Amended in Senate May 31, 2016

Amended in Senate April 11, 2016

Amended in Senate March 15, 2016

Senate Bill No. 824

Introduced by Senator Beall

January 7, 2016

An act to amend Section 75230 of, and to add Section 75231 to, the Public Resources Code, relating to transportation.

LEGISLATIVE COUNSEL’S DIGEST

SB 824, as amended, Beall. Low Carbon Transit Operations Program.

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

Existing law continuously appropriates specified portions of the annual proceeds in the Greenhouse Gas Reduction Fund to various programs, including 5% for the Low Carbon Transit Operations Program, for expenditures to provide transit operating or capital assistance consistent with specified criteria. Existing law provides for distribution of available funds under the program by a specified formula to recipient transit agencies by the Controller, upon approval of the recipient transit agency’s proposed expenditures by the Department of Transportation.

This bill would authorize a recipient transit agency that does not submit begin delete a project end delete begin insert an expenditure end insert for funding under the program in a particular fiscal year to retain its funding share for expenditure in a subsequent fiscal year. The bill would allow a recipient transit agency to loan or transfer its funding share in any particular fiscal year to another recipient transit agency within the same region, begin delete to pool its funding share with those of other recipient transit agencies, end delete or to apply to the department to reassign, to other eligible expenditures under the program, any savings of surplus moneys from an approved and completed expenditure under the program or from an approved expenditure that is no longer a priority, as specified. The bill would also allow a recipient transit agency to apply to the department for a letter of no prejudice for any eligible expenditures under the program for which the department has authorized a disbursement of funds, and, if granted, would allow the recipient transit agency to expend its own moneys and to be eligible for future reimbursement from the program, under specified conditions. The bill would also require a recipient transit agency to provide additional information to the department to the extent funding is sought for capital projects.

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

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

SECTION 1.  

Section 75230 of the Public Resources Code is
amended to read:

75230.  

(a) The Low Carbon Transit Operations Program is
hereby created to provide operating and capital assistance for transit
agencies to reduce greenhouse gas emissions and improve mobility,
with a priority on serving disadvantaged communities.

(b) Funding for the program is continuously appropriated
pursuant to Section 39719 of the Health and Safety Code from the
Greenhouse Gas Reduction Fund established pursuant to Section
16428.8 of the Government Code.

(c) Funding shall be allocated by the Controller on a formula
basis consistent with the requirements of this part and with Section
39719 of the Health and Safety Code, upon a determination by the
Department of Transportation that the expenditures proposed by
a recipient transit agency meet the requirements of this part and
guidelines developed pursuant to begin delete subdivision (f), end delete begin insert this section, end insert and
that the amount of funding requested is currently available.

(d) A recipient transit agency shall demonstrate that each
expenditure of program moneys allocated to the agency reduces
greenhouse gas emissions.

(e) Moneys for the program shall be expended to provide transit
operating or capital assistance that meets any of the following:

(1) Expenditures supporting new or expanded bus or rail
services, new or expanded water-borne transit, or expanded
intermodal transit facilities, and may include equipment acquisition,
fueling, and maintenance, and other costs to operate those services
or facilities. begin delete A recipient transit agency may use program moneys
for the costs to operate new or expanded service in the fiscal year
in which the service is first implemented, and in any subsequent
fiscal year if the agency can demonstrate that additional reductions
in greenhouse gas emissions can be realized. end delete

(2) Expenditures that begin delete directly enhance or expand transit service
to end delete increase mode share.

begin delete

(3) Any other expenditure for which the recipient transit agency
can demonstrate that the expenditure reduces greenhouse gas
emissions.

end delete begin insert

(3) Expenditures related to the purchase of zero-emission buses,
including electric buses, or the installation of the necessary
equipment and infrastructure to operate and support zero-emission
buses.

end insert

(f) For recipient transit agencies whose service areas include
disadvantaged communities as identified pursuant to Section 39711
of the Health and Safety Code, at least 50 percent of the total
moneys received pursuant to this chapter shall be expended on
projects or services that meet requirements of subdivision (d) and
benefit the disadvantaged communities, consistent with the
guidance developed by the State Air Resources Board pursuant to
Section 39715 of the Health and Safety Code.

(g) The Department of Transportation, in coordination with the
State Air Resources Board, shall develop guidelines that describe
the methodologies that recipient transit agencies shall use to
demonstrate that proposed expenditures will meet the criteria in
subdivisions (d) and (f) and establish the reporting requirements
for documenting ongoing compliance with those criteria.

(h) Chapter 3.5 (commencing with Section 11340) of Part 1 of
Division 3 of Title 2 of the Government Code does not apply to
the development of guidelines for the program pursuant to this
section.

(i) A recipient transit agency shall submit the following
information to the Department of Transportation before seeking a
disbursement of funds pursuant to this part:

(1) A list of proposed expense types for anticipated funding
levels.

(2) The documentation required by the guidelines developed
pursuant to this section to demonstrate compliance with
subdivisions (d) and (f).

(j) For capital projects, the recipient transit agency shall also
do all of the following:

(1) Specify the phases of work for which the agency is seeking
an allocation of moneys from the program.

(2) Identify the sources and timing of all moneys required to
undertake and complete any phase of a project for which the
recipient agency is seeking an allocation of moneys from the
program.

(3) Describe intended sources and timing of funding to complete
any subsequent phases of the project, through construction or
procurement.

begin insert

(k) A recipient transit agency may use program moneys for
operating assistance in the fiscal year in which the service is first
implemented, and in any subsequent fiscal year if the agency can
demonstrate that reductions in greenhouse gas emissions can be
realized.

end insert begin delete

(k)

end delete

begin insert (l) end insert  Before authorizing the disbursement of funds, the Department
of Transportation, in coordination with the State Air Resources
Board, shall determine the eligibility, in whole or in part, of the
proposed list of expense types, based on the documentation
provided by the recipient transit agency to ensure ongoing
compliance with the guidelines developed pursuant to this section.

begin delete

(l)

end delete

begin insert (m) end insert  The Department of Transportation shall notify the Controller
of approved expenditures for each recipient transit agency, and
the amount of the allocation for each agency determined to be
available at that time of approval.

begin delete

(m)

end delete

begin insert (n) end insert  A recipient transit agency that does not submit begin delete a project end delete begin insert an
expenditure end insert for funding in a particular fiscal year shall retain its
funding share, and may accumulate and utilize that funding share
in a subsequent fiscal year for a larger begin delete expenditure. end delete begin insert expenditure,
including operating assistance. end insert The recipient transit agency shall
specify the number of fiscal years that it intends to retain its
funding share and the expenditure for which the agency intends
to use these moneys. There shall be no limit on the number of
fiscal years that a recipient transit agency may retain its funding
share.

begin delete

(n)

end delete

begin insert (o) end insert  A recipient transit agency may, in any particular fiscal year,
loan or transfer its funding share to another recipient transit agency
within the same region for any identified eligible expenditure under
the program, begin insert including operating assistance, end insert in accordance with
procedures incorporated by the Department of Transportation in
the guidelines developed pursuant to this section, which procedures
shall be consistent with the requirement in subdivision (f).

begin delete

(o) A group of recipient transit agencies may, in any particular
fiscal year, enter into an agreement to pool the respective funding
shares of each member of the group for any identified eligible
expenditure under the program, in accordance with procedures
incorporated by the Department of Transportation in the guidelines
developed pursuant to this section, which procedures shall be
consistent with the requirement in subdivision (f).

end delete

(p) A recipient transit agency may apply to the Department of
Transportation to reassign any savings of surplus moneys allocated
under this section to the agency for an expenditure that has been
completed to another eligible expenditure under the begin delete program. end delete
begin insert program, including operating assistance. end insert A recipient transit agency
may also apply to the Department of Transportation to reassign to
another eligible expenditure any moneys from the program
previously allocated to the agency for an expenditure that the
agency has determined is no longer a priority for the use of those
moneys.

(q) The recipient transit agency shall provide annual reports to
the Department of Transportation, in the format and manner
prescribed by the department, consistent with the internal
administrative procedures for use of fund proceeds developed by
the State Air Resources Board.

(r) The Department of Transportation and recipient transit
agencies shall comply with the guidelines developed by the State
Air Resources Board pursuant to Section 39715 of the Health and
Safety Code to ensure that the requirements of Section 39713 of
the Health and Safety Code are met to maximize the benefits to
disadvantaged communities as described in Section 39711 of the
Health and Safety Code.

(s) The audit of public transportation operator finances already
required under the Transportation Development Act pursuant to
Section 99245 of the Public Utilities Code shall be expanded to
include verification of receipt and appropriate expenditure of
moneys from the program. Each recipient transit agency receiving
moneys from the program in a fiscal year for which an audit is
conducted shall transmit a copy of the audit to the Department of
Transportation, and the department shall make the audits available
to the Legislature and the Controller for review on request.

SEC. 2.  

Section 75231 is added to the Public Resources Code,
to read:

75231.  

(a) A recipient transit agency under the program created
pursuant to Section 75230 may apply to the Department of
Transportation for a letter of no prejudice for any eligible
expenditures under the begin delete program end delete begin insert program, including operating
assistance, end insert for which the department has authorized a disbursement
of funds. If approved by the department, the letter of no prejudice
shall allow the recipient transit agency to expend its own moneys
for the expenditures and to be eligible for future reimbursement
from moneys available for the program.

(b) The amount expended under subdivision (a) shall be
reimbursed by the state from moneys available for the program if
all of the following conditions are met:

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

(2) The expenditures made by the recipient transit agency are
eligible under the program. If expenditures made by the recipient
transit agency are determined to be ineligible, the state has no
obligation to reimburse those expenditures.

(3) The recipient transit agency complies with all legal
requirements for the expenditures, including the requirements of
the California Environmental Quality Act (Division 13
(commencing with Section 21000)), if applicable.

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

(c) The recipient transit agency and the Department of
Transportation shall enter into an agreement governing
reimbursement as described in this section. The timing and final
amount of reimbursement shall be dependent on the terms of the
agreement and the availability of moneys in the Greenhouse Gas
Reduction Fund for the program.

(d) The Department of Transportation, in consultation with
recipient public transit agencies, may develop guidelines to
implement this section.