BILL ANALYSIS Ó SENATE COMMITTEE ON APPROPRIATIONS Senator Ricardo Lara, Chair 2015 - 2016 Regular Session AB 2796 (Bloom) - Active Transportation Program ----------------------------------------------------------------- | | | | | | ----------------------------------------------------------------- |--------------------------------+--------------------------------| | | | |Version: June 30, 2016 |Policy Vote: T. & H. 10 - 0 | | | | |--------------------------------+--------------------------------| | | | |Urgency: No |Mandate: No | | | | |--------------------------------+--------------------------------| | | | |Hearing Date: August 8, 2016 |Consultant: Mark McKenzie | | | | ----------------------------------------------------------------- This bill meets the criteria for referral to the Suspense File. Bill Summary: AB 2796 would require that a minimum of 10 percent of Active Transportation Program (ATP) funding be programmed for planning and non-infrastructure activities, as specified. The bill would also authorize a local agency to spend its own funds on a project programmed in a future year, and be reimbursed at a later time for eligible expenditures. Fiscal Impact: Cost pressures in the millions annually (State Highway Account and federal funds). By establishing a 10 percent minimum requirement in statute for planning and non-infrastructure projects, the bill would reduce the amount of funding available for ATP infrastructure projects, thereby creating pressures on an oversubscribed program. Current ATP guidelines specify that 2 percent of funds are set aside for planning. AB 2796 (Bloom) Page 1 of ? Minor and absorbable California Transportation Commission (CTC) costs to update ATP guidelines to specify the minimum planning and non-infrastructure requirement, and to prescribe the process for an agency to prefund a project. (State Highway Account) Background: The ATP was established, pursuant to SB 99 (Budget and Fiscal Review Committee), Chap. 359/2013, to consolidate several existing federal and state programs and accounts that totaled approximately $130 million in annual funding, including the state Bicycle Transportation Account, the state and federal Safe Routes to Schools (SRTS) programs, the federal Transportation Alternatives Program, and the state Environmental Enhancement and Mitigation Program. The budget agreement directed funds to be awarded by the CTC through a competitive process to urban regions (40%), small urban and rural regions (10%), and for statewide allocation (50%). The allocations for the statewide and small urban/rural components are awarded by CTC on a competitive basis, while the CTC allocates funds for the urban component in proportion to the regions' relative population, and the each region award grants on a competitive basis. Existing law requires the CTC program guidelines to include a process to ensure that at least 25 percent of overall ATP funding benefit disadvantaged communities during each program cycle. The 2017 ATP guidelines adopted by the CTC earlier this year cover fiscal years 2019-20 and 2020-21; projects will be adopted early next year. The 2017 guidelines set aside a maximum of 2% of funds in the statewide component, and in the small urban and rural component, for active transportation plans in disadvantaged communities. A large metropolitan planning organization may set aside up to 2% of its funding for active transportation plans in disadvantaged communities. Both planning and non-infrastructure projects are eligible for funding through all three program components. The CTC's 2015 fund estimate provides approximately $120 million in available resources for the ATP each year over a four-year cycle, approximately $85.5 million of which is from federal resources, with the remainder coming from the State Highway Account. The four-year fund estimate is updated and adopted AB 2796 (Bloom) Page 2 of ? every other year. Proposed Law: AB 2796 would make the following changes to the ATP: Require at least 10 percent of total funding available for distribution to be programmed for planning and non-infrastructure activities, including activities related to safe routes to school. At least 50 percent of this amount must be programmed for planning activities to develop comprehensive active transportation master plans. Authorize planning and non-infrastructure funds to be spent for other authorized expenditures if applications in any funding cycle do not exceed that minimum percentage of funding. Specify that the planning and non-infrastructure minimum funding requirements only apply to a program cycle adopted after January 1, 2018. Require CTC guidelines to establish a "letter of no prejudice" process that allows an agency to spend its own funds for a project programmed in a future year, in advance of an allocation, and to be reimbursed in a future year for eligible expenditures. Specify that non-infrastructure activities include public awareness campaigns and outreach to press and community leaders, traffic education and enforcement, sessions on bicycle and pedestrian safety, health, and environment, and funding for training, volunteers, and managers of specified program components. Staff Comments: Staff notes that the ATP is oversubscribed; over 600 applications requesting over $1 billion in funding were submitted in the most recent funding cycle, and the CTC awarded a total of $359 million for 200 projects. Approximately 5 percent of the total funding was awarded for planning and non-infrastructure activities in the last funding cycle. This bill would require, beginning in the first cycle after January 1, 2018, that a minimum of ten percent of funding be allocated for those activities, thereby creating at least $6 million in cost pressures on the program. While fewer infrastructure AB 2796 (Bloom) Page 3 of ? projects would be funded, the dedication of more funding to the development of active transportation master plans is likely to result in more competitive applications for funding in the future. Since disadvantaged communities are less likely to have plans in place, the bill may help ensure that proper planning in those communities helps to maximize targeted ATP investments. -- END --