AB 2094: Transportation: Greenhouse Gas Reduction Fund: state and local transportation funds.
- Session Year: 2015-2016
- House: Assembly
- Latest Version Date: 2016-03-18
The California Global Warming Solutions Act of 2006 designates the State Air Resources Board as the state agency charged with monitoring and regulating sources of emissions of greenhouse gases. The act authorizes the state board to include the use of market-based compliance mechanisms. Existing law requires all moneys, except for fines and penalties, collected by the state board as part of a market-based compliance mechanism to be deposited in the Greenhouse Gas Reduction Fund and to be available, upon appropriation, for purposes relating to greenhouse gas emissions reduction.
Existing law provides for deposit of revenues from sales and use taxes in the Retail Sales Tax Fund, including revenues from sales and use taxes imposed by local agencies under the Bradley-Burns Uniform Local Sales and Use Tax Law. Existing law provides for revenues from 1/4 of 1% of the sales and use tax rate imposed by counties under the Bradley-Burns Uniform Local Sales and Use Tax Law to be transferred from the Retail Sales Tax Fund to local transportation funds created in each county for allocation by transportation planning agencies to various transportation purposes under the Transportation Development Act. The California Constitution imposes certain restrictions on the Legislature relative to the provisions governing the Bradley-Burns Uniform Local Sales and Use Tax Law and local transportation funds.
This bill, beginning in the 201617 fiscal year, would transfer $1 billion annually from the Greenhouse Gas Reduction Fund to the Retail Sales Tax Fund, subject to specified conditions, and would state that the transferred revenues shall be considered part of the revenues allocated to local transportation funds from the Retail Sales Tax Fund. The bill, in each fiscal year in which that transfer occurs, would also continuously appropriate $1 billion from the Retail Sales Tax Fund for allocation to state highway and local street and road purposes. The bill would make legislative findings and declarations in that regard.
The Use Fuel Tax Law imposes a state excise tax on the use of fuel at specified rates. That law defines the term motor vehicle for purposes of that law.
This bill would make nonsubstantive changes to that definition.
The Use Fuel Tax Law imposes a state excise tax on the use of fuel at specified rates. That law defines the term motor vehicle for purposes of that law.
This bill would make nonsubstantive changes to that definition.
The Legislature finds and declares that this act complies with Section 2 of Article XIXA of the California Constitution, and that:
(a)Subdivision (e) of Section 2 of Article XIXA of the California Constitution prohibits loans from the Retail Sales Tax Fund, but does not prohibit transfers or diversions from the Retail Sales Tax Fund.
(b)Pursuant to subdivision (f) of Section 2 of Article XIX A of the California Constitution, the percentage of the sales and use tax imposed pursuant to Section 7202 of the Revenue and Taxation Code allocated to local transportation funds pursuant to this act remains identical to the percentage that was transmitted to those funds during the 2008 calendar year.
SEC. 2.Section 39719 of the Health and Safety Code is amended to read:39719.(a)The Legislature shall appropriate the annual proceeds of the fund for the purpose of reducing greenhouse gas emissions in this state in accordance with the requirements of Section 39712.
(b)To carry out a portion of the requirements of subdivision (a), annual proceeds are continuously appropriated for the following:
(1)Beginning in the 201516 fiscal year, and notwithstanding Section 13340 of the Government Code, 35 percent of annual proceeds are continuously appropriated, without regard to fiscal years, for transit, affordable housing, and sustainable communities programs as following:
(A)Ten percent of the annual proceeds of the fund is hereby continuously appropriated to the Transportation Agency for the Transit and Intercity Rail Capital Program created by Part 2 (commencing with Section 75220) of Division 44 of the Public Resources Code.
(B)Five percent of the annual proceeds of the fund is hereby continuously appropriated to the Low Carbon Transit Operations Program created by Part 3 (commencing with Section 75230) of Division 44 of the Public Resources Code. Funds shall be allocated by the Controller, according to requirements of the program, and pursuant to the distribution formula in subdivision (b) or (c) of Section 99312 of, and Sections 99313 and 99314 of, the Public Utilities Code.
(C)Twenty percent of the annual proceeds of the fund is hereby continuously appropriated to the Strategic Growth Council for the Affordable Housing and Sustainable Communities Program created by Part 1 (commencing with Section 75200) of Division 44 of the Public Resources Code. Of the amount appropriated in this subparagraph, no less than 10 percent of the annual proceeds, shall be expended for affordable housing, consistent with the provisions of that program.
(2)Beginning in the 201516 fiscal year, notwithstanding Section 13340 of the Government Code, 25 percent of the annual proceeds of the fund is hereby continuously appropriated to the High-Speed Rail Authority for the following components of the initial operating segment and Phase I Blended System as described in the 2012 business plan adopted pursuant to Section 185033 of the Public Utilities Code:
(A)Acquisition and construction costs of the project.
(B)Environmental review and design costs of the project.
(C)Other capital costs of the project.
(D)Repayment of any loans made to the authority to fund the project.
(c)Beginning in the 201617 fiscal year, one billion dollars ($1,000,000,000) of the annual proceeds of the fund shall be transferred to the Retail Sales Tax Fund if both of the following conditions are met:
(1)The remaining annual proceeds of the fund, after the appropriations in paragraphs (1) and (2) of subdivision (b), equal or exceed one billion dollars ($1,000,000,000).
(2)The amount of revenue collected by the State Board of Equalization for allocation to local transportation funds pursuant to Section 29530 of the Government Code in the applicable fiscal year equals or exceeds one billion dollars ($1,000,000,000).
(c)
(d)In determining the amount of annual proceeds of the fund for purposes of the calculation in subdivision (b), the funds subject to Section 39719.1 shall not be included.
SEC. 3.Section 7202.1 is added to the Revenue and Taxation Code, to read:7202.1.(a)In any fiscal year in which funds are transferred to the Retail Sales Tax Fund pursuant to subdivision (c) of Section 39719 of the Health and Safety Code, one billion dollars ($1,000,000,000) of the annual proceeds of the Retail Sales Tax Fund is hereby continuously appropriated, notwithstanding Section 7204 or Section 13340 of the Government Code and without regard to fiscal years, as follows:
(1)Fifty percent to the Department of Transportation for maintenance of the state highway system, or for projects contained in the State Highway Operation and Protection Program prepared pursuant to Section 14526.5 of the Government Code.
(2)Fifty percent to the Controller, for apportionment to cities and counties for local street and road purposes pursuant to the formula contained in subparagraph (C) of paragraph (3) of subdivision (a) of Section 2103 of the Streets and Highways Code.
(b)Funds that are transferred to the Retail Sales Tax Fund pursuant to subdivision (c) of Section 39719 of the Health and Safety Code shall be considered part of the revenues allocated to local transportation funds pursuant to Section 29530 of the Government Code.
SECTION 1.Section 8603 of the Revenue and Taxation Code is amended to read:8603.As used in this part motor vehicle includes any self-propelled vehicle operated or suitable for operation on the highway, but does not include a vehicle used exclusively upon stationary rails or tracks.
As used in this part motor vehicle includes every any self-propelled vehicle operated or suitable for operation on the highway, except, but does not include a vehicle used exclusively upon stationary rails or tracks.
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Date
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Status
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| Feb 17, 2016 | Read first time. To print. |
| Feb 18, 2016 | From printer. May be heard in committee March 19. |
| Mar 17, 2016 | Referred to Coms. on TRANS. and L. GOV. |
| Mar 18, 2016 | From committee chair, with author's amendments: Amend, and re-refer to Com. on TRANS. Read second time and amended. |
| Mar 28, 2016 | Re-referred to Com. on TRANS. |
| Apr 12, 2016 | In committee: Set, first hearing. Failed passage. Reconsideration granted. |
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Date
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Description
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Location
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Votes
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| Apr 11, 2016 | Reconsideration. | Assembly Standing Committee on Transportation |
Passed |
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| Apr 11, 2016 | Do pass and be re-referred to the Committee on [Local Government] | Assembly Standing Committee on Transportation |
Failed |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
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Organization
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Position
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Date
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| California Chamber Of Commerce | ** Against | Apr 11, 2016 |
| California Environmental Justice Alliance | * Support | Jun 20, 2018 |
| California Transit Association | * Support | Apr 11, 2016 |
| Center For Environmental Health | * Support | Jun 20, 2018 |
| Center on Race, Poverty and the Environment | * Support | Jun 20, 2018 |
| Clean Water Action | * Support | Jun 20, 2018 |
| Coalition for Clean Air | * Support | Jun 20, 2018 |
| Environmental Working Group | * Support | Jun 20, 2018 |
| Howard Jarvis Taxpayer Association | ** Support | Apr 11, 2016 |
| NRDC | * Support | Jun 20, 2018 |
| Sierra Club California | * Support | Jun 20, 2018 |
Date of Hearing: April 11, 2016
ASSEMBLY COMMITTEE ON TRANSPORTATION
Jim Frazier, Chair
ABPCA Bill Id:AB 2094 (
Author:Obernolte) – As Amended Ver:March 18, 2016
SUBJECT: Transportation: Greenhouse Gas Reduction Fund: state and local transportation funds
SUMMARY: Transfers $1 billion annually from the Greenhouse Gas Reduction Fund (GGRF) to the Retail Sales Tax Fund to allocate to regional and local transportation agencies as part of the existing Transportation Development Act (TDA) process, and then allocates an equivalent $1 billion from the Retail Sales Tax Fund to the state and local governments for road improvements. Specifically, this bill:
- Declares that this bill complies with Article XIX of the California Constitution which prohibits loans from local transportation funds and prohibits the expenditure of money in a local transportation fund for purposes for which it was not authorized.
- Declares that this bill does not change the current collection level and allocation of the sales and use tax to local transportation funds.
- Requires $1 billion from the GGRF be transferred to the Retail Sales Tax Fund if:
- $1 billion is available from the GGRF after the required 60% continuous appropriations for affordable housing and sustainable communities, transit, and high-speed rail; and,
- The amount of taxes collected for local transportation funds equals or exceeds $1 billion.
- Requires $1 billion be allocated from the Retail Sales Tax Fund be continuously appropriated with:
- 50% to the California Department of Transportation (Caltrans) for maintenance projects or the State Highway Operations and Protection Program (SHOPP); and,
- 50% to cities and counties based on existing distribution formulas for local streets and road maintenance.
- Declares that GGRF funds transferred to the Retail Sales Tax Fund shall be considered part of the revenues allocated to local transportation funds.
EXISTING LAW:
- Protects local transportation funds from being transferred, diverted, appropriated, borrowed or loaned for other purposes.
- Provides state funding through the Local Transportation Fund (LTF) of the TDA, which is derived from a 1/4-cent of the general sales tax collected statewide. These funds are distributed to each county according to the amount of tax collected in that county. LTF funds a wide variety of transportation programs, including planning and program activities, pedestrian and bicycle facilities, community transit services, public transportation, and bus and rail projects. In limited cases, counties may also use LTF moneys for local streets and roads construction and maintenance.
- Requires the California Air Resources Board (ARB), pursuant to AB 32 (Núñez), Chapter 488, Statutes of 2006, to develop a plan of how to reduce statewide greenhouse gas emissions to 1990 levels by 2020. Under AB 32, ARB is authorized to include the use of market-based mechanisms to comply with these regulations (cap and trade).
- Establishes the GGRF in the State Treasury and requires all money collected pursuant to cap and trade, with limited exceptions, be deposited into the fund and makes the GGRF funds available for appropriation by the Legislature.
- Established the Affordable Housing and Sustainable Communities, the Low Carbon Transportation, and the Low Carbon Transit Operations programs and continuously appropriates 60% of GGRF fund proceeds, beginning in the 2015-16 fiscal year, for transit, affordable housing and sustainable communities programs, and high-speed rail.
- Requires, pursuant to SB 535 (de León), Chapter 830, Statutes of 2012, that a minimum of 25% of the moneys available in GGRF be used to benefits disadvantaged communities.
FISCAL EFFECT: Unknown
COMMENTS: This bill would essentially “swap” $1 billion derived from the state’s cap and trade program with $1 billion of funds collected for the LTF. This bill would then require that the cap and trade funds be expended for the existing purposes of the LTF, including local planning and transit programs, and the $1 billion of LTF funded that have been “swapped” be allocated to Caltrans and local governments for road maintenance.
The author states that “California roads are in a serious state of disrepair and the funding situation is just as bleak.” He states that according to a February 2016 report by the Legislative Analyst (LAO), the state has significant ongoing maintenance needs including an annual funding shortfall of $2 billion in maintenance and the State Highway Operation and Protection Program (SHOPP).
The Legislature and the Administration continue to discuss state and local transportation needs for deferred maintenance and funding solutions for the problem. Governor Brown identified the $59 billion backlog of maintenance on the state highway system as a priority in his State of the State address in both 2014 and 2015. Additionally, in June 2015, the Governor called a Special Legislative Session on transportation directing the Legislature to act on a permanent, sustainable funding source for state and local transportation infrastructure.
Local governments are also facing a nearly $80 billion shortfall in funding for local streets and roads. Additionally, the loss of funding for the State Transportation Improvement Program (STIP), which received a $754 million cut this year by the California Transportation Commission due to reductions in the gasoline excise tax, has caused projects to be delayed or cancelled.
The author states that infrastructure is a core function of government and California’s economy and residents deserve better. Adding that it is crucial that the Legislature identify ways to improve funding for deteriorating state highways and local roads. He contends that this bill would help address these funding needs by redirecting the 0.25% sales tax that is currently going to fund local transit projects back to state and local roads.
Currently, a 1/4-cent sales tax collected statewide is deposited in LTF in the Retail Sales Tax Account and funding is distributed to each county according to the amount of tax collected in that county. The funding is used for transportation activities authorized by the TDA which was enacted in the early 1970’s. Regional transportation planning agencies, transit agencies and cities and counties utilize LTF funds a wide variety of transportation programs, including planning and programming, pedestrian and bicycle facilities, community transit services, public transportation, and bus and rail projects. Additionally, some counties, usually in rural areas, may also use LTF moneys for local streets and roads construction and maintenance.
Committee Concerns: Although the need is great and funding discussions have yet to yield a solution, AB 2049 is likely not constitutional and also raises numerous concerns for the use of funds and for the agencies that would be affected. Specifically, Article XIX of the California Constitution protects local transportation fund revenues from being transferred, diverted, loaned or borrowed for any purposes other than those authorized in the TDA. Additionally, Article XIII prohibits any change in distributing the Bradley-Burns Uniform Local Sales and Use Tax Law, which authorizes collection of the 1/4 cent statewide sales tax. Also, current law does not allow funds from the GGRF to be used for any programs that do not have a clear nexus to greenhouse gas emissions reductions as required by AB 32.
Although the author contends that the “swap” would not violate law and would also provide a nexus to AB 32 due to LTF funds being used on transit, which is questionable and does not accurately reflect how LTF funds are currently used. LTF funds are currently used for planning and programming activities by regional transportation agencies and in some areas, after a finding of no unmet transits needs, counties can use their LTF funds for local streets and roads. In commenting on this bill, the Rural Counties Task Force (RCTF), who represent 28 rural county transportation planning agencies and local transportation commissions, noted that they are concerned that any swap of greenhouse gas funds for LTF will open the door to possible restrictions on the current eligible uses of LTF funds that are critical to regional transportation planning agencies functions and transit operators statewide. RCTF added a concern that current LTF funds that are used for local street and road maintenance which may not be an eligible use for greenhouse gas funds.
Additionally, if funds from the GGRF were “swapped,” the receiving regional and local agencies would be responsible for all spending and reporting requirements that accompany this funding source including documenting greenhouse gas reductions and directing 25% of funds to benefit disadvantaged communities.
Double referral: This bill will be referred to the Assembly Local Government Committee should it pass out of this committee.
REGISTERED SUPPORT / OPPOSITION:
Support
Howard Jarvis Taxpayer Association
Opposition
California Chamber of Commerce
Analysis Prepared by: Melissa White / TRANS. / (916) 319-2093
Discussed in Hearing
4MIN
Senate Standing Committee on Environmental Quality
8MIN
Senate Standing Committee on Transportation and Housing
Bill Author
Bill Co-Author(s):