BILL ANALYSIS Ó
AB 1780
Page 1
Date of Hearing: April 4, 2016
ASSEMBLY COMMITTEE ON TRANSPORTATION
Jim Frazier, Chair
AB 1780
(Medina) - As Amended March 28, 2016
SUBJECT: Greenhouse Gas Reduction Fund: Sustainable Trade
Corridors Program
SUMMARY: Continuously appropriates 20% of annual Greenhouse Gas
Reduction Fund (GGRF) proceeds to the Trade Corridor Improvement
Fund (TCIF) to be distributed by the California Transportation
Commission (Commission) in accordance with established TCIF
guidelines.
EXISTING LAW:
1)Requires the Air Resources Board (ARB), pursuant to AB 32
(Nunez), Chapter 488, Statutes of 2006, to develop a plan of
how to reduce statewide greenhouse gas (GHG) emissions to 1990
levels by 2020. Under AB 32, ARB is authorized to include the
use of market-based mechanisms to comply with these
regulations (cap and trade).
2)Establishes the GGRF in the State Treasury and requires all
money collected pursuant to cap and trade, with limited
exceptions, be deposited into the fund and makes the GGRF
funds available for appropriation by the Legislature.
3)Continuously appropriates 60% of GGRF fund proceeds, beginning
AB 1780
Page 2
in the 2015-16 fiscal year, for transit, affordable housing
and sustainable communities programs, and high speed rail.
4)Established the TCIF, following the passage of the Highway
Safety, Traffic Reduction, Air Quality, and Port Security Bond
Act of 2006 (Proposition 1B) on November 7, 2006, for the
distribution of $2 billion of Proposition 1B bond funds by the
Commission in accordance with established criteria for
infrastructure improvements along federally designated "Trade
Corridors of National Significance" or along other corridors
with high volumes of freight movement.
5)Continues the existence of the TCIF to receive funding from
sources other than Proposition 1B including transfers from the
GGRF for specified trade corridor infrastructure improvements.
6)Requires, pursuant to the federal Fixing America's Surface
Transportation (FAST) Act, that states desiring to obtain
freight formula funding have prepared a state freight plan,
developed in accordance with federal requirements,
7) Requires, pursuant to SB 535 (de León), Chapter 830,
Statutes of 2012, that a minimum of 25% of the moneys
available in GGRF be used to benefits disadvantaged
communities.
FISCAL EFFECT: Unknown
COMMENTS: California's goods movement system is the bedrock of
our economy, providing hundreds of thousands of jobs across the
state and the nation. California's land, air, and sea ports of
entry serve as key commercial gateways for the movement of more
than $500 billion worth of products each year. These goods flow
AB 1780
Page 3
into and out of California's gateways and are moved across our
surface transportation systems such as highways, rail systems,
and local streets and roads.
Despite the economic benefits that goods movement represents,
the industry also places a heavy burden on the state in terms of
increased demand on transportation infrastructure and increased
environmental impacts such as land development pressure, noise,
and increased criteria pollutant and GHG emissions. These
impacts are experienced across the state but are most keenly
felt in disadvantaged communities that typically border major
transportation corridors and hubs such as warehousing districts
and sea ports.
In response to the increasing need for funding to improve the
states deteriorating transportation infrastructure, voters
approved Proposition 1B in 2006 that authorized the sale of
general obligation bonds to fund transportation projects across
the state to relieve congestion, improve goods movement flow,
enhance the safety and security of the transportation system,
and improve the state's air quality. Of the $19.9 billion
approved by voters, $2 billion of bond proceeds were placed into
the then-newly created TCIF program to fund transportation
corridor improvements.
The TCIF program, administered by the Commission in accordance
with the TCIF guidelines, was designated to fund projects
identified in specified transportation infrastructure planning
documents. The TCIF guidelines ensured that funds were
equitably distributed across the state, that the highest
statewide priority projects were funded, and that the funds were
leveraged to ensure that the greatest number of projects were
completed. The Commission's role was to ensure that the state
and regions worked collaboratively to identify the highest
priority projects that provide the greatest congestion relief
benefits and that these projects were completed on schedule and
within budget. Not only did TCIF achieve the goal of getting
regions around the state to work together, it created jobs,
reduced congestion, improved the state's air quality, and helped
AB 1780
Page 4
the state achieve its emissions reduction goals. Also, by
requiring that projects receive matching funds, the TCIF
successfully leveraged the program's $2 billion in bond funds to
complete $7.2 billion in projects. To date, all of the
Proposition 1B funds have been allocated and projects using TCIF
are all nearly completed.
Recognizing the benefits that the TCIF program provided in
addressing air quality impacts and California's goods movement
system needs, the Legislature approved, and the Governor signed,
SB 1228 (Hueso), Chapter 787, Statues of 2014, to continue the
existence of TCIF and clear the way for it to receive funds
other than Proposition 1B dollars, namely GGRF funds. SB 1228
also updated the list of key freight planning documents used
guide program expenditures. The intent of SB 1228 was to allow
state and local jurisdictions to leverage cap and trade funds to
complete key freight corridor projects to reduce congestion and
address the state's air quality and climate change goals,
particularly in areas with the poorest air quality and in
disadvantaged communities.
The author points out that while SB 1228 established a basic
framework, it did not provide much needed funding. To address
this need, the author introduced AB 1780 that establishes a
dedicated funding stream for the TCIF by continuously
appropriating 20% of GGRF funds annually to the TCIF. This
appropriation would allow eligible, high priority freight
projects to be developed by state, regional, and local entities
to address California's goods movement, air quality, and climate
change goals.
In addition to state efforts directed at goods movement, recent
federal transportation bills have also highlighted the need for
freight planning and funding at the state level. For example,
in the last federal transportation reauthorization (MAP-21) the
need for comprehensive goods movement planning across the nation
was highlighted and states were encouraged to develop
comprehensive freight planning documents. More recently, in the
FAST Act, states with freight plans were made eligible to
AB 1780
Page 5
receive formula funding (approximately $150 million per year)
for freight projects identified in state freight plans.
In responding to MAP-21's call for freight planning, Caltrans
developed the California Freight Mobility Plan (CFMP), with
input from the California Freight Advisory Committee, a group
whose membership represents a broad cross section of state,
federal, local, business, and community interests in goods
movement. The CFMP identified over $138 billion in freight
projects across the state including $30 billion in Tier 1
projects alone. While the $150 million annually in federal
funding will be helpful, it will not come close to meeting the
near- or the long-term need identified in the CFMP.
Writing in support of this bill, the Automobile Club of Southern
California points out that this bill will result in much-needed
infrastructure improvements on the state's major trade corridors
and also have a positive impact on air pollution and GHG
emissions. They correctly point out that by addressing key
freight system bottlenecks, providing rail grade separations,
and implementing other important infrastructure improvements,
vehicle hours of delay will be reduced; travel time, reliability
and congestion will be improved; traffic safety will be
enhanced; and vehicle emissions will decline as trucks and
trains move more efficiently throughout the state.
Writing in opposition to this bill, the Rural County
Representatives of California (RCRC) note that, despite being
supportive of the TCIF program, they take issue with the
continuous appropriation of GGRF funds into the TCIF. They
point out that a substantial portion of GGRF monies are already
permanently allocated to other programs, leaving only a small
portion available to support programs that are vital to rural
communities. RCRC also points out that rural communities are
not always able to access GGRF for transportation projects
because they do not meet the statutorily-established definition
of disadvantaged communities despite the fact that many rural
communities meet other defining disadvantaged community criteria
recognized by the state.
AB 1780
Page 6
Related legislation: AB 2107 (Frazier), directs FAST Act
freight funding into the TCIF for allocation by the Commission.
AB 2107 is scheduled to be heard by this committee on April 4,
2016.
AB 1591 (Frazier), provides nearly $8 billion a year in
additional transportation funding, including allocation 20 % of
cap and trade revenues, through the TCIF, for projects along
major freight corridors. AB 1591 is currently awaiting a
hearing in this committee.
SBX1 1 (Beall), would, among other things, deposit approximately
$300 million from a proposed diesel tax to fund TCIF projects.
SBX1 1 is currently awaiting a hearing in the Senate
Appropriations Committee.
Previous legislation: SB 1228 (Hueso), Chapter 787, Statutes of
2014, continued the existence of the TCIF to receive funding
from sources including transfers from the GGRF for specified
trade corridor infrastructure improvements.
AB 1780
Page 7
SB 535 (de León), Chapter 830, Statutes of 2012, required, among
other things, that a minimum of 25% of the moneys available in
GGRF be used to benefits disadvantaged communities.
REGISTERED SUPPORT / OPPOSITION:
Support
Riverside County Transportation Commission (Sponsor)
Alameda Corridor-East Construction Authority
Automobile Club of Southern California
California Association of Port Authorities
California Transportation Commission
Mobility 21
Pacific Merchant Shipping Association
AB 1780
Page 8
Self-Help Counties Coalition
Opposition
California Chamber of Commerce
Rural County Representatives of California
Analysis Prepared by:Victoria Alvarez / TRANS. / (916) 319-2093