Assembly Standing Committee on Transportation

Good afternoon. The Assembly Transportation Committee is called to order. Welcome, everyone. The hearing room is open for attendees- attendance of this hearing and it can be watched from a live stream on the Assembly's website.

We seek to protect the rights of all who participate in the legislative process so that we can have effective deliberation and decisions on the critical issues facing California. In order to facilitate the goal of a hearing as much. Excuse me.

In order to facilitate the goal of hearing as much from the public, within the limits of our time, we will not permit conduct that disrupts, disturbs or otherwise impedes the orderly conduct conduct of legislative proceedings. We will not accept disruptive behavior or behavior that incites or threatens violence.

We encourage the public to provide written testimony by visiting the committee website. Please note that any written testimony submitted to the committee is considered public comment and may be read into the record or reprinted. We will allow two minutes each for two primary witnesses in support and opposition of the bill.

As a reminder, primary witnesses in support must be those accompanying the author or who otherwise have registered a support position with the committee. And the primary witnesses in opposition must have their opposition registered with the committee. All other support and opposition can be stated at the standing mic when called upon to simply state name, affiliation and position.

With that, we will begin our hearing. And I heard someone was two seconds away, so hopefully by the time we finish all the call, we'll have a quorum. Secretary, can you please call the roll. Somebody's walking in.

[roll call].

All right. They didn't make it in within their two seconds that they said they were. So we do not have a quorum. So we will start as a subcommitee. And the moment we can establish a quorum, we will pause the proceedings and establish that quorum. At this time we are hearing one particular bill.

It is SB 63 by Senator Wiener. This bill was heard in our committee on July 7th and passed out with the understanding that it would be amended significantly once it left our committee. This bill has been amended quite a few times since then. And today we will discuss those amendments and consider additional amendments.

With that, I would like to invite the author to open on the bill. And as I understand it, Senator Arreguin as a co author will also be providing testimony.

Thank you very much, Madam Chair. And two seconds is a very abstract comment or concept. Thank you for hearing the bill today and thank you for working with us on this bill and thank you for the latitude between the last hearing and now to be able to continue working on it.

This bill reflects really multiple years of county by county work, particularly over the past year where with an intensive negotiation among five counties. To be- To ensure that BART does not collapse. Because I want to be crystal clear, without this BART will collapse.

And I'm not being melodramatic when I say that BART will be a shadow of what it was. Muni will have to cut service by up to 50%. One half of Muni service will go away. AC Transit, Caltrain, massive service service cuts. I'm not being dramatic. This is factual.

And so starting actually two and a half years ago, we began. We, we saw this coming. These the Bay Area transit system structural financial problems long predated the pandemic. We people blame the pandemic. This has been a problem for a long time because the State of California doesn't do enough for transit.

And we've known for a long time that we need a longer term structural fix. And there was work before the pandemic to do that. It got put on hold for a variety of reasons. The pandemic hit and made things worse and put a spotlight on it.

And the systems are recovering but the structural problem persists and it's even worse. And so several years ago we started on the path of how do we actually get there to stabilize these systems we without having to go back to the state every year.

We started out with a proposed bridge toll increase as the chair will remember and others as well. I thought that was a good idea. It did not go over very well. And so we pulled back on the bridge toll increase. We then last year introduced a revenue measure that passed the Senate.

But because of internal dissension, particularly Santa Clara County, it was very, very unhappy. It decided we needed further conversation. And so we hit the pause button rather than potentially create longer term rancor within the region. So we hit the pause button and we.

Senator, I'll ask you to pause for one moment. Secretary, could we please establish a quorum?

[establishing of quorum].

All right, we established a quorum. Thank you.

Thank you so after we had internal dissension among the counties last year, we hit the pause button so we could have continued conversation. And then we entered this year thinking that this measure might be a three county measure. Contra Costa, Alameda and San Francisco counties.

And with the hope and the invitation to San Mateo County and Santa Clara County to join, I thought that there was a path with San Mateo County. I thought there was no path with Santa Clara County coming into this year. And over the course of the year, incredibly productive conversations among the five counties happened.

I want to be clear, this was not like me waking up one day and say, I'm going to write a bill with this expenditure plan. This was a negotiated expenditure plan among the five counties and with the operators. And we made incredible progress with both San Mateo county and Santa Clara County.

And I am so grateful for the broad local participation in both counties. I had many, many conversations with local electives in both counties. And ultimately last month, San Mateo County and Santa Clara County opted in.

In San Mateo County, it was the Sam Trans board voted to opt in the County Transportation Authority, Caltrain, CCAG, which is a local government group, and then the VTA Board of Directors with the support of Mayor Mahan and the Board of Supervisors voted to opt in. And so we have this very, very heavily negotiated expenditure plan.

I think it is very solid. It will be funded by a half cent sales tax in four counties. One county, San Francisco, will be a full cent sales tax. So I am asking my city, my neighbors, to pay a full cent instead of the half cent because we all have to do our part.

And San Francisco sits at the hub of a lot of these systems. The bill sets up a very strong accountability mechanism. I want to, first of all, we've for quite some time has had a financial efficiency review to try to really make sure that these systems are being as efficient as they can be.

When some questions came up, particularly in San Mateo County about accountability, and I want to just acknowledge, and I represent almost 20% of San Mateo County, not as much as my colleague Ms. Papan, but I represent, and I represent a pretty transit dependent part of the county.

There were concerns about accountability because San Mateo County does not have representation on the BART board or on Muni because San Mateo County 60 years ago decided to opt out of BART and wanting enhanced accountability. Senator Arreguin, my joint author, I'm very grateful to Senator Arreguin's collaboration.

We proposed an accountability mechanism with a 10 member board that if counties had concerns, they could file a complaint with the board and up to 5% of that operator's funding could be withheld until the problem was resolved.

We have a different approach today that the chair has proposed and I accept the committee's amendments, that if a county has an issue with an operator, there will be bodies specific to each operator with only the counties that are- that are- that have those operators. So Caltrain would be, would be Santa Clara, San Mateo, San Francisco counties.

BART would be four of the five counties, including San Mateo and AC Transit would be Contra Costa, Alameda, et cetera. You could file a complaint.

And then after an opportunity to cure, if it's not cured, the board, two commissioners from each of those of the impacted counties could vote to withhold 3.5% of that operator's allocations for the first 90 days. And if it's not resolved by day 90, it can withhold up to 7%.

And then after 180 days, a majority of the board could release the money if the problem has been resolved. And if there's a tie for the initial withholding, the tie goes to withholding. So this is a very, very real threat to an operator that's not doing what it needs to do.

And I am very appreciative to the chair and her staff for some creative thinking around this. I want to just say that public transportation is part of the Bay Area's lifeblood. The Bay Area would not be the Bay Area without transit.

And we saw it again last Friday when BART unfortunately had a computer glitch and so the system was down. And this has happened a few times and they need to get that computer improved. But even when BART goes down for two or three hours, try getting anywhere on the roads of the Bay Area.

Not only do we have people who can't get to work or school on BART, but people who are trying to drive can't get where they're going either. This is real. This is high stakes. We need to get this to the region so that the Bay Area can engage in self help again.

I'm so grateful to the many people around the region who have participated in this process and I respectfully ask for an aye vote. And if Senator Arreguin has a few remarks, Madam Chair.

Thank you, Madam Chair and committee members. I don't want to repeat, I think the great presentation Senator Wiener provided. I just want to put this in context once again. Senator Wiener touched upon the computer glitch that shut down the entire BART system last Friday, which resulted in massive traffic jams throughout the Bay Area.

That will be a daily reality if we do not pass SB 63 and succeed at getting it passed at the ballot box. And just to put this in context, some people said, well, let's take more time. We can't wait.

We know that we're facing a fiscal cliff next year while we are working to try to get the Governor to agree to the $750 million loan that was in the budget act to provide at least one year's bridge funding.

After that, there is no plan for how we're going to ensure the solvency of our transit systems in the Bay Area. A lot of work's been done over the past several years because of the budget realities.

Cutting staff, looking at efficiencies, the efficiency review, that's I think, a very critical component of this bill will provide even greater focus on how these agencies can look at either through consolidation of operations or looking at ways to improve service and raise revenue.

They can have a long term plan for financial sustainability because we just don't want to give, we don't want to be here 14 years from now trying to do another sales tax measure. And the voters demand accountability.

If we're going to ask voters in these counties to approve a sales tax increase in a region that has a very high cost of living, there needs to be accountability. There needs to be oversight.

We need to make sure that these dollars are being spent effectively and that we are making sure that these transit systems are operating efficiently, that we're improving the rider experience, that we're improving accessibility of transportation, the Bay Area. That's what this bill does.

And I just want to lift up as well the accountability measures, I would argue, some of the strongest accountability measures of any tax proposal that's probably gone through this Legislature in recent memory.

And it's really a credit to, I think, the work of the chair, Assemblymember Papan and leaders throughout the Bay Area and operators who have really come to the table in the spirit of trying to ensure strong accountability and oversight of this measure. But it's critical that this move forward today.

We don't have a plan for what's going to happen if we don't succeed. We know what the impacts will be.

It will leave thousands and thousands of people in the Bay Area stranded, and that will have also a huge impact on not just the Bay Area's economy, but the entire State of California's economy, given the significant importance of the Bay Area as an economic engine.

So I join my colleague in thanking the chair, thanking the committee staff for your work, and respectfully ask for an aye vote.

Thank you and as I understand it, we do have witnesses in support. As a reminder to those witness in support, you have two minutes. You can wait. I'm sorry. Yeah. My apologies. Lead witnesses in support who will be providing testimony. As a reminder, you each have two minutes and- and then we'll move

to those in opposition, you can begin at your convenience.

Good afternoon, Chair Wilson and committee members, Senators Wiener and Arreguin. My name is Sebastian Petty and I'm pleased to be here on behalf of SPUR, the San Francisco Planning and Urban Research Association, to provide testimony in support of SB 63.

SPUR has supported SB 63 since its inception because we are clear eyed that the Bay Area's transit system is in deep fiscal crisis. And we understand that this is our last chance to get sustained regional funding. The only viable path to keep our buses and trains running.

Muni, BART, AC Transit and Caltrain transit agencies that collectively carry more than 80% of the Bay Area's million plus daily riders, are at risk of severe service cuts over the coming year unless the region secures a new revenue stream.

The crisis transit is facing is national and ominously, the Bay Area can now see the potential future we are trying to avoid starting to play out in other states and regions. In Pennsylvania, the state has failed to address transit's funding needs and consequently Philadelphia's transit system, SEPTA, has moved forward with large scale cuts.

The first major Metro Area to head over the fiscal cliff. The result has been chaos. Riders have been stranded, employers are frustrated, the city is having to backfill funding for some school oriented routes from its own coffers.

Lawsuits have been initiated over other cuts, and professional sports teams have turned to betting sites to temporarily cover the cost of game day transit.

Longer term, Bloomberg estimates that the economic impact of sustained transit cuts in the Philadelphia region will include 76,000 lost jobs, 6 billion in lost wage growth and nearly 20 billion in impacts to home values. This is in regards to a transit system and a region that are both smaller than the Bay Area.

There is no obvious solution in sight. Cities like Chicago, Dallas, Washington, D.C., Portland, and of course the San Francisco Bay Area will soon face similar catastrophes without intervention. As SB 63 has advanced through the Legislature, the theme of accountability has understandably emerged as a critical focus. Transit's financial significant.

Thank you. All right, next witness. As a reminder, two minutes.

Good afternoon, chair and members of the committee. I'm Jason Baker, Director of Government Affairs for Caltrain. Our system provides regional rail connection through Santa Clara and San Mateo counties and into the city and County of San Francisco. Thank you, Assemblymember Papan and Ahrens and Chair Wilson.

This effort has come a very long way from an idea to SB 1031 to the bill in its current form. And you all had a great deal to do with making this bill better. It took a long time and a lot of amendments to get to where we are.

But this bill is significantly better and it is the product of a lot of tough compromise. Thank you Senator Wiener and Senator Arreguin for your work along the way. Public Transit appreciates it.

I know some concerns remain, but what I want to underscore is that this bill, this funding, is absolutely vital to Caltrain and to the survival of transit in the Bay Area. We together just invested $2.44 billion of public money to electrify Caltrain, the first railroad in the nation in a generation to do that.

At our one year anniversary coming up in a couple weeks, it's clear that investment is a success. Our ridership's up over 78% over last year. Our farebox recovery is once again nation leading. We're at 65% of our pre pandemic ridership and our weekend service is over 100% of our pre pandemic ridership.

But without this funding, that investment, Caltrain and its success story will not continue. There is no other option. Let me tell you in no uncertain terms that Caltrain service without this lifeline would look very, very different. We would likely have to cut weekend service that's been so successful.

Look at skipping stops, some closures of stations, and potentially going to hourly service. And the worst thing is, we're not confident that even those draconian cuts would save caltrain. Because for caltrain, cuts mean an unknown but definitely significant loss of ridership and farebox recovery.

So you cut to save and you may end up costing yourself as much or more than you than you save because you lose farebox recovery. We've come a long way. We urge you to give voters the chance to save the Bay Area transit.

We think they'll do it and the Bay Area, our economy, our air and our quality of life will be much better for it.

Thank you. Thank you. All right, now moving on to MeToo comments. This is that opportunity for members of the public to be able to come and add on and support. So name, affiliation and position, please.

Steve Hansen from Lighthouse Public Affairs, on behalf of SPUR and Abundant SF in support. Thank you.

Andrew Fremier, Executive Director at MTC. From the beginning, our leadership has really supported one of the support.

We'll have to limit it. We'll have to limit to name.

Thank you. We support

Affiliation and position. Thank you.

Madam Chair and members. Alex Torres on behalf of the Bay Area Council, representing over 350 employers in the region and strong support. Thank you.

Thank you.

Good afternoon. Alex Walker on behalf of the San Francisco Bay Area Rapid Transit District in support. Thank you.

Good afternoon. Alicia John Baptiste on behalf of San Francisco Mayor Daniel Lurie in support.

Good afternoon, Steve Wallach on behalf of the Alameda County Transportation Commission, the Golden Gate Bridge Highway Transportation District, the Napa Valley Transportation Authority. All in support on behalf of the Alameda Contra Costa Transit District. They currently have a support and seek amendment position, but with these amendments we're reviewing the bill to hopefully go to a straight support.

Madam Chair and members. Delaney Hunter on behalf of the Santa Clara Valley Transportation Authority in strong support. Thanks for inviting us.

Madam Chair and members, Nick Roma on behalf of the City and Mayor of San Jose in strong support.

Chair and members, Carlin Shelby on behalf of the Trans Bay Joint Powers Authority and the cities of Oakland, Emeryville, San Pablo and Union City in strong support. Thank you.

[unclear], Seamless Bay Area San Mateo County resident and with 100 transit riders rallying in San Francisco this morning in support.

Good afternoon, chair and members Jordan Grimes on behalf of Environmental Nonprofit Greenbelt Alliance as well as a lifelong San Mateo County resident in strong support. Thank you.

Good afternoon, chair and members. Jeanne Wardwell on behalf of TRANSFORM in support.

Ethan Nagler on behalf of the City of El Cerrito, in strong support.

Good afternoon, Madam Chair and members. Rosanna Carvacho Elliott here on behalf of the City of Alameda, also in support. Thank you.

Good afternoon. My name is Sarah Bars. I'm a San Francisco resident and a member of the San Francisco County Transportation Authority, CAC in strong support.

Good afternoon. Evan Chewy with Rise to Nature in strong Sport.

Good afternoon. My name is Austin Mulford Rosales. I'm a member of the San Francisco County Transit Authority CAC. Strong support.

Madam Chair, Nicolo DeLuca on behalf of the Livermore Amador Valley Transit Authority in strong support. And really appreciate the help for the small bus operator. So thank you.

Good afternoon. Chris Lee on behalf of the Eastern Contra Costa Transit Authority in support.

Good afternoon. Claire Mark on behalf of Transbay Coalition in support.

Good afternoon. Terrence Kandel on behalf of San Francisco Bay Ferry in strong support.

Good afternoon. Emily Beach from the San Mateo County Transit District and San Trans in support. With the strongest achievable accountability, we'll have to eliminate measures and we look forward to the amendments. Thank you.

Hi there. Eileen Mariano on behalf of the city and County of San Francisco in support.

Brendan Rupicki with the Central Contra Costa Transit Authority in support. And we thank you Madam Chair.

Leanne Chang. I'm a San Francisco organizer of this morning's 200 person rally to save Bay Area Transit in strong support. Thank you.

Hi there. Alex Sweet on behalf of the San Francisco Municipal Transportation Agency in support.

Thank you.

John Anderson for 350 San Francisco in support.

Sarah Greenwald, 350 Bay Area supports this measure.

Vince Shakala, resident of Berkeley, California and Caltrans staffer in support.

Duncan McVetridge on behalf of the State. Association of Electrical Workers representing nearly 1,000 workers at AC Transit and Muni in strong support.

Thank you. Now moving on to opposition. We don't have any registered witnesses in opposition but now would be an appropriate time for anybody to register as an add on in opposition to this bill to come forward. It will be name, affiliation and position. Seeing none. Now moving it back to members of the committee. Harabedian.

Had a question about petition filing process and how that would work. Thank you. The petition filing process and how that would work for the ad hoc committees. And what the limitations are for them.

Sure. So the ad hoc committees, the way it would work is each operator will have its own Committee that will have two MTC commissioners from the covered counties. So for AC Transit would be two from Contra Costa, two from Alameda. Caltrain will be two each from San Francisco, San Mateo, Santa Clara and Muni will have three counties.

BART will have four counties. All of them except for Santa Clara County and San Trans and BTA will not have accountability committees but the other operators will. And the reason for that is those operators are really within their county. So we focus most on the multi county operators.

And what will happen is any county Trans of any county transportation authority or Board of Supervisors can lodge a complaint that you know, BART is not doing this or Muni is not doing that and it will then go to that committee and they'll get sort of an admonition to try to a grace period to fix the problem.

If they don't fix it, then the board for that operator will vote. If it's a majority in favor of withholding funds or a tie, then up to 3.5% can be withheld for the first 90 days. If at day 90 the problem has not been resolved, the board votes again.

And if they vote in favor or a tie, then up to 7% is withheld. Once you hit then 180 days a majority vote of the board can release the funds and determine whether the problem's been resolved. It is a- it's a, I think pretty tough, tough love kind of accountability.

It's not something that I am inherently comfortable with, but I think it's a reasonable approach. And so that is how the accountability and that that's to my knowledge, unprecedented. In addition to the MTC has broad authority, if an operator is not complying with the law to- to decline to provide funds until the problem's resolved.

That's like an inherent broad authority. But then there's a specific in terms of this structure the chairs proposed and I' accepted. I have never heard of any accountability provision for a transit operator. The strong maybe it exists somewhere. I've never heard of it.

Thank you, Assemblymember Lackey.

Yeah, I'm sorry that I don't just see this as a rescue plan, unfortunately. Instead it seems to be a taxpayer bailout for systems that refuse to reform. Transit agencies are asking for more money while doing nothing. At least it doesn't appear to be to cut their expenses, improve service or earn back public trust.

Budgets are up, but ridership's down and there appears to be little oversight. No real hard choices on their part. And now we're trying to push a regressive tax under the ballot by dodging the two thirds vote of the people, which usually the law requires.

Working families unfortunately appears like they'll be paying more while local priorities like public safety and childcare get pushed aside. This isn't about just keeping trains running. It's about keeping a broken bureaucracy funding, no matter what the cost. And so I find it an unfortunate remedy.

And I know you've been working hard and I know, I don't doubt that you're very sincere about the exigency and the difficult circumstance. I. I'm very sympathetic to transportation and know how public transportation is critical, especially in the Bay Area. But this seems to be the wrong approach to me and that's all I got.

Thank you,\. Assemblymember Papan.

Thank you so much, Madam Chair. So I, as you can well imagine, don't have much of a question, but rather I do have a statement about the bill now and how my county is still not accounted for. So I want to start with transit's broken record.

These transit agencies are asking us to save them, but they can't save themselves. Barrier transit operators have been failing to manage themselves adequately, as evidenced by most recently the BART faregate issue.

For years, BART was losing upwards of $30 million a year in fare evasions, yet they refused to upgrade the fare gates until they were really pushed to it. And then of course they said to my county, well you go find the 10 million to upgrade the fare gates.

The mismanagement extends to the most basic of ridership needs such as working escalators, operational bathrooms and safe stations. And that says nothing about their job as transit managers. They have continued to fail in making connectivity easy and and effective for the riders.

With the proposed version of SB and all along MTC, which is the Metropolitan Transportation Commission has given them the license to act without accountability. With the proposed version of SB 63, taxpayers are now being asked to bail out those same operators with no power to regularly monitor or enforce performance.

I think this is a missed opportunity for real and fair oversight so that not only are we providing money and a bailout to the transit agencies, but we're also asking for economic stability. I don't believe that money for a bailout and accountability are mutually exclusive. Not by any stretch of the imagination.

Without real accountability, problems are going to persist. So San Mateo county taxpayers ambassador contribute billions. That's with a B folks in new sales tax revenue. Yet governance rests with MTCs. Nine county board, five counties are being taxed. Nine counties are calling the shots. That is fundamentally undemocratic. That is not taxation

with fair and full representation by those actually being taxed. I proposed a 10 member board accountable to the voters who are paying the bill.

The board would conduct annual reviews in addition to a local petition process and retain the right to withhold up to 15% of funding for up to 180 days if operators fail to meet performance metrics. That's not draconian, that's basic accountability. Simply requiring operators to deliver the service taxpayers are paying for.

Under the proposed version of the bill, which was amended late in the game, each county can petition a grievance once a year. That is reactive, not proactive management. These last minute amendments preserve a fiefdom perpetuating the ineffectiveness we've had all along. I've spoken with commissioners on MTC who have absolutely no objection to a 10 member governing board.

Yet MTC staff was throughout this building fighting for such, fighting against such a structure. I want to turn now to some of the allocation particulars. My county was asked to pay on behalf of San Francisco Muni, a good portion of their payment to Caltrain that just sat here and testified.

The result is my county will front $56 million of Muni's contribution to Caltrain. So my county said, hey, we're also going to support Muni can we have a haircut on what we're giving Muni because we're going to front the money to caltrain. They were told no. San Mateo is the economic engine of California.

If my county is forced to accept this bad deal, the consequences extend far beyond our borders. A bad deal for San Mateo is a bad deal for the entire state. Now, as we go forward, given how much the bill has changed, there were votes in my county. They never saw the bill in its current form like this.

So given how much the bill has changed and how different this language is from the negotiations that were taking place even a week ago, I would like to request that the bill be amended to include an opportunity for an opt out. For an opt out county to opt out in January.

We can have alternate language that says if a county ops out, here's how the bill should read and it's triggered. If a county should opt out. My county didn't see this bill. San Mateo county is really being asked to write a blank check again. This is taxation without fair representation by those being taxed.

This is a sales tax. During a time when we are really focused on delivering affordability to our constituents, the least we could do is pride, that is provide them with proactive material accountability and oversight. For these reasons, I will be casting a no vote.

Thank you, Assemblymember Papan. Before I get a chance to turn it over to the response, I will note two things. One, I didn't- I just went straight from Lackey to happen without giving you a chance to comment. So if you'd like to comment, you could include that in there.

I just wanted to note my apologies for not giving an opportunity to, for both you all to have a discourse on that. Secondly, the bill is heavily negotiated. We don't negotiate from the dais. And we were negotiating this bill all the way up until Saturday. I'm sorry, last night at 10pm to figure this out.

And so just want to note that for the record, assemblymember, I'm sorry, Senator Wiener, a response and of course Senator Arreguin, you are a joint author. You can also provide comments on anything that's stated today.

Thank you very much, Madam Chair. And first of all, I want to thank Assemblymember Papan, my neighbor to the south. We, she and I have had significant engagement on this bill.

We've spent a lot of time together, particularly on the phone in recent weeks to try to come to an agreement and we did not come to an agreement. We both tried in good faith to do it and we, and I know I want to and I've expressed this to the assemblymember.

There were some significant things that she asked for that I was willing to agree to, like creating an entirely new agency to administer this. We get criticized a lot in the Bay Area that we have, I think 27 or 28 transit agencies. We get criticized harshly for that because it means more administrative overhead.

The assemblymember wanted this to be a separate agency from the MTC, a new agency, and a lot of people had problems with that. I agreed to it and I convinced some other people to accept it. But there were aspects to what the assemblymember asked for that went beyond what we could agree to.

And I wish we could have come to an agreement. I very much wanted to. I want us to all be locking arms. We spent a lot of time, I think, because we both wanted to come to an agreement in good faith and we didn't get there.

As I described at the beginning, this bill has the strongest public transportation agency accountability, harsh accountability measures that I have ever seen. And so I can understand, I respect any desire to have different or more. But to say that there's no accountability in here is simply inaccurate. You know, San Mateo County opted in.

They opted in to the expenditure plan that's in the bill. After almost a year of negotiation, they opted in. Multiple bodies opted in. And, you know, also, it's really easy to criticize BART or any other system. BART has struggled a lot. When you lose half your ridership, they're going to have some challenges.

BART has made dramatic improvements in the last few years, dramatic improvements in cleanliness and safety and replacing the fare gates so that it's much harder to evade. Yes, there was a situation with San Mateo County, and I want to be clear.

San Mateo County does not pay the 38 of a cent sales tax that the three BART counties pay. Does not pay the property tax that the three BART counties pay. So sometimes there are conversations about financial responsibility. My constituents pay sales tax and property tax into BART.

San Mateo County does not, because of a choice the county made 60 years ago. I wish they had made a different choice, but we do the best that we can under those circumstances. And I know that there have been legitimate concerns in San Mateo County about BART and the relationship.

And we have worked hard to try to change that relationship. And there will be accountability under this bill. And in terms of, quote, last minute amendments, this bill has been incredibly transparent. And we have all been in conversation with each other. The chair came in after Ms. Papan and I could not reach agreement and proposed amendments.

And they are in the analysis today and they're very reasonable. And so I and the final thing I want to say about San Mateo County, 3 million people a year board BART in San Mateo County, 2 million people a year board Muni in San Mateo County.

This is all a region that's interconnected and that's why this bill is so important.

Madam Chair, please be heard.

Okay, go ahead.

I think BART will remind San Mateo County every chance it gets that you are not equal. And they do so and they treat them as unequal. That's the reality here. And I think what was missed in the remarks is that no one is saying there isn't accountability.

The remarks were there is not real or fair accountability for those that are being taxed and to be lumped in with four other counties who have no investment in the tax dollars being raised by your right. A very regressive tax is not what I call fair taxation with representation.

And I'll just note because there's reference to our office working on the accountability, what is now the accountability, additional accountability within the bill is that the MTC board is somewhat of a clearinghouse for this resources. As was noted, it was heavily negotiated, the expenditure plan and the MTC board has no say on the adjudication committee.

It is accepted. So the people involved and engaged who are impacted are the ones who make the decision. The MTC Board does not have a say to not accept or to reject. They cannot reject what the Adjudication Committee says. So there are. Yes, there are four counties that are on MTC that are not taxed.

They don't have a say in this. Nor does a county have a say if they are not contributing to that particular board. I'll go to Assemblymember Ahrens.

Thank you, Madam Chair. I want to thank the senators for presenting. I want to acknowledge sometimes the frustration of the last minute legislative process and the frustration where we are in and really just trying to find a solution to a very difficult problem when it comes to our Bay Area transportation system.

I would like to see how we can continue to improve a lot of the issues that were brought up to my colleagues and want to remain committed as a member of the transportation to do that. However, with that being said, I would like to move the bill today.

Motion made seconded by so we have a motion on the floor by Ahren's and a second by Harabedian. Just noting there are committee amendments that are beyond the author's amendment.

So is that with the note of the committee amendments and then noting on the just to be absolutely clear on the agenda and notes to urgency because there was an urgency brought forth out of appropriations. The committee amendments do remove that urgency. So it includes all of the stricken out language plus the removal of the urgency.

And so just making sure my motion and second are clear on that. Thank you. Thank you.

I'm clear. Thank you.

Hold one second. We do have an order and so I can add you back in the queue, which we normally don't do, but I can add you back in the queue. Okay. Were you. Do you want to respond in any way to that? I keep wanting to make you assemblymember. My apologies for trying to.

Madam Chair.

You. You are on the green carpet a lot. I will. All right. Assemblymember Rogers.

Thank you, chair.

So I think one of the frustrations that I hear and one of the frustrations that I feel representing some of the counties that I represent is when there is history, and I don't know all of the history in a lot of these fights, and oftentimes they are fights to make sure that folks have the resources that they need to deliver for the counties that they represent, that they.

There's very few touch points or opportunities to try to correct some of what has already gone wrong. And I hear the back and forth between the two of you, specifically about the county. What I hear from you is that there's accountability, that the decisions will not be made by other counties.

I hear the opposite from my colleague, and I just want to support that all of us don't like being in that position and want to feel supported and heard when we're outnumbered, when our counties feel outnumbered. So my question is very simple, which is for San Mateo County, how are their voices heard? How is their representation expressed?

And when they feel as though they're not being heard, what is their actual ability to deliver for their constituents? And how much do counties, quite frankly, like mine, which is not in this bill, have an impact or an effect on their ability to get restitution?

Absolutely. And first of all, before I was elected to the Senate, I spent six years as a commissioner on the MTC. I actually was really one of the- I was happy to be elected to the Senate. I was really- I was- I liked local government, but I was very sad to leave the MTC. I thought it was.

I had a fantastic experience there and a fantastic experience working regionally. I know the MTC is sometimes a pinata, and that's the nature of any kind of regional body. There's always going to be, you know, people upset about different things, sometimes legitimately, sometimes not. That body would work really well together.

And I will say, I'm not just saying this because you're North Bay. The North Bay commissioners often played an incredibly productive role when there were disputes among the larger counties. And at no point did I ever see a situation where the North Bay was, like, targeting San Mateo County. I don't remember that.

San Mateo County has two commissioners in the MTC. In my experience, they have always been very strong. When I was on there, Kevin Mullen, formerly of this body, was a Commissioner on the MTC. An amazing City Council Member from Redwood City, Alicia Aguirre was on there.

Alicia Aguirre was in line to become the chair of the MTC, but then she got ousted in the local San Mateo process, so she was no longer a Commissioner. Adrienne. When I first came on the MTC, the chair of the MTC was Adrian Tissier from Daly City, San Mateo County.

So San Mateo County has been very effectively represented by very strong commissioners on the MTC. And also relating in this measure, of all the major operators, only one large operator gets 100% of its financial need met. That's Caltrain. Caltrain gets 100%, which is mostly in San Mateo County. The others get a lot, but not 100%. Caltrain does.

In addition, as I described, San Mateo County will be on the adjudication bodies for accountability for Caltrain, for Muni and for BART. I think those, I think for those three, if I'm not mistaken, and we'll have ample opportunity, first of all, for its Board of Supervisors or Sam Trans or its CTA to file a complaint.

And then we'll have two votes on each of those, either two out of six or two out of eight to be able to do an adjudication if there's been a problem. So I can understand, you can always say it should be different, it should be more. But San Mateo County absolutely has a voice.

And the last thing I want to say in terms of BART, BART, there are some issues, there have been historically some issues with BART in San Mateo County. It's also true that the frequency of BART trains in San Mateo county is higher than in Contra Costa County.

And so, you know, to say that, like, BART is out to get San Mateo County is just not true.

So back to the question about the other counties in the world that they have. What I have heard kind of referenced is that in the event that there's an adjudication, in the event that there's the three and a half percent that's withheld, that that goes up to MTC, that that's automatic. MTC has no ability to overturn that.

Can you point in the language to where it says that?

Yes. And perhaps pull this out?

We can find in the bill. Doesn't really help for those purposes.

No, that. That is right. And I will also say that the annual allocations are. Are fixed, essentially ministerial. It's a fixed plan. They can't be. I will ask my staff to like.

Staff is looking for you while staff.

Is looking for the citation. So when you bring forward complaints. Right here.

We'll give him a chance to point it out since he's not paying attention to the rest of the.

I'm sorry, he's underlining it.

I'll read it. Yeah, yeah. So when a complaint is brought forward, what criteria is used on whether to sustain or reject that complaint?

It's up to the body. They can. You know, there are obligations outlined in the bill, including maintenance of service, so they can't swap in funding for other funding. There are criteria in there and they. And it's really up to that body. So they have pretty broad latitude. And one of the. I'll read it here. This is 60.

67, 78 A. After receiving a recommendation from an ad hoc.

Hold one second. Let me make sure that everybody. It's a- Are you on page 21 of the what was provided? I want them everyone to look on. Where are you at?

It's page 30.

Just 24 pages.

Hold on a second. We're on something different.

30 in the bill. Sorry.

Give us the citation again.

It's 667. 788A. That first paragraph. After receiving a record.

Hold on a second. Page 19 of what you've been provided from staff. So if you go. Is that what you're looking at under maintenance of effort, that section? We'll pause so we can make sure. We'll have- We'll have our transportation- Transportation Committee staff tell us where it is because it's-

you guys have documents on your desk and I want you to be able to see it with yourself for yourself.

67788A.

On page 20, he's reading 67790A. Is that what you're reading?

Okay. Okay. 67788A. 67788 subsection A.

That's after five?

I think that's something else.

This is--we're talking about--this is--what I'm referring to is the adjudication. There's another one for maintenance of effort but I'm talking about adjudication.

Yeah, and I'm interested in the adjudication.

Yeah, that's what I have. It's page 30 at the top here.

Hold on. We'll go. Let me see if I can reconcile--if you turn, if you look at--I think you're looking at this document. Are you looking at this document? Okay.

I'm looking at this document.

Does everybody have this document at your desk? No, you don't? Okay, so we want to look at the document they have at their desk, so I will try to reconcile.

Sorry. I had a different version.

Let's take one moment. It is important.

Yeah. I think you have the full bill. I have the RN for the amendments. That's the difference.

The Enhanced Accountability section, just for members, starts on page 20 and goes through page 22. So it's going to be somewhere in there as he starts to read it.

Should I read it, Madam Chair, or...

Yes, we can, we can try. Hold on one second. Okay, he is going to read on the documents that you have on page 22, it starts at 67798A, it's midway through the page, and that's where he's going to be reading from on a different document. So that's page 22, 67798A.

'After, after receiving a recommendation from an Ad Hoc Adjudication Committee pursuant to Section 67786, the commission shall--not may--shall approve the recommendation, and if the Ad Hoc Adjudication Committee recommended corrective action, provide the subject operator with a period of at least 90 days to comply,' and then it goes into the rest of the process.

So the MTC has no ability to overturn that. In the original, in the original accountability proposal that we made, the MTC would be the final decision-maker based on a recommendation from the lower accountability body. It is now a shall.

And I just want to acknowledge also, even though Assembly Member Papan and I obviously have some disagreements, she did push us to strengthen the accountability and I want to give her real credit for that even though we did not come to an agreement. It would not have been as strong as it is now without her pushing very hard on that and then the chair participating in an incredibly constructive way for which I'm appreciative.

So just to make sure I'm understanding all the too, so the complaint comes in, the body meets. If 50% or more agree that there's an issue, 3.5% gets withheld.

Let's clarify. Up to, commensurate. They decide.

Up to, up to 3.5% with a corrective action plan. There's 90 days for the operator to try to correct that issue, whatever it is. If it is not corrected, you have another up to 3.5%.

So seven total, yeah.

For seven total, and then at 180 days, you mentioned a majority of the board. Do you mean of the Ad Hoc that's overseeing each of those, not the MTC Board?

Correct. After 108 days, a majority of the Ad Hoc Committee can release the funds, can make the determination whether there's been corrective action. Yep.

And prior to that, it does require each county to be a part of that majority, so that's the distinction between the first day, day one to day 180. Up until 180, a county representative from each one has to be a part of that majority.

Okay, great. Thank you.

Alrighty. Going back to Assembly Member Papan, then followed--immediately following, Assembly Member Ransom.

Okay. Just for clarification, regularly--regular monitoring as it relates to efficiency and financial responsibility remains with the nine-member board, okay? You only get one complaint per year and then that's when you end up in the ad hoc process.

But all the regular monitoring, which is why I have such difficulty with this, remains with MTC where you have four counties that are not a part of this tax. With respect to MTC voting, it's very important to note that the three biggies--San Jose, Oakland, San Francisco--each of those mayors also have representation on these MTC Board.

So they actually outnumber the folks that don't have that mayor representation. So it's very clear to point out--we can talk history, who's been chair, when, why, what, and how, but the weighted voting on that board is very important to understand.

So it is--I just want to make sure we're very clear, and my objection is that the regular monitoring should be done by those that are affected and only those that are affected, okay? And to say you are stuck in the petition process is a reactive way of monitoring how tax dollars are spent, not a proactive way, and if you operate proactively--I mean, at least I believe--perhaps you can stop errors along the way. So in any event, that's where I come from.

Thank you. Did you want to respond in any way to that? We are--I know you guys don't meet till 2:00, but we have session at 1:00, and the law, our rules say that we cannot start session without this ending. So if you don't, I'm going to go to Assembly Member Ransom. We have Assembly--I'm sorry--Vice Chair Davies.

Can we get a response to that?

Sure, go ahead, and then we're going to Ransom, Vice Chair Davies, I'm going to make remarks, we do have a motion and a second on the floor, and we'll give the author the opportunity to close. Go ahead.

Sure. I mean, there were a few things that said it. It's one per year per operator, so San Mateo County will be able to file a complaint once a year against Muni, once a year against BART, once a year against Caltrain, and you know, given that the, that the complaint process can play out over half a year or more, you can imagine if they're a county filing serial complaints and really potentially gumming up an operator. And the most important thing is for these operators to be able to provide service.

In terms of--yes, there is representation, different counties on the MTC. Santa Clara County and Alameda County are bigger counties that pay a lot of sales tax. If Mayor Mahan were here, he would be talking to you of how Santa Clara County is going to pay--I think it's more than a quarter of the regional sales tax.

Comes from Santa Clara County. San Francisco is going to be paying a full cent double what everyone else is paying. So there, there are various things in this measure that different counties can come in and say, hey, you know, I'm being, I'm not identical to my neighbor, and--but we're--again, that's why we're reading, right?

We don't have the good fortune or bad fortune of LA being one county with ten million people, we are numerous counties, and if we don't work together--and sometimes that means there's give and take--then, then we have a big problem.

Thank you.

You know what I would also add is that BART is an elected board of directors and the other agencies have appointed boards that are made up of mayors, council members, and supervisors, so there are mechanisms to ensure that the input of local governments are involved in the decision-making of those agencies to ensure ongoing implementation, accountability.

And I'll just note that the first time you can do it is two years, so there is a time to actually assess performance and you also have--you're supposed to--any of those body who wants to file a petition should work directly with the operator prior to filing a petition.

That is written in there and that was always in there and then, then you file the petition. So hopefully, it's something that's known. That's part of why it takes--it could take a whole year before something is resolved. Assembly Member Ransom, Vice Chair Davies, I'm going to make remarks and we're going to call the question.

Okay. I'll be very, very brief. Thank you for all of this exchange and the information and all the work that's happened. Just really quickly, does--everyone opted in or were there some people that were drafted? It's my understanding that every entity opted in to this.

So we started--when we first introduced the bill early in the year, it was the three BART counties because there was always an understanding that the three of us wanted to be in and that was consistent last year, this year, and then San Mateo County opted in, Santa Clara County opted in, and Santa Clara County opted in from the BTA Board of Directors, which is made up of local elected officials, mayors, supervisors.

And then San Mateo County, there were multiple votes to opt in from the SamTrans Board, from the County Transportation Authority Board, CCAG, which is a local government consortium, and then Caltrain had previously voted to support, and that's a three-county body. So they all voted to be included.

So if you didn't opt in and you're so close to all of these different regions, I mean, clearly--is it kind of like it only makes sense to opt in, otherwise, you know, everyone else is the, the funding to improve and then you don't have the funding to improve?

Yeah, there, there are like, and we--there--if a county doesn't opt in, there are of course always pros and cons. For San Mateo County, if the county hadn't opted in, then it would for its own sales, tax reauthorization would have to put more money towards--I assume, I've been told--towards Caltrain because if San Mateo County weren't in, there would be no money for Caltrain in this measure and the three counties would have to negotiate their own contributions.

And I think that's why when you look in San Mateo County, in addition to all those opt-in votes, we've had, you know, good support from labor, from business in San Mateo County and many local elected officials because they, they believe that it's in the county's interest to be in the, in that measure.

Okay, I think you answered part of my question. And then my, my, my last question--and Chair, I'll move on--um, so just to be clear, after the 3.5, it can go to a total of 7% if, you know, issues persist. Does the funding go back ultimately? There's a listing--it says something about 'held until the last allocation.' Does it ultimately go back to that region that it was held from or where does it end up?

Yeah, so the, I mean, the goal is to get everything corrected and then it's released. So they're not forfeiting the money, it's being held as a carrot or a stick or whatever.

So it's never forfeited is, is what I'm trying to get at. It always goes back to the--

Technically until the very end, at the very end if the--at the, at 15 when--

Like years from now?

Yes, it goes back to the county. It goes--returns to its source.

Okay. All right. That answers my question.

Yeah, return the source was a big issue in the budget.

And that's what I wanted to be sure of. Thank you.

Thank you. Vice Chair Davies.

Good afternoon. Just a couple questions when it comes to this bill. I mean, obviously, I think we all know this year was all about accountability, affordability, transparency, and since I've been here since 2020, regional bills have always been somewhat up in the air to me because you're having people that are in this region are not representing these people voting on something whether you agree with it or not.

And that happened to us where--not this author--this member never even came to half of the members that were representing Orange County when it came to this issue, and so to me, to have people voting--and this is the way I feel--for me to be voting on a district that I don't represent, not knowing, you know, that everyone's there, that's my biggest concern, and I guess when we talk about transparency, I believe there's 12 Assembly Members that represent these five counties, is that correct? Potentially. Yeah, likely.

I know for the Bay Area as a whole, it's about 16 or 17 Assembly Members, depending how you define that for the--it's, you know--

My question is, have you spoken to every one of these members and have they--except right now, we know with Assembly Member Papan--have they all approved this and behind it?

I have spoken to every member of the Bay Area delegation. Last year, this year, we have had Bay Area Caucus multiple meetings, including as late as last, last Wednesday, and so--

So are you answering every, every member?

Well, we, I believe, if I recall correctly, in the Senate vote, every Bay Area Senator voted for it.

Right, right.

And so I don't want to speak for anyone how they're going to vote. We have broad support in the caucus, Bay Area delegation, obviously not unanimous, and I totally respect that, but we, you know, we have very broad support because members broadly understand that if we do nothing, BART will collapse and Muni will cut service by 50% and Caltrain and AC Transit will unravel and that would be horrible for the entire region, for our economy, which, by the way, disproportionately contributes to the General Fund of the State of California--San Mateo County, Santa Clara County, San Francisco. It's in everyone's interest for this region to function and not to have gridlock traffic all day, every day, and to have people not be able to get to work.

And I'll ask, as the questions go and the comments come back, that they are more concise because we are under a time limit. Go ahead.

I appreciate it, but this is a very important issue and I want to make sure that my questions are answered. When you come to transparency, also, have you done outreach? Have all of these counties done outreach to the public so that they understand that this bill is going before us and that we would be voting for something that would possibly put a tax on?

Well, first of all, this will only happen if the voters vote for it.

Correct, but are they aware that this is even happening here?

This has been so heavily covered. There have been so many public meetings on this, including all the meetings where votes have happened, and a lot of these agencies had multiple public hearings before they even got to a hearing with the vote, so this has been an incredibly transparent and public process and there's been polling done, there's been--I mean, just, this has not been secretive in any way.

No, and wasn't suggesting that. I just want to make sure that was out there. As Assembly Member Papan had spoken, performance, actually, because accountability--and I can see you guys have gone very extreme into what you consider accountability and that's great to have that; I mean, we don't know if it's actually going to work--but the performance measure is something that is really important to me because, you know, you can lay this out there and you've got a lot of counties and a lot of people in charge of what's happening.

What--do you have a plan for performance in regards to what you expect to see in six months, what you expect to see in one year, and what happens if all of a sudden these performances aren't measuring up? Does that say you stop the people from being taxed or you just continue taxing them?

Because to me, we've seen this in other transportation programs and projects and so, I think, you know, making sure that you have that performance measurement, you know, every year, I think is really important, and I just, like--it's really hard for me to have to talk on a regional bill and vote on a regional bill when I know that not everybody that this will be affecting approves it. And so I guess I am a little interested in the opt-out part of that as well.

Did you want to comment?

These are heavily scrutinized agencies with very regular evaluations. I will say I'm very proud that Muni does every few years a massive survey of riders and its approval ratings among riders are the highest in almost 30 years. BART has also dramatically improved and it's really important.

I know that this is, this bill creates a district for the vote to happen, so we've been very clear with counties. The ability to opt out is during the legislative process, and San Mateo County and Santa Clara County opted in, and I will tell you this weekend, when there was some turbulence around Santa Clara--San Mateo County for which you've heard play out today, I was contacted by a whole bunch of people in San Mateo County, be like, 'we've opted in, we want to stay in.'

Okay, and one other concern I have is with Prop 13. We had Proposition 218. When it came to taxes, it was supposed to be a two-thirds vote of the people so that you really would have a majority that felt that way, but this is not a two-thirds, is that correct?

Under Supreme Court precedent, if you collect signatures, it's a majority. I personally, I like, I support majority rule and I don't think personally that 33 or 34% of people should be able to stop 66% of people from fixing problems in society. Thank you, Ms. Aguiar-Curry, for your work on that.

But just notice this is a citizen initiative, a signature. Yeah, yeah. So that's why that doesn't apply.

Thank you. Appreciate it.

Thank you, Vice Chair. All right. So, thank you, Senator Wiener and your staff as well, for all the work that's done and Senator Arreguín for your leadership and definitely to Assembly Member Papan for your advocacy.

A lot of what is in this bill and the accountability measures that have put forth so far would not be there without that. The Covid-19 pandemic has been an earthquake for the Bay Area, completely shifting the dynamic of how we get to work and how often we need to get to work.

Unlike Los Angeles, which heavily subsidizes their public transit with the sales tax measure, the Bay Area has been able to rely more heavily on a user-pay model. Those days have changed, and as we as a region have come together to make sure our world-class transit system can serve those who are dependent on it and continue to strengthen our economy by making travel around our region more seamless, BART, Caltrans, SF Muni, and AC Transit cover 80% of all transit rides in the Bay Area and 30% of all transit riders in the state.

Those four agencies combined face a deficit of over 817 million in the coming year. I appreciate the cooperative process across the region on coming together on an ex--excuse me--an expenditure plan that will help ensure the health of our transit agencies. This bill has strong accountability measures to not just shore up our transit district, but also improve their services.

This bill requires MTC to hire a third-party consultant to make recommendations on how to improve the financial health of the four largest transit agencies and provides necessary tools to help ensure those recommendations are actually followed.

In addition to the Oversight Committee that will ensure that the recommendations are adhered to, the bill also creates four Ad Hoc Adjudication Committee composed of two commissioners from each county funding the major operators under the initiative. Those committees authorize the county funding for the various transit agencies to hold them accountable for cleanliness, safety, fares, and service.

MTC is required to follow the recommendations of the ad hoc committees, which are empowered to force BART, Muni, Caltrain and AC Transit to shape up or risk up to 7% of their fundings from being withheld. Seven percent annually of the funding includes 23 million for BART, 3.5 for AC Transit, 5.25 million for Caltrain, and 11.9 million from Muni.

For the first six months of the year, all counties on the Adjudication Committee must have at least one representative agree before funds are released, and if the issue is never addressed, by the end of the measure, the money will revert back to the counties that provide funding to spend as they wish on transit operations.

This measure is an important step to ensure accountability of our tax dollars while also making sure transit agencies adhere to customer service. With that, I am happy to recommend an aye vote on this measure. I give the opportunity for the authors to close.

I think we've said it all. I respectfully ask for an aye vote.

Madam Secretary, please call the roll.

SB 63: the motion is do pass as amended. [Roll call]. Eleven to five.

That bill has 11 votes with--11 aye votes with five no votes. It passes--do pass as amended--out to the floor. With that, this meeting is adjourned.

Thank you.