BILL ANALYSIS Ó
SB 824
Page 1
SENATE THIRD READING
SB
824 (Beall)
As Amended August 18, 2016
Majority vote
SENATE VOTE: 26-11
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|Committee |Votes|Ayes |Noes |
| | | | |
| | | | |
| | | | |
|----------------+-----+-----------------------+---------------------|
|Transportation |12-1 |Frazier, Linder, |Melendez |
| | |Baker, Bloom, Brown, | |
| | |Chu, Daly, Dodd, | |
| | |Eduardo Garcia, Gomez, | |
| | |Nazarian, O'Donnell | |
| | | | |
|----------------+-----+-----------------------+---------------------|
|Appropriations |14-2 |Gonzalez, Bloom, |Gallagher, Obernolte |
| | |Bonilla, Bonta, | |
| | |Calderon, Daly, | |
| | |Eggman, Eduardo | |
| | |Garcia, Holden, Quirk, | |
| | |Santiago, Weber, Wood, | |
| | |McCarty | |
| | | | |
| | | | |
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SB 824
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SUMMARY: Makes various program changes to the Low Carbon
Transit Operations Program (LCTOP). Specifically, this bill:
1)Recasts and streamlines the requirements for eligible uses of
funding for LCTOP for operating or capital assistance projects
by requiring transit agencies to meet any, instead of all, of
the following expanded criteria:
a) Directly enhance or expand transit service by supporting
new or expanded bus or rail services or water-borne
transit; and expanded intermodal transit facilities,
including equipment acquisition, fueling, maintenance, and
other costs of operating the facility;
b) Operational expenditures to increase transit mode share;
or,
c) The purchase of zero-emission buses, including electric
buses, and the installation of the necessary equipment and
infrastructure to operate and support those zero-emission
buses.
1)Allows a transit agency to use LCTOP funds for continued
operations of new or expanded transit services or programs
previously funded from LCTOP if the agency can demonstrate
continued reductions in greenhouse gas emissions (GHG).
2)Requires a transit agency proposing to use LCTOP expenditures
on capital projects to submit information to the California
Department of Transportation (Caltrans), specifying the phases
of work for which the agency is seeking an allocation,
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identifying the sources and timing of all moneys required for
the project, and describing the intended sources of funding
and timing to complete any subsequent phase.
3)Allows a transit agency to retain their funding share, for no
more than four years, to accumulate and utilize funding in a
subsequent year for a larger expenditure. Requires the agency
to specify the number of years it intends to retain its share
and on what the agency intends to spend the funds.
4)Allows a transit agency to loan or transfer its funding share,
in a fiscal year, to another eligible transit agency within
the same region.
5)Allows a transit agency to apply to Caltrans to reassign any
project savings to another or reassign funds from a previously
approved project to another eligible expenditure.
6)Allows a transit agency to apply to Caltrans for a letter of
no prejudice (LONP) for eligible expenditures under the
program to allow the agency to expend its own resources and be
eligible for reimbursement from its future funding share.
7)Requires the state to reimburse the transit agency for the
LONP if all of the following are met:
a) The expenditures have commenced and regional or local
expenditures have been incurred;
b) The expenditures made by the transit agency are eligible
for the program;
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c) The recipient transit agency has complied with all
applicable legal requirements, including the California
Environmental Quality Act (CEQA), and federal and state
civil rights and environmental justice laws; and,
d) There are funds available from the Greenhouse Gas
Reduction Fund (GGRF) designated for the program and from
the transit agency's formula allocation.
1)Requires Caltrans and the transit agency to enter into an
agreement governing the LONP reimbursement.
2)Allows Caltrans to develop guidelines for the use of the LONP.
3)Requires transit agencies receiving LCTOP funding to
demonstrate that the expenditures do not supplant another
source of funds.
4)Expands the contents of the existing audit of transit agencies
required under the Transportation Development Act to include
verification and receipt of funds from LCTOP and requires a
copy of the audit be sent to Caltrans to be available to the
Legislature or the Controller for review.
5)Requires that transit agencies comply with all applicable
legal requirements, including the CEQA, and federal and state
civil rights and environmental justice laws and clarifies that
the section does not expand any of those laws to the agencies.
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FISCAL EFFECT: According to the Assembly Appropriations
Committee:
1)Ongoing special fund costs to Caltrans, which administers the
LCTOP, of $200,000 for two positions to revise program
guidelines, establish systems for tracking the LONP process,
monitor transit agencies' accounting for and use of funds, as
modified by the bill, prepare the Legislature report, and for
workload associated with the expanded audit requirements.
2)Ongoing special fund cost to the Air Resources Board of
$160,000 for one position to coordinate with Caltrans on the
adoption of program guidelines, and provide guidance on
tracking and reporting GHG reductions and disadvantaged
communities' benefits.
3)Potentially significant cost pressures, from expanding
eligible use of LCTOP funds to include expenditures for the
purchase of zero-emission buses and equipment and
infrastructure to operate and support those buses.
COMMENTS: LCTOP was created by SB 862 (Committee on Budget and
Fiscal Review), Chapter 36, Statutes of 2014, as part of a
comprehensive package of programs to target GHG reductions in
California using funds generated by the state's cap and trade
program. LCTOP is administered by Caltrans and is continuously
appropriated 5% of GGRF funds. In 2014-15, LCTOP received $25
million, and in 2015-16 it was funded at $100 million.
Although, the Governor's January 2016-17 Budget proposed $100
million for the program, it is unclear what the funding level
will be for this year.
Specifically, LCTOP was created to provide operating and capital
assistance for transit agencies to reduce GHG emission and
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improve mobility, with a priority on serving disadvantaged
communities. Currently, approved projects in LCTOP support new
or expanded bus or rail services and expand intermodal transit
facilities and may include equipment acquisition, fueling,
maintenance, and other costs to operate those services or
facilities, with each project reducing GHG emissions. For
transit agencies whose service area includes disadvantaged
communities, at least 50% of the total moneys received shall be
expended on projects that will benefit disadvantaged
communities.
Currently, for operations, LCTOP supports only new and expanded
transit service that increase mode share - shift new riders out
of their cars - to reduce GHG emissions. Prior to receiving an
allocation, which is distributed by the State Controller
following the State Transit Assistance (STA) formula, eligible
transit agencies must submit a description of their proposed
expenditures and demonstrate how each expenditure will reduce
GHG emissions.
According to the author, this bill makes a few modest
adjustments to the existing LCTOP that will give transit
agencies more flexibility in how they spent the funds they
receive from the program.
More Flexibility: This bill contains numerous changes to the
LCTOP program, which give more flexibility to transit agencies
to utilize the funds. Specifically, this bill allows transit
agencies to use LCTOP funding to support new or expanded transit
service and continue funding the operation of that service in
subsequent years as long as the service continues to help reduce
GHGs. Additionally, this bill authorizes the use of a LONP so
that transit agencies can utilize their own resources to
initiate new or expanded service or commence a capital project
or expenditure and be reimbursed from their future formula share
of the program.
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Existing Practices: This bill also codifies numerous existing
practices in LCTOP. Specifically, this bill allows a transit
agency to "bank" their formula fund share, for no more than four
years, to save up sufficient funds to use for a larger
expenditure. Additionally, agencies that are not ready to move
forward can loan or transfer their LCTOP formula share to
another eligible agency in the region, or the transit agency can
reassign their funds to another eligible project and retain any
savings from a project for future eligible uses.
Please see the policy committee analysis for full discussion of
this bill.
Analysis Prepared by:
Melissa White / TRANS. / (916) 319-2093 FN:
0004361