BILL ANALYSIS Ó
AB 906
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ASSEMBLY THIRD READING
AB
906 (Cooper)
As Introduced February 26, 2015
Majority vote
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|Committee |Votes |Ayes |Noes |
| | | | |
| | | | |
|----------------+------+--------------------+----------------------|
|Local |6-3 |Maienschein, |Cooley, Gordon, |
|Government | |Gonzalez, Alejo, |Waldron |
| | |Chiu, Holden, | |
| | |Linder | |
| | | | |
| | | | |
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SUMMARY: Makes changes to the proportionate share payment in
existing law that the City of Elk Grove must fulfill to maintain
an appointment of a director to Sacramento Regional Transit
District's (RT) Board of Directors. Specifically, this bill:
1)Makes changes to the proportionate share payment in existing law
that the City of Elk Grove must fulfill to become a
participating entity and maintain a seat on RT's governing body.
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2)Requires the proportionate share for the City of Elk Grove to be
deemed fully satisfied through RT's receipt from the Sacramento
Transportation Authority of transaction and use tax revenues
from Measure A, as approved by the voters in November 2004, and
effective as of April 2009.
3)Repeals existing law, which requires the City of Elk Grove's
proportionate share to be determined in the manner provided in
First Amendment, Section 4B(2) to Interim Agreement for Elk
Grove Bus Service, dated March 17, 2004, between RT and Elk
Grove.
4)Provides that no further agreement between the City of Elk Grove
and RT is required.
EXISTING LAW:
1)Establishes the Sacramento Regional Transit District Act which
governs the powers and functions of RT, and establishes RT's
territory and board of directors (Board).
2)Authorizes RT to comprise of the Cities of Citrus Heights, Elk
Grove, Davis, Folsom, Rancho Cordova, Roseville, Sacramento,
West Sacramento, and Woodland, and specified territory in
Sacramento and Yolo Counties to the extent they are not included
in the above-mentioned cities.
3)Provides any city or county may annex to and become part of RT,
upon approval by the Board, following a written request by that
city or county and approval of the Sacramento Area Council of
Governments.
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4)Authorizes a city or county that is not annexed to RT to become
a participating entity entitled to make at least one appointment
to the Board, if the participating entity enters into an
agreement with RT that provides for all of the following:
a) The participating entity agrees to pay its proportionate
share of RT's cost to provide rail or other districtwide
transit services;
b) RT agrees to maintain a specified level of rail or other
districtwide transit services; and,
c) RT is not obligated to provide transit services to any
particular location or along any particular route.
5)Requires the City of Elk Grove's proportionate share, for the
purposes of 4) above, to be determined in the manner provided in
First Amendment, Section 4B(2) to Interim Agreement for Elk
Grove Bus Service, dated March 17, 2004, between RT and Elk
Grove.
6)Provides that a participating entity's seat on the Board shall
terminate upon termination or cancellation of the agreement in
4), above.
7)Establishes a weighted voting procedure for RT's Board.
8)Defines a member entity to mean a city or county that is annexed
to RT pursuant to 2), and 3), above.
9)Defines a participating entity to mean a city or county that is
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not annexed to RT, but has entered into a specified agreement
pursuant to 4), above.
FISCAL EFFECT: None
COMMENTS:
1)RT. The Legislature authorized the creation of the Sacramento
Regional Transit District in 1971 to operate a comprehensive
public transportation system for the Sacramento region. RT
serves an area encompassing 418 square miles and 1.4 million
people; it operates 67 bus routes and 38.6 miles of light rail
service. RT is governed by an 11-member Board of Directors
comprised of eight directors that are appointed by the annexed
jurisdictions, which are "member entities," including Sacramento
County, and the Cities of Sacramento and Rancho Cordova.
Additionally, three directors are appointed by non-annexed
jurisdictions, which are "participating entities," including the
Cities of Citrus Heights, Elk Grove, and Folsom.
2)City of Elk Grove. The City of Elk Grove incorporated as a city
in 2001; prior to that time, RT provided transit services to
areas within Sacramento County that were included within Elk
Grove's boundaries. Following incorporation, Elk Grove opted to
not activate membership as an annexed part of RT, and instead,
entered into a service agreement, from 2001 to 2004, so that RT
would continue providing transit services. Upon further study,
Elk Grove decided to operate its own bus service within the city
and to contract with RT for regional transit services.
RT's enabling act did not allow Elk Grove to have a seat on the
Board, therefore, SB 466 (Steinberg), Chapter 620, Statutes of
2004, made several changes to RT's governance structure. SB 466
enabled Elk Grove to have a seat on the Board to vote on
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regional matters and allowed RT to recover operating costs from
providing regional transit services to Elk Grove. SB 466
required that the City of Elk Grove's proportionate share be
determined by First Amendment, Section 4B (2) to Interim
Agreement for Elk Grove Bus Service, dated March 17, 2004, an
agreement that RT and Elk Grove entered into. An analysis of SB
466, which listed both RT and Elk Grove in support, stated,
"Proponents state that the bill represents a consensus among RT,
Elk Grove, and transit labor representatives."
AB 2137 (Niello), Chapter 227, Statutes of 2008, created a
weighted voting system for RT based on membership status and
each voting entity's financial contribution. AB 2137 was also
supported by RT, Elk Grove, and several other cities, including
both member and participating entities.
3)Bill Summary. Current law allows a city or county that is not
annexed to RT to have a seat on RT's Board, if they enter into a
specified agreement with RT to pay their proportional share of
RT's costs to provide rail or other districtwide transit
services. Additionally, existing law requires that Elk Grove's
proportionate share is determined in the manner provided by an
Interim Agreement between the City of Elk Grove and RT. This
bill deletes the reference to the interim agreement, and
instead, deems that the City of Elk Grove's proportionate share
is satisfied through RT's receipt of transactions and use tax
revenues generated from Measure A (2004) and provides that no
further agreement between the City of Elk Grove and RT is
required.
Measure A was approved by over two-thirds of the voters in
Sacramento County to extend an existing transactions and use
tax. RT receives Measure A revenue for operation and
maintenance of transit capital and rail transit improvements, as
specified in the expenditure plan. Revenue generated by Measure
A also provides funding for things like pedestrian and bike
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facilities, traffic control and safety programs, and city street
road maintenance programs, which are distributed proportionality
to cities, including the City of Elk Grove. Since RT is already
in receipt of Measure A revenues, this bill would not result in
an additional allocation of funding for RT.
This bill is sponsored by the City of Elk Grove.
4)Author's Statement. According to the author, "This bill updates
the city of Elk Grove's proportionate share payment to RT to
reflect changes since Elk Grove incorporated as a city in 2000.
Currently, Elk Grove's proportionate share payment is based on
outdated state law and does not take into account Measure A
contributions by Elk Grove residents.
"The proportionate share payment Elk Grove pays to RT reflects a
time when the city did not operate its own transit service and
is not equitable to the city and its residents. Outdated state
law requires Elk Grove to pay twice in order to have one seat on
the RT Board. The proportionate share payment paid by Elk Grove
is determined solely by RT. However, RT also receives nearly
$35 million in annual Measure A revenues dedicated for transit
purposes from STA while Elk Grove receives none of the Measure A
revenues dedicated for transit because Measure A was enacted
before Elk Grove incorporated in (2000) and before the city
assumed local control over transit services (2010). Since
approximately 10% of all Measure A revenues come from Elk Grove
generated taxes, Elk Grove is already contributing 10% of the
annual $35 million (approximately $3.5 million annually) to RT
for transit services. This $3.5 million annual contribution
from Elk Grove to RT through the STA Measure is in addition to
the fair share payment to RT to participate on the Board in the
amount of $797,000 in Fiscal Year 2015-16. No other city in the
region pays twice for its regional transit use. In spite of
this double payment of $4.3 million dollars to RT, Elk Grove
residents still pay regular fare when boarding RT buses and
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light rail."
5)Policy Considerations. The Legislature may wish to consider the
following:
a) No Regional Consensus. The Legislature has supported
prior bills that revised RT's board membership to allow
non-annexed cities to have a seat on the Board and created
weighted voting, all of which were brought forward with
consensus. Without consensus, this bill creates winners and
losers in a district-specific issue.
b) Measure A. This bill allows Elk Grove to maintain their
seat on RT's Board at no cost to the City, except what their
residents are already contributing via countywide
transactions and use tax. Proponents argue that RT already
receives a large contribution from Elk Grove in annual
Measure A revenues that are dedicated for transit purposes,
while Elk Grove receives none of that revenue. If the core
policy issue is with the allocation of Measure A funds for
transit in Sacramento County, which was established in an
expenditure plan and passed by the voters in 2004, then the
Legislature may wish to consider if this bill is an
appropriate avenue to address those concerns.
c) Who Will Pay? The Legislature may wish to consider,
absent a proportionate share payment from Elk Grove, what the
potential impacts on services will be. Proponents argue that
the City may have to reduce its own bus services due to lack
of funding. However, this bill may require RT to reduce
services to other cities and counties that do fulfill their
payments to RTs. Additionally, the Legislature may wish to
consider if those who will be impacted the most are
individuals that may not have other resources and rely on
public transportation.
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6)Arguments in Support. Elk Grove argues, "Existing law requires
the City of Elk Grove to pay twice in order to have one seat on
the RT Board by having the City pay a proportionate share
payment determined solely by RT. Currently, RT receives nearly
$35 million in annual Measure A revenues (Elk Grove's
contribution is 10% to these revenue funds which equate to $3.5
million annually) dedicated for transit purposes from the
Sacramento Transportation Authority while the city of Elk Grove
receives none."
7)Arguments in Opposition. RT argues, "This bill would relieve
the City from its contractual proportionate share obligation
under our joint agreement for the services provided by deeming
the obligation satisfied by revenues already available to RT in
the form of tax revenues under Sacramento County Measure A. The
practical effect of this would be to reallocate the City's
proportionate costs for regional transit services provided by RT
among the other participating entities or RT and result in
reduced services to full member entities of RT."
Analysis Prepared by:
Misa Lennox / L. GOV. / (916) 319-3958 FN:
0000346
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