January 11, 2007 - From the Dec/Jan, 2006-07 issue

MIR Readers Share Predictions for Investment of Infrastructure Bond Funds in 2007

2006 was a triumphant year for infrastructure in California, but now that measures 1A-1E have passed and represent $40 billion of leverageable investment, the hard work begins. 2007, then, will be remembered as the year when California figured out how to invest and how to identify and built projects that will improve the state efficiently. In anticipation of the flurry of prioritizing and building this year, MIR asked readers to predict the quality of investments and decisions that California's leaders will make.

"With the passage of both the state infrastructure bond package and the Governor's greenhouse gas initiative, what is needed in 2007 is a coherent public strategy that smartly leverages federal, state, and local dollars with private investment and greenhouse gas regulations to respond proactively to our fundamental geopolitical dilemma: how to grow our economies while reducing our dependence on imported energy and, over time, carbon-emitting fuels."

Robert Hertzberg

Former California Assembly Speaker

Co-Founder, Renewable Capital

"When we look back on 2007, we will have seen California take meaningful bipartisan steps to improve its infrastructure. Projects with regional and statewide benefit will have been approved by the Legislature and governor and an expanded set of financing and implementation tools provided to Caltrans and other agencies. Citizens will feel as though the bond funds are being well spent."

Richard G. Little, AICP

USC Keston Institute for Public

Finance and Infrastructure Policy

"The real challenge with the $40 billion dollars in infrastructure bonds is figuring out how to get Sacramento and the local municipalities to act NOW. This is not something we can sit on and wait for plans to be formulated. We need to move tomorrow, or we will be sitting here next year asking ourselves, ‘What happened with that bond money?' Throw caution to the wind, and go with the ‘ready, fire, aim' philosophy!"

Bruce Ackerman

Economic Alliance of the San Fernando Valley

"Voter approval of the infrastructure bonds is the opportunity of a generation. I believe allocation of bond resources must be made in a manner that offers incentives for low impact development, green building, an integrated approach to reducing stormwater pollution, reducing flood risks, and augmenting water supplies. The governor and the Legislature must have the leadership and vision to tie bond expenditures to a more sustainable California."

Mark Gold

Executive Director

Heal the Bay

"Our transportation system has suffered decades of neglect. At the beginning of 2007, $18 billion of requests were made for $4.5 billion available. When we look back on 2007, I want people to say, ‘Isn't it great that our elected officials committed to improving California's aging freeway system, that the 405, 605 and 22 freeway improvements are in the pipeline to move people and goods between L.A. and Orange County, and the 91 Freeway will soon efficiently connect Orange and Riverside counties?'"

Lucy Dunn

Orange County Business Council

"The people of California have given government a once-in-a-generation opportunity to invest heavily and wisely in the vital infrastructure needs of our state. If we invest intelligently, where the need is greatest, future generations will look back and say that 2007 was the beginning of California's turnaround in transportation, education, water, and housing."

Zev Yaroslavsky

L.A. County Supervisor

"California's infrastructure has been ignored for far too long. The bond measures are merely a start on what's needed. Mayor Villaraigosa's initiatives to restart various rapid transit routes are vital to unlock the growing transportation gridlock in Southern California.

"At LAWA we have started a number of long-ignored modernization projects, with many more on the agenda in 2007. But our goal to more substantially increase regionalization is very much dependent on massive ground transportation (including high speed rail) infrastructure projects so Ontario and Palmdale can be utilized to their full potential. In short, 2006 for California and for LAWA was a good start, but just that: a start. Much more will be needed."

Alan Rothenberg

L.A. Airport Commission President

"2007–08 will be known as the "Golden Years" in strategic investment of state bonds funds-for roads and transit, housing, schools, water facilities, parks, agricultural lands and wildlife habit-within each spending category as these investments intersect with and mutually impact each other. The state's future-not to mention future voter support for bond funds-depends on it."

Nick Bollman

Founder

California Center for Regional Leadership

"First, I think we will be able to say that we've made a good start in targeting the necessary infrastructure investments. I suspect that little of the bond money will have actually been put to work by this time next year, partly because of the public process required to structure and sell the bonds as well as because we need to plan carefully for how the money will actually be spent.

"Second, I hope we will be able to say that we have targeted the money so as to keep faith with the electorate. Even as large as the bond authority is, it represents only a down payment on the state's infrastructure needs. In order to follow through on the required investment, California will have to demonstrate that the down payment has been wisely and strategically invested."

Michael George

CEO, Western Water Co.

"The governor and legislative leadership deserve a lot of credit for getting a bond package of this size passed. $40 billion is not spare change, but clearly not enough. Unfortunately, the bond package did not provide for more design build projects and public-private partnerships, both of which would have given taxpayers more bang for more buck."

Brendan Huffman

Valley Industry & Commerce Assn.

"By the end of 2007 we will have not drawn down most of the $40-plus billion in approved bond revenues. Why? With all the regulations we have amassed over past years (CEQA, etc) start ups of almost all infrastructure projects will be delayed for years. Without Sacramento continually explaining why projects are delayed, 2007 could be the first year when voter patience begins running out."

David Fleming

Latham & Watkins

MTA Boardmember

"You can't talk about moving Los Angeles forward without talking about traffic. In the last year, we have seen the success and expansion of the Orange Line, signal synchronization in the Valley and Tiger Teams launched to relieve traffic during rush hour, among many other accomplishments. Looking to the year ahead, Los Angeles is eligible for nearly $6 billion in funds from the recently passed infrastructure bonds.

"I will be in Sacramento fighting for L.A.'s fair share, which will help with carpool lane expansion on the 405 Freeway, the extension of the Exposition Line, and moving forward with the Subway to the Sea. I believe in a different kind of Los Angeles. I imagine a Los Angeles where we coordinate our transportation planning with our land use, where we increase density along transportation corridors, and where we build up as opposed to out."

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Wendy Greuel

L.A. City Council

"We will look back on 2007 as the watershed year when Los Angeles began to capture its fair share of state infrastructure bond money. For the first time, Los Angeles had compelling proposals for projects that were ready to go, met the criteria for the various bond categories, and leveraged other local, state, and federal funds. As a result, a substantial package of very green transportation, housing, and Los Angeles River projects began to move forward, creating momentum for more visible and creative investments in years to come."

Mary D. Nichols

Director

UCLA Institute of the Environment

LADWP Boardmember

"Because of the leadership of Governor Schwarzenegger and the Legislature, Californians were offered a chance to make a major investment in their own future and they seized that opportunity by overwhelmingly approving Proposition 1B, the $20 billion transportation bond. I thank the voters for entrusting us with the responsibility to rebuild and revitalize the state's transportation system. We are now obligated to deliver."

Will Kempton

Director, Caltrans

"I fear we'll say it wasn't enough, and that Southern California didn't get its fair share. I hope we'll say that the reinvestment in infrastructure at the state level helped focus attention on the need to reinvest in the aging infrastructure of the city of Los Angeles."

Frank Cardenas Gonzalez

Attorney

"Regarding the $3 billion in bonds for goods movement and environmental mitigation, it is our hope that by the end of 2007 the CTC and CARB will have equitably allocated the bond funds and other matching funds to a statewide and regional program of projects that addresses our most vital current goods movement needs."

John Doherty

CEO

Alameda Corridor

Transportation Authority

"I am pleased that California voters approved the infrastructure bond measures on the ballot in November. This additional funding from the state will provide critical infrastructure upgrades to our aging systems. Now we must combine federal, state and local efforts to strengthen our federal investment in infrastructure improvements.

"As a newly appointed member of the Appropriations Committee, I will work to ensure that our state and region gets its fair share of our federal resources. Changing federal funding formulas is always an uphill battle, but with additional California representation on the Appropriations panel and the House Speaker from our home state, we have a solid opportunity to complement California's bond funding with a strong federal investment."

Adam Schiff

Member, U.S. House of Representatives

"In the future, Californians will look back and say, ‘they finally made a down payment on needed investments that had been delayed for years.' These investments get us headed back on the right track, helping us meet our obligations to future Californians. But it is only a down payment."

Elizabeth Warren

FuturePorts

"In the transportation area, the California Transportation Commission heard the voters' concerns for real congestion relief loud and clear. The Commission's Corridor Mobility Improvement Account (CMIA) investments reflect a coordinated and strategic effort to achieve sustainable mobility benefits in the near term and set the table for future investments."

John Barna

California Transportation Commission

"I believe future historians will look at the commitment made by California in 2006 to reinvest in its aging infrastructure and will say that finally Californians stopped pretending we could live off the investments made by past generations and we had to start paying our own way. They will point to the November 2006 election as the turning point where California began to return to its rightful place as one of the best areas in the world to live, work, recreate, and raise families."

Jeffrey Kightlinger

General Manager

Metropolitan Water District of Southern California

"This year I think we will realize, or at least start to realize, that our infrastructure problems are so painful that we will have to find a new way to deal with future population growth and the huge increase in demand for moving people and goods. What I see in real time is that the huge annual increases in population is eating up literally every dollar we invest in solving old congestion problems.

"It's pretty simple stuff. Future growth is creating transportation congestion problems at a much faster rate than we are able to deliver transportation solutions. We must mitigate future growth with a different pot of money as we fix the old congestion problems with the existing ‘black holes process.

"Think about how many more cars will be driving on the 405 Freeway by the time we actually deliver that project, which is totally funded and approved for design-build, but won't be completed until 2015 or later. The congestion projects we currently fund may be a good success story in some brochure, but the system remains broken and is infuriating all of us. We have to find a way to deliver congestion solutions faster than we create congestion problems. Just do the math."

Wally Baker

LAEDC

"Because the Legislature failed to attach sufficient ‘strings' or incentives to the bond monies, local and state agencies continued to mostly invest in unsustainable patterns of growth."

Dan Silver

Endangered Habitats League

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