BILL ANALYSIS Ó
SB 9
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Date of Hearing: July 13, 2015
ASSEMBLY COMMITTEE ON NATURAL RESOURCES
Das Williams, Chair
SB
9 (Beall) - As Amended July 7, 2015
SENATE VOTE: 37-1
SUBJECT: Greenhouse Gas Reduction Fund: Transit and Intercity
Rail Capital Program.
SUMMARY: Modifies the Transit and Intercity Rail Capital
Program (TIRCP) to focus on capital rail and transit system
improvements that will be "transformative."
EXISTING LAW:
1) Under the California Global Warming Solutions Act of 2006,
directs the Air Resources Board (ARB) to adopt greenhouse gas
(GHG) emissions reduction measures, including market-based
mechanisms (e.g., the cap-and-trade program), to reduce GHG
emissions to 1990 levels by 2020.
2) Establishes the Greenhouse Gas Reduction Fund (GGRF) and
directs auction revenue from the cap-and-trade program to be
deposited into the fund and expended according to a
three-year investment plan developed by the Department of
Finance.
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3)Establishes the TIRCP to fund capital improvements and
operational investments that reduce GHG emissions and
modernize California's intercity, commuter, and urban rail
systems and bus systems to achieve specific policy objectives.
4)Continuously appropriates, beginning in 2015-16, 10% of annual
cap-and-trade auction revenues for the TIRCP.
5)Directs project applicants for TIRCP grants to submit grant
applications to the California State Transportation Agency
(CalSTA) for evaluation in accordance with procedures and
program guidelines adopted by the agency, and requires CalSTA
to submit a list of projects to the California Transportation
Commission (CTC) for funding.
THIS BILL:
1)Provides that the TIRCP must fund capital improvements that
are "transformative" (a term which is not defined).
2)Eliminates operations funding as an eligible use of TIRCP
funds.
3)Clarifies that bus system improvements are eligible for TIRCP
funding, and specifically provides that ferry system
improvements are also eligible.
4)Directs CalSTA to evaluate project applications consistent
with revised criteria as set forth in the bill.
5)Adds the following to the list of co-benefits CalSTA must
consider in evaluating project applications:
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a) Reduction in auto trips through growth in transit
ridership;
b) Enhanced connectivity, integration, and coordination
with various transit systems; and
6)Adds other project evaluation criteria (in addition to the
expanded list of co-benefits) to include the extent to which
the project provides the following:
a) Reduced GHG emissions;
b) Supplemental, non-state funding; and,
c) Increased transit ridership.
7)Authorizes CalSTA to make multi-year funding commitments and
requires project applications to identify the source and
timing of all funds needed to complete the project and fund
ongoing operating and maintenance costs.
8)Directs CalSTA to approve a five-year program of projects
according to prescribed procedures.
9)Establishes a process whereby an agency that is applying for
funds for a multi-year project can obtain a letter of no
prejudice from CalSTA to allow the agency to advance its own
funds and be eligible for future reimbursement from the
program.
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10)Makes other, technical modifications to the TIRCP.
FISCAL EFFECT: According to the Senate Appropriations
Committee, unknown cost pressures, at least in the millions of
dollars, to the GGRF by expanding eligibility of the TIRCP to
include ferry transit systems, and potential relief of cost
pressures to the GGRF by deleting operational expenditures from
eligibility.
COMMENTS:
According to the author, SB 9 seeks to ensure that cap-and-trade
funding is invested responsibly in projects that maximize
reductions in GHG emissions by focusing the program on
transformative projects. The author believes that
transformative transit expansion projects will result in the
"biggest bang for the buck" when it comes to reducing GHG
emissions and he believes the multi-year program provided for in
SB 9 will facilitate these projects.
The TIRCP was created via legislation enacted last year, [SB 862
(Committee on Budget and Fiscal Review), Chapter 36, Statues of
2014]. SB 862, a budget trailer bill, continuously appropriated
portions of the cap-and-trade auction revenue proceeds for
designated programs or purposes, including 10% for the TIRCP.
The TIRCP is intended to achieve the following specific policy
objectives:
1)Reduced GHG emissions;
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2)Expanded and improved rail service to increase ridership;
3)Integrated rail service of the state's various rail operators,
including integration with the high-speed rail system; and,
4)Improved rail safety.
Specific projects that are eligible for funding in the TIRCP
include:
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 rail 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; and,
4)Bus rapid transit and other bus transit investments to
increase ridership and reduce GHG emissions.
SB 862 required CalSTA to develop guidelines for the TIRCP
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before soliciting applications for funding, and these guidelines
were published in February of this year. SB 862 directed CalSTA
to evaluate project applications for funding from the TIRCP
based on the following factors:
1)Co-benefits that support implementation of sustainable
communities strategies, such as:
a) Reducing auto vehicle miles traveled;
b) Promoting housing development near rails stations;
c) Expanding existing rail and public transit stations;
d) Implementing clean vehicle technology;
e) Promoting active transportation; and,
f) Improving public health.
2)Collaboration between rail operators and state and local
agencies.
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3)Geographic equity.
4)Consistency with adopted sustainable communities strategies.
CalSTA is expected to release the first year's program of
projects within the next couple of weeks.
The Santa Clara Valley Transportation Authority (VTA) fears that
the existing TIRCP is currently not structured, either
statutorily or in the guidelines recently issued by CalSTA, in a
way that would allow the program to accommodate large transit
expansion projects. Consequently, VTA and others support SB 9
because it makes several changes to this new program by:
1)Focusing the program on transformative capital improvements;
2)Eliminating funding for operational investments;
3)Expanding the program to include ferry systems and clarifying
that bus systems are included as well;
4)Modifying project evaluation criteria to emphasize projects
that reduce GHG emissions, connect to the high-speed rail
system, and have supplemental funding from non-state sources;
and,
5)Providing for a five-year programming horizon and allowing for
multi-year project allocations.
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By enabling CalSTA to program funding over multiple fiscal
years, SB 9 allows the TIRCP to accommodate large transit
expansion projects that could receive a more substantive amount
of cap-and-trade auction revenues over a period of time rather
than all at once. Longer funding commitments will allow public
agencies to use TIRCP dollars to leverage federal funding and to
secure financing, both of which are typically done for large
transit expansion projects.
What does "transformative" mean? While a key provision of this
bill is to amend the TIRCP to require the program to fund
capital projects that are "transformative," the term is not
defined. To avoid confusion over the intent and effect of the
bill, the author and the committee may wish to consider adopting
a definition of "transformative capital improvement" to mean
rail, bus, and ferry transit projects that will significantly
reduce vehicle miles traveled and greenhouse gas emissions by
creating new transit systems or increasing the capacity of
existing transit systems in order to accommodate ridership
growth.
REGISTERED SUPPORT / OPPOSITION:
Support
Antelope Valley Transit Authority
California Transit Association
International Longshore & Warehouse Union
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Northern California Carpenters Regional Council
San Diego Metropolitan Transit System
San Francisco Bay Area Water Emergency Transportation Authority
Santa Clara County Board of Supervisors
Santa Clara Valley Transportation Authority
Silicon Valley Leadership Group
Opposition (based on prior version of the bill)
Asian Pacific Environmental Network
California Bicycle Coalition
California Walks
Catholic Charities, Diocese of Stockton
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Coalition for Clean Air
Coalition for Sustainable Transportation, Santa Barbara
L.A. County Bicycle Coalition
Leadership Counsel for Justice
Napa County Transportation Planning Agency
Natural Resources Defense Council
PolicyLink
Public Advocates
Sacramento Housing Alliance
Safe Routes to Schools National Partnership
San Diego Metropolitan Transit System
Analysis Prepared by:Lawrence Lingbloom / NAT. RES. / (916)
319-2092
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