BILL ANALYSIS
SB 1847
Page 1
SENATE THIRD READING
SB 1847 (Schiff)
As Amended August 11, 1998
Majority vote
SENATE VOTE : 27-4
TRANSPORTATION 20-1 APPROPRIATIONS 21-0
Ayes: Murray, Baugh, Baca, Bowler,Ayes:Migden, Ashburn, Ackerman,
Cardenas, Figueroa, Havice, Runner, Baca, Brewer,
Cardenas,
Lempert, Margett, Mazzoni, Escutia, Granlund,
Hertzberg,
Morrow, Napolitano, Oller, Kuehl, Machado, Olberg,
Keeley,
Perata, Poochigian, Runner, Poochigian, Shelley,
Scott, Bordonaro, Torlakson, Strom-Martin, Sweeney,
Wayne Thompson, Thomson, Lempert
Nays: McClintock
SUMMARY : Creates 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 below.
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;
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c) One member appointed by the Los Angeles County Metropolitan
Transportation Authority (MTA); and
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. Provides that the board, by a two-thirds vote, may
appoint an alternate member for the purpose of filling a
vacancy.
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. 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 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 MTA under this section
be subject to the terms of the memorandum of understanding
entered into between 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. Requires that the unencumbered
balance of funds currently programmed to 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, including a code of conduct
for employees and board members, not later than 60 days
after the establishment of the authority; and
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
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determined by the California Transportation Commission, in the
design and construction of the project within the timetable of the
1998 State Transportation
Improvement Program.
14) Requires the authority and MTA to enter into a memorandum of
understanding to specifically address the ability of MTA to
review any
significant changes in the scope and design of the project.
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.
16) Requires that the authority shall be dissolved upon completion
of construction of the light rail project. MTA shall assume
responsibility for operating the project upon dissolution of
authority.
EXISTING LAW establishes the Los Angeles County 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.
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, MTA has the sole authority to program
transportation funds for Los Angeles County. As the regional
transportation planning agency (RTPA), MTA programs millions of
dollars in funds. In addition, 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 MTA to increase the number and
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frequency of buses to reduce overcrowding and to reduce the costs
of monthly bus passes.
Since its inception, 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.
In December of 1996, the Federal Transit Administration (FTA)
expressed serious concerns about MTA's ability to fulfill its
obligations under the Metro Rail Red Line full funding agreement.
In turn, MTA was called upon to submit a "recovery plan" which
would demonstrate that 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. . ." 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. FTA required
that MTA submit this plan as a condition for receiving federal
funds.
In response, 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, 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, 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. 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 this bill was introduced in
order to take advantage of innovative opportunities to complete
what was once a construction priority for 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.
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Under this 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.
Analysis prepared by : Andrew K. Antwih/ atrans / (916) 319-2093
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