BILL ANALYSIS �
SB 1225
Page 1
Date of Hearing: June 25, 2012
ASSEMBLY COMMITTEE ON TRANSPORTATION
Bonnie Lowenthal, Chair
SB 1225 (Padilla) - As Amended: May 29, 2012
SENATE VOTE : 38-0
SUBJECT : Intercity rail passenger service: interagency
transfer agreement
SUMMARY : Authorizes, until June 30, 2014, the Department of
Transportation (Caltrans) to enter into an interagency transfer
of services agreement (ITA) with the Los Angeles-San Diego-San
Luis Obispo (LOSSAN) corridor agency for the provision of
intercity passenger rail service. Specifically, this bill :
1)Makes various findings and declarations regarding the
importance of intercity rail as an element of the state's
transportation system, the state's historical investment in
capital improvements and operation support for intercity rail
service, and the importance of protecting that investment.
2)States legislative intent, upon enactment of the bill, that:
a) The Secretary of the Business, Transportation and
Housing Agency (Secretary) is to be responsible for the
overall planning, coordination, and budgeting of the
intercity passenger rail service;
b) The Secretary may authorize Caltrans to enter into an
ITA if it determines that the transfer would result in
administrative or operating cost reductions;
c) The transferred corridor is to remain a component of the
statewide system of intercity passenger rail corridors;
d) The public interest requires expansion of the state
intercity passenger rail program in order to keep pace with
population growth;
e) The desirable state funding be maintained at a level
equal to at least the current level of service for a period
of not less than five years;
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f) The LOSSAN corridor operations maintain a ratio of
farebox revenue to operating cost of no less than 58%; and,
g) The LOSSAN corridor agency retain an individual to
manage the contract with the state who has previous
experience operating or managing intercity or commuter
passenger rail services.
1)Authorizes local and regional entities as well as the joint
powers agency (JPA) to augment service or to fund shortfalls
when agreed upon performance standards are not reached but
prohibits a mandate for them to do so.
2)Authorizes the Secretary to adopt new performance standards by
December 31, 2014, for LOSSAN corridor intercity rail
services.
3)Prohibits the expenditure of local funds to offset any
redirection, elimination, reduction, or reclassification of
state resources for administering, marketing, and operating
intercity passenger rail services in the corridor.
4)Establishes a new deadline of June 30, 2014, for execution of
the ITA.
5)Requires the Secretary-approved ITA, for the LOSSAN corridor,
to maintain an annual level of state funding covering an
initial five-year period, but allowed to be extended by mutual
consent.
6)Requires the LOSSAN corridor initial business plan to be
consistent with the immediately previous State Rail Plan as
developed by Caltrans.
7)Establishes the level of funding provided by the state at no
less than the funding level provided in the 2012-13 fiscal
year operating contract between Caltrans and the National
Railroad Passenger Corporation (Amtrak).
8)Establishes the level of funding provided by the state for
feeder bus service at the same level as provided January 1,
2013.
9)Prohibits termination of feeder bus services connecting the
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LOSSAN and San Joaquin corridors except for specified reasons.
10)Requires the passenger rail equipment regularly used for
intercity passenger rail service on the LOSSAN corridor to be
the same type of equipment regularly used on other intercity
corridors to ensure that there is a statewide pool of common
intercity passenger rail equipment for purposes of
interoperability among the state-funded corridors and for
vehicle fleet management.
11)Deems the LOSSAN corridor agency as an entity of the state,
allowing it to be a direct recipient federal public
transportation grants.
12)Repeals provisions authorizing the Southern California
Regional Rail Authority (SCRRA) to be a party to the ITA and
replaces it with the LOSSAN corridor agency.
13)Stipulates that the bill is only operative if the members of
the LOSSAN corridor agency enter into an amended joint powers
agreement to expand the authority of the existing agreement.
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, and 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 ITA under
which a JPA assumed responsibility for administering a
state-funded intercity rail corridor service. Authorized
an expanded SCRRA, a JPA of five member agencies
representing the counties of Los Angeles, Orange,
Riverside, San Bernardino and Ventura, to be a party to an
ITA for assuming operational authority for intercity rail
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passenger services in southern California.
4) Establishes the terms of the ITA to include various
elements, including the date and conditions of transfer;
the funds to be transferred; the level of service to be
provided and Caltrans' methods for coordination of
services, annual review of the business plan, annual
proposals on funding and appropriations; the terms for
transferring car and locomotive train sets; and auditing
and other procedures.
5) Provides for the allocation of state funds by the
Secretary to a JPA under the terms of the ITA and based on
the annual business plan that includes the level of service
to be operated. As provided in the ITA, authorizes the JPA
to provide any additional funds that are needed to operate
the passenger rail service during a fiscal year from
jurisdictions that receive service.
6) Authorizes Caltrans and any entity that assumes
administrative responsibility for passenger rail services
through an ITA to contract with specified entities for the
use of tracks and other facilities and for the provision of
passenger rail services.
7) Requires a JPA to submit an annual business plan which
is the basis of a budget request for service.
8) Pursuant to federal law:
a) Authorizes states or state-created entities to contract
with Amtrak for intercity passenger rail service.
b) Beginning in October 1, 2013, requires states, according
to a national cost allocation process adopted by the
Service Transportation Board, to pay the full operating and
capital cost for intercity passenger rail service in which
the service is less than 750 miles in length. Interstate
service is exempt from this provision.
FISCAL EFFECT : Unknown
COMMENTS : The 351-mile-long LOSSAN rail corridor (San Diego to
Los Angeles to San Luis Obispo) is the second busiest passenger
rail corridor in the nation, second only to the
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Boston-to-Washington D.C. Northeast Corridor. More than nine
million passenger riders make trips on LOSSAN corridor commuter
and intercity trains annually. The corridor runs through a
six-county area, connecting major metropolitan areas of Southern
California and the Central Coast. The LOSSAN rail corridor
includes 41 stations and more than 100 daily passenger trains.
Since the 1970s, the state has provided more than $1 billion in
improvements to the corridor, Amtrak has contributed $220
million, and local passenger rail agencies have contributed $400
million.
There are three passenger rail carriers along this route,
Amtrak's intercity Pacific Surfliner and the Metrolink and
Coaster commuter lines:
1)Amtrak operates both the long distance intercity Coast
Starlight and the Pacific Surfliner passenger trains. The
Pacific Surfliner route (essentially comprising the LOSSAN
rail corridor), under the administration of Caltrans, is
wholly within California and operates between San Diego and
San Luis Obispo. It receives financial support from Caltrans
that pays 70% of Pacific Surfliner costs above fare revenue.
Amtrak contributes the remaining 30% of the operating deficit
as the service is considered a part of Amtrak's basic
intercity service. More than 2.8 million intercity rail
passengers annually use the Pacific Surfliner service.
Amtrak's other long-distance service, Coast Starlight,
provides daily service connections between Seattle and Los
Angeles, passing through Portland, Sacramento, the San
Francisco Bay Area and Santa Barbara.
2)Metrolink is the Los Angeles area commuter rail service,
operated by the SCRRA. The Metrolink operations encompass six
rail lines and 55 stations using 512 miles of track. The
system operates within the counties of Los Angeles, Orange,
Riverside, San Bernardino, San Diego, and Ventura. It
connects with the Metro Rail system which serves Los Angeles
County, with the San Diego Coaster and Sprinter commuter rail
services which serves San Diego County, and with Amtrak's
Pacific Surfliner, Coast Starlight, Southwest Chief and Sunset
Limited intercity rail services.
3)Coaster commuter rail service, between the City of Oceanside
and the City of San Diego, is operated by the North County
Transit District (NCTD). The Coaster operations include 7
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locomotives covering the 41-mile route. It reports about 1.4
million boardings annually. The Sprinter commuter rail
service also operates within the corridor with a station
located at Oceanside continuing eastward to Escondido.
These rail passenger trains operate over tracks that are owned
by two public agencies in San Diego County, the Orange County
Transportation Authority, the Los Angeles County Metropolitan
Transportation Authority (Metro), the Union Pacific Railroad
(UP), and the Burlington Northern Santa Fe (BNSF) Railroad. In
addition, the Riverside County Transportation Commission (RCTC)
acquired the passenger rail rights between Fullerton and Los
Angeles from BNSF in the 1990s. This requires any passenger
rail operator, except Amtrak, to secure RCTC's concurrence
before initiating or increasing service in that segment of the
corridor. Railroad services operating in the corridor include
freight transport provided by UP and BNSF, commuter rail service
by Metrolink in Los Angeles, Orange, San Diego, and Ventura
counties and by the Coaster in San Diego County, and Amtrak's
intercity long-distance Coast Starlight service as well as its
Pacific Surfliner service.
To coordinate the interconnected rail passenger intercity and
commuter services of the above three entities within the Pacific
Surfliner corridor, a JPA was formed in 1989. Metro, Orange
County Transportation Authority, NCTD, San Diego Association of
Governments, San Diego Metropolitan Transit System, San Luis
Obispo Council of Governments, Santa Barbara County Association
of Governments, Ventura County Transportation Commission, and
Caltrans are voting members of the JPA. The Southern California
Association of Governments, Amtrak, and the California
High-Speed Rail Authority are non-voting, ex-officio members of
the JPA. Further, there are four additional non-voting
technical advisory committee members on the JPA representing the
BNSF, the California Public Utilities Commission, SCRRA, and UP.
The LOSSAN corridor agency advises Caltrans, as administrator of
the corridor, on Amtrak services and facility improvements
within the corridor. Legislation enacted in 1996 provided an
opportunity for the LOSSAN corridor agency to create a JPA to
assume responsibility for the LOSSAN intercity passenger service
by December 31, 1996. An agreement with Caltrans could not be
reached because the local agencies were unable to reach a
consensus on the structure of the corridor agency. Accordingly,
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the responsibility for the service remains with Caltrans. This
bill is the second attempt for the separate agencies to reach
consensus on a joint powers agreement.
State-supported intercity rail passenger services : In
California, there are three state-supported intercity rail
passenger services within three distinct corridor routes. In
addition to the LOSSAN corridor described earlier, the state has
funded Amtrak service from Bakersfield to Oakland via Stockton
and Martinez since 1979 (San Joaquins), and the state contracted
with Amtrak to operate service from Sacramento to Oakland/San
Jose in 1991 (Capitol Corridor). The management of the latter
service was transferred to the Capitol Corridor Joint Powers
Agency (CCJPA) in 1998 by an ITA.
Prior to 1976, Amtrak supported three round trips along the
present Pacific Surfliner route from San Diego to Los Angeles.
Under Caltrans management since 1976, the Pacific Surfliner
route has been expanded to current service level of 11 daily
round trips from San Diego to Los Angeles, five daily round
trips continuing to Santa Barbara, and two daily round trips
continuing to San Luis Obispo. The current LOSSAN farebox
recovery ratio (ratio of revenues to expenses) in state fiscal
year 2010-11 was 54%. In contrast, the farebox ratio for the
San Joaquin service was 49%, and the Capitol Corridor, under
transferred administration from the state since 1998, was 39%,
the lowest of the three intercity passenger train services.
Section 209, Passenger Rail Investment and Improvement Act of
2008 : The federal Passenger Rail Investment and Improvement Act
of 2008, Section 209, requires states to pay 100% of the costs
of short-distance intercity Amtrak services and capital costs
starting October 1, 2013. Currently, for the Pacific Surfliner
services, Amtrak pays 30% of the operating deficit (about $25
million per year) and Caltrans pays the remaining 70% operating
deficit over fare revenues. As the bill establishes the 2012-13
fiscal year as the time period upon which the state funding
level amount is to be maintained for a five-year period, this
pre-dates the time when the state would assume the Section 209
$25 million Amtrak cost subsidy.
LOSSAN board : In January 2010, the LOSSAN corridor agency
outlined a series of short- and long-term strategies that they
indicated would have a direct, positive impact on passenger rail
service between San Diego, Los Angeles, and San Luis Obispo,
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including a proposal to change the existing institutional and
organizational structure of the existing LOSSAN rail corridor
agency. The overall goal of the governance change was to
transform the existing state-supported Pacific Surfliner
intercity rail service, currently operated by Amtrak and managed
by Caltrans, into a service under local management that was
believed by some to be more responsive to local needs, issues,
and consumer desires. The proposed structure was to be modeled
after the CCJPA, which is responsible for managing the
Amtrak/Caltrans-supported service between San Jose, Oakland, and
Sacramento.
At the August 2011 LOSSAN board meeting, members discussed
options for establishing a new, locally-controlled JPA that
would assume administrative responsibilities for the
state-supported Pacific Surfliner service and agreed unanimously
to the plan in concept. The LOSSAN board reiterated that
initial governance changes should focus only on the
state-supported intercity rail service and should not consider
modifications to the Metrolink or Coaster governance structure.
Maintenance of funding level : This bill would require the state
to maintain a minimum level of funding while transferring
operating and management decision-making authority to the LOSSAN
JPA. However, state funds would be directed to the local entity
without specifying the level of service that the JPA is to
maintain. Funding by the state at a minimum level should be
predicated upon the level of service to be sustained, similar to
what is provided in current ITA enabling statutes.
Additionally, the current funding levels are to be maintained by
the state for an intended period of at least three years. This
bill extends that time period to five years. For consistency
with the existing enabling ITA statutes as well as AB 1779
(Galgiani), as passed the Assembly, the funding period for this
bill should also reflect the three-year period.
State's remaining role in intercity rail passenger services :
This bill requires, upon implementation of the ITA, Caltrans to
continue coordinating LOSSAN rail corridor services 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 (under
reauthorization pursuant to AB 1779 (Galgiani), of 2012),
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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?
Purpose of the bill : This bill would authorize a
locally-controlled JPA, the LOSSAN corridor agency, until June
30, 2014, to assume administrative responsibilities for the
state-supported LOSSAN rail passenger corridor. The author
cites the LOSSAN corridor as one of the most important segments
of California's rail system and, despite its vital importance to
California, "current law has stifled corridor improvements. A
JPA modeled after the highly successful CCJPA would allow for
greater administrative, procurement and operational efficiencies
that come with integration."
Arguments in support :
1)Proponents contend that placing passenger rail service in the
LOSSAN corridor under local management will result in a more
efficient and effective allocation of resources and decision
making related to service expansion, frequencies, extensions,
connectivity, and schedules. They further contend that a
unified voice will be more effective at the state and federal
level when advocating on passenger rail issues, including
funding for capital improvements.
2)The author indicates that, to meet the demands of the region,
about $6-8 billion in capital improvements are needed by 2025
to modernize the LOSSAN corridor and by not providing for the
creation of a JPA, the future sustainability of the corridor
is uncertain.
3)Writing in support of this bill, Amtrak indicates that it
"will work collaboratively with the proposed JPA, provided the
entity demonstrates an understanding of the criticality of
preserving, and enhancing, intercity utility along the entire
corridor. Not only do the Pacific Surfliners provide vital
access to communities within the corridor, but the route is an
important part of Amtrak's national network, and the JPA's
actions must reflect this."
4)The terms of the ITA, as specified under existing law, serve
to protect the interests of the JPA as well as the state.
Further, as an element of the ITA, the requirement for the JPA
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business plan will provide a roadmap on how the entity will
proceed and provide some level of confidence to state decision
makers.
5)To ensure fiscal accountability, the bill establishes an
intended goal that the JPA maintain a farebox recovery ratio
of no less than 58%.
Arguments in Opposition :
1)Transfer of the management of this corridor to a JPA, along
with the similar potential transfer of the San Joaquin
corridor pursuant to AB 1779 (Galgiani), would make statewide
coordination of scheduling and other operations difficult.
2)This bill makes several changes to the statutes used to
establish an ITA with the CCJPA that are disadvantageous to
the state. For example, existing law requires the JPA to
augment state funding to address operating funding shortfalls.
This bill also adds a provision that prohibits the use of
local funds for expenditure to offset any redirection,
elimination, reduction, or reclassification of state resources
for operating intercity passenger rail services in the
corridor. Upon transfer of the state-administered Pacific
Surfliner route to the LOSSAN JPA, should ridership decline,
it is unclear how any shortfalls will be managed.
3)Although proponents cite the "highly successful" performance
record of the Capitol Corridor, actual farebox ratios of its
performance are below that of the currently state-administered
Pacific Surfliner and San Joaquin intercity rail passenger
services. Therefore, the LOSSAN JPA will be tasked to
maintain the state's effective past management efforts.
4)Unlike the legislation forming the CCJPA, this bill would not
codify the structure or membership of the JPA that would
assume management of the LOSSAN rail corridor. This raises
doubts about the capacity of the JPA to manage the corridor
because if it's prospective members cannot even agree on the
representational makeup and structure of the JPA it is unclear
that they could effectively manage the more complex task of
corridor operations.
Suggested amendments :
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1)The bill alludes to the fact that the state has a continuing
interest in the provision of cost-effective intercity
passenger rail services and has a responsibility to coordinate
intercity passenger rail services statewide. The bill should
be amended, not to be too prescriptive but to acknowledge
that, if and when funds are transferred to a JPA along with
the responsibility to operate the intercity passenger rail
service, some level of funding, to be determined in the ITA,
will need to be retained with the state to fund sustained,
albeit reduced, statewide responsibilities.
On page 3, line 13, after "statewide." add the following:
This function needs to be sustained even if the
responsibility for the current operations on intercity rail
passenger routes are transferred.
2)Original statutes providing for the transfer of intercity
passenger rail service to a JPA, as well as AB 1779 (Galgiani)
(currently pending in Senate Transportation and Housing
Committee) provide for a three-year transition period. This
bill should be amended to reduce the proposed five-year
transition period of funding to three years, consistent with
AB 1779 as well as existing ITA enabling statutes.
On page 4, delete lines 4-8 inclusive, and replace with the
following:
(5) For not less than a three-year period, the level of
state funding for intercity rail service in each corridor
should be maintained at a level equal to at least the
current level of service in the corridor, thus providing
fiscal stability that will allow appropriate planning and
operation of these services.
On page 6, line 14, replace "five-year" with: three-year
3)Some parties of the proposed JPA are understandably concerned
that the assuming responsibility for the intercity passenger
rail service continue to be an option and not a mandate.
Consequently, the following language clarifies that the
authorization for the LOSSAN JPA to execute an ITA is provided
until June 30, 2014 and is not a mandate upon the JPA.
On page 5, delete line 34, and replace with the following:
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transfer agreement pursuant to (a) for that corridor must
be entered
4)The bill sets forth the expectation that the state should
maintain a consistent level of funding, at least through the
transition period. The bill strikes, however, language that
would ensure that the state continue to receive a sustained
level of intercity passenger rail service. The bill should be
amended--again, not to be too prescriptive-- to set forth the
expectation that the state will continue to receive an
appropriate level of service commensurate with its funding
commitment, as negotiated in the ITA.
On page 8, line 7, after "of" add the following:
service funded by the state shall be at an appropriate
level as determined in the interagency transfer agreement
and the
5)The bill provides that local resources are not available for
expenditure to offset any redirection, elimination, reduction,
or reclassification of state resources for operating intercity
passenger rail services. The bill should be amended to
clarify that this to be the case if such action is caused by
the state.
On page 5, line 14, and on page 8, line 37, after
"reclassification" add: by the state
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 JPAs
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 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.
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AB 1779 (Galgiani), of 2012, similar to this bill, would
authorize, until June 30, 2014, Caltrans to transfer the
administration of the San Joaquin intercity rail corridor to a
JPA established for that purpose. That bill passed out of this
committee and is to be heard in the Senate Transportation and
Housing Committee.
SB 1117 (DeSaulnier), of 2012, would require the California
Transportation Commission to prepare a statewide passenger rail
transportation plan for conventional and high-speed intercity
passenger rail, commuter rail, and urban rail transit. That
bill will be heard in this committee on June 25, 2012.
Double referral : This bill has also been referred to the
Assembly Local Government Committee.
REGISTERED SUPPORT / OPPOSITION :
Support
Los Angeles-San Diego-San Luis Obispo (LOSSAN) Corridor Agency
(sponsor)
Amtrak
Los Angeles County Metropolitan Transportation Authority
Orange County Transportation Authority
Sacramento Regional Transit District
San Joaquin Regional Rail Commission
San Joaquin Valley Regional Policy Council
Santa Barbara County Association of Governments
Ventura County Transportation Commission
Opposition
None on file
Analysis Prepared by : Ed Imai / TRANS. / (916) 319-2093