MEMORANDUM To: Randy Iwasaki, Executive Director - Contra Costa Transportation Authority From: Brian Sowa, Keystone Public Affairs Subject: June Updat

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1 Administration and Projects Committee STAFF REPORT Meeting Date: June 2, 2016 Subject Summary of Issues Recommendations Legislative Update This is an update on relevant developments in policy, legislation and finance that are of interest to the Authority. Mark Watts of Smith, Watts & Hartmann, LLC will discuss current State legislation. Discussion and action to be determined on proposed legislation on an individual basis. Financial Implications Options Attachments A. Federal Legislative Update B. State Legislative Update Changes from Committee Background This report contains updates on relevant developments in policy, legislation and finance that are of interest to the Authority both at the State and Federal levels of government. Mark Watts of Smith, Watts & Hartmann, LLC will be in attendance to discuss current legislative activities that may affect the Authority. This discussion may consist of an overview of current bills, and may also include recommendations for positions/actions by the Authority pertaining to specific bills. 13-1

2 MEMORANDUM To: Randy Iwasaki, Executive Director - Contra Costa Transportation Authority From: Brian Sowa, Keystone Public Affairs Subject: June Update Date: May 18, 2016 Washington Update The House appropriations committee released its FY17 Transportation appropriations measure this week. The bill includes $19.2 billion in discretionary appropriations for the Department of Transportation for fiscal year This is $540 million above the fiscal year 2016 enacted level and $4.0 billion below the President s request. In total budgetary resources, the bill provides $76.9 billion to improve and maintain the nation s transportation infrastructure. The bill targets funding to programs and projects that will increase efficiency, safety, reliability, and quality of life for the traveling public, and that will help improve commerce and economic growth. Highways The bill allows $44 billion from the Highway Trust Fund to be spent on the Federal-aid Highways Program, which is $905 million above the fiscal year 2016 level. This funding mirrors the levels authorized in the Fixing America s Surface Transportation Act (FAST Act), which was approved last year, and will provide much needed growth and improvements within America s highway system. Rail The Federal Railroad Administration is funded at $1.7 billion, an increase of $42 million over the fiscal year 2016 enacted level and $4.5 billion below the request. The bill adopts the new Amtrak funding structure as authorized, providing $420 million for Amtrak s Northeast Corridor and $1 billion to support the national network. The bill also continues reforms to ensure the best use of tax dollars, such as requiring overtime limits for Amtrak employees to reduce unnecessary costs, and prohibiting funds from being used to subsidize losses associated with Amtrak s food and beverage service. Rail safety and research programs are funded at $300 million, $12 million above the fiscal year 2016 enacted level. This will fund inspectors and training, plus maintenance and safety investments to the physical rail infrastructure, to help ensure the safety of passengers and local communities. 13-2

3 Transit The bill provides $12.5 billion in total budgetary resources for the Federal Transit Administration (FTA) $743 million above the fiscal year 2016 enacted level and $7.4 billion below the request. Transit formula grants total $9.7 billion consistent with the authorization level to help local communities build, maintain, and ensure the safety of their mass transit systems. Within this amount, $2.5 billion is included for Capital Investment Grants ( New Starts ), full funding ($1.2 billion) is included for all current Full Funding Grant Agreement (FFGA) transit projects, and an additional $500 million is included for FFGAs that will come online over the new year. Core capacity projects receive $332 million in the bill an increase of $282 million and $408 million is included to fund all state and local Small Starts projects that will begin in fiscal year These programs provide competitive grant funding for major transit capital investments including rapid rail, light rail, bus rapid transit, and commuter rail that are planned and operated by local communities. Safety The legislation contains funding for the various transportation safety programs and agencies within the Department of Transportation. This includes $918 million in total budgetary resources for the National Highway Traffic Safety Administration (NHTSA) an increase of $49 million over the fiscal year 2016 enacted level and $644 million for the Federal Motor Carrier Safety Administration. Also included is $228 million for the Pipeline and Hazardous Materials Safety Administration, an increase of $4.8 million over the fiscal year 2016 enacted level, to help address safety concerns including the transport of energy products. Grants The legislation funds National Infrastructure Investment grants (also known as TIGER grants) at $450 million, $50 million below the fiscal year 2016 enacted level and $800 million below the request. These grants are awarded by the Department of Transportation to states and local communities for infrastructure construction and improvements. In the Senate, Majority Leader McConnell stated that he hopes to have their version of the Transportation appropriations bill passed on the floor by May 20 th. The FAA Reauthorization bill continues to be held up in the House over opposition to privatizing the Air Traffic Control system. The current extension expires on July 15 th. We do 13-3

4 not anticipate the House being able to move on a comprehensive bill before adjourning for the 2016 election season Washington DC Meetings CCTA Board Chair Dave Hudson, Commissioner Julie Pierce, and staff members Randy Iwasaki, Ross Chittenden and Linsey Willis were in Washington DC for meetings on May 16-17, 2017 with the United States Department of Transportation and Contra Costa delegation. Meeting topics included an update on GoMentum Station including planned activities for the upcoming year, CCTA s concern with the FAA rule affecting local sales taxes, and current and upcoming grant opportunities such as the advanced transportation and congestion management technologies deployment grant, opportunities with the Department of Energy and TIGER funding. 13-4

5 Smith, Watts &Hartmann, LLC. Consulting and Governmental Relations MEMORANDUM TO: FROM: Linsey Willis Mark Watts DATE: May 16, 2016 SUBJECT: June APC Report Key Bills Update Presented below are brief summaries of bills of interest to the authority, including AB 1592 (Bonilla), AB 1665 (Bonilla) and AB 1764 (Stone). A brief summary of the May 13 Governor s May Revision to the state budget is included, as well. AB 1592 (Bonilla) This measure authorizes the Contra Costa Transportation Authority to conduct a pilot project for the testing of autonomous vehicles. The bill was approved by the full Assembly on April 6 (75 0) and has been assigned to the Senate Transportation & Housing committee. Discussions with the Committee staff indicate that they have three hearings dates in June (14 th, 21 st, and 28 th ) and are leaning towards setting the bill for hearing on the 14th. Additionally, there are two other bills that address autonomous vehicles and we will need to be mindful of the possible need to reconcile AB 1592 with these as the session recess nears this summer: AB 2866 (Gatto): Requires the Department of Motor Vehicles (DMV) to adopt regulations for the testing and operation of autonomous vehicles without a driver in the vehicle and without a brake pedal, accelerator pedal, or steering wheel. The bill is pending hearing in the Assembly Appropriations committee. AB 2682 (Chiu): This bill requires DMV, upon the development of a model state policy on autonomous vehicles by the National Highway Traffic Safety Administration (NHTSA), to hold public hearings on the model policy and, to the extent authorized by other law, consider conforming DMV regulations with the model policy. Discussions with the author s office indicate they may be amending the bill soon. It is pending hearing in the Senate Transportation & Housing Committee. 925 L Street, Suite 220 Sacramento, CA Telephone: (916) Fax: (916)

6 AB 1665 (Bonilla) This bill authorizes the taxing authority for a countywide transportation program to be transferred from the County of Contra Costa to the Contra Costa Transportation Authority. After discussions with Assembly Republican Caucus staff and bill opponents, Howard Jarvis Taxpayers Association, amendments were agreed upon, and the bill was amended on May 9. These included the necessary urgency clause; close coordination between the author s office and others in the following week focused on contacting all Assembly member offices to determine the level of support for the amended bill. Finding strong support, the bill was taken up on the Assembly floor on May 16 th, and was approved by a final vote tally of 77 0, eclipsing he 54 votes required for the urgency clause. The bill is pending assignment in the Senate Rules committee. AB 1746 (Stone) This bill extends the present limited authority for a pilot program to operate transit buses on highway shoulders to additional transit operators. The bill now would provide this authorization to Livermore Amador Valley Transit Authority (LAVTA), as well as other agencies, including the Central Contra costa Transit Authority (CCCTA). On April 14, the bill was approved by the Assembly (76 0) and has been referred to the Transportation & Housing committee in the Senate. State Budget Update On May 13th, the Governor presented his regular, annual adjustments to the State Budget Proposal, known as the May Revision. The following are some highlights: Overview The Governor proposed a $122.2 billion spending plan for California, down slightly from the January State budget proposal after projecting tax revenues falling about $1.9 billion below expectations for the year and a deficit when voter approved sales and income taxes begin to expire. In addition, Proposition 2's Rainy Day fund required contributions have been reduced by a combined $1.6 billion. The Governor emphasized that until the voters decide in November whether temporary taxes should be extended, the May Revision reflects the principle that no significant new ongoing spending commitments should be made. Barring any significant changes, the Budget over the next two years remains in balance. However, in the years that follow, the state's commitments will exceed expected revenues with annual shortfalls forecasted to exceed $4 billion by 2019 or worse with an economic slowdown or recession

7 Transportation Infrastructure Governor s Transportation Plan: The May Revision continues to reflect the Governor's transportation financing package that would provide $36 billion over the next decade to improve the maintenance of highways and roads, expand public transit and improve critical trade routes. The Budget Subcommittees are scheduled to consider this issue in the coming week. Federal Freight Funding: The May Revision also reflects the availability of federal funds resulting from the Federal FAST Act that would provide additional funding for trade corridor improvements over the next five years: The FAST Act allocates $582 million over the next five years to California through the new National Highway Freight Program funding formula. Additionally, California is eligible to receive a portion of $900 million annually for Fostering Advancements in Shipping and Transportation of the Long term Achievement of National Efficiencies (FASTLANE) competitive grants. FASTLANE grants can be applied to up to 60 percent of Nationally Significant Freight and Highway Projects program costs, with the remaining funds from state, local, or other federal funding sources. The May Revision includes provisional language that makes other state and federal funding available as a match for the remaining 40 percent. Caltrans budget proposes expending the formula funding pursuant to the Trade Corridor Improvement Fund Guidelines. The California Transportation Commission would then allocate half of the funding to corridor based projects proposed by local agencies and half to projects of statewide significance proposed by Caltrans. These items are set to be considered by the Budget Subcommittees in the coming week. Other new items proposed in the May Revision, include: District 7 Express Lane Maintenance to assist LA Metro in maintaining the 10 and 110 express Lanes; Federal Bridge Load Rating Additional resources to complete this mandated assessment; Project Delivery Workload Proposes a reduction of 94 py s in line with underlying workload need, but offset by an increase of 877 py s for work related to the new funding package. Reappropriation of Bond Funds A technical correction to ensure availability of funds for PTC work in Southern California. Cap and Trade Budget The Budget provides a $3.1 billion Cap and Trade expenditure plan to address reduction of greenhouse gas emissions through programs that support clean transportation, promote transformational sustainable communities, reduce short lived climate pollutants, and protect natural ecosystems. As a reminder, the Budget continuously appropriates 35% of all cap and trade funds for investments in transit, affordable housing, and sustainable communities. Another twenty five percent of the revenues are continuously appropriated to continue the construction of high speed rail

8 The remaining 40% in cap and trade funds are to be appropriated annually by the Legislature for investments in programs that include low carbon transportation, energy efficiency and renewable energy, and natural resources and waste diversion. An expenditure plan for the 40% was not included in the Final Budget Act, with the exception of $227 million appropriated to continue funding for specified existing programs. The remaining revenues, along with revenues, totaling $3.1 billion are available for appropriation this year

Following are overviews of the budget requests for various federal departments and agencies.

Following are overviews of the budget requests for various federal departments and agencies. February 2012 President Obama Releases FY 2013 Budget Proposal President Obama February 13 released a $3.8 trillion Fiscal Year (FY) 2013 federal budget proposal which includes $1 trillion of cuts in discretionary