Amended in Senate August 24, 2016

Amended in Senate April 21, 2016

Amended in Senate September 1, 2015

Amended in Senate August 25, 2015

Amended in Senate July 14, 2015

California Legislature—2015–16 First Extraordinary Session

Senate BillNo. 1


Introduced by Senator Beall

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(Principal coauthor: Assembly Member Frazier)

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(Coauthors: Senators Allen, Hall, Hertzberg, McGuire, and Mendoza)

June 22, 2015


begin deleteAn act to amend Sections 13975, 14500, 14526.5, and 16965 of, to add Sections 14007.3, 14033, 14526.7, 14526.8, 14526.9, 16321, and 16965.2 to, to add Part 5.1 (commencing with Section 14460) to Division 3 of Title 2 of, and to repeal Section 14534.1 of, the Government Code, to amend Section 39719 of the Health and Safety Code, to amend Section 21080.37 of, and to add Division 13.6 (commencing with Section 21200) to, the Public Resources Code, to amend Section 99312.1 of the Public Utilities Code, to amend Sections 6051.8, 6201.8, 7360, 8352.4, 8352.5, 8352.6, and 60050 of the Revenue and Taxation Code, to amend Sections 143, 183.1, and 820.1 of, to add Sections 2103.1 and 2103.2 to, to add Article 8 (commencing with Section 228) to Chapter 1 of Division 1 of, and to add Chapter 2 (commencing with Section 2030) to Division 3 of, the Streets and Highways Code, and to add Sections 9250.3, 9250.6, 9400.5, and 9400.6 to the Vehicle Code, relating to transportation, making an appropriation therefor, and declaring the urgency thereof, to take effect immediately. end delete begin insertAn act to amend Sections 13975, 14500, 14526.5, and 16965 of, to add Sections 14033, 14526.7, and 16321 to, to add Part 5.1 (commencing with Section 14460) to Division 3 of Title 2 of, and to repeal Section 14534.1 of, the Government Code, to amend Section 39719 of the Health and Safety Code, to amend Section 21080.37 of, and to add Division 13.6 (commencing with Section 21200) to, the Public Resources Code, to amend Section 99312.1 of the Public Utilities Code, to amend Sections 6051.8, 6201.8, 7360, 8352.4, 8352.5, 8352.6, and 60050 of the Revenue and Taxation Code, to amend Sections 183.1, 820.1, 2192, 2192.1, and 2192.2 of, to add Sections 2103.1 and 2192.4 to, and to add Chapter 2 (commencing with Section 2030) to Division 3 of, the Streets and Highways Code, and to add Sections 9250.3, 9250.6, and 9400.5 to the Vehicle Code, relating to transportation, making an appropriation therefor, and declaring the urgency thereof, to take effect immediately.end insert

LEGISLATIVE COUNSEL’S DIGEST

SB 1, as amended, Beall. begin deleteTransportation funding: environmental mitigation: oversight. end deletebegin insertTransportation funding.end insert

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(1) Existing law provides various sources of funding for transportation purposes, including funding for the state highway system and the local street and road system. These funding sources include, among others, fuel excise taxes, commercial vehicle weight fees, local transactions and use taxes, and federal funds. Existing law imposes certain registration fees on vehicles, with revenues from these fees deposited in the Motor Vehicle Account and used to fund the Department of Motor Vehicles and the Department of the California Highway Patrol. Existing law provides for the monthly transfer of excess balances in the Motor Vehicle Account to the State Highway Account.

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This bill would create the Road Maintenance and Rehabilitation Program to address deferred maintenance on the state highway system and the local street and road system. The bill would require the California Transportation Commission to adopt performance criteria, consistent with a specified asset management plan, to ensure efficient use of certain funds available for the program. The bill would provide for the deposit of various funds for the program in the Road Maintenance and Rehabilitation Account, which the bill would create in the State Transportation Fund, including revenues attributable to a $0.17 per gallon increase in the motor vehicle fuel (gasoline) tax imposed by the bill with an inflation adjustment, as provided, an increase of $38 in the annual vehicle registration fee with an inflation adjustment, as provided, a new $165 annual vehicle registration fee with an inflation adjustment, as provided, applicable to zero-emission motor vehicles, as defined, and certain miscellaneous revenues described in (7) below that are not restricted as to expenditure by Article XIX of the California Constitution.

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This bill would annually set aside $200,000,000 of the funds available for the program to fund road maintenance and rehabilitation purposes in counties that have sought and received voter approval of taxes or that have imposed fees, including uniform developer fees, as defined, which taxes or fees are dedicated solely to transportation improvements. These funds would be continuously appropriated for allocation pursuant to guidelines to be developed by the California Transportation Commission in consultation with local agencies. The bill would require $80,000,000 of the funds available for the program to be annually transferred to the State Highway Account for expenditure on the Active Transportation Program. The bill would require $30,000,000 of the funds available for the program in each of 4 fiscal years beginning in 2017-18 to be transferred to the Advance Mitigation Fund created by the bill pursuant to (12) below. The bill would continuously appropriate $2,000,000 annually of the funds available for the program to the California State University for the purpose of conducting transportation research and transportation-related workforce education, training, and development. The bill would require the remaining funds available for the program to be allocated 50% for maintenance of the state highway system or to the state highway operation and protection program and 50% to cities and counties pursuant to a specified formula. The bill would impose various requirements on the department and agencies receiving these funds. The bill would authorize a city or county to spend its apportionment of funds under the program on transportation priorities other than those allowable pursuant to the program if the city’s or county’s average Pavement Condition Index meets or exceeds 80.

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The bill would also require the department to annually identify savings achieved through efficiencies implemented at the department and to propose, from the identified savings, an appropriation to be included in the annual Budget Act of up to $70,000,000 from the State Highway Account for expenditure on the Active Transportation Program.

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(2) Existing law establishes in state government the Transportation Agency, which includes various departments and state entities, including the California Transportation Commission. Existing law vests the California Transportation Commission with specified powers, duties, and functions relative to transportation matters. Existing law requires the commission to retain independent authority to perform the duties and functions prescribed to it under any provision of law.

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This bill would exclude the California Transportation Commission from the Transportation Agency, establish it as an entity in state government, and require it to act in an independent oversight role. The bill would also make conforming changes.

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(3) Existing law creates various state agencies, including the Department of Transportation, the High-Speed Rail Authority, the Department of the California Highway Patrol, the Department of Motor Vehicles, and the State Air Resources Board, with specified powers and duties. Existing law provides for the allocation of state transportation funds to various transportation purposes.

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This bill would create the Office of the Transportation Inspector General in state government, as an independent office that would not be a subdivision of any other government entity, to ensure that all of the above-referenced state agencies and all other state agencies expending state transportation funds are operating efficiently, effectively, and in compliance with federal and state laws. The bill would provide for the Governor to appoint the Transportation Inspector General for a 6-year term, subject to confirmation by the Senate, and would provide that the Transportation Inspector General may not be removed from office during the term except for good cause. The bill would specify the duties and responsibilities of the Transportation Inspector General and would require an annual report to the Legislature and Governor.

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This bill would require the department to update the Highway Design Manual to incorporate the “complete streets” design concept by January 1, 2017.

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(4) Existing law provides for loans of revenues from various transportation funds and accounts to the General Fund, with various repayment dates specified.

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This bill would require the Department of Finance, on or before September 1, 2016, to compute the amount of outstanding loans made from specified transportation funds. The bill would require the Department of Transportation to prepare a loan repayment schedule and would require the outstanding loans to be repaid pursuant to that schedule, as prescribed. The bill would appropriate funds for that purpose from the Budget Stabilization Account. The bill would require the repaid funds to be transferred, pursuant to a specified formula, to cities and counties and to the department for maintenance of the state highway system and for purposes of the state highway operation and protection program.

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(5) The Highway Safety, Traffic Reduction, Air Quality, and Port Security Bond Act of 2006 (Proposition 1B) created the Trade Corridors Improvement Fund and provided for allocation by the California Transportation Commission of $2 billion in bond funds for infrastructure improvements on highway and rail corridors that have a high volume of freight movement and for specified categories of projects eligible to receive these funds. Existing law continues the Trade Corridors Improvement Fund in existence in order to receive revenues from sources other than the bond act for these purposes.

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This bill would deposit the revenues attributable to a $0.30 per gallon increase in the diesel fuel excise tax imposed by the bill into the Trade Corridors Improvement Fund. The bill would require revenues apportioned to the state from the national highway freight program established by the federal Fixing America’s Surface Transportation Act to be allocated for trade corridor improvement projects approved pursuant to these provisions.

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Existing law requires the commission, in determining projects eligible for funding, to consult various state freight and regional infrastructure and goods movement plans and the statewide port master plan.

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This bill would delete consideration of the State Air Resources Board’s Sustainable Freight Strategy and the statewide port master plan and would instead include consideration of the applicable port master plan when determining eligible projects for funding. The bill would also expand eligible projects to include rail landside access improvements, landside freight access improvements to airports, and certain capital and operational improvements.

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(6) 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 continuously appropriates 10% of the annual proceeds of the fund to the Transit and Intercity Rail Capital Program and 5% of the annual proceeds of the fund to the Low Carbon Transit Operations Program.

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This bill would, beginning in the 2016-17 fiscal year, instead continuously appropriate 20% of those annual proceeds to the Transit and Intercity Rail Capital Program and 10% of those annual proceeds to the Low Carbon Transit Operations Program, thereby making an appropriation.

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(7) Article XIX of the California Constitution restricts the expenditure of revenues from taxes imposed by the state on fuels used in motor vehicles upon public streets and highways to street and highway and certain mass transit purposes. Existing law requires certain miscellaneous revenues deposited in the State Highway Account that are not restricted as to expenditure by Article XIX of the California Constitution to be transferred to the Transportation Debt Service Fund in the State Transportation Fund, as specified, and requires the Controller to transfer from the fund to the General Fund an amount of those revenues necessary to offset the current year debt service made from the General Fund on general obligation transportation bonds issued pursuant to Proposition 116 of 1990.

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This bill would delete the transfer of these miscellaneous revenues to the Transportation Debt Service Fund, thereby eliminating the offsetting transfer to the General Fund for debt service on general obligation transportation bonds issued pursuant to Proposition 116 of 1990. The bill, subject to a specified exception, would instead require the miscellaneous revenues to be retained in the State Highway Account and to be deposited in the Road Maintenance and Rehabilitation Account.

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(8) Article XIX of the California Constitution requires gasoline excise tax revenues from motor vehicles traveling upon public streets and highways to be deposited in the Highway Users Tax Account, for allocation to city, county, and state transportation purposes. Existing law generally provides for statutory allocation of gasoline excise tax revenues attributable to other modes of transportation, including aviation, boats, agricultural vehicles, and off-highway vehicles, to particular accounts and funds for expenditure on purposes associated with those other modes, except that a specified portion of these gasoline excise tax revenues is deposited in the General Fund. Expenditure of the gasoline excise tax revenues attributable to those other modes is not restricted by Article XIX of the California Constitution.

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This bill, commencing July 1, 2016, would instead transfer to the Highway Users Tax Account for allocation to state and local transportation purposes under a specified formula the portion of gasoline excise tax revenues currently being deposited in the General Fund that are attributable to boats, agricultural vehicles, and off-highway vehicles. Because that account is continuously appropriated, the bill would make an appropriation.

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(9) Existing law, as of July 1, 2011, increases the sales and use tax on diesel and decreases the excise tax, as provided. Existing law requires the State Board of Equalization to annually modify both the gasoline and diesel excise tax rates on a going-forward basis so that the various changes in the taxes imposed on gasoline and diesel are revenue neutral.

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This bill would eliminate the annual rate adjustment to maintain revenue neutrality for the gasoline and diesel excise tax rates and would reimpose the higher gasoline excise tax rate that was in effect on July 1, 2010, in addition to the increase in the rate described in paragraph (1).

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Existing law, beyond the sales and use tax rate generally applicable, imposes an additional sales and use tax on diesel fuel at the rate of 1.75%, subject to certain exemptions, and provides for the net revenues collected from the additional tax to be transferred to the Public Transportation Account. Existing law continuously appropriates these revenues to the Controller for allocation by formula to transportation agencies for public transit purposes.

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This bill would increase the additional sales and use tax on diesel fuel by an additional 3.5%. By increasing the revenues deposited in a continuously appropriated fund, the bill would thereby make an appropriation. The bill would restrict expenditures of revenues from this increase in the sales and use tax on diesel fuel to transit capital purposes and certain transit services and would require a recipient transit agency to comply with certain requirements, including submitting a list of proposed projects to the Department of Transportation, as a condition of receiving a portion of these funds. The bill would require an existing required audit of transit operator finances to verify that these new revenues have been expended in conformance with these specific restrictions and all other generally applicable requirements.

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This bill would, beginning July 1, 2019, and every 3rd year thereafter, require the State Board of Equalization to recompute the gasoline and diesel excise tax rates and the additional sales and use tax rate on diesel fuel based upon the percentage change in the California Consumer Price Index transmitted to the board by the Department of Finance, as prescribed.

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(10) Existing law requires the Department of Transportation to prepare a state highway operation and protection program every other year for the expenditure of transportation capital improvement funds for projects that are necessary to preserve and protect the state highway system, excluding projects that add new traffic lanes. The program is required to be based on an asset management plan, as specified. Existing law requires the department to specify, for each project in the program the capital and support budget and projected delivery date for various components of the project. Existing law provides for the California Transportation Commission to review and adopt the program, and authorizes the commission to decline and adopt the program if it determines that the program is not sufficiently consistent with the asset management plan.

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This bill would add to the program capital projects relative to the operation of those state highways and bridges. The bill would require the commission, as part of its review of the program, to hold at least one hearing in northern California and one hearing in southern California regarding the proposed program. The bill would require the department to submit any change to a programmed project as an amendment to the commission for its approval.

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This bill, on and after February 1, 2017, would also require the commission to make an allocation of all capital and support costs for each project in the program, and would require the department to submit a supplemental project allocation request to the commission for each project that experiences cost increases above the amounts in its allocation. The bill would require the commission to establish guidelines to provide exceptions to the requirement for a supplemental project allocation requirement that the commission determines are necessary to ensure that projects are not unnecessarily delayed.

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(11) Existing law imposes weight fees on the registration of commercial motor vehicles and provides for the deposit of net weight fee revenues into the State Highway Account. Existing law provides for the transfer of certain weight fee revenues from the State Highway Account to the Transportation Debt Service Fund to reimburse the General Fund for payment of debt service on general obligation bonds issued for transportation purposes. Existing law also provides for the transfer of certain weight fee revenues to the Transportation Bond Direct Payment Account for direct payment of debt service on designated bonds, which are defined to be certain transportation general obligation bonds issued pursuant to Proposition 1B of 2006. Existing law also provides for loans of weight fee revenues to the General Fund to the extent the revenues are not needed for bond debt service purposes, with the loans to be repaid when the revenues are later needed for those purposes, as specified.

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This bill, notwithstanding these provisions or any other law, would only authorize specified percentages of weight fee revenues to be transferred from the State Highway Account to the Transportation Debt Service Fund, the Transportation Bond Direct Payment Account, or any other fund or account for the purpose of payment of the debt service on transportation general obligation bonds in accordance with a prescribed schedule and would prohibit the transfer of weight fee revenues from the State Highway Account after the 2020-21 fiscal year. The bill would also prohibit loans of weight fee revenues to the General Fund.

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(12) The California Environmental Quality Act (CEQA) requires a lead agency, as defined, to prepare, or cause to be prepared, and certify the completion of, an environmental impact report on a project that it proposes to carry out or approve that may have a significant effect on the environment or to adopt a negative declaration if it finds that the project will not have that effect. CEQA also requires a lead agency to prepare a mitigated negative declaration for a project that may have a significant effect on the environment if revisions in the project would avoid or mitigate that effect and there is no substantial evidence that the project, as revised, would have a significant effect on the environment.

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CEQA, until January 1, 2020, exempts a project or an activity to repair, maintain, or make minor alterations to an existing roadway, as defined, other than a state roadway, if the project or activity is carried out by a city or county with a population of less than 100,000 persons to improve public safety and meets other specified requirements.

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This bill would extend the above-referenced exemption indefinitely and delete the limitation of the exemption to projects or activities in cities and counties with a population of less than 100,000 persons. The bill would also expand the exemption to include state roadways.

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This bill would also establish the Advance Mitigation Program in the Department of Transportation. The bill would authorize the department to undertake mitigation measures in advance of construction of a planned transportation project. The bill would require the department to establish a steering committee to advise the department on advance mitigation measures and related matters. The bill would create the Advance Mitigation Fund as a continuously appropriated revolving fund, to be funded initially from the Road Maintenance and Rehabilitation Program pursuant to (1) above. The bill would provide for reimbursement of the revolving fund at the time a planned transportation project benefiting from advance mitigation is constructed.

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(13) Existing federal law requires the United States Secretary of Transportation to carry out a surface transportation project delivery program, under which the participating states assume certain responsibilities for environmental review and clearance of transportation projects that would otherwise be the responsibility of the federal government. Existing law, until January 1, 2017, provides that the State of California consents to the jurisdiction of the federal courts with regard to the compliance, discharge, or enforcement of the responsibilities the Department of Transportation assumed as a participant in this program.

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This bill would delete the January 1, 2017, repeal date, thereby extending these provisions indefinitely.

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(14) This bill would declare that it is to take effect immediately as an urgency statute.

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(1) Existing law provides various sources of funding for transportation purposes, including funding for the state highway system and the local street and road system. These funding sources include, among others, fuel excise taxes, commercial vehicle weight fees, local transactions and use taxes, and federal funds. Existing law imposes certain registration fees on vehicles, with revenues from these fees deposited in the Motor Vehicle Account and used to fund the Department of Motor Vehicles and the Department of the California Highway Patrol. Existing law provides for the monthly transfer of excess balances in the Motor Vehicle Account to the State Highway Account.

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This bill would create the Road Maintenance and Rehabilitation Program to address deferred maintenance on the state highway system and the local street and road system and for other specified purposes. The bill would provide for the deposit of various funds for the program in the Road Maintenance and Rehabilitation Account, which the bill would create in the State Transportation Fund, including revenues attributable to a $0.12 per gallon increase in the motor vehicle fuel (gasoline) tax imposed by the bill and $0.10 of a $0.22 per gallon increase in the diesel fuel excise tax imposed by the bill, an increase of $35 in the annual vehicle registration fee, a new $100 annual vehicle registration fee applicable to zero-emission motor vehicles, as defined, a new annual road access charge on each vehicle, as defined, of $35, and repayment, by June 30, 2016, of outstanding loans made in previous years from certain transportation funds to the General Fund. The bill would provide that revenues from future adjustments in the applicable portion of the fuel tax rates, the annual vehicle registration fee increase, and the road access charge would also be deposited in the account.

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The bill would continuously appropriate the funds in the account for road maintenance and rehabilitation purposes and would allocate 5% of available funds to counties that approve a transactions and use tax on or after July 1, 2016, with the remaining funds to be allocated 50% for maintenance of the state highway system or to the state highway operation and protection program, and 50% to cities and counties pursuant to a specified formula. The bill would impose various requirements on agencies receiving these funds and would require the California Transportation Commission to adopt performance criteria related to highway performance goals, greenhouse gas emissions, social equity impacts, and public health impacts, as specified. The bill would require the commission to annually evaluate the department and each city and county receiving these revenues to determine effectiveness in reducing deferred maintenance and improving roadway conditions, as well as in meeting the performance criteria. The bill would authorize the commission to withhold future allocations of funds or to reapportion funds to other agencies under certain conditions. The bill would authorize a city or county to spend its apportionment of funds under the program on transportation priorities other than those allowable pursuant to the program if the city’s or county’s average Pavement Condition Index meets or exceeds 85.

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(2) The Highway Safety, Traffic Reduction, Air Quality, and Port Security Bond Act of 2006 (Proposition 1B) created the Trade Corridors Improvement Fund and provided for allocation by the California Transportation Commission of $2 billion in bond funds for infrastructure improvements on highway and rail corridors that have a high volume of freight movement, and specified categories of projects eligible to receive these funds. Existing law continues the Trade Corridors Improvement Fund in existence in order to receive revenues from sources other than the bond act for these purposes.

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The bill would transfer revenues attributable to $0.12 of the $0.22 increase in the diesel fuel excise tax and future adjustments to the Trade Corridors Improvement Fund for expenditure on eligible projects.

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(3) Existing law, as of July 1, 2011, increases the sales and use tax on diesel and decreases the excise tax, as provided. Existing law requires the State Board of Equalization to annually modify both the gasoline and diesel excise tax rates on a going-forward basis so that the various changes in the taxes imposed on gasoline and diesel are revenue neutral.

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This bill would eliminate the annual rate adjustment to maintain revenue neutrality for the gasoline and diesel excise tax rates, and would reimpose the gasoline excise tax rate that was in effect on July 1, 2010, in addition to the increase in the rate described in (1). This bill would, beginning July 1, 2019, and every 3rd year thereafter, require the board to recompute the gasoline and diesel excise tax rates based upon the percentage change in the California Consumer Price Index and the percentage change in the fuel efficiency of the state motor vehicle fleet, as transmitted to the board by the Department of Finance, as prescribed.

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(4) Article XIX of the California Constitution requires gasoline excise tax revenues from motor vehicles traveling upon public streets and highways to be deposited in the Highway Users Tax Account, for allocation to city, county, and state transportation purposes. Existing law generally provides for statutory allocation of gasoline excise tax revenues attributable to other modes of transportation, including aviation, boats, agricultural vehicles, and off-highway vehicles, to particular accounts and funds for expenditure on purposes associated with those other modes, except that a specified portion of these gasoline excise tax revenues is deposited in the General Fund. Expenditure of the gasoline excise tax revenues attributable to those other modes is not restricted by Article XIX of the California Constitution.

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This bill, commencing July 1, 2016, would instead transfer to the Highway Users Tax Account for allocation to state and local transportation purposes under a specified formula the portion of gasoline excise tax revenues currently being deposited in the General Fund that are attributable to boats, agricultural vehicles, and off-highway vehicles. Because that account is continuously appropriated, the bill would make an appropriation.

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(5) Existing law, beyond the sales and use tax rate generally applicable, imposes an additional sales and use tax on diesel fuel at the rate of 1.75%, subject to certain exemptions, and provides for the net revenues collected from the additional tax to be transferred to the Public Transportation Account. Existing law continuously appropriates these revenues to the Controller, for allocation by formula to transportation agencies for public transit purposes.

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This bill, as of July 1, 2016, would increase the additional sales and use tax rate on diesel fuel to 5.25%. By increasing revenues that are continuously appropriated, the bill would thereby make an appropriation. The bill would restrict expenditures of revenues from the July 1, 2016, increase in the sales and use tax on diesel fuel to transit capital purposes and certain transit services. The bill would require an existing required audit of transit operator finances to verify that these new revenues have been expended in conformance with these specific restrictions and all other generally applicable requirements.

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This bill, as of July 1, 2016, would transfer revenues from the additional sales and use tax on diesel fuel at the 1.75% rate to the Transportation Debt Service Fund for the purpose of paying current year debt service on certain transportation general obligation bonds, rather than to the Public Transportation Account. The bill would also transfer an equivalent amount of revenues from the Greenhouse Gas Reduction Fund to the Public Transportation Account.

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

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Existing law continuously appropriates 10% of the annual proceeds of the fund to the Transit and Intercity Rail Capital Program and 5% of the annual proceeds of the fund to the Low Carbon Transit Operations Program.

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This bill would instead continuously appropriate 20% of those annual proceeds to the Transit and Intercity Rail Capital Program, and 10% of those annual proceeds to the Low Carbon Transit Operations Program, thereby making an appropriation.

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Existing law continuously appropriates 25% of the annual proceeds of the fund to the High-Speed Rail Authority for specified components of the initial operating segment of the high-speed rail line and the Phase I Blended System.

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This bill, commencing no earlier than the 2016-17 fiscal year, would require the authority, from the funds it expects to receive over time under these provisions, to set aside $550,000,000 for capital improvements on intercity and commuter rail lines and urban rail systems that provide connectivity to the high-speed rail system and for other rail capital purposes, as specified. The bill would require the moneys to be programmed to projects on a competitive basis by the California Transportation Commission in consultation with the authority. By authorizing expenditure of continuously appropriated funds for a new purpose, the bill would thereby make an appropriation.

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(7) Existing law provides for transfer of certain vehicle weight fee revenues and certain miscellaneous revenues in the State Highway Account to the Transportation Debt Service Fund to reimburse the General Fund for payment of current year debt service on general obligation bonds issued for transportation purposes. Existing law, under specified circumstances, also authorizes the transfer of certain vehicle weight fee revenues to the Transportation Bond Direct Payment Account for the direct payment of debt service on designated bonds, as defined. Existing law provides for loans of weight fee revenues not immediately needed for debt service purposes to the General Fund under certain circumstances, to be repaid as needed for future debt service payments.

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This bill, notwithstanding these provisions, would limit the amount of vehicle weight fee revenues that may be transferred each year to the Transportation Debt Service Fund or the Transportation Bond Direct Payment Account to the amount of revenues necessary to pay current year debt service only on specified bond measures and would specifically exclude debt service for Proposition 1A (2008) bonds issued for high-speed rail and associated purposes. The bill would prohibit loans of vehicle weight fee revenues to the General Fund. The bill would require the Department of Finance, in consultation with the Transportation Agency and the California Transportation Commission, to develop a plan for implementation, in whole or in part, beginning in the 2021-22 fiscal year, to restore 100% of net weight fee revenues to the State Highway Account. The bill would also eliminate the transfer of miscellaneous revenues from the State Highway Account to the Transportation Debt Service Fund.

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This bill would provide for the transfer of revenues from the Greenhouse Gas Reduction Fund to the Transportation Debt Service Fund in the amount necessary, as determined by the Director of Finance, to pay current year debt service for Proposition 1A (2008) bonds. The bill would also provide for transfer of certain diesel sales tax revenues to the Transportation Debt Service Fund for payment of debt service previously funded by miscellaneous revenues in the State Highway Account.

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(8) Existing law authorizes the issuance, following voter approval, of general obligation bonds for certain purposes, including transportation, and authorizes the Treasurer to issue refunding bonds under certain conditions with respect to those bonds. Existing law enacts various general obligation bond acts under which the proceeds from issuance of those bonds are to be expended on transportation purposes.

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This bill would require the Treasurer to calculate and report to the Department of Finance, by November 15 of each year, the projected reduction in General Fund debt service expenditures for the upcoming fiscal year due to the issuance of refunding bonds relative to general obligation bonds issued for transportation purposes. The bill would require the annual Budget Act to contain an appropriation from the General Fund to the California Transportation Commission of an amount equivalent to that projected reduction, for allocation by the commission to public agencies for high-priority maintenance and rehabilitation purposes on state and local highways, streets, and roads.

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(9) Existing law establishes in state government the Transportation Agency, which includes various departments and state entities, including the California Transportation Commission. Existing law vests the California Transportation Commission with specified powers, duties, and functions relative to transportation matters. Existing law requires the commission to retain independent authority to perform the duties and functions prescribed to it under any provision of law.

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This bill would exclude the California Transportation Commission from the Transportation Agency, establish it as an entity in state government, and require it to act in an independent oversight role. The bill would also make conforming changes.

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(10) Existing law requires the Department of Transportation to prepare a state highway operation and protection program every other year for the expenditure of transportation capital improvement funds for projects that are necessary to preserve and protect the state highway system, excluding projects that add new traffic lanes. The program is required to be based on an asset management plan, as specified. Existing law requires the department to specify, for each project in the program, the capital and support budget and projected delivery date for various components of the project. Existing law provides for the California Transportation Commission to review and adopt the program, and authorizes the commission to decline to adopt the program if it determines that the program is not sufficiently consistent with the asset management plan.

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This bill would additionally require the department to program capital outlay support resources for each project in the program. The bill would provide that the commission is not required to approve the program in its entirety, as submitted by the department, and may approve or reject individual projects programmed by the department. The bill would require the department to submit any change in a programmed project’s cost, scope, or schedule to the commission for its approval.

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This bill, on and after February 1, 2017, would also require the commission to make an allocation of all capital and support costs for each project in the program, and would require the department to submit a supplemental project allocation request to the commission for each project that experiences cost increases above the amounts in its allocation. The bill would require the commission to establish guidelines to provide exceptions to the requirement for a supplemental project allocation requirement that the commission determines are necessary to ensure that projects are not unnecessarily delayed.

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(11) Existing law requires the Department of Transportation to prepare and submit to the Governor a proposed budget and to develop budgeting, accounting, fiscal control, and management information systems to provide budget oversight.

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This bill, by July 1, 2016, would require the department to present to the California Transportation Commission a plan to increase department efficiency by up to 30% over the subsequent 3 years, with the ongoing savings to result in increased capital expenditures in the state highway operation and protection program or an increase in the state highway maintenance program. This bill, by April 1, 2017, would also require the department to present to the commission a 5-year plan to generate additional income from properties owned by the department, including, but not limited to, expeditious offering for sale of properties no longer needed for highway purposes and joint use of highway property by business activities that have the potential to generate income for the state without interfering with the needs of the state highway system.

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(12) Existing law creates various state transportation agencies, including the Department of Transportation and the High-Speed Rail Authority, with specified powers and duties. Existing law provides for the allocation of state transportation funds to various transportation purposes.

end delete
begin delete

This bill would create the Office of the Transportation Inspector General in state government, as an independent office that would not be a subdivision of any other government entity, to build capacity for self-correction into the government itself and to ensure that all state agencies expending state transportation funds are operating efficiently, effectively, and in compliance with federal and state laws. The bill would provide for the Governor to appoint the Transportation Inspector General for a 6-year term, subject to confirmation by the Senate, and would provide that the Transportation Inspector General may not be removed from office during the term except for good cause. The bill would specify the duties and responsibilities of the Transportation Inspector General, would require an annual report to the Legislature and Governor, and would provide that funding for the office shall, to the extent possible, be from federal transportation funds, with other necessary funding to be made available from the State Highway Account and an account from which high-speed rail activities may be funded.

end delete
begin delete

This bill would create the Division of Active Transportation within the Department of Transportation, with specified duties. The bill would continuously appropriate $100,000,000 annually from the Greenhouse Gas Reduction Fund to the State Highway Account for purposes of the Active Transportation Program. The bill would require the department to update the Highway Design Manual to incorporate the “complete streets” design concept by January 1, 2017.

end delete
begin delete

(13) The California Environmental Quality Act (CEQA) requires a lead agency, as defined, to prepare, or cause to be prepared, and certify the completion of, an environmental impact report on a project that it proposes to carry out or approve that may have a significant effect on the environment or to adopt a negative declaration if it finds that the project will not have that effect. CEQA also requires a lead agency to prepare a mitigated negative declaration for a project that may have a significant effect on the environment if revisions in the project would avoid or mitigate that effect and there is no substantial evidence that the project, as revised, would have a significant effect on the environment.

end delete
begin delete

CEQA, until January 1, 2020, exempts a project or an activity to repair, maintain, or make minor alterations to an existing roadway, as defined, other than a state roadway, if the project or activity is carried out by a city or county with a population of less than 100,000 persons to improve public safety and meets other specified requirements.

end delete
begin delete

This bill would extend the above-referenced exemption until January 1, 2025, and delete the limitation of the exemption to projects or activities in cities and counties with a population of less than 100,000 persons. The bill would also expand the exemption to include state roadways.

end delete
begin delete

This bill would also establish the Advance Transportation Project Mitigation Program. The bill would authorize the Natural Resources Agency to administer and implement the program to provide effective mitigation and conservation of natural resources and natural processes on a landscape, regional, or statewide scale, to expedite the environmental review of planned transportation projects, and to facilitate the implementation of measures to mitigate the impacts of those projects by identifying and implementing mitigation measures in advance of project approval. The bill also would authorize the agency to acquire, restore, manage, monitor, and preserve lands, waterways, aquatic resources, or fisheries, or fund those actions, in accordance with an approved regional advance mitigation plan or as otherwise specified, and to establish or fund the establishment of mitigation banks or conservation banks and purchase credits at those types of banks. The bill would authorize the agency to take other actions with respect to mitigation credits or values created or acquired under the program.

end delete
begin delete

This bill would authorize a transportation agency, as defined, to identify planned transportation projects for the purpose of including the projects in a regional advance mitigation plan or for other advance mitigation under the program, and would authorize the agency to enter into a memorandum of understanding or other agreement with the transportation agency for specified purposes of the program.

end delete
begin delete

This bill would establish the Advance Transportation Project Mitigation Fund in the State Treasury. Upon appropriation by the Legislature, the bill would require moneys in the fund to be used by the agency to administer and implement the program.

end delete
begin delete

This bill would specify that the program is intended to improve the efficiency and efficacy of mitigation only and is not intended to supplant the requirements of the CEQA or any other environmental law.

end delete
begin delete

(14) Existing federal law requires the United States Secretary of Transportation to carry out a surface transportation project delivery program, under which the participating states assume certain responsibilities for environmental review and clearance of transportation projects that would otherwise be the responsibility of the federal government. Existing law, until January 1, 2017, provides that the State of California consents to the jurisdiction of the federal courts with regard to the compliance, discharge, or enforcement of the responsibilities the Department of Transportation assumed as a participant in this program.

end delete
begin delete

This bill would delete the January 1, 2017, repeal date, thereby extending these provisions indefinitely.

end delete
begin delete

(15) Existing law authorizes the Department of Transportation and regional transportation agencies, as defined, to enter into comprehensive development lease agreements with public and private entities, or consortia of those entities, for certain transportation projects that may charge certain users of those projects tolls and user fees, subject to various terms and requirements. These arrangements are commonly known as public-private partnerships. Existing law provides that a lease agreement may not be entered into under these provisions on or after January 1, 2017.

end delete
begin delete

This bill would authorize those lease agreements to be entered into on or after that date, add the Santa Clara Valley Transportation Authority as an eligible regional transportation entity that may enter into those agreements, and make technical changes.

end delete
begin delete

(16) This bill would declare that it is to take effect immediately as an urgency statute.

end delete

Vote: 23. Appropriation: yes. Fiscal committee: yes. State-mandated local program: no.

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

P19   1begin insert

begin insertSECTION 1.end insert  

end insert
begin insert

The Legislature finds and declares all of the
2following:

end insert
begin insert

3
(a) Over the next 10 years, the state faces a $59 billion shortfall
4to adequately maintain the existing state highway system in order
5to keep it in a basic state of good repair.

end insert
begin insert

6
(b) Similarly, cities and counties face a $78 billion shortfall
7over the next decade to adequately maintain the existing network
8of local streets and roads.

end insert
begin insert

9
(c) Statewide taxes and fees dedicated to the maintenance of
10the system have not been increased in more than 20 years, with
11those revenues losing more than 55 percent of their purchasing
12power, while costs to maintain the system have steadily increased
13and much of the underlying infrastructure has aged past its
14expected useful life.

end insert
begin insert

15
(d) California motorists are spending $17 billion annually in
16extra maintenance and car repair bills, which is more than $700
17per driver, due to the state’s poorly maintained roads.

end insert
begin insert

P20   1
(e) Failing to act now to address this growing problem means
2that more drastic measures will be required to maintain our system
3in the future, essentially passing the burden on to future
4generations instead of doing our job today.

end insert
begin insert

5
(f) A funding program will help address a portion of the
6maintenance backlog on the state’s road system and will stop the
7growth of the problem.

end insert
begin insert

8
(g) Modestly increasing various fees can spread the cost of road
9repairs broadly to all users and beneficiaries of the road network
10without overburdening any one group.

end insert
begin insert

11
(h) Improving the condition of the state’s road system will have
12a positive impact on the economy as it lowers the transportation
13costs of doing business, reduces congestion impacts for employees,
14and protects property values in the state.

end insert
begin insert

15
(i) The federal government estimates that increased spending
16on infrastructure creates more than 13,000 jobs per $1 billion
17spent.

end insert
begin insert

18
(j) Well-maintained roads benefit all users, not just drivers, as
19roads are used for all modes of transport, whether motor vehicles,
20transit, bicycles, or pedestrians.

end insert
begin insert

21
(k) Well-maintained roads additionally provide significant health
22benefits and prevent injuries and death due to crashes caused by
23poorly maintained infrastructure.

end insert
begin insert

24
(l) A comprehensive, reasonable transportation funding package
25will do all of the following:

end insert
begin insert

26
(1) Ensure these transportation needs are addressed.

end insert
begin insert

27
(2) Fairly distribute the economic impact of increased funding.

end insert
begin insert

28
(3) Restore the gas tax rate previously reduced by the State
29Board of Equalization pursuant to the gas tax swap.

end insert
begin insert

30
(4) Direct increased revenue to the state’s highest transportation
31needs.

end insert
32begin insert

begin insertSEC. 2.end insert  

end insert

begin insertSection 13975 of the end insertbegin insertGovernment Codeend insertbegin insert is amended to
33read:end insert

34

13975.  

There is in the state government the Transportation
35Agency. The agency consists of the Department of the California
36Highway Patrol, thebegin delete California Transportation Commission, theend delete
37 Department of Motor Vehicles, the Department of Transportation,
38the High-Speed Rail Authority, and the Board of Pilot
39Commissioners for the Bays of San Francisco, San Pablo, and
40Suisun.

P21   1begin insert

begin insertSEC. 3.end insert  

end insert

begin insertSection 14033 is added to the end insertbegin insertGovernment Codeend insertbegin insert, to
2read:end insert

begin insert
3

begin insert14033.end insert  

On or before January 1, 2017, the department shall
4update the Highway Design Manual to incorporate the “complete
5streets” design concept.

end insert
6begin insert

begin insertSEC. 4.end insert  

end insert

begin insertPart 5.1 (commencing with Section 14460) is added
7to Division 3 of Title 2 of the end insert
begin insertGovernment Codeend insertbegin insert, to read:end insert

begin insert

8 

9PART begin insert5.1.end insert  OFFICE OF THE TRANSPORTATION INSPECTOR
10GENERAL

11

 

12

begin insert14460.end insert  

(a) There is hereby created in state government the
13independent Office of the Transportation Inspector General, which
14shall not be a subdivision of any other governmental entity, to
15ensure that the Department of Transportation, the High-Speed
16Rail Authority, the Department of the California Highway Patrol,
17the Department of Motor Vehicles, the State Air Resources Board,
18and all other state agencies expending state transportation funds
19are operating efficiently, effectively, and in compliance with
20applicable federal and state laws.

21
(b) The Governor shall appoint, subject to confirmation by the
22Senate, the Transportation Inspector General to a six-year term.
23The Transportation Inspector General may not be removed from
24 office during that term, except for good cause. A finding of good
25cause may include substantial neglect of duty, gross misconduct,
26or conviction of a crime. The reasons for removal of the
27Transportation Inspector General shall be stated in writing and
28shall include the basis for removal. The writing shall be sent to
29the Secretary of the Senate and the Chief Clerk of the Assembly at
30the time of the removal and shall be deemed to be a public
31document.

32

begin insert14461.end insert  

The Transportation Inspector General shall review
33policies, practices, and procedures and conduct audits and
34investigations of activities involving state transportation funds in
35consultation with all affected state agencies. Specifically, the
36Transportation Inspector General’s duties and responsibilities
37shall include, but not be limited to, all of the following:

38
(a) To examine the operating practices of all state agencies
39expending state transportation funds to identify fraud and waste,
P22   1opportunities for efficiencies, and opportunities to improve the
2data used to determine appropriate project resource allocations.

3
(b) To identify best practices in the delivery of transportation
4projects and develop policies or recommend proposed legislation
5enabling state agencies to adopt these practices when practicable.

6
(c) To provide objective analysis of and, when possible, offer
7solutions to concerns raised by the public or generated within
8agencies involving the state’s transportation infrastructure and
9project delivery methods.

10
(d) To conduct, supervise, and coordinate audits and
11investigations relating to the programs and operations of all state
12transportation agencies with state-funded transportation projects.

13
(e) To recommend policies promoting economy and efficiency
14in the administration of programs and operations of all state
15agencies with state-funded transportation projects.

16
(f) To ensure that the Secretary of Transportation and the
17Legislature are fully and currently informed concerning fraud or
18other serious abuses or deficiencies relating to the expenditure of
19funds or administration of programs and operations.

20

begin insert14462.end insert  

The Transportation Inspector General shall report at
21least annually to the Governor and Legislature with a summary
22of his or her findings, investigations, and audits. The summary
23shall be posted on the Transportation Inspector General’s Internet
24Web site and shall otherwise be made available to the public upon
25its release to the Governor and Legislature. The summary shall
26include, but need not be limited to, significant problems discovered
27by the Transportation Inspector General and whether
28recommendations of the Transportation Inspector General relative
29to investigations and audits have been implemented by the affected
30agencies. The report shall be submitted to the Legislature in
31compliance with Section 9795.

end insert
32begin insert

begin insertSEC. 5.end insert  

end insert

begin insertSection 14500 of the end insertbegin insertGovernment Codeend insertbegin insert is amended to
33read:end insert

34

14500.  

There is inbegin delete the Transportation Agencyend deletebegin insert state governmentend insert
35 a California Transportation Commission.begin insert The commission shall
36act in an independent oversight role.end insert

37begin insert

begin insertSEC. 6.end insert  

end insert

begin insertSection 14526.5 of the end insertbegin insertGovernment Codeend insertbegin insert is amended
38to read:end insert

39

14526.5.  

(a) Based on the asset management plan prepared
40and approved pursuant to Section 14526.4, the department shall
P23   1prepare a state highway operation and protection program for the
2expenditure of transportation funds for major capital improvements
3that are necessary to preserve and protect the state highway system.
4Projects included in the program shall be limited tobegin delete capitalend delete
5 improvements relative to maintenance, safety,begin insert rehabilitation,end insert and
6begin delete rehabilitationend deletebegin insert operationend insert of state highways and bridges that do not
7add a new traffic lane to the system.

8(b) The program shall include projects that are expected to be
9advertised prior to July 1 of the year following submission of the
10program, but which have not yet been funded. The program shall
11include those projects for which construction is to begin within
12four fiscal years, starting July 1 of the year following the year the
13program is submitted.

14(c) begin insert(1)end insertbegin insertend insertThe department, at a minimum, shall specify, for each
15project in the state highway operation and protection program, the
16capital and supportbegin delete budget, as well as a projected delivery date,end delete
17begin insert budgetend insert for each of the following project components:

begin delete

18(1) Completion of project

end delete

19begin insert(A)end insertbegin insertend insertbegin insertProjectend insert approval and environmental documents.

begin delete

20(2) Preparation of plans,

end delete

21begin insert(B)end insertbegin insertend insertbegin insertPlans,end insert specifications, and estimates.

begin delete

22(3) Acquisition of rights-of-way, including, but not limited to,
23support activities.

end delete
begin insert

24
(C) Rights-of-way.

end insert
begin insert

25
(D) Construction.

end insert
begin insert

26
(2) The department shall specify, for each project in the state
27highway operation and protection program, a projected delivery
28date for each of the following components:

end insert
begin insert

29
(A) Environmental document completion.

end insert
begin insert

30
(B) Plans, specifications, and estimate completion.

end insert
begin insert

31
(C) Right-of-way certification.

end insert
begin delete

32(4)

end delete

33begin insert(D)end insert Start of construction.

34(d) Thebegin delete program shall be submittedend deletebegin insert department shall submit its
35proposed programend insert
to the commission not later than January 31 of
36each even-numbered year. Prior to submittingbegin delete the plan, theend deletebegin insert its
37proposed program, theend insert
department shall make a draft of its
38proposed program available to transportation planning agencies
39for review and comment and shall include the comments in its
40submittal to the commission.begin insert The department shall provide the
P24   1commission with detailed information for all programmed projects,
2including, but not limited to, cost, scope, schedule, and
3performance metrics as determined by the commission.end insert

4(e) The commissionbegin delete mayend deletebegin insert shallend insert review thebegin insert proposedend insert program
5relative to its overall adequacy, consistency with the asset
6management plan prepared and approved pursuant to Section
714526.4 and funding priorities established in Section 167 of the
8Streets and Highways Code, the level of annual funding needed
9to implement the program, and the impact of those expenditures
10on the state transportation improvement program. The commission
11shall adopt the program and submit it to the Legislature and the
12Governor not later than April 1 of each even-numbered year. The
13commission may decline to adopt the program if the commission
14determines that the program is not sufficiently consistent with the
15asset management plan prepared and approved pursuant to Section
1614526.4.

begin insert

17
(f) As part of the commission’s review of the program required
18pursuant to subdivision (a), the commission shall hold at least one
19hearing in northern California and one hearing in southern
20California regarding the proposed program.

end insert
begin delete

21(f)

end delete

22begin insert(g)end insert Expenditures for these projects shall not be subject to
23Sections 188 and 188.8 of the Streets and Highways Code.

begin insert

24
(h) Following adoption of the state highway operation and
25protection program by the commission, any change to a
26programmed project shall be submitted as an amendment by the
27department to the commission for its approval before the change
28may be implemented.

end insert
29begin insert

begin insertSEC. 7.end insert  

end insert

begin insertSection 14526.7 is added to the end insertbegin insertGovernment Codeend insertbegin insert, to
30read:end insert

begin insert
31

begin insert14526.7.end insert  

(a) On and after February 1, 2017, an allocation by
32the commission of all capital and support costs for each project
33in the state highway operation and protection program shall be
34required.

35
(b) For a project that experiences increases in capital or support
36costs above the amounts in the commission’s allocation pursuant
37to subdivision (a), a supplemental project allocation request shall
38be submitted by the department to the commission for approval.

39
(c) The commission shall establish guidelines to provide
40exceptions to the requirement of subdivision (b) that the
P25   1commission determines are necessary to ensure that projects are
2not unnecessarily delayed.

end insert
3begin insert

begin insertSEC. 8.end insert  

end insert

begin insertSection 14534.1 of the end insertbegin insertGovernment Codeend insertbegin insert is repealed.end insert

begin delete
4

14534.1.  

Notwithstanding Section 12850.6 or subdivision (b)
5of Section 12800, as added to this code by the Governor’s
6Reorganization Plan No. 2 of 2012 during the 2011-12 Regular
7Session, the commission shall retain independent authority to
8perform those duties and functions prescribed to it under any
9provision of law.

end delete
10begin insert

begin insertSEC. 9.end insert  

end insert

begin insertSection 16321 is added to the end insertbegin insertGovernment Codeend insertbegin insert, to
11read:end insert

begin insert
12

begin insert16321.end insert  

(a) Notwithstanding any other law, on or before
13September 1, 2016, the Department of Finance shall compute the
14amount of outstanding loans made from the State Highway
15Account, the Motor Vehicle Fuel Account, the Highway Users Tax
16Account, and the Motor Vehicle Account to the General Fund. The
17department shall prepare a loan repayment schedule, pursuant to
18which the outstanding loans shall be repaid, as follows:

19
(1) On or before June 30, 2017, 50 percent of the outstanding
20loan amounts.

21
(2) On or before June 30, 2018, the remainder of the outstanding
22loan amounts.

23
(b) Notwithstanding any other law, as the loans are repaid
24pursuant to this section, the repaid funds shall be transferred in
25the following manner:

26
(1) Fifty percent to cities and counties pursuant to clauses (i)
27and (ii) of subparagraph (C) of paragraph (3) of subdivision (a)
28of Section 2103 of the Streets and Highways Code.

29
(2) Fifty percent to the department for maintenance of the state
30highway system and for purposes of the state highway operation
31and protection program.

32
(c) Funds for loan repayments pursuant to this section are
33hereby appropriated from the Budget Stabilization Account
34pursuant to subclause (II) of clause (ii) of subparagraph (B) of
35paragraph (1) of subdivision (c) of Section 20 of Article XVI of
36the California Constitution.

end insert
37begin insert

begin insertSEC. 10.end insert  

end insert

begin insertSection 16965 of the end insertbegin insertGovernment Codeend insertbegin insert is amended
38to read:end insert

P26   1

16965.  

(a) (1) The Transportation Debt Service Fund is hereby
2created in the State Treasury. Moneys in the fund shall be dedicated
3to all of the following purposes:

4(A) Payment of debt service with respect to designated bonds,
5as defined in subdivision (c) of Section 16773, and as further
6provided in paragraph (3) and subdivision (b).

7(B) To reimburse the General Fund for debt service with respect
8to bonds.

9(C) To redeem or retire bonds, pursuant to Section 16774,
10maturing in a subsequent fiscal year.

11(2) The bonds eligible under subparagraph (B) or (C) of
12 paragraph (1) include bonds issued pursuant to thebegin delete Clean Air and
13Transportation Improvement Act of 1990 (Part 11.5 (commencing
14with Section 99600) of Division 10 of the Public Utilities Code),
15theend delete
Passenger Rail and Clean Air Bond Act of 1990 (Chapter 17
16(commencing with Section 2701) of Division 3 of the Streets and
17Highways Code), the Seismic Retrofit Bond Act of 1996 (Chapter
1812.48 (commencing with Section 8879) of Division 1 of Title 2),
19and the Safe, Reliable High-Speed Passenger Train Bond Act for
20the 21st Century (Chapter 20 (commencing with Section 2704) of
21Division 3 of the Streets and Highways Code), and nondesignated
22bonds under Proposition 1B, as defined in subdivision (c) of
23Section 16773.

24(3) (A) The Transportation Bond Direct Payment Account is
25hereby created in the State Treasury, as a subaccount within the
26Transportation Debt Service Fund, for the purpose of directly
27paying the debt service, as defined in paragraph (4), of designated
28bonds of Proposition 1B, as defined in subdivision (c) of Section
2916773. Notwithstanding Section 13340, moneys in the
30Transportation Bond Direct Payment Account are continuously
31appropriated for payment of debt service with respect to designated
32bonds as provided in subdivision (c) of Section 16773. So long as
33any designated bonds remain outstanding, the moneys in the
34Transportation Bond Direct Payment Account may not be used
35for any other purpose, and may not be borrowed by or available
36for transfer to the General Fund pursuant to Section 16310 or any
37similar law, or to the General Cash Revolving Fund pursuant to
38 Section 16381 or any similar law.

39(B) Once the Treasurer makes a certification that payment of
40debt service with respect to all designated bonds has been paid or
P27   1provided for, any remaining moneys in the Transportation Bond
2Direct Payment Account shall be transferred back to the
3Transportation Debt Service Fund.

4(C) The moneys in the Transportation Bond Direct Payment
5Account shall be invested in the Surplus Money Investment Fund,
6and all investment earnings shall accrue to the account.

7(D) The Controller may establish subaccounts within the
8Transportation Bond Direct Payment Account as may be required
9by the resolution, indenture, or other documents governing any
10designated bonds.

11(4) For purposes of this subdivision and subdivision (b), and
12subdivision (c) of Section 16773, “debt service” means payment
13of all of the following costs and expenses with respect to any
14designated bond:

15(A) The principal of and interest on the bonds.

16(B) Amounts payable as the result of tender on any bonds, as
17described in clause (iv) of subparagraph (B) of paragraph (1) of
18subdivision (d) of Section 16731.

19(C) Amounts payable under any contractual obligation of the
20state to repay advances and pay interest thereon under a credit
21enhancement or liquidity agreement as described in clause (iv) of
22subparagraph (B) of paragraph (1) of subdivision (d) of Section
2316731.

24(D) Any amount owed by the state to a counterparty after any
25offset for payments owed to the state on any hedging contract as
26described in subparagraph (A) of paragraph (2) of subdivision (d)
27of Section 16731.

28(b) From the moneys transferred to the fund pursuant to
29paragraph (2) or (3) of subdivision (c) of Section 9400.4 of the
30Vehicle Code, there shall first be deposited into the Transportation
31Bond Direct Payment Account in each month sufficient funds to
32equal the amount designated in a certificate submitted by the
33Treasurer to the Controller and the Director of Finance at the start
34of each fiscal year, and as may be modified by the Treasurer
35thereafter upon issuance of any new issue of designated bonds or
36upon change in circumstances that requires such a modification.
37This certificate shall be calculated by the Treasurer to identify, for
38each month, the amount necessary to fund all of the debt service
39with respect to all designated bonds. This calculation shall be done
40in a manner provided in the resolution, indenture, or other
P28   1documents governing the designated bonds. In the event that
2transfers to the Transportation Bond Direct Payment Account in
3any month are less than the amounts required in the Treasurer’s
4certificate, the shortfall shall carry over to be part of the required
5payment in the succeeding month or months.

6(c) The state hereby covenants with the holders from time to
7time of any designated bonds that it will not alter, amend, or restrict
8the provisions of subdivision (c) of Section 16773 of the
9Government Code, or Sections 9400, 9400.1, 9400.4, and 42205
10of the Vehicle Code, which provide directly or indirectly for the
11transfer of weight fees to the Transportation Debt Service Fund
12or the Transportation Bond Direct Payment Account, or
13subdivisions (a) and (b) of this section, or reduce the rate of
14imposition of vehicle weight fees under Sections 9400 and 9400.1
15of the Vehicle Code as they existed on the date of the first issuance
16of any designated bonds, if that alteration, amendment, restriction,
17or reduction would result in projected weight fees for the next
18fiscal year determined by the Director of Finance being less than
19two times the maximum annual debt service with respect to all
20outstanding designated bonds, as such calculation is determined
21pursuant to the resolution, indenture, or other documents governing
22the designated bonds. The state may include this covenant in the
23 resolution, indenture, or other documents governing the designated
24bonds.

25(d) Once the required monthly deposit, including makeup of
26any shortfalls from any prior month, has been made pursuant to
27subdivision (b), from moneys transferred to the fund pursuant to
28paragraph (2) or (3) of subdivision (c) of Section 9400.4 of the
29Vehicle Code, or pursuant to Section 16965.1 or 63048.67, the
30Controller shall transfer as an expenditure reduction to the General
31Fund any amount necessary to offset the cost of current year debt
32service payments made from the General Fund with respect to any
33bonds issued pursuant to Proposition 192 (1996) and three-quarters
34of the amount of current year debt service payments made from
35the General Fund with respect to any nondesignated bonds, as
36defined in subdivision (c) of Section 16773, issued pursuant to
37Proposition 1B (2006). In the alternative, these funds may also be
38used to redeem or retire the applicable bonds, pursuant to Section
3916774, maturing in a subsequent fiscal year as directed by the
40Director of Finance.

begin delete end deletebegin delete

P29   1(e) From moneys transferred to the fund pursuant to Section
2183.1 of the Streets and Highways Code, the Controller shall
3transfer as an expenditure reduction to the General Fund any
4amount necessary to offset the cost of current year debt service
5payments made from the General Fund with respect to any bonds
6issued pursuant to Proposition 116 (1990). In the alternative, these
7funds may also be used to redeem or retire the applicable bonds,
8pursuant to Section 16774, maturing in a subsequent fiscal year
9as directed by the Director of Finance.

end delete
begin delete end deletebegin delete

10(f)

end delete

11begin insert(e)end insert Once the required monthly deposit, including makeup of
12any shortfalls from any prior month, has been made pursuant to
13subdivision (b), from moneys transferred to the fund pursuant to
14paragraph (2) or (3) of subdivision (c) of Section 9400.4 of the
15Vehicle Code, or pursuant to Section 16965.1 or 63048.67, the
16Controller shall transfer as an expenditure reduction to the General
17Fund any amount necessary to offset the eligible cost of current
18year debt service payments made from the General Fund with
19respect to any bonds issued pursuant to Proposition 108 (1990)
20and Proposition 1A (2008), and one-quarter of the amount of
21current year debt service payments made from the General Fund
22with respect to any nondesignated bonds, as defined in subdivision
23(c) of Section 16773, issued pursuant to Proposition 1B (2006).
24The Department of Finance shall notify the Controller by July 30
25of every year of the percentage of debt service that is expected to
26be paid in that fiscal year with respect to bond-funded projects that
27qualify as eligible guideway projects consistent with the
28requirements applicable to the expenditure of revenues under
29Article XIX of the California Constitution, and the Controller shall
30make payments only for those eligible projects. In the alternative,
31these funds may also be used to redeem or retire the applicable
32bonds, pursuant to Section 16774, maturing in a subsequent fiscal
33year as directed by the Director of Finance.

begin delete

34(g)

end delete

35begin insert(f)end insert On or before the second business day following the date on
36which transfers are made to the Transportation Debt Service Fund,
37and after the required monthly deposits for that month, including
38makeup of any shortfalls from any prior month, have been made
39to the Transportation Bond Direct Payment Account, the Controller
40shall transfer the funds designated for reimbursement of bond debt
P30   1service with respect to nondesignated bonds, as defined in
2subdivision (c) of Section 16773, and other bonds identified in
3subdivisionsbegin delete (d), (e), and (f)end deletebegin insert (d) and (e)end insert in that month from the
4fund to the General Fund pursuant to this section.

5begin insert

begin insertSEC. 11.end insert  

end insert

begin insertSection 39719 of the end insertbegin insertHealth and Safety Codeend insertbegin insert is
6amended to read:end insert

7

39719.  

(a) The Legislature shall appropriate the annual
8proceeds of the fund for the purpose of reducing greenhouse gas
9emissions in this state in accordance with the requirements of
10Section 39712.

11(b) To carry out a portion of the requirements of subdivision
12(a), annual proceeds are continuously appropriated for the
13following:

14(1) Beginning in thebegin delete 2015-16end deletebegin insert 2016-17end insert fiscal year, and
15notwithstanding Section 13340 of the Government Code,begin delete 35end deletebegin insert 50end insert
16 percent of annual proceeds are continuously appropriated, without
17regard to fiscal years, for transit, affordable housing, and
18sustainable communities programs as following:

19(A) begin deleteTen end deletebegin insertTwenty end insertpercent of the annual proceeds of the fund is
20hereby continuously appropriated to the Transportation Agency
21for the Transit and Intercity Rail Capital Program created by Part
222 (commencing with Section 75220) of Division 44 of the Public
23Resources Code.

24(B) begin deleteFive end deletebegin insertTen end insertpercent of the annual proceeds of the fund is hereby
25continuously appropriated to the Low Carbon Transit Operations
26Program created by Part 3 (commencing with Section 75230) of
27Division 44 of the Public Resources Code.begin delete Fundsend deletebegin insert Moneysend insert shall be
28allocated by the Controller, according to requirements of the
29program, and pursuant to the distribution formula in subdivision
30(b) or (c) of Section 99312 of, and Sections 99313 and 99314 of,
31the Public Utilities Code.

32(C) Twenty percent of the annual proceeds of the fund is hereby
33continuously appropriated to the Strategic Growth Council for the
34Affordable Housing and Sustainable Communities Program created
35by Part 1 (commencing with Section 75200) of Division 44 of the
36Public Resources Code. Of the amount appropriated in this
37subparagraph, no less than 10 percent of the annualbegin delete proceeds,end delete
38begin insert proceedsend insert shall be expended for affordable housing, consistent with
39the provisions of that program.

P31   1(2) Beginning in the 2015-16 fiscal year, notwithstanding
2Section 13340 of the Government Code, 25 percent of the annual
3proceeds of the fund is hereby continuously appropriated to the
4High-Speed Rail Authority for the following components of the
5initial operating segment and Phase I Blended System as described
6in the 2012 business plan adopted pursuant to Section 185033 of
7the Public Utilities Code:

8(A) Acquisition and construction costs of the project.

9(B) Environmental review and design costs of the project.

10(C) Other capital costs of the project.

11(D) Repayment of any loans made to the authority to fund the
12project.

13(c) In determining the amount of annual proceeds of the fund
14for purposes of the calculation in subdivision (b), the funds subject
15to Section 39719.1 shall not be included.

16begin insert

begin insertSEC. 12.end insert  

end insert

begin insertSection 21080.37 of the end insertbegin insertPublic Resources Codeend insertbegin insert is
17amended to read:end insert

18

21080.37.  

(a) This division does not apply to a project or an
19activity to repair, maintain, or make minor alterations to an existing
20roadway if all of the following conditions are met:

begin delete

21(1) The project is carried out by a city or county with a
22population of less than 100,000 persons to improve public safety.

end delete
begin delete

23(2)

end delete

24begin insert(1)end insert (A) The project does not cross a waterway.

25(B) For purposes of this paragraph, “waterway” means a bay,
26estuary, lake, pond, river, slough, or a perennial, intermittent, or
27ephemeral stream, lake, or estuarine-marine shoreline.

begin delete

28(3)

end delete

29begin insert(2)end insert The project involves negligible or no expansion of an
30existing use beyond that existing at the time of the lead agency’s
31determination.

begin delete end deletebegin delete

32(4) The roadway is not a state roadway.

end delete
begin delete end deletebegin delete

33(5)

end delete

34begin insert(3)end insert (A) The site of the project does not contain wetlands or
35riparian areas and does not have significant value as a wildlife
36habitat, and the project does not harm any species protected by the
37federal Endangered Species Act of 1973 (16 U.S.C. Sec. 1531 et
38seq.), the Native Plant Protection Act (Chapter 10 (commencing
39with Section 1900) of Division 2 of the Fish and Game Code), or
40the California Endangered Species Act (Chapter 1.5 (commencing
P32   1with Section 2050) of Division 3 of the Fish and Game Code), and
2the project does not cause the destruction or removal of any species
3protected by a local ordinance.

4(B) For the purposes of this paragraph:

5(i) “Riparian areas” mean those areas transitional between
6terrestrial and aquatic ecosystems and that are distinguished by
7gradients in biophysical conditions, ecological processes, and biota.
8A riparian area is an area through which surface and subsurface
9hydrology connect waterbodies with their adjacent uplands. A
10riparian area includes those portions of terrestrial ecosystems that
11significantly influence exchanges of energy and matter with aquatic
12ecosystems. A riparian area is adjacent to perennial, intermittent,
13and ephemeral streams, lakes, and estuarine-marine shorelines.

14(ii) “Significant value as a wildlife habitat” includes wildlife
15habitat of national, statewide, regional, or local importance; habitat
16for species protected by the federal Endangered Species Act of
171973 (16 U.S.C. Sec. 1531, et seq.), the California Endangered
18Species Act (Chapter 1.5 (commencing with Section 2050) of
19Division 3 of the Fish and Game Code), or the Native Plant
20Protection Act (Chapter 10 (commencing with Section 1900) of
21Division 2 of the Fish and Game Code); habitat identified as
22candidate, fully protected, sensitive, or species of special status
23by local, state, or federal agencies; or habitat essential to the
24movement of resident or migratory wildlife.

25(iii) “Wetlands” has the same meaning as in the United States
26Fish and Wildlife Service Manual, Part 660 FW 2 (June 21, 1993).

27(iv) “Wildlife habitat” means the ecological communities upon
28which wild animals, birds, plants, fish, amphibians, and
29invertebrates depend for their conservation and protection.

begin delete

30(6)

end delete

31begin insert(4)end insert The project does not impact cultural resources.

begin delete

32(7)

end delete

33begin insert(5)end insert The roadway does not affect scenic resources, as provided
34pursuant to subdivision (c) of Section 21084.

35(b) Prior to determining that a project is exempt pursuant to this
36section, the lead agency shall do both of the following:

37(1) Include measures in the project to mitigate potential
38vehicular traffic and safety impacts and bicycle and pedestrian
39safety impacts.

P33   1(2) Hold a noticed public hearing on the project to hear and
2respond to public comments. The hearing on the project may be
3conducted with another noticed lead agency public hearing.
4Publication of the notice shall be no fewer times than required by
5Section 6061 of the Government Code, by the public agency in a
6newspaper of general circulation in the area.

7(c) For purposes of this section, “roadway” means a roadway
8as defined pursuant to Section 530 of the Vehicle Code and the
9previously graded and maintained shoulder that is within a roadway
10right-of-way of no more than five feet from the edge of the
11roadway.

begin insert

12
(d) (1) If a state agency determines that a project is not subject
13to this division pursuant to this section and it approves or
14determines to carry out that project, it shall file a notice with the
15Office of Planning and Research in the manner specified in
16subdivisions (b) and (c) of Section 21108.

end insert
begin delete

17(d) Whenever

end delete

18begin insert(2)end insertbegin insertend insertbegin insertIfend insert a local agency determines that a project is not subject to
19this division pursuant to thisbegin delete section,end deletebegin insert sectionend insert and it approves or
20determines to carry out that project,begin delete the local agencyend deletebegin insert itend insert shall file
21a notice with the Office of Planning and Research, and with the
22county clerk in the county in which the project will be located in
23the manner specified in subdivisions (b) and (c) of Section 21152.

begin delete end deletebegin delete

24(e) This section shall remain in effect only until January 1, 2020,
25and as of that date is repealed, unless a later enacted statute, that
26is enacted before January 1, 2020, deletes or extends that date.

end delete
begin delete end delete
27begin insert

begin insertSEC. 13.end insert  

end insert

begin insertDivision 13.6 (commencing with Section 21200) is
28added to the end insert
begin insertPublic Resources Codeend insertbegin insert, to read:end insert

begin insert

29 

30Division begin insert13.6.end insert  ADVANCE MITIGATION PROGRAM ACT

31

 

32Chapter  begin insert1.end insert General
33

 

34

begin insert21200.end insert  

This division shall be known, and may be cited, as the
35Advance Mitigation Program Act.

36

begin insert21201.end insert  

(a) The purpose of this division is to improve the
37success and effectiveness of actions implemented to mitigate the
38natural resource impacts of future transportation projects by
39establishing the means to implement those actions well before the
40transportation projects are constructed. The advance identification
P34   1and implementation of mitigation actions also will streamline the
2delivery of transportation projects by anticipating mitigation
3requirements for planned transportation projects and avoiding or
4reducing delays associated with environmental permitting. By
5identifying regional or statewide conservation priorities and by
6anticipating the impacts of planned transportation projects on a
7regional or statewide basis, mitigation actions can be designed to
8protect and restore California’s most valuable natural resources
9and also facilitate environmental compliance for planned
10transportation projects on a regional scale.

11
(b) This division is not intended to create a new environmental
12permitting or regulatory program or to modify existing
13environmental laws or regulations, nor is it expected that all
14mitigation requirements will be addressed for planned
15transportation projects. Instead, it is intended to provide a
16methodology with which to anticipate and fulfill the requirements
17of existing state and federal environmental laws that protect fish,
18wildlife, plant species, and other natural resources more efficiently
19and effectively.

20

begin insert21202.end insert  

The Legislature finds and declares all of the following:

21
(a) The minimization and mitigation of environmental impacts
22is ordinarily handled on a project-by-project basis, usually near
23the end of a project’s timeline and often without guidance
24regarding regional or statewide conservation priorities.

25
(b) The cost of critical transportation projects often escalates
26because of permitting delays that occur when appropriate
27conservation and mitigation measures cannot easily be identified
28and because the cost of these measures often increases between
29the time a project is planned and funded and the time mitigation
30is implemented.

31
(c) Addressing conservation and mitigation needs early in a
32project’s timeline, during the project design and development
33phase, can reduce costs, allow natural resources conservation to
34be integrated with project siting and design, and result in the
35establishment of more valuable and productive habitat mitigation.

36
(d) When the Department of Transportation is able to anticipate
37the mitigation needs for planned transportation projects, it can
38meet those needs in a more timely and cost-effective way by using
39advance mitigation planning.

P35   1
(e) Working with state and federal resource protection agencies,
2the department can identify, conserve, and, where appropriate,
3restore lands for mitigation of numerous projects early in the
4projects’ timelines, thereby allowing public funds to stretch further
5by acquiring habitat at a lower cost and avoiding environmental
6permitting delays.

7
(f) Advance mitigation can provide an effective means of
8facilitating delivery of transportation projects while ensuring more
9effective natural resource conservation.

10
(g) Advance mitigation is needed to direct mitigation funding
11for transportation projects to agreed-upon conservation priorities
12and to the creation of habitat reserves and recreation areas that
13enhance the sustainability of human and natural systems by
14protecting or restoring connectivity of natural communities and
15the delivery of ecosystem services.

16
(h) Advance mitigation can facilitate the implementation of
17climate change adaptation strategies both for ecosystems and
18California’s economy.

19
(i) Advance mitigation can enable the state to protect, restore,
20and recover its natural resources as it strengthens and improves
21its transportation systems.

22

begin insert21203.end insert  

The Legislature intends to do all of the following by
23enacting this division:

24
(a) Facilitate delivery of transportation projects while ensuring
25more effective natural resource conservation.

26
(b) Develop effective strategies to improve the state’s ability to
27meet mounting demands for transportation improvements and to
28maximize conservation and other public benefits.

29
(c) Achieve conservation objectives of statewide and regional
30importance by coordinating local, state, and federally funded
31natural resource conservation efforts with mitigation actions
32required for impacts from transportation projects.

33
(d) Create administrative, governance, and financial incentives
34and mechanisms necessary to ensure that measures required to
35minimize or mitigate impacts from transportation projects will
36serve to achieve regional or statewide natural resource
37conservation objectives.

 

P36   1Chapter  begin insert2.end insert Definitions
2

 

3

begin insert21204.end insert  

For purposes of this division, the following terms have
4the following meanings:

5
(a) “Acquire” and “acquisition” mean, with respect to land or
6a waterway, acquisition of fee title or purchase of a conservation
7easement, that protects conservation and mitigation values on the
8land or waterway in perpetuity.

9
(b) “Advance mitigation” means mitigation implemented before,
10and in anticipation of, environmental effects of planned
11transportation projects.

12
(c) “Commission” means the California Transportation
13Commission.

14
(d) “Department” means the Department of Transportation.

15
(e) “Transportation agency” means the department, the
16High-Speed Rail Authority, a metropolitan planning organization,
17a regional transportation planning agency, or another public
18agency that implements transportation projects.

19
(f) “Transportation project” means a transportation capital
20improvement project.

21
(g) “Planned transportation project” means a transportation
22project that a transportation agency has concluded is reasonably
23likely to be constructed within 20 years and that has been identified
24to the agency for purposes of this division. A planned
25transportation project may include, but is not limited to, a
26transportation project that has been proposed for approval or that
27has been approved.

28
(h) “Program” means the Advance Mitigation Program
29implemented pursuant to this division.

30
(i) “Regulatory agency” means a state or federal natural
31resource protection agency with regulatory authority over planned
32transportation projects. A regulatory agency includes, but is not
33limited to, the Natural Resources Agency, the Department of Fish
34and Wildlife, California regional water quality control boards,
35the United States Fish and Wildlife Service, the National Marine
36Fisheries Service, the United States Environmental Protection
37Agency, and the United States Army Corps of Engineers.

 

P36   1Chapter  begin insert3.end insert Advance Mitigation Program
2

 

3

begin insert21205.end insert  

(a) The Advance Mitigation Program is hereby created
4in the department to accelerate project delivery and improve
5environmental outcomes of environmental mitigation for planned
6transportation projects.

7
(b) The program may utilize mitigation instruments, including,
8but not limited to, mitigation banks, in lieu of fee programs, and
9conservation easements as defined in Section 815.1 of the Civil
10Code.

11
(c) The department shall track all implemented advance
12mitigation projects to use as credits for environmental mitigation
13for state-sponsored transportation projects.

14
(d) The department may use advance mitigation credits to fulfill
15mitigation requirements of any environmental law for a
16transportation project eligible for the State Transportation
17Improvement Program or the State Highway Operation and
18Protection Program.

19

begin insert21206.end insert  

No later than February 1, 2017, the department shall
20establish an interagency transportation advance mitigation steering
21committee consisting of the department and appropriate state and
22federal regulatory agencies to support the program so that advance
23mitigation can be used as required mitigation for planned
24transportation projects and can provide improved environmental
25outcomes. The committee shall advise the department of
26opportunities to carry out advance mitigation projects, provide
27the best available science, and actively participate in mitigation
28instrument reviews and approvals. The committee shall seek to
29develop streamlining opportunities, including those related to
30landscape scale mitigation planning and alignment of federal and
31state regulations and procedures related to mitigation requirements
32and implementation. The committee shall also provide input on
33crediting, using, and tracking of advance mitigation investments.

34

begin insert21207.end insert  

The Advance Mitigation Fund is hereby created in the
35State Transportation Fund as a revolving fund. Notwithstanding
36Section 13340 of the Government Code, the fund shall be
37continuously appropriated without regard to fiscal years. The
38moneys in the fund shall be programmed by the commission for
39the planning and implementation of advance mitigation projects
40consistent with the purposes of this chapter. After the transfer of
P38   1moneys to the fund for four fiscal years pursuant to subdivision
2(c) of Section 2032 of the Streets and Highways Code, commencing
3in the 2017-18 fiscal year, the program is intended to be
4self-sustaining. Advance expenditures from the fund shall later be
5reimbursed from project funding available at the time a planned
6transportation project is constructed. A maximum of 5 percent of
7available funds may be used for administrative purposes.

end insert
8begin insert

begin insertSEC. 14.end insert  

end insert

begin insertSection 99312.1 of the end insertbegin insertPublic Utilities Codeend insertbegin insert is
9amended to read:end insert

10

99312.1.  

begin insert(a)end insertbegin insertend insertRevenues transferred to the Public Transportation
11Account pursuant to Sections 6051.8 and 6201.8 of the Revenue
12and Taxation Code are hereby continuously appropriated to the
13Controller for allocation as follows:

begin delete

14(a)

end delete

15begin insert(1)end insert Fifty percent for allocation to transportation planning
16agencies, county transportation commissions, and the San Diego
17Metropolitan Transit Development Board pursuant to Section
1899314.

begin delete

19(b)

end delete

20begin insert(2)end insert Fifty percent for allocation to transportation agencies, county
21transportation commissions, and the San Diego Metropolitan
22Transit Development Board for purposes of Section 99313.

begin delete

23 For

end delete

24begin insert(b)end insertbegin insertend insertbegin insertForend insert purposes of this chapter, the revenues allocated pursuant
25to this section shall be subject to the same requirements as revenues
26allocated pursuant to subdivisions (b) and (c), as applicable, of
27Section 99312.

begin insert

28
(c) The revenues transferred to the Public Transportation
29Account that are attributable to the increase in the sales and use
30tax on diesel fuel pursuant to subdivision (b) of Section 6051.8 of
31the Revenue and Taxation Code, as adjusted pursuant to
32subdivision (c) of that section, and subdivision (b) of Section 6201.8
33of the Revenue and Taxation Code, as adjusted pursuant to
34subdivision (c) of that section, upon allocation pursuant to Sections
3599313 and 99314, shall only be expended on the following:

end insert
begin insert

36
(1) Transit capital projects or services to maintain or repair a
37transit operator’s existing transit vehicle fleet or existing transit
38facilities, including rehabilitation or modernization of existing
39vehicles or facilities.

end insert
begin insert

P39   1
(2) The design, acquisition, and construction of new vehicles
2or facilities that improve existing transit services.

end insert
begin insert

3
(3) Transit services that complement local efforts for repair and
4improvement of local transportation infrastructure.

end insert
begin insert

5
(d) (1) Prior to receiving an apportionment of funds pursuant
6to subdivision (c) from the Controller in a fiscal year, a recipient
7transit agency shall submit to the Department of Transportation
8a list of projects proposed to be funded with these funds. The list
9of projects proposed to be funded with these funds shall include
10a description and location of each proposed project, a proposed
11schedule for the project’s completion, and the estimated useful life
12of the improvement. The project list shall not limit the flexibility
13of a recipient transit agency to fund projects in accordance with
14local needs and priorities so long as the projects are consistent
15with subdivision (c).

end insert
begin insert

16
(2) The department shall report to the Controller the recipient
17transit agencies that have submitted a list of projects as described
18in this subdivision and that are therefore eligible to receive an
19apportionment of funds for the applicable fiscal year. The
20Controller, upon receipt of the report, shall apportion funds
21pursuant to Sections 99313 and 99314.

end insert
begin insert

22
(e) For each fiscal year, each recipient transit agency receiving
23an apportionment of funds pursuant to subdivision (c) shall, upon
24expending those funds, submit documentation to the department
25that includes a description and location of each completed project,
26the amount of funds expended on the project, the completion date,
27and the estimated useful life of the improvement.

end insert
begin insert

28
(f) The audit of transit operator finances required pursuant to
29Section 99245 shall verify that the revenues identified in
30subdivision (c) have been expended in conformance with these
31specific requirements and all other generally applicable
32requirements.

end insert
33begin insert

begin insertSEC. 15.end insert  

end insert

begin insertSection 6051.8 of the end insertbegin insertRevenue and Taxation Codeend insertbegin insert is
34amended to read:end insert

35

6051.8.  

(a) Except as provided by Section 6357.3, in addition
36to the taxes imposed by this part, for the privilege of selling
37tangible personal property at retail a tax is hereby imposed upon
38all retailers at the rate of 1.75 percent of the gross receipts of any
39retailer from the sale of all diesel begin delete fuel, as defined in Section 60022,
P40   1sold at retail in this state on and after the operative date of this
2subdivision.end delete
begin insert fuel.end insert

begin delete

3(b) Notwithstanding subdivision (a), for the 2011-12 fiscal year
4only, the rate referenced in subdivision (a) shall be 1.87 percent.

end delete
begin delete

5(c) Notwithstanding subdivision (a), for the 2012-13 fiscal year
6only, the rate referenced in subdivision (a) shall be 2.17 percent.

end delete
begin delete

7(d) Notwithstanding subdivision (a), for the 2013-14 fiscal year
8only, the rate referenced in subdivision (a) shall be 1.94 percent.

end delete
begin insert

9
(b) Except as provided by Section 6357.3, in addition to the
10taxes imposed by this part and by subdivision (a), for the privilege
11of selling tangible personal property at retail a tax is hereby
12imposed upon all retailers at the rate of 3.5 percent of the gross
13receipts of any retailer from the sale of all diesel fuel, as defined
14in Section 60022, sold at retail in this state. The tax imposed under
15this subdivision shall be imposed on and after the first day of the
16first calendar quarter that occurs 90 days after the effective date
17of the act adding this subdivision.

end insert
begin insert

18
(c) Beginning July 1, 2019, and every third year thereafter, the
19State Board of Equalization shall recompute the rates of the taxes
20imposed by this section. That computation shall be made as
21follows:

end insert
begin insert

22
(1) The Department of Finance shall transmit to the State Board
23of Equalization the percentage change in the California Consumer
24Price Index for all items from November of three calendar years
25prior to November of the prior calendar year, no later than January
2631, 2019, and January 31 of every third year thereafter.

end insert
begin insert

27
(2) The State Board of Equalization shall do all of the following:

end insert
begin insert

28
(A) Compute an inflation adjustment factor by adding 100
29percent to the percentage change figure that is furnished pursuant
30to paragraph (1) and dividing the result by 100.

end insert
begin insert

31
(B) Multiply the preceding tax rate per gallon by the inflation
32adjustment factor determined in subparagraph (A) and round off
33the resulting product to the nearest tenth of a cent.

end insert

34(C) Make its determination of the new rate no later than March
351 of the same year as the effective date of the new rate.

begin delete

36(e)

end delete

37begin insert(d)end insert Notwithstanding subdivision (b) of Section 7102, all of the
38revenues, less refunds, collected pursuant to this section shall be
39estimated by the State Board of Equalization, with the concurrence
40of the Department of Finance, and transferred quarterly to the
P41   1Public Transportation Account in the State Transportation Fund
2for allocation pursuant to Section 99312.1 of the Public Utilities
3Code.

begin delete

4(f) Subdivisions (a) to (e), inclusive, shall become operative on
5July 1, 2011.

end delete
6begin insert

begin insertSEC. 16.end insert  

end insert

begin insertSection 6201.8 of the end insertbegin insertRevenue and Taxation Codeend insertbegin insert is
7amended to read:end insert

8

6201.8.  

(a) Except as provided by Section 6357.3, in addition
9to the taxes imposed by this part, an excise tax is hereby imposed
10on the storage, use, or other consumption in this state of diesel
11fuel, as defined in Section 60022, at the rate of 1.75 percent of the
12sales price of the dieselbegin delete fuel on and after the operative date of this
13subdivision.end delete
begin insert fuel.end insert

begin delete

14(b) Notwithstanding subdivision (a), for the 2011-12 fiscal year
15only, the rate referenced in subdivision (a) shall be 1.87 percent.

end delete
begin delete

16(c) Notwithstanding subdivision (a), for the 2012-13 fiscal year
17only, the rate referenced in subdivision (a) shall be 2.17 percent.

end delete
begin delete

18(d) Notwithstanding subdivision (a), for the 2013-14 fiscal year
19only, the rate referenced in subdivision (a) shall be 1.94 percent.

end delete
begin insert

20
(b) Except as provided by Section 6357.3, in addition to the
21taxes imposed by this part and by subdivision (a), an excise tax is
22hereby imposed on the storage, use, or other consumption in this
23state of diesel fuel, as defined in Section 60022, at the rate of 3.5
24percent of the sales price of the diesel fuel. The tax imposed under
25this subdivision shall be imposed on and after the first day of the
26first calendar quarter that occurs 90 days after the effective date
27of the act adding this subdivision.

end insert
begin insert

28
(c) Beginning July 1, 2019, and every third year thereafter, the
29State Board of Equalization shall recompute the rates of the taxes
30imposed by this section. That computation shall be made as
31follows:

end insert
begin insert

32
(1) The Department of Finance shall transmit to the State Board
33of Equalization the percentage change in the California Consumer
34Price Index for all items from November of three calendar years
35prior to November of the prior calendar year, no later than January
3631, 2019, and January 31 of every third year thereafter.

end insert
begin insert

37
(2) The State Board of Equalization shall do all of the following:

end insert
begin insert

38
(A) Compute an inflation adjustment factor by adding 100
39percent to the percentage change figure that is furnished pursuant
40to paragraph (1) and dividing the result by 100.

end insert
begin insert

P42   1
(B) Multiply the preceding tax rate per gallon by the inflation
2adjustment factor determined in subparagraph (A) and round off
3the resulting product to the nearest tenth of a cent.

end insert
begin insert

4
(C) Make its determination of the new rate no later than March
51 of the same year as the effective date of the new rate.

end insert
begin delete

6(e)

end delete

7begin insert(d)end insert Notwithstanding subdivision (b) of Section 7102, all of the
8revenues, less refunds, collected pursuant to this section shall be
9estimated by the State Board of Equalization, with the concurrence
10of the Department of Finance, and transferred quarterly to the
11Public Transportation Account in the State Transportation Fund
12for allocation pursuant to Section 99312.1 of the Public Utilities
13Code.

begin delete

14(f) Subdivisions (a) to (e), inclusive, shall become operative on
15July 1, 2011.

end delete
16begin insert

begin insertSEC. 17.end insert  

end insert

begin insertSection 7360 of the end insertbegin insertRevenue and Taxation Codeend insertbegin insert is
17amended to read:end insert

18

7360.  

(a) (1) begin insert(A)end insertbegin insertend insertA tax of eighteen cents ($0.18) is hereby
19imposed upon each gallon of fuel subject to the tax in Sections
207362, 7363, and 7364.

begin insert

21
(B) In addition to the tax imposed pursuant to subparagraph
22(A), on and after the first day of the first calendar quarter that
23occurs 90 days after the effective date of the act adding this
24subparagraph, a tax of seventeen cents ($0.17) is hereby imposed
25upon each gallon of fuel, other than aviation gasoline, subject to
26the tax in Sections 7362, 7363, and 7364.

end insert

27(2) If the federal fuel tax is reduced below the rate of nine cents
28($0.09) per gallon and federal financial allocations to this state for
29highway and exclusive public mass transit guideway purposes are
30reduced or eliminated correspondingly, the tax rate imposed by
31begin insert subparagraph (A) ofend insert paragraph (1), on and after the date of the
32reduction, shall be recalculated by an amount so that the combined
33state rate underbegin insert subparagraph (A) ofend insert paragraph (1) and the federal
34tax rate per gallon equal twenty-seven cents ($0.27).

35(3) If any person or entity is exempt or partially exempt from
36the federal fuel tax at the time of a reduction, the person or entity
37shall continue to be so exempt under this section.

38(b) begin delete(1)end deletebegin deleteend deleteOn and after July 1, 2010, in addition to the tax imposed
39by subdivision (a), a tax is hereby imposed upon each gallon of
40motor vehicle fuel, other than aviation gasoline, subject to the tax
P43   1in Sections 7362, 7363, and 7364 in an amount equal to seventeen
2and three-tenths cents ($0.173) per gallon.

begin delete

3(2) For the 2011-12 fiscal year and each fiscal year thereafter,
4the board shall, on or before March 1 of the fiscal year immediately
5preceding the applicable fiscal year, adjust the rate in paragraph
6(1) in that manner as to generate an amount of revenue that will
7equal the amount of revenue loss attributable to the exemption
8provided by Section 6357.7, based on estimates made by the board,
9and that rate shall be effective during the state’s next fiscal year.

end delete
begin delete

10(3) In order to maintain revenue neutrality for each year,
11beginning with the rate adjustment on or before March 1, 2012,
12the adjustment under paragraph (2) shall also take into account the
13extent to which the actual amount of revenues derived pursuant to
14this subdivision and, as applicable, Section 7361.1, the revenue
15loss attributable to the exemption provided by Section 6357.7
16resulted in a net revenue gain or loss for the fiscal year ending
17prior to the rate adjustment date on or before March 1.

end delete
begin delete

18(4) The intent of paragraphs (2) and (3) is to ensure that the act
19adding this subdivision and Section 6357.7 does not produce a net
20revenue gain in state taxes.

end delete
begin insert

21
(c) Beginning July 1, 2019, and every third year thereafter, the
22State Board of Equalization shall recompute the rates of the taxes
23imposed by this section. That computation shall be made as
24follows:

end insert
begin insert

25
(1) The Department of Finance shall transmit to the State Board
26of Equalization the percentage change in the California Consumer
27Price Index for all items from November of three calendar years
28prior to November of the prior calendar year, no later than January
2931, 2019, and January 31 of every third year thereafter.

end insert
begin insert

30
(2) The State Board of Equalization shall do all of the following:

end insert
begin insert

31
(A) Compute an inflation adjustment factor by adding 100
32percent to the percentage change figure that is furnished pursuant
33to paragraph (1) and dividing the result by 100.

end insert
begin insert

34
(B) Multiply the preceding tax rate per gallon by the inflation
35adjustment factor determined in subparagraph (A) and round off
36the resulting product to the nearest tenth of a cent.

end insert
begin insert

37
(C) Make its determination of the new rate no later than March
381 of the same year as the effective date of the new rate.

end insert
39begin insert

begin insertSEC. 18.end insert  

end insert

begin insertSection 8352.4 of the end insertbegin insertRevenue and Taxation Codeend insertbegin insert is
40amended to read:end insert

P44   1

8352.4.  

(a) Subject to Sections 8352 and 8352.1, and except
2as otherwise provided in subdivision (b), there shall be transferred
3from the money deposited to the credit of the Motor Vehicle Fuel
4Account to the Harbors and Watercraft Revolving Fund, for
5expenditure in accordance with Division 1 (commencing with
6Section 30) of the Harbors and Navigation Code, the sum of six
7million six hundred thousand dollars ($6,600,000) per annum,
8representing the amount of money in the Motor Vehicle Fuel
9Account attributable to taxes imposed on distributions of motor
10vehicle fuel used or usable in propelling vessels. The actual amount
11shall be calculated using the annual reports of registered boats
12prepared by the Department of Motor Vehicles for the United
13States Coast Guard and the formula and method of the December
141972 report prepared for this purpose and submitted to the
15Legislature on December 26, 1972, by the Director of
16Transportation. If the amount transferred during each fiscal year
17is in excess of the calculated amount, the excess shall be
18retransferred from the Harbors and Watercraft Revolving Fund to
19the Motor Vehicle Fuel Account. If the amount transferred is less
20than the amount calculated, the difference shall be transferred from
21the Motor Vehicle Fuel Account to the Harbors and Watercraft
22Revolving Fund. No adjustment shall be made if the computed
23difference is less than fifty thousand dollars ($50,000), and the
24amount shall be adjusted to reflect any temporary or permanent
25increase or decrease that may be made in the rate under the Motor
26Vehicle Fuel Tax Law. Payments pursuant to this section shall be
27made prior to payments pursuant to Section 8352.2.

28(b) Commencing July 1,begin delete 2012,end deletebegin insert 2016,end insert the revenues attributable
29to the taxes imposed pursuant to subdivision (b) of Section 7360
30and Section 7361.1 and otherwise to be deposited in the Harbors
31and Watercraft Revolving Fund pursuant to subdivision (a) shall
32instead be transferred to thebegin delete General Fund. The revenues
33attributable to the taxes imposedend delete
begin insert Highway Users Tax Account for
34distributionend insert
pursuant tobegin delete subdivision (b) ofend deletebegin delete Sectionend deletebegin delete 7360 and Section
357361.1 that were deposited inend delete
begin insert Section 2103.1 ofend insert thebegin delete Harborsend deletebegin insert Streetsend insert
36 andbegin delete Watercraft Revolving Fund in the 2010-11 and 2011-12 fiscal
37years shall be transferred to the General Fund.end delete
begin insert Highways Code.end insert

38begin insert

begin insertSEC. 19.end insert  

end insert

begin insertSection 8352.5 of the end insertbegin insertRevenue and Taxation Codeend insertbegin insert is
39amended to read:end insert

P45   1

8352.5.  

(a) (1) Subject to Sections 8352 and 8352.1, and
2except as otherwise provided in subdivision (b), there shall be
3transferred from the money deposited to the credit of the Motor
4Vehicle Fuel Account to the Department of Food and Agriculture
5Fund, during the second quarter of each fiscal year, an amount
6equal to the estimate contained in the most recent report prepared
7pursuant to this section.

8(2) The amounts are not subject to Section 6357 with respect
9to the collection of sales and use taxes thereon, and represent the
10portion of receipts in the Motor Vehicle Fuel Account during a
11calendar year that were attributable to agricultural off-highway
12use of motor vehicle fuel which is subject to refund pursuant to
13Section 8101, less gross refunds allowed by the Controller during
14the fiscal year ending Junebegin delete 30thend deletebegin insert 30end insert following the calendar year to
15persons entitled to refunds for agricultural off-highway use
16pursuant to Section 8101. Payments pursuant to this section shall
17be made prior to payments pursuant to Section 8352.2.

18(b) Commencing July 1,begin delete 2012,end deletebegin insert 2016,end insert the revenues attributable
19to the taxes imposed pursuant to subdivision (b) of Section 7360
20and Section 7361.1 and otherwise to be deposited in the
21Department of Food and Agriculture Fund pursuant to subdivision
22(a) shall instead be transferred to thebegin delete General Fund. The revenues
23attributable to the taxes imposedend delete
begin insert Highway Users Tax Account for
24distributionend insert
pursuant tobegin delete subdivision (b) ofend deletebegin delete Sectionend deletebegin delete 7360 and Section
257361.1 that were deposited in the Departmentend delete
begin insert Section 2103.1end insert of
26begin delete Food and Agriculture Fund inend delete thebegin delete 2010-11end deletebegin insert Streetsend insert andbegin delete 2011-12
27fiscal years shall be transferred to the General Fund.end delete
begin insert Highways
28Code.end insert

29(c) On or before September 30, 2012, and on or before
30September 30 of each even-numbered year thereafter, the Director
31of Transportation and the Director of Food and Agriculture shall
32jointly prepare, or cause to be prepared, a report setting forth the
33current estimate of the amount of money in the Motor Vehicle
34Fuel Account attributable to agricultural off-highway use of motor
35vehicle fuel, which is subject to refund pursuant to Section 8101
36less gross refunds allowed by the Controller to persons entitled to
37refunds for agricultural off-highway use pursuant to Section 8101;
38and they shall submit a copy of the report to the Legislature.

39begin insert

begin insertSEC. 20.end insert  

end insert

begin insertSection 8352.6 of the end insertbegin insertRevenue and Taxation Codeend insertbegin insert is
40amended to read:end insert

P46   1

8352.6.  

(a) (1) Subject to Section 8352.1, and except as
2otherwise provided in paragraphs (2) and (3), on the first day of
3every month, there shall be transferred from moneys deposited to
4the credit of the Motor Vehicle Fuel Account to the Off-Highway
5Vehicle Trust Fund created by Section 38225 of the Vehicle Code
6an amount attributable to taxes imposed upon distributions of motor
7vehicle fuel used in the operation of motor vehicles off highway
8and for which a refund has not been claimed. Transfers made
9pursuant to this section shall be made prior to transfers pursuant
10to Section 8352.2.

11(2) Commencing July 1,begin delete 2012,end deletebegin insert 2016,end insert the revenues attributable
12to the taxes imposed pursuant to subdivision (b) of Section 7360
13and Section 7361.1 and otherwise to be deposited in the
14Off-Highway Vehicle Trust Fund pursuant to paragraph (1) shall
15instead be transferred to thebegin delete General Fund. The revenues
16attributable to the taxes imposedend delete
begin insert Highway Users Tax Account for
17distributionend insert
pursuant tobegin delete subdivision (b) ofend deletebegin delete Sectionend deletebegin delete 7360 and Section
187361.1 that were deposited inend delete
begin insert Section 2103.1 ofend insert thebegin delete Off-Highway
19Vehicle Trust Fund in the 2010-11end delete
begin insert Streetsend insert andbegin delete 2011-12 fiscal
20years shall be transferred to the General Fund.end delete
begin insert Highways Code.end insert

21(3) The Controller shall withhold eight hundred thirty-three
22thousand dollars ($833,000) from the monthly transfer to the
23Off-Highway Vehicle Trust Fund pursuant to paragraph (1), and
24transfer that amount to the General Fund.

25(b) The amount transferred to the Off-Highway Vehicle Trust
26Fund pursuant to paragraph (1) of subdivision (a), as a percentage
27of the Motor Vehicle Fuel Account, shall be equal to the percentage
28transferred in the 2006-07 fiscal year. Every five years, starting
29in the 2013-14 fiscal year, the percentage transferred may be
30adjusted by the Department of Transportation in cooperation with
31the Department of Parks and Recreation and the Department of
32Motor Vehicles. Adjustments shall be based on, but not limited
33to, the changes in the following factors since the 2006-07 fiscal
34year or the last adjustment, whichever is more recent:

35(1) The number of vehicles registered as off-highway motor
36vehicles as required by Division 16.5 (commencing with Section
3738000) of the Vehicle Code.

38(2) The number of registered street-legal vehicles that are
39anticipated to be used off highway, including four-wheel drive
40vehicles, all-wheel drive vehicles, and dual-sport motorcycles.

P47   1(3) Attendance at the state vehicular recreation areas.

2(4) Off-highway recreation use on federal lands as indicated by
3the United States Forest Service’s National Visitor Use Monitoring
4and the United States Bureau of Land Management’s Recreation
5Management Information System.

6(c) It is the intent of the Legislature that transfers from the Motor
7Vehicle Fuel Account to the Off-Highway Vehicle Trust Fund
8should reflect the full range of motorized vehicle use off highway
9for both motorized recreation and motorized off-road access to
10other recreation opportunities. Therefore, the Legislature finds that
11the fuel tax baseline established in subdivision (b), attributable to
12off-highway estimates of use as of the 2006-07 fiscal year,
13accounts for the three categories of vehicles that have been found
14over the years to be users of fuel for off-highway motorized
15recreation or motorized access to nonmotorized recreational
16pursuits. These three categories are registered off-highway
17motorized vehicles, registered street-legal motorized vehicles used
18off highway, and unregistered off-highway motorized vehicles.

19(d) It is the intent of the Legislature that the off-highway motor
20vehicle recreational use to be determined by the Department of
21Transportation pursuant to paragraph (2) of subdivision (b) be that
22usage by vehicles subject to registration under Division 3
23(commencing with Section 4000) of the Vehicle Code, for
24recreation or the pursuit of recreation on surfaces where the use
25of vehicles registered under Division 16.5 (commencing with
26Section 38000) of the Vehicle Code may occur.

27(e) In the 2014-15 fiscal year, the Department of Transportation,
28in consultation with the Department of Parks and Recreation and
29the Department of Motor Vehicles, shall undertake a study to
30determine the appropriate adjustment to the amount transferred
31pursuant to subdivision (b) and to update the estimate of the amount
32attributable to taxes imposed upon distributions of motor vehicle
33fuel used in the operation of motor vehicles off highway and for
34which a refund has not been claimed. The department shall provide
35a copy of this study to the Legislature no later than January 1,
362016.

37begin insert

begin insertSEC. 21.end insert  

end insert

begin insertSection 60050 of the end insertbegin insertRevenue and Taxation Codeend insertbegin insert is
38amended to read:end insert

P48   1

60050.  

(a) (1) A tax ofbegin delete eighteenend deletebegin insert thirteenend insert centsbegin delete ($0.18)end deletebegin insert ($0.13)end insert
2 is hereby imposed upon each gallon of diesel fuel subject to the
3tax in Sections 60051, 60052, and 60058.

4(2) If the federal fuel tax is reduced below the rate of fifteen
5cents ($0.15) per gallon and federal financial allocations to this
6state for highway and exclusive public mass transit guideway
7purposes are reduced or eliminated correspondingly, the tax rate
8imposed by paragraphbegin delete (1), including any reduction or adjustment
9pursuant to subdivision (b), on and after the date of the reduction,end delete

10begin insert (1)end insert shall be increased by an amount so that the combined state rate
11under paragraph (1) and the federal tax rate per gallon equal what
12it would have been in the absence of the federal reduction.

13(3) If any person or entity is exempt or partially exempt from
14the federal fuel tax at the time of a reduction, the person or entity
15shall continue to be exempt under this section.

begin delete

16(b) (1) On July 1, 2011, the tax rate specified in paragraph (1)
17of subdivision (a) shall be reduced to thirteen cents ($0.13) and
18every July 1 thereafter shall be adjusted pursuant to paragraphs
19(2) and (3).

end delete
begin delete

20(2) For the 2012-13 fiscal year and each fiscal year thereafter,
21the board shall, on or before March 1 of the fiscal year immediately
22preceding the applicable fiscal year, adjust the rate reduction in
23paragraph (1) in that manner as to result in a revenue loss
24attributable to paragraph (1) that will equal the amount of revenue
25gain attributable to Sections 6051.8 and 6201.8, based on estimates
26made by the board, and that rate shall be effective during the state’s
27next fiscal year.

end delete
begin delete

28(3) In order to maintain revenue neutrality for each year,
29beginning with the rate adjustment on or before March 1, 2013,
30the adjustment under paragraph (2) shall take into account the
31extent to which the actual amount of revenues derived pursuant to
32Sections 6051.8 and 6201.8 and the revenue loss attributable to
33this subdivision resulted in a net revenue gain or loss for the fiscal
34year ending prior to the rate adjustment date on or before March
351.

end delete
begin delete

36(4) The intent of paragraphs (2) and (3) is to ensure that the act
37adding this subdivision and Sections 6051.8 and 6201.8 does not
38produce a net revenue gain in state taxes.

end delete
begin insert

39
(b) In addition to the tax imposed pursuant to subdivision (a),
40on and after the first day of the first calendar quarter that occurs
P49   190 days after the effective date of the act amending this subdivision
2in the 2015 First Extraordinary Session, an additional tax of thirty
3cents ($0.30) is hereby imposed upon each gallon of diesel fuel
4subject to the tax in Sections 60051, 60052, and 60058.

end insert
begin insert

5
(c) Beginning July 1, 2019, and every third year thereafter, the
6State Board of Equalization shall recompute the rates of the taxes
7imposed by this section. That computation shall be made as
8follows:

end insert
begin insert

9
(1) The Department of Finance shall transmit to the State Board
10of Equalization the percentage change in the California Consumer
11 Price Index for all items from November of three calendar years
12prior to November of the prior calendar year, no later than January
1331, 2019, and January 31 of every third year thereafter.

end insert
begin insert

14
(2) The State Board of Equalization shall do all of the following:

end insert
begin insert

15
(A) Compute an inflation adjustment factor by adding 100
16percent to the percentage change figure that is furnished pursuant
17to paragraph (1) and dividing the result by 100.

end insert
begin insert

18
(B) Multiply the preceding tax rate per gallon by the inflation
19adjustment factor determined in subparagraph (A) and round off
20the resulting product to the nearest tenth of a cent.

end insert
begin insert

21
(C) Make its determination of the new rate no later than March
221 of the same year as the effective date of the new rate.

end insert
23begin insert

begin insertSEC. 22.end insert  

end insert

begin insertSection 183.1 of the end insertbegin insertStreets and Highways Codeend insertbegin insert is
24amended to read:end insert

25

183.1.  

begin delete(a)end deletebegin deleteend deletebegin deleteNotwithstanding subdivision (a) of Section 182 or
26any other provision of law, end delete
begin insertExcept as otherwise provided in Section
2754237.7 of the Government Code, end insert
money deposited into the account
28that is not subject to Article XIX of the California Constitution,
29including, but not limited to, money that is derived from the sale
30of documents, charges for miscellaneous services to the public,
31condemnation deposits fund investments, rental of state property,
32or any other miscellaneous uses of property or money,begin delete may be
33used for any transportation purpose authorized by statute, upon
34appropriation by the Legislature or, after transfer to another fund,
35upon appropriation by the Legislature from that fund.end delete
begin insert shall be
36deposited in the Road Maintenance and Rehabilitation Account
37created pursuant to Section 2031.end insert

begin delete

38(b) Commencing with the 2013-14 fiscal year, and not later
39than November 1 of each fiscal year thereafter, based on prior year
40financial statements, the Controller shall transfer the funds
P50   1identified in subdivision (a) for the prior fiscal year from the State
2Highway Account to the Transportation Debt Service Fund in the
3State Transportation Fund, and those funds are continuously
4appropriated for the purposes specified for the Transportation Debt
5Service Fund.

end delete
6begin insert

begin insertSEC. 23.end insert  

end insert

begin insertSection 820.1 of the end insertbegin insertStreets and Highways Codeend insertbegin insert is
7amended to read:end insert

8

820.1.  

(a) The State of California consents to the jurisdiction
9of the federal courts with regard to the compliance, discharge, or
10enforcement of the responsibilities assumed by the department
11pursuant to Section 326 of, and subsection (a) of Section 327 of,
12Title 23 of the United States Code.

13(b) In any action brought pursuant to the federal laws described
14in subdivision (a), no immunity from suit may be asserted by the
15department pursuant to the Eleventh Amendment to the United
16States Constitution, and any immunity is hereby waived.

17(c) The department shall not delegate any of its responsibilities
18assumed pursuant to the federal laws described in subdivision (a)
19to any political subdivision of the state or its instrumentalities.

begin delete end deletebegin delete

20(d) The department shall, no later than January 1, 2016, submit
21a report to the Legislature that includes the following:

end delete
begin delete end deletebegin delete end deletebegin delete

22(1) A comparative analysis of the environmental review process
23under the National Environmental Policy Act (Chapter 55
24(commencing with Section 4321) of Title 42 of the United States
25Code) for the 30 projects, excluding those projects categorically
26excluded from environmental review, undertaken immediately
27preceding the enactment of this section that involved the Federal
28Highway Administration and the environmental review process
29for all projects, excluding those projects categorically excluded
30from environmental review, undertaken following the enactment
31of this section that did not involve the Federal Highway
32Administration. This analysis shall include department- and local
33agency-sponsored projects, and shall address the following:

end delete
begin delete end deletebegin delete end deletebegin delete

34(A) For each project included in the analysis, the environmental
35review process under the National Environmental Policy Act,
36including which state and federal agencies reviewed the
37environmental documents and the amount of time the documents
38were reviewed by each agency, shall be described.

end delete
begin delete end deletebegin delete end deletebegin delete

P51   1(B) The points in the environmental review process under the
2National Environmental Policy Act when project delays occurred
3and the nature of the delays.

end delete
begin delete end deletebegin delete end deletebegin delete

4(C) The time saved in the environmental review process for
5projects undertaken following the enactment of this section in
6comparison to the review process for projects undertaken prior to
7the enactment of this section, and the points in the review process
8when time was saved.

end delete
begin delete end deletebegin delete end deletebegin delete

9(D) The circumstances when the Federal Highway
10Administration hindered and facilitated project delivery.

end delete
begin delete end deletebegin delete end deletebegin delete

11(2) All financial costs incurred by the department to assume the
12responsibilities pursuant to Section 326 of, and subsection (a) of
13Section 327 of, Title 23 of the United States Code, including, but
14not limited to, the following:

end delete
begin delete end deletebegin delete end deletebegin delete

15(A) Personnel to conduct and review environmental documents
16and to manage litigation.

end delete
begin delete end deletebegin delete end deletebegin delete

17(B) Administrative costs.

end delete
begin delete end deletebegin delete end deletebegin delete

18(C) Litigation.

end delete
begin delete end deletebegin delete end deletebegin delete

19(3) An explanation of all litigation initiated against the
20department for the responsibilities assumed pursuant to Section
21326 of, and subsection (a) of Section 327 of, Title 23 of the United
22States Code.

end delete
begin delete end deletebegin delete end deletebegin delete

23(4) A comparison of all costs and benefits of assuming these
24responsibilities.

end delete
begin delete end deletebegin delete end deletebegin delete

25(5) An assessment of overall project delivery time from the time
26environmental studies begin to the time the project is ready to
27advertise for construction, including the time required for each
28project phase and distinguishing between different types of
29environmental documents and between projects on the state
30highway system and local assistance projects. The department may
31also include other variables that it determines may be useful in the
32assessment.

end delete
begin delete end deletebegin delete end deletebegin delete

33(e) (1) This section shall remain in effect only until January 1,
342017, and as of that date is repealed, unless a later enacted statute,
35that is enacted before January 1, 2017, deletes or extends that date.

end delete
begin delete end deletebegin delete end deletebegin delete

36(2) The state shall remain liable for any decisions made, or
37responsibilities assumed and exercised, prior to the repeal of this
38section under this subdivision, pursuant to applicable federal
39statutes of limitation for filing citizens’ suits in federal court.

end delete
begin delete end deletebegin delete

40(f)

end delete

P52   1begin insert(d)end insert Nothing in this section affects the obligation of the
2department to comply with state and federal law.

3begin insert

begin insertSEC. 24.end insert  

end insert

begin insertChapter 2 (commencing with Section 2030) is added
4to Division 3 of the end insert
begin insertStreets and Highways Codeend insertbegin insert, to read:end insert

begin insert

5 

6Chapter  begin insert2.end insert Road Maintenance and Rehabilitation
7Program
8

 

9

begin insert2030.end insert  

(a) The Road Maintenance and Rehabilitation Program
10is hereby created to address deferred maintenance on the state
11highway system and the local street and road system. Funds made
12available by the program shall be prioritized for expenditure on
13basic road maintenance and road rehabilitation projects, and on
14critical safety projects. For funds appropriated pursuant to
15paragraph (1) of subdivision (d) of Section 2032, the California
16Transportation Commission shall adopt performance criteria,
17consistent with the asset management plan required pursuant to
1814526.4 of the Government Code, to ensure efficient use of the
19funds available for these purposes in the program.

20
(b) (1) Funds made available by the program shall be used for
21 projects that include, but are not limited to, the following:

22
(A) Road maintenance and rehabilitation.

23
(B) Safety projects.

24
(C) Railroad grade separations.

25
(D) Complete street components, including active transportation
26purposes, pedestrian and bicycle safety projects, transit facilities,
27and drainage and stormwater capture projects in conjunction with
28any other allowable project.

29
(E) Traffic control devices.

30
(2) Funds made available by the program may also be used to
31satisfy a match requirement in order to obtain state or federal
32funds for projects authorized by this subdivision.

33

begin insert2031.end insert  

The following revenues shall be deposited in the Road
34Maintenance and Rehabilitation Account, which is hereby created
35in the State Transportation Fund:

36
(a) Notwithstanding subdivision (b) of Section 2103, the portion
37of the revenues in the Highway Users Tax Account attributable to
38the increase in the motor vehicle fuel excise tax by seventeen cents
39($0.17) per gallon pursuant to subdivision (a) of Section 7360 of
P53   1the Revenue and Taxation Code, as adjusted pursuant to
2subdivision (c) of that section.

3
(b) The revenues from the increase in the vehicle registration
4fee pursuant to Section 9250.3 of the Vehicle Code.

5
(c) The revenues from the increase in the vehicle registration
6fee pursuant to Section 9250.6 of the Vehicle Code.

7
(d) The revenues deposited in the account pursuant to Section
8183.1 of the Streets and Highways Code.

9
(e) Any other revenues designated for the program.

10

begin insert2031.5.end insert  

Each fiscal year the annual Budget Act shall contain
11an appropriation from the Road Maintenance and Rehabilitation
12Account to the Controller for the costs of carrying out his or her
13duties pursuant to this chapter and to the California Transportation
14Commission for the costs of carrying out its duties pursuant to this
15chapter and Section 14526.7 of the Government Code.

16

begin insert2032.end insert  

(a) (1) After deducting the amounts appropriated in
17the annual Budget Act, as provided in Section 2031.5, two hundred
18million dollars ($200,000,000) of the remaining revenues deposited
19in the Road Maintenance and Rehabilitation Account shall be set
20aside annually for counties that have sought and received voter
21approval of taxes or that have imposed fees, including uniform
22developer fees as defined by subdivision (b) of Section 8879.67 of
23the Government Code, which taxes or fees are dedicated solely to
24transportation improvements. The Controller shall each month
25set aside one-twelfth of this amount, to accumulate a total of two
26hundred million dollars ($200,000,000) in each fiscal year.

27
(2) Notwithstanding Section 13340 of the Government Code,
28the funds available under this subdivision in each fiscal year are
29hereby continuously appropriated for allocation to each eligible
30county and each city in the county for road maintenance and
31rehabilitation purposes pursuant to Section 2033.

32
(b) (1) After deducting the amounts appropriated in the annual
33Budget Act pursuant to Section 2031.5 and the amount allocated
34in subdivision (a), beginning in the 2017-18 fiscal year, eighty
35million dollars ($80,000,000) of the remaining revenues shall be
36transferred annually to the State Highway Account for expenditure,
37upon appropriation by the Legislature, on the Active
38Transportation Program created pursuant to Chapter 8
39(commencing with Section 2380) of Division 3 to be allocated by
P54   1the California Transportation Commission pursuant to Section
22381.

3
(2) In addition to the funds transferred in paragraph (1), the
4department shall annually identify savings achieved through
5efficiencies implemented at the department. The department,
6through the annual budget process, shall propose, from the
7identified savings, an appropriation to be included in the annual
8Budget Act of up to seventy million dollars ($70,000,000), but not
9to exceed the total annual identified savings, from the State
10Highway Account for expenditure on the Active Transportation
11Program.

12
(c) After deducting the amounts appropriated in the annual
13Budget Act pursuant to Section 2031.5, the amount allocated in
14subdivision (a) and the amount transferred in paragraph (1) of
15subdivision (b), in the 2017-18, 2018-19, 2019-20, and 2020-21
16fiscal years, the sum of thirty million dollars ($30,000,000) in each
17fiscal year from the remaining revenues shall be transferred to the
18Advance Mitigation Fund in the State Transportation Fund created
19pursuant to Section 21207 of the Public Resources Code.

20
(d) After deducting the amounts appropriated in the annual
21Budget Act pursuant to Section 2031.5, the amount allocated in
22subdivision (a), and the amounts transferred in paragraph (1) of
23subdivision (b) and in subdivision (c), beginning in the 2017-18
24fiscal year and each fiscal year thereafter, and notwithstanding
25Section 13340 of the Government Code, there is hereby
26continuously appropriated to the California State University the
27sum of two million dollars ($2,000,000) from the remaining
28revenues for the purpose of conducting transportation research
29and transportation-related workforce education, training, and
30development. Prior to the start of each fiscal year, the chairs of
31the Assembly Committee on Transportation and the Senate
32Committee on Transportation and Housing shall confer and set
33out a recommended priority list of research components to be
34addressed in the upcoming fiscal year.

35
(e) Notwithstanding Section 13340 of the Government Code,
36the balance of the revenues deposited in the Road Maintenance
37and Rehabilitation Account are hereby continuously appropriated
38as follows:

P55   1
(1) Fifty percent for allocation to the department for
2maintenance of the state highway system or for purposes of the
3state highway operation and protection program.

4
(2) Fifty percent for apportionment to cities and counties by the
5Controller pursuant to the formula in clauses (i) and (ii) of
6subparagraph (C) of paragraph (3) of subdivision (a) of Section
72103 for the purposes authorized by this chapter.

8

begin insert2033.end insert  

(a) On or before January 1, 2017, the commission, in
9cooperation with the department, transportation planning agencies,
10county transportation commissions, and other local agencies, shall
11develop guidelines for the allocation of funds pursuant to
12subdivision (a) of Section 2032.

13
(b) The guidelines shall be the complete and full statement of
14the policy, standards, and criteria that the commission intends to
15use to determine how these funds will be allocated.

16
(c) The commission may amend the adopted guidelines after
17conducting at least one public hearing.

18

begin insert2034.end insert  

(a) (1) Prior to receiving an apportionment of funds
19under the program pursuant to paragraph (2) of subdivision (d)
20of Section 2032 from the Controller in a fiscal year, an eligible
21city or county shall submit to the commission a list of projects
22proposed to be funded with these funds pursuant to an adopted
23city or county budget. All projects proposed to receive funding
24shall be included in a city or county budget that is adopted by the
25applicable city council or county board of supervisors at a regular
26public meeting. The list of projects proposed to be funded with
27these funds shall include a description and the location of each
28proposed project, a proposed schedule for the project’s completion,
29and the estimated useful life of the improvement. The project list
30shall not limit the flexibility of an eligible city or county to fund
31projects in accordance with local needs and priorities so long as
32the projects are consistent with subdivision (b) of Section 2030.

33
(2) The commission shall report to the Controller the cities and
34counties that have submitted a list of projects as described in this
35subdivision and that are therefore eligible to receive an
36apportionment of funds under the program for the applicable fiscal
37year. The Controller, upon receipt of the report, shall apportion
38funds to eligible cities and counties.

39
(b) For each fiscal year, each city or county receiving an
40apportionment of funds shall, upon expending program funds,
P56   1submit documentation to the commission that includes a description
2and location of each completed project, the amount of funds
3expended on the project, the completion date, and the estimated
4useful life of the improvement.

5

begin insert2036.end insert  

(a) Cities and counties shall maintain their existing
6commitment of local funds for street, road, and highway purposes
7in order to remain eligible for an allocation or apportionment of
8funds pursuant to Section 2032.

9
(b) In order to receive an allocation or apportionment pursuant
10to Section 2032, the city or county shall annually expend from its
11general fund for street, road, and highway purposes an amount
12not less than the annual average of its expenditures from its general
13fund during the 2009-10, 2010-11, and 2011-12 fiscal years, as
14reported to the Controller pursuant to Section 2151. For purposes
15of this subdivision, in calculating a city’s or county’s annual
16general fund expenditures and its average general fund
17expenditures for the 2009-10, 2010-11, and 2011-12 fiscal years,
18any unrestricted funds that the city or county may expend at its
19discretion, including vehicle in-lieu tax revenues and revenues
20from fines and forfeitures, expended for street, road, and highway
21purposes shall be considered expenditures from the general fund.
22One-time allocations that have been expended for street and
23highway purposes, but which may not be available on an ongoing
24basis, including revenue provided under the Teeter Plan Bond
25Law of 1994 (Chapter 6.6 (commencing with Section 54773) of
26Part 1 of Division 2 of Title 5 of the Government Code), may not
27be considered when calculating a city’s or county’s annual general
28fund expenditures.

29
(c) For any city incorporated after July 1, 2009, the Controller
30shall calculate an annual average expenditure for the period
31between July 1, 2009, and December 31, 2015, inclusive, that the
32city was incorporated.

33
(d) For purposes of subdivision (b), the Controller may request
34fiscal data from cities and counties in addition to data provided
35pursuant to Section 2151, for the 2009-10, 2010-11, and 2011-12
36fiscal years. Each city and county shall furnish the data to the
37Controller not later than 120 days after receiving the request. The
38Controller may withhold payment to cities and counties that do
39not comply with the request for information or that provide
40incomplete data.

P57   1
(e) The Controller may perform audits to ensure compliance
2with subdivision (b) when deemed necessary. Any city or county
3that has not complied with subdivision (b) shall reimburse the
4state for the funds it received during that fiscal year. Any funds
5withheld or returned as a result of a failure to comply with
6subdivision (b) shall be reapportioned to the other counties and
7cities whose expenditures are in compliance.

8
(f) If a city or county fails to comply with the requirements of
9subdivision (b) in a particular fiscal year, the city or county may
10expend during that fiscal year and the following fiscal year a total
11amount that is not less than the total amount required to be
12expended for those fiscal years for purposes of complying with
13subdivision (b).

14

begin insert2037.end insert  

A city or county may spend its apportionment of funds
15under the program on transportation priorities other than those
16allowable pursuant to this chapter if the city’s or county’s average
17Pavement Condition Index meets or exceeds 80.

18

begin insert2038.end insert  

(a) The department and local agencies, as a condition
19of receiving funds from the program, shall adopt and implement
20a program designed to promote and advance construction
21employment and training opportunities through preapprenticeship
22opportunities, either by the public agency itself or through
23contractors engaged by the public agencies to do work funded in
24whole or in part by funds made available by the program.

25
(b) The department and local agencies, as a condition of
26receiving funds from the program, shall ensure the involvement
27of the California Conservation Corps and certified community
28conservation corps in the delivery of projects and services funded
29in whole or in part by funds made available by the program.

end insert
30begin insert

begin insertSEC. 25.end insert  

end insert

begin insertSection 2103.1 is added to the end insertbegin insertStreets and Highways
31Code
end insert
begin insert, to read:end insert

begin insert
32

begin insert2103.1.end insert  

(a) Notwithstanding Section 2103, the revenues
33transferred to the Highway Users Tax Account pursuant to Sections
348352.4, 8352.5, and 8352.6 of the Revenue and Taxation Code
35shall be distributed pursuant to the formula in paragraph (3) of
36subdivision (a) of Section 2103.

37
(b) Notwithstanding subdivision (b) of Section 2103, the portion
38of revenues in the Highway Users Tax Account attributable to the
39increase in the motor vehicle fuel excise tax by seventeen cents
40($0.17) per gallon pursuant to subdivision (a) of Section 7360 of
P58   1the Revenue and Taxation Code, as adjusted pursuant to
2subdivision (c) of that section, shall be transferred to the Road
3Maintenance and Rehabilitation Account pursuant to Section 2031.

4
(c) Notwithstanding subdivision (b) of Section 2103, the portion
5of revenues in the Highway Users Tax Account attributable to the
6increase in the diesel fuel excise tax by thirty cents ($0.30) per
7gallon pursuant to subdivision (b) of Section 60050 of the Revenue
8and Taxation Code, as adjusted pursuant to subdivision (c) of that
9section, shall be transferred to the Trade Corridors Improvement
10Fund pursuant to Section 2192.4.

end insert
11begin insert

begin insertSEC. 26.end insert  

end insert

begin insertSection 2192 of the end insertbegin insertStreets and Highways Codeend insertbegin insert is
12amended to read:end insert

13

2192.  

(a) begin insert(1)end insertbegin insertend insertThe Trade Corridors Improvement Fund, created
14pursuant to subdivision (c) of Section 8879.23 of the Government
15Code, is hereby continued in existence to receive revenues from
16begin insert stateend insert sources other than the Highway Safety, Traffic Reduction,
17Air Quality, and Port Security Bond Act of 2006.begin delete This chapter
18shall govern expenditure of those other revenues.end delete

begin insert

19
(2) Revenues apportioned to the state under Section 167 of Title
2023 of the United States Code from the national highway freight
21program, pursuant to the federal Fixing America’s Surface
22Transportation Act (“FAST Act,” Public Law 114-94) shall be
23allocated for projects approved pursuant to this chapter.

end insert
begin insert

24
(b) This chapter shall govern the expenditure of those state and
25federal revenues described in subdivision (a).

end insert
begin delete

26(b) The moneys in the fund from these other sources

end delete

27begin insert(c)end insertbegin insertend insertbegin insertThe funding described in subdivision (a)end insert shall be available
28upon appropriation for allocation by the California Transportation
29Commission for infrastructure improvements in this state on
30federally designated Trade Corridors of National and Regional
31Significance, on the Primary Freight Network, and along other
32corridors that have a high volume of freight movement, as
33determined by the commission. In determining the projects eligible
34for funding, the commission shall consult the Transportation
35Agency’s state freight plan as described in Section 13978.8 of the
36Governmentbegin delete Code, the State Air Resources Board’s Sustainable
37Freight Strategy adopted by Resolution 14-2,end delete
begin insert Codeend insert and the trade
38infrastructure and goods movement plan submitted to the
39commission by the Secretary of Transportation and the Secretary
40for Environmental Protection. The commission shall also consult
P59   1trade infrastructure and goods movement plans adopted by regional
2transportation planning agencies, adopted regional transportation
3plans required by state and federal law, and thebegin delete statewideend delete
4begin insert applicableend insert port master planbegin delete prepared by the California Marine and
5Intermodal Transportation System Advisory Council
6(Cal-MITSAC) pursuant to Section 1730 of the Harbors and
7Navigation Code,end delete
when determining eligible projects for funding.
8Eligible projects for these funds include, but are not limited to, all
9of the following:

10(1) Highway capacitybegin insert improvements, rail landside access
11improvements, landside freight accessend insert
improvementsbegin insert to airports,end insert
12 and operational improvements to more efficiently accommodate
13the movement of freight, particularly for ingress and egress to and
14from the state’s land ports ofbegin delete entryend deletebegin insert entry, rail terminals,end insert and
15seaports, including navigable inland waterways used to transport
16freight between seaports, land ports of entry, and airports, and to
17relieve traffic congestion along major trade or goods movement
18corridors.

19(2) Freight rail system improvements to enhance the ability to
20move goods from seaports, land ports of entry, and airports to
21warehousing and distribution centers throughout California,
22including projects that separate rail lines from highway or local
23road traffic, improve freight rail mobility through mountainous
24regions, relocate rail switching yards, and other projects that
25improve the efficiency and capacity of the rail freight system.

26(3) Projects to enhance the capacity and efficiency of ports.

27(4) Truck corridorbegin insert and capital and operationalend insert improvements,
28including dedicated truck facilities or truck toll facilities.

29(5) Borderbegin delete accessend deletebegin insert capital and operationalend insert improvements that
30enhance goods movement between California and Mexico and that
31maximize the state’s ability to accessbegin delete coordinated border
32infrastructureend delete
funds made available to the state by federal law.

33(6) Surface transportation and connector road improvements to
34effectively facilitate the movement of goods, particularly for
35ingress and egress to and from the state’s land ports of entry,
36airports, and seaports, to relieve traffic congestion along major
37trade or goods movement corridors.

begin delete

38(c) (1) The

end delete

39begin insert(d)end insertbegin insertend insertbegin insert(1)end insertbegin insertend insertbegin insertExcept as provided in paragraph (2), theend insert commission
40shall allocatebegin delete fundsend deletebegin insert the funding described in subdivision (a)end insert for
P60   1trade infrastructure improvementsbegin delete from the fundend delete consistent with
2Section 8879.52 of the Government Code and the Trade Corridors
3Improvement Fund (TCIF) Guidelines adopted by the commission
4on November 27, 2007, or as amended by the commission, and in
5a manner that (A) addresses the state’s most urgent needs, (B)
6balances the demands of various land ports of entry, seaports, and
7airports, (C) provides reasonable geographic balance between the
8state’s regions,begin delete andend delete (D) places emphasis on projects that improve
9trade corridor mobilitybegin insert and safetyend insert while reducing emissions of
10diesel particulate and other pollutantbegin delete emissions.end deletebegin insert emissions and
11reducing other negative community impacts, and (E) makes a
12significant contribution to the state’s economy.end insert

begin insert

13
(2) The commission shall allocate the federal freight funding,
14specifically, pursuant to the original TCIF Guidelines, as adopted
15by the commission on November 27, 2007, and in the manner
16described in (A) to (E), inclusive, of paragraph (1).

end insert
begin delete

17(2)

end delete

18begin insert(3)end insert In addition, the commission shall also consider the following
19factors when allocating these funds:

20(A) “Velocity,” which means the speed by which large cargo
21would travel from the land port of entry or seaport through the
22distribution system.

23(B) “Throughput,” which means the volume of cargo that would
24move from the land port of entry or seaport through the distribution
25system.

26(C) “Reliability,” which means a reasonably consistent and
27predictable amount of time for cargo to travel from one point to
28another on any given day or at any given time in California.

29(D) “Congestion reduction,” which means the reduction in
30recurrent daily hours of delay to be achieved.

31begin insert

begin insertSEC. 27.end insert  

end insert

begin insertSection 2192.1 of the end insertbegin insertStreets and Highways Codeend insertbegin insert is
32amended to read:end insert

33

2192.1.  

(a) To the extent moneys from the Greenhouse Gas
34Reduction Fund, attributable to the auction or sale of allowances
35as part of a market-based compliance mechanism relative to
36reduction of greenhouse gas emissions, are transferred to the Trade
37Corridors Improvement Fund, projects funded with those moneys
38shall be subject to all of the requirements of existing law applicable
39to the expenditure of moneys appropriated from the Greenhouse
P61   1Gas Reduction Fund, including, but not limited to,begin delete bothend deletebegin insert allend insert of the
2following:

3(1) Projects shall further the regulatory purposes of the
4California Global Warming Solutions Act of 2006 (Division 25.5
5(commencing with Section 38500) of the Health and Safety Code),
6including reducing emissions from greenhouse gases in the state,
7directing public and private investment toward disadvantaged
8communities, increasing the diversity of energy sources, or creating
9opportunities for businesses, public agencies, nonprofits, and other
10community institutions to participate in and benefit from statewide
11efforts to reduce emissions of greenhouse gases.

12(2) Projects shall be consistent with the guidance developed by
13the State Air Resources Board pursuant to Section 39715 of the
14Health and Safety Code.

begin insert

15
(3) Projects shall be consistent with the required benefits to
16disadvantaged communities pursuant to Section 39713 of the
17Health and Safety Code.

end insert

18(b) All allocations of funds made by the commission pursuant
19to this section shall be made in a manner consistent with the criteria
20expressed in Section 39712 of the Health and Safety Code and
21with the investment plan developed by the Department of Finance
22pursuant to Section 39716 of the Health and Safety Code.

begin insert

23
(c) For purposes of this section, “disadvantaged community”
24means a community with any of the following characteristics:

end insert
begin insert

25
(1) An area with a median household income less than 80
26percent of the statewide median household income based on the
27most current census tract-level data from the American Community
28Survey.

end insert
begin insert

29
(2) An area identified by the California Environmental
30Protection Agency pursuant to Section 39711 of the Health and
31Safety Code.

end insert
begin insert

32
(3) An area where at least 75 percent of public school students
33are eligible to receive free or reduced-price meals under the
34National School Lunch Program.

end insert
35begin insert

begin insertSEC. 28.end insert  

end insert

begin insertSection 2192.2 of the end insertbegin insertStreets and Highways Codeend insertbegin insert is
36amended to read:end insert

37

2192.2.  

The commission shall allocate funds made available
38by this chapter to projects that have identified and committed
39supplemental funding from appropriate local, federal, or private
40sources. The commission shall determine the appropriate amount
P62   1of supplemental funding each project should have to be eligible
2for moneysbegin delete from the fundend delete based on a project-by-project review
3and an assessment of the project’s benefit to the state and the
4program.begin delete Except for border accessend deletebegin insert Fundedend insert improvementsbegin delete described
5in paragraph (5) of subdivision (b) of Section 2192, improvements
6funded with moneys from the fundend delete
shall have supplemental funding
7that is at least equal to the amount of the contributionbegin delete from the
8fund.end delete
begin insert under this chapter.end insert The commission may give priority for
9funding to projects with higher levels of committed supplemental
10funding.

11begin insert

begin insertSEC. 29.end insert  

end insert

begin insertSection 2192.4 is added to the end insertbegin insertStreets and Highways
12Code
end insert
begin insert, to read:end insert

begin insert
13

begin insert2192.4.end insert  

Notwithstanding subdivision (b) of Section 2103, the
14portion of the revenues in the Highway Users Tax Account
15attributable to the increase in the diesel fuel excise tax by thirty
16cents ($0.30) per gallon pursuant to subdivision (b) of Section
1760050 of the Revenue and Taxation Code, as adjusted pursuant
18to subdivision (c) of that section, shall be deposited in the Trade
19Corridors Improvement Fund.

end insert
20begin insert

begin insertSEC. 30.end insert  

end insert

begin insertSection 9250.3 is added to the end insertbegin insertVehicle Codeend insertbegin insert, to read:end insert

begin insert
21

begin insert9250.3.end insert  

(a) In addition to any other fees specified in this code
22or the Revenue and Taxation Code, commencing 120 days after
23the effective date of the act adding this section, a registration fee
24of thirty-eight dollars ($38) shall be paid to the department for
25registration or renewal of registration of every vehicle subject to
26registration under this code, except those vehicles that are
27expressly exempted under this code from payment of registration
28fees.

29
(b) Beginning July 1, 2019, and every third year thereafter, the
30Department of Motor Vehicles shall adjust the fee imposed under
31this section for inflation in an amount equal to the change in the
32California Consumer Price Index for the prior three-year period,
33as calculated by the Department of Finance, with amounts equal
34to or greater than fifty cents ($0.50) rounded to the next highest
35whole dollar.

36
(c) Revenues from the fee, after the deduction of the
37department’s administrative costs related to this section, shall be
38deposited in the Road Maintenance and Rehabilitation Account
39created pursuant to Section 2031 of the Streets and Highways
40Code.

end insert
P63   1begin insert

begin insertSEC. 31.end insert  

end insert

begin insertSection 9250.6 is added to the end insertbegin insertVehicle Codeend insertbegin insert, to read:end insert

begin insert
2

begin insert9250.6.end insert  

(a) In addition to any other fees specified in this code,
3or the Revenue and Taxation Code, commencing 120 days after
4the effective date of the act adding this section, a registration fee
5of one hundred and sixty-five dollars ($165) shall be paid to the
6department for registration or renewal of registration of every
7zero-emission motor vehicle subject to registration under this code,
8except those motor vehicles that are expressly exempted under this
9code from payment of registration fees.

10
(b) Beginning July 1, 2019, and every third year thereafter, the
11Department of Motor Vehicles shall adjust the fee imposed under
12this section for inflation in an amount equal to the change in the
13California Consumer Price Index for the prior three-year period,
14 as calculated by the Department of Finance, with amounts equal
15to or greater than fifty cents ($0.50) rounded to the next highest
16whole dollar.

17
(c) Revenues from the fee, after deduction of the department’s
18administrative costs related to this section, shall be deposited in
19the Road Maintenance and Rehabilitation Account created
20pursuant to Section 2031 of the Streets and Highways Code.

21
(d) This section does not apply to a commercial motor vehicle
22subject to Section 9400.1.

23
(e) The registration fee required pursuant to this section does
24not apply to the initial registration after the purchase of a new
25zero-emission motor vehicle.

26
(f) For purposes of this section, “zero-emission motor vehicle”
27means a motor vehicle as described in subdivisions (c) and (d) of
28Section 44258 of the Health and Safety Code, or any other motor
29vehicle that is able to operate on any fuel other than gasoline or
30diesel fuel.

end insert
31begin insert

begin insertSEC. 32.end insert  

end insert

begin insertSection 9400.5 is added to the end insertbegin insertVehicle Codeend insertbegin insert, to read:end insert

begin insert
32

begin insert9400.5.end insert  

(a) Notwithstanding Sections 9400.1, 9400.4, and
3342205 of this code, Sections 16773 and 16965 of the Government
34Code, Section 2103 of the Streets and Highways Code, or any
35other law, weight fee revenues shall only be transferred consistent
36with the schedule provided in subdivision (b) from the State
37Highway Account to the Transportation Debt Service Fund, the
38Transportation Bond Direct Payment Account, or any other fund
39or account for the purpose of payment of the debt service on
P64   1transportation general obligation bonds and shall not be loaned
2to the General Fund.

3
(b) (1) The transfer of weight fee revenues, after deduction of
4collection costs, from the State Highway Account pursuant to
5subdivision (a) shall not exceed:

6
(A) 80 percent of the total weight fees in the 2017-18 fiscal
7year.

8
(B) 60 percent of the total weight fees in the 2018-19 fiscal
9year.

10
(C) 40 percent of the total weight fees in the 2019-20 fiscal
11year.

12
(D) 20 percent of the total weight fees in the 2020-2021 fiscal
13year.

14
(2) No weight fees, after deduction of collection costs, shall be
15transferred from the State Highway Account after the 2020-21
16fiscal year.

end insert
17begin insert

begin insertSEC. 33.end insert  

end insert
begin insert

This act is an urgency statute necessary for the
18immediate preservation of the public peace, health, or safety within
19the meaning of Article IV of the Constitution and shall go into
20immediate effect. The facts constituting the necessity are:

end insert
begin insert

21
In order to provide additional funding for road maintenance
22and rehabilitation purposes as quickly as possible, it is necessary
23for this act to take effect immediately.

end insert

All matter omitted in this version of the bill appears in the bill as amended in the Senate, April 21, 2016. (JR11)



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