BILL ANALYSIS                                                                                                                                                                                                    

                                                                       AB 194

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          194 (Frazier)

          As Amended  June 1, 2015

          Majority vote

          |Committee       |Votes |Ayes                |Noes                  |
          |                |      |                    |                      |
          |                |      |                    |                      |
          |Transportation  |14-1  |Frazier, Achadjian, |Kim                   |
          |                |      |Baker, Bloom,       |                      |
          |                |      |Campos, Chu, Daly,  |                      |
          |                |      |Dodd, Gomez,        |                      |
          |                |      |Linder, Medina,     |                      |
          |                |      |Melendez, Nazarian, |                      |
          |                |      |O'Donnell           |                      |
          |                |      |                    |                      |
          |Appropriations  |11-3  |Gomez, Bonta,       |Bigelow, Jones,       |
          |                |      |Calderon, Daly,     |Wagner                |
          |                |      |Eggman,             |                      |
          |                |      |                    |                      |
          |                |      |                    |                      |
          |                |      |Eduardo Garcia,     |                      |
          |                |      |Gordon, Holden,     |                      |
          |                |      |Quirk, Rendon, Wood |                      |
          |                |      |                    |                      |
          |                |      |                    |                      |


                                                                       AB 194

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          SUMMARY:  Extends indefinitely the California Transportation  
          Commission's (CTC's) authority to authorize regional  
          transportation agencies to develop and operate high-occupancy toll  
          (HOT) lanes and expands the authority to include other toll  
          facilities; adds similar authority for the CTC to authorize the  
          California Department of Transportation (Caltrans) to develop toll  
          facilities.  Specifically, this bill:  
          1)Makes legislative findings and declarations regarding the  
            potential benefits of toll facilities.
          2)Sets forth a process whereby Caltrans can apply to CTC for  
            authorization to develop and operate HOT lanes and other toll  

          3)Extends indefinitely the process whereby CTC reviews and  
            approves applications from regional transportation agencies, in  
            cooperation with Caltrans, to develop and operate HOT lanes and  
            other toll facilities, including preferential lanes for transit  
            and freight.  

          4)Deletes the limitation on the number (four) of HOT lane  
            applications CTC may approve, thereby granting open-ended  
            authority to approve applications.  

          5)Directs CTC to develop guidelines to evaluate and approve  
            applications submitted by regional transportation agencies for  
            the development and operation of HOT lanes and other toll  
            facilities, subject to specific minimum requirements.

          6)Explicitly provides that the authority being granted to develop  
            toll facilities does not prevent other agencies from  
            constructing facilities that compete with a toll facility.  

          7)Authorizes regional transportation agencies to bond against toll  


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          8)Requires a regional transportation agency to give a local  
            transportation agency within its jurisdiction the option to  
            enter into an agreement to govern a toll project authorized  
            under provisions of this bill.

          FISCAL EFFECT:  According to the Assembly Appropriations  
          Committee, based on substantially similar legislation in 2014, the  
          CTC will need to update its guidelines for HOT lanes and implement  
          and oversee the approval process, as well as perform independent  
          financial analysis and operational analysis of HOT lane  
          applications.  Ongoing costs for one senior-level position would  
          be around $190,000 (State Highway Account), and consulting costs  
          to review each application would be around $300,000.  The  
          consulting costs would be reimbursed for applications by regional  
          transportation agencies.

          COMMENTS:  HOT lanes are increasingly being implemented in  
          metropolitan areas around the state and the nation, primarily to  
          deal with increased congestion.  HOT lanes allow single-occupant  
          or lower-occupancy vehicles to use a high-occupancy vehicle (HOV)  
          lane for a fee, while maintaining free or reduced travel to  
          qualifying HOVs.  The acknowledged benefits of HOT lanes include  
          enhanced mobility and travel options in congested corridors and  
          better usage of underutilized HOV lanes.  

          This bill expands the potential for toll facilities in California  
          by granting CTC broad, indefinite authority to review and approve  
          toll facility applications submitted by regional transportation  
          agencies and by Caltrans.  This bill builds on the authority  
          previously granted to regional transportation agencies and is  
          consistent with protocols that have evolved to guide development  
          of the HOT lane programs, such as the requirement that any excess  
          revenue be used in the corridor in which it was generated.


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          Regional transportation agencies up and down the state, as well as  
          Caltrans, struggle with meeting the challenges of increasing  
          traffic congestion and decreasing transportation revenue.   
          Although HOT lanes should be primarily a congestion management  
          tool, they may have the added benefit of generating net revenue  
          that can be put back into the corridor from which it was generated  
          for additional improvements or other benefits.  Given the success  
          of multiple HOT lane demonstration programs to date, it is  
          appropriate now to provide an administrative process whereby  
          regional transportation agencies and Caltrans can work together  
          with CTC to develop and operate toll facilities.  

          This bill defines clear roles and responsibilities between  
          Caltrans and regional transportation agencies in the development  
          of toll facilities.  In cooperation with one another, this bill  
          appropriately places control of a facility's tolling policy and  
          toll revenue with whatever agency is bearing the responsibility  
          and financial risk to develop the program, under prescribed  
          requirements.  Furthermore, this bill includes provisions that  
          ensure that not only do Caltrans and regional transportation  
          agencies work cooperatively but that a regional transportation  
          agency and local transportation agencies within its jurisdiction  
          work cooperatively as well.  Finally, this bill makes it clear  
          that the authority to develop toll lanes does not in any way  
          include the conversion of existing non-tolled or nonuser-fee lanes  
          into tolled or user-fee lanes, either by authorizing them or  
          prohibiting them.  Any efforts to implement such a conversion will  
          require separate statutory authority.

          Please see the policy committee analysis for full discussion of  
          this bill.


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          Analysis Prepared by:                                               
                          Janet Dawson / TRANS. / (916) 319-2093  FN: