BILL ANALYSIS �
SB 325
Page 1
Date of Hearing: July 13, 2011
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
SB 325 (Rubio) - As Amended: June 9, 2011
Policy Committee: Local
GovernmentVote:7-2
Transportation 9-3
Urgency: No State Mandated Local Program:
Yes Reimbursable: No
SUMMARY
This bill establishes the Central California Railroad Authority
(CCRA) to provide shortline rail freight service within Fresno,
Kern, Kings, Merced, and Tulare Counties. Specifically, this
bill:
1)Authorizes the Counties of Madera, San Joaquin, and Stanislaus
to elect to join CCRA and authorizies the service area of CCRA
be expanded to incorporate counties that join the CCRA later.
2)Requires CCRA to be governed by a board of directors and
specifies the membership and terms of the board members.
3)Requires CCRA to conduct its first meeting no later than 120
days after abandonment or discontinuance of service on any
railroad line, provided the member counties have formed a
joint exercise of powers agreement to implement and manage
CCRA.
4)Specifies the power of the authority and the operational
requirements, such as adopting a budget and conducting an
annual financial audit.
5)Allows CCRA to acquire, own, lease, and operate railroad lines
and equipment, including, but not limited to, real and
personal property, tracks, rights-of-way, equipment, and
facilities and prepare a plan for the acquisition and
operation of any railroad line.
6) Provides the state is not liable for contracts, debts, or
SB 325
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other obligations of CCRA, and requires agencies forming the
joint powers agreement (JPA) implementing CCRA to be liable
for all debts and obligations of the CCRA.
7)Prohibits CCRA from using, or being a claimant for,
Transportation Development Act funds, or from being entitled
to receive funds from the Public Transportation Account (PTA).
FISCAL EFFECT
There is no state fiscal effect. The activities of the
authority will be funded with local funds and the bill contains
language that no reimbursement for a local mandate is required
because the affected local governments have requested the
authorization for the authority.
COMMENTS
1)Purpose . According to the author's office, communities
heavily reliant on short line rail services stand to lose
access to goods movement and shipping services if an
alternative is not developed to ensure dependable rail service
for Kern, King, Tulare, Fresno, and Merced Counties. The
author notes that unemployment in these counties hovers around
18% and includes many communities with jobless rates exceeding
40%. Small and large businesses alike throughout California,
particularly in the Central Valley, stand to lose greatly if
short rail operations decline or cease to exist. The author
further states that SB 325 would create an authority to ensure
railroad service if the Surface Transportation Board (STB)
authorizes the abandonment or discontinuance of service on
existing short line railroad operations in the Counties of
Kern, Tulare, Kings, Fresno and Merced.
2)Background . The San Joaquin Valley Railroad (SJVR) operates
417 miles of track in central California. The SJVR
interchanges with the Burlington Northern Santa Fe (BNSF)
Railway at Fresno and Bakersfield and with the Union Pacific
Railroad at Fresno and Goshen Junction. The SJVR service
features primary commodities of petroleum products, cattle
feed, building products, tomato paste, consumer products and
dry and liquid fertilizer products.
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In June 2008, the Surface Transportation Board (STB), the
federal agency that oversees the United States' railroad
industry, authorized the abandonment of 30.6 miles of rail
service operated by the SJVR between Strathmore and Jovista in
Tulare County. In the same decision, STB denied a request to
abandon the rail line from Strathmore to near Exeter. STB
documents show that SJVR sought authority to abandon the line
because "there is insufficient traffic available to justify
the cost of maintaining and operating the line, and that
investing capital in the line would not be a prudent use of
carrier resources."
During the abandonment process, Tulare County sought to
acquire the section being abandoned and asked STB to set terms
and conditions for the sale of the right-of-way. STB set the
purchase price at $3.3 million. Tulare County declined to
purchase the line at that price.
Analysis Prepared by : Roger Dunstan / APPR. / (916) 319-2081