Transportation Committee Meeting

Transcription

1 Transportation Committee Meeting Chair: Francine Oschin (Oschin Partners) Vice Chairs: Mark Hardyment (Bob Hope Airport) Jaime Rojas (Rojas Communications) TUESDAY, MAY 13, :00 10:00 a.m. PLEASE BE PROMPT 4222 Vineland Avenue, North Hollywood, CA Welcome & Self Introductions 2. VICA Announcements & Updates 3. Updates from Elected Officials Staffers Breakfast Courtesy of The Garland AGENDA 4. California High Speed Rail Finance Plan presentation by Michelle Boehm, Southern California Regional Director, California High Speed Rail Authority 5. Save Our Streets L.A. (Englander / Buscaino) presentation by Los Angeles Councilmember Mitchell Englander and Dennis Gleason, Policy Director, Office of Los Angeles Councilmember Joe Buscaino, discussion and action item 6. SB 1077 (DeSaulnier) Mileage-Based Fee in lieu of Fuel Excise Tax discussion and action item 7. SB 1037 (Hernandez) Measure R Project Update discussion and action item 8. VICA Comment Letter on City of Los Angeles Mobility Plan 2035 presentation by VICA staff and discussion 9. New/Old Business 10. Upcoming 2014 Transportation Committee Meetings: Jul 8, Sept 9, Nov 11 Conflict of Interest Policy: You must disclose a conflict of interest prior to speaking on an issue. This requirement does not prevent you from voting on the item.

2 Save Our Streets Los Angeles Originating Committee: Transportation Date: May 13, 2014 Position: The Valley Industry and Commerce Association (VICA) supports/opposes placing the Save Our Streets Los Angeles measure on the November 2014 ballot. Background: The City of Los Angeles has the largest municipal street system in the nation with over 28,000 lane miles of residential and arterial streets. The city gives one of five letter grades (A - F) to streets depending upon their condition. Due to the city s limited resources, only streets in A, B and C condition are regularly maintained by slurry sealing using emulsified asphalt, at a cost of approximately $25,000 per mile. Approximately 8,200 lane miles are currently in D or F condition more than 35 percent of the system. These roads require total resurfacing (D) or complete reconstruction (F), costing between $250,000 and $2.5 million per mile up to 10 times the cost of regular maintenance. Over the next 15 years, an additional 500 lane miles of C-grade roadways are expected to deteriorate beyond repair. Los Angeles City Councilmembers Mitchell Englander and Joe Buscaino are proposing the Save Our Streets Los Angeles ballot measure, a $4.5 billion bond program to repair these failed streets as well as the city s sidewalks over 15 years. The bonding break-down is $3.86 billion for roadway repair and $640 million for sidewalks. The roadway portion is an estimate by independent civil engineering design Harris & Associates. The sidewalk cost is derived from the Bureau of Street Services estimate that 40 percent of the sidewalks are in need of repair. These bonds would be leveraged against a 20-year, half-cent sales tax increase in the city for 20 years. The estimated cost per taxpayer is $31.50 per year. The sales tax increase was chosen as the revenue source after analyzing several potential existing revenue sources (Measure R, Propositions A and C) and potential taxation sources (general obligation bonds, parcel taxes, documentary transfer tax, parking occupancy tax, vehicle license fee, gas tax, commercial wastehauler franchise fees). As a tax increase, the program is subject to voter approval by two-thirds. The Los Angeles City Council must vote on whether to place the measure on the November 2014 ballot by July 16, Business Nexus: Roadway repair will result in short-term cost increases for businesses, while saving money on proprietary vehicles and employee costs in the long term. The poor condition of city streets is estimated to cost drivers an average of $832 annually for vehicle repair and maintenance, increased fuel consumption and tire wear. Aside from the issue itself, a sales tax increase could discourage investment in the city, resulting in a poor business climate and reduced quality of life. Impacted Entities: Drivers, city employees, businesses within the City of Los Angeles and engaging in commerce with these businesses, investors, customers Valley Industry & Commerce Association 5121 Van Nuys Boulevard, Ste. 208, Sherman Oaks, CA phone: fax:

3 Discussion: Support Argument: The SOSLA Program will restore the overall street system to a level that provides greater public safety, supports economic development and substantially eliminates the city s deferred maintenance liability. By utilizing the sales tax, the program will ensure that costs are distributed across all users. In fact, sales tax revenues are derived primarily from tourists, commuters and other visitors, with residents only paying an estimated 42 percent of the cost. Failure to address this issue now will result in exponential cost increases down the line, resulting in a greater burden on future taxpayers. Opposition Argument: Street maintenance is a core municipal function and should be funded out of the General Fund and other existing revenue sources. Residents and businesses already pay ridiculously high sales tax rates, a good share of which is directed locally toward transportation, including Measure R and Proposition A and C funds. We should not allow the city to increase this burden even more, further worsening the competitiveness for city businesses to their counterparts in Burbank, Glendale and Pasadena. Our streets are undoubtedly in need of repair, but the city should find funding methods that do not increase the cost of living and doing business in the city. Supporters: No formal support, as of 5/6/14 Opponents: No formal opposition, as of 5/6/14 Process History: Brought to the Transportation Committee on May 13, 2014: Pass Fail Tabled Amended Brought to the Board of Directors on May 22, 2014: Pass Fail Tabled Amended Valley Industry & Commerce Association 5121 Van Nuys Boulevard, Ste. 208, Sherman Oaks, CA phone: fax:

4 SB 1077 Mileage-Based Fee Originating Committee: Transportation Date: May 13, 2014 Position: The Valley Industry and Commerce Association (VICA) supports/opposes Senate Bill 1077 (DeSaulnier) which creates a pilot program to assess the institution of a mileage-based fee as an alternative to the state base fuel excise tax. Background: Funding for the state highway system is derived from a base gasoline excise tax at a rate of 18 cents per gallon (cpg). 1 Since 2000, fuel tax revenues have declined significantly as a result of reduced reliance on personal vehicles and increasing fuel efficiency. Meanwhile, transportation project costs are increasing due to population growth and inflation. A mileage-based fee (MBF) is a user charge based on miles driven in a specific vehicle. At its simplest, the fee would charge drivers a certain amount per mile, with the potential for rates to be adjusted by location, congestion, emissions and type of vehicle. Senate Bill 1077 would direct the state transportation agency to develop a pilot program by Jan. 1, 2016 to explore the implementation of a MBF and the elimination of the base gasoline excise tax. Specifically, the agency would evaluate: Methods for calculating mileage and collecting road usage with the minimum amount of personal information necessary Processes for managing, storing, transmitting, and destroying data Types of equipment that may be required for the state and drivers Estimated costs of implementation and operation of the system Security measures to minimize fraud and tax evasion Which government entities could appropriately collect data and handle revenue collection The frequency at which charges should be billed or collected The agency would be required to consult with Caltrans, the Institute of Transportation Studies at the University of California, or other entities with expertise in automotive technology, revenue collection, and privacy. The agency would be required to issue its recommendations by June 30, Oregon conducted a MPF pilot program from Nov through Jan and is currently instituting a voluntary program beginning in July 2015 at a MBF rate of 1.5 cents per mile. 1 The state also charges additional fees on gasoline determined each year by the Board of Equalization to fund local streets and new capacity projects; the current rate is 34.9 cpg. The total current state taxes and fees on gasoline is 52.9 cpg.

5 Impacted Entities: Drivers, trucking companies, local governments, transportation agencies Business Nexus: The institution of a mileage-based fee has the potential to collect significantly more revenue from drivers, increasing the direct costs for doing business while decreasing indirect costs associated with vehicle damage due to poor roadway condition. The fee could also result in an increase in mass transit funding, positively resulting in congestion relief or negatively causing reduced roadway capacity for personal and commercial vehicles. Discussion: Support Argument: Fuel excise taxes are an unsustainable revenue source that will continue to diminish with technological advancements. The current unfair taxation structure requires gasolinebased vehicles particularly older, heavier and less fuel-efficient vehicles to subsidize the roadway impact of high efficiency and alternative fuel vehicles. A MBF will more appropriately charge vehicles for their roadway use and will generate the necessary funding for transportation system maintenance and improvement. As a result, our roadways will be better maintained, thereby decreasing the cost of vehicle maintenance, preventing accidents, and reducing congestion that results from driver behavior to avoid roadway hazards. SB 1077 is a first step to instituting this forward-thinking system that will adapt to California s environmental and transportation needs. Opposition Argument: A MBF system will require a massive bureaucracy, at a cost of up to five times the administrative cost of collecting the excise tax. Furthermore, the system allows for a gross invasion of privacy, as the state government will have unprecedented access to driver location and behavior. While additional revenue for transportation may seem attractive, the goods movement industry will pay the lion s share of these increased fees, thereby increasing the cost of goods and potentially impacting employment in this key state industry. The insufficient investment in our roadways is not an issue of insufficient revenue, but rather fiscal mismanagement. Transportation agencies should focus on reducing overhead costs and cost overruns. SB 1077 is a slippery slope that endangers driver privacy, increases state costs and interferes with the free market. Committee Discussion: Pending discussion in Transportation Committee Supporters: Transportation California, American Council of Engineering Companies of California, American Planning Association, California Asphalt Pavement Association Opponents: No official opposition, as of 5/6/14 Process History: Brought to the Transportation Committee on May 13, 2014: Pass Fail Tabled Amended Brought to the Board of Directors on May 22, 2014: Pass Fail Tabled Amended

6 SB 1037 Measure R Funding Estimates Originating Committee: Transportation Date: May 13, 2014 Position: The Valley Industry and Commerce Association (VICA) supports/opposes SB 1037 (Hernandez), which requires the Los Angeles County Metropolitan Transportation Authority (MTA) to update its expenditure plan for Measure R projects before presenting another ballot measure before the voters. Background: In 2008, MTA proposed a countywide half-cent sales tax increase to generate an estimated $40 billion for roadway and transit projects over 30 years. Before submitting it to voters, MTA created an expenditure plan including three projects in the San Fernando Valley: the Metro Orange Line to Chatsworth; the East San Fernando Valley Transit Corridor; and the Sepulveda Pass Transit Corridor. The proposal, Measure R, was approved by a 2-to-1 margin on the November 2008 ballot. Due to the recession that followed, MTA adjusted its revenue estimates downward to $36 billion. To address this funding shortfall, MTA is searching for alternative sources to fully fund Measure R projects. AB 1446 (Feuer) was passed in 2012, authorizing MTA to place before the voters a new ordinance to extend Measure R's 30-year sunset date. Measure J failed to achieve the two-thirds majority necessary for passage on the November 2012 ballot. SB 1037 requires MTA before submitting another ballot measure to present an updated expenditure plan and timeline for each remaining project, as well as any projects adopted by each sub-region for inclusion in the next measure. Of particular importance, the bill requires MTA to specify the sources or potential sources of non-measure R funds to ensure full funding of planned projects. These revised figures would need to be incorporated into MTA s Long-Range Transportation Plan (LRTP). VICA supported Measure R and has been involved in the implementation of related Valley area projects. VICA also supported Assembly Bill 1446 (Feuer) and Measure J. Entities Impacted: MTA, taxpayers, commuters Business Nexus: MTA generates Measure R tax revenue from businesses. Funded projects have the potential to impact direct and indirect costs related to congestion. Discussion: Support Argument: Plans for upcoming Measure R projects have estimated costs that far exceed the numbers presented to voters in Measure R. As a result, voters are concerned about the capacity for MTA to fund second and third decade projects. SB 1037 will ensure transparency by requiring MTA to provide comprehensive information on how much these projects will cost; where Measure R dollars will be spent; what funding needs exist; and what sources can be tapped to meet those needs. By ensuring the most up-to-date information is provided to voters, they can make an informed decision about supporting future tax measures. Opposition Argument: Measure R has ushered a golden age of transportation construction with increasing demands for revenues. This bill will tie MTA s hands in adapting to the evolving transportation priorities and economic environment of the county. Of particular concern, MTA staff will be forced to theorize potential revenue sources for a plan that spans 30 years and to incorporate them into its LRTP. These unreasonable parameters will open MTA to unnecessary criticism and potential liability.

7 Committee Discussion: Pending discussion in Transportation Committee Supporters: No official support, as of 5/6/13 Opponents: No official opposition, as of 5/6/13 Process History: Brought to the Transportation Committee on May 13, 2014 Pass Fail Tabled Amended Brought to the Board of Directors on May 22, 2014 Pass Fail Tabled Amended

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