BILL NUMBER: SBX1 1	AMENDED
	BILL TEXT

	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

INTRODUCED BY   Senator Beall
    (   Principal coauthor:   Assembly Member
  Frazier   ) 
   (Coauthors: Senators Allen, Hall, Hertzberg, McGuire, and Mendoza)

                        JUNE 22, 2015

    An 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.   An 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. 


	LEGISLATIVE COUNSEL'S DIGEST


   SB 1, as amended, Beall.  Transportation funding:
environmental mitigation: oversight.   Transportation
funding.  
   (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.  
   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.
 
   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.  
   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.  
   (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.  
   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.  
   (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.  
   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.  
   This bill would require the department to update the Highway
Design Manual to incorporate the "complete streets" design concept by
January 1, 2017.  
   (4) Existing law provides for loans of revenues from various
transportation funds and accounts to the General Fund, with various
repayment dates specified.  
   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.  
   (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.
 
   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.  
   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.  
   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.  
   (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.
 
   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.  
   (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.
 
   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.  
   (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.  
   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.  
   (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.  
   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).  
   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. 

   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.  
   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.  
   (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.  
   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.  
   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.  
   (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.  
   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. 
   (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. 

   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.  
   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.  
   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.  
   (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.  
   This bill would delete the January 1, 2017, repeal date, thereby
extending these provisions indefinitely.  
   (14) This bill would declare that it is to take effect immediately
as an urgency statute.  
   (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.  
   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. 

   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.  
   (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.
 
   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.  
   (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.  
   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.  
   (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.  
   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. 

   (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.
 
   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.  
   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. 

   (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.
 
   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.  
   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.  
   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.  
   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.  
   (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.  
   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.
 
   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.  
   (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.  
   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.  
   (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.  
   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.  
   (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.  
   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.  
   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.  
   (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.  
   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.
 
   (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.  
   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.  
   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. 

   (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.

   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.  
   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.  
   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.  
   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.
 
   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. 

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

   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. 

   (16) This bill would declare that it is to take effect immediately
as an urgency statute. 
   Vote: 2/3. Appropriation: yes. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

   SECTION 1.    The Legislature finds and declares all
of the following:  
   (a) Over the next 10 years, the state faces a $59 billion
shortfall to adequately maintain the existing state highway system in
order to keep it in a basic state of good repair.  
   (b) Similarly, cities and counties face a $78 billion shortfall
over the next decade to adequately maintain the existing network of
local streets and roads.  
   (c) Statewide taxes and fees dedicated to the maintenance of the
system have not been increased in more than 20 years, with those
revenues losing more than 55 percent of their purchasing power, while
costs to maintain the system have steadily increased and much of the
underlying infrastructure has aged past its expected useful life.
 
   (d) California motorists are spending $17 billion annually in
extra maintenance and car repair bills, which is more than $700 per
driver, due to the state's poorly maintained roads.  
   (e) Failing to act now to address this growing problem means that
more drastic measures will be required to maintain our system in the
future, essentially passing the burden on to future generations
instead of doing our job today.  
   (f) A funding program will help address a portion of the
maintenance backlog on the state's road system and will stop the
growth of the problem.  
   (g) Modestly increasing various fees can spread the cost of road
repairs broadly to all users and beneficiaries of the road network
without overburdening any one group. 
   (h) Improving the condition of the state's road system will have a
positive impact on the economy as it lowers the transportation costs
of doing business, reduces congestion impacts for employees, and
protects property values in the state.  
   (i) The federal government estimates that increased spending on
infrastructure creates more than 13,000 jobs per $1 billion spent.
 
   (j) Well-maintained roads benefit all users, not just drivers, as
roads are used for all modes of transport, whether motor vehicles,
transit, bicycles, or pedestrians.  
   (k) Well-maintained roads additionally provide significant health
benefits and prevent injuries and death due to crashes caused by
poorly maintained infrastructure.  
   (l  ) A comprehensive, reasonable transportation funding
package will do all of the following: 
   (1) Ensure these transportation needs are addressed.  
   (2) Fairly distribute the economic impact of increased funding.
 
   (3) Restore the gas tax rate previously reduced by the State Board
of Equalization pursuant to the gas tax swap.  
   (4) Direct increased revenue to the state's highest transportation
needs. 
   SEC. 2.    Section 13975 of the   Government
Code   is   amended to read: 
   13975.  There is in the state government the Transportation
Agency. The agency consists of the Department of the California
Highway Patrol, the  California Transportation Commission,
the  Department of Motor Vehicles, the Department of
Transportation, the High-Speed Rail Authority, and the Board of Pilot
Commissioners for the Bays of San Francisco, San Pablo, and Suisun.
   SEC. 3.    Section 14033 is added to the  
Government Code   , to read:  
   14033.  On or before January 1, 2017, the department shall update
the Highway Design Manual to incorporate the "complete streets"
design concept. 
   SEC. 4.    Part 5.1 (commencing with Section 14460)
is added to Division 3 of Title 2 of the   Government Code
  , to read:  

      PART 5.1.  OFFICE OF THE TRANSPORTATION INSPECTOR GENERAL


   14460.  (a) There is hereby created in state government the
independent Office of the Transportation Inspector General, which
shall not be a subdivision of any other governmental entity, to
ensure that the Department of Transportation, the High-Speed Rail
Authority, the Department of the California Highway Patrol, the
Department of Motor Vehicles, the State Air Resources Board, and all
other state agencies expending state transportation funds are
operating efficiently, effectively, and in compliance with applicable
federal and state laws.
   (b) The Governor shall appoint, subject to confirmation by the
Senate, the Transportation Inspector General to a six-year term. The
Transportation Inspector General may not be removed from office
during that term, except for good cause. A finding of good cause may
include substantial neglect of duty, gross misconduct, or conviction
of a crime. The reasons for removal of the Transportation Inspector
General shall be stated in writing and shall include the basis for
removal. The writing shall be sent to the Secretary of the Senate and
the Chief Clerk of the Assembly at the time of the removal and shall
be deemed to be a public document.
   14461.  The Transportation Inspector General shall review
policies, practices, and procedures and conduct audits and
investigations of activities involving state transportation funds in
consultation with all affected state agencies. Specifically, the
Transportation Inspector General's duties and responsibilities shall
include, but not be limited to, all of the following:
   (a) To examine the operating practices of all state agencies
expending state transportation funds to identify fraud and waste,
opportunities for efficiencies, and opportunities to improve the data
used to determine appropriate project resource allocations.
   (b) To identify best practices in the delivery of transportation
projects and develop policies or recommend proposed legislation
enabling state agencies to adopt these practices when practicable.
   (c) To provide objective analysis of and, when possible, offer
solutions to concerns raised by the public or generated within
agencies involving the state's transportation infrastructure and
project delivery methods.
   (d) To conduct, supervise, and coordinate audits and
investigations relating to the programs and operations of all state
transportation agencies with state-funded transportation projects.
   (e) To recommend policies promoting economy and efficiency in the
administration of programs and operations of all state agencies with
state-funded transportation projects.
   (f) To ensure that the Secretary of Transportation and the
Legislature are fully and currently informed concerning fraud or
other serious abuses or deficiencies relating to the expenditure of
funds or administration of programs and operations.
   14462.  The Transportation Inspector General shall report at least
annually to the Governor and Legislature with a summary of his or
her findings, investigations, and audits. The summary shall be posted
on the Transportation Inspector General's Internet Web site and
shall otherwise be made available to the public upon its release to
the Governor and Legislature. The summary shall include, but need not
be limited to, significant problems discovered by the Transportation
Inspector General and whether recommendations of the Transportation
Inspector General relative to investigations and audits have been
implemented by the affected agencies. The report shall be submitted
to the Legislature in compliance with Section 9795. 
   SEC. 5.    Section 14500 of the   Government
Code   is amended to read: 
   14500.  There is in  the Transportation Agency 
 state government  a California Transportation Commission.
 The commission shall act in an independent oversight role. 

   SEC. 6.    Section 14526.5 of the  
Government Code  is amended to read: 
   14526.5.  (a) Based on the asset management plan prepared and
approved pursuant to Section 14526.4, the department shall prepare a
state highway operation and protection program for the expenditure of
transportation funds for major capital improvements that are
necessary to preserve and protect the state highway system. Projects
included in the program shall be limited to  capital
 improvements relative to maintenance, safety, 
rehabilitation, and  rehabilitation  
operation  of state highways and bridges that do not add a new
traffic lane to the system.
   (b) The program shall include projects that are expected to be
advertised prior to July 1 of the year following submission of the
program, but which have not yet been funded. The program shall
include those projects for which construction is to begin within four
fiscal years, starting July 1 of the year following the year the
program is submitted.
   (c) (1)    The department, at a minimum, shall
specify, for each project in the state highway operation and
protection program, the capital and support  budget, as well
as a projected delivery date,   budget  for each of
the following project components: 
   (1) Completion of project 
    (A)     Project  approval and
environmental documents. 
   (2) Preparation of plans, 
    (B)     Plans,  specifications, and
estimates. 
   (3) Acquisition of rights-of-way, including, but not limited to,
support activities.  
   (C) Rights-of-way.  
   (D) Construction.  
   (2) The department shall specify, for each project in the state
highway operation and protection program, a projected delivery date
for each of the following components: 
   (A) Environmental document completion.  
   (B) Plans, specifications, and estimate completion.  
   (C) Right-of-way certification.  
   (4) 
    (D)  Start of construction.
   (d) The  program shall be submitted  
department shall submit its proposed program  to the commission
not later than January 31 of each even-numbered year. Prior to
submitting  the plan, the   its proposed
program, the  department shall make a draft of its proposed
program available to transportation planning agencies for review and
comment and shall include the comments in its submittal to the
commission.  The department shall provide the commission with
detailed information for all programmed projects, including, but not
limited to, cost, scope, schedule, and performance metrics as
determined by the commission. 
   (e) The commission  may   shall  review
the  proposed  program relative to its overall adequacy,
consistency with the asset management plan prepared and approved
pursuant to Section 14526.4 and funding priorities established in
Section 167 of the Streets and Highways Code, the level of annual
funding needed to implement the program, and the impact of those
expenditures on the state transportation improvement program. The
commission shall adopt the program and submit it to the Legislature
and the Governor not later than April 1 of each even-numbered year.
The commission may decline to adopt the program if the commission
determines that the program is not sufficiently consistent with the
asset management plan prepared and approved pursuant to Section
14526.4. 
   (f) As part of the commission's review of the program required
pursuant to subdivision (a), the commission shall hold at least one
hearing in northern California and one hearing in southern California
regarding the proposed program.  
   (f) 
    (g)  Expenditures for these projects shall not be
subject to Sections 188 and 188.8 of the Streets and Highways Code.

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

   SEC. 7.    Section 14526.7 is added to the  
Government Code   , to read:  
   14526.7.  (a) On and after February 1, 2017, an allocation by the
commission of all capital and support costs for each project in the
state highway operation and protection program shall be required.
   (b) For a project that experiences increases in capital or support
costs above the amounts in the commission's allocation pursuant to
subdivision (a), a supplemental project allocation request shall be
submitted by the department to the commission for approval.
   (c) The commission shall establish guidelines to provide
exceptions to the requirement of subdivision (b) that the commission
determines are necessary to ensure that projects are not
unnecessarily delayed. 
   SEC. 8.    Section 14534.1 of the  
Government Code   is repealed.  
   14534.1.  Notwithstanding Section 12850.6 or subdivision (b) of
Section 12800, as added to this code by the Governor's Reorganization
Plan No. 2 of 2012 during the 2011-12 Regular Session, the
commission shall retain independent authority to perform those duties
and functions prescribed to it under any provision of law. 

   SEC. 9.    Section 16321 is added to the  
Government Code  , to read:  
   16321.  (a) Notwithstanding any other law, on or before September
1, 2016, the Department of Finance shall compute the amount of
outstanding loans made from the State Highway Account, the Motor
Vehicle Fuel Account, the Highway Users Tax Account, and the Motor
Vehicle Account to the General Fund. The department shall prepare a
loan repayment schedule, pursuant to which the outstanding loans
shall be repaid, as follows:
   (1) On or before June 30, 2017, 50 percent of the outstanding loan
amounts.
   (2) On or before June 30, 2018, the remainder of the outstanding
loan amounts.
   (b) Notwithstanding any other law, as the loans are repaid
pursuant to this section, the repaid funds shall be transferred in
the following manner:
   (1) Fifty percent to cities and counties pursuant to clauses (i)
and (ii) of subparagraph (C) of paragraph (3) of subdivision (a) of
Section 2103 of the Streets and Highways Code.
   (2) Fifty percent to the department for maintenance of the state
highway system and for purposes of the state highway operation and
protection program.
   (c) Funds for loan repayments pursuant to this section are hereby
appropriated from the Budget Stabilization Account pursuant to
subclause (II) of clause (ii) of subparagraph (B) of paragraph (1) of
subdivision (c) of Section 20 of Article XVI of the California
Constitution. 
   SEC. 10.    Section 16965 of the  
Government Code   is amended to read: 
   16965.  (a) (1) The Transportation Debt Service Fund is hereby
created in the State Treasury. Moneys in the fund shall be dedicated
to all of the following purposes:
   (A) Payment of debt service with respect to designated bonds, as
defined in subdivision (c) of Section 16773, and as further provided
in paragraph (3) and subdivision (b).
   (B) To reimburse the General Fund for debt service with respect to
bonds.
   (C) To redeem or retire bonds, pursuant to Section 16774, maturing
in a subsequent fiscal year.
   (2) The bonds eligible under subparagraph (B) or (C) of paragraph
(1) include bonds issued pursuant to the  Clean Air and
Transportation Improvement Act of 1990 (Part 11.5 (commencing with
Section 99600) of Division 10 of the Public Utilities Code), the
 Passenger Rail and Clean Air Bond Act of 1990 (Chapter 17
(commencing with Section 2701) of Division 3 of the Streets and
Highways Code), the Seismic Retrofit Bond Act of 1996 (Chapter 12.48
(commencing with Section 8879) of Division 1 of Title 2), and the
Safe, Reliable High-Speed Passenger Train Bond Act for the 21st
Century (Chapter 20 (commencing with Section 2704) of Division 3 of
the Streets and Highways Code), and nondesignated bonds under
Proposition 1B, as defined in subdivision (c) of Section 16773.
   (3) (A) The Transportation Bond Direct Payment Account is hereby
created in the State Treasury, as a subaccount within the
Transportation Debt Service Fund, for the purpose of directly paying
the debt service, as defined in paragraph (4), of designated bonds of
Proposition 1B, as defined in subdivision (c) of Section 16773.
Notwithstanding Section 13340, moneys in the Transportation Bond
Direct Payment Account are continuously appropriated for payment of
debt service with respect to designated bonds as provided in
subdivision (c) of Section 16773. So long as any designated bonds
remain outstanding, the moneys in the Transportation Bond Direct
Payment Account may not be used for any other purpose, and may not be
borrowed by or available for transfer to the General Fund pursuant
to Section 16310 or any similar law, or to the General Cash Revolving
Fund pursuant to Section 16381 or any similar law.
   (B) Once the Treasurer makes a certification that payment of debt
service with respect to all designated bonds has been paid or
provided for, any remaining moneys in the Transportation Bond Direct
Payment Account shall be transferred back to the Transportation Debt
Service Fund.
   (C) The moneys in the Transportation Bond Direct Payment Account
shall be invested in the Surplus Money Investment Fund, and all
investment earnings shall accrue to the account.
   (D) The Controller may establish subaccounts within the
Transportation Bond Direct Payment Account as may be required by the
resolution, indenture, or other documents governing any designated
bonds.
   (4) For purposes of this subdivision and subdivision (b), and
subdivision (c) of Section 16773, "debt service" means payment of all
of the following costs and expenses with respect to any designated
bond:
   (A) The principal of and interest on the bonds.
   (B) Amounts payable as the result of tender on any bonds, as
described in clause (iv) of subparagraph (B) of paragraph (1) of
subdivision (d) of Section 16731.
   (C) Amounts payable under any contractual obligation of the state
to repay advances and pay interest thereon under a credit enhancement
or liquidity agreement as described in clause (iv) of subparagraph
(B) of paragraph (1) of subdivision (d) of Section 16731.
   (D) Any amount owed by the state to a counterparty after any
offset for payments owed to the state on any hedging contract as
described in subparagraph (A) of paragraph (2) of subdivision (d) of
Section 16731.
   (b) From the moneys transferred to the fund pursuant to paragraph
(2) or (3) of subdivision (c) of Section 9400.4 of the Vehicle Code,
there shall first be deposited into the Transportation Bond Direct
Payment Account in each month sufficient funds to equal the amount
designated in a certificate submitted by the Treasurer to the
Controller and the Director of Finance at the start of each fiscal
year, and as may be modified by the Treasurer thereafter upon
issuance of any new issue of designated bonds or upon change in
circumstances that requires such a modification. This certificate
shall be calculated by the Treasurer to identify, for each month, the
amount necessary to fund all of the debt service with respect to all
designated bonds. This calculation shall be done in a manner
provided in the resolution, indenture, or other documents governing
the designated bonds. In the event that transfers to the
Transportation Bond Direct Payment Account in any month are less than
the amounts required in the Treasurer's certificate, the shortfall
shall carry over to be part of the required payment in the succeeding
month or months.
   (c) The state hereby covenants with the holders from time to time
of any designated bonds that it will not alter, amend, or restrict
the provisions of subdivision (c) of Section 16773 of the Government
Code, or Sections 9400, 9400.1, 9400.4, and 42205 of the Vehicle
Code, which provide directly or indirectly for the transfer of weight
fees to the Transportation Debt Service Fund or the Transportation
Bond Direct Payment Account, or subdivisions (a) and (b) of this
section, or reduce the rate of imposition of vehicle weight fees
under Sections 9400 and 9400.1 of the Vehicle Code as they existed on
the date of the first issuance of any designated bonds, if that
alteration, amendment, restriction, or reduction would result in
projected weight fees for the next fiscal year determined by the
Director of Finance being less than two times the maximum annual debt
service with respect to all outstanding designated bonds, as such
calculation is determined pursuant to the resolution, indenture, or
other documents governing the designated bonds. The state may include
this covenant in the resolution, indenture, or other documents
governing the designated bonds.
   (d) Once the required monthly deposit, including makeup of any
shortfalls from any prior month, has been made pursuant to
subdivision (b), from moneys transferred to the fund pursuant to
paragraph (2) or (3) of subdivision (c) of Section 9400.4 of the
Vehicle Code, or pursuant to Section 16965.1 or 63048.67, the
Controller shall transfer as an expenditure reduction to the General
Fund any amount necessary to offset the cost of current year debt
service payments made from the General Fund with respect to any bonds
issued pursuant to Proposition 192 (1996) and three-quarters of the
amount of current year debt service payments made from the General
Fund with respect to any nondesignated bonds, as defined in
subdivision (c) of Section 16773, issued pursuant to Proposition 1B
(2006). In the alternative, these funds may also be used to redeem or
retire the applicable bonds, pursuant to Section 16774, maturing in
a subsequent fiscal year as directed by the Director of Finance.

   (e) From moneys transferred to the fund pursuant to Section 183.1
of the Streets and Highways Code, the Controller shall transfer as an
expenditure reduction to the General Fund any amount necessary to
offset the cost of current year debt service payments made from the
General Fund with respect to any bonds issued pursuant to Proposition
116 (1990). In the alternative, these funds may also be used to
redeem or retire the applicable bonds, pursuant to Section 16774,
maturing in a subsequent fiscal year as directed by the Director of
Finance.  
   (f) 
    (e)  Once the required monthly deposit, including makeup
of any shortfalls from any prior month, has been made pursuant to
subdivision (b), from moneys transferred to the fund pursuant to
paragraph (2) or (3) of subdivision (c) of Section 9400.4 of the
Vehicle Code, or pursuant to Section 16965.1 or 63048.67, the
Controller shall transfer as an expenditure reduction to the General
Fund any amount necessary to offset the eligible cost of current year
debt service payments made from the General Fund with respect to any
bonds issued pursuant to Proposition 108 (1990) and Proposition 1A
(2008), and one-quarter of the amount of current year debt service
payments made from the General Fund with respect to any nondesignated
bonds, as defined in subdivision (c) of Section 16773, issued
pursuant to Proposition 1B (2006). The Department of Finance shall
notify the Controller by July 30 of every year of the percentage of
debt service that is expected to be paid in that fiscal year with
respect to bond-funded projects that qualify as eligible guideway
projects consistent with the requirements applicable to the
expenditure of revenues under Article XIX of the California
Constitution, and the Controller shall make payments only for those
eligible projects. In the alternative, these funds may also be used
to redeem or retire the applicable bonds, pursuant to Section 16774,
maturing in a subsequent fiscal year as directed by the Director of
Finance. 
   (g) 
    (f)  On or before the second business day following the
date on which transfers are made to the Transportation Debt Service
Fund, and after the required monthly deposits for that month,
including makeup of any shortfalls from any prior month, have been
made to the Transportation Bond Direct Payment Account, the
Controller shall transfer the funds designated for reimbursement of
bond debt service with respect to nondesignated bonds, as defined in
subdivision (c) of Section 16773, and other bonds identified in
subdivisions  (d), (e), and (f)   (d) and (e)
 in that month from the fund to the General Fund pursuant to
this section.
   SEC. 11.    Section 39719 of the   Health
and Safety Code   is amended to read: 
   39719.  (a) The Legislature shall appropriate the annual proceeds
of the fund for the purpose of reducing greenhouse gas emissions in
this state in accordance with the requirements of Section 39712.
   (b) To carry out a portion of the requirements of subdivision (a),
annual proceeds are continuously appropriated for the following:
   (1) Beginning in the  2015-16   2016-17 
fiscal year, and notwithstanding Section 13340 of the Government
Code,  35   50  percent of annual proceeds
are continuously appropriated, without regard to fiscal years, for
transit, affordable housing, and sustainable communities programs as
following:
   (A)  Ten   Twenty  percent of the annual
proceeds of the fund is hereby continuously appropriated to the
Transportation Agency for the Transit and Intercity Rail Capital
Program created by Part 2 (commencing with Section 75220) of Division
44 of the Public Resources Code.
   (B)  Five   Ten    percent of
the annual proceeds of the fund is hereby continuously appropriated
to the Low Carbon Transit Operations Program created by Part 3
(commencing with Section 75230) of Division 44 of the Public
Resources Code.  Funds   Moneys  shall be
allocated by the Controller, according to requirements of the
program, and pursuant to the distribution formula in subdivision (b)
or (c) of                                              Section 99312
of, and Sections 99313 and 99314 of, the Public Utilities Code.
   (C) Twenty percent of the annual proceeds of the fund is hereby
continuously appropriated to the Strategic Growth Council for the
Affordable Housing and Sustainable Communities Program created by
Part 1 (commencing with Section 75200) of Division 44 of the Public
Resources Code. Of the amount appropriated in this subparagraph, no
less than 10 percent of the annual  proceeds,  
proceeds  shall be expended for affordable housing, consistent
with the provisions of that program.
   (2) Beginning in the 2015-16 fiscal year, notwithstanding Section
13340 of the Government Code, 25 percent of the annual proceeds of
the fund is hereby continuously appropriated to the High-Speed Rail
Authority for the following components of the initial operating
segment and Phase I Blended System as described in the 2012 business
plan adopted pursuant to Section 185033 of the Public Utilities Code:

   (A) Acquisition and construction costs of the project.
   (B) Environmental review and design costs of the project.
   (C) Other capital costs of the project.
   (D) Repayment of any loans made to the authority to fund the
project.
   (c) In determining the amount of annual proceeds of the fund for
purposes of the calculation in subdivision (b), the funds subject to
Section 39719.1 shall not be included.
   SEC. 12.    Section 21080.37 of the   Public
Resources Code   is amended to read: 
   21080.37.  (a) This division does not apply to a project or an
activity to repair, maintain, or make minor alterations to an
existing roadway if all of the following conditions are met: 

   (1) The project is carried out by a city or county with a
population of less than 100,000 persons to improve public safety.
 
   (2) 
    (1)  (A) The project does not cross a waterway.
   (B) For purposes of this paragraph, "waterway" means a bay,
estuary, lake, pond, river, slough, or a perennial, intermittent, or
ephemeral stream, lake, or estuarine-marine shoreline. 
   (3) 
    (2)  The project involves negligible or no expansion of
an existing use beyond that existing at the time of the lead agency's
determination. 
   (4) The roadway is not a state roadway.  
   (5) 
    (3)  (A) The site of the project does not contain
wetlands or riparian areas and does not have significant value as a
wildlife habitat, and the project does not harm any species protected
by the federal Endangered Species Act of 1973 (16 U.S.C. Sec. 1531
et seq.), the Native Plant Protection Act (Chapter 10 (commencing
with Section 1900) of Division 2 of the Fish and Game Code), or the
California Endangered Species Act (Chapter 1.5 (commencing with
Section 2050) of Division 3 of the Fish and Game Code), and the
project does not cause the destruction or removal of any species
protected by a local ordinance.
   (B) For the purposes of this paragraph:
   (i) "Riparian areas" mean those areas transitional between
terrestrial and aquatic ecosystems and that are distinguished by
gradients in biophysical conditions, ecological processes, and biota.
A riparian area is an area through which surface and subsurface
hydrology connect waterbodies with their adjacent uplands. A riparian
area includes those portions of terrestrial ecosystems that
significantly influence exchanges of energy and matter with aquatic
ecosystems. A riparian area is adjacent to perennial, intermittent,
and ephemeral streams, lakes, and estuarine-marine shorelines.
   (ii) "Significant value as a wildlife habitat" includes wildlife
habitat of national, statewide, regional, or local importance;
habitat for species protected by the federal Endangered Species Act
of 1973 (16 U.S.C. Sec. 1531, et seq.), the California Endangered
Species Act (Chapter 1.5 (commencing with Section 2050) of Division 3
of the Fish and Game Code), or the Native Plant Protection Act
(Chapter 10 (commencing with Section 1900) of Division 2 of the Fish
and Game Code); habitat identified as candidate, fully protected,
sensitive, or species of special status by local, state, or federal
agencies; or habitat essential to the movement of resident or
migratory wildlife.
   (iii) "Wetlands" has the same meaning as in the United States Fish
and Wildlife Service Manual, Part 660 FW 2 (June 21, 1993).
   (iv) "Wildlife habitat" means the ecological communities upon
which wild animals, birds, plants, fish, amphibians, and
invertebrates depend for their conservation and protection. 
   (6) 
    (4)  The project does not impact cultural resources.

   (7) 
   (5)  The roadway does not affect scenic resources, as
provided pursuant to subdivision (c) of Section 21084.
   (b) Prior to determining that a project is exempt pursuant to this
section, the lead agency shall do both of the following:
   (1) Include measures in the project to mitigate potential
vehicular traffic and safety impacts and bicycle and pedestrian
safety impacts.
   (2) Hold a noticed public hearing on the project to hear and
respond to public comments. The hearing on the project may be
conducted with another noticed lead agency public hearing.
Publication of the notice shall be no fewer times than required by
Section 6061 of the Government Code, by the public agency in a
newspaper of general circulation in the area.
   (c) For purposes of this section, "roadway" means a roadway as
defined pursuant to Section 530 of the Vehicle Code and the
previously graded and maintained shoulder that is within a roadway
right-of-way of no more than five feet from the edge of the roadway.

   (d) (1) If a state agency determines that a project is not subject
to this division pursuant to this section and it approves or
determines to carry out that project, it shall file a notice with the
Office of Planning and Research in the manner specified in
subdivisions (b) and (c) of Section 21108.  
   (d) Whenever 
    (2)     If  a local agency determines
that a project is not subject to this division pursuant to this
 section,   section  and it approves or
determines to carry out that project,  the local agency
  it  shall file a notice with the Office of
Planning and Research, and with the county clerk in the county in
which the project will be located in the manner specified in
subdivisions (b) and (c) of Section 21152. 
   (e) This section shall remain in effect only until January 1,
2020, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2020, deletes or extends
that date. 
   SEC. 13.    Division 13.6 (commencing with Section
21200) is added to the   Public Resources Code   ,
to read:  

      DIVISION 13.6.  ADVANCE MITIGATION PROGRAM ACT




      CHAPTER 1.  GENERAL


   21200.  This division shall be known, and may be cited, as the
Advance Mitigation Program Act.
   21201.  (a) The purpose of this division is to improve the success
and effectiveness of actions implemented to mitigate the natural
resource impacts of future transportation projects by establishing
the means to implement those actions well before the transportation
projects are constructed. The advance identification and
implementation of mitigation actions also will streamline the
delivery of transportation projects by anticipating mitigation
requirements for planned transportation projects and avoiding or
reducing delays associated with environmental permitting. By
identifying regional or statewide conservation priorities and by
anticipating the impacts of planned transportation projects on a
regional or statewide basis, mitigation actions can be designed to
protect and restore California's most valuable natural resources and
also facilitate environmental compliance for planned transportation
projects on a regional scale.
   (b) This division is not intended to create a new environmental
permitting or regulatory program or to modify existing environmental
laws or regulations, nor is it expected that all mitigation
requirements will be addressed for planned transportation projects.
Instead, it is intended to provide a methodology with which to
anticipate and fulfill the requirements of existing state and federal
environmental laws that protect fish, wildlife, plant species, and
other natural resources more efficiently and effectively.
   21202.  The Legislature finds and declares all of the following:
   (a) The minimization and mitigation of environmental impacts is
ordinarily handled on a project-by-project basis, usually near the
end of a project's timeline and often without guidance regarding
regional or statewide conservation priorities.
   (b) The cost of critical transportation projects often escalates
because of permitting delays that occur when appropriate conservation
and mitigation measures cannot easily be identified and because the
cost of these measures often increases between the time a project is
planned and funded and the time mitigation is implemented.
   (c) Addressing conservation and mitigation needs early in a
project's timeline, during the project design and development phase,
can reduce costs, allow natural resources conservation to be
integrated with project siting and design, and result in the
establishment of more valuable and productive habitat mitigation.
   (d) When the Department of Transportation is able to anticipate
the mitigation needs for planned transportation projects, it can meet
those needs in a more timely and cost-effective way by using advance
mitigation planning.
   (e) Working with state and federal resource protection agencies,
the department can identify, conserve, and, where appropriate,
restore lands for mitigation of numerous projects early in the
projects' timelines, thereby allowing public funds to stretch further
by acquiring habitat at a lower cost and avoiding environmental
permitting delays.
   (f) Advance mitigation can provide an effective means of
facilitating delivery of transportation projects while ensuring more
effective natural resource conservation.
   (g) Advance mitigation is needed to direct mitigation funding for
transportation projects to agreed-upon conservation priorities and to
the creation of habitat reserves and recreation areas that enhance
the sustainability of human and natural systems by protecting or
restoring connectivity of natural communities and the delivery of
ecosystem services.
   (h) Advance mitigation can facilitate the implementation of
climate change adaptation strategies both for ecosystems and
California's economy.
   (i) Advance mitigation can enable the state to protect, restore,
and recover its natural resources as it strengthens and improves its
transportation systems.
   21203.  The Legislature intends to do all of the following by
enacting this division:
   (a) Facilitate delivery of transportation projects while ensuring
more effective natural resource conservation.
   (b) Develop effective strategies to improve the state's ability to
meet mounting demands for transportation improvements and to
maximize conservation and other public benefits.
   (c) Achieve conservation objectives of statewide and regional
importance by coordinating local, state, and federally funded natural
resource conservation efforts with mitigation actions required for
impacts from transportation projects.
   (d) Create administrative, governance, and financial incentives
and mechanisms necessary to ensure that measures required to minimize
or mitigate impacts from transportation projects will serve to
achieve regional or statewide natural resource conservation
objectives.
      CHAPTER 2.  DEFINITIONS


   21204.  For purposes of this division, the following terms have
the following meanings:
   (a) "Acquire" and "acquisition" mean, with respect to land or a
waterway, acquisition of fee title or purchase of a conservation
easement, that protects conservation and mitigation values on the
land or waterway in perpetuity.
   (b) "Advance mitigation" means mitigation implemented before, and
in anticipation of, environmental effects of planned transportation
projects.
   (c) "Commission" means the California Transportation Commission.
   (d) "Department" means the Department of Transportation.
   (e) "Transportation agency" means the department, the High-Speed
Rail Authority, a metropolitan planning organization, a regional
transportation planning agency, or another public agency that
implements transportation projects.
   (f) "Transportation project" means a transportation capital
improvement project.
   (g) "Planned transportation project" means a transportation
project that a transportation agency has concluded is reasonably
likely to be constructed within 20 years and that has been identified
to the agency for purposes of this division. A planned
transportation project may include, but is not limited to, a
transportation project that has been proposed for approval or that
has been approved.
   (h) "Program" means the Advance Mitigation Program implemented
pursuant to this division.
   (i) "Regulatory agency" means a state or federal natural resource
protection agency with regulatory authority over planned
transportation projects. A regulatory agency includes, but is not
limited to, the Natural Resources Agency, the Department of Fish and
Wildlife, California regional water quality control boards, the
United States Fish and Wildlife Service, the National Marine
Fisheries Service, the United States Environmental Protection Agency,
and the United States Army Corps of Engineers.
      CHAPTER 3.  ADVANCE MITIGATION PROGRAM


   21205.  (a) The Advance Mitigation Program is hereby created in
the department to accelerate project delivery and improve
environmental outcomes of environmental mitigation for planned
transportation projects.
   (b) The program may utilize mitigation instruments, including, but
not limited to, mitigation banks, in lieu of fee programs, and
conservation easements as defined in Section 815.1 of the Civil Code.

   (c) The department shall track all implemented advance mitigation
projects to use as credits for environmental mitigation for
state-sponsored transportation projects.
   (d) The department may use advance mitigation credits to fulfill
mitigation requirements of any environmental law for a transportation
project eligible for the State Transportation Improvement Program or
the State Highway Operation and Protection Program.
   21206.  No later than February 1, 2017, the department shall
establish an interagency transportation advance mitigation steering
committee consisting of the department and appropriate state and
federal regulatory agencies to support the program so that advance
mitigation can be used as required mitigation for planned
transportation projects and can provide improved environmental
outcomes. The committee shall advise the department of opportunities
to carry out advance mitigation projects, provide the best available
science, and actively participate in mitigation instrument reviews
and approvals. The committee shall seek to develop streamlining
opportunities, including those related to landscape scale mitigation
planning and alignment of federal and state regulations and
procedures related to mitigation requirements and implementation. The
committee shall also provide input on crediting, using, and tracking
of advance mitigation investments.
   21207.  The Advance Mitigation Fund is hereby created in the State
Transportation Fund as a revolving fund. Notwithstanding Section
13340 of the Government Code, the fund shall be continuously
appropriated without regard to fiscal years. The moneys in the fund
shall be programmed by the commission for the planning and
implementation of advance mitigation projects consistent with the
purposes of this chapter. After the transfer of moneys to the fund
for four fiscal years pursuant to subdivision (c) of Section 2032 of
the Streets and Highways Code, commencing in the 2017-18 fiscal year,
the program is intended to be self-sustaining. Advance expenditures
from the fund shall later be reimbursed from project funding
available at the time a planned transportation project is
constructed. A maximum of 5 percent of available funds may be used
for administrative purposes. 
   SEC. 14.    Section 99312.1 of the   Public
Utilities Code   is amended to read: 
   99312.1.   (a)    Revenues transferred to the
Public Transportation Account pursuant to Sections 6051.8 and 6201.8
of the Revenue and Taxation Code are hereby continuously appropriated
to the Controller for allocation as follows: 
   (a) 
    (1)  Fifty percent for allocation to transportation
planning agencies, county transportation commissions, and the San
Diego Metropolitan Transit Development Board pursuant to Section
99314. 
   (b) 
    (2)  Fifty percent for allocation to transportation
agencies, county transportation commissions, and the San Diego
Metropolitan Transit Development Board for purposes of Section 99313.

    For 
    (b)     For  purposes of this chapter,
the revenues allocated pursuant to this section shall be subject to
the same requirements as revenues allocated pursuant to subdivisions
(b) and (c), as applicable, of Section 99312. 
   (c) The revenues transferred to the Public Transportation Account
that are attributable to the increase in the sales and use tax on
diesel fuel pursuant to subdivision (b) of Section 6051.8 of the
Revenue and Taxation Code, as adjusted pursuant to subdivision (c) of
that section, and subdivision (b) of Section 6201.8 of the Revenue
and Taxation Code, as adjusted pursuant to subdivision (c) of that
section, upon allocation pursuant to Sections 99313 and 99314, shall
only be expended on the following:  
   (1) Transit capital projects or services to maintain or repair a
transit operator's existing transit vehicle fleet or existing transit
facilities, including rehabilitation or modernization of existing
vehicles or facilities.  
   (2) The design, acquisition, and construction of new vehicles or
facilities that improve existing transit services.  
   (3) Transit services that complement local efforts for repair and
improvement of local transportation infrastructure.  
   (d) (1) Prior to receiving an apportionment of funds pursuant to
subdivision (c) from the Controller in a fiscal year, a recipient
transit agency shall submit to the Department of Transportation a
list of projects proposed to be funded with these funds. The list of
projects proposed to be funded with these funds shall include a
description and location of each proposed project, a proposed
schedule for the project's completion, and the estimated useful life
of the improvement. The project list shall not limit the flexibility
of a recipient transit agency to fund projects in accordance with
local needs and priorities so long as the projects are consistent
with subdivision (c).  
   (2) The department shall report to the Controller the recipient
transit agencies that have submitted a list of projects as described
in this subdivision and that are therefore eligible to receive an
apportionment of funds for the applicable fiscal year. The
Controller, upon receipt of the report, shall apportion funds
pursuant to Sections 99313 and 99314.  
   (e) For each fiscal year, each recipient transit agency receiving
an apportionment of funds pursuant to subdivision (c) shall, upon
expending those funds, submit documentation to the department that
includes a description and location of each completed project, the
amount of funds expended on the project, the completion date, and the
estimated useful life of the improvement.  
   (f) The audit of transit operator finances required pursuant to
Section 99245 shall verify that the revenues identified in
subdivision (c) have been expended in conformance with these specific
requirements and all other generally applicable requirements. 
   SEC. 15.   Section 6051.8 of the   Revenue
and Taxation Code   is amended to read: 
   6051.8.  (a) Except as provided by Section 6357.3, in addition to
the taxes imposed by this part, for the privilege of selling tangible
personal property at retail a tax is hereby imposed upon all
retailers at the rate of 1.75 percent of the gross receipts of any
retailer from the sale of all diesel  fuel, as defined in
Section 60022, sold at retail in this state on and after the
operative date of this subdivision.   fuel. 

   (b) Notwithstanding subdivision (a), for the 2011-12 fiscal year
only, the rate referenced in subdivision (a) shall be 1.87 percent.
 
   (c) Notwithstanding subdivision (a), for the 2012-13 fiscal year
only, the rate referenced in subdivision (a) shall be 2.17 percent.
 
   (d) Notwithstanding subdivision (a), for the 2013-14 fiscal year
only, the rate referenced in subdivision (a) shall be 1.94 percent.
 
   (b) Except as provided by Section 6357.3, in addition to the taxes
imposed by this part and by subdivision (a), for the privilege of
selling tangible personal property at retail a tax is hereby imposed
upon all retailers at the rate of 3.5 percent of the gross receipts
of any retailer from the sale of all diesel fuel, as defined in
Section 60022, sold at retail in this state. The tax imposed under
this subdivision shall be imposed on and after the first day of the
first calendar quarter that occurs 90 days after the effective date
of the act adding this subdivision.  
   (c) Beginning July 1, 2019, and every third year thereafter, the
State Board of Equalization shall recompute the rates of the taxes
imposed by this section. That computation shall be made as follows:
 
   (1) The Department of Finance shall transmit to the State Board of
Equalization the percentage change in the California Consumer Price
Index for all items from November of three calendar years prior to
November of the prior calendar year, no later than January 31, 2019,
and January 31 of every third year thereafter.  
   (2) The State Board of Equalization shall do all of the following:
 
   (A) Compute an inflation adjustment factor by adding 100 percent
to the percentage change figure that is furnished pursuant to
paragraph (1) and dividing the result by 100.  
   (B) Multiply the preceding tax rate per gallon by the inflation
adjustment factor determined in subparagraph (A) and round off the
resulting product to the nearest tenth of a cent. 
   (C) Make its determination of the new rate no later than March 1
of the same year as the effective date of the new rate. 
   (e) 
    (d)  Notwithstanding subdivision (b) of Section 7102,
all of the revenues, less refunds, collected pursuant to this section
shall be estimated by the State Board of Equalization, with the
concurrence of the Department of Finance, and transferred quarterly
to the Public Transportation Account in the State Transportation Fund
for allocation pursuant to Section 99312.1 of the Public Utilities
Code. 
   (f) Subdivisions (a) to (e), inclusive, shall become operative on
July 1, 2011. 
   SEC. 16.    Section 6201.8 of the   Revenue
and Taxation Code   is amended to read: 
   6201.8.  (a) Except as provided by Section 6357.3, in addition to
the taxes imposed by this part, an excise tax is hereby imposed on
the storage, use, or other consumption in this state of diesel fuel,
as defined in Section 60022, at the rate of 1.75 percent of the sales
price of the diesel  fuel on and after the operative date of
this subdivision.   fuel.  
   (b) Notwithstanding subdivision (a), for the 2011-12 fiscal year
only, the rate referenced in subdivision (a) shall be 1.87 percent.
 
   (c) Notwithstanding subdivision (a), for the 2012-13 fiscal year
only, the rate referenced in subdivision (a) shall be 2.17 percent.
 
   (d) Notwithstanding subdivision (a), for the 2013-14 fiscal year
only, the rate referenced in subdivision (a) shall be 1.94 percent.
 
   (b) Except as provided by Section 6357.3, in addition to the taxes
imposed by this part and by subdivision (a), an excise tax is hereby
imposed on the storage, use, or other consumption in this state of
diesel fuel, as defined in Section 60022, at the rate of 3.5 percent
of the sales price of the diesel fuel. The tax imposed under this
subdivision shall be imposed on and after the first day of the first
calendar quarter that occurs 90 days after the effective date of the
act adding this subdivision.  
   (c) Beginning July 1, 2019, and every third year thereafter, the
State Board of Equalization shall recompute the
                     rates of the taxes imposed by this section. That
computation shall be made as follows:  
   (1) The Department of Finance shall transmit to the State Board of
Equalization the percentage change in the California Consumer Price
Index for all items from November of three calendar years prior to
November of the prior calendar year, no later than January 31, 2019,
and January 31 of every third year thereafter.  
   (2) The State Board of Equalization shall do all of the following:
 
   (A) Compute an inflation adjustment factor by adding 100 percent
to the percentage change figure that is furnished pursuant to
paragraph (1) and dividing the result by 100.  
   (B) Multiply the preceding tax rate per gallon by the inflation
adjustment factor determined in subparagraph (A) and round off the
resulting product to the nearest tenth of a cent.  
   (C) Make its determination of the new rate no later than March 1
of the same year as the effective date of the new rate. 

   (e) 
    (d)  Notwithstanding subdivision (b) of Section 7102,
all of the revenues, less refunds, collected pursuant to this section
shall be estimated by the State Board of Equalization, with the
concurrence of the Department of Finance, and transferred quarterly
to the Public Transportation Account in the State Transportation Fund
for allocation pursuant to Section 99312.1 of the Public Utilities
Code. 
   (f) Subdivisions (a) to (e), inclusive, shall become operative on
July 1, 2011. 
   SEC. 17.    Section 7360 of the   Revenue
and Taxation Code   is amended to read: 
   7360.  (a) (1)  (A)    A tax of eighteen cents
($0.18) is hereby imposed upon each gallon of fuel subject to the tax
in Sections 7362, 7363, and 7364. 
   (B) In addition to the tax imposed pursuant to subparagraph (A),
on and after the first day of the first calendar quarter that occurs
90 days after the effective date of the act adding this subparagraph,
a tax of seventeen cents ($0.17) is hereby imposed upon each gallon
of fuel, other than aviation gasoline, subject to the tax in Sections
7362, 7363, and 7364. 
   (2) If the federal fuel tax is reduced below the rate of nine
cents ($0.09) per gallon and federal financial allocations to this
state for highway and exclusive public mass transit guideway purposes
are reduced or eliminated correspondingly, the tax rate imposed by
 subparagraph (A) of  paragraph (1), on and after the date
of the reduction, shall be recalculated by an amount so that the
combined state rate under  subparagraph (A) of  paragraph
(1) and the federal tax rate per gallon equal twenty-seven cents
($0.27).
   (3) If any person or entity is exempt or partially exempt from the
federal fuel tax at the time of a reduction, the person or entity
shall continue to be so exempt under this section.
   (b)  (1)    On and after July 1,
2010, in addition to the tax imposed by subdivision (a), a tax is
hereby imposed upon each gallon of motor vehicle fuel, other than
aviation gasoline, subject to the tax in Sections 7362, 7363, and
7364 in an amount equal to seventeen and three-tenths cents ($0.173)
per gallon. 
   (2) For the 2011-12 fiscal year and each fiscal year thereafter,
the board shall, on or before March 1 of the fiscal year immediately
preceding the applicable fiscal year, adjust the rate in paragraph
(1) in that manner as to generate an amount of revenue that will
equal the amount of revenue loss attributable to the exemption
provided by Section 6357.7, based on estimates made by the board, and
that rate shall be effective during the state's next fiscal year.
 
   (3) In order to maintain revenue neutrality for each year,
beginning with the rate adjustment on or before March 1, 2012, the
adjustment under paragraph (2) shall also take into account the
extent to which the actual amount of revenues derived pursuant to
this subdivision and, as applicable, Section 7361.1, the revenue loss
attributable to the exemption provided by Section 6357.7 resulted in
a net revenue gain or loss for the fiscal year ending prior to the
rate adjustment date on or before March 1.  
   (4) The intent of paragraphs (2) and (3) is to ensure that the act
adding this subdivision and Section 6357.7 does not produce a net
revenue gain in state taxes.  
   (c) Beginning July 1, 2019, and every third year thereafter, the
State Board of Equalization shall recompute the rates of the taxes
imposed by this section. That computation shall be made as follows:
 
   (1) The Department of Finance shall transmit to the State Board of
Equalization the percentage change in the California Consumer Price
Index for all items from November of three calendar years prior to
November of the prior calendar year, no later than January 31, 2019,
and January 31 of every third year thereafter.  
   (2) The State Board of Equalization shall do all of the following:
 
   (A) Compute an inflation adjustment factor by adding 100 percent
to the percentage change figure that is furnished pursuant to
paragraph (1) and dividing the result by 100.  
   (B) Multiply the preceding tax rate per gallon by the inflation
adjustment factor determined in subparagraph (A) and round off the
resulting product to the nearest tenth of a cent.  
   (C) Make its determination of the new rate no later than March 1
of the same year as the effective date of the new rate. 
   SEC. 18.    Section 8352.4 of the   Revenue
and Taxation Code   is amended to read: 
   8352.4.  (a) Subject to Sections 8352 and 8352.1, and except as
otherwise provided in subdivision (b), there shall be transferred
from the money deposited to the credit of the Motor Vehicle Fuel
Account to the Harbors and Watercraft Revolving Fund, for expenditure
in accordance with Division 1 (commencing with Section 30) of the
Harbors and Navigation Code, the sum of six million six hundred
thousand dollars ($6,600,000) per annum, representing the amount of
money in the Motor Vehicle Fuel Account attributable to taxes imposed
on distributions of motor vehicle fuel used or usable in propelling
vessels. The actual amount shall be calculated using the annual
reports of registered boats prepared by the Department of Motor
Vehicles for the United States Coast Guard and the formula and method
of the December 1972 report prepared for this purpose and submitted
to the Legislature on December 26, 1972, by the Director of
Transportation. If the amount transferred during each fiscal year is
in excess of the calculated amount, the excess shall be retransferred
from the Harbors and Watercraft Revolving Fund to the Motor Vehicle
Fuel Account. If the amount transferred is less than the amount
calculated, the difference shall be transferred from the Motor
Vehicle Fuel Account to the Harbors and Watercraft Revolving Fund. No
adjustment shall be made if the computed difference is less than
fifty thousand dollars ($50,000), and the amount shall be adjusted to
reflect any temporary or permanent increase or decrease that may be
made in the rate under the Motor Vehicle Fuel Tax Law. Payments
pursuant to this section shall be made prior to payments pursuant to
Section 8352.2.
   (b) Commencing July 1,  2012,   2016, 
the revenues attributable to the taxes imposed pursuant to
subdivision (b) of Section 7360 and Section 7361.1 and otherwise to
be deposited in the Harbors and Watercraft Revolving Fund pursuant to
subdivision (a) shall instead be transferred to the  General
Fund. The revenues attributable to the taxes imposed  
Highway Users Tax Account for distribution  pursuant to 
subdivision (b) of   Section  
7360 and Section 7361.1 that were deposited in   Section
2103.1 of  the  Harbors   Streets 
and  Watercraft Revolving Fund in the 2010-11 and 2011-12
fiscal years shall be transferred to the General Fund.  
Highways Code. 
   SEC.   19.    Section 8352.5 of the 
 Revenue and Taxation Code   is amended to read: 
   8352.5.  (a) (1) Subject to Sections 8352 and 8352.1, and except
as otherwise provided in subdivision (b), there shall be transferred
from the money deposited to the credit of the Motor Vehicle Fuel
Account to the Department of Food and Agriculture Fund, during the
second quarter of each fiscal year, an amount equal to the estimate
contained in the most recent report prepared pursuant to this
section.
   (2) The amounts are not subject to Section 6357 with respect to
the collection of sales and use taxes thereon, and represent the
portion of receipts in the Motor Vehicle Fuel Account during a
calendar year that were attributable to agricultural off-highway use
of motor vehicle fuel which is subject to refund pursuant to Section
8101, less gross refunds allowed by the Controller during the fiscal
year ending June  30th   30  following the
calendar year to persons entitled to refunds for agricultural
off-highway use pursuant to Section 8101. Payments pursuant to this
section shall be made prior to payments pursuant to Section 8352.2.
   (b) Commencing July 1,  2012,   2016, 
the revenues attributable to the taxes imposed pursuant to
subdivision (b) of Section 7360 and Section 7361.1 and otherwise to
be deposited in the Department of Food and Agriculture Fund pursuant
to subdivision (a) shall instead be transferred to the 
General Fund. The revenues attributable to the taxes imposed
  Highway Users Tax Account for distribution 
pursuant to  subdivision (b) of   Section
  7360 and Section 7361.1 that were deposited in the
Department   Section 2103.1  of  Food and
Agriculture Fund in  the  2010-11  
Streets  and  2011-12 fiscal years shall be transferred
to the General Fund.   Highways Code. 
   (c) On or before September 30, 2012, and on or before September 30
of each even-numbered year thereafter, the Director of
Transportation and the Director of Food and Agriculture shall jointly
prepare, or cause to be prepared, a report setting forth the current
estimate of the amount of money in the Motor Vehicle Fuel Account
attributable to agricultural off-highway use of motor vehicle fuel,
which is subject to refund pursuant to Section 8101 less gross
refunds allowed by the Controller to persons entitled to refunds for
agricultural off-highway use pursuant to Section 8101; and they shall
submit a copy of the report to the Legislature.
   SEC. 20.    Section 8352.6 of the   Revenue
and Taxation Code   is am   ended to read: 
   8352.6.  (a) (1) Subject to Section 8352.1, and except as
otherwise provided in paragraphs (2) and (3), on the first day of
every month, there shall be transferred from moneys deposited to the
credit of the Motor Vehicle Fuel Account to the Off-Highway Vehicle
Trust Fund created by Section 38225 of the Vehicle Code an amount
attributable to taxes imposed upon distributions of motor vehicle
fuel used in the operation of motor vehicles off highway and for
which a refund has not been claimed. Transfers made pursuant to this
section shall be made prior to transfers pursuant to Section 8352.2.
   (2) Commencing July 1,  2012,   2016, 
the revenues attributable to the taxes imposed pursuant to
subdivision (b) of Section 7360 and Section 7361.1 and otherwise to
be deposited in the Off-Highway Vehicle Trust Fund pursuant to
paragraph (1) shall instead be transferred to the  General
Fund. The revenues attributable to the taxes imposed  
Highway Users Tax Account for distribution  pursuant to 
subdivision (b) of   Section  
7360 and Section 7361.1 that were deposited in   Section
2103.1 of  the  Off-Highway Vehicle Trust Fund in the
2010-11   Streets  and  2011-12 fiscal
years shall be transferred to the General Fund.  
Highways Code. 
   (3) The Controller shall withhold eight hundred thirty-three
thousand dollars ($833,000) from the monthly transfer to the
Off-Highway Vehicle Trust Fund pursuant to paragraph (1), and
transfer that amount to the General Fund.
   (b) The amount transferred to the Off-Highway Vehicle Trust Fund
pursuant to paragraph (1) of subdivision (a), as a percentage of the
Motor Vehicle Fuel Account, shall be equal to the percentage
transferred in the 2006-07 fiscal year. Every five years, starting in
the 2013-14 fiscal year, the percentage transferred may be adjusted
by the Department of Transportation in cooperation with the
Department of Parks and Recreation and the Department of Motor
Vehicles. Adjustments shall be based on, but not limited to, the
changes in the following factors since the 2006-07 fiscal year or the
last adjustment, whichever is more recent:
   (1) The number of vehicles registered as off-highway motor
vehicles as required by Division 16.5 (commencing with Section 38000)
of the Vehicle Code.
   (2) The number of registered street-legal vehicles that are
anticipated to be used off highway, including four-wheel drive
vehicles, all-wheel drive vehicles, and dual-sport motorcycles.
   (3) Attendance at the state vehicular recreation areas.
   (4) Off-highway recreation use on federal lands as indicated by
the United States Forest Service's National Visitor Use Monitoring
and the United States Bureau of Land Management's Recreation
Management Information System.
   (c) It is the intent of the Legislature that transfers from the
Motor Vehicle Fuel Account to the Off-Highway Vehicle Trust Fund
should reflect the full range of motorized vehicle use off highway
for both motorized recreation and motorized off-road access to other
recreation opportunities. Therefore, the Legislature finds that the
fuel tax baseline established in subdivision (b), attributable to
off-highway estimates of use as of the 2006-07 fiscal year, accounts
for the three categories of vehicles that have been found over the
years to be users of fuel for off-highway motorized recreation or
motorized access to nonmotorized recreational pursuits. These three
categories are registered off-highway motorized vehicles, registered
street-legal motorized vehicles used off highway, and unregistered
off-highway motorized vehicles.
   (d) It is the intent of the Legislature that the off-highway motor
vehicle recreational use to be determined by the Department of
Transportation pursuant to paragraph (2) of subdivision (b) be that
usage by vehicles subject to registration under Division 3
(commencing with Section 4000) of the Vehicle Code, for recreation or
the pursuit of recreation on surfaces where the use of vehicles
registered under Division 16.5 (commencing with Section 38000) of the
Vehicle Code may occur.
   (e) In the 2014-15 fiscal year, the Department of Transportation,
in consultation with the Department of Parks and Recreation and the
Department of Motor Vehicles, shall undertake a study to determine
the appropriate adjustment to the amount transferred pursuant to
subdivision (b) and to update the estimate of the amount attributable
to taxes imposed upon distributions of motor vehicle fuel used in
the operation of motor vehicles off highway and for which a refund
has not been claimed. The department shall provide a copy of this
study to the Legislature no later than January 1, 2016.
   SEC. 21.    Section 60050 of the   Revenue
and Taxation Code   is amended to read: 
   60050.  (a) (1) A tax of eighteen   thirteen
 cents  ($0.18)   ($0.13)  is hereby
imposed upon each gallon of diesel fuel subject to the tax in
Sections 60051, 60052, and 60058.
   (2) If the federal fuel tax is reduced below the rate of fifteen
cents ($0.15) per gallon and federal financial allocations to this
state for highway and exclusive public mass transit guideway purposes
are reduced or eliminated correspondingly, the tax rate imposed by
paragraph  (1), including any reduction or adjustment
pursuant to subdivision (b), on and after the date of the reduction,
  (1)  shall be increased by an amount so that the
combined state rate under paragraph (1) and the federal tax rate per
gallon equal what it would have been in the absence of the federal
reduction.
   (3) If any person or entity is exempt or partially exempt from the
federal fuel tax at the time of a reduction, the person or entity
shall continue to be exempt under this section. 
   (b) (1) On July 1, 2011, the tax rate specified in paragraph (1)
of subdivision (a) shall be reduced to thirteen cents ($0.13) and
every July 1 thereafter shall be adjusted pursuant to paragraphs (2)
and (3).  
   (2) For the 2012-13 fiscal year and each fiscal year thereafter,
the board shall, on or before March 1 of the fiscal year immediately
preceding the applicable fiscal year, adjust the rate reduction in
paragraph (1) in that manner as to result in a revenue loss
attributable to paragraph (1) that will equal the amount of revenue
gain attributable to Sections 6051.8 and 6201.8, based on estimates
made by the board, and that rate shall be effective during the state'
s next fiscal year.  
   (3) In order to maintain revenue neutrality for each year,
beginning with the rate adjustment on or before March 1, 2013, the
adjustment under paragraph (2) shall take into account the extent to
which the actual amount of revenues derived pursuant to Sections
6051.8 and 6201.8 and the revenue loss attributable to this
subdivision resulted in a net revenue gain or loss for the fiscal
year ending prior to the rate adjustment date on or before March 1.
 
   (4) The intent of paragraphs (2) and (3) is to ensure that the act
adding this subdivision and Sections 6051.8 and 6201.8 does not
produce a net revenue gain in state taxes.  
   (b) In addition to the tax imposed pursuant to subdivision (a), on
and after the first day of the first calendar quarter that occurs 90
days after the effective date of the act amending this subdivision
in the 2015 First Extraordinary Session, an additional tax of thirty
cents ($0.30) is hereby imposed upon each gallon of diesel fuel
subject to the tax in Sections 60051, 60052, and 60058.  
   (c) Beginning July 1, 2019, and every third year thereafter, the
State Board of Equalization shall recompute the rates of the taxes
imposed by this section. That computation shall be made as follows:
 
   (1) The Department of Finance shall transmit to the State Board of
Equalization the percentage change in the California Consumer Price
Index for all items from November of three calendar years prior to
November of the prior calendar year, no later than January 31, 2019,
and January 31 of every third year thereafter.  
   (2) The State Board of Equalization shall do all of the following:
 
   (A) Compute an inflation adjustment factor by adding 100 percent
to the percentage change figure that is furnished pursuant to
paragraph (1) and dividing the result by 100.  
   (B) Multiply the preceding tax rate per gallon by the inflation
adjustment factor determined in subparagraph (A) and round off the
resulting product to the nearest tenth of a cent.  
   (C) Make its determination of the new rate no later than March 1
of the same year as the effective date of the new rate. 
   SEC. 22.    Section 183.1 of the  Streets
and Highways Code   is amended to read: 
   183.1.   (a)    
Notwithstanding subdivision (a) of Section 182 or any other provision
of law,   Except as otherwise provided in Section
54237.7 of the Government Code,  money deposited into the
account that is not subject to Article XIX of the California
Constitution, including, but not limited to, money that is derived
from the sale of documents, charges for miscellaneous services to the
public, condemnation deposits fund investments, rental of state
property, or any other miscellaneous uses of property or money,
 may be used for any transportation purpose authorized by
statute, upon appropriation by the Legislature or, after transfer to
another fund, upon appropriation by the Legislature from that fund.
  shall be deposited in the Road Maintenance and
Rehabilitation Account created pursuant to Section 2031. 

   (b) Commencing with the 2013-14 fiscal year, and not later than
November 1 of each fiscal year thereafter, based on prior year
financial statements, the Controller shall transfer the funds
identified in subdivision (a) for the prior fiscal year from the
State Highway Account to the Transportation Debt Service Fund in the
State Transportation Fund, and those funds are continuously
appropriated for the purposes specified for the Transportation Debt
Service Fund. 
   SEC. 23.    Section 820.1 of the   Streets
and Highways Code   is amended to read: 
   820.1.  (a) The State of California consents to the jurisdiction
of the federal courts with regard to the compliance, discharge, or
enforcement of the responsibilities assumed by the department
pursuant to Section 326 of, and subsection (a) of Section 327 of,
Title 23 of the United States Code.
   (b) In any action brought pursuant to the federal laws described
in subdivision (a), no immunity from suit may be asserted by the
department pursuant to the Eleventh Amendment to the United States
Constitution, and any immunity is hereby waived.
   (c) The department shall not delegate any of its responsibilities
assumed pursuant to the federal laws described in subdivision (a) to
any political subdivision of the state or its instrumentalities.

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

   (1) A comparative analysis of the environmental review process
under the National Environmental Policy Act (Chapter 55 (commencing
with Section 4321) of Title 42 of the United States Code) for the 30
projects, excluding those projects categorically excluded from
environmental review, undertaken immediately preceding the enactment
of this section that involved the Federal Highway Administration and
the environmental review process for all projects, excluding those
projects categorically excluded from environmental review, undertaken
following the enactment of this section that did not involve the
Federal Highway Administration. This analysis shall include
department- and local agency-sponsored projects, and shall address
the following:  
   (A) For each project included in the analysis, the environmental
review process under the National Environmental Policy Act, including
which state and federal agencies reviewed the environmental
documents and the amount of time the documents were reviewed by each
agency, shall be described.  
   (B) The points in the environmental review process under the
National Environmental Policy Act when project delays occurred and
the nature of the delays.  
   (C) The time saved in the environmental review process for
projects undertaken following the enactment of this section in
comparison to the review process for projects undertaken prior to the
enactment of this section, and the points in the review process when
time was saved.  
   (D) The circumstances when the Federal Highway Administration
hindered and facilitated project delivery.  
   (2) All financial costs incurred by the department to assume the
responsibilities pursuant to Section 326 of, and subsection (a) of
Section 327 of, Title 23 of the United States Code, including, but
not limited to, the following:  
   (A) Personnel to conduct and review environmental documents and to
manage litigation.  
   (B) Administrative costs.  
   (C) Litigation.  
   (3) An explanation of all litigation initiated against the
department for the responsibilities assumed pursuant to Section 326
of, and subsection (a) of Section 327 of, Title 23 of the United
States Code.  
   (4) A comparison of all costs and benefits of assuming these
responsibilities.  
   (5) An assessment of overall project delivery time from the time
environmental studies begin to the time the project is ready to
advertise for construction, including the time required for each
project phase and distinguishing between different types of
environmental documents and between projects on the state highway
system and local assistance projects. The department may also include
other variables that it determines may be useful in the assessment.
 
   (e) (1) This section shall remain in effect only until January 1,
2017, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2017, deletes or extends
that date.  
   (2) The state shall remain liable for any decisions made, or
responsibilities assumed and exercised, prior to the repeal of this
section under this subdivision, pursuant to applicable federal
statutes of limitation for filing citizens' suits in federal court.
 
   (f) 
    (d)  Nothing in this section affects the obligation of
the department to comply with state and federal law.
   SEC. 24.    Chapter 2 (commencing with Section 2030)
is added to Division 3 of the   Streets and Highways Code
  , to read:  
      CHAPTER 2.  ROAD MAINTENANCE AND REHABILITATION PROGRAM


   2030.  (a) The Road Maintenance and Rehabilitation Program is
hereby created to address deferred maintenance on the state
                                     highway system and the local
street and road system. Funds made available by the program shall be
prioritized for expenditure on basic road maintenance and road
rehabilitation projects, and on critical safety projects. For funds
appropriated pursuant to paragraph (1) of subdivision (d) of Section
2032, the California Transportation Commission shall adopt
performance criteria, consistent with the asset management plan
required pursuant to 14526.4 of the Government Code, to ensure
efficient use of the funds available for these purposes in the
program.
   (b) (1) Funds made available by the program shall be used for
projects that include, but are not limited to, the following:
   (A) Road maintenance and rehabilitation.
   (B) Safety projects.
   (C) Railroad grade separations.
   (D) Complete street components, including active transportation
purposes, pedestrian and bicycle safety projects, transit facilities,
and drainage and stormwater capture projects in conjunction with any
other allowable project.
   (E) Traffic control devices.
   (2) Funds made available by the program may also be used to
satisfy a match requirement in order to obtain state or federal funds
for projects authorized by this subdivision.
   2031.  The following revenues shall be deposited in the Road
Maintenance and Rehabilitation Account, which is hereby created in
the State Transportation Fund:
   (a) Notwithstanding subdivision (b) of Section 2103, the portion
of the revenues in the Highway Users Tax Account attributable to the
increase in the motor vehicle fuel excise tax by seventeen cents
($0.17) per gallon pursuant to subdivision (a) of Section 7360 of the
Revenue and Taxation Code, as adjusted pursuant to subdivision (c)
of that section.
   (b) The revenues from the increase in the vehicle registration fee
pursuant to Section 9250.3 of the Vehicle Code.
   (c) The revenues from the increase in the vehicle registration fee
pursuant to Section 9250.6 of the Vehicle Code.
   (d) The revenues deposited in the account pursuant to Section
183.1 of the Streets and Highways Code.
   (e) Any other revenues designated for the program.
   2031.5.  Each fiscal year the annual Budget Act shall contain an
appropriation from the Road Maintenance and Rehabilitation Account to
the Controller for the costs of carrying out his or her duties
pursuant to this chapter and to the California Transportation
Commission for the costs of carrying out its duties pursuant to this
chapter and Section 14526.7 of the Government Code.
   2032.  (a) (1) After deducting the amounts appropriated in the
annual Budget Act, as provided in Section 2031.5, two hundred million
dollars ($200,000,000) of the remaining revenues deposited in the
Road Maintenance and Rehabilitation Account shall be set aside
annually for counties that have sought and received voter approval of
taxes or that have imposed fees, including uniform developer fees as
defined by subdivision (b) of Section 8879.67 of the Government
Code, which taxes or fees are dedicated solely to transportation
improvements. The Controller shall each month set aside one-twelfth
of this amount, to accumulate a total of two hundred million dollars
($200,000,000) in each fiscal year.
   (2) Notwithstanding Section 13340 of the Government Code, the
funds available under this subdivision in each fiscal year are hereby
continuously appropriated for allocation to each eligible county and
each city in the county for road maintenance and rehabilitation
purposes pursuant to Section 2033.
   (b) (1) After deducting the amounts appropriated in the annual
Budget Act pursuant to Section 2031.5 and the amount allocated in
subdivision (a), beginning in the 2017-18 fiscal year, eighty million
dollars ($80,000,000) of the remaining revenues shall be transferred
annually to the State Highway Account for expenditure, upon
appropriation by the Legislature, on the Active Transportation
Program created pursuant to Chapter 8 (commencing with Section 2380)
of Division 3 to be allocated by the California Transportation
Commission pursuant to Section 2381.
   (2) In addition to the funds transferred in paragraph (1), the
department shall annually identify savings achieved through
efficiencies implemented at the department. The department, through
the annual budget process, shall propose, from the identified
savings, an appropriation to be included in the annual Budget Act of
up to seventy million dollars ($70,000,000), but not to exceed the
total annual identified savings, from the State Highway Account for
expenditure on the Active Transportation Program.
   (c) After deducting the amounts appropriated in the annual Budget
Act pursuant to Section 2031.5, the amount allocated in subdivision
(a) and the amount transferred in paragraph (1) of subdivision (b),
in the 2017-18, 2018-19, 2019-20, and 2020-21 fiscal years, the sum
of thirty million dollars ($30,000,000) in each fiscal year from the
remaining revenues shall be transferred to the Advance Mitigation
Fund in the State Transportation Fund created pursuant to Section
21207 of the Public Resources Code.
   (d) After deducting the amounts appropriated in the annual Budget
Act pursuant to Section 2031.5, the amount allocated in subdivision
(a), and the amounts transferred in paragraph (1) of subdivision (b)
and in subdivision (c), beginning in the 2017-18 fiscal year and each
fiscal year thereafter, and notwithstanding Section 13340 of the
Government Code, there is hereby continuously appropriated to the
California State University the sum of two million dollars
($2,000,000) from the remaining revenues for the purpose of
conducting transportation research and transportation-related
workforce education, training, and development. Prior to the start of
each fiscal year, the chairs of the Assembly Committee on
Transportation and the Senate Committee on Transportation and Housing
shall confer and set out a recommended priority list of research
components to be addressed in the upcoming fiscal year.
   (e) Notwithstanding Section 13340 of the Government Code, the
balance of the revenues deposited in the Road Maintenance and
Rehabilitation Account are hereby continuously appropriated as
follows:
   (1) Fifty percent for allocation to the department for maintenance
of the state highway system or for purposes of the state highway
operation and protection program.
   (2) Fifty percent for apportionment to cities and counties by the
Controller pursuant to the formula in clauses (i) and (ii) of
subparagraph (C) of paragraph (3) of subdivision (a) of Section 2103
for the purposes authorized by this chapter.
   2033.  (a) On or before January 1, 2017, the commission, in
cooperation with the department, transportation planning agencies,
county transportation commissions, and other local agencies, shall
develop guidelines for the allocation of funds pursuant to
subdivision (a) of Section 2032.
   (b) The guidelines shall be the complete and full statement of the
policy, standards, and criteria that the commission intends to use
to determine how these funds will be allocated.
   (c) The commission may amend the adopted guidelines after
conducting at least one public hearing.
   2034.  (a) (1) Prior to receiving an apportionment of funds under
the program pursuant to paragraph (2) of subdivision (d) of Section
2032 from the Controller in a fiscal year, an eligible city or county
shall submit to the commission a list of projects proposed to be
funded with these funds pursuant to an adopted city or county budget.
All projects proposed to receive funding shall be included in a city
or county budget that is adopted by the applicable city council or
county board of supervisors at a regular public meeting. The list of
projects proposed to be funded with these funds shall include a
description and the location of each proposed project, a proposed
schedule for the project's completion, and the estimated useful life
of the improvement. The project list shall not limit the flexibility
of an eligible city or county to fund projects in accordance with
local needs and priorities so long as the projects are consistent
with subdivision (b) of Section 2030.
   (2) The commission shall report to the Controller the cities and
counties that have submitted a list of projects as described in this
subdivision and that are therefore eligible to receive an
apportionment of funds under the program for the applicable fiscal
year. The Controller, upon receipt of the report, shall apportion
funds to eligible cities and counties.
   (b) For each fiscal year, each city or county receiving an
apportionment of funds shall, upon expending program funds, submit
documentation to the commission that includes a description and
location of each completed project, the amount of funds expended on
the project, the completion date, and the estimated useful life of
the improvement.
   2036.  (a) Cities and counties shall maintain their existing
commitment of local funds for street, road, and highway purposes in
order to remain eligible for an allocation or apportionment of funds
pursuant to Section 2032.
   (b) In order to receive an allocation or apportionment pursuant to
Section 2032, the city or county shall annually expend from its
general fund for street, road, and highway purposes an amount not
less than the annual average of its expenditures from its general
fund during the 2009-10, 2010-11, and 2011-12 fiscal years, as
reported to the Controller pursuant to Section 2151. For purposes of
this subdivision, in calculating a city's or county's annual general
fund expenditures and its average general fund expenditures for the
2009-10, 2010-11, and 2011-12 fiscal years, any unrestricted funds
that the city or county may expend at its discretion, including
vehicle in-lieu tax revenues and revenues from fines and forfeitures,
expended for street, road, and highway purposes shall be considered
expenditures from the general fund. One-time allocations that have
been expended for street and highway purposes, but which may not be
available on an ongoing basis, including revenue provided under the
Teeter Plan Bond Law of 1994 (Chapter 6.6 (commencing with Section
54773) of Part 1 of Division 2 of Title 5 of the Government Code),
may not be considered when calculating a city's or county's annual
general fund expenditures.
   (c) For any city incorporated after July 1, 2009, the Controller
shall calculate an annual average expenditure for the period between
July 1, 2009, and December 31, 2015, inclusive, that the city was
incorporated.
   (d) For purposes of subdivision (b), the Controller may request
fiscal data from cities and counties in addition to data provided
pursuant to Section 2151, for the 2009-10, 2010-11, and 2011-12
fiscal years. Each city and county shall furnish the data to the
Controller not later than 120 days after receiving the request. The
Controller may withhold payment to cities and counties that do not
comply with the request for information or that provide incomplete
data.
   (e) The Controller may perform audits to ensure compliance with
subdivision (b) when deemed necessary. Any city or county that has
not complied with subdivision (b) shall reimburse the state for the
funds it received during that fiscal year. Any funds withheld or
returned as a result of a failure to comply with subdivision (b)
shall be reapportioned to the other counties and cities whose
expenditures are in compliance.
   (f) If a city or county fails to comply with the requirements of
subdivision (b) in a particular fiscal year, the city or county may
expend during that fiscal year and the following fiscal year a total
amount that is not less than the total amount required to be expended
for those fiscal years for purposes of complying with subdivision
(b).
   2037.  A city or county may spend its apportionment of funds under
the program on transportation priorities other than those allowable
pursuant to this chapter if the city's or county's average Pavement
Condition Index meets or exceeds 80.
   2038.  (a) The department and local agencies, as a condition of
receiving funds from the program, shall adopt and implement a program
designed to promote and advance construction employment and training
opportunities through preapprenticeship opportunities, either by the
public agency itself or through contractors engaged by the public
agencies to do work funded in whole or in part by funds made
available by the program.
   (b) The department and local agencies, as a condition of receiving
funds from the program, shall ensure the involvement of the
California Conservation Corps and certified community conservation
corps in the delivery of projects and services funded in whole or in
part by funds made available by the program. 
   SEC. 25.    Section 2103.1 is added to the  
Streets and Highways Code   , to read:  
   2103.1.  (a) Notwithstanding Section 2103, the revenues
transferred to the Highway Users Tax Account pursuant to Sections
8352.4, 8352.5, and 8352.6 of the Revenue and Taxation Code shall be
distributed pursuant to the formula in paragraph (3) of subdivision
(a) of Section 2103.
   (b) Notwithstanding subdivision (b) of Section 2103, the portion
of revenues in the Highway Users Tax Account attributable to the
increase in the motor vehicle fuel excise tax by seventeen cents
($0.17) per gallon pursuant to subdivision (a) of Section 7360 of the
Revenue and Taxation Code, as adjusted pursuant to subdivision (c)
of that section, shall be transferred to the Road Maintenance and
Rehabilitation Account pursuant to Section 2031.
   (c) Notwithstanding subdivision (b) of Section 2103, the portion
of revenues in the Highway Users Tax Account attributable to the
increase in the diesel fuel excise tax by thirty cents ($0.30) per
gallon pursuant to subdivision (b) of Section 60050 of the Revenue
and Taxation Code, as adjusted pursuant to subdivision (c) of that
section, shall be transferred to the Trade Corridors Improvement Fund
pursuant to Section 2192.4. 
   SEC. 26.    Section 2192 of the  Streets and
Highways Code   is amended to read: 
   2192.  (a)  (1)    The Trade Corridors
Improvement Fund, created pursuant to subdivision (c) of Section
8879.23 of the Government Code, is hereby continued in existence to
receive revenues from  state  sources other than the Highway
Safety, Traffic Reduction, Air Quality, and Port Security Bond Act
of 2006.  This chapter shall govern expenditure of those
other revenues.  
   (2) Revenues apportioned to the state under Section 167 of Title
23 of the United States Code from the national highway freight
program, pursuant to the federal Fixing America's Surface
Transportation Act ("FAST Act," Public Law 114-94) shall be allocated
for projects approved pursuant to this chapter. 
   (b) This chapter shall govern the expenditure of those state and
federal revenues described in subdivision (a).  
   (b) The moneys in the fund from these other sources 
    (c)     The funding described in
subdivision (a)  shall be available upon appropriation for
allocation by the California Transportation Commission for
infrastructure improvements in this state on federally designated
Trade Corridors of National and Regional Significance, on the Primary
Freight Network, and along other corridors that have a high volume
of freight movement, as determined by the commission. In determining
the projects eligible for funding, the commission shall consult the
Transportation Agency's state freight plan as described in Section
13978.8 of the Government  Code, the State Air Resources
Board's Sustainable Freight Strategy adopted by Resolution 14-2,
  Code  and the trade infrastructure and goods
movement plan submitted to the commission by the Secretary of
Transportation and the Secretary for Environmental Protection. The
commission shall also consult trade infrastructure and goods movement
plans adopted by regional transportation planning agencies, adopted
regional transportation plans required by state and federal law, and
the  statewide   applicable  port master
plan  prepared by the California Marine and Intermodal
Transportation System Advisory Council (Cal-MITSAC) pursuant to
Section 1730 of the Harbors and Navigation Code,  when
determining eligible projects for funding. Eligible projects for
these funds include, but are not limited to, all of the following:
   (1) Highway capacity  improvements, rail landside access
improvements, landside freight access  improvements  to
airports,  and operational improvements to more efficiently
accommodate the movement of freight, particularly for ingress and
egress to and from the state's land ports of  entry 
 entry, rail terminals,  and seaports, including navigable
inland waterways used to transport freight between seaports, land
ports of entry, and airports, and to relieve traffic congestion along
major trade or goods movement corridors.
   (2) Freight rail system improvements to enhance the ability to
move goods from seaports, land ports of entry, and airports to
warehousing and distribution centers throughout California, including
projects that separate rail lines from highway or local road
traffic, improve freight rail mobility through mountainous regions,
relocate rail switching yards, and other projects that improve the
efficiency and capacity of the rail freight system.
   (3) Projects to enhance the capacity and efficiency of ports.
   (4) Truck corridor  and capital and operational 
improvements, including dedicated truck facilities or truck toll
facilities.
   (5) Border  access   capital and operational
 improvements that enhance goods movement between California and
Mexico and that maximize the state's ability to access 
coordinated border infrastructure  funds made available to
the state by federal law.
   (6) Surface transportation and connector road improvements to
effectively facilitate the movement of goods, particularly for
ingress and egress to and from the state's land ports of entry,
airports, and seaports, to relieve traffic congestion along major
trade or goods movement corridors. 
   (c) (1) The 
    (d)     (1)     Except
  as provided in paragraph (2), the  commission shall
allocate  funds   the funding described in
subdivision (a)  for trade infrastructure improvements 
from the fund  consistent with Section 8879.52 of the
Government Code and the Trade Corridors Improvement Fund (TCIF)
Guidelines adopted by the commission on November 27, 2007, or as
amended by the commission, and in a manner that (A) addresses the
state's most urgent needs, (B) balances the demands of various land
ports of entry, seaports, and airports, (C) provides reasonable
geographic balance between the state's regions,  and
 (D) places emphasis on projects that improve trade corridor
mobility  and safety  while reducing emissions of diesel
particulate and other pollutant  emissions.  
emissions and reducing other negative community impacts, and (E)
makes a significant contribution to the state's economy.  
   (2) The commission shall allocate the federal freight funding,
specifically, pursuant to the original TCIF Guidelines, as adopted by
the commission on November 27, 2007, and in the manner described in
(A) to (E), inclusive, of paragraph (1).  
   (2) 
    (3)  In addition, the commission shall also consider the
following factors when allocating these funds:
   (A) "Velocity," which means the speed by which large cargo would
travel from the land port of entry or seaport through the
distribution system.
   (B) "Throughput," which means the volume of cargo that would move
from the land port of entry or seaport through the distribution
system.
   (C) "Reliability," which means a reasonably consistent and
predictable amount of time for cargo to travel from one point to
another on any given day or at any given time in California.
   (D) "Congestion reduction," which means the reduction in recurrent
daily hours of delay to be achieved.
   SEC. 27.    Section 2192.1 of the   Streets
and Highways Code   is amended to read: 
   2192.1.  (a) To the extent moneys from the Greenhouse Gas
Reduction Fund, attributable to the auction or sale of allowances as
part of a market-based compliance mechanism relative to reduction of
greenhouse gas emissions, are transferred to the Trade Corridors
Improvement Fund, projects funded with those moneys shall be subject
to all of the requirements of existing law applicable to the
expenditure of moneys appropriated from the Greenhouse Gas Reduction
Fund, including, but not limited to,  both   all
 of the following:
   (1) Projects shall further the regulatory purposes of the
California Global Warming Solutions Act of 2006 (Division 25.5
(commencing with Section 38500) of the Health and Safety Code),
including reducing emissions from greenhouse gases in the state,
directing public and private investment toward disadvantaged
communities, increasing the diversity of energy sources, or creating
opportunities for businesses, public agencies, nonprofits, and other
community institutions to participate in and benefit from statewide
efforts to reduce emissions of greenhouse gases.
   (2) Projects shall be consistent with the guidance developed by
the State Air Resources Board pursuant to Section 39715 of the Health
and Safety Code. 
   (3) Projects shall be consistent with the required benefits to
disadvantaged communities pursuant to Section 39713 of the Health and
Safety Code. 
   (b) All allocations of funds made by the commission pursuant to
this section shall be made in a manner consistent with the criteria
expressed in Section 39712 of the Health and Safety Code and with the
investment plan developed by the Department of Finance pursuant to
Section 39716 of the Health and Safety Code. 
   (c) For purposes of this section, "disadvantaged community" means
a community with any of the following characteristics:  
   (1) An area with a median household income less than 80 percent of
the statewide median household income based on the most current
census tract-level data from the American Community Survey. 

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

   (3) An area where at least 75 percent of public school students
are eligible to receive free or reduced-price meals under the
National School Lunch Program. 
   SEC. 28.    Section 2192.2 of the   Streets
and Highways Code   is amended to read: 
   2192.2.  The commission shall allocate funds made available by
this chapter to projects that have identified and committed
supplemental funding from appropriate local, federal, or private
sources. The commission shall determine the appropriate amount of
supplemental funding each project should have to be eligible for
moneys  from the fund  based on a project-by-project
review and an assessment of the project's benefit to the state and
the program.  Except for border access   Funded
 improvements  described in paragraph (5) of subdivision
(b) of Section 2192, improvements funded with moneys from the fund
 shall have supplemental funding that is at least equal to
the amount of the contribution  from the fund.  
under this chapter.  The commission may give priority for
funding to projects with higher levels of committed supplemental
funding.
   SEC. 29.    Section 2192.4 is added to the  
Streets and Highways Code   , to read:  
   2192.4.  Notwithstanding subdivision (b) of Section 2103, the
portion of the revenues in the Highway Users Tax Account attributable
to the increase in the diesel fuel excise tax by thirty cents
($0.30) per gallon pursuant to subdivision (b) of Section 60050 of
the Revenue and Taxation Code, as adjusted pursuant to subdivision
(c) of that section, shall be deposited in the Trade Corridors
Improvement Fund. 
   SEC. 30.   Section 9250.3 is added to the  
Vehicle Code   , to read:  
   9250.3.  (a) In addition to any other fees specified in this code
or the Revenue and Taxation Code, commencing 120 days after the
effective date of the act adding this section, a registration fee of
thirty-eight dollars ($38) shall be paid to
                   the department for registration or renewal of
registration of every vehicle subject to registration under this
code, except those vehicles that are expressly exempted under this
code from payment of registration fees.
   (b) Beginning July 1, 2019, and every third year thereafter, the
Department of Motor Vehicles shall adjust the fee imposed under this
section for inflation in an amount equal to the change in the
California Consumer Price Index for the prior three-year period, as
calculated by the Department of Finance, with amounts equal to or
greater than fifty cents ($0.50) rounded to the next highest whole
dollar.
   (c) Revenues from the fee, after the deduction of the department's
administrative costs related to this section, shall be deposited in
the Road Maintenance and Rehabilitation Account created pursuant to
Section 2031 of the Streets and Highways Code. 
   SEC. 31.    Section 9250.6 is added to the  
Vehicle Code   , to read:  
   9250.6.  (a) In addition to any other fees specified in this code,
or the Revenue and Taxation Code, commencing 120 days after the
effective date of the act adding this section, a registration fee of
one hundred and sixty-five dollars ($165) shall be paid to the
department for registration or renewal of registration of every
zero-emission motor vehicle subject to registration under this code,
except those motor vehicles that are expressly exempted under this
code from payment of registration fees.
   (b) Beginning July 1, 2019, and every third year thereafter, the
Department of Motor Vehicles shall adjust the fee imposed under this
section for inflation in an amount equal to the change in the
California Consumer Price Index for the prior three-year period, as
calculated by the Department of Finance, with amounts equal to or
greater than fifty cents ($0.50) rounded to the next highest whole
dollar.
   (c) Revenues from the fee, after deduction of the department's
administrative costs related to this section, shall be deposited in
the Road Maintenance and Rehabilitation Account created pursuant to
Section 2031 of the Streets and Highways Code.
   (d) This section does not apply to a commercial motor vehicle
subject to Section 9400.1.
   (e) The registration fee required pursuant to this section does
not apply to the initial registration after the purchase of a new
zero-emission motor vehicle.
   (f) For purposes of this section, "zero-emission motor vehicle"
means a motor vehicle as described in subdivisions (c) and (d) of
Section 44258 of the Health and Safety Code, or any other motor
vehicle that is able to operate on any fuel other than gasoline or
diesel fuel. 
   SEC. 32.    Section 9400.5 is added to the  
Vehicle Code   , to read:  
   9400.5.  (a) Notwithstanding Sections 9400.1, 9400.4, and 42205 of
this code, Sections 16773 and 16965 of the Government Code, Section
2103 of the Streets and Highways Code, or any other law, weight fee
revenues shall only be transferred consistent with the schedule
provided in subdivision (b) 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 and shall not be loaned to the General Fund.
   (b) (1) The transfer of weight fee revenues, after deduction of
collection costs, from the State Highway Account pursuant to
subdivision (a) shall not exceed:
   (A) 80 percent of the total weight fees in the 2017-18 fiscal
year.
   (B) 60 percent of the total weight fees in the 2018-19 fiscal
year.
   (C) 40 percent of the total weight fees in the 2019-20 fiscal
year.
   (D) 20 percent of the total weight fees in the 2020-2021 fiscal
year.
   (2) No weight fees, after deduction of collection costs, shall be
transferred from the State Highway Account after the 2020-21 fiscal
year. 
   SEC. 33.    This act is an urgency statute necessary
for the immediate preservation of the public peace, health, or safety
within the meaning of Article IV of the Constitution and shall go
into immediate effect. The facts constituting the necessity are:
 
   In order to provide additional funding for road maintenance and
rehabilitation purposes as quickly as possible, it is necessary for
this act to take effect immediately.  All matter omitted in this
version of the bill appears in the bill as amended in the Senate,
April 21, 2016. (JR11)