BILL NUMBER: AB 1375	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Galgiani

                        FEBRUARY 27, 2009

   An act to repeal and add Division 19.5 (commencing with Section
185000) of the Public Utilities Code, relating to high-speed rail.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1375, as introduced, Galgiani. High-speed rail.
   Existing law, the California High-Speed Train Act, creates the
High-Speed Rail Authority to develop and implement a high-speed train
system in the state, with specified powers and duties. Existing law,
pursuant to the Safe, Reliable High-Speed Passenger Train Bond Act
for the 21st Century, approved by the voters as Proposition 1A at the
November 4, 2008, general election, provides for the issuance of
$9.95 billion in general obligation bonds for high-speed rail and
related purposes.
   This bill would revise and recast these provisions by repealing
and reenacting the California High-Speed Train Act. The bill would
continue the High-Speed Rail Authority in existence to make policy
decisions relative to implementation of high-speed rail consistent
with Proposition 1A. The bill would create the Department of
High-Speed Trains within the Business, Transportation and Housing
Agency, which would implement those policies. The bill would transfer
certain of the existing powers and responsibilities of the authority
to the department, and would specify additional powers and duties of
the authority and department relative to implementation of the
high-speed rail project, including the annual submission of a 6-year
high-speed train capital improvement program and progress report to
the Legislature. The director of the department would be appointed by
the authority, who would serve at the pleasure of the authority, and
the Governor would be authorized to appoint up to 10 executive
employees of the department who would be exempt from civil service
and serve at the pleasure of the director. The bill would provide for
acquisition and disposition by the department of rights-of-way for
the high-speed rail project. The bill would enact other related
provisions.
   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.  (a) It is the intent of the Legislature to do all of
the following:
   (1) Further the transportation system of the state through the
successful development and construction of the 800-mile high-speed
train system described in Proposition 1A, approved by the voters on
November 4, 2008.
   (2) Protect the state's interests and provide for the exercise of
continuing oversight of the funds to be invested in the high-speed
train project following voter approval of Proposition 1A.
   (3) Ensure that an adequate public forum maintains the
transparency of the development of the high-speed train project.
   (4) Provide an efficient governmental structure for the
development of high-speed train operations in the state.
   (b) This act continues in existence the High-Speed Rail Authority,
creates a new Department of High-Speed Trains within the Business,
Transportation and Housing Agency, apportions between the authority
and the new department existing as well as new powers, duties,
rights, and obligations, and defines the relationship between the
authority and the new department.
  SEC. 2.  Division 19.5 (commencing with Section 185000) of the
Public Utilities Code is repealed.
  SEC. 3.  Division 19.5 (commencing with Section 185000) is added to
the Public Utilities Code, to read:

      DIVISION 19.5.  CALIFORNIA HIGH-SPEED RAIL SERVICE


      CHAPTER 1.  GENERAL PROVISIONS, FINDINGS, AND DEFINITIONS


   185000.  This division shall be known, and may be cited, as the
California High-Speed Rail Act.
   185002.  The Legislature hereby finds and declares all of the
following:
   (a) California, over the past decades, has built an extensive
network of freeways and airports to meet the state's growing
transportation needs.
   (b) These facilities are not adequate to meet the mobility needs
of the current population.
   (c) The population of the state and the travel demands of its
citizens are expected to continue to grow at a rapid rate.
   (d) The cost of expanding the current network of highways and
airports fully to meet current and future transportation needs is
prohibitive, and a total expansion strategy would be detrimental to
air quality.
   (e) Intercity train service, when coordinated with urban transit
and airports, is an efficient, practical, and less polluting
transportation mode that can fill the gap between future demand and
present capacity.
   (f) Advances in rail and train technologies have allowed intercity
train systems in Europe and Japan to attain speeds of up to 220
miles per hour and compete effectively with air travel for trips in
the 200- to 500-mile range.
   (g) Development of a high-speed train system is a necessary and
viable alternative to automobile and air travel in the state.
   (h) In order for the state to have a comprehensive network of
high-speed intercity train systems by the year 2020, similar to
California's former freeway plan, it is necessary to designate an
entity with stable and predictable funding sources to implement the
plan.
   (i) Utilizing existing human and manufacturing resources to build
a large network of high-speed trains will generate jobs and economic
growth for today's population and produce a transportation network
for future generations.
   (j) Upon confirmation of the need and costs by detailed studies,
the private sector, together with the state, can build and operate
new high-speed intercity train systems utilizing private and public
financing.
   185004.  As used in this division, unless the context requires
otherwise, the following terms have the following meanings:
   (a) "Authority" means the High-Speed Rail Authority. The members
of the authority constitute the board of the authority.
   (b) "Department" means the Department of High-Speed Trains.
   (c) "High-speed train" means intercity passenger train service
that utilizes an alignment and technology that makes it capable of
sustained speeds of 200 miles per hour or greater.
   (d) "Secretary" means the Secretary of Business, Transportation
and Housing.
      CHAPTER 2.  THE HIGH-SPEED RAIL AUTHORITY



      Article 1.  Members of the Authority


   185110.  (a) The High-Speed Rail Authority in state government is
hereby continued in existence.
   (b) (1) The authority is composed of nine members as follows:
   (A) Five members appointed by the Governor.
   (B) Two members appointed by the Senate Committee on Rules.
   (C) Two members appointed by the Speaker of the Assembly.
   (2) For the purposes of making appointments to the authority, the
Governor, the Senate Committee on Rules, and the Speaker of the
Assembly shall take into consideration geographical diversity to
ensure that all regions of the state are adequately represented.
   (c) Members of the authority shall hold office for terms of four
years, and until their successors are appointed. A vacancy shall be
filled by the appointing power making the original appointment, by
appointing a member to serve the remainder of the term.
   (d) The term of a member shall expire on December 31 of the fourth
year of the member's term.
   (e) Members of the authority are subject to the Political Reform
Act of 1974 (Title 9 (commencing with Section 81000)).
   (f) From among its members, the authority shall elect a
chairperson, who shall preside at all meetings of the authority, and
a vice chairperson to preside in the absence of the chairperson. The
chairperson shall serve a term of one year.
   (g) Five members of the authority constitute a quorum for taking
any action by the authority.
   185112.  (a) Each member of the authority shall receive
compensation of one hundred dollars ($100) for each day that the
member is attending to the business of the authority, but shall not
receive more than five hundred dollars ($500) in any calendar month.
   (b) Members of the authority shall be reimbursed for their actual
travel expenses incurred in attending to the business of the
authority.
   185114.  (a) The authority shall appoint the director of the
department, who shall also serve as the authority's executive
director, who shall serve at the pleasure of the authority, to
administer the affairs of the authority and of the department.
   (b) The director is exempt from civil service.
   (c) The director may appoint necessary staff to carry out the
provisions of this division.

      Article 2.  Policies of the Authority


   185120.  In consultation with the department, the authority shall
establish policies directing the development and implementation of
intercity high-speed train service that is fully integrated with the
state's existing intercity rail and bus network, consisting of
interlinked conventional and high-speed train lines and associated
feeder buses. The intercity network in turn shall be fully
coordinated and connected with commuter train lines and urban transit
lines developed by local agencies, as well as other transit
services, through the use of common station facilities whenever
possible. The department shall implement those policies.
   185122.  (a) The authority shall establish an independent peer
review group for the purpose of reviewing the planning, engineering,
financing, and other elements of the authority's plans and issuing an
analysis of appropriateness and accuracy of the authority's
assumptions and an analysis of the viability of the authority's
financing plan, including the funding plan for each corridor required
pursuant to subdivision (b) of Section 2704.08 of the Streets and
Highways Code.
   (b) The peer review group shall include all of the following:
   (1) Two individuals with experience in the construction or
operation of high-speed trains in Europe, Asia, or both, designated
by the Treasurer.
   (2) Two individuals, one with experience in engineering and
construction of high-speed trains and one with experience in project
finance, designated by the Controller.
   (3) One representative from a financial services or financial
consulting firm who shall not have been a contractor or subcontractor
of the authority for the previous three years, designated by the
Director of Finance.
   (4) One representative with experience in environmental planning,
designated by the secretary.
   (5) Two expert representatives from agencies providing intercity
or commuter passenger train services in California, designated by the
secretary.
   (c) The peer review group shall evaluate the authority's funding
plans and prepare its independent judgment as to the feasibility and
reasonableness of the plans, appropriateness of assumptions,
analyses, and estimates, and any other observations or evaluations it
deems necessary.
   (d) The authority and the department shall provide the peer review
group any and all information that the peer review group may request
to carry out its responsibilities.
   (e) The peer review group shall report its findings and
conclusions to the Legislature no later than 60 days after receiving
the plans.

      Article 3.  Powers, Duties, and Responsibilities of the
Authority


   185130.  The authority has those powers, duties, and
responsibilities delegated to it pursuant to the Safe, Reliable
High-Speed Passenger Train Bond Act of 2008 (Chapter 20 (commencing
with Section 2704) of Division 3 of the Streets and Highways Code).
In addition, and subject to those powers, duties, and
responsibilities, the authority has the following powers, duties, and
responsibilities:
   (a) The authority shall select the routes of the high-speed train
system.
   (b) The authority shall determine the priority of construction of
the various segments of the high-speed train system.
   (c) The authority shall serve as the governing body of the
department, within the meaning of Section 1245.210 of the Code of
Civil Procedure, for purposes of the adoption of resolutions of
necessity.
   (d) The authority shall advise the secretary and the director
concerning high-speed rail matters.
   (e) The authority shall adopt criteria for the award of
franchises.
   (f) The authority shall set fares or establish guidelines for the
setting of fares.
   185132.  (a) The authority shall adopt and submit to the
Legislature and the Governor, not later than October 1 each year, a
high-speed train program. The program shall cover a period of six
fiscal years, beginning July 1 of the year following the year it is
adopted, and shall be a statement of intent by the department to
request funding in the annual Budget Act for the following six years.

   (b) The high-speed train program shall include a listing of all
capital improvement projects that are expected to require
appropriation in the annual Budget Act, including state, federal,
local, and private funds, during the following six fiscal years.
   (c) For each segment, the program shall specify the expenditure
amount and the expenditure year for each of the following project
components:
   (1) Completion of all permits and environmental studies.
   (2) Preparation of plans, specifications, and estimates.
   (3) The acquisition of rights-of-way, including, but not limited
to, support activities.
   (4) Construction and construction management and engineering,
including surveys and inspection.
      CHAPTER 3.  DEPARTMENT OF HIGH-SPEED TRAINS



      Article 1.  Organization of the Department


   185210.  There is in the Business, Transportation and Housing
Agency a Department of High-Speed Trains.
   185211.  The department is under the control of a director known
as the Director of High-Speed Trains.
   185212.  The director shall be appointed by the authority, and
hold office at the pleasure of the authority as provided in Section
185114.
   185213.  The director shall perform all duties, exercise all
powers and jurisdiction, assume and discharge all responsibilities,
and carry out and effect all purposes vested by law in the
department, except as otherwise expressly provided by law.
   185214.  The director shall organize the department from time to
time in the manner the director deems necessary to properly segregate
and conduct the work of the department. The director may organize
the department into as many divisions as, in the director's judgment,
will provide for the efficient administration of the high-speed
train project and planning, construction, and operation of the
high-speed train system.
   185215.  (a) For purposes of overseeing the ongoing work of the
department, the organization of the department may include provision
for up to 10 employees exempt from civil service who shall constitute
the executive staff of the department, who shall be appointed by the
Governor, and who shall serve at the pleasure of the director.
   (b) Notwithstanding Sections 19816 and 19825 of the Government
Code, the compensation of key exempt management, including the
director and the exempt positions described in subdivision (a), shall
be established by the authority board in amounts that are reasonably
necessary, in the discretion of the board, to attract and hold a
person of superior qualifications.
   (c) (1) To determine the compensation for the positions described
in this section, the authority shall cause to be conducted, through
the use of independent outside advisors, salary surveys of both of
the following:
   (A) Other state, regional, and local transportation agencies that
are most comparable to the department.
   (B) Other relevant labor pools.
   (2) The salaries so set by the board shall not exceed the highest
comparable salary for a position of that type, as determined by the
survey.
   (d) The Department of Personnel Administration shall review the
methodology used in these salary surveys.
   185216.  The Governor, the secretary, and the department may enter
into any agreements, execute any documents, establish and manage any
accounts and deposits, and take any other action that may be
appropriate, in accordance with federal law and rules and
regulations, to receive and expend funds from the federal government
in connection with mass transportation programs and projects for
which federal funds are available.
   185217.  The department shall prepare and submit to the
Legislature and to the authority board an annual report, no later
than December 1 of each year. The report shall include a description
of the progress made and the high-speed train program adopted by the
authority.
   185218.  (a) The authorization and responsibility for planning,
construction, and operation of high-speed passenger train service at
speeds exceeding 125 miles per hour in this state is exclusively
granted to the department.
   (b) Except as provided in paragraph (a), nothing in this chapter
precludes other local, regional, or state agencies from exercising
powers provided by law with regard to planning or operating, or both,
passenger rail service.

      Article 2.  Powers and Duties of the Department


   185220.  Subject to the other provisions of this division, and the
provisions of the Safe, Reliable High-Speed Passenger Train Bond Act
of 2008 (Chapter 20 (commencing with Section 2704) of Division 3 of
the Streets and Highways Code), the department shall have the powers
and duties to do the following:
   (a) Conduct engineering and other studies related to the selection
and acquisition of rights-of-way and the selection of a franchisee,
including, but not limited to, environmental impact studies,
socioeconomic impact studies, and financial feasibility studies.
   (b) Evaluate alternative high-speed train technologies, systems
and operators, and select an appropriate high-speed train system.
   (c) Award franchises consistent with criteria adopted by the
authority.
   (d) Accept grants, fees, and allocations from the state, from
political subdivisions of the state, or from the federal government,
foreign governments, and private sources.
   (e) Select a proposed franchisee, a proposed route, and proposed
terminal sites.
   (f) Enter into contracts with public and private entities for the
preparation of the plan.
   (g) Prepare a detailed financing plan, including any necessary
taxes, fees, or bonds to pay for the construction of the high-speed
train network.
   (h) Develop a proposed high-speed train financial plan, including
necessary taxes, bonds, or both, or other indebtedness, and submit
the plan to the Legislature and to the Governor.
   (i) Keep the public informed of its activities.
   (j) Enter into contracts with private or public entities,
including contracts for the design, construction, and operation of
high-speed trains. The contracts may be separated into individual
tasks or segments or may include all tasks and segments, including
any combination of one or more of such tasks as design, build,
finance, operate, and maintain.
   (k) Acquire rights-of-way through purchase or eminent domain.
   (l) Subject to approval by the authority board, issue debt,
secured by pledges of state funds, federal grants, or project
revenues. The pledge of state funds shall be limited to those funds
expressly authorized by statute or voter-approved initiatives.
   (m) Enter into cooperative or joint development agreements with
local governments or private entities.
   (n) Relocate highways and utilities.
   (o) Plan, construct, and operate the high-speed train system, or
enter into contracts for the planning, construction, or operation of
the system, including the acquisition of equipment, including rolling
stock, necessary for the operation of the system.
   (p) Acquire, sell, and lease passenger rail rolling stock, power
units, and associated equipment.
   (q) Acquire, lease, design, construct, and improve track lines and
related facilities, and contract with the private sector for the
design, improvement, or construction of track lines and related
facilities.
   185222.  (a) Notwithstanding any other provision of law, and
subject to approval by the authority board, for any project along the
high-speed rail network, the department may contract with the
Department of Transportation to perform project design and
engineering services, including construction inspection services.
   (b) For purposes of this section, "project design and engineering
services, including construction inspection services" means
preliminary engineering, planning, prebid services, right-of-way
acquisitions, preparation of environmental documents, preparation of
plans, specifications, and estimates, construction inspection
including surveying and materials testing, quality control inspection
including highway and utility relocation, and grade separations.

      Article 3.  Rights-of-Way


   185230.  (a) If the department determines that real property or an
interest therein, previously or hereafter acquired by the state for
high-speed rail purposes, is no longer necessary for those purposes,
the department may sell, contract to sell, sell by trust deed, or
exchange the real property or interest therein in the manner and upon
terms, standards, and conditions established by the authority. The
payment period in a contract of sale or sale by trust deed shall not
extend longer than 10 years from the time the contract of sale or
trust deed is executed, and a transaction involving a contract of
sale or sale by trust deed to private parties shall require a
downpayment of at least 30 percent of the purchase price.
   (b) A conveyance under this section shall be approved by the
authority and shall be executed on behalf of the state by the
director and the purchase price shall be paid into the State Treasury
to the credit of any fund, available to the department for
high-speed rail purposes, that the authority designates.
   (c) Any real property or interest therein may in like manner be
exchanged, either as whole or part consideration, for any other real
property or interest therein as needed for high-speed rail purposes.
   185232.  The director may sell or lease excess right-of-way
parcels to municipalities or other local agencies for public
purposes, and may accept as all or part of the consideration for the
sale or lease any substantial benefits the state will derive from the
municipality or other local agency's undertaking maintenance or
landscaping costs that would otherwise be the obligation of the
state.
   185234.  The director may lease nonoperating right-of-way areas to
municipalities or other local agencies for public purposes, and may
contribute toward the cost of developing local parks and other
recreational facilities on those areas. The director may accept as
all or part of the consideration for the lease or for the state
contribution any substantial benefits the state will derive from the
municipality or other local agency's undertaking maintenance or
landscaping costs that would otherwise be the obligation of the
state. Those leases shall contain a provision that whenever the
leased land is needed for high-speed rail operating purposes the
lease shall terminate. The department is authorized to classify
portions of high-speed rail rights-of-way as nonoperating.
   185236.  (a) The department may acquire, by purchase, lease, or
eminent domain, any property necessary for the development and
implementation of the state's high-speed train program. The power of
eminent domain shall be exercised in accordance with Title 7
(commencing with Section 1230.010) of Part 3 of the Code of Civil
Procedure.
   (b) The authority constitutes the department's "governing body"
within the meaning of Section 1245.210 of the Code of Civil
Procedure, for purposes of the adoption of resolutions of necessity.
   (c) To the extent that the activities authorized by subdivision
(a) exceed the capacity of the department's existing work force, the
department may contract with qualified individuals or firms for
engineering, surveying, and related technical services in exercising
its authority pursuant to subdivision (a).
      CHAPTER 4.  LEGAL MATTERS


   185300.  The department may employ its own legal staff or contract
with other state agencies for legal services, or both. The
department's legal counsel may represent the authority and the
department in any judicial proceeding.
   185302.  Any legal or equitable action brought against the
authority or the department shall be brought in a court of competent
jurisdiction in the County of Sacramento. For purposes of this
section, subdivision (1) of Section 401 of the Code of Civil
Procedure does not apply.