BILL ANALYSIS
CONFERENCE REPORT COMMITTEE ANALYSIS
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Bill No: SB 457
Author: Kelley
RN: 96 22984
Report date: 7/2/96
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SUBJECT: Intercity Passenger Rail
Were the Conference amendments heard (*) in committee?
Yes
If yes, were they defeated? No
SUMMARY: This bill declares that intercity passenger
rail is an important element of the transportation system
and it is the responsibility of the state to plan and fund
the program. It designates the Secretary of Business,
Transportation and Housing Agency as the person responsible
for implementing the program and service. It also
authorizes the secretary to transfer the administration of
the service to specific joint powers entities through
contractual agreements and specifies the terms and
conditions of those agreements.
The bill would authorize the creation of three joint powers
boards: one in Southern California, one in the San Joaquin
Valley and one for the Capital Corridor.
By: Senate Transportation Committee/ M. Morshed
*See Senate Rule 29.6 (b) for definition of oheardo.
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SENATE RULES COMMITTEE SB 457
Office of Senate Floor Analyses
1020 N Street, Suite 524
(916) 445-6614 Fax: (916) 327-4478
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CONFERENCE COMPLETED
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Bill No: SB 457
Author: Kelley (R), et al
Amended: Conference Report No. 1, 7/2/96
Vote: 27 - Urgency
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ALL PRIOR VOTES: Not Relevant
CONFERENCE COMMITTEE VOTE: 5-0, 7/2/96
AYES: Senators Kelley and Kopp; Assembly Members Brewer,
Hannigan, Bowler
ASSEMBLY FLOOR: Not Relevant
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SUBJECT: Transportation: intercity passenger rail
service
SOURCE: Author
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DIGEST: As this bill passed the Senate and Assembly it
required the California Transportation Commission to
conduct a public hearing on any request for extension of
the existing three-year period which a new rail service
must maintain a ratio of fare revenues to avoidable costs.
Conference Committee Amendments delete the provisions of
the bill and instead enact the Intercity Passenger Rail Act
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of 1996 which makes changes in the Southern California
Regional Rail Authority, allows Caltrans to enter into
intercity transfer agreements with specified joint exercise
of powers entities, incorporates SB 1710 (Costa) relating
to the San Joaquin Corridor and AB 1720 Hannigan) relating
to the Capitol Corridor. SB 1710 passed the Senate 34-0
and is presently in Assembly Local Government Committee and
AB 1720 passed Senate Transportation Committee 8-1 (No:
Monteith) and is in Senate Appropriations Committee.
ANALYSIS:
I. General Overview of the Bill
Under existing law, an intercity rail service receiving
specified state funding is eligible to continue to receive
those funds only if it maintains a ratio of fare revenues
to avoidable costs of at least 55%. In order to receive
state funding, a commuter rail service is required to
maintain a ratio of fare revenues to avoidable costs of at
least 40%. The California Transportation Commission, at
the request of the Department of Transportation, may waive
those requirements for up to three years.
This bill would delete those provisions and would authorize
the department, upon approval of the Secretary of Business,
Transportation and Housing, to enter into interagency
transfer agreements with specified joint exercise of powers
entities, pursuant to which the respective joint powers
entity would assume responsibility for intercity passenger
rail services within a particular corridor, and be
allocated funds for that purpose pursuant to the agreement.
The transfer of funds would constitute an appropriation.
The bill would specify various terms to be included in the
agreement. A business plan, as specified, would be
required to be prepared for the provision of intercity
passenger rail services pursuant to an interagency transfer
agreement.
The bill would authorize expansion of the membership of the
Southern California Regional Rail Authority, an existing
joint exercise of powers entity formed to operate the
commuter rail network known as Metrolink, for the purpose
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of administering intercity rail services in 10 specified
southern California counties.
This bill would create the Capitol Corridor Joint Powers
Board, subject to being organized, as provided, specify its
membership, prescribe its functions and responsibilities,
and authorize the board to enter into an interagency
agreement with the department to assume responsibility for
Capitol Corridor intercity rail services. The board would
be organized when two jurisdictions elect to appoint
members to the board and only those jurisdictions that
appoint members to the board prior to December 31, 1996,
would be member-agencies of the board.
The bill would authorize specified local agencies to form a
joint exercise of powers board for the purpose of assuming
responsibility for intercity rail passenger services in the
San Joaquin Corridor.
II. Intercity Passenger Rail Service: Funding
Availability and Agreements
The bill would require the Secretary of Business,
Transportation and Housing to establish, through an annual
budget process, the level of state funding available for
the operation of intercity passenger rail service in each
corridor.
Where applicable, operating funds would be allocated by the
secretary to the joint powers board in accordance with an
interagency agreement which includes mutually agreed-upon
rail services. Funds for the administration and marketing
of services, as appropriate, would also be transferred by
the secretary to the joint powers board, subject to the
terms of the interagency agreement.
This bill would authorize the joint powers board or local
or regional entities to augment state-provided resources to
expand intercity passenger rail services, or to address
funding shortfalls in achieving agreed-upon performance
standards.
The department may provide any support services as may be
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mutually agreed upon by the board and the department.
The bill requires that operating costs be controlled by
dealing with, at a minimum, the current Amtrak cost
allocation formula and the ability to contract out to
Amtrak or other rail operators as a part of federal
legislation dealing with Amtrak reauthorization.
The bill would require the secretary, not later than
December 31, 1997, to establish a set of uniform
performance standards for all corridors and operators to
control cost and improve efficiency.
The bill defines "board" or "joint powers board" to mean
the governing board of a joint exercise of powers agency
for the purpose of assuming administrative responsibility
for intercity passenger rail service within the respective
corridor.
"Secretary" means the Secretary of the Business,
Transportation and Housing Agency.
If authorized by the secretary, the Department of
Transportation may, through an interagency agreement,
transfer to a joint powers board, and the board may assume,
all responsibility for administering passenger rail service
in the corridor. Upon the date specified in the agreement,
the board shall succeed to the department's powers and
duties relative to that service, except that the department
shall retain responsibility for developing budget requests
for the service through the state budget process, which
shall be developed in consultation with the board, and for
coordinating service in the corridor with other passenger
rail services in the state.
The interagency agreement shall be executed on or before
December 31, 1996. If an interagency agreement is not
entered into on or before December 31, 1996, the secretary
shall provide a report to the Governor and the Legislature
on or before January 30, 1997, explaining why an acceptable
agreement has not been developed, with specific
recommendations for developing an acceptable interagency
agreement.
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The bill provides that the department and any entity that
assumes administrative responsibility for passenger rail
services through an interagency transfer agreement, may,
through a competitive bid process, contract with the
National Railroad Passenger Corporation (Amtrak) or with
other organizations authorized under state or federal law
to provide passenger rail services, and may contract with
rail corporations and other rail operators for the use of
tracks and other facilities and for the provision of
passenger services on terms and conditions as the parties
may agree. The department is deemed to be a third-party
beneficiary of the contract, and the contract shall not
contain any provision or condition that would negatively
impact on or conflict with any other contracts the
department has regarding intercity rail services. Any
entity that succeeds the department as sponsor of
state-supported passenger rail services through an
interagency transfer agreement, is deemed an agency of the
state for all purposes related to passenger rail services,
including Section 1614 of Title 49 of the United States
Code.
III. Southern California Regional Rail Authority
The bill provides that the Southern California Regional
Rail Authority is an existing joint powers authority made
up of the county transportation commissions of the Counties
of Los Angeles, Orange, Riverside, San Bernardino, and
Ventura, and set up to operate the commuter rail network
known as Metrolink in those counties.
The bill further provides that the joint powers authority,
known as the Southern California Regional Rail Authority,
may, if the authority elects to be a party to an
interagency agreement be expanded to form an authority for
the administration of intercity passenger rail services in
the Counties of Imperial, Los Angeles, Orange, Riverside,
San Bernardino, San Diego, San Luis Obispo, Santa Barbara,
and Ventura. The expanded authority may include, but is
not limited to, the following agencies: the Imperial
Valley Association of Governments, the Los Angeles County
Metropolitan Transportation Commission, the Orange County
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Transportation Authority, the Riverside County
Transportation Commission, the San Bernardino Association
of Governments, the San Diego Association of Governments,
the San Luis Obispo Council of Governments, the Santa
Barbara County Association of Governments, and the Ventura
County Transportation Commission.
For the above purpose, the bill defines "authority" to mean
the expanded board of the Southern California Regional Rail
Authority. Only the expanded board or authority, not the
Southern California Regional Rail Authority board existing
on July 1, 1996, may exercise jurisdiction over intercity
rail matters for the service area of the authority. For
purposes of taking action on intercity rail issues,
including, but not limited to, equipment, funding,
legislation, marketing, and operations, the member agency
from each county shall be allowed one vote. Representation
shall be limited to one agency per county.
The membership of the expanded Southern California Regional
Rail Authority shall be one voting representative from each
of the designated member agencies. Members shall be
appointed from each of the member agencies annually.
IV. San Joaquin Corridor
The "San Joaquin Corridor" or "corridor" means the Los
Angeles-Bakersfield-Fresno-Stockton-Sacramento-Oakland rail
corridor.
The bill allows the establishment of the San Joaquin
Corridor Joint Powers Agency by agreement of the
represented agencies for the purpose of assuming
responsibility for intercity passenger rail services in the
San Joaquin Corridor.
The governing board is to be composed of the following 19
members:
1.One member from the Capitol Corridor Joint Powers Board,
if that board is in existence.
2.One member from the County of Sacramento, appointed by
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the board of supervisors of that county.
3.One member from the County of Los Angeles, appointed by
the board of supervisors of that county.
4.Two members each from the Counties of Fresno, Kern,
Kings, Madera, Merced, San Joaquin, Stanislaus, and
Tulare, appointed by the board of supervisors of the
respective county. Each county shall appoint one member
who is an elected official and one who is a private
citizen.
V. Capitol Corridor
Senate Transportation Committee analysis indicates:
The Capitol Corridor service began in December, 1991.
Ridership has consistently grown, and expansion of the
intercity service, as well as initiation of local commuter
service, is needed. However, improvements are needed to
increase speed and improve access.
Rail passenger bond funds of over $56 million are available
for capital improvements. The California Transportation
Commission has, as a condition of approving capital funds,
required that a firm commitment for future use rights be
given by the right-of-way owner, the Southern Pacific
Railroad (SP). Negotiations with SP have stalled.
Obtaining such a commitment is in the state's best
interests, since public funds will be used to improve
privately- owned property.
As "administrator", the department has been criticized for
failing to properly market passenger service, coordinate
with local transit operators and involve local agencies
along the route in decision-making. A recent announcement
by Amtrak, the intercity rail operator, that service funded
by Amtrak will be reduced due to the reduction of federal
Amtrak subsidies has further exacerbated the problem.
The "Capitol Corridor" or "corridor" under SB 457 is to
mean the Colfax-Sacramento-Suisun City-Oakland-San Jose
rail corridor.
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The bill creates the Capitol Corridor Joint Powers Board.
The board would be composed of not more than the following
16 members:
1.Six members of the San Francisco Bay Area Rapid Transit
District Board of Directors, appointed by the board of
directors of that district, as follows:
A.Two who are residents of Alameda County.
B.Two who are residents of Contra Costa County.
C.Two who are residents of the City and County of San
Francisco.
2.Two members of the Board of Directors of the Sacramento
Regional Transit District, appointed by the board of
directors of that district.
3.Two members of the Board of Directors of the Santa Clara
County Transit District, appointed by the board of
directors of that district.
4.Two members of the county congestion management agency
for that County of Yolo, appointed by that agency.
5.Two members of the county congestion management agency
for the County of Solano, appointed by that agency.
6.Two members of the Placer County Transportation Planning
Agency, appointed by that agency.
Finally, the bill provides that if the board and the
department enter into an interagency transfer agreement for
an initial period, that begins with the transfer of
responsibilities from the department to the board and
continues for a three-year period subsequent to the
completion of the track and signal improvements between
Sacramento and Emeryville, the San Francisco Bay Area Rapid
Transit District General Manager and the district's
administrative staff shall, if that district has appointed
members to the board as specified, provide all necessary
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administrative support to the board to perform its duties
and responsibilities, and may perform for the board any and
all activities that they are authorized to perform for the
district. At the conclusion of the initial period, the
board may, through procedures that it determines, select
the San Francisco Bay Area Rapid Transit District or
another existing public rail transit agency for a
three-year term to provide all necessary administrative
support staff to the board to perform its duties and
responsibilities.
The bill requires the board to make its decisions in
accordance with the votes of its members, requiring a
majority vote for all matters with the exception of the
approval of the business plan, and revisions, which shall
require a vote of two-thirds of the members.
For the purpose of carrying out its responsibilities the
board may seek funds from any jurisdiction served by the
Capitols passenger rail service for enhanced service.
FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes
Local: No
SUPPORT: (Verified 7/3/96)
Southern California Regional Rail Authority (METROLINK)
Riverside County Transportation Commission
San Bernardino Associated Governments
Orange County Transportation Authority
City of Palm Springs
Bay Area Rapid Transit System (BART)
Metropolitan Transportation Commission (MTC)
Counties of Alameda, Contra Costa, Riverside and Solano
AMTRAK
OPPOSITION: (Verified 7/3/96)
Board of Supervisors, County of Sacramento
Ventura County
Board of Supervisors, County of Madera
Planning and Conservation League
Train Riders Association of California
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Modern Transit Society
Caltrans Rail Task Force
Supervisor Joe Hammond, Kings County
California State Employees Association
Los Angeles County Metropolitan Transportation Authority
Los Angeles-San Diego Rail Corridor Agency
ARGUMENTS IN SUPPORT: Proponents argue that this bill:
1. Codifies a statewide rail policy that has legislative
and local acceptance, and provides a framework for future
long-term planning.
2. Maintains an administration commitment through
continued agency involvement and oversight to support
multimodal transportation systems.
3. Gives local entities a greater level of control, and
establishes multi-county JPAs that will increase consumer
confidence and local political acceptance of the service.
This will also encourage additional local investments
beyond what can be provided by the state.
4. Allows local control by giving the JPAs ownership of
management decisions made based on local priorities.
This proposal puts those market specific decisions
closest to the market they hope to service.
5. Downsizing the Caltrans Division of Rail from an
operational-type organization to a small cadre of policy,
planning, and audit staff will yield savings that can be
used for increased rail service. This is consistent with
the agency's back-to-basics theme and the Governor's
leadership to downsize state government.
6. Creates a competitive environment for the delivery of
passenger rail services. JPAs would be required to
select the service operator through competitive bid.
This allows regional, federal, and private entities to
potentially operate the service.
7. In the event an existing commuter rail wins the
competitive bid, some efficiencies may be obtained
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through shared use of rolling stock, maintenance
facilities, railways, station operation, administration,
marketing, or other areas. The exact synergism provided
by joint operation is difficult to predict, but
potentially substantial. Competitive bidding should
permit those operating efficiencies to be determined,
quantified and realized.
The bill contains a uniform approach to the delegation of
authority for management of intercity rail programs that
will ensure that such programs are better managed in the
future through increased coordination with local rail and
bus operation while at the same time charging the Secretary
of BT&H Agency with the responsibility and authority for
the coordination of the three intercity rail corridors with
one another.
Under SB 457 the Governor and Legislature would retain
current budgetary control over the size and character of
the intercity rail program through the normal State Budget
process.
The quality of Caltrans management of the intercity rail
service over the last several years has been abysmal by all
counts, whether one considers poor marketing, scheduling,
coordination with local transportation services, operating
cost controls, excessive overhead costs, etc. The Bay Area
Rapid Transit System (BART) in the Bay Area and METROLINK
in Southern California already possess a great deal more of
experience planning operating, and marketing rail transit
services than Caltrans.
It is anticipated that local management of the service will
bring a great deal more local support and overall
enthusiasm for the promotion of the intercity rail service
in local communities throughout the three corridors.
ARGUMENTS IN OPPOSITION: The Board of Supervisors of
Sacramento state that, "As a supporter of Proposition 116,
which provided the funding to establish the Capitol
Corridor service, we are vitally interested in seeing rail
passenger service on this corridor maintained and enhanced.
In addition, we share some of the same frustrations of the
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proponents with the actions of Caltrans, the Business
Transportation and Housing Agency, and the California
Transportation Commission which have prevented this service
from reaching its potential. Furthermore, I acknowledge
that it would be desirable for local interests to play a
larger role providing this services.
"However, through a recent meeting with the Secretary of
Business, Transportation and Housing and recent amendments
to this bill, it has become increasingly clear that the
state wishes to pass on not only the responsibility of
administering this service, but the costs of funding it as
well.
"Currently, state supported intercity rail service in
California enjoys a secure source of operating funds.
These funds are "taken off the top" of the Transportation
Planning and Development Account--a fund permanently
protected by Proposition 116 as a trust fund for mass
transportation purposes. As long as intercity rail remains
a state responsibility, this long and bipartisan supported
funding tradition is likely to continue.
"However, if responsibility for intercity service were to
be shifted to local entities, it is virtually certain that
members of the Legislature would question why the state is
funding what would be viewed as regional commuter rail
services.
"In fact, the history is clear. When the state divested
itself of CalTrain and shifted responsibility for that
passenger rail service to a local joint powers board, state
funding was completely eliminated!
"More recently, when the state shifted responsibility for
ridesharing to local entities, it also proposed to
eliminate the funding. After a great hue and cry, the
complete funding cutoff was modified to a mere drastic
cutback. It is clear that this program will have to endure
continued cutbacks in future years.
"Despite all of SB 457's good intentions, nothing in that
bill can bind the budgetary decisions of future
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legislatures. And the attitudes of the Legislature and the
Governor are becoming ever more clear on these matters.
The state trend of providing local government more
responsibilities, but less funding to meet those
responsibilities continues."
ASSEMBLY FLOOR:
AYES: Aguiar, Alby, Alpert, Archie-Hudson, Baca, Baldwin,
Battin, Boland, Bordonaro, Bowen, Bowler, Brewer, V.
Brown, W. Brown, Brulte, Burton, Bustamante, Cannella,
Conroy, Cortese, Cunneen, Davis, Ducheny, Escutia,
Figueroa, Firestone, Friedman, Frusetta, Gallegos,
Goldsmith, Granlund, Harvey, Hauser, Hawkins, Hoge,
House, Isenberg, Kaloogian, Katz, Knight, Knox, Kuehl,
Kuykendall, Machado, Margett, Martinez, Mazzoni,
McDonald, McPherson, Miller, Morrissey, Morrow, W.
Murray, Napolitano, Olberg, Poochigian, Pringle, Rainey,
Rogan, Setencich, Sher, Speier, Sweeney, Takasugi,
Thompson, Tucker, Vasconcellos, Villaraigosa, Weggeland,
Woods, Allen
NOES: Bates, Campbell, Hannigan, Lee
NOT VOTING: Caldera, Knowles, K. Murray, Richter
RJG:sl 7/5/96 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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