision
36(c) of Section 16773, issued pursuant to Proposition 1B (2006).
37The Department of Finance shall notify the Controller by July 30
38of every year of the percentage of debt service that is expected to
39be paid in that fiscal year with respect to bond-funded projects that
40qualify as eligible guideway projects consistent with the
P20   1requirements applicable to the expenditure of revenues under
2Article XIX of the California Constitution, and the Controller shall
3make payments only for those eligible projects. In the alternative,
4these funds may also be used to redeem or retire the applicable
5bonds, pursuant to Section 16774, maturing in a subsequent fiscal
6year as directed by the Director of Finance.

begin delete

7(g)

end delete

8begin insert(f)end insert On or before the second business day following the date on
9which transfers are made to the Transportation Debt Service Fund,
10and after the required monthly deposits for that month, including
11makeup of any shortfalls from any prior month, have been made
12to the Transportation Bond Direct Payment Account, the Controller
13shall transfer the funds designated for reimbursement of bond debt
14service with respect to nondesignated bonds, as defined in
15subdivision (c) of Section 16773, and other bonds identified in
16subdivisionsbegin delete (d), (e), and (f)end deletebegin insert (d) and (e)end insert in that month from the
17fund to the General Fund pursuant to this section.

18

SEC. 11.  

Section 39719 of the Health and Safety Code is
19amended to read:

20

39719.  

(a) The Legislature shall appropriate the annual
21proceeds of the fund for the purpose of reducing greenhouse gas
22emissions in this state in accordance with the requirements of
23Section 39712.

24(b) To carry out a portion of the requirements of subdivision
25(a), annual proceeds are continuously appropriated for the
26following:

27(1) Beginning in thebegin delete 2015-16end deletebegin insert 2016-17end insert fiscal year, and
28notwithstanding Section 13340 of the Government Code,begin delete 35end deletebegin insert 50end insert
29 percent of annual proceeds are continuously appropriated, without
30regard to fiscal years, for transit, affordable housing, and
31sustainable communities programs as following:

32(A) begin deleteTen end deletebegin insertTwenty end insertpercent of the annual proceeds of the fund is
33hereby continuously appropriated to the Transportation Agency
34for the Transit and Intercity Rail Capital Program created by Part
352 (commencing with Section 75220) of Division 44 of the Public
36Resources Code.

37(B) begin deleteFive end deletebegin insertTen end insertpercent of the annual proceeds of the fund is hereby
38continuously appropriated to the Low Carbon Transit Operations
39Program created by Part 3 (commencing with Section 75230) of
40Division 44 of the Public Resources Code.begin delete Fundsend deletebegin insert Moneysend insert shall be
P21   1allocated by the Controller, according to requirements of the
2program, and pursuant to the distribution formula in subdivision
3(b) or (c) of Section 99312 of, and Sections 99313 and 99314 of,
4the Public Utilities Code.

5(C) Twenty percent of the annual proceeds of the fund is hereby
6continuously appropriated to the Strategic Growth Council for the
7Affordable Housing and Sustainable Communities Program created
8by Part 1 (commencing with Section 75200) of Division 44 of the
9Public Resources Code. Of the amount appropriated in this
10subparagraph, no less than 10 percent of the annualbegin delete proceeds,end delete
11begin insert proceedsend insert shall be expended for affordable housing, consistent with
12the provisions of that program.

13(2) Beginning in the 2015-16 fiscal year, notwithstanding
14Section 13340 of the Government Code, 25 percent of the annual
15proceeds of the fund is hereby continuously appropriated to the
16High-Speed Rail Authority for the following components of the
17initial operating segment and Phase I Blended System as described
18in the 2012 business plan adopted pursuant to Section 185033 of
19the Public Utilities Code:

20(A) Acquisition and construction costs of the project.

21(B) Environmental review and design costs of the project.

22(C) Other capital costs of the project.

23(D) Repayment of any loans made to the authority to fund the
24project.

25(c) In determining the amount of annual proceeds of the fund
26for purposes of the calculation in subdivision (b), the funds subject
27to Section 39719.1 shall not be included.

28

SEC. 12.  

Section 21080.37 of the Public Resources Code is
29amended to read:

30

21080.37.  

(a) This division does not apply to a project or an
31activity to repair, maintain, or make minor alterations to an existing
32roadway if all of the following conditions are met:

begin delete

33(1) The project is carried out by a city or county with a
34population of less than 100,000 persons to improve public safety.

end delete
begin delete

35(2)

end delete

36begin insert(1)end insert (A) The project does not cross a waterway.

37(B) For purposes of this paragraph, “waterway” means a bay,
38estuary, lake, pond, river, slough, or a perennial, intermittent, or
39ephemeral stream, lake, or estuarine-marine shoreline.

begin delete

40(3)

end delete

P22   1begin insert(2)end insert The project involves negligible or no expansion of an
2existing use beyond that existing at the time of the lead agency’s
3determination.

begin delete end deletebegin delete

4(4) The roadway is not a state roadway.

end delete
begin delete end deletebegin delete

5(5)

end delete

6begin insert(3)end insert (A) The site of the project does not contain wetlands or
7riparian areas and does not have significant value as a wildlife
8habitat, and the project does not harm any species protected by the
9federal Endangered Species Act of 1973 (16 U.S.C. Sec. 1531 et
10seq.), the Native Plant Protection Act (Chapter 10 (commencing
11with Section 1900) of Division 2 of the Fish and Game Code), or
12the California Endangered Species Act (Chapter 1.5 (commencing
13with Section 2050) of Division 3 of the Fish and Game Code), and
14the project does not cause the destruction or removal of any species
15protected by a local ordinance.

16(B) For the purposes of this paragraph:

17(i) “Riparian areas” mean those areas transitional between
18terrestrial and aquatic ecosystems and that are distinguished by
19gradients in biophysical conditions, ecological processes, and biota.
20A riparian area is an area through which surface and subsurface
21hydrology connect waterbodies with their adjacent uplands. A
22riparian area includes those portions of terrestrial ecosystems that
23significantly influence exchanges of energy and matter with aquatic
24ecosystems. A riparian area is adjacent to perennial, intermittent,
25and ephemeral streams, lakes, and estuarine-marine shorelines.

26(ii) “Significant value as a wildlife habitat” includes wildlife
27habitat of national, statewide, regional, or local importance; habitat
28for species protected by the federal Endangered Species Act of
291973 (16 U.S.C. Sec. 1531, et seq.), the California Endangered
30Species Act (Chapter 1.5 (commencing with Section 2050) of
31Division 3 of the Fish and Game Code), or the Native Plant
32Protection Act (Chapter 10 (commencing with Section 1900) of
33Division 2 of the Fish and Game Code); habitat identified as
34candidate, fully protected, sensitive, or species of special status
35by local, state, or federal agencies; or habitat essential to the
36movement of resident or migratory wildlife.

37(iii) “Wetlands” has the same meaning as in the United States
38Fish and Wildlife Service Manual, Part 660 FW 2 (June 21, 1993).

P23   1(iv) “Wildlife habitat” means the ecological communities upon
2which wild animals, birds, plants, fish, amphibians, and
3invertebrates depend for their conservation and protection.

begin delete

4(6)

end delete

5begin insert(4)end insert The project does not impact cultural resources.

begin delete

6(7)

end delete

7begin insert(5)end insert The roadway does not affect scenic resources, as provided
8pursuant to subdivision (c) of Section 21084.

9(b) Prior to determining that a project is exempt pursuant to this
10section, the lead agency shall do both of the following:

11(1) Include measures in the project to mitigate potential
12vehicular traffic and safety impacts and bicycle and pedestrian
13safety impacts.

14(2) Hold a noticed public hearing on the project to hear and
15respond to public comments. The hearing on the project may be
16conducted with another noticed lead agency public hearing.
17Publication of the notice shall be no fewer times than required by
18Section 6061 of the Government Code, by the public agency in a
19newspaper of general circulation in the area.

20(c) For purposes of this section, “roadway” means a roadway
21as defined pursuant to Section 530 of the Vehicle Code and the
22previously graded and maintained shoulder that is within a roadway
23right-of-way of no more than five feet from the edge of the
24roadway.

begin insert

25
(d) (1) If a state agency determines that a project is not subject
26to this division pursuant to this section and it approves or
27determines to carry out that project, it shall file a notice with the
28Office of Planning and Research in the manner specified in
29subdivisions (b) and (c) of Section 21108.

end insert
begin delete

30(d) Whenever

end delete

31begin insert(2)end insertbegin insertend insertbegin insertIfend insert a local agency determines that a project is not subject to
32this division pursuant to thisbegin delete section,end deletebegin insert sectionend insert and it approves or
33determines to carry out that project,begin delete the local agencyend deletebegin insert itend insert shall file
34a notice with the Office of Planning and Research, and with the
35county clerk in the county in which the project will be located in
36the manner specified in subdivisions (b) and (c) of Section 21152.

begin delete end deletebegin delete

37(e) This section shall remain in effect only until January 1, 2020,
38and as of that date is repealed, unless a later enacted statute, that
39is enacted before January 1, 2020, deletes or extends that date.

end delete
begin delete end delete
P24   1

SEC. 13.  

Division 13.6 (commencing with Section 21200) is
2added to the Public Resources Code, to read:

3 

4Division 13.6.  ADVANCE MITIGATION PROGRAM ACT

5

 

6Chapter  1. General
7

 

8

21200.  

This division shall be known, and may be cited, as the
9Advance Mitigation Program Act.

10

21201.  

(a) The purpose of this division is to improve the
11success and effectiveness of actions implemented to mitigate the
12natural resource impacts of future transportation projects by
13establishing the means to implement those actions well before the
14transportation projects are constructed. The advance identification
15and implementation of mitigation actions also will streamline the
16delivery of transportation projects by anticipating mitigation
17requirements for planned transportation projects and avoiding or
18reducing delays associated with environmental permitting. By
19identifying regional or statewide conservation priorities and by
20anticipating the impacts of planned transportation projects on a
21regional or statewide basis, mitigation actions can be designed to
22protect and restore California’s most valuable natural resources
23and also facilitate environmental compliance for planned
24transportation projects on a regional scale.

25(b) This division is not intended to create a new environmental
26permitting or regulatory program or to modify existing
27environmental laws or regulations, nor is it expected that all
28mitigation requirements will be addressed for planned
29transportation projects. Instead, it is intended to provide a
30methodology with which to anticipate and fulfill the requirements
31of existing state and federal environmental laws that protect fish,
32wildlife, plant species, and other natural resources more efficiently
33and effectively.

34

21202.  

The Legislature finds and declares all of the following:

35(a) The minimization and mitigation of environmental impacts
36is ordinarily handled on a project-by-project basis, usually near
37the end of a project’s timeline and often without guidance regarding
38regional or statewide conservation priorities.

39(b) The cost of critical transportation projects often escalates
40because of permitting delays that occur when appropriate
P25   1conservation and mitigation measures cannot easily be identified
2and because the cost of these measures often increases between
3the time a project is planned and funded and the time mitigation
4is implemented.

5(c) Addressing conservation and mitigation needs early in a
6project’s timeline, during the project design and development
7phase, can reduce costs, allow natural resources conservation to
8be integrated with project siting and design, and result in the
9establishment of more valuable and productive habitat mitigation.

10(d) When the Department of Transportation is able to anticipate
11the mitigation needs for planned transportation projects, it can
12meet those needs in a more timely and cost-effective way by using
13advance mitigation planning.

14(e) Working with state and federal resource protection agencies,
15the department can identify, conserve, and, where appropriate,
16restore lands for mitigation of numerous projects early in the
17projects’ timelines, thereby allowing public funds to stretch further
18by acquiring habitat at a lower cost and avoiding environmental
19permitting delays.

20(f) Advance mitigation can provide an effective means of
21facilitating delivery of transportation projects while ensuring more
22effective natural resource conservation.

23(g) Advance mitigation is needed to direct mitigation funding
24for transportation projects to agreed-upon conservation priorities
25and to the creation of habitat reserves and recreation areas that
26enhance the sustainability of human and natural systems by
27protecting or restoring connectivity of natural communities and
28the delivery of ecosystem services.

29(h) Advance mitigation can facilitate the implementation of
30climate change adaptation strategies both for ecosystems and
31California’s economy.

32(i) Advance mitigation can enable the state to protect, restore,
33and recover its natural resources as it strengthens and improves
34its transportation systems.

35

21203.  

The Legislature intends to do all of the following by
36enacting this division:

37(a) Facilitate delivery of transportation projects while ensuring
38more effective natural resource conservation.

P26   1(b) Develop effective strategies to improve the state’s ability to
2meet mounting demands for transportation improvements and to
3maximize conservation and other public benefits.

4(c) Achieve conservation objectives of statewide and regional
5importance by coordinating local, state, and federally funded
6natural resource conservation efforts with mitigation actions
7required for impacts from transportation projects.

8(d) Create administrative, governance, and financial incentives
9and mechanisms necessary to ensure that measures required to
10minimize or mitigate impacts from transportation projects will
11serve to achieve regional or statewide natural resource conservation
12objectives.

13 

14Chapter  2. Definitions
15

 

16

21204.  

For purposes of this division, the following terms have
17the following meanings:

18(a) “Acquire” and “acquisition” mean, with respect to land or
19a waterway, acquisition of fee title or purchase of a conservation
20easement, that protects conservation and mitigation values on the
21land or waterway in perpetuity.

22(b) “Advance mitigation” means mitigation implemented before,
23and in anticipation of, environmental effects of planned
24transportation projects.

25(c) “Commission” means the California Transportation
26Commission.

27(d) “Department” means the Department of Transportation.

28(e) “Transportation agency” means the department, the
29High-Speed Rail Authority, a metropolitan planning organization,
30a regional transportation planning agency, or another public agency
31that implements transportation projects.

32(f) “Transportation project” means a transportation capital
33improvement project.

34(g) “Planned transportation project” means a transportation
35project that a transportation agency has concluded is reasonably
36likely to be constructed within 20 years and that has been identified
37to the agency for purposes of this division. A planned transportation
38project may include, but is not limited to, a transportation project
39that has been proposed for approval or that has been approved.

P27   1(h) “Program” means the Advance Mitigation Program
2implemented pursuant to this division.

3(i) “Regulatory agency” means a state or federal natural resource
4protection agency with regulatory authority over planned
5transportation projects. A regulatory agency includes, but is not
6limited to, the Natural Resources Agency, the Department of Fish
7and Wildlife, California regional water quality control boards, the
8United States Fish and Wildlife Service, the National Marine
9Fisheries Service, the United States Environmental Protection
10Agency, and the United States Army Corps of Engineers.

11 

12Chapter  3. Advance Mitigation Program
13

 

14

21205.  

(a) The Advance Mitigation Program is hereby created
15in the department to accelerate project delivery and improve
16environmental outcomes of environmental mitigation for planned
17transportation projects.

18(b) The program may utilize mitigation instruments, including,
19but not limited to, mitigation banks, in lieu of fee programs, and
20conservation easements as defined in Section 815.1 of the Civil
21Code.

22(c) The department shall track all implemented advance
23mitigation projects to use as credits for environmental mitigation
24for state-sponsored transportation projects.

25(d) The department may use advance mitigation credits to fulfill
26mitigation requirements of any environmental law for a
27transportation project eligible for the State Transportation
28Improvement Program or the State Highway Operation and
29Protection Program.

30

21206.  

No later than February 1, 2017, the department shall
31establish an interagency transportation advance mitigation steering
32committee consisting of the department and appropriate state and
33federal regulatory agencies to support the program so that advance
34mitigation can be used as required mitigation for planned
35transportation projects and can provide improved environmental
36outcomes. The committee shall advise the department of
37opportunities to carry out advance mitigation projects, provide the
38best available science, and actively participate in mitigation
39instrument reviews and approvals. The committee shall seek to
40develop streamlining opportunities, including those related to
P28   1landscape scale mitigation planning and alignment offederal and
2state regulations and procedures related to mitigation requirements
3and implementation. The committee shall also provide input on
4crediting, using, and tracking of advance mitigation investments.

5

21207.  

The Advance Mitigation Fund is hereby created in the
6State Transportation Fund as a revolving fund. Notwithstanding
7Section 13340 of the Government Code, the fund shall be
8continuously appropriated without regard to fiscal years. The
9moneys in the fund shall be programmed by the commission for
10the planning and implementation of advance mitigation projects
11consistent with the purposes of this chapter. After the transfer of
12moneys to the fund for four fiscal years pursuant to subdivision
13(c) of Section 2032 of the Streets and Highways Code, commencing
14in the 2017-18 fiscal year, the program is intended to be
15self-sustaining. Advance expenditures from the fund shall later be
16reimbursed from project funding available at the time a planned
17transportation project is constructed. A maximum of 5 percent of
18available funds may be used for administrative purposes.

19

SEC. 14.  

Section 99312.1 of the Public Utilities Code is
20amended to read:

21

99312.1.  

begin insert(a)end insertbegin insertend insertRevenues transferred to the Public Transportation
22Account pursuant to Sections 6051.8 and 6201.8 of the Revenue
23and Taxation Code are hereby continuously appropriated to the
24Controller for allocation as follows:

begin delete

25(a)

end delete

26begin insert(1)end insert Fifty percent for allocation to transportation planning
27agencies, county transportation commissions, and the San Diego
28Metropolitan Transit Development Board pursuant to Section
2999314.

begin delete

30(b)

end delete

31begin insert(2)end insert Fifty percent for allocation to transportation agencies, county
32transportation commissions, and the San Diego Metropolitan
33Transit Development Board for purposes of Section 99313.

begin delete

34 For

end delete

35begin insert(b)end insertbegin insertend insertbegin insertForend insert purposes of this chapter, the revenues allocated pursuant
36to this section shall be subject to the same requirements as revenues
37allocated pursuant to subdivisions (b) and (c), as applicable, of
38Section 99312.

begin insert

39
(c) The revenues transferred to the Public Transportation
40Account that are attributable to the increase in the sales and use
P29   1tax on diesel fuel pursuant to subdivision (b) of Section 6051.8 of
2the Revenue and Taxation Code, as adjusted pursuant to
3subdivision (c) of that section, and subdivision (b) of Section 6201.8
4of the Revenue and Taxation Code, as adjusted pursuant to
5subdivision (c) of that section, upon allocation pursuant to Sections
699313 and 99314, shall only be expended on the following:

end insert
begin insert

7
(1) Transit capital projects or services to maintain or repair a
8transit operator’s existing transit vehicle fleet or existing transit
9facilities, including rehabilitation or modernization of existing
10vehicles or facilities.

end insert
begin insert

11
(2) The design, acquisition, and construction of new vehicles
12or facilities that improve existing transit services.

end insert
begin insert

13
(3) Transit services that complement local efforts for repair and
14improvement of local transportation infrastructure.

end insert
begin insert

15
(d) (1) Prior to receiving an apportionment of funds pursuant
16to subdivision (c) from the Controller in a fiscal year, a recipient
17transit agency shall submit to the Department of Transportation
18a list of projects proposed to be funded with these funds. The list
19of projects proposed to be funded with these funds shall include
20a description and location of each proposed project, a proposed
21schedule for the project’s completion, and the estimated useful life
22of the improvement. The project list shall not limit the flexibility
23of a recipient transit agency to fund projects in accordance with
24local needs and priorities so long as the projects are consistent
25with subdivision (c).

end insert
begin insert

26
(2) The department shall report to the Controller the recipient
27transit agencies that have submitted a list of projects as described
28in this subdivision and that are therefore eligible to receive an
29apportionment of funds for the applicable fiscal year. The
30Controller, upon receipt of the report, shall apportion funds
31pursuant to Sections 99313 and 99314.

end insert
begin insert

32
(e) For each fiscal year, each recipient transit agency receiving
33an apportionment of funds pursuant to subdivision (c) shall, upon
34expending those funds, submit documentation to the department
35that includes a description and location of each completed project,
36the amount of funds expended on the project, the completion date,
37and the estimated useful life of the improvement.

end insert
begin insert

38
(f) The audit of transit operator finances required pursuant to
39Section 99245 shall verify that the revenues identified in
40subdivision (c) have been expended in conformance with these
P30   1specific requirements and all other generally applicable
2requirements.

end insert
3

SEC. 15.  

Section 6051.8 of the Revenue and Taxation Code
4 is amended to read:

5

6051.8.  

(a) Except as provided by Section 6357.3, in addition
6to the taxes imposed by this part, for the privilege of selling
7tangible personal property at retail a tax is hereby imposed upon
8all retailers at the rate of 1.75 percent of the gross receipts of any
9retailer from the sale of all diesel begin delete fuel, as defined in Section 60022,
10sold at retail in this state on and after the operative date of this
11subdivision.end delete
begin insert fuel.end insert

begin delete

12(b) Notwithstanding subdivision (a), for the 2011-12 fiscal year
13only, the rate referenced in subdivision (a) shall be 1.87 percent.

end delete
begin delete

14(c) Notwithstanding subdivision (a), for the 2012-13 fiscal year
15only, the rate referenced in subdivision (a) shall be 2.17 percent.

end delete
begin delete

16(d) Notwithstanding subdivision (a), for the 2013-14 fiscal year
17only, the rate referenced in subdivision (a) shall be 1.94 percent.

end delete
begin insert

18
(b) Except as provided by Section 6357.3, in addition to the
19taxes imposed by this part and by subdivision (a), for the privilege
20of selling tangible personal property at retail a tax is hereby
21imposed upon all retailers at the rate of 3.5 percent of the gross
22receipts of any retailer from the sale of all diesel fuel, as defined
23in Section 60022, sold at retail in this state. The tax imposed under
24this subdivision shall be imposed on and after the first day of the
25first calendar quarter that occurs 90 days after the effective date
26of the act adding this subdivision.

end insert
begin insert

27
(c) Beginning July 1, 2019, and every third year thereafter, the
28State Board of Equalization shall recompute the rates of the taxes
29imposed by this section. That computation shall be made as
30follows:

end insert
begin insert

31
(1) The Department of Finance shall transmit to the State Board
32of Equalization the percentage change in the California Consumer
33Price Index for all items from November of three calendar years
34prior to November of the prior calendar year, no later than January
3531, 2019, and January 31 of every third year thereafter.

end insert
begin insert

36
(2) The State Board of Equalization shall do all of the following:

end insert
begin insert

37
(A) Compute an inflation adjustment factor by adding 100
38percent to the percentage change figure that is furnished pursuant
39to paragraph (1) and dividing the result by 100.

end insert
begin insert

P31   1
(B) Multiply the preceding tax rate per gallon by the inflation
2adjustment factor determined in subparagraph (A) and round off
3the resulting product to the nearest tenth of a cent.

end insert

4(C) Make its determination of the new rate no later than March
51 of the same year as the effective date of the new rate.

begin delete

6(e)

end delete

7begin insert(d)end insert Notwithstanding subdivision (b) of Section 7102, all of the
8revenues, less refunds, collected pursuant to this section shall be
9estimated by the State Board of Equalization, with the concurrence
10of the Department of Finance, and transferred quarterly to the
11Public Transportation Account in the State Transportation Fund
12for allocation pursuant to Section 99312.1 of the Public Utilities
13Code.

begin delete

14(f) Subdivisions (a) to (e), inclusive, shall become operative on
15July 1, 2011.

end delete
16

SEC. 16.  

Section 6201.8 of the Revenue and Taxation Code
17 is amended to read:

18

6201.8.  

(a) Except as provided by Section 6357.3, in addition
19to the taxes imposed by this part, an excise tax is hereby imposed
20on the storage, use, or other consumption in this state of diesel
21fuel, as defined in Section 60022, at the rate of 1.75 percent of the
22sales price of the dieselbegin delete fuel on and after the operative date of this
23subdivision.end delete
begin insert fuel.end insert

begin delete

24(b) Notwithstanding subdivision (a), for the 2011-12 fiscal year
25only, the rate referenced in subdivision (a) shall be 1.87 percent.

end delete
begin delete

26(c) Notwithstanding subdivision (a), for the 2012-13 fiscal year
27only, the rate referenced in subdivision (a) shall be 2.17 percent.

end delete
begin delete

28(d) Notwithstanding subdivision (a), for the 2013-14 fiscal year
29only, the rate referenced in subdivision (a) shall be 1.94 percent.

end delete
begin insert

30
(b) Except as provided by Section 6357.3, in addition to the
31taxes imposed by this part and by subdivision (a), an excise tax is
32hereby imposed on the storage, use, or other consumption in this
33state of diesel fuel, as defined in Section 60022, at the rate of 3.5
34percent of the sales price of the diesel fuel. The tax imposed under
35this subdivision shall be imposed on and after the first day of the
36first calendar quarter that occurs 90 days after the effective date
37of the act adding this subdivision.

end insert
begin insert

38
(c) Beginning July 1, 2019, and every third year thereafter, the
39State Board of Equalization shall recompute the rates of the taxes
P32   1imposed by this section. That computation shall be made as
2follows:

end insert
begin insert

3
(1) The Department of Finance shall transmit to the State Board
4of Equalization the percentage change in the California Consumer
5Price Index for all items from November of three calendar years
6prior to November of the prior calendar year, no later than January
731, 2019, and January 31 of every third year thereafter.

end insert
begin insert

8
(2) The State Board of Equalization shall do all of the following:

end insert
begin insert

9
(A) Compute an inflation adjustment factor by adding 100
10percent to the percentage change figure that is furnished pursuant
11to paragraph (1) and dividing the result by 100.

end insert
begin insert

12
(B) Multiply the preceding tax rate per gallon by the inflation
13adjustment factor determined in subparagraph (A) and round off
14the resulting product to the nearest tenth of a cent.

end insert
begin insert

15
(C) Make its determination of the new rate no later than March
161 of the same year as the effective date of the new rate.

end insert
begin delete

17(e)

end delete

18begin insert(d)end insert Notwithstanding subdivision (b) of Section 7102, all of the
19revenues, less refunds, collected pursuant to this section shall be
20estimated by the State Board of Equalization, with the concurrence
21of the Department of Finance, and transferred quarterly to the
22Public Transportation Account in the State Transportation Fund
23for allocation pursuant to Section 99312.1 of the Public Utilities
24Code.

begin delete

25(f) Subdivisions (a) to (e), inclusive, shall become operative on
26July 1, 2011.

end delete
27

SEC. 17.  

Section 7360 of the Revenue and Taxation Code is
28amended to read:

29

7360.  

(a) (1) begin insert(A)end insertbegin insertend insertA tax of eighteen cents ($0.18) is hereby
30imposed upon each gallon of fuel subject to the tax in Sections
317362, 7363, and 7364.

begin insert

32
(B) In addition to the tax imposed pursuant to subparagraph
33(A), on and after the first day of the first calendar quarter that
34occurs 90 days after the effective date of the act adding this
35subparagraph, a tax of seventeen cents ($0.17) is hereby imposed
36upon each gallon of fuel, other than aviation gasoline, subject to
37the tax in Sections 7362, 7363, and 7364.

end insert

38(2) If the federal fuel tax is reduced below the rate of nine cents
39($0.09) per gallon and federal financial allocations to this state for
40highway and exclusive public mass transit guideway purposes are
P33   1reduced or eliminated correspondingly, the tax rate imposed by
2begin insert subparagraph (A) ofend insert paragraph (1), on and after the date of the
3reduction, shall be recalculated by an amount so that the combined
4state rate underbegin insert subparagraph (A) ofend insert paragraph (1) and the federal
5tax rate per gallon equal twenty-seven cents ($0.27).

6(3) If any person or entity is exempt or partially exempt from
7the federal fuel tax at the time of a reduction, the person or entity
8shall continue to be so exempt under this section.

9(b) begin delete(1)end deletebegin deleteend deleteOn and after July 1, 2010, in addition to the tax imposed
10by subdivision (a), a tax is hereby imposed upon each gallon of
11motor vehicle fuel, other than aviation gasoline, subject to the tax
12in Sections 7362, 7363, and 7364 in an amount equal to seventeen
13and three-tenths cents ($0.173) per gallon.

begin delete

14(2) For the 2011-12 fiscal year and each fiscal year thereafter,
15the board shall, on or before March 1 of the fiscal year immediately
16preceding the applicable fiscal year, adjust the rate in paragraph
17(1) in that manner as to generate an amount of revenue that will
18equal the amount of revenue loss attributable to the exemption
19provided by Section 6357.7, based on estimates made by the board,
20and that rate shall be effective during the state’s next fiscal year.

end delete
begin delete

21(3) In order to maintain revenue neutrality for each year,
22beginning with the rate adjustment on or before March 1, 2012,
23the adjustment under paragraph (2) shall also take into account the
24extent to which the actual amount of revenues derived pursuant to
25this subdivision and, as applicable, Section 7361.1, the revenue
26loss attributable to the exemption provided by Section 6357.7
27resulted in a net revenue gain or loss for the fiscal year ending
28prior to the rate adjustment date on or before March 1.

end delete
begin delete

29(4) The intent of paragraphs (2) and (3) is to ensure that the act
30adding this subdivision and Section 6357.7 does not produce a net
31revenue gain in state taxes.

end delete
begin insert

32
(c) Beginning July 1, 2019, and every third year thereafter, the
33State Board of Equalization shall recompute the rates of the taxes
34imposed by this section. That computation shall be made as
35follows:

end insert
begin insert

36
(1) The Department of Finance shall transmit to the State Board
37of Equalization the percentage change in the California Consumer
38Price Index for all items from November of three calendar years
39prior to November of the prior calendar year, no later than January
4031, 2019, and January 31 of every third year thereafter.

end insert
begin insert

P34   1
(2) The State Board of Equalization shall do all of the following:

end insert
begin insert

2
(A) Compute an inflation adjustment factor by adding 100
3percent to the percentage change figure that is furnished pursuant
4to paragraph (1) and dividing the result by 100.

end insert
begin insert

5
(B) Multiply the preceding tax rate per gallon by the inflation
6adjustment factor determined in subparagraph (A) and round off
7the resulting product to the nearest tenth of a cent.

end insert
begin insert

8
(C) Make its determination of the new rate no later than March
91 of the same year as the effective date of the new rate.

end insert
10

SEC. 18.  

Section 8352.4 of the Revenue and Taxation Code
11 is amended to read:

12

8352.4.  

(a) Subject to Sections 8352 and 8352.1, and except
13as otherwise provided in subdivision (b), there shall be transferred
14from the money deposited to the credit of the Motor Vehicle Fuel
15Account to the Harbors and Watercraft Revolving Fund, for
16expenditure in accordance with Division 1 (commencing with
17Section 30) of the Harbors and Navigation Code, the sum of six
18million six hundred thousand dollars ($6,600,000) per annum,
19representing the amount of money in the Motor Vehicle Fuel
20Account attributable to taxes imposed on distributions of motor
21vehicle fuel used or usable in propelling vessels. The actual amount
22shall be calculated using the annual reports of registered boats
23prepared by the Department of Motor Vehicles for the United
24States Coast Guard and the formula and method of the December
251972 report prepared for this purpose and submitted to the
26Legislature on December 26, 1972, by the Director of
27Transportation. If the amount transferred during each fiscal year
28is in excess of the calculated amount, the excess shall be
29retransferred from the Harbors and Watercraft Revolving Fund to
30the Motor Vehicle Fuel Account. If the amount transferred is less
31than the amount calculated, the difference shall be transferred from
32the Motor Vehicle Fuel Account to the Harbors and Watercraft
33Revolving Fund. No adjustment shall be made if the computed
34difference is less than fifty thousand dollars ($50,000), and the
35amount shall be adjusted to reflect any temporary or permanent
36increase or decrease that may be made in the rate under the Motor
37Vehicle Fuel Tax Law. Payments pursuant to this section shall be
38made prior to payments pursuant to Section 8352.2.

39(b) Commencing July 1,begin delete 2012,end deletebegin insert 2016,end insert the revenues attributable
40to the taxes imposed pursuant to subdivision (b) of Section 7360
P35   1and Section 7361.1 and otherwise to be deposited in the Harbors
2and Watercraft Revolving Fund pursuant to subdivision (a) shall
3instead be transferred to thebegin delete General Fund. The revenues
4attributable to the taxes imposedend delete
begin insert Highway Users Tax Account for
5distributionend insert
pursuant tobegin delete subdivision (b) ofend deletebegin delete Sectionend deletebegin delete 7360 and Section
67361.1 that were deposited inend delete
begin insert Section 2103.1 ofend insert thebegin delete Harborsend deletebegin insert Streetsend insert
7 andbegin delete Watercraft Revolving Fund in the 2010-11 and 2011-12 fiscal
8years shall be transferred to the General Fund.end delete
begin insert Highways Code.end insert

9

SEC. 19.  

Section 8352.5 of the Revenue and Taxation Code
10 is amended to read:

11

8352.5.  

(a) (1) Subject to Sections 8352 and 8352.1, and
12except as otherwise provided in subdivision (b), there shall be
13transferred from the money deposited to the credit of the Motor
14Vehicle Fuel Account to the Department of Food and Agriculture
15Fund, during the second quarter of each fiscal year, an amount
16equal to the estimate contained in the most recent report prepared
17pursuant to this section.

18(2) The amounts are not subject to Section 6357 with respect
19to the collection of sales and use taxes thereon, and represent the
20portion of receipts in the Motor Vehicle Fuel Account during a
21calendar year that were attributable to agricultural off-highway
22use of motor vehicle fuel which is subject to refund pursuant to
23Section 8101, less gross refunds allowed by the Controller during
24the fiscal year ending Junebegin delete 30thend deletebegin insert 30end insert following the calendar year to
25persons entitled to refunds for agricultural off-highway use
26pursuant to Section 8101. Payments pursuant to this section shall
27be made prior to payments pursuant to Section 8352.2.

28(b) Commencing July 1,begin delete 2012,end deletebegin insert 2016,end insert the revenues attributable
29to the taxes imposed pursuant to subdivision (b) of Section 7360
30and Section 7361.1 and otherwise to be deposited in the
31Department of Food and Agriculture Fund pursuant to subdivision
32(a) shall instead be transferred to thebegin delete General Fund. The revenues
33attributable to the taxes imposedend delete
begin insert Highway Users Tax Account for
34distributionend insert
pursuant tobegin delete subdivision (b) ofend deletebegin delete Sectionend deletebegin delete 7360 and Section
357361.1 that were deposited in the Departmentend delete
begin insert Section 2103.1end insert of
36begin delete Food and Agriculture Fund inend delete thebegin delete 2010-11end deletebegin insert Streetsend insert andbegin delete 2011-12
37fiscal years shall be transferred to the General Fund.end delete
begin insert Highways
38Code.end insert

39(c) On or before September 30, 2012, and on or before
40September 30 of each even-numbered year thereafter, the Director
P36   1of Transportation and the Director of Food and Agriculture shall
2jointly prepare, or cause to be prepared, a report setting forth the
3current estimate of the amount of money in the Motor Vehicle
4Fuel Account attributable to agricultural off-highway use of motor
5vehicle fuel, which is subject to refund pursuant to Section 8101
6less gross refunds allowed by the Controller to persons entitled to
7refunds for agricultural off-highway use pursuant to Section 8101;
8and they shall submit a copy of the report to the Legislature.

9

SEC. 20.  

Section 8352.6 of the Revenue and Taxation Code
10 is amended to read:

11

8352.6.  

(a) (1) Subject to Section 8352.1, and except as
12otherwise provided in paragraphs (2) and (3), on the first day of
13every month, there shall be transferred from moneys deposited to
14the credit of the Motor Vehicle Fuel Account to the Off-Highway
15Vehicle Trust Fund created by Section 38225 of the Vehicle Code
16an amount attributable to taxes imposed upon distributions of motor
17vehicle fuel used in the operation of motor vehicles off highway
18and for which a refund has not been claimed. Transfers made
19pursuant to this section shall be made prior to transfers pursuant
20to Section 8352.2.

21(2) Commencing July 1,begin delete 2012,end deletebegin insert 2016,end insert the revenues attributable
22to the taxes imposed pursuant to subdivision (b) of Section 7360
23and Section 7361.1 and otherwise to be deposited in the
24Off-Highway Vehicle Trust Fund pursuant to paragraph (1) shall
25instead be transferred to thebegin delete General Fund. The revenues
26attributable to the taxes imposedend delete
begin insert Highway Users Tax Account for
27distributionend insert
pursuant tobegin delete subdivision (b) ofend deletebegin delete Sectionend deletebegin delete 7360 and Section
287361.1 that were deposited inend delete
begin insert Section 2103.1 ofend insert thebegin delete Off-Highway
29Vehicle Trust Fund in the 2010-11end delete
begin insert Streetsend insert andbegin delete 2011-12 fiscal
30years shall be transferred to the General Fund.end delete
begin insert Highways Code.end insert

31(3) The Controller shall withhold eight hundred thirty-three
32thousand dollars ($833,000) from the monthly transfer to the
33Off-Highway Vehicle Trust Fund pursuant to paragraph (1), and
34transfer that amount to the General Fund.

35(b) The amount transferred to the Off-Highway Vehicle Trust
36Fund pursuant to paragraph (1) of subdivision (a), as a percentage
37of the Motor Vehicle Fuel Account, shall be equal to the percentage
38transferred in the 2006-07 fiscal year. Every five years, starting
39in the 2013-14 fiscal year, the percentage transferred may be
40adjusted by the Department of Transportation in cooperation with
P37   1the Department of Parks and Recreation and the Department of
2Motor Vehicles. Adjustments shall be based on, but not limited
3to, the changes in the following factors since the 2006-07 fiscal
4year or the last adjustment, whichever is more recent:

5(1) The number of vehicles registered as off-highway motor
6vehicles as required by Division 16.5 (commencing with Section
738000) of the Vehicle Code.

8(2) The number of registered street-legal vehicles that are
9anticipated to be used off highway, including four-wheel drive
10vehicles, all-wheel drive vehicles, and dual-sport motorcycles.

11(3) Attendance at the state vehicular recreation areas.

12(4) Off-highway recreation use on federal lands as indicated by
13the United States Forest Service’s National Visitor Use Monitoring
14and the United States Bureau of Land Management’s Recreation
15Management Information System.

16(c) It is the intent of the Legislature that transfers from the Motor
17Vehicle Fuel Account to the Off-Highway Vehicle Trust Fund
18should reflect the full range of motorized vehicle use off highway
19for both motorized recreation and motorized off-road access to
20other recreation opportunities. Therefore, the Legislature finds that
21the fuel tax baseline established in subdivision (b), attributable to
22off-highway estimates of use as of the 2006-07 fiscal year,
23accounts for the three categories of vehicles that have been found
24over the years to be users of fuel for off-highway motorized
25recreation or motorized access to nonmotorized recreational
26pursuits. These three categories are registered off-highway
27motorized vehicles, registered street-legal motorized vehicles used
28off highway, and unregistered off-highway motorized vehicles.

29(d) It is the intent of the Legislature that the off-highway motor
30vehicle recreational use to be determined by the Department of
31Transportation pursuant to paragraph (2) of subdivision (b) be that
32usage by vehicles subject to registration under Division 3
33(commencing with Section 4000) of the Vehicle Code, for
34recreation or the pursuit of recreation on surfaces where the use
35of vehicles registered under Division 16.5 (commencing with
36Section 38000) of the Vehicle Code may occur.

37(e) In the 2014-15 fiscal year, the Department of Transportation,
38in consultation with the Department of Parks and Recreation and
39the Department of Motor Vehicles, shall undertake a study to
40determine the appropriate adjustment to the amount transferred
P38   1pursuant to subdivision (b) and to update the estimate of the amount
2attributable to taxes imposed upon distributions of motor vehicle
3fuel used in the operation of motor vehicles off highway and for
4which a refund has not been claimed. The department shall provide
5a copy of this study to the Legislature no later than January 1,
62016.

7

SEC. 21.  

Section 60050 of the Revenue and Taxation Code is
8amended to read:

9

60050.  

(a) (1) A tax ofbegin delete eighteenend deletebegin insert thirteenend insert centsbegin delete ($0.18)end deletebegin insert ($0.13)end insert
10 is hereby imposed upon each gallon of diesel fuel subject to the
11tax in Sections 60051, 60052, and 60058.

12(2) If the federal fuel tax is reduced below the rate of fifteen
13cents ($0.15) per gallon and federal financial allocations to this
14state for highway and exclusive public mass transit guideway
15purposes are reduced or eliminated correspondingly, the tax rate
16imposed by paragraphbegin delete (1), including any reduction or adjustment
17pursuant to subdivision (b), on and after the date of the reduction,end delete

18begin insert (1)end insert shall be increased by an amount so that the combined state rate
19under paragraph (1) and the federal tax rate per gallon equal what
20it would have been in the absence of the federal reduction.

21(3) If any person or entity is exempt or partially exempt from
22the federal fuel tax at the time of a reduction, the person or entity
23shall continue to be exempt under this section.

begin delete

24(b) (1) On July 1, 2011, the tax rate specified in paragraph (1)
25of subdivision (a) shall be reduced to thirteen cents ($0.13) and
26every July 1 thereafter shall be adjusted pursuant to paragraphs
27(2) and (3).

end delete
begin delete

28(2) For the 2012-13 fiscal year and each fiscal year thereafter,
29the board shall, on or before March 1 of the fiscal year immediately
30preceding the applicable fiscal year, adjust the rate reduction in
31paragraph (1) in that manner as to result in a revenue loss
32attributable to paragraph (1) that will equal the amount of revenue
33gain attributable to Sections 6051.8 and 6201.8, based on estimates
34made by the board, and that rate shall be effective during the state’s
35next fiscal year.

end delete
begin delete

36(3) In order to maintain revenue neutrality for each year,
37beginning with the rate adjustment on or before March 1, 2013,
38the adjustment under paragraph (2) shall take into account the
39extent to which the actual amount of revenues derived pursuant to
40Sections 6051.8 and 6201.8 and the revenue loss attributable to
P39   1this subdivision resulted in a net revenue gain or loss for the fiscal
2year ending prior to the rate adjustment date on or before March
31.

end delete
begin delete

4(4) The intent of paragraphs (2) and (3) is to ensure that the act
5adding this subdivision and Sections 6051.8 and 6201.8 does not
6produce a net revenue gain in state taxes.

end delete
begin insert

7
(b) In addition to the tax imposed pursuant to subdivision (a),
8on and after the first day of the first calendar quarter that occurs
990 days after the effective date of the act amending this subdivision
10in the 2015 First Extraordinary Session, an additional tax of thirty
11cents ($0.30) is hereby imposed upon each gallon of diesel fuel
12subject to the tax in Sections 60051, 60052, and 60058.

end insert
begin insert

13
(c) Beginning July 1, 2019, and every third year thereafter, the
14State Board of Equalization shall recompute the rates of the taxes
15imposed by this section. That computation shall be made as
16follows:

end insert
begin insert

17
(1) The Department of Finance shall transmit to the State Board
18of Equalization the percentage change in the California Consumer
19Price Index for all items from November of three calendar years
20prior to November of the prior calendar year, no later than January
2131, 2019, and January 31 of every third year thereafter.

end insert
begin insert

22
(2) The State Board of Equalization shall do all of the following:

end insert
begin insert

23
(A) Compute an inflation adjustment factor by adding 100
24percent to the percentage change figure that is furnished pursuant
25to paragraph (1) and dividing the result by 100.

end insert
begin insert

26
(B) Multiply the preceding tax rate per gallon by the inflation
27adjustment factor determined in subparagraph (A) and round off
28the resulting product to the nearest tenth of a cent.

end insert
begin insert

29
(C) Make its determination of the new rate no later than March
301 of the same year as the effective date of the new rate.

end insert
31

SEC. 22.  

Section 183.1 of the Streets and Highways Code is
32amended to read:

33

183.1.  

begin delete(a)end deletebegin deleteend deletebegin deleteNotwithstanding subdivision (a) of Section 182 or
34any other provision of law, end delete
begin insertExcept as otherwise provided in Section
3554237.7 of the Government Code, end insert
money deposited into the account
36that is not subject to Article XIX of the California Constitution,
37including, but not limited to, money that is derived from the sale
38of documents, charges for miscellaneous services to the public,
39condemnation deposits fund investments, rental of state property,
40or any other miscellaneous uses of property or money,begin delete may be
P40   1used for any transportation purpose authorized by statute, upon
2appropriation by the Legislature or, after transfer to another fund,
3upon appropriation by the Legislature from that fund.end delete
begin insert shall be
4deposited in the Road Maintenance and Rehabilitation Account
5created pursuant to Section 2031.end insert

begin delete

6(b) Commencing with the 2013-14 fiscal year, and not later
7than November 1 of each fiscal year thereafter, based on prior year
8financial statements, the Controller shall transfer the funds
9identified in subdivision (a) for the prior fiscal year from the State
10Highway Account to the Transportation Debt Service Fund in the
11State Transportation Fund, and those funds are continuously
12appropriated for the purposes specified for the Transportation Debt
13Service Fund.

end delete
14

SEC. 23.  

Section 820.1 of the Streets and Highways Code is
15amended to read:

16

820.1.  

(a) The State of California consents to the jurisdiction
17of the federal courts with regard to the compliance, discharge, or
18enforcement of the responsibilities assumed by the department
19pursuant to Section 326 of, and subsection (a) of Section 327 of,
20Title 23 of the United States Code.

21(b) In any action brought pursuant to the federal laws described
22in subdivision (a), no immunity from suit may be asserted by the
23department pursuant to the Eleventh Amendment to the United
24States Constitution, and any immunity is hereby waived.

25(c) The department shall not delegate any of its responsibilities
26assumed pursuant to the federal laws described in subdivision (a)
27to any political subdivision of the state or its instrumentalities.

begin delete end deletebegin delete

28(d) The department shall, no later than January 1, 2016, submit
29a report to the Legislature that includes the following:

end delete
begin delete end deletebegin delete end deletebegin delete

30(1) A comparative analysis of the environmental review process
31under the National Environmental Policy Act (Chapter 55
32(commencing with Section 4321) of Title 42 of the United States
33Code) for the 30 projects, excluding those projects categorically
34excluded from environmental review, undertaken immediately
35preceding the enactment of this section that involved the Federal
36Highway Administration and the environmental review process
37for all projects, excluding those projects categorically excluded
38from environmental review, undertaken following the enactment
39of this section that did not involve the Federal Highway
P41   1Administration. This analysis shall include department- and local
2agency-sponsored projects, and shall address the following:

end delete
begin delete end deletebegin delete end deletebegin delete

3(A) For each project included in the analysis, the environmental
4review process under the National Environmental Policy Act,
5including which state and federal agencies reviewed the
6environmental documents and the amount of time the documents
7were reviewed by each agency, shall be described.

end delete
begin delete end deletebegin delete end deletebegin delete

8(B) The points in the environmental review process under the
9National Environmental Policy Act when project delays occurred
10and the nature of the delays.

end delete
begin delete end deletebegin delete end deletebegin delete

11(C) The time saved in the environmental review process for
12projects undertaken following the enactment of this section in
13comparison to the review process for projects undertaken prior to
14the enactment of this section, and the points in the review process
15when time was saved.

end delete
begin delete end deletebegin delete end deletebegin delete

16(D) The circumstances when the Federal Highway
17Administration hindered and facilitated project delivery.

end delete
begin delete end deletebegin delete end deletebegin delete

18(2) All financial costs incurred by the department to assume the
19responsibilities pursuant to Section 326 of, and subsection (a) of
20Section 327 of, Title 23 of the United States Code, including, but
21not limited to, the following:

end delete
begin delete end deletebegin delete end deletebegin delete

22(A) Personnel to conduct and review environmental documents
23and to manage litigation.

end delete
begin delete end deletebegin delete end deletebegin delete

24(B) Administrative costs.

end delete
begin delete end deletebegin delete end deletebegin delete

25(C) Litigation.

end delete
begin delete end deletebegin delete end deletebegin delete

26(3) An explanation of all litigation initiated against the
27department for the responsibilities assumed pursuant to Section
28326 of, and subsection (a) of Section 327 of, Title 23 of the United
29States Code.

end delete
begin delete end deletebegin delete end deletebegin delete

30(4) A comparison of all costs and benefits of assuming these
31responsibilities.

end delete
begin delete end deletebegin delete end deletebegin delete

32(5) An assessment of overall project delivery time from the time
33environmental studies begin to the time the project is ready to
34advertise for construction, including the time required for each
35project phase and distinguishing between different types of
36environmental documents and between projects on the state
37highway system and local assistance projects. The department may
38also include other variables that it determines may be useful in the
39assessment.

end delete
begin delete end deletebegin delete end deletebegin delete

P42   1(e) (1) This section shall remain in effect only until January 1,
22017, and as of that date is repealed, unless a later enacted statute,
3that is enacted before January 1, 2017, deletes or extends that date.

end delete
begin delete end deletebegin delete end deletebegin delete

4(2) The state shall remain liable for any decisions made, or
5responsibilities assumed and exercised, prior to the repeal of this
6section under this subdivision, pursuant to applicable federal
7statutes of limitation for filing citizens’ suits in federal court.

end delete
begin delete end deletebegin delete

8(f)

end delete

9begin insert(d)end insert Nothing in this section affects the obligation of the
10department to comply with state and federal law.

11

SEC. 24.  

Chapter 2 (commencing with Section 2030) is added
12to Division 3 of the Streets and Highways Code, to read:

13 

14Chapter  2. Road Maintenance and Rehabilitation
15Program
16

 

17

2030.  

(a) The Road Maintenance and Rehabilitation Program
18is hereby created to address deferred maintenance on the state
19highway system and the local street and road system. Funds made
20available by the program shall be prioritized for expenditure on
21basic road maintenance and road rehabilitation projects, and on
22critical safety projects. For funds appropriated pursuant to
23paragraph (1) of subdivision (d) of Section 2032, the California
24Transportation Commission shall adopt performance criteria,
25consistent with the asset management plan required pursuant to
2614526.4 of the Government Code, to ensure efficient use of the
27funds available for these purposes in the program.

28(b) (1) Funds made available by the program shall be used for
29 projects that include, but are not limited to, the following:

30(A) Road maintenance and rehabilitation.

31(B) Safety projects.

32(C) Railroad grade separations.

33(D) Complete street components, including active transportation
34purposes, pedestrian and bicycle safety projects, transit facilities,
35and drainage and stormwater capture projects in conjunction with
36any other allowable project.

37(E) Traffic control devices.

38(2) Funds made available by the program may also be used to
39satisfy a match requirement in order to obtain state or federal funds
40for projects authorized by this subdivision.

P43   1

2031.  

The following revenues shall be deposited in the Road
2Maintenance and Rehabilitation Account, which is hereby created
3in the State Transportation Fund:

4(a) Notwithstanding subdivision (b) of Section 2103, the portion
5of the revenues in the Highway Users Tax Account attributable to
6the increase in the motor vehicle fuel excise tax by seventeen cents
7($0.17) per gallon pursuant to subdivision (a) of Section 7360 of
8the Revenue and Taxation Code, as adjusted pursuant to
9subdivision (c) of that section.

10(b) The revenues from the increase in the vehicle registration
11fee pursuant to Section 9250.3 of the Vehicle Code.

12(c) The revenues from the increase in the vehicle registration
13fee pursuant to Section 9250.6 of the Vehicle Code.

14(d) The revenues deposited in the account pursuant to Section
15183.1 of the Streets and Highways Code.

16(e) Any other revenues designated for the program.

17

2031.5.  

Each fiscal year the annual Budget Act shall contain
18an appropriation from the Road Maintenance and Rehabilitation
19Account to the Controller for the costs of carrying out his or her
20duties pursuant to this chapter and to the California Transportation
21Commission for the costs of carrying out its duties pursuant to this
22chapter and Section 14526.7 of the Government Code.

23

2032.  

(a) (1) After deducting the amounts appropriated in the
24annual Budget Act, as provided in Section 2031.5, two hundred
25million dollars ($200,000,000) of the remaining revenues deposited
26in the Road Maintenance and Rehabilitation Account shall be set
27aside annually for counties that have sought and received voter
28approval of taxes or that have imposed fees, including uniform
29developer fees as defined by subdivision (b) of Section 8879.67
30of the Government Code, which taxes or fees are dedicated solely
31to transportation improvements. The Controller shall each month
32set aside one-twelfth of this amount, to accumulate a total of two
33hundred million dollars ($200,000,000) in each fiscal year.

34(2) Notwithstanding Section 13340 of the Government Code,
35the funds available under this subdivision in each fiscal year are
36hereby continuously appropriated for allocation to each eligible
37county and each city in the county for road maintenance and
38rehabilitation purposes pursuant to Section 2033.

39(b) (1) After deducting the amounts appropriated in the annual
40Budget Act pursuant to Section 2031.5 and the amount allocated
P44   1in subdivision (a), beginning in the 2017-18 fiscal year, eighty
2million dollars ($80,000,000) of the remaining revenues shall be
3transferred annually to the State Highway Account for expenditure,
4upon appropriation by the Legislature, on the Active Transportation
5Program created pursuant to Chapter 8 (commencing with Section
62380) of Division 3 to be allocated by the California Transportation
7Commission pursuant to Section 2381.

8(2) In addition to the funds transferred in paragraph (1), the
9department shall annually identify savings achieved through
10efficiencies implemented at the department. The department,
11through the annual budget process, shall propose, from the
12identified savings, an appropriation to be included in the annual
13Budget Act of up to seventy million dollars ($70,000,000), but not
14to exceed the total annual identified savings, from the State
15Highway Account for expenditure on the Active Transportation
16Program.

17(c) After deducting the amounts appropriated in the annual
18Budget Act pursuant to Section 2031.5, the amount allocated in
19subdivision (a) and the amount transferred in paragraph (1) of
20subdivision (b), in the 2017-18, 2018-19, 2019-20, and 2020-21
21fiscal years, the sum of thirty million dollars ($30,000,000) in each
22fiscal year from the remaining revenues shall be transferred to the
23Advance Mitigation Fund in the State Transportation Fund created
24pursuant to Section 21207 of the Public Resources Code.

25(d) After deducting the amounts appropriated in the annual
26Budget Act pursuant to Section 2031.5, the amount allocated in
27subdivision (a), and the amounts transferred in paragraph (1) of
28subdivision (b) and in subdivision (c), beginning in the 2017-18
29fiscal year and each fiscal year thereafter, and notwithstanding
30Section 13340 of the Government Code, there is hereby
31continuously appropriated to the California State University the
32sum of two million dollars ($2,000,000) from the remaining
33revenues for the purpose of conducting transportation research and
34transportation-related workforce education, training, and
35development. Prior to the start of each fiscal year, the chairs of the
36Assembly Committee on Transportation and the Senate Committee
37on Transportation and Housing shall confer and set out a
38recommended priority list of research components to be addressed
39in the upcoming fiscal year.

P45   1(e) Notwithstanding Section 13340 of the Government Code,
2the balance of the revenues deposited in the Road Maintenance
3and Rehabilitation Account are hereby continuously appropriated
4as follows:

5(1) Fifty percent for allocation to the department for maintenance
6of the state highway system or for purposes of the state highway
7operation and protection program.

8(2) Fifty percent for apportionment to cities and counties by the
9Controller pursuant to the formula in clauses (i) and (ii) of
10subparagraph (C) of paragraph (3) of subdivision (a) of Section
112103 for the purposes authorized by this chapter.

12

2033.  

(a) On or before January 1, 2017, the commission, in
13cooperation with the department, transportation planning agencies,
14county transportation commissions, and other local agencies, shall
15develop guidelines for the allocation of funds pursuant to
16subdivision (a) of Section 2032.

17(b) The guidelines shall be the complete and full statement of
18the policy, standards, and criteria that the commission intends to
19use to determine how these funds will be allocated.

20(c) The commission may amend the adopted guidelines after
21conducting at least one public hearing.

22

2034.  

(a) (1) Prior to receiving an apportionment of funds
23under the program pursuant to paragraph (2) of subdivision (d) of
24Section 2032 from the Controller in a fiscal year, an eligible city
25or county shall submit to the commission a list of projects proposed
26to be funded with these funds pursuant to an adopted city or county
27budget. All projects proposed to receive funding shall be included
28in a city or county budget that is adopted by the applicable city
29council or county board of supervisors at a regular public meeting.
30The list of projects proposed to be funded with these funds shall
31include a description and the location of each proposed project, a
32proposed schedule for the project’s completion, and the estimated
33useful life of the improvement. The project list shall not limit the
34 flexibility of an eligible city or county to fund projects in
35accordance with local needs and priorities so long as the projects
36are consistent with subdivision (b) of Section 2030.

37(2) The commission shall report to the Controller the cities and
38counties that have submitted a list of projects as described in this
39subdivision and that are therefore eligible to receive an
40apportionment of funds under the program for the applicable fiscal
P46   1year. The Controller, upon receipt of the report, shall apportion
2funds to eligible cities and counties.

3(b) For each fiscal year, each city or county receiving an
4apportionment of funds shall, upon expending program funds,
5submit documentation to the commission that includes a description
6and location of each completed project, the amount of funds
7expended on the project, the completion date, and the estimated
8useful life of the improvement.

9

2036.  

(a) Cities and counties shall maintain their existing
10commitment of local funds for street, road, and highway purposes
11in order to remain eligible for an allocation or apportionment of
12funds pursuant to Section 2032.

13(b) In order to receive an allocation or apportionment pursuant
14to Section 2032, the city or county shall annually expend from its
15general fund for street, road, and highway purposes an amount not
16less than the annual average of its expenditures from its general
17fund during the 2009-10, 2010-11, and 2011-12 fiscal years, as
18reported to the Controller pursuant to Section 2151. For purposes
19of this subdivision, in calculating a city’s or county’s annual
20general fund expenditures and its average general fund expenditures
21for the 2009-10, 2010-11, and 2011-12 fiscal years, any
22unrestricted funds that the city or county may expend at its
23discretion, including vehicle in-lieu tax revenues and revenues
24from fines and forfeitures, expended for street, road, and highway
25purposes shall be considered expenditures from the general fund.
26One-time allocations that have been expended for street and
27highway purposes, but which may not be available on an ongoing
28basis, including revenue provided under the Teeter Plan Bond Law
29of 1994 (Chapter 6.6 (commencing with Section 54773) of Part 1
30of Division 2 of Title 5 of the Government Code), may not be
31considered when calculating a city’s or county’s annual general
32fund expenditures.

33(c) For any city incorporated after July 1, 2009, the Controller
34shall calculate an annual average expenditure for the period
35between July 1, 2009, and December 31, 2015, inclusive, that the
36city was incorporated.

37(d) For purposes of subdivision (b), the Controller may request
38fiscal data from cities and counties in addition to data provided
39pursuant to Section 2151, for the 2009-10, 2010-11, and 2011-12
40fiscal years. Each city and county shall furnish the data to the
P47   1Controller not later than 120 days after receiving the request. The
2Controller may withhold payment to cities and counties that do
3not comply with the request for information or that provide
4incomplete data.

5(e) The Controller may perform audits to ensure compliance
6with subdivision (b) when deemed necessary. Any city or county
7that has not complied with subdivision (b) shall reimburse the state
8for the funds it received during that fiscal year. Any funds withheld
9or returned as a result of a failure to comply with subdivision (b)
10shall be reapportioned to the other counties and cities whose
11expenditures are in compliance.

12(f) If a city or county fails to comply with the requirements of
13subdivision (b) in a particular fiscal year, the city or county may
14expend during that fiscal year and the following fiscal year a total
15amount that is not less than the total amount required to be
16expended for those fiscal years for purposes of complying with
17subdivision (b).

18

2037.  

A city or county may spend its apportionment of funds
19under the program on transportation priorities other than those
20allowable pursuant to this chapter if the city’s or county’s average
21Pavement Condition Index meets or exceeds 80.

22

2038.  

(a) The department and local agencies, as a condition
23of receiving funds from the program, shall adopt and implement
24a program designed to promote and advance construction
25employment and training opportunities through preapprenticeship
26opportunities, either by the public agency itself or through
27contractors engaged by the public agencies to do work funded in
28whole or in part by funds made available by the program.

29(b) The department and local agencies, as a condition of
30receiving funds from the program, shall ensure the involvement
31of the California Conservation Corps and certified community
32conservation corps in the delivery of projects and services funded
33in whole or in part by funds made available by the program.

34

SEC. 25.  

Section 2103.1 is added to the Streets and Highways
35Code
, to read:

36

2103.1.  

(a) Notwithstanding Section 2103, the revenues
37transferred to the Highway Users Tax Account pursuant to Sections
388352.4, 8352.5, and 8352.6 of the Revenue and Taxation Code
39shall be distributed pursuant to the formula in paragraph (3) of
40subdivision (a) of Section 2103.

P48   1(b) Notwithstanding subdivision (b) of Section 2103, the portion
2of revenues in the Highway Users Tax Account attributable to the
3increase in the motor vehicle fuel excise tax by seventeen cents
4($0.17) per gallon pursuant to subdivision (a) of Section 7360 of
5the Revenue and Taxation Code, as adjusted pursuant to
6subdivision (c) of that section, shall be transferred to the Road
7Maintenance and Rehabilitation Account pursuant to Section 2031.

8(c) Notwithstanding subdivision (b) of Section 2103, the portion
9of revenues in the Highway Users Tax Account attributable to the
10increase in the diesel fuel excise tax by thirty cents ($0.30) per
11gallon pursuant to subdivision (b) of Section 60050 of the Revenue
12and Taxation Code, as adjusted pursuant to subdivision (c) of that
13section, shall be transferred to the Trade Corridors Improvement
14Fund pursuant to Section 2192.4.

15

SEC. 26.  

Section 2192 of the Streets and Highways Code is
16amended to read:

17

2192.  

(a) begin insert(1)end insertbegin insertend insertThe Trade Corridors Improvement Fund, created
18pursuant to subdivision (c) of Section 8879.23 of the Government
19Code, is hereby continued in existence to receive revenues from
20begin insert stateend insert sources other than the Highway Safety, Traffic Reduction,
21Air Quality, and Port Security Bond Act of 2006.begin delete This chapter
22shall govern expenditure of those other revenues.end delete

begin insert

23
(2) Revenues apportioned to the state under Section 167 of Title
2423 of the United States Code from the national highway freight
25program, pursuant to the federal Fixing America’s Surface
26Transportation Act (“FAST Act,” Public Law 114-94) shall be
27allocated for projects approved pursuant to this chapter.

end insert
begin insert

28
(b) This chapter shall govern the expenditure of those state and
29federal revenues described in subdivision (a).

end insert
begin delete

30(b) The moneys in the fund from these other sources

end delete

31begin insert(c)end insertbegin insertend insertbegin insertThe funding described in subdivision (a)end insert shall be available
32upon appropriation for allocation by the California Transportation
33Commission for infrastructure improvements in this state on
34federally designated Trade Corridors of National and Regional
35Significance, on the Primary Freight Network, and along other
36corridors that have a high volume of freight movement, as
37determined by the commission. In determining the projects eligible
38for funding, the commission shall consult the Transportation
39Agency’s state freight plan as described in Section 13978.8 of the
40Governmentbegin delete Code, the State Air Resources Board’s Sustainable
P49   1Freight Strategy adopted by Resolution 14-2,end delete
begin insert Codeend insert and the trade
2infrastructure and goods movement plan submitted to the
3commission by the Secretary of Transportation and the Secretary
4for Environmental Protection. The commission shall also consult
5trade infrastructure and goods movement plans adopted by regional
6transportation planning agencies, adopted regional transportation
7plans required by state and federal law, and thebegin delete statewideend delete
8begin insert applicableend insert port master planbegin delete prepared by the California Marine and
9Intermodal Transportation System Advisory Council
10(Cal-MITSAC) pursuant to Section 1730 of the Harbors and
11Navigation Code,end delete
when determining eligible projects for funding.
12Eligible projects for these funds include, but are not limited to, all
13of the following:

14(1) Highway capacitybegin insert improvements, rail landside access
15improvements, landside freight accessend insert
improvementsbegin insert to airports,end insert
16 and operational improvements to more efficiently accommodate
17the movement of freight, particularly for ingress and egress to and
18from the state’s land ports ofbegin delete entryend deletebegin insert entry, rail terminals,end insert and
19seaports, including navigable inland waterways used to transport
20freight between seaports, land ports of entry, and airports, and to
21relieve traffic congestion along major trade or goods movement
22corridors.

23(2) Freight rail system improvements to enhance the ability to
24move goods from seaports, land ports of entry, and airports to
25warehousing and distribution centers throughout California,
26including projects that separate rail lines from highway or local
27road traffic, improve freight rail mobility through mountainous
28regions, relocate rail switching yards, and other projects that
29improve the efficiency and capacity of the rail freight system.

30(3) Projects to enhance the capacity and efficiency of ports.

31(4) Truck corridorbegin insert and capital and operationalend insert improvements,
32including dedicated truck facilities or truck toll facilities.

33(5) Borderbegin delete accessend deletebegin insert capital and operationalend insert improvements that
34enhance goods movement between California and Mexico and that
35maximize the state’s ability to accessbegin delete coordinated border
36infrastructureend delete
funds made available to the state by federal law.

37(6) Surface transportation and connector road improvements to
38effectively facilitate the movement of goods, particularly for
39ingress and egress to and from the state’s land ports of entry,
P50   1airports, and seaports, to relieve traffic congestion along major
2trade or goods movement corridors.

begin delete

3(c) (1) The

end delete

4begin insert(d)end insertbegin insertend insertbegin insert(1)end insertbegin insertend insertbegin insertExcept as provided in paragraph (2), theend insert commission
5shall allocatebegin delete fundsend deletebegin insert the funding described in subdivision (a)end insert for
6trade infrastructure improvementsbegin delete from the fundend delete consistent with
7Section 8879.52 of the Government Code and the Trade Corridors
8Improvement Fund (TCIF) Guidelines adopted by the commission
9on November 27, 2007, or as amended by the commission, and in
10a manner that (A) addresses the state’s most urgent needs, (B)
11balances the demands of various land ports of entry, seaports, and
12airports, (C) provides reasonable geographic balance between the
13state’s regions,begin delete andend delete (D) places emphasis on projects that improve
14trade corridor mobilitybegin insert and safetyend insert while reducing emissions of
15diesel particulate and other pollutantbegin delete emissions.end deletebegin insert emissions and
16reducing other negative community impacts, and (E) makes a
17significant contribution to the state’s economy.end insert

begin insert

18
(2) The commission shall allocate the federal freight funding,
19specifically, pursuant to the original TCIF Guidelines, as adopted
20by the commission on November 27, 2007, and in the manner
21described in (A) to (E), inclusive, of paragraph (1).

end insert
begin delete

22(2)

end delete

23begin insert(3)end insert In addition, the commission shall also consider the following
24factors when allocating these funds:

25(A) “Velocity,” which means the speed by which large cargo
26would travel from the land port of entry or seaport through the
27distribution system.

28(B) “Throughput,” which means the volume of cargo that would
29move from the land port of entry or seaport through the distribution
30system.

31(C) “Reliability,” which means a reasonably consistent and
32predictable amount of time for cargo to travel from one point to
33another on any given day or at any given time in California.

34(D) “Congestion reduction,” which means the reduction in
35recurrent daily hours of delay to be achieved.

36

SEC. 27.  

Section 2192.1 of the Streets and Highways Code is
37amended to read:

38

2192.1.  

(a) To the extent moneys from the Greenhouse Gas
39Reduction Fund, attributable to the auction or sale of allowances
40as part of a market-based compliance mechanism relative to
P51   1reduction of greenhouse gas emissions, are transferred to the Trade
2Corridors Improvement Fund, projects funded with those moneys
3shall be subject to all of the requirements of existing law applicable
4to the expenditure of moneys appropriated from the Greenhouse
5Gas Reduction Fund, including, but not limited to,begin delete bothend deletebegin insert allend insert of the
6following:

7(1) Projects shall further the regulatory purposes of the
8California Global Warming Solutions Act of 2006 (Division 25.5
9(commencing with Section 38500) of the Health and Safety Code),
10including reducing emissions from greenhouse gases in the state,
11directing public and private investment toward disadvantaged
12communities, increasing the diversity of energy sources, or creating
13opportunities for businesses, public agencies, nonprofits, and other
14community institutions to participate in and benefit from statewide
15efforts to reduce emissions of greenhouse gases.

16(2) Projects shall be consistent with the guidance developed by
17the State Air Resources Board pursuant to Section 39715 of the
18Health and Safety Code.

begin insert

19
(3) Projects shall be consistent with the required benefits to
20disadvantaged communities pursuant to Section 39713 of the
21Health and Safety Code.

end insert

22(b) All allocations of funds made by the commission pursuant
23to this section shall be made in a manner consistent with the criteria
24expressed in Section 39712 of the Health and Safety Code and
25with the investment plan developed by the Department of Finance
26pursuant to Section 39716 of the Health and Safety Code.

begin insert

27
(c) For purposes of this section, “disadvantaged community”
28means a community with any of the following characteristics:

end insert
begin insert

29
(1) An area with a median household income less than 80
30percent of the statewide median household income based on the
31most current census tract-level data from the American Community
32Survey.

end insert
begin insert

33
(2) An area identified by the California Environmental
34Protection Agency pursuant to Section 39711 of the Health and
35Safety Code.

end insert
begin insert

36
(3) An area where at least 75 percent of public school students
37are eligible to receive free or reduced-price meals under the
38National School Lunch Program.

end insert
39

SEC. 28.  

Section 2192.2 of the Streets and Highways Code is
40amended to read:

P52   1

2192.2.  

The commission shall allocate funds made available
2by this chapter to projects that have identified and committed
3supplemental funding from appropriate local, federal, or private
4sources. The commission shall determine the appropriate amount
5of supplemental funding each project should have to be eligible
6for moneysbegin delete from the fundend delete based on a project-by-project review
7and an assessment of the project’s benefit to the state and the
8program.begin delete Except for border accessend deletebegin insert Fundedend insert improvementsbegin delete described
9in paragraph (5) of subdivision (b) of Section 2192, improvements
10funded with moneys from the fundend delete
shall have supplemental funding
11that is at least equal to the amount of the contributionbegin delete from the
12fund.end delete
begin insert under this chapter.end insert The commission may give priority for
13funding to projects with higher levels of committed supplemental
14funding.

15

SEC. 29.  

Section 2192.4 is added to the Streets and Highways
16Code
, to read:

17

2192.4.  

Notwithstanding subdivision (b) of Section 2103, the
18portion of the revenues in the Highway Users Tax Account
19attributable to the increase in the diesel fuel excise tax by thirty
20cents ($0.30) per gallon pursuant to subdivision (b) of Section
2160050 of the Revenue and Taxation Code, as adjusted pursuant to
22subdivision (c) of that section, shall be deposited in the Trade
23Corridors Improvement Fund.

24

SEC. 30.  

Section 9250.3 is added to the Vehicle Code, to read:

25

9250.3.  

(a) In addition to any other fees specified in this code
26or the Revenue and Taxation Code, commencing 120 days after
27the effective date of the act adding this section, a registration fee
28of thirty-eight dollars ($38) shall be paid to the department for
29registration or renewal of registration of every vehicle subject to
30registration under this code, except those vehicles that are expressly
31exempted under this code from payment of registration fees.

32(b) Beginning July 1, 2019, and every third year thereafter, the
33Department of Motor Vehicles shall adjust the fee imposed under
34this section for inflation in an amount equal to the change in the
35California Consumer Price Index for the prior three-year period,
36as calculated by the Department of Finance, with amounts equal
37to or greater than fifty cents ($0.50) rounded to the next highest
38whole dollar.

39(c) Revenues from the fee, after the deduction of the
40department’s administrative costs related to this section, shall be
P53   1deposited in the Road Maintenance and Rehabilitation Account
2created pursuant to Section 2031 of the Streets and Highways
3Code.

4

SEC. 31.  

Section 9250.6 is added to the Vehicle Code, to read:

5

9250.6.  

(a) In addition to any other fees specified in this code,
6or the Revenue and Taxation Code, commencing 120 days after
7the effective date of the act adding this section, a registration fee
8of one hundred and sixty-five dollars ($165) shall be paid to the
9department for registration or renewal of registration of every
10zero-emission motor vehicle subject to registration under this code,
11except those motor vehicles that are expressly exempted under
12this code from payment of registration fees.

13(b) Beginning July 1, 2019, and every third year thereafter, the
14Department of Motor Vehicles shall adjust the fee imposed under
15this section for inflation in an amount equal to the change in the
16California Consumer Price Index for the prior three-year period,
17 as calculated by the Department of Finance, with amounts equal
18to or greater than fifty cents ($0.50) rounded to the next highest
19whole dollar.

20(c) Revenues from the fee, after deduction of the department’s
21administrative costs related to this section, shall be deposited in
22the Road Maintenance and Rehabilitation Account created pursuant
23to Section 2031 of the Streets and Highways Code.

24(d) This section does not apply to a commercial motor vehicle
25subject to Section 9400.1.

26(e) The registration fee required pursuant to this section does
27not apply to the initial registration after the purchase of a new
28zero-emission motor vehicle.

29(f) For purposes of this section, “zero-emission motor vehicle”
30means a motor vehicle as described in subdivisions (c) and (d) of
31Section 44258 of the Health and Safety Code, or any other motor
32vehicle that is able to operate on any fuel other than gasoline or
33diesel fuel.

34

SEC. 32.  

Section 9400.5 is added to the Vehicle Code, to read:

35

9400.5.  

(a) Notwithstanding Sections 9400.1, 9400.4, and
3642205 of this code, Sections 16773 and 16965 of the Government
37Code, Section 2103 of the Streets and Highways Code, or any
38other law, weight fee revenues shall only be transferred consistent
39with the schedule provided in subdivision (b) from the State
40Highway Account to the Transportation Debt Service Fund, the
P54   1Transportation Bond Direct Payment Account, or any other fund
2or account for the purpose of payment of the debt service on
3transportation general obligation bonds and shall not be loaned to
4the General Fund.

5(b) (1) The transfer of weight fee revenues, after deduction of
6collection costs, from the State Highway Account pursuant to
7subdivision (a) shall not exceed:

8(A) 80 percent of the total weight fees in the 2017-18 fiscal
9year.

10(B) 60 percent of the total weight fees in the 2018-19 fiscal
11year.

12(C) 40 percent of the total weight fees in the 2019-20 fiscal
13year.

14(D) 20 percent of the total weight fees in the 2020-2021 fiscal
15year.

16(2) No weight fees, after deduction of collection costs, shall be
17transferred from the State Highway Account after the 2020-21
18fiscal year.

19

SEC. 33.  

This act is an urgency statute necessary for the
20immediate preservation of the public peace, health, or safety within
21the meaning of Article IV of the Constitution and shall go into
22immediate effect. The facts constituting the necessity are:

23In order to provide additional funding for road maintenance and
24rehabilitation purposes as quickly as possible, it is necessary for
25this act to take effect immediately.



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