August 25, 2016

As CSAC reported last week, Senator Jim Beall and Assembly Member Jim Frazier unveiled legislative language for a unified transportation funding proposal. The proposal has now been amended into Senator Beall’s existing SBx1 1 and introduced in the Assembly transportation special session as ABx1 26 (Frazier). The bills would include over $2.5 billion in new funding for local streets and roads purposes, to be shared equally between cities and counties, as well as accountability measures and streamlining to enhance transportation project delivery.

CSAC has made the passage of a transportation reform and funding package that will produce a sufficient amount of new revenue to address the $78 billion ten-year unmet funding needs of the local street and road system a priority for the 2015-16 session. In June 2015, the Governor called an extraordinary session on transportation and infrastructure development that can remain open until the end of the two-year legislative session on November 30, 2016. While CSAC has supported a variety of transportation funding and reform bills proposed in the regular session and the special session, a comprehensive deal that could garner the required two-thirds vote of the Legislature has remained elusive.

CSAC’s detailed analysis of the bill’s provisions as they relate to local streets and roads is available online. Senator Beall and Assembly Member Frazier’s proposal would result in an estimated increase of over $2.5 billion in funding for county roads and city streets on an annual basis. Specifically, the proposal would provide:

• $1.9 billion from a 17-cent gas tax increase, a $38 increase on vehicle registration fees, and a new $165 registration fee on zero emission vehicles;
• $440 million, at full implementation, from the return of weight fees to transportation projects (these funds currently are used to backfill funds allocated for transportation bond debt service and would be returned to transportation projects in increments of $200 million per year over five years);
• $495 million from resetting the price-based excise tax to its initial 17.3-cent level under the 2010 gas tax swap; and
• $44 million from returned non-highway/OHV related price-based excise tax revenues to transportation projects.
• In addition, local streets and roads would receive one-time revenues of $351.5 million in transportation loan repayments.

CSAC staff calculate that the proposal would result in $2.3 billion in new, on-going revenue at full implementation of the package, and $500 million in additional annual funding due to restoration of the price-based gas tax rate. In total, counties would receive half of over $2.5 billion in new annual revenue upon full implementation of the proposal.

Outside of the revenue provisions, the bill includes familiar accountability measures, including maintenance of effort requirement and project reporting to the California Transportation Commission. In terms of local project streamlining, the bill would expand an existing CEQA exemption available to small cities and counties for maintenance, rehabilitation and safety projects in the existing right-of-way to all local jurisdictions in the state, and create a transportation advanced mitigation program.

Finally, the bill maintains a similar list of eligible project types from prior legislative proposals this year, including road maintenance and rehabilitation, safety projects, railroad grade separations, and complete street components—including active transportation, pedestrian and bike safety projects, transit facilities, and drainage and stormwater capture projects—built in conjunction with any other allowable project. Funding from the bill could also be used as matching funds for state and federal funding programs.

CSAC appreciates the work that went into pulling together funding and reform plans from the chairs of both legislative transportation committees. Nevertheless, significant work remains to secure the two-thirds votes required in both houses to bring much-needed new revenue to local and state transportation program. CSAC will continue to advocate for the approval of the package during the final week of the legislative session, however, we are also developing strategies to pursue approval of a funding and reform package prior to the expiration of the special session at the end of November.