March 10, 2008

California Transportation Commission Moves Forward on State's Mobility Despite Budget Woes

With the California State budget held up in the Senate and with a huge axe hanging over the transportation funding that seemed so promising last November, California's mobility challenges aren't getting any less intractable. In order to catch up on the process of the California Transportation Commission as it pushes forward with allocations from Prop 1B, MIR was pleased to speak with John Barna, executive director of the CTC, who had plenty of details to offer regarding the state's efforts to improve mobility, and even offered a surprising viewpoint on the state budget's proposed cuts to transportation funding.


John Barna

This article was featured in the MIR insert included in the July issue of The Planning Report.

MIR interviewed you in March of this year, immediately after the Transportation Commission released a revised list of recommended projects for funding under Prop 1B. What is the status of those allocations, and what funding decisions does the commission face next?

The commission has programmed $4.4 billion for 54 projects from the Corridor Mobility Improvement Account (CMIA), and has signed contracts for delivery on all of the projects. The delivery contracts provide baselines for scope, schedule, and cost, which the commission will use to monitor project progress and reporting to the Legislature and the administration. We should start seeing the first of those projects come in for construction allocations in the 2007-08 fiscal year. I think there will probably be five or six projects requesting construction allocations in 2007-08, and the remainder will come in the 2009-10 and 2010-11 fiscal years. We have also programmed the billion dollars for the State Route 99 Corridor program, and anticipate that most of the projects will come in for construction allocations in the 2010-11 fiscal year.

We are in the midst of working with stakeholders and the Legislature on implementation of the Trade Corridor Improvement Fund (TCIF), which is the goods movement portion of Proposition 1B. We are currently working with Caltrans on guidelines for the Traffic Light Synchronization Program. We are awaiting action from the Legislature-probably through 2007-08 budget trailer bill language-on how to approach the remaining Proposition 1B pieces, including the State-Local Partnership Program. In all likelihood, the commission will not have much of a role in the transit or the city and county piece, other than having some responsibility in regard to reporting requirements.

We will report on the progress of the Proposition 1B programs in our annual report to the Legislature.

The commission funded 54 projects in the first round. What, against a total of the $20 billion in bonds, was approved?

For the 2006-07 fiscal year, the Commission programmed approximately $7.9 billion of Proposition 1B funds: $4.4 billion CMIA, $1 billion Route 99 Corridor, and the $2 billion State Transportation Improvement Program (STIP) Augmentation.

In fiscal year 2007-08, we anticipate four to six programming events, some of which are through the normal STIP and SHOPP programming processes occurring in spring of 2008, and the others through Proposition 1B. We are looking at programming $2-3 billion in Proposition 1B funding. We will develop guidelines for the Trade Corridor Improvement Fund and would like to program projects next spring in time for allocation in the 2008-09 fiscal year. ($2 billion is provided for in this fund.) We are also hoping that we will have a round of programming for the State-Local Partnership Program ($1 billion), $500 million for the State Highway Operation and Protection Program (SHOPP) augmentation, the Highway-Railroad Crossing Safety Account ($250 million), as well as the Traffic Light Synchronization program ($250 million).

The proponents of measures 1A and 1B, when the campaign was going on, continuously said, "We've got to ensure that these transportation funds go for transportation and that these bonds are a down payment on what we really need."

Given that the budget in Sacramento is still in play, one of the priorities in play is transportation funding, and the demand for transportation dollars far exceeds the supply. Describe the politics around transit funding. How might siphoning funds off for other priorities affect public rust regarding future bonding for infrastructure?

The budget for 2007-08, and likely the 2008-09 budget, will be tough budgets for the state. There is an existing structural deficit, and transportation dollars have been tapped in the 2007-08 year and likely will be in 2008-09 as well. The sales tax on gasoline and its complicated calculation formula, with gas prices as high they are, has been throwing off the revenue that can be diverted. It is not an ideal situation from a transportation standpoint, but from the broader vantage point of good public policy, it could be one of the best strategies available to help the general fund deficit. It is just one of the practicalities of budget politics in Sacramento. Having said that, I think that there is a growing understanding in Sacramento, both from the Legislature and the Administration, that tapping transportation dollars to fit annual budget challenges ultimately has adverse impacts on the completion of projects.

We are starting to see solutions emerge, especially with the 2007-08 budget, that tap transportation to help fill the budget gap, but in a manner that minimizes impact on project delivery. We would like to have the dollars stay within transportation. Absent that, we are trying to assure that when dollars are tapped, they come back with minimal impact on project delivery.

In its recent STIP augmentation, the CTC warned that there will be an increasing shortage of federal funding for transportation. What must be done at the state level and by the California delegation to secure more federal funds for the projects that are needed in California and Southern California?

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The delegation needs to remain unified. The challenge in Washington is that the Federal Highway Trust Fund is not going to be able to meet all of its obligations at the end of the decade. When that occurs, it is going to put extreme pressure on the big donor states to get any serious federal return.

In order to pay for the clean up after Katrina and other things, the obligation authority-the amount that is allowed to be spent on transportation-has been going down. The return is now less than 90 cents on the dollar. We have been able to deal with that, but if that becomes a permanent situation, it is going to put pressure on California to rearrange funding.

When the Federal Revenue Commission was in Los Angeles in February, we pointed out that with Proposition 1B, California has become a self-help state. As a result, we are not relying on federal funds for transportation the way other states rely on federal funds. We do not want to lose $1 billion; we need those dollars desperately. But we are less and less reliant on federal funding, in part because we have massive transportation needs, and we have to try to find the resources on our own. As a result, federal dollars are going to be viewed not as the first dollar, but probably the last dollar, in funding any project.

For Southern California, federal funds are critical to major transit projects in particular. Federal funding is less critical on the highway side, but very important to cities and counties in Southern California, in terms of keeping many smaller projects going. We have to realize that we are going to have an entirely different set of dynamics at the end of the decade, and not relying on the federal government may be one of our key survival skills.

The governor just appointed Mary Nichols to chair CARB. CARB recently warned that stalled environmental regulations are placing $1.2 billion of federal funding for transit projects at risk. Given the Schwarzenegger administration's public campaigns in support of our infrastructure bonds and for climate change policies, why isn't there a stronger focus on transportation as a possible solution to climate change? Have the environmental priorities of the current administration increased support for transportation funding?

We have not yet seen an impact on transportation funding, per se, relative to the Administration's emissions reduction and air quality policies. We are beginning to work in conjunction with CARB and the transportation, environmental, and environmental justice community stakeholders, to incorporate AB 32 greenhouse gas reduction targets and strategies into transportation planning and programming in the future.

Senate President Pro Tem Don Perata asked the commission to initiate a stakeholder-driven process to look at updating our Regional Transportation Plan (RTP) guidelines to incorporate AB 32 as well as smart growth principles. We held our kick-off meeting on June 28 in Sacramento. We will be working with a variety of stakeholders on a monthly basis through the summer and the fall, and will forward recommendations to Senator Perata by the end of the year.

Moving forward, coming out of that effort, as well as from legislative attempts such as SB 375 by Senator Darrell Steinberg-which would direct the Commission to update their RTP guidelines-transportation planning and programming is going to get a lot greener. From a strategic standpoint, transportation is going to need to demonstrate that it's playing its part in reducing emissions. Whereas at the federal level, it's been an issue of conformity, and modeling has driven that. I think we are going to have to go beyond modeling to actually demonstrating tangible results with new project ideas and new strategies. That is a positive, because it means that we have looked at demand management; we're going to have to look at some operational improvements that can deliver those benefits in the near term. Transportation has not done a good job of looking at demand management strategies and operational projects, we have been focused primarily on concrete, steel, and asphalt. There is a fair amount we can do to deliver some benefits just by enhancing the management of the system.

As for being at risk for federal funding relative to meeting conformity at the federal level, that's going to be a tough negotiation between California and the federal EPA on the PM 2.5 standards. We understand the challenge that the Southern California Association of Governments and the South Coast Air Quality Management District are having in trying to come up with an RTP that leaps that new standard forward. We are hopeful that Mary Nichols can help, through her leadership, get past the immediate challenges that the region faces. As Southern California goes, relative to this issue, the entire state's going to go down the same road.

Controversy has emerged surrounding the use of eminent domain necessary to complete the 405 HOV lanes that were funded in the revised round of the Prop 1B funding. How is the CTC evaluating controversial land use projects, especially considering the eminent domain reforms that are currently in the Legislature and the trouble that everyone went through to even get the 405 project into the Corridor Mobility Improvement Account?

We are aware of some of the challenges that are emerging with the project. We have a project delivery contract with Caltrans and Metro for this project and we are optimistic that Caltrans and the Metro are going to deal with the issues in a timely manner so that the project can get built. The commission remains committed to the project. It was a project we always knew was important and we found a way to include it in the Corridor Mobility Improvement Account. I think that it is a little early yet to be overly concerned about the project. We will continue to monitor the project's progress, and rely on Caltrans and Metro to fulfill their end of the project delivery contract.

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