SR-20080513-1F~~~
~;tYOf City Council Report
Santa Monica
City Council Meeting: 5-13-08
Agenda Item: ~-~
To: Mayor and City Council,
From: Kathryn Vernez, Assistant to the City Manager for .Community.: and
Government Relations
Subject: Support for Transportation Infrastructure legislation proposed by Assembly
Member Mike Feuer
Recommended Action
It is recommended that the City Council confirm support for transportation infrastructure
legislation proposed by Assembly Member Mike Feuer which creates new financing
tools to fund needed transportation projects and direct staff to advocate for their
passage.
Executive Summary
Council requested that staff review the package. of transportation bills proposed by
Assembly Member Feuer. Clear direction had been given on ACA 10, a constitutional
amendment to lower the bond vote threshold, and city advocacy began on that
measure. The remaining bills add new financing tools to fund critical infrastructure
projects but require new policy direction from Council. Additionally, AB 2321 while a
new version of a bill previously supported by Council now deletes Expo's first call on
federal funds. Metro contends this decision would need to be made by the Metro Board
and not stipulated in state legislation. After discussions with Metro staff and our
legislative representatives, staff can recommend. Council support on all the measures.
The current state fiscal crisis demonstrates that local government needs new authority
to enact its own sources of funding for critically needed projects and these bills provide
LA County with the means to do so.
Discussion
Assembly Member Mike Feuer (D -Los Angeles) introduced a package of bills in 2008
to address state, regional and local transportation infrastructure funding needs. A full
summary report on the measures was submitted by the city's lobbyist. Council
requested that staff review the bills for consistency with Council policy. Several of the
bills introduce new financing tools that require an affirmative direction from the Council
and are in keeping with the city's sustainability goals.
AB 1836 (Feuer) This bill removes voter approval for Infrastructure Financing Districts
(IFD) making these similar to Redevelopment agencies. Local agencies that will
contribute their property tax increment revenue to the IFD must still approve the plan.
AB 1836 authorizes cities to create IFD's and issue bonds for community public works
such as transit, water systems, flood control, parks and solid waste facilities.
AB 2321 (Feuer) Cleanup language to SB 314 (Murray, 2003) which created additional
authority for the Los Angeles County Metropolitan Transportation Authority (Metro) to
place a half cent sales tax on the ballot with specific conditions such as preparation of
an expenditure plan prior to submitting the measure to voters, describing the projects
and programs in the Long Range Transportation Plan. This bill, sponsored by Metro,
would allow the taz to be imposed for a period not to exceed 30 years. However, the
bill also deletes a provision that required the Exposition Boulevard Light Rail Transit
Project to "be the first priority for federal funding received for the capital projects"
designated in the original bill, or have "first call" on federal funds. While this somewhat
diminishes Expo's standing, it is true that the Metro Board determines regional priorities
for federal funding and financing allocation amongst sources of funding. Metro staff
argued that deleting Expo's "first call" on federal funds might save the project 18- 24
months in negotiating a federal full funding grant agreement if local sales tax revenues .
raised by this measure are allocated to Expo, thus expediting service. They also said
however, the Board may want to combine the high ridership of Expo with other projects
to enable other projects to be eligible for federal funds. So it is not clear which outcome
would be chosen by the Board. Nonetheless, the bill is estimated to generate. $30 billion
over the course of 30 years and Expo is listed for $925,000,000. On balance the merits
of passing the bill in a county-wide election outweigh the concern over deleting the "first
call" language. Further, the city will continue to advocate that Expo Phase 2 to Santa
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Monica remain Metro's next priority project in the funded portion of the Long Range
Transportation Plan.
AB 2388 (Feuer) would create an additional Vehicle License. Fee as a surcharge on the
registration fees for every passenger vehicle based on carbon dioxide emissions and
the weight of the vehicle. The revenue generated would go to projects to mitigate the
effects of carbon emissions, wear and tear on roads and to ease traffic congestion. It is
consistent with Council sustainability goals and represents a new policy tool.
AB 2558 (Feuer) would authorize. a carbon emissions fee subject to voter approval.
Metro would decide whether the fee would be assessed at the pump or through the
Vehicle License Fee. The author's office estimates that $400 million to $600 million
would be generated to pay for public transit, and congestion management projects and
programs.
CO2 emission reduction goals were adopted by Council on October 24, 2006 for the
entire community and for-city operations {see
http://www.smpov.net/cityclerk/council/agendas/2006/20061024/s2006102408-B htm
for the staff report). While many of the actions that will be required to reach those
targets are not yet specified, carbon emission fees are one way to address the city's
goals for climate protection and regional air pollution reduction.
The Council has adopted incentive-based user fees that have a similar philosophy to
the CO2 emissions surcharge proposed in the Feuer bills. Examples are: 1) tiered rate
structures for water and solid waste that provide a disincentive for wasting water or
generation of landfill waste; 2) water demand mitigation fees for new developments that
fund water conservation programs designed to address the impacts on the water supply
from the new development; and 3) diversion requirements for construction and
demolition waste generation.
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Language from the SCP Guiding Principles is also related:
e City decision-making will be guided by a mandate to maximize environmental benefits
and reduce or eliminate negative environmental impacts.
• The City will also act as a strong advocate for the development and implementation of
model programs and innovative approaches by regional, state and federal government
that embody the goals of sustainability.
Carbon dioxide emissions and carbon emissions are a chief cause of global warming
and of particular concern in Los Angeles County. Carbon emissions from passenger
vehicles contribute to Los Angeles' poor air quality and our countywide public transit
system is inadequate. According to the National Resources Defense Council,
statewide, carbon dioxide and other emissions from cars and light trucks are
responsible for one third of climate change pollution.
In addition to creating incentives, the bill includes provision to spend the funds collected
to mitigate global warming. According to committee analysis," AB 2558 is predicated
on the idea that promoting the construction and use of public transit is an important
means for Los Angeles County to use in addressing the reduction of its contribution to
greenhouse gas (GHG) emissions. According to the California Transit Association,
increasing the use of public transit would considerably lower air pollution, since public
transportation produces 95% less carbon monoxide, 90% less in volatile organic
compounds, and about half as much carbon dioxide and nitrogen oxide per passenger
mile, compared to private vehicles. According to the California Public Interest
Research Group, public transit on average gets 57 miles per gallon per passenger,
which is three times more efficient than these passengers driving their cars:"
AB 2558 will provide a means for Los Angeles County to address air pollution and
global warming caused by carbon emissions, by creating a revenue source for public
transit programs that will improve congestion and air quality.
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AB 2495 (Feuer) would state the intent of the Legislature to enact legislation to allow
the state to create public-public partnerships with local governmental agencies for fee-
producing infrastructure projects and facilities.
ACA 10 (Feuer) would lower to 55% the voter approval threshold for a city, county, or
city and county to impose, extend, or increase any special tax for the purpose of paying
the principal, interest; and redemption charges on bonded indebtedness incurred to
fund specified transportation infrastructure. This measure would also lower to 55% the
voter approval threshold for a city; county, or city and county to incur bonded
indebtedness, exceeding in one year the income and revenue provided in that year,
that is in the form of general obligation bonds to fund specified transportation
infrastructure. Council supported the measure and staff has begun advocacy.
AB 1815 (Feuer) This bill would create the California Transportation Infrastructure
Funding Task Force to evaluate alternatives to the existing system of taxing road users
through per gallon fuel taxes. It reports to the Legislature and the Governor.
Financial Impacts and Budget Actions
There is no fiscal impact from the recommendations in this report and no additional
budget authority is required to educate the public as recommended.
Prepared by:
Kathryn Vernez, Assistant to the City Manager for Community. and Government
Relations
Dean Kubani, Environmental Programs Manager
Ellen Gelbard, Assistant Director, Planning and Community Development
Approved: Forwarded to Council:
Cathryn Ve~hez °° P ont Ewell
Assistant to the City Manager for Manager
Community and Government Relations
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