Amended in Assembly June 23, 2015

Amended in Senate June 2, 2015

Amended in Senate May 5, 2015

Amended in Senate April 15, 2015

Amended in Senate March 24, 2015

Senate Bill No. 9

Introduced by Senator Beall

(Coauthor: Senator Allen)

December 1, 2014

An act to amend Sections 75220, 75221, and 75222 of, and to add Sections 75223, 75224, and 75225 to, the Public Resources Code, relating to transportation, and making an appropriation therefor.

LEGISLATIVE COUNSEL’S DIGEST

SB 9, as amended, Beall. Greenhouse Gas Reduction Fund: Transit and Intercity Rail Capital Program.

Existing law requires all moneys, except for fines and penalties, collected by the State Air Resources Board from the auction or sale of allowances as part of a market-based compliance mechanism relative to reduction of greenhouse gas emissions to be deposited in the Greenhouse Gas Reduction Fund.

Existing law begin delete provides various sources of funding for transportation programs, including capital and operating funds for rail services, including intercity, commuter, and urban rail systems, including end delete begin insert establishes end insert the Transit and Intercity Rail Capital begin delete Program end delete begin insert Program, end insert which receives 10% of the annual proceeds of the Greenhouse Gas Reduction Fund as a continuous begin delete appropriation. Existing law provides that the purpose of the program is end delete begin insert appropriation, end insert to fund capital improvements and operational investments to modernize California’s rail systems to achieve certain policy objectives, including reducing greenhouse gas emissions, expanding and improving rail services to increase ridership, and improving rail safety. Existing law requires the Transportation Agency to evaluate applications for funding under the program and to prepare a list of projects recommended for funding, with grants to be awarded by the California Transportation Commission.

This bill would modify the purpose of the program to delete references to operational investments and instead provide for the funding of begin delete large, end delete transformative capital improvements that will modernize California’s intercity, commuter, and urban rail systems and bus and ferry transit systems to achieve certain policy objectives, including reducing emissions of greenhouse gases, expanding and improving transit services to increase ridership, and improving transit safety. By expanding the purposes for which continuously appropriated begin delete funds end delete begin insert moneys end insert may be used, the bill would make an appropriation. The bill would begin delete require the Transportation Agency to adopt a multiyear program of projects for funding, and require the California Transportation Commission to allocate funding to applicants pursuant to the program of projects. The bill would require that 70% of available funds be programmed and allocated to projects with a total cost of $100,000,000 or more, and 30% to projects with a total cost of less than $100,000,000. end delete begin insert modify the information required to be included in applications for grants under the program and would authorize an eligible applicant to submit multiple applications. end insert The bill would require the Transportation Agency, in selecting projects for funding, to consider the extent to which a project reduces greenhouse gas emissions, would add additional factors to be considered in evaluating applications for funding, and would expand certain factors considered to include bus and ferry transit service. The bill would require the Transportation Agency to develop, by July 1, 2016, a 5-year estimate of revenues reasonably expected to be available for the program, with subsequent estimates to be made every other year for additional 5-year periods, begin delete and end delete would require the agency to adopt 5-year programs of projects consistent with those begin delete estimates. end delete begin insert estimates, and would require the California Transportation Commission to allocate funding to eligible applicants pursuant to the program of projects. end insert The bill would authorize the Transportation Agency, in cooperation with the California Transportation Commission, to make a multiyear funding commitment for a project proposed to be funded over more than one fiscal year, and would authorize the California Transportation Commission to approve a letter of no prejudice that would allow an applicant to expend its own begin delete funds end delete begin insert moneys end insert on a project in the adopted program of projects, subject to future reimbursement from program begin delete funds end delete begin insert moneys end insert for eligible expenditures.

Vote: majority. Appropriation: yes. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

Section 75220 of the Public Resources Code is
amended to read:

75220.  

(a) The Transit and Intercity Rail Capital Program is
hereby created to fund begin delete large, end delete transformative capital improvements
that will modernize California’s intercity, commuter, and urban
rail systems and bus and ferry transit systems to achieve all of the
following policy objectives:

(1) Reduce emissions of greenhouse gases.

(2) Expand and improve transit service to increase ridership.

(3) Integrate the rail service of the state’s various rail operators,
including integration with the high-speed rail system.

(4) Improve transit safety.

(b) The Transportation Agency shall evaluate applications
consistent with the criteria set forth in this chapter and adopt a
multiyear program of projects for funding pursuant to Section
75224, begin delete that end delete begin insert which end insert may be revised at any time.

(c) The California Transportation Commission shall allocate
funding to applicants pursuant to the program of projects adopted
by the Transportation Agency.

begin delete

(d) Seventy percent of available funds shall be programmed and
allocated to projects with a total cost of one hundred million dollars
($100,000,000) or more, and 30 percent shall be programmed and
allocated to projects with a total cost of less than one hundred
million dollars ($100,000,000).

end delete

SEC. 2.  

Section 75221 of the Public Resources Code is
amended to read:

75221.  

(a) Projects eligible for funding under the program
include, but are not limited to, all of the following:

(1) Rail capital projects, including acquisition of rail cars and
locomotives, that expand, enhance, and improve existing rail
systems and connectivity to existing and future transit systems,
including the high-speed rail system.

(2) Intercity and commuter rail projects that increase service
levels, improve reliability, and decrease travel times.

(3) Rail integration implementation, including integrated
ticketing and scheduling systems, shared-use corridors, related
planning efforts, and other service integration initiatives.

(4) Bus rapid transit and other bus and ferry transit investments
to increase ridership and reduce greenhouse gas emissions.

(b) In order to be eligible for funding under the program, a
project shall demonstrate that it will achieve a reduction in
emissions of greenhouse gases. In selecting projects for funding,
the Transportation Agency shall consider the extent to which a
project reduces emissions of greenhouse gases.

(c) The program shall have a programmatic goal of providing
at least 25 percent of available funding to projects benefiting
disadvantaged communities, consistent with the objectives of
Chapter 830 of the Statutes of 2012.

(d) In evaluating grant applications for funding, the
Transportation Agency shall consider all of the following:

(1) The cobenefits of projects that support begin insert the end insert implementation
of sustainable communities strategies through one or more of the
following:

(A) Reducing begin delete auto end delete vehicles miles traveled begin insert from automobiles end insert
and the number of begin delete auto end delete begin insert automobile end insert trips through growth in transit
ridership.

(B) Promoting housing development in the vicinity of rail
stations.

(C) Expanding existing rail and public transit systems.

(D) Enhancing the connectivity, integration, and coordination
of the state’s various regional and local transit systems.

(E) Providing a direct connection to the high-speed rail system.

(F) Implementing clean vehicle technology.

(G) Promoting active transportation.

(H) Improving public health.

(2) The project priorities developed through the collaboration
of two or more rail operators and any memoranda of understanding
between state agencies and local or regional rail operators.

(3) Geographic equity.

(4) Consistency with an adopted sustainable communities
strategy or, if a sustainable strategy is not required for a region by
law, a regional plan that includes policies and programs to reduce
emissions of greenhouse gases.

(5) The extent to which a project has supplemental funding
committed to it from other nonstate sources.

(6) The extent to which the project will increase transit ridership.

(e) Eligible applicants under the program shall be public
agencies, including joint powers agencies, that operate begin insert or have
planning responsibility for end insert existing or planned regularly scheduled
intercity or commuter passenger rail service, urban rail transit
service, or bus or ferry transit service.

(f) A recipient of begin delete funds end delete begin insert moneys end insert under the program may combine
funding from the program with other state funding, including, but
not limited to, the State Transportation Improvement Program, the
Low Carbon Transit Operations Program, the State Air Resources
Board clean vehicle program, and state transportation bond funds.

SEC. 3.  

Section 75222 of the Public Resources Code is
amended to read:

75222.  

(a) Applications for grants under the program shall be
submitted to the Transportation Agency for evaluation in
accordance with procedures and program guidelines adopted by
the agency. An eligible applicant may submit an application to the
agency to fund a project over multiple fiscal years. The agency
may make multiyear funding commitments for projects that are
proposed to be funded from the program over a period of more
than one fiscal year.

(b) The application shall define the project purpose, intended
scope, proposed cost, intended funding sources, and schedule for
project completion.

(c) The application shall specify the phases of work for which
an eligible applicant is seeking an allocation of begin delete funds end delete begin insert moneys end insert from
the program, as appropriate:

(1) Studies, environmental review, and permits.

(2) Preparation of project plans and specifications.

(3) Right-of-way acquisition.

(4) Construction or procurement.

(d) The application shall identify the sources and timing of all
begin delete funds end delete begin insert moneys end insert required to undertake and complete any phase of a
project for which an eligible applicant is seeking an allocation of
begin delete funds end delete begin insert moneys end insert from the program. The application shall also describe
intended sources and timing of begin delete funds end delete begin insert funding end insert to complete any
subsequent phases of the project, through construction or
procurement.

(e) The application shall include information describing the
funding sources and approach to ensuring ongoing operating and
maintenance costs of the project are funded through the useful life
of the project, as applicable.

begin insert

(f) Eligible applicants may submit more than one application
for grants under the program pursuant to this section.

end insert

SEC. 4.  

Section 75223 is added to the Public Resources Code,
to read:

75223.  

(a) The Transportation Agency shall conduct at least
two public workshops on draft program guidelines containing
selection criteria prior to adoption and shall post the draft
guidelines on the agency’s Internet Web site at least 30 days prior
to the first public workshop. Concurrent with the posting, the
agency shall transmit the draft guidelines to the fiscal committees
and the appropriate policy committees of the Legislature.

(b)  begin delete Chapter end delete begin insert The Administrative Procedure Act (Chapter end insert 3.5
(commencing with Section 11340) of Part 1 of Division 3 of Title
2 of the Government begin delete Code end delete begin insert Code) end insert does not apply to the
development and adoption of procedures and program guidelines
for the program pursuant to this section.

SEC. 5.  

Section 75224 is added to the Public Resources Code,
to read:

75224.  

(a) No later than July 1, 2016, the Transportation
Agency shall develop a five-year estimate of revenues, in annual
increments, reasonably expected to be available to the program
from the Greenhouse Gas Reduction Fund, and adopt a program
of projects, which shall cover a period of five fiscal years,
beginning with fiscal year 2016-17.

(b) The Transportation Agency shall adopt each subsequent
program of projects not later than April 1 of each even-numbered
year based on a five-year estimate of revenues, in annual
increments. Each subsequent program shall cover a period of five
fiscal years, beginning July 1 of the year of adoption, and shall be
a statement of intent by the Transportation Agency for the
allocation and expenditure of begin delete funds end delete begin insert moneys end insert during those five fiscal
years.

(c) In cooperation with the commission, the Transportation
Agency may enter into and execute a multiyear funding agreement
with an eligible applicant for a project that is proposed to be funded
from the program over a period of more than one fiscal year. The
agreement shall include a proposed schedule of the amount of
begin delete funds end delete begin insert moneys end insert expected to be provided to the eligible applicant for
each fiscal year of the agreement and may be for a period that
extends beyond the five fiscal years covered by the program of
projects.

SEC. 6.  

Section 75225 is added to the Public Resources Code,
to read:

75225.  

(a) A lead applicant agency may apply to the
commission for a letter of no prejudice for a project or for any
component of a project included in the five-year program of
projects adopted by the Transportation Agency. If approved by
the commission, the letter of no prejudice shall allow the lead
applicant agency to expend its own begin delete funds end delete begin insert moneys end insert for the project
or any component of the project and to be eligible for future
reimbursement from begin delete funds end delete begin insert moneys end insert available for the program from
the Greenhouse Gas Reduction Fund.

(b) The amount expended under subdivision (a) shall be
reimbursed by the state from begin delete funds end delete begin insert moneys end insert available for the
program from the Greenhouse Gas Reduction Fund if all of the
following conditions are met:

(1) The project or project component for which the letter of no
prejudice was requested has commenced, and the regional or local
expenditures have been incurred.

(2) The expenditures made by the lead applicant agency are
eligible for reimbursement in accordance with applicable laws and
procedures. If expenditures made by the lead applicant agency are
determined to be ineligible, the state has no obligation to reimburse
those expenditures.

(3) The lead applicant agency complies with all legal
requirements for the project, including the requirements of the
California Environmental Quality Act (Division 13 (commencing
with Section 21000)).

(4) There are begin delete funds end delete begin insert moneys end insert in the Greenhouse Gas Reduction
Fund designated for the program that are sufficient to make the
reimbursement payment.

(c) The lead applicant agency and the commission shall enter
into an agreement governing reimbursement as described in this
section. The timing and final amount of reimbursement is
dependent on the terms of the agreement and the availability of
begin delete funds end delete begin insert moneys end insert in the Greenhouse Gas Reduction Fund for the
program.

(d) The commission, in consultation with intercity, commuter,
urban rail, and other public transit entities, may develop guidelines
to implement this section.