BILL ANALYSIS
SB 1371
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Date of Hearing: August 23, 2010
ASSEMBLY COMMITTEE ON TRANSPORTATION
Bonnie Lowenthal, Chair
SB 1371 (Correa) - As Amended: August 16, 2010
SENATE VOTE : Not relevant
SUBJECT : High-speed Passenger Train Bond Funds: letters of no
prejudice
SUMMARY : Authorizes letters of no prejudice (LONP) for the $950
million in high-speed passenger train bond funds intended for
capital improvements to intercity and commuter rail lines and
urban rail systems. Specifically, this bill :
1)Authorizes eligible recipients of these bond dollars to seek
LONPs, as defined, from the California Transportation
Commission (CTC).
2)Authorizes the CTC to approve LONPs for projects that it has
programmed or otherwise approved, regardless of whether bond
funding has been previously appropriated for the project.
3)Provides that expenditures for projects with approved LONPs
may be reimbursed with bond dollars if all of the following
apply:
a) The project has commenced and expenditures have been
incurred by the eligible recipient.
b) The expenses are eligible for reimbursement according to
state and federal laws and procedures.
c) The eligible recipient complies with all legal
requirements of the project, including compliance with the
California Environmental Quality Act.
d) The expenditures were incurred after the project was
programmed or otherwise approved by the CTC.
e) Sufficient bond dollars are available.
4)Authorizes the CTC to develop guidelines to implement LONPs
for the $950 million in high-speed passenger train bond funds
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intended for intercity and commuter rail, using guidelines
already developed for similar bond programs to the extent
possible.
5) Is an urgency measure.
EXISTING LAW:
1)The Safe, Reliable High-Speed Passenger Train Bond Act (Bond
Act) for the 21st Century, makes available, in part, $950
million for capital improvements to intercity and commuter
rail lines and urban rail systems that provide direct
connectivity to the high-speed passenger train system. Of the
$950 million, $190 million is allocated to The Department of
Transportation for state-supported intercity rail lines that
provide regularly scheduled service and that use public funds
for operation and maintenance. (A minimum of $47.5 million
must be allocated to each of the state's three intercity rail
corridors.) The remaining funds, $760 million, are allocated
by the CTC to eligible recipients by formula related to a
recipient's proportional share of the statewide number of
track miles, annual vehicle miles, and annual passenger trips.
2)Provides that allocations from this money may be used for
capital improvements that provide direct connectivity to the
high-speed passenger train system, are part of the
construction of the system, or that provide capacity
enhancements, modernization, rehabilitation, or safety
improvements.
3)Makes public agencies and joint powers authorities that
operate regularly scheduled passenger rail service in the
following categories eligible recipients of the bond dollars:
a) Commuter rail;
b) Light rail;
c) Heavy rail; and,
d) Cable car.
4)Authorizes LONPs for projects to be funded under the Highway
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Safety, Traffic Reduction, Air Quality, and Port Security Bond
Act of 2006 that provided $20 billion in funds for
transportation capital improvements.
FISCAL EFFECT : Unknown; however, according to the Assembly
Appropriations Committee analysis of last year's AB 672 (Bass),
Chapter 462, Statutes of 2009 that similarly authorized LONPs:
1)Minor additional costs to the CTC to approve and issue LONPs
and to track compliance with bond act requirements for
projects receiving LONPs.
2)Potential significant savings in aggregate state and local
transportation funds to the extent the issuance of LONPs
allows projects to remain on schedule and thus reduces total
project costs.
COMMENTS : Under current law, CTC and other administering
agencies have established LONP programs for various funding
categories under Proposition 1B, the Highway Safety, Traffic
Reduction, Air Quality, and Port Security Act of 2006. LONPs
are essentially agreements between a local or regional
transportation agency and the agency responsible for
administering a specific category of state bond funds. LONP
agreements allow a local or regional agency that wants to expend
their own local funds to begin or continue a project and then be
reimbursed later from state bond funds, when the bond funds
become available. The timing and amount of reimbursement form
state bond funds is not guaranteed so local agencies, not the
state, assume the risk of choosing to use the LONP process to
advance funding for a project.
The Los Angeles County Metropolitan Transportation Authority
supports SB 1371 because it will allow the Southern California
Regional Rail Authority (SCRRA) to move forward with a $200
million rail safety program to implement positive train control
throughout the Metrolink system. SCRRA intends to implement
positive train control by 2012.
Other projects will also be eligible for LONPs under this bill.
Related legislation: AB 2703 (John A. Perez) is similar to this
bill and is currently pending in Senate Rules Committee.
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REGISTERED SUPPORT / OPPOSITION :
Support
Altamont Commuter Express/ San Joaquin Regional Rail Commission
California Transit Association
Los Angeles County Metropolitan Transportation Authority
Orange County Business Council
Southern California Regional Rail Authority
Ventura County Transportation Commission
Opposition
None on file
Analysis Prepared by : Janet Dawson / TRANS. / (916) 319-2093