BILL ANALYSIS �
AB 1779
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Date of Hearing: April 16, 2012
ASSEMBLY COMMITTEE ON TRANSPORTATION
Bonnie Lowenthal, Chair
AB 1779 (Galgiani) - As Amended: April 9, 2012
SUBJECT : Intercity Passenger Rail Act for the San Joaquin
Corridor
SUMMARY : Reauthorizes a locally-controlled joint powers
authority (JPA), upon specified conditions and until December
31, 2013, to assume administrative responsibilities for the
state-supported San Joaquin intercity rail passenger service
(San Joaquin). Specifically, this bill :
1)Establishes the Intercity Passenger Rail Act of 2012 for the
San Joaquin Corridor.
2)Makes findings and declarations relative to the state's
intercity rail passenger system, including the state's
interest in ensuring the protection of its $1.8 billion
investment in the system.
3)States the intentions of the Legislature that, among other
items, authorizes the Secretary of the Business,
Transportation and Housing Agency (Secretary) to allow the
California Department of Transportation (Caltrans) to enter
into an interagency transfer agreement with respect to the San
Joaquin if a JPA and governing board are created and organized
that result in administrative or operating cost reductions.
4)Requires the Secretary to establish through the budget process
the level of state funding available for the operation of each
corridor.
5)Requires, where the administration of the corridor service has
been transferred to a local JPA, the Secretary to allocate
funds to that entity for the operation of mutually agreed
services, in accordance with the interagency transfer
agreement; requires the transfer of funds to that entity for
the administration and marketing of services.
6)Authorizes, but does not require, the JPA or the local or
regional entities to augment state-provided resources to
expand intercity passenger rail services or to address funding
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shortfalls in achieving agreed upon performance standards.
7)Prohibits the JPA or local or regional agencies from using
existing sources of transit funding, as specified, to expand
services or address funding shortfalls in achieving agreed
upon performance standards.
8)Authorizes the JPA or local or regional agencies to identify
and secure new supplemental sources of funding for purposes of
expanding or maintaining intercity rail passenger service
levels, that may include state and federal intercity rail
resources.
9)Authorizes Caltrans to provide any support services upon
mutual agreement with the JPA.
10)Requires operating costs to be controlled by various factors
as identified, including costs attributed to Section 209 of
the federal Passenger Rail Investment and Improvement Act
(PRIIA).
11)Authorizes the Secretary to modify, not later than December
31, 2014, performance standards for the San Joaquin corridor.
12)Prohibits local resources to be used to offset any
redirection, elimination, reduction, or reclassification of
state resources for operating intercity rail services.
13)Allows Caltrans, upon authorization by the Secretary, through
an interagency transfer agreement, to transfer to a JPA all
responsibility for administering intercity passenger rail
service in the corridor.
14)Mandates the Secretary to require the JPA to demonstrate the
ability to meet the performance standards as established.
15)Authorizes Caltrans and any entity assuming the transfer of
the San Joaquin to contract with Amtrak or any other rail
operator to operate the services and authorizes these entities
to contract with the railroad corporations and other rail
operators for the use of tracks and other facilities;
establishes that Caltrans is a third-party beneficiary of the
operation contract; requires a private contractor to agree
that its labor relations shall be subject to federal labor
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laws if selected as the operator of the rail passenger
service.
16)Deletes and recasts provisions that establish the San Joaquin
Corridor Joint Powers Authority (San Joaquin JPA). Allows for
future appointments of additional members if the service
boundaries of the San Joaquin corridor are expanded.
17)Redefines the San Joaquin corridor to extend the western
terminus beyond Oakland to the San Francisco Bay Area.
18)Provides for the San Joaquin JPA to be created when the
agencies electing to become members enter into a joint powers
agreement, as specified; provides that only those agencies
that appoint members by December 31, 2013, would be the
representative agency members of the San Joaquin JPA.
19)Repeals and recasts the Steering Committee of the Caltrans
Rail Task Force to advise the JPA.
EXISTING LAW :
1)Authorizes Caltrans, in cooperation with local transportation
officials, to develop guidelines to implement the intercity
rail program and defines the intercity rail corridors within
which rail projects are eligible for funding. Requires
Caltrans to develop a comprehensive statewide rail passenger
and freight system plan.
2)Authorizes Caltrans to contract with Amtrak for intercity rail
passenger services and provides funding for these services
from the Public Transportation Account.
3)Authorized, until December 31, 1996, Caltrans, subject to
approval of the Secretary, to enter into an interagency
transfer agreement under which a JPA assumes responsibility
for administering the state-funded intercity rail service in a
particular corridor.
4)Establishes the terms of the interagency transfer agreements,
when approved by the Secretary, to include various elements as
specified.
5)Authorizes the establishment of the San Joaquin JPA upon
agreement of the represented agencies for the purpose of
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assuming responsibility for intercity passenger rail services
in the San Joaquin corridor. Specifies the membership of the
agency, including members from the Capitol Corridor JPA and
from the County of Los Angeles.
6)Establishes the San Joaquin Valley Rail Committee to be
comprised of elected officials and members of the public
representing 13 counties along the San Joaquin train route.
7)Authorizes the Steering Committee of the Caltrans Rail Task
Force to confer with the Secretary to coordinate intercity
passenger rail service for the San Joaquin corridor, including
assisting in the development of an appropriate management
structure for the San Joaquin corridor as an element of a
coordinated statewide intercity rail system.
8)Requires intercity passenger rail services to attain specified
farebox recovery ratios in order to be eligible for state
operating funds. Specifically, 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%.
FISCAL EFFECT : Unknown
COMMENTS : Intercity passenger rail service is a component of
the state's overall transportation system and operates between
several regions of the state. Accordingly, intercity rail
travel services are provided between metropolitan areas and to
rural areas. For California, intercity rail passenger services
include three state-supported corridor routes and four Amtrak
long-distance routes. The three in-state intercity rail routes
were funded, planned and administered by Caltrans until July,
1998, when the Capitol Corridor JPA assumed administration of
the Capitol Corridor (Auburn-Sacramento-Oakland-San Jose). The
other two intercity rail passenger services, the Pacific
Surfliner (service between San Luis Obispo and San Diego through
Santa Barbara and Los Angeles) and the San Joaquin (serving
Central Valley, linking Los Angeles and Bakersfield with
Sacramento and the Bay Area) continue to be administered by
Caltrans.
In California, Amtrak operates all three state-supported
intercity rail services, although for the Capitol Corridor,
there is an agreement with the Capitol Corridor JPA that Amtrak
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continue to operate that intercity service. The state of
California, through Caltrans, funds 70% of the operating deficit
of the Pacific Surfliner with Amtrak funding the remaining 30%
operating deficit (ridership farebox revenues minus operational
costs). For the San Joaquin and the Capitol Corridor service,
Caltrans funds 100% of the operating deficit. Amtrak pays 30%
of the operating deficit for the San Diego service as it was a
part of the basic national passenger train service. Lastly,
California pays for the majority of capital improvements to
these intercity rail services.
Purpose of the bill : This bill would reauthorize a
locally-controlled JPA, until December 31, 2013, to assume
administrative responsibilities for the state-supported San
Joaquin. The author cites the 15-year period of successful
operation of the Capitol Corridor JPA since the administration
of the Capitol Corridor was transferred to that JPA from
Caltrans. The author indicates the success was accomplished
without the direct financial contribution by the member agencies
of the Capitol Corridor JPA and cites that beyond the "more cost
effective administration and operations, the Capitol Corridor
JPA has shown that there are several other potential benefits to
local authority administration of intercity passenger service
including: the ability to have a stronger voice in advocating
for service improvements and expansions; local decision-making
that is more responsive and adaptive to passenger issues; the
ability to take better advantage of joint marketing and
partnerships with local agencies; and more engagement by local
communities to support the service."
The author further indicates that the Central Valley Rail
Working Group is working with other entities to explore the
development of a regional JPA that would enable regional
governance of the San Joaquin, similar to the Capitol Corridor
JPA. This legislation furthers that effort.
San Joaquin : The San Joaquin intercity rail and interlinking
bus passenger service administered by Caltrans and operated by
Amtrak as part of the Amtrak California network in California's
Central Valley. It is Amtrak's fifth-busiest service in the
nation. During the past year, 2011, the service carried over
one million passengers, a 9.2% increase from the year before.
Total revenue during 2011 was over $35 million, nearly a 14%
increase over the prior year. Twelve trains a day run between
Bakersfield and Stockton, where the route splits to either
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Oakland (four trains each way a day) or Sacramento (two trains
each way a day). At Bakersfield, bus service connects to Los
Angeles Union Station and other areas in Southern California and
the Central Coast and, significantly, the southern travel
comprise about 30% of the overall San Joaquin riders. The state
pays the net operating loss of the feeder buses that serve this
route as well as the deficits from the train operations.
Lastly, Caltrans owns all the San Joaquin trains while Amtrak
maintains them at the Amtrak operated facility in Oakland.
The San Joaquin runs on the Burlington Northern Santa Fe (BNSF)
freight railroad tracks from Bakersfield to Stockton. At
Stockton, the route splits and runs on the Union Pacific (UP)
railroad tracks to Oakland (39 miles) or Sacramento (49 miles).
According to the Caltrans' California State Rail Plan, "75% of
the 365 mile rail corridor from Bakersfield to Oakland and
Sacramento is single track?Ultimately, the entire BNSF main line
in the San Joaquin Valley may need to be double tracked, but
that is a long term goal extending well beyond the next ten
years."
The UP owns the single track freight line between Bakersfield
and Los Angeles, passing through Mojave and Palmdale. According
to UP, that freight line is one of the busiest in the western
United States and is also used by BNSF freight trains operating
on trackage rights. Further, UP contends that there is no
excess capacity on this line and any addition of regularly
scheduled passenger services would have a detrimental impact on
their ability to provide competitive freight rail service.
Altamont Commuter Express : The Altamont Commuter Express (ACE)
was established to serve San Joaquin County residents traveling
to work at firms in Santa Clara County. Four trains per day
leave Stockton each morning and return from San Jose after noon.
The operation is funded primarily by local sales taxes, with
additional support from state and federal sources.
ACE is owned and operated by the San Joaquin Regional Rail
Commission Joint Powers Authority (San Joaquin Rail Commission)
formed in 1997 by Alameda, San Joaquin, and Santa Clara
counties. It is represented by members of these counties as
well as one Bay Area Rapid Transit District (BART)
representative and representatives of five cities. Cost sharing
for capital projects, excluding stations, during the initial 36
months of service was determined by the San Joaquin Rail
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Commission on a case by case basis and approved by each of the
member agencies. The initial purchase of rolling stock,
construction of stations, and other start-up costs, amounting to
some $48 million, were covered primarily by the revenues from
the separate county special transportation sales taxes.
Currently, station improvements are the responsibility of the
county in which the station is located. Further, ACE pays UP,
the owner of the right of way, about $1.5 million per year for
the rights to run passenger service on the tracks; it also uses
about four miles of Caltrain track in San Jose. Farebox
revenues generate approximately 30% of the operating and
administrative costs. Most of the annual operating cost
deficits are underwritten by the three counties in proportion to
the boardings and alightings in each county and, as mentioned
earlier, generally are paid from each counties' local
transportation sales tax. Further, each county absorbs its own
administrative costs, estimated at $2.4 million annually.
According to the California High-Speed Rail Authority
(Authority), plans are being generated to upgrade the current
ACE system to provide faster, more regular service, and to
rename the route the Altamont Corridor Express. The plan
includes electrification of the route along with possible
extension to the City of Modesto.
San Joaquin interface with the California High-Speed Rail
System : According to the Authority's revised Business Plan,
Caltrans is working with the San Joaquin Rail Commission (the
owner/operator of the ACE) and others to identify early
investments for connecting regional rail service to the first
segment of the Authority's initial operating segment (IOS) using
the San Joaquin intercity rail passenger service and the ACE
interregional commuter service. The Authority indicates that
the San Joaquin Rail Commission, Caltrans, the Capitol Corridor
JPA, and Sacramento Regional Transit District have developed a
Northern California Unified Service (Unified Service) concept.
The Unified Service would use the first IOS segment in the
interim period until the initiation of full high-speed service.
Once high-speed rail becomes operational, according to the
Authority, the improved network becomes a critical feeder
service to the high-speed rail system. The Unified Services
group is finalizing a memorandum of understanding (MOU), to
which the Authority would be a party, that includes a list of
early investments such as grade-crossing improvements, grade
separations, double-tracking, curve realignments, and positive
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train control that will improve existing rail operating speeds
and safety and allow for substantial increases in frequency by
the 2018 operations on the first IOS section.
Section 209, PRIIA : Section 209, of PRIIA, requires states to
pay 100% of the costs of short-distance intercity Amtrak
services and capital costs. Currently, Caltrans pays 70% of the
operating costs of the Pacific Surfliner intercity rail
passenger services and Amtrak pays the remaining 30%. For the
San Joaquin and Capitol Corridor intercity train services,
Caltrans pays 100% of the operating deficit and therefore the
impact of Section 209 implementation in 2013-14 will have a
negligible cost impact upon the state for these two services.
State's remaining role in intercity rail passenger services :
This bill requires, upon implementation of the interagency
transfer agreement, Caltrans to continue coordinating San
Joaquin intercity rail service with other intercity passenger
services in the state. With the possible transfer of state
administration of all three state-supported intercity rail
passenger services - the San Joaquin, Capitol Corridor, and the
Pacific Surfliner - to locally-approved JPAs, what will be the
state's residual role in overseeing the operations and
interconnectivity of these separate services?
Arguments in support :
1)Writing in support of this bill, numerous cities and regional
entities within the San Joaquin Valley contend that with a
more efficient administration and stronger local/regional
support, a regionally managed San Joaquin service can result
in much higher frequencies of service and increases in
ridership and revenue - similar to the Capitol Corridor JPA.
They cite that the increases in service and ridership will
result in more jobs, improve air quality, and help promote
sustainable development.
2)Upon implementation of the agreement between ACE and the
current San Joaquin operations, the Unified Service will
facilitate the effective integration of the these services
with the early implementation of the Authority's initial
high-speed rail construction segment, scheduled for
construction in 2018. Further, upon completion of the rail
linkage between Bakersfield and the San Fernando Valley,
higher speed service for the California's intercity rail spine
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will be seamless and operational.
3)As the Secretary has presumptive approval authority to
effectuate the state's transfer of responsibilities and assets
to the local JPA, it will do so only upon the determination
that such a transfer will result in administrative or
operating cost reductions.
4)The terms of the interagency transfer agreement, as specified
under existing law, serve to protect the interests of the
joint powers authority as well as the state. Further, as an
element of the interagency transfer agreement, the requirement
for the JPA business plan will provide a roadmap on how the
entity will proceed and provide some level of confidence to
state decisionmakers.
5)The bill requires the Steering Committee of the Caltrans Rail
Task Force to advise the JPA. As Caltrans has improved the
services to high ridership levels, its expertise in continuing
successful operations of this corridor could prove invaluable.
6)According to the sponsors, the formation of a JPA could
"provide stronger negotiating strength with the freight
railroads for new passenger services or dealing with freight
conflicts."
7)SB 1225 (Padilla), currently being considered in the Senate,
makes significant changes to the elements of the interagency
transfer agreement and, accordingly, both bills will need to
be harmonized in the near term.
Arguments in Opposition :
1)The bill may be premature, especially as California is
undertaking a major high-speed rail planning and
implementation project. A large component of this effort
focuses on "blending" high-speed rail services and
conventional commuter and intercity passenger rail services in
the San Joaquin corridor. Considering the technical,
operational, and policy issues that need to be resolved by the
Authority, Caltrans, and other agencies, at this point in
time, a change in administration of the San Joaquin may be
problematic.
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2)Rail service in this corridor is not a regional function. The
San Joaquin corridor acts as the "spine" of intercity
passenger rail in the state, connecting with other rail and
public transportation services in northern and southern
California. Coordination with the state-administered
Surfliner Corridor would be more difficult, particularly with
the extensive bus-train linkages between the two corridors.
3)Any additional capacity of the railroads operating within the
San Joaquin corridor may not materialize, making it difficult
to achieve additional rail passenger services.
4)The bill requires that the current level of rail service be
maintained. However, if funding shortfalls should come about
because of revenue declines, the bill does not specify sources
of additional funding. Further, as the bill currently
prohibits some sources of local funding to be used for
corridor operational funding deficits, one can question how
necessary funding will materialize.
Suggested amendments :
1)Eliminates any ambiguity as to the responsibility of the
Secretary in terms of approving the interagency transfer
agreement. This change will make the provision operative
rather than intentive.
On page 3, move lines 20-26 inclusive, to line 39 and replace
(2) with (c).
2)Removes restrictions that could inhibit counties from securing
available sources of funding that may be necessary to cover
operating deficits.
On page 4, delete lines 16-25 inclusive and on line 26, delete
the following: 99313 and 99314 of the Public Utilities Code.
Related Bills : SB 457 (Kelley), Chapter 263, Statutes of 1996,
authorized, until December 31, 1996, the transfer of
responsibility for the Capitol Corridor, Pacific Surfliner, and
the San Joaquin intercity rail service to three specified joint
powers agencies within those corridors. The transfer of service
is to be accomplished through joint agency agreements between
Caltrans and the agencies, approved by the Secretary. The JPA
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for the Capitol Corridor was the only entity formed by the
deadline.
SB 1118 (Monteith), Chapter 202, Statutes of 1997, authorizes
the establishment of the San Joaquin Corridor JPA. Also,
provides direction to the Steering Committee of the Caltrans
Rail Task Force to coordinate intercity passenger rail service
for the San Joaquin corridor.
SB 1225 (Padilla), of 2012, similar to this bill, would
authorize, until December 31, 2013, Caltrans to transfer the
administration of the Pacific Surfliner intercity rail corridor
to a joint powers board established for that purpose. The bill
is to be heard in the Senate Transportation and Housing
Committee tomorrow.
Double referral : This bill has also been referred to the
Assembly Local Government Committee.
REGISTERED SUPPORT / OPPOSITION :
Support
Central Valley Rail Working Group (co-sponsor)
San Joaquin Valley Regional Policy Council (co-sponsor)
California Partnership for the San Joaquin Valley
City of Fresno
City of Lodi
City of Merced
City of Modesto
County of Fresno
Madera County Transportation Commission
Merced County Association of Governments
Sacramento Councilmember Steve Cohn
Sacramento Regional Transit District
San Joaquin Regional Rail Commission
San Joaquin Regional Transit District
San Joaquin Valley Air Pollution Control District
Opposition
None on file
Analysis Prepared by : Ed Imai / TRANS. / (916) 319-2093
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