BILL ANALYSIS
AB 2121
Page 1
ASSEMBLY THIRD READING
AB 2121 (Harkey and Galgiani)
As Amended May 28, 2010
Majority vote
TRANSPORTATION 13-0 APPROPRIATIONS 17-0
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|Ayes:|Bonnie Lowenthal, |Ayes:|Fuentes, Conway, Ammiano, |
| |Jeffries, | |Bradford, Charles |
| |Bill Berryhill, | |Calderon, Coto, Davis, |
| |Blumenfield, Buchanan, | |Monning, Ruskin, Harkey, |
| |Eng, Furutani, Galgiani, | |Miller, Nielsen, Norby, |
| |Hayashi, Miller, Niello, | |Skinner, Solorio, |
| |Norby, Solorio | |Torlakson, Torrico |
| | | | |
|-----+--------------------------+-----+--------------------------|
| | | | |
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SUMMARY : Requires the California High-Speed Rail Authority
(Authority) to submit annually a six-year funding program and a
project progress report to the appropriate policy and budget
committees of the Legislature. Specifically, this bill :
1)Requires the Authority to submit to the appropriate policy and
budget committees of the Legislature, not later than October 1
each year, a high-speed train program (program) covering a
period of six fiscal years, beginning July 1 of the year
following the year it is adopted. The program is to
constitute the Authority's intended funding request in the
annual Budget Act for the following six years. The program is
to 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. For
each high-speed rail segment, the program is to specify the
expenditure amount and the expenditure year for each of the
following project components:
a) Completion of all permits and environmental studies;
b) Preparation of plans, specifications, and estimates;
c) The acquisition of rights-of-way, including, but not
limited to, support activities; and,
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d) Construction and construction management and
engineering, including surveys and inspection.
2)Requires the Authority to prepare and submit to the
appropriate policy and budget committees of the Legislature,
an annual project progress report, no later than December 1 of
each year. The report is to include the following:
a) A description of the progress made for each project
within each high-speed train segment;
b) The baseline budget for support and capital outlay
construction costs for each segment;
c) The current or projected program budget for support and
capital outlay construction costs for each segment;
d) Expenditures to date for support and capital outlay
construction costs for each segment;
e) A comparison of the current or projected schedule and
the baseline schedule;
f) A summary of milestones achieved for each segment during
the annual period and any issues identified and actions
taken to address those issues; and,
g) A detailed financing plan, including any necessary
taxes, fees, bonds, or other indebtedness to pay for the
construction of the high-speed train network.
EXISTING FEDERAL LAW authorizes, through enactment of the
federal American Recovery and Reinvestment Act of 2009 (the
recently enacted federal economic stimulus package referred to
as "ARRA"), $2.25 billion for high-speed rail passenger service
development in California.
EXISTING STATE LAW :
1)Establishes and provides the Authority with the responsibility
and authority to develop and implement a high-speed train
system within California.
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2)Provides, pursuant to Proposition 1A, or the Safe, Reliable
High-Speed Passenger Train Bond Act for the 21st Century, as
approved by the statewide voters at the November 2008 general
election, $9.95 billion in general obligation bond authority
to fund the planning and construction of a high-speed
passenger train system and complementary improvements to other
specified rail systems in the state.
3)Authorizes the Legislature to establish conditions and
criteria on funds appropriated for planning and capital costs;
requires Authority, prior to expending bond funding for the
construction and acquisition of equipment and property, to
submit concurrently to Department of Finance and the Joint
Legislative Budget Committee a detailed funding plan for each
corridor or usable segment.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, special fund cost for both reports would total in the
range of $150,000 to $200,000 in the first year. Annually, cost
to update the reports would be around $100,000.
COMMENTS : The proposed California high-speed rail passenger
train network consists of an 800+ mile high-speed system capable
of a speed up to 220 miles per hour (mph), initially serving the
major metropolitan market of San Francisco through the Central
Valley into Los Angeles and Orange County (Phase 1). The system
is required by statute to transport people from San Francisco to
Los Angeles in two hours and forty minutes. Eventually the
service would be extended to Sacramento, the Inland Empire, and
San Diego. Further, improved rail service over the Altamont
corridor would be implemented.
AB 3034 (Galgiani) Chapter 267, Statutes of 2008, lays the
framework for improving the oversight of the Authority's
high-speed rail project. That bill also clarifies and modifies
bond provisions that eventually were approved by the California
voters in November 2008 with the passage of the Proposition 1A.
With that endorsement, $9.95 billion state general obligation
bond funds were authorized for eventual sale, providing the
initial capital seed funds for the completion of the entire
statewide system.
Additionally, AB 3034 establishes significant oversight
processes and control mechanisms for the independent review and
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approval of financing and engineering plans for the construction
of California's high-speed train system. Reporting and other
oversight mechanisms were also required by subsequent Budget Act
requirements.
Together with the passage of Proposition 1A and California's
approval and pending receipt of $2.25 billion in federal ARRA
high-speed rail funds, the Authority will soon be approving
multi-billion dollar engineering and construction contracts, in
accordance with a schedule approved by the federal ARRA funding
agency (Federal Railroad Administration). Accordingly,
environmental reviews of the initial Phase 1 segments are slated
to be completed by September 30, 2011, with construction
beginning by September 30, 2012.
The author's office contends that, "While there may be some
benefits to high speed rail, it should not come at the expense
of our schools, local transportation, public safety, and health
and human services. It should be noted that $9-10 billion
represents only startup costs for this project. The Authority
estimates the costs for this project in excess of $40-60
billion. The Legislature should demand complete projections and
tracking mechanisms prior to funding any project with public
funds."
Consistent with the author's above stated intentions, this bill
has been significantly amended to delete its original contents
and to replace it with reporting and tracking mechanisms that
will increase oversight of Authority activities. Accordingly,
the bill requires Authority to provide to the appropriate
legislative committees a six-year funding program similar to the
report on state transportation improvement projects as prepared
by the California Department of Transportation. Further, on an
annual basis, this bill requires a separate report on the
progress made on the construction of the system as well as the
plans to finance it. This annual progress report is based upon
a similar progress report that is prepared by the Bay Area Toll
Authority for the seismic retrofit of the San Francisco Bay area
toll bridges.
Related bill: AB 1375 (Galgiani) of 2009, would create a
High-Speed Rail Department and also would establish similar
tracking and oversight reports as provided by this bill. AB 1375
passed out of this committee on a 9-4 vote and is pending in the
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Senate.
Analysis Prepared by : Ed Imai / TRANS. / (916) 319-2093
FN: 0004600