BILL ANALYSIS �
SB 1225
Page 1
SENATE THIRD READING
SB 1225 (Padilla)
As Amended August 24, 2012
Majority vote
SENATE VOTE :38-0
TRANSPORTATION 13-0 LOCAL GOVERNMENT 8-0
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|Ayes:|Bonnie Lowenthal, |Ayes:|Smyth, Alejo, Bradford, |
| |Jeffries, Achadjian, | |Campos, Davis, Gordon, |
| |Blumenfield, Bonilla, | |Hueso, Norby |
| |Buchanan, Eng, Furutani, | | |
| |Galgiani, Wagner, Norby, | | |
| |Portantino, Solorio | | |
| | | | |
|-----+--------------------------+-----+--------------------------|
| | | | |
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APPROPRIATIONS 12-5
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|Ayes:|Gatto, Blumenfield, | | |
| |Bradford, Charles | | |
| |Calderon, Campos, Davis, | | |
| |Fuentes, Hall, Hill, | | |
| |Cedillo, Mitchell, | | |
| |Solorio | | |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Harkey, Donnelly, | | |
| |Nielsen, Norby, Wagner | | |
| | | | |
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SUMMARY : Authorizes, until June 30, 2015, the California
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
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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)Makes various statements of legislative intent.
3)Requires the Secretary of Business, Transportation and Housing
Agency (Secretary) to establish through the annual budget
process the level of funding for the LOSSAN corridor
operations and allocated in accordance with the ITA that
includes agreed upon rail services as well as funds for
marketing and administration.
4)Authorizes the LOSSAN corridor agency or regional entities to
augment service or to fund shortfalls when agreed upon
performance standards are not reached but prohibits a mandate
for them to do so.
5)Authorizes the LOSSAN corridor agency or local or regional
agencies to identify and secure new supplemental sources of
funding for the purpose of expanding or maintaining intercity
rail passenger service levels, including state and federal
intercity rail resources.
6)Authorizes local resources to be available to fund operating
deficiencies only if the local resources are dedicated by a
vote of the local agency providing the funds, with the
concurrence of the LOSSAN corridor agency.
7)Authorizes Caltrans to provide support services as agreed upon
by it and the LOSSAN corridor agency.
8)Requires operating costs to be controlled by using the Amtrak
cost allocation formula and the ability to contract out to
Amtrak or other rail operators.
9)Requires the Secretary to establish performance standards by
June 30, 2014, and to modify the standards by December 31,
2015, or the effective date of the ITA, whichever comes first.
Requires the Secretary to have the LOSSAN corridor agency
demonstrate its ability to meet the performance standards.
10)Authorizes Caltrans, pursuant to the Secretary-approved ITA,
to transfer to the LOSSAN corridor agency responsibility for
administering the state-funded intercity passenger rail
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services. Requires Caltrans to retain responsibility for
developing budget requests for the corridor through the state
budget process.
11)Establishes a deadline of June 30, 2015, for execution of the
ITA.
12)Specifies the provisions of the ITA to:
a) Include the date and conditions of transfer, including
the annual funding level.
b) Cover the initial three-year period and allow for the
level of funding to be extended upon mutual agreement.
c) Identify the funds to be transferred with the amounts
adjusted annually for inflation and in accordance with the
business plan.
d) Specify the level of service to be provided, the
Caltrans methods to ensure coordination of services with
other rail passenger services including feeder bus
services, and the methods for the annual review of the
business plan and annual funding and appropriation
proposals.
e) Describe the terms for transferring the car and
locomotive train sets and other equipment and property.
f) Describe auditing responsibilities and process
requirements as well as reimbursement and billing
procedures.
1)Requires the LOSSAN corridor agency to describe how it will
use the state funds allocated annually in its business plan
that is to be submitted to the Secretary for review and
recommendation by April 1 of every year. Deems the business
plan accepted by the state when approved by the Secretary.
Prescribes the requirements for the business plan. Requires
the LOSSAN corridor initial business plan to be consistent
with the immediately previous State Rail Plan as developed by
Caltrans.
2)Requires the Secretary to allocate state funds annually to the
LOSSAN corridor agency based upon the annual business plan and
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appropriation by the Legislature. Indicates that any
additional funds that are needed to operate the passenger rail
service may be provided by entities within the LOSSAN corridor
that receive service. Authorizes cost savings or farebox
revenues to be used for service improvements related to
intercity service. Requires the LOSSAN corridor agency to
report the fiscal results of the previous year's operations as
part of its annual business plan.
3)Requires that the level of service funded by the state to be
no less than the number of intercity round trips operated at
the effective date of the ITA, for a minimum three-year
period.
4)Establishes the level of funding provided by the state for
feeder bus service at substantially the same number of route
miles as the current feeder system at the effective date of
the ITA. Prohibits the ITA from not allowing the LOSSAN
corridor agency from reducing the number of feeder bus route
miles upon its determination that a route is not cost
effective.
5)States that the bill's provisions do not preclude expansion of
state-approved intercity passenger rail service.
6)Deems the LOSSAN corridor agency as an entity of the state,
allowing it to be a direct recipient federal public
transportation grants.
7)Requires the contractor operating the LOSSAN Corridor
services, as a contractual condition, to agree to abide by
federal railway labor laws.
8)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.
9)Stipulates that this 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
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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) Authorizes, until December 31, 1996, Caltrans, subject
to approval of the Secretary, to enter into an ITA under
which a Joint Powers Agency (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 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.
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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 : According to the Assembly Appropriations
Committee, one-time special fund cost to Caltrans in the range
of $200,000 to implement a transfer agreement with the LOSSAN
corridor agency, including supporting the transition of
Caltrans' equipment and facilities. Caltrans also indicates a
one-time payment of $300,000 to $400,000 would be made to the
LOSSAN corridor agency associated with the transfer of
operational and capital projects. Caltrans would thereafter
realize ongoing administrative savings of about $300,000.
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
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
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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 seven
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
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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,
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
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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.
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,
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.
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 January 1,
2014, upon which the state funding level amount is to be
maintained for a three-year period, the amount of Section 209
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funding by the state as indicated in the 2013-2014 state fiscal
year budget will determine the state's minimum allocation.
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),
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, 2015, 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
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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
business plan will provide a roadmap on how the entity will
proceed and provide some level of confidence to state decision
makers.
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.
However, this bill requires local approval prior to local
funds being used for operating funding deficiencies. Upon
transfer of the state-administered Pacific Surfliner route to
the LOSSAN JPA, should operating costs outpace revenues, 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 its 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
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corridor operations.
Analysis Prepared by : Ed Imai / TRANS. / (916) 319-2093
FN: 0005529