Amended in Assembly August 17, 2015

Amended in Assembly July 16, 2015

Amended in Assembly July 7, 2015

Amended in Assembly July 2, 2015

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 begin delete the auction or sale of allowances as part of end delete a market-based compliance mechanism relative to reduction of greenhouse gas emissions to be deposited in the Greenhouse Gas Reduction Fund.

Existing law establishes the Transit and Intercity Rail Capital Program, which receives 10% of the annual proceeds of the Greenhouse Gas Reduction Fund as a continuous appropriation, 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 transformative capital improvements, as defined, 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 moneys may be used, the bill would make an appropriation. The bill would modify the information required to be included in applications for grants under the program and would authorize an eligible applicant to submit begin insert an application to fund a project over multiple fiscal years and to submit end insert multiple applications. 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 approve, by July 1, begin delete 2016 end delete begin insert 2018 end insert , a 5-year program of projects, and would require the California Transportation Commission to allocate funding to eligible applicants pursuant to the program of projects, with subsequent programs of projects to be approved not later than April 1 of each even-numbered year thereafter. The bill would begin delete authorize end delete begin insert require end insert the Transportation Agency, in cooperation with the California Transportation begin delete Commissiom end delete begin insert Commission end insert and at the request of an eligible applicant, to begin delete make end delete begin insert enter into and execute end insert a multiyear funding commitment for a project to be funded over more than one fiscal year, begin insert as specified, end insert and would authorize the California Transportation Commission to approve a letter of no prejudice that would allow an applicant to expend its own moneys on a project in the approved program of projects, subject to future reimbursement from program moneys 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 transformative capital improvements, as
defined in subdivision (d), 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 begin delete chapter end delete begin insert part end insert and approve
a multiyear program of projects for funding pursuant to Section
75224, which may be revised at any time.

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

(d) “Transformative capital improvement” means a rail, bus, or
ferry transit project that will significantly reduce vehicle miles
traveled, congestion, and greenhouse gas emissions by creating a
new transit system begin delete or end delete begin insert , end insert increasing the capacity of an existing transit
begin delete system in order to accommodate ridership growth. end delete begin insert system, or
otherwise significantly increasing the ridership of a transit system. end insert

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, begin delete and end delete begin insert or end insert decrease travel begin delete times. end delete begin insert times,
including infrastructure access payments to host railroads in lieu
of capital investments. end insert

(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.

begin insert

(5) Transit effectiveness studies that will result in implemented
service improvements that increase ridership.

end insert

(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 the implementation
of sustainable communities strategies through one or more of the
following:

(A) Reducing vehicles miles traveled from automobiles and the
number of automobile 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 transit systems, including, but not limited to,
regional and local transit systems and the high-speed rail system.

(E) Implementing clean vehicle technology.

(F) Promoting active transportation.

(G) 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 or have
planning responsibility for 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 moneys 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 approved 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 by an eligible applicant 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 moneys from the
program.

(d) The application shall identify the sources and timing of all
moneys required to undertake and complete any phase of a project
for which an eligible applicant is seeking an allocation of moneys
from the program. The application shall also describe intended
sources and timing of funding 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.

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

(g) An eligible applicant may use a project study report or
equivalent document to demonstrate eligibility of a project for
inclusion in the five-year program of projects pursuant to Section
75224. The project study report or equivalent document shall, at
a minimum, be adequate to define and justify the project scope,
cost, and schedule for the project application.

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 approval 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) The Administrative Procedure Act (Chapter 3.5
(commencing with Section 11340) of Part 1 of Division 3 of Title
2 of the Government Code) does not apply to the development and
approval 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, begin delete 2016, end delete begin insert 2018, end insert the Transportation
Agency shall approve a program of projects, which shall cover a
period of five fiscal years, beginning with the begin delete 2016-17 end delete begin insert 2018-19 end insert
fiscal year.

(b) The Transportation Agency shall approve each subsequent
program of projects not later than April 1 of each even-numbered
year, in annual increments. Each subsequent program shall cover
a period of five fiscal years, beginning July 1 of the year of
approval, and shall be a statement of intent by the Transportation
Agency for the allocation and expenditure of moneys during those
five fiscal years.

(c) In developing the program of projects, begin insert and consistent with
the consideration of all other criteria for individual projects, end insert the
Transportation Agency shall seek to maximize the total amount
of reductions in emissions of greenhouse gases that would be
achieved under the program.

begin delete

(d) At the request of an eligible applicant, the Transportation
Agency, in cooperation with the commission, may enter into and
execute a multiyear funding agreement with the applicant for a
project to be funded from the program over a period of more than
one fiscal year.

end delete begin insert

(d) For a project to be funded from the program over a period
of more than one fiscal year, the Transportation Agency, at the
request of an eligible applicant and in cooperation with the
commission, shall enter into and execute a multiyear funding
agreement with the eligible applicant for the project for an amount
of program moneys and for a duration determined jointly by the
agency and applicant.

end insert

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

(b) The amount expended under subdivision (a) shall be
reimbursed by the state from moneys 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 moneys 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
moneys 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.