BILL ANALYSIS Ó
SENATE COMMITTEE ON APPROPRIATIONS
Senator Ricardo Lara, Chair
2015 - 2016 Regular Session
AB 2090 (Alejo) - Low Carbon Transit Operations Program
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|Version: May 27, 2016 |Policy Vote: T. & H. 9 - 0, |
| | E.Q. 4 - 0 |
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|Urgency: No |Mandate: No |
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|Hearing Date: August 1, 2016 |Consultant: Mark McKenzie |
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This bill meets the criteria for referral to the Suspense File.
Bill
Summary: AB 2090 would expand the uses for funds allocated to
transit agencies pursuant to the Low Carbon Transit Operations
Program (LCTOP) to include expenditures for the support the
operation of existing bus or rail service under specified
circumstances.
Fiscal
Impact:
Unknown, significant cost pressures on LCTOP funds to the
extent expenditures that support existing bus or rail
operations displace funding for projects that provide new or
expanded service. (Greenhouse Gas Reduction Fund - GGRF)
Likely minor administrative costs for the Department of
Transportation (Caltrans) to revise program guidelines and
review additional funding requests. (State Highway Account)
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Potential increased staff costs at the California Air
Resources Board (CARB) to determine whether projects that
support existing transit operations would result in greenhouse
gas reductions and other co-benefits, develop quantification
methods, and establish criteria. (GGRF)
Background: Existing law establishes the LCTOP to provide operating and
capital assistance for transit agencies to reduce greenhouse gas
(GHG) emissions and improve mobility, with a priority on serving
disadvantaged communities. Funds provided for the program must
be expended to provide transit operating or capital assistance
that meets all of the following criteria: (1) new or expanded
bus, rail, or water transit services, or expanded intermodal
facilities, and any other costs to operate those services or
facilities, and may include equipment acquisition, fueling, and
maintenance; (2) the recipient demonstrates that expenditures
directly enhance or expand transit service to increase mode
share; and (3) the recipient agency demonstrates that each
expenditure reduces GHG emissions. At least 50 percent of the
money allocated to transit agencies whose service area includes
disadvantaged communities must be spent on projects or services
that meet the above requirements and benefit those communities.
Caltrans is required to coordinate with CARB to develop
guidelines that recipient agencies must use to demonstrate that
expenditures meet program criteria. Before authorizing
disbursement of funds, Caltrans and CARB coordinate to determine
eligibility of recipient agencies' proposed expense types.
Existing law continuously appropriates five percent of annual
GGRF proceeds to LCTOP. Funding is allocated to transit
agencies pursuant to existing State Transit Assistance formulas
but an agency's proposed project expenditures must be reviewed
and approved by Caltrans to ensure they meet program
requirements. LCTOP received $25 million in 2014-15 and $100
million in 2015-16. The Governor's 2016-17 Budget proposed $100
million for the program in the budget year.
Existing law, the California Environmental Quality Act (CEQA),
authorizes a transit agency to declare a "fiscal emergency" if
it is projected to have negative funding within one year, and it
considers the proposed declaration at a public hearing. When a
transit agency declares a fiscal emergency caused by the failure
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of revenues to adequately fund agency programs, facilities, and
operations, existing law exempts the agency from conducting a
CEQA review of impacts related to a proposed reduction or
elimination of transit services and proposed fare, fee, fine, or
rate increases that those services.
Proposed Law:
In addition to existing authorizes LCTOP expenditures, AB 2090
would authorize transit agencies to use LCTOP funds to support
the operation of existing bus or rail service if all of the
following occur:
The transit agency's governing board declares a fiscal
emergency, as specified, within 90 days prior to requesting
funds.
Expenditure of the requested funds is necessary to sustain the
agency's transit service in the fiscal year in which funds are
proposed to be spent.
The agency's governing board would be required to reduce or
eliminate transit service if the funds are not provided.
The agency makes a finding that reduction or elimination of
transit service would result in an increase in greenhouse gas
(GHG) emissions, as specified.
The agency does not request funds over consecutive years
unless the governing board declares a fiscal emergency in each
year, and does not request funds for more than three
consecutive years.
Transit operating assistance provided pursuant to the bill must
support bus or rail service operating costs, including labor,
fueling, maintenance, and other costs. The recipient agency
must also demonstrate that each expenditure would directly
sustain service that would otherwise be reduced or eliminated if
the funds were not received.
Related
Legislation: SB 824 (Beall), which is currently pending in the
Assembly Appropriations Committee, would make various changes to
LCTOP that provide enhanced flexibility to recipient transit
agencies for program expenditures, but also require that at
least 50 percent of all LCTOP funds are used for projects that
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benefit disadvantaged communities.
Staff
Comments: Under the existing LCTOP eligibility criteria,
transit agencies must prove that a proposed expenditure will
expand specified services or facilities, directly enhance or
expand service to increase mode share, and reduce GHG emissions.
AB 2090 would instead authorize revenues to be used to sustain
existing bus or rail operations if a transit agency declares a
fiscal emergency and determines that existing service would be
reduced or eliminated without the operating subsidy. Rather
than reducing GHG emissions and expanding transit services, as
the program was originally designed, this bill would provide
funding to maintain existing operations and provide a mechanism
that avoids potential increases in GHG emissions that may result
if consumers of transit services instead chooses a less
efficient modes of transportation. By expanding the uses of
LCTOP funds, this bill would create significant cost pressures
on the program.
Under current law, CARB must develop quantification methods for
determining GHG emission reductions related to GGRF
expenditures. CARB indicates that it would be involved in
determining what justifies a fiscal emergency and likelihood of
losses of transit services, and will likely be required to
develop new quantification methods for determining that
expenditures supporting continued operations (as opposed to
investments in transit expansion) result in GHG emission
reductions. CARB estimates that it may require an additional
position, at a cost of $162,000, to perform these functions.
Staff notes that both this bill and SB 824 make changes to the
LCTOP. Both measures will need to be amended eventually to
avoid chaptering conflicts.
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