BILL ANALYSIS Ó
SENATE COMMITTEE ON ENVIRONMENTAL QUALITY
Senator Wieckowski, Chair
2015 - 2016 Regular
Bill No: AB 2090
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|Author: |Alejo |
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|Version: |5/27/2016 |Hearing |6/29/2016 |
| | |Date: | |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant:|Rebecca Newhouse |
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SUBJECT: Low Carbon Transit Operations Program.
ANALYSIS:
Existing law:
1) Under the California Global Warming Solutions Act of 2006
(also known as AB 32), requires the California Air Resources
Board (ARB) to determine the 1990 statewide greenhouse gas
(GHG) emissions level and approve a statewide GHG emissions
limit that is equivalent to that level, to be achieved by
2020, and to adopt GHG emissions reductions measures by
regulation. ARB is authorized to include the use of
market-based mechanisms to comply with these regulations.
(Health and Safety Code §38500 et seq.)
2) Establishes the Greenhouse Gas Reduction Fund (GGRF) in the
State Treasury, requires all moneys, except for fines and
penalties, collected pursuant to a market-based mechanism be
deposited in the fund. (Government Code §16428.8)
3) Prohibits the state from approving allocations for a measure
or program using GGRF moneys except after determining that
the use of those moneys furthers the regulatory purposes of
AB 32, and requires moneys from the GGRF be used to
facilitate the achievement of reductions of GHG emissions in
California. (HSC §39712)
4) Establishes Low Carbon Transit Operations Program (LCTOP),
administered by the California Department of Transportation
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(Caltrans), and continuously appropriates 5% of GGRF fund
proceeds for transit operations to expand service and reduce
emissions of GHGs, with a priority on serving disadvantaged
communities.
This bill:
1)Allows funds from LCTOP to be expended to support the
operation of existing bus or rail service if the following
criteria are met:
a) The governing board of the transit agency declares a
fiscal emergency, as defined by the California
Environmental Quality Act (CEQA), within 90 days of the
agency requesting LCTOP funds.
b) The expenditure of the LCTOP funds is necessary to
sustain the transit agency's transit service in the year in
which the funds would be expended.
c) The governing board of the transit agency would be
forced to reduce or eliminate transit service if the
requested LCTOP funds are not received.
d) The governing board of the transit agency makes a
finding that a reduction in or elimination of existing
transit service would increase GHG emissions because
customers would choose other less-efficient modes of
transportation.
2)Defines the criteria for which funds from LCTOP can be
expended by the transit agency after it declares a fiscal
emergency under CEQA, as specified.
Background
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1) Cap-and-trade auction revenue. Since November 2012, ARB has
conducted 15 cap-and-trade auctions, generating over $4
billion in proceeds to the state.
State law specifies that the auction revenues must be used to
facilitate the achievement of GHG emissions reductions and
outlines various categories of allowable expenditures.
Budget allocations. SB 862 (Committee on Budget and Fiscal
Review, Chapter 36, Statutes of 2014), a budget trailer bill,
established a long-term cap-and-trade expenditure plan by
continuously appropriating portions of the funds for
designated programs or purposes. The legislation
appropriates 25% for the state's high-speed rail project, 20%
for affordable housing and sustainable communities grants,
10% to the Transit and Intercity Rail Capital Program, and 5%
for the Low-Carbon Transit Operations Program (LCTOP). The
remaining 40% is available for annual appropriation by the
Legislature.
The Governor's 2016-17 proposed budget appropriates over $3
billion to a variety of programs and projects in the
transportation, energy, natural resources, and waste
diversion sectors.
2) Low Carbon Transit Operations Program. LCTOP was established
to provide operating and capital assistance for transit
agencies to reduce GHG emissions and improve mobility, with a
priority on serving disadvantaged communities. LCTOP is
administered by Caltrans and is continuously appropriated 5%
of GGRF funds. In 2014-15, LCTOP received $25 million, and
in 2015-16 it was funded at $100 million. LCTOP expenditures
are required to support new or expanded transit service,
directly enhance or expand transit service to increase mode
share, and reduce GHG emissions.
Prior to receiving an allocation, which is distributed by the
State Controller through the State Transit Assistance formula,
eligible transit agencies must submit a description of their
proposed expenditures and demonstrate how each expenditure
will reduce GHG emissions. Approved projects in LCTOP may
include equipment acquisition, fueling, maintenance, and other
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costs to operate new or expanded services and/or facilities.
For transit agencies whose service area includes disadvantaged
communities, at least 50% of the total moneys received are
required to be expended on projects that will benefit
disadvantaged communities.
Comments
1) Purpose of Bill. According to the author, "This bill would
provide transit agencies with an additional tool for
maintaining current transit service levels during fiscal
emergencies, with the acknowledgement that severe funding
challenges hurt transit ridership and jeopardize the state's
long-term greenhouse gas emission reduction goals. An
important part of meeting the state's greenhouse emission
reduction goals is not only to expand existing transit
services, but also to maintain existing services to prevent
people from having to take on less environmentally safe modes
of transportation."
2) Counter to goals of LCTOP program. LCTOP is funded through a
5% continuous appropriation of GGRF. Projects funded through
GGRF are required to demonstrate GHG emissions reductions.
Because of the statutory and legal requirements with regard
to use of GGRF, LCTOP was designed to require new or expanded
service to increase ridership in order to provide additional
GHG emissions reductions above and beyond base levels of
service. The requirements of the program are intended to
prevent GGRF moneys be used to subsidize current levels of
service, or backfill operating budgets.
Because of budget deficits, proponents wish to use LCTOP
funds to maintain current levels of transit service. Does
that objective run counter to the original policy goals of
LCTOP and the statutory mandates for the use of GGRF,
intended to fund projects that result in new, additional GHG
emissions reductions?
3) After three years time. Under the bill, a governing board may
use LCTOP moneys to maintain current levels of service for
three years, provided they declare a fiscal emergency each of
those years. In a situation where a transit agency has no
choice but to declare a fiscal emergency and use LCTOP to
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subsidize current operations, the funds are being used not to
increase sustainability or decrease the structural deficit,
but simply to barely maintain the status quo. Will the moneys
simply delay the inevitable? How will a three year operating
subsidy fix a transit agency's structural funding problems?
4) Fiscal emergency. Under AB 2090, transit agencies may use
LCTOP moneys to support the operation of existing bus or rail
service if the governing board of the transit agency declares
a fiscal emergency, and finds that LCTOP funds are necessary
to sustain the transit agency's level of service.
However, once LCTOP funds are available when a fiscal
emergency is declared, will transit agencies, frequently
strapped for funds, be more likely to declare fiscal
emergencies instead of implementing alternative options, such
as fare increases, changes in transit service, renegotiations
of agreements with universities and cities, and other
measures that may improve fiscal sustainability down the
road?
DOUBLE REFERRAL:
This measure was heard in the Senate Transportation and Housing
Committee on June 21, 2016, and passed out of committee with a
vote of 9-0.
Related/Prior Legislation
SB 824 (Beall) makes various changes related to LCTOP, including
requiring expenditures under the LCTOP to fund new or expanded
service, increase mode share, or purchase zero-emission buses.
SB 824 is set for hearing in the Assembly Transportation
Committee on June 27, 2016.
SOURCE: Santa Cruz Metropolitan Transit District
SUPPORT:
Association of Monterey Bay Area Governments
California Transit Association
City of Santa Cruz
Monterey-Salinas Transit
Orange County Transportation Authority
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Riverside Transit Agency
Santa Cruz County Regional Transportation Commission
Transportation Agency for Monterey County
Ventura County Transportation Commission
OPPOSITION:
None received
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