BILL ANALYSIS �
SB 1077
Page 1
SENATE THIRD READING
SB 1077 (DeSaulnier)
As Amended August 21, 2014
Majority vote
SENATE VOTE :23-11
TRANSPORTATION 10-4 APPROPRIATIONS 12-5
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|Ayes:|Lowenthal, Achadjian, |Ayes:|Gatto, Bocanegra, |
| |Ammiano, Bloom, Bonta, | |Bradford, |
| |Buchanan, Daly, Gatto, | |Ian Calderon, Campos, |
| |Holden, Nazarian | |Eggman, Gomez, Holden, |
| | | |Pan, Quirk, |
| | | |Ridley-Thomas, Weber |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Linder, Patterson, |Nays:|Bigelow, Donnelly, Jones, |
| |Quirk-Silva, Waldron | |Linder, Wagner |
| | | | |
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SUMMARY : Creates a Road Usage Charge (RUC) Technical Advisory
Committee to guide development and implementation of a pilot
program to study the potential for RUC as an alternative to the
gas tax. Specifically, this bill :
1)Makes legislative findings and declarations regarding the
inadequacy of the gas tax to meet California's long-term
revenue needs for transportation and the need to explore a RUC
program as an alternative to the antiquated gas tax system now
in place.
2)Creates a 15-member technical advisory committee to be
convened by the California Transportation Commission (CTC).
3)Directs the technical advisory committee to study RUC
alternatives to the gas tax and to guide development and
evaluation of a pilot program to test RUC approaches.
4)Directs the California State Transportation Agency (CalSTA) to
implement, by January 1, 2017, a pilot program, based on
guidance from the technical advisory committee, to identify
and evaluate issues related to potential implementation of a
RUC program.
SB 1077
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5)Requires CalSTA to submit a report on the pilot program to the
technical advisory committee, CTC, and the Legislature, by
January 1, 2018.
6)Sunsets and is repealed on January 1, 2019.
FISCAL EFFECT : According to the Assembly Appropriations
Committee:
1)One-time costs to support the technical advisory committee
would be about $350,000 for two positions. Additional costs to
hold some technical advisory committee meetings throughout the
state would depend on the number of meetings, but could total
in the low hundreds of thousands of dollars.
2)One-time costs for the pilot project would depend in part on
the number of vehicles and locations involved. The California
Department of Transportation (Caltrans) estimates a cost of
anywhere from $1 million to $20 million. Given the significant
impact that changing to a RUC system would have on the state,
it is assumed the study should be as representative as
possible, which implies a cost at the higher end of Caltans'
range.
COMMENTS : Since 1923, California, and the rest of the nation,
has relied heavily on gas taxes to support its local streets and
roads and state highway system. Gas taxes have the benefit of
being fairly inexpensive to administer. Furthermore, until
recently, they have been a reasonably equitable means of
distributing the tax burden amongst drivers in rough proportion
to their use of the roadway system. The gas tax is no longer a
viable, sustainable revenue source, however. According to the
Institute on Taxation and Economic Policy, two important
developments have combined to greatly reduce the functionality
of the gas tax:
1)The purchasing power of gas tax revenues has declined
significantly due to inflation. If current tax rates, set in
1994, remain unchanged through 2035, real gas tax revenue will
have declined by over 40%; and,
2)Improvements in vehicle fuel efficiency have cut directly into
gas tax revenues by allowing drivers to travel farther
distances while buying less gasoline. From an environmental
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and energy policy standpoint, this is undeniably desirable.
Decreased fuel consumption reduces greenhouse gasses and our
dependence on foreign oil. But with vehicle fuel efficiency
set to nearly double in the next 20 years, gas tax revenues
will be cut nearly in half.
In the face of rapidly declining gas tax revenues, many have
implored state legislatures and Congress to raise state and
federal gas tax rates. However, raising the gas tax rate is not
a long-term viable funding solution nor does it support the
state's policies goals. An alternative to the gas tax must be
found. The alternative most often cited across the nation is
RUCs.
This bill provides for a rigorous, independent review of a
potential RUC system. Although the technical advisory committee
and pilot program will likely consume substantial resources, the
significance of this effort should not be underestimated.
Billions of dollars of lost gas tax revenue are at stake. For
more than a decade CTC has raised concerns with respect to the
decline and instability of gas tax revenues. It has urged that
the Legislature and the Administration to consider
implementation of a RUC system to address California's
transportation needs. This bill will finally begin to answer
that call.
Please see the policy committee analysis for a full discussion
of this bill.
Analysis Prepared by : Janet Dawson / TRANS. / (916) 319-2093
FN: 0005128