Amended in Assembly March 28, 2014

California Legislature—2013–14 Regular Session

Assembly Bill No. 2653

Introduced by Assembly Member Linder

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(Coauthors: Assembly Members Allen, Bigelow, Conway, Beth Gaines, Gorell, Hagman, Harkey, Jones, Melendez, Olsen, Patterson, Wagner, and Wilk)

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February 21, 2014

An act to amend begin delete Section 163 end delete begin insert Sections 183.1 and 2103 end insert of the Streets and Highways Code, relating to transportation begin insert , and making an appropriation therefor end insert .

LEGISLATIVE COUNSEL’S DIGEST

AB 2653, as amended, Linder. Transportation begin delete funds. end delete begin insert finance end insert begin insert . end insert

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(1) Article XIX of the California Constitution restricts the use of fuel excise tax revenues imposed by the state on fuels used in motor vehicles upon public streets and highways to expenditure on highway and certain mass transit purposes. Existing law provides for the deposit of these revenues in the Highway Users Tax Account, and appropriates those revenues to various purposes. Existing law, with respect to the portion of these revenues that is derived from increases in the motor vehicle fuel excise tax beginning in 2010, requires an allocation to reimburse the State Highway Account for the amount of weight fee revenues that the State Highway Account is not receiving due to use of weight fee revenues to pay debt service on transportation general obligation bonds and to make certain loans, with the remaining amount of this portion of revenues allocated 44% to the State Transportation Improvement Program, 12% to the State Highway Operations and Protection Program, and 44% to city and county streets and roads.

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This bill would delete the provisions allocating revenues derived from the increased motor vehicle fuel excise tax to State Highway Account reimbursement, the State Transportation Improvement Program, and the State Highway Operations and Protection Program. The bill would instead provide for the Controller to apportion all of these revenues to cities and counties for local streets and roads pursuant to a specified formula, thereby making an appropriation.

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(2) Existing law, commencing with the 2013-14 fiscal year, requires certain revenues deposited in the State Highway Account that are not restricted as to expenditure by Article XIX of the California Constitution to be transferred to the Transportation Debt Service Fund in the State Transportation Fund for payment of current year debt service on certain transportation general obligation bonds.

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This bill would delete the transfer of these revenues to the Transportation Debt Service Fund, and would instead provide for appropriation in the annual Budget Act of 44% of these revenues to the State Transportation Improvement Program, 12% to the State Highway Operations and Protection Program, and 44% to city and county streets and roads pursuant to a specified formula.

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Existing law establishes a policy for expenditure of certain state and federal funds available to the state for transportation purposes. Under this policy, the Department of Transportation and the California Transportation Commission are required to develop a fund estimate of available funds for purposes of adopting the state transportation improvement program, which is a listing of capital improvement projects. Existing law requires the estimate of annual expenditures for local assistance to be the amount required to fund local assistance programs required by state or federal law or regulations.

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This bill would make a nonsubstantive change to this provision.

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Vote: majority. Appropriation:  begin delete no end delete begin insert yes end insert . Fiscal committee:  begin delete no end delete begin insert yes end insert . State-mandated local program: no.

The people of the State of California do enact as follows:

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begin insert SECTION 1. end insert   

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begin insert Section 183.1 of the end insert begin insert Streets and Highways Code end insert
begin insert is amended to read: end insert

183.1.  

(a) Notwithstanding subdivision (a) of Section 182 or
any other provision of law, money deposited into the account that
is not subject to Article XIX of the California Constitution,
including, but not limited to, money that is derived from the sale
of documents, charges for miscellaneous services to the public,
condemnation deposits fund investments, rental of state property,
or any other miscellaneous uses of property or money, may be
used for any transportation purpose authorized by statute, upon
appropriation by the Legislature or, after transfer to another fund,
upon appropriation by the Legislature from that fund.

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(b) Commencing with the 2013-14 fiscal year, and not later
than November 1 of each fiscal year thereafter, based on prior year
financial statements, the Controller shall transfer the funds
identified in subdivision (a) for the prior fiscal year from the State
Highway Account to the Transportation Debt Service Fund in the
State Transportation Fund, and those funds are continuously
appropriated for the purposes specified for the Transportation Debt
Service Fund.

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(b) The funds identified in subdivision (a) shall be appropriated
in the annual Budget Act as follows:

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(1) Forty-four percent to fund projects in the State
Transportation Improvement Program.

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(2) Twelve percent to fund projects in the State Highway
Operation and Protection Program.

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(3) Forty-four percent to be apportioned by the Controller for
local street and road purposes pursuant to the formula in
subdivision (a) of Section 2103.

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begin insert SEC. 2. end insert   

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begin insert Section 2103 of the end insert begin insert Streets and Highways Code end insert begin insert is
amended to read: end insert

2103.  

(a) Notwithstanding Section 13340 of the Government
Code, begin delete of end delete the net revenues deposited to the credit of the Highway
Users Tax Account that are derived from the increases in the rates
of taxes that are imposed pursuant to subdivision (b) of Section
7360 and Section 7361.1 of the Revenue and Taxation Code begin delete , all
of the following shall occur on a monthly basis: end delete begin insert shall be
apportioned by the Controller for local street and road purposes
as follows: end insert

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(1) (A) By the 15th day of every month, the Treasurer’s office,
in consultation with the Department of Finance, shall notify the
Controller of the amount of debt service that will be paid on each
transportation bond during that month.

(B) Within two business days following the 28th day of each
month, the Controller shall transfer to the Transportation Debt
Service Fund an amount equal to the amount of monthly debt
service paid by the General Fund on any bonds issued pursuant to
the Seismic Retrofit Bond Act of 1996 (Chapter 12.48
(commencing with Section 8879) of Division 1 of Title 2 of the
Government Code) or any other bonds issued for highway or
eligible guideway projects consistent with the requirements
applicable to the expenditure of revenues under Article XIX of the
California Constitution as identified by the Department of Finance
pursuant to Section 16965 of the Government Code, and
three-quarters of the amount of monthly debt service paid on any
bonds issued pursuant to the Highway Safety, Traffic Reduction,
Air Quality, and Port Security Bond Act of 2006 (Chapter 12.49
(commencing with Section 8879.20) of Division 1 of Title 2) for
reimbursement of the General Fund for these costs. If revenues
available pursuant to this subdivision in any given month are
insufficient to fully reimburse the General Fund for the debt service
payments made, the first revenues available pursuant to this
subdivision in the following month or months shall be transferred
to the Transportation Debt Service Fund so that all debt service
payments made on these bonds from the General Fund in a given
fiscal year are fully reimbursed. However, no further transfers
shall be made pursuant to this subparagraph once the transfers for
the months of July to October, inclusive, in 2010 have been made.
Any transfers made from the net revenues identified in this
paragraph for highway and eligible guideway bond debt service
for months after October 2010 shall be reversed and shall instead
be made from weight fee revenues in the State Highway Account,
as described in subparagraph (F).

(C) Beginning November 2, 2010, the Controller shall transfer
to the State Highway Account within two business days following
the 28th day of each month all of the monthly net revenues
identified in subparagraph (B) that were designated for highway
and eligible guideway bond debt service reimbursement but that
have not been transferred, or that were transferred by means of a
transfer that was reversed, pursuant to that subparagraph. To the
extent the Controller has distributed any of those net revenues to
cities and counties pursuant to subparagraph (C) of paragraph (3)
between November 2, 2010, and March 24, 2011, the Controller
shall subsequently reduce the amount transferred to cities and
counties on a monthly basis pursuant to subparagraph (C) of
paragraph (3) and shall instead transfer these funds to the State
Highway Account until all of the revenues that would otherwise
have been transferred to the State Highway Account on and after
November 2, 2010, pursuant to this subparagraph have been so
transferred. For the 2011-12 fiscal year, the Controller shall
transfer to the State Highway Account within two business days
following the 28th day of each month an amount equal to the
weight fee revenues transferred to the Transportation Debt Service
Fund pursuant to subdivision (b) of Section 9400.4 of the Vehicle
Code, including forty-three million seven hundred thousand dollars
($43,700,000) authorized pursuant to Item 2660-013-0042 of
Section 2.00 of the Budget Act of 2011 and an amount equal to
weight fee revenues transferred to the General Fund as a loan
pursuant to subdivision (b) of Section 9400.4 of the Vehicle Code.
To the extent the Controller has distributed any of those revenues
to cities and counties pursuant to subparagraph (C) of paragraph
(3), the Controller shall subsequently reduce the amount transferred
to cities and counties on a monthly basis pursuant to subparagraph
(C) of paragraph (3) and instead transfer these funds to the State
Highway Account until all of the revenues that would otherwise
have been transferred to the State Highway Account in the 2011-12
fiscal year pursuant to this subparagraph have been so transferred.

(D) Notwithstanding subparagraph (C), commencing with the
2012-13 fiscal year and every fiscal year thereafter, the Controller
shall transfer to the State Highway Account within two business
days following the 28th day of each month an amount equal to the
amount of weight fee revenues transferred to the Transportation
Debt Service Fund for highway and eligible guideway bond debt
service and to the General Fund as a loan pursuant to subdivision
(c) of Section 9400.4 of the Vehicle Code.

(E) Beginning July 1, 2011, transfers made under subparagraphs
(C) and (D) during a fiscal year shall not exceed the annual revenue
generated from weight fees, as determined by Sections 9400.4 and
42205 of the Vehicle Code, at the rates in effect as of March 24,
2011, as determined by the Department of Finance.

(F) Any remaining amount of the highway or eligible guideway
bond debt service reimbursement authorized by this paragraph that
has not been made pursuant to subparagraph (B) on and after
November 2, 2010, shall instead be made pursuant to subdivisions
(a), (b), and (c) of Section 9400.4 of the Vehicle Code from
revenues in the State Highway Account derived from weight fees
deposited in the account pursuant to subdivision (e) of Section
9400.1 and Section 42205 of the Vehicle Code.

(2) (A) In the 2010-11 fiscal year, after the monthly transfer
made pursuant to paragraph (1), the sum of fifty-four million one
hundred sixty-seven thousand dollars ($54,167,000) per month
shall be held in the account for future appropriation by the
Legislature.

(B) Notwithstanding any other provision of law, with respect
to the monthly net revenues described in subparagraph (A), no
further transfers of these revenues for the purpose of loans to the
General Fund shall be made pursuant to Item 2660-011-0062 of
Section 2.00 of the Budget Act of 2010 once the loan transfers for
the months of July to October, inclusive, in 2010 have been made.
Notwithstanding the loan repayment date specified in the
provisional language for that item, the funds loaned shall be repaid
by June 30, 2021. Any transfers made from the monthly net
revenues in subparagraph (A) for months after October 2010 shall
be reversed and shall instead be made from weight fee revenues
in the State Highway Account, as described in subparagraph (D).
The revenues from loan repayments shall be held in the Highway
Users Tax Account for future appropriation by the Legislature.

(C) Beginning November 2, 2010, all of the monthly net
revenues described in subparagraph (A) shall instead be transferred
by the Controller to the State Highway Account within two
business days following the 28th day of each month. To the extent
that the Controller has distributed any of the revenues identified
in this paragraph to cities and counties pursuant to subparagraph
(C) of paragraph (3) between October 14, 2010, and March 24,
2011, the Controller shall subsequently reduce the amount
transferred to cities and counties on a monthly basis pursuant to
subparagraph (C) of paragraph (3) and shall instead transfer these
funds to the State Highway Account until all of the revenues that
would have been transferred to the General Fund as a loan pursuant
to Item 2660-011-0062 of Section 2.00 of the Budget Act of 2010
on and after November 2, 2010, have instead been transferred to
the State Highway Account.

(D) Any remaining amount of the loans to the General Fund
authorized pursuant to Item 2660-011-0062 of Section 2.00 of the
Budget Act of 2010 that has not been made pursuant to
subparagraph (B) on and after November 2, 2010, shall instead be
made pursuant to subdivisions (a), (b), and (c) of Section 9400.4
of the Vehicle Code from revenues in the State Highway Account
derived from weight fees deposited in the account pursuant to
subdivision (e) of Section 9400.1 and Section 42205 of the Vehicle
Code.

(3) The Controller shall transfer any remaining net revenues
subject to this subdivision as follows:

(A) Forty-four percent shall be transferred to the State Highway
Account to fund projects in the State Transportation Improvement
Program that are consistent with Section 1 of Article XIX of the
California Constitution, except in the 2010-11 fiscal year, 50
percent shall be transferred for purposes of this subparagraph.

(B) Twelve percent shall be transferred to the State Highway
Account to fund projects in the State Highway Operation and
Protection Program, except in the 2010-11 fiscal year, no revenues
shall be transferred for purposes of this subparagraph.

(C) Forty-four percent shall be apportioned by the Controller
for local street and road purposes, except in the 2010-11 fiscal
year, 50 percent shall be transferred for purposes of this
subparagraph as follows:

(i)

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begin insert (1) end insert  Fifty percent shall be apportioned by the Controller to cities,
including a city and county, in the proportion that the total
population of the city bears to the total population of all the cities
in the state.

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(ii)

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begin insert (2) end insert  Fifty percent shall be apportioned by the Controller to
counties, including a city and county, in accordance with the
following formulas:

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(I)

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begin insert (A) end insert  Seventy-five percent shall be apportioned among the
counties in the proportion that the number of fee-paid and exempt
vehicles that are registered in the county bear to the number of
fee-paid and exempt vehicles registered in the state.

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(II)

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begin insert (B) end insert  Twenty-five percent shall be apportioned among the counties
in the proportion that the number of miles of maintained county
roads in each county bear to the total number of miles of
maintained county roads in the state. For the purposes of
apportioning funds under this subparagraph, any roads within the
boundaries of a city and county that are not state highways shall
be deemed to be county roads.

(b) After the begin delete transfers or other actions end delete begin insert apportionments end insert pursuant
to subdivision (a), at least 90 percent of the balance deposited to
the credit of the Highway Users Tax Account in the Transportation
Tax Fund by the 28th day of each month shall be apportioned or
transferred, as applicable, by the Controller by the second working
day thereafter, except for June, in which case the apportionment
or transfer shall be made the same day. These apportionments or
transfers shall be made as provided for in Sections 2104 to 2122,
inclusive. If information is not available to make the apportionment
or transfer as required, the apportionment or transfer shall be made
on the basis of the information of the previous month. Amounts
not apportioned or transferred shall be included in the
apportionment or transfer of the subsequent month.

(c) Notwithstanding any other law, the funds apportioned by
the Controller to cities and counties pursuant to begin delete subparagraph (C)
of paragraph (3) of end delete subdivision (a) are not subject to Section 7104
or 7104.2 of the Revenue and Taxation Code. These funds may
be expended for any street and road purpose consistent with the
requirements of this chapter.

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SECTION 1.  

Section 163 of the Streets and Highways Code
is amended to read:

163.  

The Legislature, through the enactment of this section,
intends to establish a policy for the use of all transportation funds
that are available to the state, including the State Highway Account,
the Public Transportation Account, and federal funds. For the
purposes of this section, “federal funds” means any obligational
authority to be provided under annual federal transportation
appropriations acts. The department and the commission shall
prepare fund estimates pursuant to Sections 14524 and 14525 of
the Government Code based on the following:

(a) Annual expenditures for the administration of the department
shall be the same as the most recent Budget Act, adjusted for
inflation.

(b) Annual expenditures for the maintenance and operation of
the state highway system shall be the same as the most recent
Budget Act, adjusted for inflation and inventory, or, when a
maintenance plan has been enacted pursuant to Section 164.6,
maintenance expenditures shall be based on planned expenditures
in that plan.

(c) Annual expenditure for the rehabilitation of the state highway
system shall be the same as the most recent Budget Act, or, when
a long-range rehabilitation plan has been enacted pursuant to
Section 164.6, shall be based on planned expenditures in that
long-range plan.

(d) Annual expenditures for local assistance shall be the amount
required to fund local assistance programs required by state or
federal law or regulations, including, but not limited to, railroad
grade crossing maintenance, bicycle transportation account
projects, congestion mitigation and air quality, regional surface
transportation programs, local highway bridge replacement and
rehabilitation, local seismic retrofit, local hazard elimination and
safety, and local emergency relief.

(e) After deducting expenditures for administration, operation,
maintenance, local assistance, safety, and rehabilitation pursuant
to subdivisions (a), (b), (c), and (d), and for expenditures pursuant
to Section 164.56, the remaining funds shall be available for capital
improvement projects to be programmed in the state transportation
improvement program.

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