BILL ANALYSIS �
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
AB 286 (Berryhill)
Hearing Date: 06/27/2011 Amended: 04/27/2011
Consultant: Mark McKenzie Policy Vote: T&H 8-0
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BILL SUMMARY: AB 286 would require proceeds from the sale of
excess properties acquired for improvements to State Highway
Route (SR) 120 that occur on or after July 1, 2013 to be used
for improvements to SR 108 in Stanislaus County, otherwise known
as the North County Corridor (NCC). The bill would also require
the California Transportation Commission (CTC) to program the
funds and any interest earnings to any phase of the NCC, and
authorize CTC to allocate the funds, upon appropriation by the
Legislature, to the Stanislaus Council of Governments (StanCOG)
or any agency designated by StanCOG to deliver the project.
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Fiscal Impact (in thousands)
Major Provisions 2011-12 2012-13 2013-14 Fund
Redirection of funds unknown amount (likely several million)
Special*
redirected for specified alternative
project.
Absent the bill, these funds would be
available
for general allocation to other highway
projects.
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* State Highway Account
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STAFF COMMENTS: This bill meets the criteria for referral to the
Suspense File.
Under current law, whenever Caltrans determines that real
property acquired for highway purposes is no longer necessary,
that property may be sold or exchanged upon terms, standards,
and conditions established by the CTC. Existing law generally
requires the Department of Transportation (Caltrans) to deposit
proceeds from the sale of excess property in the State Highway
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Account; these funds would typically be available for allocation
by CTC for other highway projects in the State Transportation
Improvement Program (STIP) or the State Highway Operations and
Protection Program (SHOPP). Budget trailer legislation enacted
earlier this year, however, requires proceeds from the sales of
all Caltrans excess property to be used to repay
transportation-related general obligation bond debt until July
1, 2013, thereby providing temporary General Fund relief (AB 105
(Committee on Budget), Chapter 6 of 2011).
The CTC originally adopted a northern corridor expressway, the
SR 120 Oakdale Bypass, in 2002. As traffic patterns evolved,
however, Caltrans has decided to abandon the Oakdale Bypass and
a joint powers authority has been formed in the region to
advocate for an alternative North County Corridor (NCC) project
that would bypass the congested areas of SR 108 that pass
through Modesto, Riverbank, and Oakdale. The NCC SR 108 East
Route Adoption was approved by the CTC in May 2010, and the
adopted corridor provides for approximately 18 miles of new
freeway from near SR 219 north of Modesto and West of Riverbank
to SR 120, approximately six miles east of Oakdale. The NCC
project is currently in the roadway alignment study and
preliminary engineering phase. The 2011 regional transportation
plan adopted by the Stanislaus Council of Governments (StanCOG)
indicates that the NCC project is planned for construction in
2030 at an estimated total cost of $1.49 billion. Caltrans
indicates that the first phase of construction near Oakdale
could begin as early as 2018.
AB 286 is intended to ensure that funds from the sale of the
properties associated with the original project are retained for
use on the alternative project rather than returning the
proceeds to the State Highway Account for general highway
purposes elsewhere. This bill would require Caltrans to deposit
the sale proceeds into a special account in the Special Deposit
Fund, and specify that any interest earnings would also accrue
to the account.
This bill would direct funds that would otherwise accrue to the
State Highway Account to a special account and require CTC to
use these revenues for the proposed NCC project. StanCOG
estimates that the value of the excess properties is
approximately $3-$4 million. From a policy perspective, there
may be merit in allowing a region that has used its STIP shares
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for the purchase of land on a project that will not be built to
use any resulting funds for another project in the same region.
However, a diversion of funds to an alternative project in the
same region would come at the expense of other projects that may
have a greater regional or statewide importance. Staff notes
that the bill would divert several million dollars from the
State Highway Account that could otherwise be used for projects
in the near term to a segregated fund for use on a project that
is still in the preliminary stages and will not soon be ready
for construction.
Staff notes that the bill does not allow Caltrans to recover any
costs related to the sale of the properties from the proceeds of
the sale, which would create an additional cost to the State
Highway Account. In addition, if any of the properties
associated with the abandoned SR 120 project were acquired with
federal funds, the state would be responsible for repayment of
those funds to the federal government. Staff suggests that the
bill be amended to allow Caltrans to recover any reimbursements
due to the federal government and all costs incurred in the sale
of the excess properties from the proceeds from the sale of the
excess properties.
Staff notes that AB 1386 (Hayashi), Chapter 291 of 2009,
requires Caltrans to deposit proceeds from the sale of excess
properties in the SR 238 and SB 84 corridors in Alameda County
into a special account. That bill also required CTC to allocate
these revenues to projects in a "local alternative
transportation improvement program."