BILL ANALYSIS
SB 1847
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Date of Hearing: June 22, 1998
ASSEMBLY COMMITTEE ON TRANSPORTATION
Kevin Murray, Chairman
SB 1847 (Schiff) - As Amended: July 6, 1998
SENATE VOTE: 27-4
SUBJECT : Pasadena Metro Blue Line Construction Authority
SUMMARY : This measure would create the Pasadena Metro Blue Line
Construction Authority (authority) and direct the authority to
award and administer all design and construction contracts for the
completion a 13.6-mile light rail line between downtown Los
Angeles and the City of Pasadena. Specifically, this bill :
1) Provides that the authority is created for the purpose of
awarding and overseeing all design and construction contracts
that are necessary for the completion of the project as
defined in #3.
2) Specifies that the authority shall have all the powers
necessary for planning, acquiring, leasing, developing,
jointly developing, owning, controlling, using, jointly using,
disposing of, designing, procuring, and building the project.
3) Defines the "project" as the Los Angeles-Pasadena Metro Blue
Line light rail project extending from Union Station in the
City of Los Angeles to Sierra Madre Villa Boulevard in the
City of Pasadena and any mass transit guideway that may be
planned east of Sierra Madre Villa Boulevard along the rail
right-of-way extending to the City of Claremont.
4) Specifies that the authority shall have a governing board
consisting of five voting members and one nonvoting member who
shall be appointed as follows:
a) Three members appointed by the Los Angeles, Pasadena, and
South Pasadena City Councils.
b) One member appointed by the president of the governing
board of the San Gabriel Valley Council of Governments.
c) One member appointed by the Los Angeles County Metropolitan
Transportation Authority (MTA).
d) The nonvoting member shall be appointed by the Governor.
5) Specifies that all members of the board shall serve a term of
not more than four years, with no limit on the number of
terms. The bill further provides that the board, by a
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two-thirds vote, may appoint an alternate member for the
purpose of filling a vacancy.
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6) Provides that each member of the board may be compensated for
attendance to board meetings at a rate of not more than $150
per day with a maximum of $600 per month.
7) Authorizes the board to appoint an executive director who
shall serve at the pleasure of the authority. The bill also
specifies the executive director shall be exempt from civil
service and that the board shall establish the salary.
8) Specifies that all contracts shall be awarded based on price
by competitive bid and in accordance with state procurement
law.
9) Directs the MTA to expeditiously enter into an agreement with
the authority to hold all real property in trust.
10) Requires that any transfer of funds by the MTA under this
section be subject to the terms of the memorandum of
understanding entered into between the MTA and the California
Transportation Commission on June 2, 1998.
11) Provides that the authority is eligible to receive allocations
of state funds to the project. The bill also requires that
the unencumbered balance of funds currently programmed to the
MTA for completion of the project shall be allocated to the
authority pursuant to a transfer agreement between the
authority and the Department of Transportation (Caltrans).
12) Specifies that the authority shall have the duty to:
a) Conduct all the financial studies, planning and
engineering necessary to complete the project.
b) Adopt an administrative code not later than 60 days after
the establishment of the authority.
c) Complete a detailed management, implementation, safety and
financial plan. The financial plan shall include a full
funding program which, along with the other plans, must be
completed and submitted to the Governor within 90 days
after the establishment of the authority.
13) Requires that the authority make reasonable progress, as
determined by the California Transportation Commission, in the
design and construction of the project within the timetable of the
1998 State Transportation
Improvement Program (STIP).
14) Requires the authority and the MTA to enter into a memorandum
of understanding to specifically address the ability of the
MTA to review any
significant changes in the scope and design of the project.
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15) Prohibits the authority from encumbering any future farebox
revenues that may be generated from the operation of the project.
The authority would also be prohibited from encumbering the
project with any obligation that is transferable to the MTA
upon completion of design and construction of the project.
EXISTING LAW establishes the Los Angeles County Metropolitan
Transportation Authority (MTA) as the single successor agency to
the Southern California Rapid Transit District and the Los Angeles
County Transportation Commission. The authority is responsible
for most transit guideway projects in Los Angles County and has
specified duties and responsibilities with regard to
transportation.
FISCAL EFFECT : Unknown
COMMENTS : This measure is sponsored by the author.
The MTA was created by AB 152 (Katz), Chapter 60, Statutes of
1992, through the consolidation of the Los Angeles County
Transportation Commission and the Southern California Rapid
Transit District.
Under current law, the MTA has the sole authority to program
transportation funds for Los Angeles County. As the regional
transportation planning agency (RTPA), the MTA programs millions
of dollars in funds. In addition, the MTA administers the local
sales tax initiatives after receiving the collected funds from the
state.
It is important to note that the delivery and implementation of
all projects and programs is dependent on the availability of
local, state, and federal revenues at the projected levels. Major
changes in local, state or federal policy or unanticipated shifts
in the economy would have an impact the delivery of regionally
significant projects.
The agency is also responsible for the operation of a transit bus
fleet of about 2,400 buses. On October 9, 1996, a federal judge
issued a consent decree in litigation filed by the NAACP and other
bus advocacy groups which requires the MTA to increase the number
and frequency of buses to reduce overcrowding and to reduce the
costs of monthly bus passes.
Since its inception, the MTA has experienced serious problems
primarily with the construction of the Metro Rail Red Line, a
multi-billion dollar subway system funded by local, state and
federal revenues. In addition to construction problems, ranging
from tunnel fires, structural failures and even deaths, the
embattled agency has experienced financial problems, including
funding shortfalls for the Red Line caused in part by overly
optimistic revenue projections.
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In December of 1996, the Federal Transit Administration (FTA)
expressed serious concerns about the MTA's ability to fulfill its
obligations under the Metro Rail Red Line full funding agreement.
In turn, the MTA was called upon
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to submit a "recovery plan" which would demonstrate that the MTA
could complete the federally-funded project and also respond
aggressively to the to the consent decree. This plan was rejected
by the Federal Transit Administrator Gordon Linton who commented
that the plan made " . . . questionable assumptions. . . " The
MTA was then directed to submit a more detailed plan which would
include a financial assessment of all the agency's rail, bus and
highway commitments. The FTA required that the MTA submit this
plan as a condition for receiving federal funds.
In response, the MTA prepared a new "restructuring plan," in an
attempt to comply with a new federal requirement to produce the
plan as a condition of receiving funds. As part of the strategy
for its restructuring plan, the MTA board of directors voted to
suspend construction on all but one of the major heavy rail
construction projects that it had once planned to build. One of
the projects that was suspended was the Metro Rail Pasadena Blue
Line.
At the state level, the MTA has entered into a Memorandum of
Understanding with the California Transportation Commission (CTC)
to, among other things, produce a fully-funded plan to provide
transit service throughout the region. The MTA must produce this
plan to the CTC by December 2, 1998, as a condition of receiving
state funds.
The author's office indicates that SB 1847 was introduced in order
to take advantage of innovative opportunities to complete what was
once a construction priority for the MTA. Supporters of the
measure point out that the light rail line could be built far more
cost-effectively by a streamlined, single-purpose joint powers
construction authority.
While the idea of creating a single-purpose, low overhead
construction authority may appear to provide an innovative and
more attractive alternative to suspending construction on the
Pasadena Blue Line, it is not clear that the authority would
experience enough cost savings to fill the current funding
shortfall.
Under the bill, approximately $270 million in state funds and $88
million in local funds would be transferred to the authority. The
author's office contends that the authority could experience
approximately $100 million in savings from overhead reduction.
However, there would still be a need for approximately $150
million to fully fund the project. Supporters of the measure have
indicated that the authority would pursue innovative financing
strategies to address the funding shortfall.
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REGISTERED SUPPORT / OPPOSITION :
Support
California Institute of Technology
City of Claremont
City of Pasadena
City of South Pasadena
EarthLink Network
Independent Cities Association
League of California Cities, Los Angeles County Division
Mount Washington Association
Pasadena Chamber of Commerce
Pasadena Civic Center West
San Gabriel Valley Economic Council
Opposition
Labor/Community Strategy Center and the Bus Riders Union
Analysis prepared by : Andrew K. Antwih/ atrans / (916) 319-2093
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