Senate Transportation Subcommittee on LOSSAN Rail Corridor Resiliency

Okay. Well, good afternoon. Hello, everybody. Nice to see you. We will begin in one minute. The Senate Transportation Subcommitee onl LOSSAN Rail Corridor Resiliency. The Senate Subcommitee on LOSSAN Rail Corridor Resiliency informational hearing will now come to order. Good afternoon. We welcome the public and your participation for today's hearing.

We will hear from panelists first and then we will take public comment. So I'll invite up the first panel to come sit up here and I'll give some opening remarks as well. So when this Subcommitee last met. Welcome. Thank you for coming today.

When this Subcommitee last met in 2025, the Legislature was set to receive two critical reports. The first was led by the Transit Transformation Task Force. And it was meant to identify. Welcome. It was meant to identify statewide policy reforms as a condition of the state providing more than $5 billion in one time bridge funding.

I just want to emphasize the large amount of money, so $5 billion. And the transit Transformation Task Force was part of that. And then the second was a requirement of my legislation, SB 1098, which outlined a clear path for discussing difficult but necessary questions related to management, governance and performance of the LOSSAN rail corridor specifically.

Unfortunately, both reports fell short. In fact, the 1098 report remains unfinished. Its work has barely begun. So it may have had one meeting or it may not have had any meetings yet, but it was due at the beginning of this month. The report, and it is not, it had yet to meet at that point.

Today's hearing was intended to receive that 1098 report and to discuss policy reforms and funding needs. But instead, the corridor remains at a crossroads. We have heard repeatedly from panelists and subject matter experts that their performance and reliability of services are key to retaining and growing ridership.

Yet the reality is that on nearly every performance metric, we are falling short. Ridership on time, performance, fiscal solvency, delivering capital projects on time, delivering capital projects under budget, and much more. And we know the questions that need to be answered. So the questions have been posed.

And so how can we better align roles and responsibilities so that there is clearer accountability and higher performance for Southern California's rail system? How do we maximize the use of existing local, state and federal funding that's already committed to rail?

While ridership alone will not sustain services, a sustainable path forward must address both the fiscal solvency and facilitate a significant increase in the use of rail services. So we have to grow ridership.

Also, how do we better deliver capital projects ranging from the day to day maintenance projects that unlock improved or new services and transformative projects like electrification and needed resiliency protections against coastal hazards. How do we improve the reliability of passenger services?

Reliability is the thing that comes up again and again when people say why they don't choose to ride transit or they start, start and then they stop. The reliability of both daily operations and avoiding continued track closures that suspend services that passengers rely on.

We cannot expect passengers to continue navigating complex schedules, multiple fare products and often poorly timed connections on unreliable trains. I firmly believe in the future of rail along the LOSSAN rail corridor and also across the state.

I believe we can achieve a future that not only returns the remaining 1 million annual riders to the Losan rail corridor so we still remain 1 million riders down, but also that we can surpass previous ridership benchmarks. We've seen how transformative projects and innovative thinking can revitalize our rail services.

Now we must do the hard work that's demanded of us to make that happen. So I look forward to hearing from Calsta and Caltrans on how we are ensuring the long term success of passenger rail services in California. The Legislature needs clear and transparent information on the solvency of state funding that's used to support passenger rail services.

We must also hold ourselves accountable when we fall short on our responsibilities. I look forward to working together to ensure that responsibilities like fleet deployment, zero emission strategies and state led planning meet the high standards that are demanded of us.

I also look forward to hearing from Metrolink and Caltrain regarding the state of their systems in Southern California. We face a reality in the coming years that may include reduced levels of service on all three passenger rail operators. And I cannot overstate that. We must not let that happen.

It does seem to be staring us in the face, but we must not let that happen. I'm committed to working together on a vision for Southern California rail that brings together our operators, our state agencies and the many local and federal stakeholders to unite under a shared vision. That was the goal of 1098 and the 1098 report.

And I hope that we are still able to deliver on that. We simply cannot accept inaction. So before we turn it to the first panel, I would like to ask if Senator Archuleta would like to make any remarks.

Thank you, Madam Chair, and welcome. I know you traveled from one end of the state to the other. Thank you for being here. Obviously, the Transportation Department, the Subcommitee is very, very concerned about the future of our system and of course with the fact that we just had rains that were devastating in some parts of the state.

Of course, the safety, public safety along the route is something that's important. Maintenance along the route is important. We heard the chair mentioned ridership, which is very, very important. But we all know the sun will come out, people run to get in their cars and hopefully jump on the trains and go up and down the coast.

So we're hoping that. But we have to sustain what you do. So if the Transportation Committee doesn't have the wherewithal because the numbers aren't there, that means that the state has to jump in and subsidize. And we're hoping not to do that because of the ridership.

So I'm hoping that with your presentation that you'll bring us up to. Up to date on. On what it looks like in this year, that hopefully it looks favorable. So we're trying to work with our budget and hopefully you can all work with yours. Thank you, Madam Chair. Thank you.

Thank you. And thank you for being here, Senator Archuleta. I appreciate it. So now I'd like to introduce our panelists. We have Hunter Owens, Senior Advisor for Transit mobility data and Performance at the California State Transportation Agency. We have Kyle Graedinger, the Chief of Division of Rail at Caltrans. And we also welcome Senior Advisor Owens.

And you are welcome to begin when ready.

Thank you so much. All right. Thank you so much. Good afternoon, Chair and Members. Hunter Owens, Senior Advisor for Transit Mobility Data and Performance, appearing today on behalf of the California State Transportation Agency.

I want to thank you for the opportunity to provide an update on efforts underway to strengthen and support the LOSSAN corridor, including major investments already being advanced and the work underway to deliver the aforementioned SB 1098 report. Over the past several years, the state has made significant investments to stabilize and modernize the corridor.

Most notably, in October 2024, the state awarded $125 million in TIRCP funding for the initial emergency release resiliency work in San Clemente. This would leverage $80 million in TCEP funding and that helped secured 80. That helped secured an additional $100 million in federal CRISI funding for that project.

Just for a quick acronym check, TIRCP is the Transit and Inner City Rail Capital Program. T TSAB is the Trade Corridor Enhancement Program. And Chrissy, I will defer to my rail colleague, my colleague at the Division of Rail, Kyle, to I don't have those acronyms off the top of my head.

More broadly, we're advancing over $25 billion in funding projects that are currently preparing for construction.

These transformational projects, such as Link Us at LA Union Station, Grade separations, new bridges and Stations in San Diego county to improve surfliner and coaster services, and the new LOSSAN maintenance facilities in both San Diego and San Luis Obispo are in progress.

Since 2022 alone, this has included over $700 million in TIRCP and SB1 investments that have supported these key corridor improvements. Against that backdrop, CALSTA is also moving forward with implementation of the SB 1090 with implementation of SB 1098 with a commitment to deliver a comprehensive report that will support comprehensive report that will support long term corridor performance.

To date, our team has already completed key foundational work as required by SB 1098, including developing a baseline summary of corridor conditions, compiling a summary of resiliency projects and associated funding, documenting the current activities underway through the FRA Corridor ID process, and developing a database of planned and active capital improvement projects across the corridor.

Under the guidance of Secretary Omeshakin, we will be convening the LOSAN working group tomorrow February 19th and over the coming months we will be working closely with our corridor partners to develop the recommendations and policy direction required under SB 1098.

I want to situate this work on the broader statewide efforts that we have undertaken under the past year to strengthen transit and rail statewide, including the also aforementioned Transit Transformation Task Force Report and the Administration's recent actions to support Bay Area transit operators through an emergency loan framework.

With that, we look forward to continued engagement with the Legislature and our corridor partners and are committed to keeping the Subcommitee informed as this work advances and I will pass it over to my colleague, Kyle.

Thank you, Hunter, thank you, Chair Blakespear and Senator Archuleta. And I'm also joined today by Danny Yost, Caltrans Legislative Director. So thank you for the opportunity to provide an update to the Subcommitee on California's rail system and our work on the LOSSAN corridor.

At a recent hearing, the Committee emphasized a clear goal fast, frequent and reliable service to increase ridership. Since then, our focus has been on execution, accountability and measurable progress. Delivering on these goals begins with disciplined daily operations, standardized procedures, clear roles and ongoing performance monitoring to ensure that every operational decision supports improved service.

For Californians, Caltrans plays a central role in California's rail system. As a Department, we lead statewide rail planning, including five corridor level plans under the Corridor Identification and Development Program. We also support and oversee intercity passenger rail operations through the Joint Powers authorities or the JPAs and and Amtrak.

As their service provider, we advance service expansion and restoration, including a full return to pre pandemic service levels and restored surfliner frequencies. Caltrans also owns and oversees the state's intercity passenger rail fleet including locomotives and coaches, although Amtrak also owns a portion of the fleet used in the Surfliner service in Southern California.

We also provide unified Executive leadership for rail and transit statewide through a newly established transit and rail program structure at Caltrans and which will strengthen governance, accountability and alignment across planning, funding and operations and I'll briefly describe this in a moment as it does affect where the Division of Rail sits in the Caltrans structure.

Building on this foundation, we have completed preparatory work to enter into Step two of the Corridor Identification and Development Program for all five corridors in California, including the LOSSAN Corridor.

Step two is a multi year process to develop comprehensive service development plans which will identify service concepts and the capital projects and funding needs required to improve and expand passenger rail.

We had a meeting last week in D.C. where the federal Railroad Administration said that they intend to obligate all of the Step two grants nationwide by summer of this year to support this planning. We also have developed the California Rail Infrastructure System at Caltrans. It is a rail planning and project tracking database and an operations analysis tool.

We call it CRIS. C-R-I-S and so CRIS helps the state prioritize projects that will lead to tangible service improvements for California travelers.

We have also, as I mentioned, fulfilled our commitment to the Legislature to ensure that all three intercity rail JPAs would return to full pre pandemic service levels as of last two weeks ago the Surfliner was returned to 13 weekday round trips between Los Angeles and San Diego.

We have also worked with the LOSAN team to pilot a service expansion for Santa Barbara and San Luis Obispo, bringing six trains a day up to Santa Barbara and three trains up to San Luis Obispo, which should go into service very soon.

Restoring frequency is key to rebuilding ridership confidence and providing a service that is truly frequent and reliable and that reliable service also depends on a dependable fleet. So Caltrans in the last year has supported the Northern California JPAs in transitioning maintenance of our fleet to a new third party provider with the intent to increase availability and reliability.

We are also about to release a procurement for a life extending overhaul of the oldest locomotives in our fleet, the F59s. We hope to have that work underway before the end of this fiscal year.

We are also working with the jpas and Amtrak to scope a life extending overhaul of the bilevel coaches, including the Surfliner fleet which will put that equipment into a state of good repair to operate through the next decade and with new passenger amenities and comforts so those Actions will ensure that our state owned rail fleet continues to serve Californians until new equipment can be procured in the Late2030s.

Just last week, Caltrans released a new Director's policy on transit and announced a reorganization to elevate our support for transit rail, walking and biking. And central to this effort is the creation of a unified transit and rail program structure, providing Executive statewide leadership across all rail and transit functions.

By consolidating oversight and aligning our responsibilities, we are strengthening governance and accountability, reducing fragmentation and enhancing our ability to deliver measurable service improvements.

This alignment allows the division of rail to operate with greater integration across all modes of travel, provides clearer accountability and coordinated efforts that reflect a shared goal within the new division and within Caltrans to deliver the fast, frequent and reliable intermodal service to the people of California.

In closing, we are aligning governance, operations, fleet readiness and long term planning around a single objective. Delivering rail service that is fast, frequent and reliable and worthy of increased ridership. We look forward to sharing progress, answering questions and continuing our partnership with Legislature to improve California rail service. Thank you.

Thank you. Did you have.

I'm here to establish for questions.

Ah, okay. Okay. So I'm just going to follow up on the last point that was. That was just made, Mr. Graedinger, about your. The division of rail consolidating oversight and that I wasn't aware of that. Was that announced or was that just an internal restructuring?

So that was a restructuring that was announced last Monday. We are going to be creating a new deputy Director position for rail and transit. Currently, the division of rail as well as functions for transit and complete streets are housed within the directorate of planning and modal programs which also includes transportation planning, research and local assistance.

So now transit, rail, complete streets and transit data functions are going to move under a new deputy Director who will be present at Executive board at Caltrans and be able to elevate the needs and interests of transit and rail within the Department.

Okay, well, maybe that will help. I mean, presumably you were doing that for a reason. Yes. Did you want to say something about that?

Yeah, I think we're very. From the calsta perspective, I think we're very excited about this deputy Director position and this reorganization which as has been mentioned as part of a three legged stool of, you know, our new director's policy on transit and this new position along with that's.

That is really going to help us elevate these issues and have accountability within the organization and I think is going to be a strong start going Forward.

Okay, well, that's good. I mean, there are a couple. There was a lot of, in both of your remarks, there were a lot of recitations of positive things and money going out the door. But I really think it's important that we recognize that we're really not in a good state here.

Like, the LOSSAN corridor is really on the brink. I mean, the operators were about to have a very difficult potential problem with Metrolink and their fiscal solvency because of their partners not wanting to fully Fund them anymore.

And we're also facing, you know, we've added another train that goes from San Diego to LA in that 13th slot, but yet ridership has not actually come back. So we're actually carrying fewer people along the corridor. And then we have these big capital projects that are really critical, like in San Clemente or in Del Mar. Bless you.

And other ones that, like the SARA siding project that appear functionally dead, I mean, or these things that have spent an enormous amount of money in planning but don't seem to be on the brink of actually becoming constructed because of the way that we make decisions essentially about the corridor.

And from my perspective, the amount of state oversight and accountability that we, that we impose on the operators, you know, we have very much a live and let live kind of approach. And I'm not sure that we're delivering for the people of California like we really should be.

And I mean, a really great example of the deficiency in our planning is when we along the Capitol corridor having to reduce services. So those are state supported services and there was a lack of equipment that led to the service reductions. And I know about this from reading the news.

You know, it's like these things are, and that's not on the LOSSAN corridor, but it is state supported.

And so I'm, you know, I'm very concerned when I talk to the operators about, well, what is the plan for a zero emission future and what is the planning, the operational planning around hydrogen vehicles and where are we going to get the fuel for the hydrogen trains? And a lot of really major decisions that are being made.

You know, there are branches of are we going to invest in these things? And then deciding, you know, a different operator in the state deciding not to go that direction because they don't want to be. They don't see that as feasible. And so, you know, having a new position might help. And I'm happy to see that.

But you know, I really would like to hear more from you about the ambition of where you want to go, where you see it being possible to improve because the Transit Transformation Task Force was so underwhelming in what it came up with. Essentially very little actionable.

And the 1098 report is not even out yet, and the first meeting is tomorrow. You know, there does seem to be a perception of wheel spinning, that we're kind of.

It's a status quo situation, but we're not actually focusing on the fact that the transportation sector is the largest generator of emissions, that we have the second busiest rail corridor in the nation, that we have a hunger from people to get off the freeway and the congestion and ride the train, but it has to be reliable.

We have to negotiate with the freight so that we don't have so many unplanned backups and whatever the delays are, you know, so it just seems like it's on multiple fronts that were. We're still not quite. Yeah, and now this is my fourth year.

I'm beginning my fourth year of running this Committee and in the Legislature and not seeing a lot of difference from the first year. And so the point of having the 1098 report was to ask those involved in the corridor, what do you see as the potential future? What.

How do you think we can organize both operation, governance, funding to have a future where we deliver more for the people? And it's being run by the state. I mean, we're overseeing that 1098 report.

So the fact that we didn't manage to get it even started, let alone delivered to the Legislature on time, is really an egregious failing.

I mean, you need to know that from the author of the Bill, but also just from an outsider looking in at the comprehensive performance of the corridor and then seeing these big projects that really aren't even near getting started.

So, you know, I'd like you to respond more specifically to the challenges and not, you know, the happy talk of like, yeah, we've spent money on things in the corridor. And so there have been improvements, there have been double tracking sections. But has that actually improved ridership for people or reliability or frequency?

You know, and I'll also just mention, as long as I'm going through the litany of problems that, you know, the Santa Barbara connection, they spent two years negotiating with Metrolink and then now LOSSAN has zoomed in at the last minute and said, hey, we want to actually run this as a state supported route, and we're not going to allow Metrolink to do that.

And so then you just go right back to the beginning of the planning process. So it just wastes an enormous amount of time because we didn't really seem to be in the position where we could effectively negotiate at the beginning. So, you know, that kind of thing just, it doesn't give confidence.

So with that, you know, I'll hand it back to both of you or all three of you to address those concerns.

Yeah, I'll let my colleague touch on some of the more in detail ones with regards to Metrolink and Losan over services delivered. I think broadly speaking, I think the challenges are real and go back many decades.

I think, you know, you look at where the historic trends in terms of investment and funding have been dating back to the 1950s.

So really looking at that big long lens of history have is probably explains a lot of much more of the existing conditions today than one might want to admit that, you know, our parents and our parents parents decisions are driving sort of where the conditions on the rail network are in the US today.

You know, so compromises, you know, made in the 70s is what drives a lot of this underlying framework. And while we work through that underlying framework, that is a framework that has been set for, that was set, you know, many, many moons before.

You know, here the pandemic was in 2020. So I mean we had ridership that's fallen off a cliff and then we've, you know, are barely coming back from it. So I understand how we've moved away from transit in favor of the single use automobile.

But you know, there are, there are examples that are much more recent of us having a lot higher ridership on this corridor.

Yeah. And I think again, when it comes to the more specific sort of pandemic service recovery, we just got back two weeks ago to those round trips in the rail network, we have still not necessarily recovered on our transit in terms of actual accessibility. That is being driven by a lot of factors.

I actually think there's a lot of robust analysis in the TTTF report on what is driving, some of the underlying causes that prevents agencies from delivering fast and frequent service.

And we encourage looking at some of those principles that the TTF reports laid out to kind of look at a high level, how we can deliver a transit network that actually attracts more riders and what sort of goals and objectives we might want to optimize around.

So I would again looking into this TTF report, there's a lot of really in depth discussion of how, you know, speed and reliability issues have sort of resulted in that hemorrhaging and how we can get back. So I do think there's a lot of focus in especially the first principle of the report that drives that.

And for the specific, I will pass back over to Mr. Graetinger.

So I think in terms of frequency and adding back the 13th train, first of all, I'll mention that the LOSAN was successful in getting a FRA restoration and enhancement grant. So the operating funding for that additional train is actually coming from the feds. And I think that's a five year commitment.

So in some ways that's at, you know, no cost to the state in terms of operations. But what we've seen in the trends when we look at bringing back the level of service since the pandemic is that the ridership does tend to follow pretty much in parallel.

Yes, we are 20 to 30% below where we were for the same number of trains. But as we bring trains back, we do increase ridership commensurately.

It's too soon to tell with the frequency being re established just two weeks ago, whether that's going to continue to go in parallel or Even if that 13th train unlocks additional ridership because of the frequency that it provides. So we'll continue to monitor that and we can certainly report back on the performance of that particular train.

When you look at other states and other State Supported Services, CA IS, was the last state to return to full pre pandemic service levels. The other states that have significant inner city rail programs, most of those are back at 100 or above 100% ridership today.

So I do think frequency is a part of it and the level of service that has been provided is a part of it. There are certainly many other factors, not to mention mother Nature and the other issues we've been dealing with on this corridor.

But we can track that data and work with you to show the results of bringing service back. The other thing I wanted to mention was in terms of you mentioned the example of sericiting and just projects that seem to be sort of dead in the water for the moment. And two things on that front.

First of all, the tool that I mentioned, this CRIS tool that we've created that will bring together an expansive database. If you look at the state rail plan, which goes out to 2050, there's over $100 billion worth of projects on conventional rail alone. That doesn't count high speed rail.

And while we've worked with JPAs and commuters to develop project lists that represent the best interest of all users, in many ways it's a wish list.

It's sort of if every entity on their own could develop the projects they wanted to, that Creates a list of over $100 billion for the projects, which is going to be difficult to Fund even with a strong federal partnership.

So we've created this tool to begin to document the status of all those projects, but even more importantly, the need or the role of those projects. What does a siding here, what does a double track segment provide us in terms of an actual service outcome that can drive ridership or access for the riders in California?

So this tool has just been rolled out a few months ago. We'll be working with the other rail partners to make sure that we're populating it with the correct information.

But we can take those projects, we can then put that, put in a service model and say, look at the service plan that combines the inner city services, the commuters. So in this corridor, for example, we'll look at what does NCTD want to achieve, what does Metrolink want to achieve, what does Surfliner want to achieve?

And we then have service planning tool tied to that they can analyze. Well, is that siting actually necessary to deliver a joint service plan? It's early days, but we have the tool and the processing ability now to begin to have conversations with the partners. Partners and say, let's look at that $100 billion of the projects.

Do we need $100 billion of the projects? Do we need $50 billion of the projects? And within those 50 billion, what are the most important projects? To group together and deliver together to provide a step function increase in service. And so that's a new capability that we have. We've been wanting to get to that forever.

And that's something we're rolling out. And that will also be very helpful in supporting the corridor ID efforts, the service development plans that are going to be begun hopefully later this year, if FRA can remain true to its word. Because the goal of the corridor ID program is to look at the 10 to 15 year time frame.

What is the service vision and what are the necessary capital projects.

So I think we've been looking, you know, with the new rail plan that came out in 2018, it was updated in 2024, the last 10 years of rail in California, we've really benefited from the largesse of the Legislature and, and the GGRF program, we've had a lot of money, but we haven't had a chance to really step back, take a look at the individual project and service wishes and lay them together and say, what is the best way to achieve these improvements for the travelers and to do them in a deliverable way at a lower cost.

Than that $100 billion vision. So that's again, more to come. But that tool is now up and running and we're going to be working on processes over the coming year to work with our rail partners and put the tool to work.

Well, I appreciate that. I mean, I think that's desperately needed. You know, there is, because the agencies, I mean, by design have a very parochial interest and the board Members who sit on there, you know, don't want disruptions that might cause any type of problems, of course, for their locals and they don't really, really want conflict.

So it drives towards spending enormous amounts of money on projects that are really not delivering anything. I mean, maybe at some point when the whole corridor is double tracked, you would need to be doing these individual segments. But you know, straightening out like an S curve in Rose Creek Canyon is not.

That's not, if that's a seven minute shaving off of a trip that's, that's going to take three hours. It's like there's nobody who's going to take the train because of that for versus not take it. Right.

But if there, if you can move, if you could get on time, performance above 90% and you can actually, you know, deliver people with enough frequency that they feel like if they miss the train, there's another train that they could get. You know, these are the types of things that do actually drive decisions about taking it.

So, and I'll just say that, you know, the, in the Del Mar area in the state budget was $300 million to do environmental and design for the tunnel project through Del Mar.

And you know, I don't know the current state of it or how much of that money has been spent, but I know that it does not appear that that project is close to being built. And the analysis up front of is this project needed? Is there a protect in place that doesn't require a tunnel?

If the tunnel is needed, how do we get ourselves on the critical path to build it so that decision making is it can move forward in an orderly process, but that we don't waste just enormous amounts of money and time on things that aren't delivering higher performance and really aren't helping anyone?

You know, just kind of creating tumult, basically. So, and you know, one of the points of the Transit Transformation Task Force that And also the 1098 report is that asking those who are closest to the problem whether there's a governance change. I mean, we devolve local decision making into local processes.

When we created the LOSSAN corridor as a managing agency and then, you know, we have these other operators along there. But what is the ideal state role?

I mean, because when there are decisions that are made, like for example, not to have transit service to the Rose Parade, which has tens of thousands of people who go to it, and it's a once a year, you know, January 1st event, and you should have special service where that happens for that event and who makes that decision.

And how are we allowing for trips that people are hungry for that are taking place in a clear, expected way? Like, we know that that's about to be a big, big event and we have these kinds of concerts and sporting events and things all over.

And are we being clear eyed about where can transit actually work the best? If it's not going to be the commuter, because the commuter to work has changed their work patterns, then there's still a rail line there that people want to take.

And I hear this in my district all the time of someone who's in Orange County who says, I want to go to the Padres game, but I can't take the train across the county line because it's an arbitrary line where people, you know, where the service doesn't run across the line. So, you know, there are.

So getting focused on what are the capital projects that are most important and having a system for evaluating them. I think that is really important. And I hope that you stick to that. You know, that you.

Because there are hard decisions and there's prioritizing and it's really the case with every amount of state money in any project is how do we prioritize to actually solve problems? Not just to turn our wheels, but to solve problems. So I'll turn it to Senator Archuleta.

Yeah, I'd like to point out what a great presentation.

Put you in the hot seat, you're there. But if we can't get you, the professionals who are hands on, who can we get? But I think like any problem that we have, it goes with the beneral public. What is the perception?

The perception should always be riding a train is on time and safe, right in Los Angeles there with the train situation we have there, the Olympics coming, ridership is an issue, but public safety is a big issue, right? So we've had the LA County Sheriff, we've had special sheriff's security and on and on and on.

But when you have a beautiful route that takes you up in through Orange County and San Diego, and my question basically is, are you promoting, do you actually have a priority?

I mean, I would really be excited if you told me we took high school kids or junior high school kids up and down a certain route so they could see it be part of it.

And then next week some of the college kids and just get the General public involved because it's such a beautiful route and it's vital to California. That's why we're excited about having you funded and having you provide the service.

But if the general public doesn't know it's there and the next generation of kids that are going to go to college and on, they're going to be the ones that are looking for public transportation. The older population, they don't want to get other cars, I understand, but the new ones, but it's all public relations.

So my question to you, do you have such a Department and are you willing to step that up?

Yeah, I can touch on broadly so one and I know we have CEO Darren Kettle here will I think touch on it in his presentation.

But one thing the state has funded that has been extraordinarily successful for the Metrolink system has been the Student Adventure Pass, which had started at a free and is now at a 50% discount and is performing well.

I will let the CEO give you the direct numbers because I don't want to get them wrong, but that has been enormously successful in helping get younger folks onto Metrolink from both A the raw numbers look great, but also just anecdotally letting folks in the Southland really be able to see their friends, their family, people distribute.

There are a ton of really great colleges and universities across the entire Southland and thankfully Metrolink connects a lot of them. There's going to be some detail in your upcoming presentation, so I don't want to steal that too long.

I also know that within the annual business plans and I'll let Kyle touch on this with a bit more detail. We do find a pretty significant chunk, especially for the inner city routes.

That is a thing you really do want to market as, you know, getaway for the weekend to Santa Barbara, you know, go down and see a game.

And so I know we've taken not just traditional marketing efforts, but also some innovative new ones, like working directly with influencers, which is, you know, not necessarily my area of expertise, but we are seeing results from and, you know, a really strong performance and change in the net promoter scores, which is how we.

You know, the old saying, it takes money to make money, but it takes promotion to bring in people who spend the money. And that's why it's so vital. You have to see it as an investment. And I think that's. That's so important.

The summer will be here before you know it, and that's a peak time, I would think. But it's just so. I can't emphasize enough how much public relations is so important. The reason I do that, in my own city, we opened up a beautiful theater and nobody was going there because nobody knew it was there.

And so we allocated funding for it, PR. We brought kids in there, and next thing you know, now it's thriving because it became a hub of the city, but it was public relations that did it. And one restaurant that was right next door, we invested $300,000 in renovating that restaurant in a business partnership.

We with the proprietor was paid back to the city, but that also went. And then we had others. So it's just bringing everybody together that, you know, it's so vital that you do this.

Thank you. It's a great question and great ideas. And I would just add, one of the reasons why the joint powers authorities were created for inner city passenger rail was to amplify the local voice. And specifically, one of their charges is to do the promotion and advertising for the corridor and really do that from a local level.

And in fact, I'd say the Losan agency has been a really successful model, looking at other corridors around the country that are well known for doing a good job branding and promoting their services. Losan is really up there top notch with the rest of the country.

But of course, Caltrans wants to support that as well and get the word out to travelers that this opportunity exists. And so we've been taking advantage of opportunities to amplify the message that the JPAs have been creating. We've been using social media. You had a great Senator Blakesbird at the last meeting.

The idea of using the changeable message signs on the highway infrastructure where the vast majority of travelers are get their eyeballs to see that message. And so we've been working on opportunities to use the CMS systems.

And then I think another really critical program that we've been working on at CalSTR and CalTrans is the California Integrated Travel Program.

You know, when you, I don't want to speak for you, Senator, but I imagine when you plan a trip, you may look at Google Maps on your phone and that will tell you the best way to drive from A to B.

They have that function in there in the phone to be able to tell you how to get there on transit as well.

But we have to make sure that transit and rail are seen, that we're providing, that the agencies are providing travel information that is being ingested by Google and Apple Maps and then being put out on your phone and on every Californian's phone who has a smartphone and saying, look, there's an option to get there that doesn't involve a car.

So those are some of the ways we can amplify that messaging as well. And that's important to.

And you need to boast about your success. Public safety on and safety on the trains on time. I mean, if those are issues that are so pertinent to people, then boast about it. Get it out there in the airwave. So everybody knows that, hey, that's the way to go.

And instead of driving to San Diego, hey, get on the train, enjoy yourself going to the track, going to Santa Barbara. It just goes on and on. And I know that we put a Committee together.

I don't know if I mentioned this, Madam Chair, but we had about 50 people in started off in Norwalk and we all jumped on the train and we went to Anaheim to see the rail system there and the hub that they're building there and everything else. And everybody was just so impressed.

And now I thought to myself, wouldn't every city council Member all along the route, up and down, had a chance to ride the system so they can to boast about and disseminate what they've just seen. The public safety that's there, the reliability, the cleanliness of the trains, everything. And with that comes the public outcry.

Keep our trains rolling. Keep our trains in our towns. That's what we want to hear because we're fighting for you, but we need you to go ahead and fight yourselves. So, you know, I can't emphasize enough that point, Madam Chair, so let's work on that, gentlemen.

Yeah, I mean, and I'm going to move to one of your favorite topics, hydrogen, in a second. But I want to jump off of what you were saying about public safety that I was heartened to recently do a tour with NCTD and the CEO in Oceanside.

And basically they have a re energized approach to managing public safety and cleanliness at the station. So they have now not just people walking around as volunteers to help out, but they're wearing a vest so they look official and they're helping people.

And they're also interacting with people who maybe don't have any other purpose besides just to hang out, like homeless folks and stuff, to try to move them along to a different place to be so that our transit stops aren't places that people feel unsafe or unwelcome.

And I think that's really important, you know, to take have a sense of pride and ownership of our transit. Both the trains themselves and there are people in security outfits or vests who are riding the train and making sure that other people it's visible, they see and feel safe.

The other thing they mentioned is that they're no longer wrapping the trains in advertising. And he said, you know, this is, it's kind of like a police car. You don't wrap it in advertising. You boast about the fact that you're the police Department.

And I think that's, you know, the trains have these beautiful views and when you put the advertising on it, you can barely see out the window anymore. It's like, you know, all these little tiny holes.

And so having it be just nice and clean inside and outside and not wrapped in advertising, I think that all that is a good direction to go and does show a sense of pride in our transit. But I wanted to ask specifically about what is the overall strategy around moving to a zero emission train situation?

Because the operators seem very concerned about the way that the hydrogen trains are being rolled out and that it's not fitting together basically. So what is the thought process and what are you doing about that?

I can mention talk about that for a moment. So we are in the process of procuring 10 hydrogen fuel cell called multiple unit trains. This is not a locomotive. It's like a light rail vehicle or subway train. So the power is built into the train itself.

We procured these trains because we were looking out at, especially when CARB had the locomotive regulation that was looking to a zero emission or diesel phase out on the rail network. By I think the mid-2030s, we were trying to be very proactive and see how quickly can we get to zero emissions.

We agree we would love to see electrification everywhere, but that is absolutely not feasible in the short term. Caltrain has had a wonderful success and high speed rail will require electrification due to its speed and requirements.

But the vast majority of the trains that operate in the state of California are operating on privately owned freight railroads and they have strict requirements not to have electrification. We've had positive conversations with the freight railroads about opportunities in the future.

And I know that the Energy Commission, CARB and others are working with the research sector and having conversations about what the opportunities may be to electrify privately owned infrastructure in the future. And we will continue to follow that and support that. And ultimately that is the state of the art electrification, if you can achieve that.

But in the near term, what we are working on is we are looking at what are the technological opportunities today to provide zero emission trains. And hydrogen is the first technology we've been pursuing because we believe it is the best fit for inter regional intercity trains.

Battery trains do not have the capability to operate longer than about 150 miles. At that point you get to questions of physics, weight versus distance that cannot be overcome.

But we are also supporting projects such as when you may hear about today from Caltrain, where they are looking at purchasing a battery and overhead electric train set for their service to give them zero emission operations south of San Jose to Gilroy.

We are following that closely and we hope that that can also unlock the door to Assembly Speaker Rivas district with service to Salinas in the near future.

But right now looking at battery and hydrogen as the two main technologies that are reasonable and foreseeable on the network in California, we've made the move so far with hydrogen because that's the only product that gives us the distance and the range that is necessary to operate longer distance services in California.

I mean, what about the fuel source? Because that has been reported as being enormously expensive.

We've been working with the Governor's Office of Business and Economic Development and other entities in California with Members of the Hydrogen Hub when the DOE was still operating that program last year. But GO-Biz continues to support us and they are also working on developing green hydrogen production in California.

There is green hydrogen production in the Southwest in Arizona. And we are working to try to bring green hydrogen production into the state of California. We've had conversations with some of the potential vendors about how they would produce that.

And essentially what they need is they need to see that market sign our Trains are going to consume a good amount of hydrogen, but they need more than just us.

I think it's a good omen that many of the transit agencies, even some of those who were all in on battery buses in the 2010s, several of those have also realized the operational limitations of battery and are now moving toward fuel cell buses.

And so with over 100 fuel cell buses in the state today, and more to come, I think there's a really great opportunity for rail and transit operators to be the drivers of that demand for zero emission hydrogen fuel.

I don't want to speak for those private companies or for GO-Biz, but we are hearing promising things that they are going to be able to stand up production in California in a timeframe that's in line with the time we will be rolling out our first hydrogen trains.

So we hope that we'll be able to start with green hydrogen and that we can procure it at a price that is in line with what our projections were when we first started looking at it, around 2020. And the goal was to get to price parity with diesel within a decade.

At that time, I think we're still looking at the. What I've heard lately is under $10 per kg, which is equivalent to a gallon of diesel fuel within this decade. So it's not quite the same as diesel, but. But it's getting close. And again, all of this is commitments from the private sector.

And so I can't say I can't speak for them, but the conversations we've had are promising that they are still interested in this space.

Yes, yes. Yeah, you're absolutely right. You're very well informed. I just had a meeting a few minutes ago before we started on hydrogen, the fuel cell batteries that you mentioned, the buses, Foothill Transit just ordered 40 buses. 40 fuel cell. Why?

They've compared theirs with the electric and in some of the hillsides there, in some of the areas that they service, the electric buses just couldn't handle it. Fuel cell batteries right up the top, it's more efficient and so on. But the issue, you're absolutely right, is the production and the delivery. But they're working on that.

As you know, the hub that we're all hoping for because of Archers didn't happen because of the federal funding that didn't come. So now we're looking for business, private enterprises that will work together to offset that. So it's still in the future.

And when I spent two visits in Japan and their fuel cell, fuel cell battery trains were efficient clean and, and cost effective because they do not have oil wells in Japan. So they have alternative. Right. So. And they run their trains pretty well.

So I'm hoping that we continue looking in that direction and we'll support you all we can because I believe in it. And as chair of the Select Committee on Hydrogen, I'm going to keep pushing as chair has mentioned, but we've got to find all sorts of resources we can for the environment.

You just can't in the next 20 years be running trains that are causing issues in the environment. And fuel cell batteries is one and your efficiency is the other. And we're going to partner up on this thing. So stay tuned. We're coming at you. All right.

Yeah, thank you. Yeah, I mean I just encourage continued serious focus on operationalizing this because it does, it seems like there are a lot of friction points and they're not, the details are just not worked out.

So to the extent you're able to have a big, bigger vision and have it be supported and not have it be half baked, you know, that's really what we're going for as a state and that I encourage you. Okay.

And then my last question before we move on to the next panel is can you just talk a little bit about the status of the state led planning in San Clemente? So you know, there's a track that's at risk and it's at risk from the hillside falling on top of it and the ocean crashing over it.

And you know, the state needs to lead that long term there. So what is actually happening?

Yeah, thank you for the question. Really appreciate the opportunity to talk about that. We recognize the importance of that long term study. We also recognize the remarks that the chair made earlier on the need to deliver a financeable and buildable and well scoped project.

So we are currently working with our local partners in OCTA in the region to get started on that long term study with a goal of delivering it on time in line with the expectations from this Committee, expectations from the Coastal Commission and others.

But we do want to sort of align on a scope, but we do have the resources identified and are going to get that underway likely in the next, within the next, on time for the Coastal Commission stuff. So within the next year we'll be underway and I think we'll be delivering a strong process.

And so you're saying deliver on time. So what, what is the, is it an internal on time or?

The Coastal Commission requirements on this and I will get you the exact date are Sometime in the 2030s we have to have it completed and identified what is in the early 2000 and 30s, and we'll provide the exact date at a later juncture, because I don't have that off.

The top of my head, but I thought the planning, I mean, that's the actual project needs to be in the2030s, not the planning. The Coastal Commission wasn't saying you need to do planning because there are two.

Expectations and two dates, one of which is an early completion of a plan and agreement on what to do with the alignment. And then longer term, looking at a secondary process for realignment.

Right. Okay.

Conditions of the early emergency work permit.

Okay, so to the question of, like, what is the status? Is that you're currently speaking with OCTA and trying to come up with the beginning of the scoping of a study? Is that what it is?

We're aligning on scope? Yes.

Okay. Do you want to say any more about that, what the scope would be?

I think it's a little premature, but we do look forward to keeping your office and all other stakeholders informed once we are able to.

Okay. Okay. Okay, great. Well, anything else? Okay, well, thank you so much. We appreciate your time and expertise. Good luck as you can carry on with this. And we look forward to the 1098 report as soon as it can get itself finished. Okay, so now we have our second panel discussion.

First we have Darren Kettle, chief Executive officer at Metrolink, who will be joining us. Virtually, Metrolink operates the regional rail service along the LOSSAN rail corridor between Ventura and Oceanside. And we also have Jason Baker, government and community affairs Director at Caltrain. Welcome. Caltrain operates the regional rail service between San Francisco and Gilroy.

So thank you both for being here. And we'll go ahead and start with Mr. Kettle if he is on. Oh, there he is. Great. Nice screensaver.

Thank you, Madam Chair. Give me one second. I'm going to try to make sure that my technology works here. So hopefully you should see my slide deck at this point here shortly. And I'll click on this.

All right, well, do we have, do you have audio and video on your end, Madam Chair?

We do. It all looks like it's functioning completely as expected.

Okay. All right. I will never be confused as an IT expert, so. Well, thank you, Madam Chair, for, for inviting us to be a part of today's conversation. And I'm going to do a quick update on what's happening at Metrolink.

I was able to listen in on the prior panel and we, we do have, we have plenty to share and we have plenty of challenges. So I'm going to launch right into it, just for purposes of familiarity. This is the Metrolink system. We serve six counties. We have 77 total lines, 545 miles.

The, the 545 miles makes us the third largest passenger rail system in the United States. And so we serve a massive population. Nearly half the state's population, or just about half the state's population, has access to Metrolink service.

67 stations, 164 trains, which is about a 25% increase from where we were a couple of years ago when we did some, a lot of work to see how we come back after the pandemic and recognize that the world changed in March of 2020 and we have needed to make changes to recognize that.

Then we operate on the very eastern end of our region. A 9 mile segment of what was referenced earlier, multiple unit train between San Bernardino and Redlands. That's what we call the Aero service light rail on steroids.

What I'll bring to the attention, of course, of the Committee is that several of these lines operate on the LOSSAN corridor and by color. The yellow, which is the Ventura county line, extends all the way to Ventura.

The orange line goes from LA to Oceanside, but we also have a line that goes from San Bernardino to also to Oceanside, known as the Inland Empire Orange County Line. So through three lines that in some way shape or form touch the LOSSAN corridor.

And of course, you're all familiar with Pacific Surfliner or Losan, which is the gray line on this map that operates from San Diego all the way to San Luis Obispo. What may be not as familiar is the nature of our structure.

We are made up of five transportation agencies in Southern California with LA Metro, octa, Ventura County, San Bernardino county and Riverside counties. Transportation. Our voting structure tracks with our governance structure tracks with elected officials, typically elected officials from those five counties that come together to make up the Metrolink board.

We have primary Members and then we have alternate Members, although we treat the alternates as if they were primary, with the exception of. So they participate in every meeting that we have, whether it be a Committee or a board meeting.

So we're going to touch a little bit on ridership and some of the things that we've needed to do in the last few years.

As we, as I mentioned In March of 2020, the world changed and ridership on commuter railroads across the country changed, I would say not just across the country, but throughout the world, but in the United States we saw a huge drop, a significant drop in ridership, of course, because people were not going to offices.

So the commute fundamentally changed. And with the exception of essential service workers, everybody was working from home for a number of years and we're only now starting to see some recovery. But what we've learned also in the same period of time is that that there is fundamental change in how our workforce does work, particularly professionals.

Essential service workers generally have the same kind of schedule, but professionals, white collar professionals, that used to be our bread and butter, buying monthly passes every month that we could count on, as I'll call it, easy money. We knew it was going to be there has fundamentally changed.

And because that we knew we had to change as well and, and we've started to see the creep in our ridership going up as we've made some adjustments in our schedule. I think Mr. Owens sort of teed this one up for us. What we've seen a big change in is our student ridership program.

A couple years ago we did use a Low Carbon Transit Operations Program grant, LC Top. We used that grant to support students, all students in Southern California with free rides. It was a tremendous success, such a success that it went all the way. We exhausted the grant and unfortunately nothing is free.

We were able to use that grant to support our operations as we tried to grow back. But what this slide shows you is what we are seeing in the way of students in just the last year of how the students are growing with their mobile accounts, how students are utilizing the system we have.

What I did not mention in my introduction, Madam Chair, is that I do live in Ventura County. I live in Camarillo and I regularly ride the Ventura County Line train. I'm in today. Today I'm in our LA office and I was on the train this morning at 6:08 out of Camarillo and got into Union Station around 7:30.

And I regularly see students not on that train because it's a little early for students, but I did see students on. I see students regularly on my afternoon train and we're seeing that and it was important that we really push this as an opportunity because it is the next generation of transit riders.

This is how we compare to other railroads across the country that are like ours. Generally we have been referred to as commuter rail. That is no longer a statement we choose to use or a title we choose to use.

We call ourselves regional Passenger rail because we're more than just about the commuter students get to school, but students use our service for a lot of other purposes. Where we've seen some of our greatest growth in ridership is on weekends and in off peak periods. And I think weekends are probably discretionary trips.

People that want to do something take the train to activities events. And we have heard that as we've done onboard surveys how they're using our trains differently than we saw them using it five years ago. We're also seeing a growth in off peak.

And the off peak we believe is because again the workforce has changed where they are.

The classic 8 to 5 is changing a bit and we're seeing people commute what we'll say classic commuters who you would go from 8 to 5 are now 8 to 2 and then catching a midday train back to their destination location and are using the train differently.

What this slide shows though is that all of us as regional passenger rail systems as we've changed our business model from a commuter focus to an all day service focus so that we're supporting both commuters because they are still critically important to us, they do pay the biggest part of our bills as it relates to our fares.

We have seen that we have all leveled out at this point where we here are at the end of 2025. So we had a nice growth across the system. And this includes the abbreviations you may not be familiar with.

So very quickly this includes Boston area, New York area, New Jersey, Philadelphia, Virginia near the Washington D.C. area, Metra is in Chicago. And of course there's some familiarity with the bottom three. Nctd, running the coaster, Caltrain and then ourselves scrra. So you can see where we all are in, in our system.

So one of the things that we did a year and a half, little over a year and a half ago now was we we launched a new schedule that optimized our service. It changed fundamentally changed the way we did business.

Again moving away from a focus on commuters to an all day service and we call it Metrolink reimagined. It took what was on the left of this screen as really focused on the rush hour, peak times and one way trips to a transition to more all day service, what's called a pulsed schedule.

And I'm going to describe that in a second. I don't have a slide for it, but there are a variety of things that we've done to try to capture new riders.

The nature of our old schedule was again very peak focused and we've now shifted to having what we call more of a intuitive schedule on most of our system where a train is going to come in and out of the location almost always at the same time, every hour or every two hours, whereas before we were all over, we were all over the clock face.

What this has done is it's allowed us to have. And I heard, Madam Chair, one of the questions that you raised early in your introductory comments was better connections. And we actually took that to heart as we were looking at this schedule modification. So now on our, on our system, what will happen?

And here's my example is, you know, again, I catch that train on the Ventura county line, it arrives at LA Union station at 7:30 in the morning and then there is a 7:40 departure on the Orange County Line.

So someone can take a train from Ventura county or on the Ventura county line, have a 10 minute transfer and be able to make that connection. That is important for obviously workforce, but anybody using it for discretionary purposes. But what I experienced myself was a student who happens to live in Moorpark in Ventura county.

And he actually caught me on the train one day and he said, are you Darren Kettle? Are you the CEO? And I responded, yes, I am a little bit nervous. But what he said then was, I live in Moorpark, I'm a student UC Irvine.

If I did not have your service three days a week I catch my train in Moorpark, do the quick transfer at Lausanne and then I get to Irvine and I make that return trip that same day. So we have been intentional in how we've gone about that and it is helping us grow our service to broader markets.

So we're excited about what this has done. The challenge of course though is it has only been in place for about a year and a half and we had some bugs we had to work out because what looks good on a model doesn't always work in real, in the real world environment, in an operating environment.

So we had to make some tweaks, but we've only been operating it for a year and a half and we are now having to have a conversation about, well, are we going to be able to sustain this due to some of the budget challenges? So there's my segue into financial stability on the left side.

And as has been talked about, Mr. Gradinger and Mr. Owens talked about capital investment. And the state has done a very, very good job in investing in capital. Metrolink has been a beneficiary of that with our SCORE program, our State of Good Repair program.

The IJA or the Bipartisan Infrastructure Law was tremendously helpful and it's helped keep us afloat on the capital side. And while we could always build and have more capacity, that's great.

But if you don't have operating dollars to actually do it and operate on it, then there's a question of what's our fiduciary responsibility of investing capital if we're not going to make the commensurate investments in operating funds. So the slide on the pie chart on the left is our operating funds for FY25.

And you can see that our Member agencies, the five counties that I referenced before, COVID 72% of our operating budget. Fares are only around 11% or so. And you can see the other grants. Well, the next slide is going to talk about what this means and how it's different.

You'll see at FY 2019, we had Member agency support of about 51% of our operating budget. We had nearly 33% of our operating budget was covered from fares. Not a big surprise given the nature of the commuters that people were buying a monthly pass. And again, they were helping support our system.

We have not had a fare increase at Metrolinx since 2015. Whereas our, our railroads, our partner railroads, peer railroads across the country have, have, have gone to fare increases. We've not done that yet. But we're probably at a point where we have to start having serious conversations about it.

Where we are in FY25 is you can see we the pie chart. The charts are slightly different because we have to, we calculate the dollars a little bit different, but again 75. 3/4 of our operating costs are now coming from our Member agencies and fares are covering somewhere on that order of about 11%.

So that is not sustainable in our system.

Our Member agencies, the five counties, when they pass their sales tax measures for transportation and the 20 teens and 20 really the 2000 and tens period, no one envisioned the world we are in today and, and so they simply do not have the sales tax revenues, the measure sales tax revenues to continue to support us at this level.

And that's what's driven some seriously hard conversations and why we've been placed on notice about on what level of Member Agency support we can expect going forward by one agency already in writing. But I believe that we are not done yet.

There is going to be more because of the fact that the world has so fundamentally changed now what that means. If you'll forgive my slide here and Thelma and Louise, but we are at this fiscal cliff and we've heard a lot about fiscal cliff from the Bay Area. My colleague from caltrain may reference what's happening.

They are looking at a bridge loan themselves from the state that has been tentatively signed off on that will be paid back hopefully From a regional 5 county sales tax measure to support public transit. Those conversations aren't taking place at this point in Southern California.

So at Metrolink where we are completely reliant on others revenues virtually completely required on their rely on their revenues, we don't have what is being looked at in the Bay Area. So we're trying to do some of our own things. We have had a, we have modified a fair a fare product system.

We launched a fare pilot in July of 2025. I will not go into all the details here. You can see that one of the things that we tried to do was simplify the system.

We also tried to align monthly passes that had historically been based on a sort of break even point if commuters used it four days a week. Well again in many cases white collar workers, professionals are not commuting four days a week.

So we've modified our monthly pass to recognize sort of the new, the new environment which is three days a week. Oftentimes people are using the transit and using our system. So we've modified that and we have seen results from it. We, We've seen a 25% increase in monthly pass sales.

We've seen a 27% increase in average revenue per trip. But again we are only at this 0.7 months into our fare pilot. I think in most cases when we finally do the final analysis, we will look at many of the pilot fare opportunities will likely go into effect.

We may have to have a conversation about fare increases. And one of the real success stories has been the fact that we have the new day pass that allows right now, currently it's for $15 somebody can board a train and go anywhere they want in the system and take as many rides as they would like.

And it has been a wonderful success. So we are leaning in working hard to try to address new opportunities to grow ridership and then this. I think we're going to be close to the last slide. Madam Chair. There's been a discussion of Reliability.

There are three things that are critical to a person who uses public transit and certainly on our trains. That needs to be safe, it needs to be clean and it needs to be reliable. And some of the reliable elements are things that we can control.

And those two are the column on the right of this maintenance of our equipment and our operations contractor. So our fleet is 40 of them are tier 4 cleanest burning diesel locomotives in the world. And we operate on renewable diesel, so non fossil fuel. And so they're very clean burning for diesel.

But the F125 fleet is, is had its challenges. It's more costly to maintain. I'll call it high performance. And when you have high performance, you have also higher maintenance costs. And we have issues where the equipment breaks down and requires more work on the part of our mechanical team.

And then again our new contractor who's doing train operations and mechanical, we had out of the summer that started on July 1st of all this FY25, they're finding their, they're finding their stride. We had three months of some, some trouble, but we're, we're getting much better on that. So those are the things we can control.

But a lot of the, the elements related to reliability and on time performance are things that are out of our control. As was alluded to by the earlier panel, we operate on, on a number of freight railroads. The BNSF railroad we operate from Los Angeles to Fullerton is all on BNSF owned and dispatched right of way.

And then if you continue east from Fullerton towards Riverside, that is also BNSF territory. So if they put a freight train that's going 30 miles an hour in front of one of our trains that can do 79.

You can imagine how we run into some reliability issues or freight trains will break down and create congestion on the tracks. We also have had to wrestle with significant amounts of vandalism on both the Metrolink system as well as the freight railroads. And when I say vandalism, it's copper wire theft that has become rampant.

And you take a signal box down. With our system, we will lose several hours in a day. And that pretty much blows. A morning program or an afternoon program, major issue. And then trespasser strikes. We operate on an open system. We do throughout Southern California.

Whether you're on our system, Surf Liner and CTD and the two freight railroads. So there it's, it's very accessible. I mentioned my R545 route miles. Fencing 500 or hardening 545 miles of corridor is not something that is Financially doable. And so we end up with strikes. Our strikes went up in 2025, but that is.

But not to get too specific, but we also started operating a lot more trained, and so up went some of our strikes as well. So that is the question as it relates to our reliability. But we are in just the months of January and February. Metrolink has a goal of being at 95% SCRRA responsible.

We control it, and we are right around hovering around, right around 94% in these first two months. So we're making great progress working with our contractor to deliver on that. Madam Chair, that concludes my slide deck.

I'm going to stop sharing here and I will turn it back to you and I'll be prepared for questions at the appropriate time. Thank you, Madam Chair.

Okay. Well, thank you, Mr. Kettle. We really appreciate the presentation and the slides. We're going to go to Mr. Baker from Caltrain, and then if there are questions for you, we'll come back to you. So go ahead, Mr. Baker.

Thank you. I'm going to see if I can get the slide deck up. I don't know if Steph has it or if I should work on. There we go. Look at that down here, at least. Ah. All right. Two for two, sort of.

So thank you, Madam Chair and Senator Charletta, for having caltrain at this valuable conversation and inviting us here today. I am again, Jason Baker, Director of Government Relations and Community affairs for CalTrain. I want to start with just a reminder of who we are. We run Caltrain runs from San Francisco to Gilroy.

It's 77 miles of track, end to end. We run through three counties and 31 stations. We're fortunate to own much of our right of way. And so we're now running electrified service on our owned right of way from San Francisco to San Jose, which is about 51 miles of our total track.

And then that southern track between San Jose to Gilroy is owned by Union Pacific Railroad. And we have some trackage rights. And that segment has not been electrified because it is owned by Union Pacific. And we couldn't come to an agreement about electrifying that portion of our track. Here, briefly, are our core values.

You see, safety first and always is chief among those. My GM wears a bracelet that says safety first and always. We finished our electrification project just over a year ago. We launched electric service along our main line starting in September 2024. And it's an understatement to say it took a substantial investment.

It was a combination of local, state and federal funding partners to the tune of over $2.4 billion to complete this project. It took eight years in planning and construction, and we were very fortunate that we owned the right of way, like I say, giving us much more control over the process.

Caltrain's project benefited from over $700 million in state bookend funding from the California High Speed Rail project that was part of the SB 1029 in 2012 to provide direct regional connectivity to the System and over $360 million in TIRSIP funding, the transit and intercity rail capital funding from the state's cap and trade program.

And we are internally grateful for the state's investment in that. The pandemic and the rise of remote work hit our ridership hard, for sure. But we've been working hard as well to bring ridership back, and electrification has been the centerpiece of our success.

We were recently named the fastest growing railroad in our class by the American Public Transportation Association. Ridership 's up 57% year over year since we launched new electric service, and that puts us at about 60% of our pre pandemic ridership. And pre pandemic was that our ridership was at a historic high.

And that's after just a little more than a year of electric service. Our weekday ridership is way up and the weekends are now well above pre pandemic ridership. Folks are going to events on the train more and we're certainly marketing those with campaigns like Go caltrain, Go Giants. And it really is a great story.

On the ridership side, given where we. Were. The ridership growth didn't happen in a vacuum. So I want to take a moment and slow down and talk about why. Because it's important. First, and probably by far the most important, is the performance of our trains.

With electrification, we're able to increase train frequency because the trains can stop and get up to speed much faster and more efficiently than our older diesel trains. This can save minutes per trip, and shorter trip times make scheduling more trains more feasible. For a Caltrain, a system with essentially only one line, this is a key difference.

We can run the trains closer together and give people a better service for only marginally increased cost. For instance, the performance of the trains allowed us to increase peak service with little incremental cost because the same train sets and crews can cover more runs.

For example, our express train stayed at an hour duration, but went from making six or seven stops in that hour to 11 stops so more people at more stations could take advantage of our express trains. We were able to double our weekend service and we doubled our peak service to 15 minute intervals at key stations.

And the baseline service all day, seven days a week is half hour hourly service. So when you show up at a train station any day of the week, seven days a week, you're getting the next train is on average going to come 15 minutes from then.

You get a bagel, you hop on a train, you go, and if you miss it, it's not the end of the world. Another train is going to come in a half an hour or more of its peak. And all that was largely due to the performance of the trains. Just what the trains can do.

And it's been a game changer. And riders have really reacted to that more frequent service. We also introduced WI FI on board. There are outlets at every seat, changing tables in the bathrooms and those customer amenities in addition to the frequent service have made a difference.

Like other agencies have been discussing, we've also been rethinking our pass programs. Our Go Pass program, which is for companies and large institutions. Before the pandemic required institutions to buy a pass for all of their employees. And now because of remote work, we're rethinking that.

Working with companies and institutions to right size rather than having a one size fits all model. We also have a donation program where companies donate unused passes back to us and then we give them to low income workers and community service organizations. And that's been a really successful program in helping broaden our ridership and diversify our ridership.

We do have youth fairs. It's a dollar one way and two dollar all day passes for youth. And you go on our website, you can see a little green slime themed marketing piece for those youth youth fairs. I don't like it because I'm too old to like green slime, but apparently it gets the youth going there.

We've had four times the youth ridership growth and we do that both to get the next generation of riders onto transit, but also because we think that their parents and their guardians will come to and pay full fare and get used to seeing what it's like to use transportation.

Suffice it to say the results of our new schedule combined with better customer experience and that WI Fi and the train amenities have been very gratifying. We do think what we're doing and we've had a lot of help with funding is working riders like the product we've been able to provide.

Our customer satisfaction rating is the highest it has ever been in over 25 years of keeping track. We did a public poll and 82% of the public in our three county region had a favorable view of CalTrain. And when we broke that down to frequent writers, it was 91% of frequent riders had a favorable view of us.

But I would be remiss if I didn't say the other side of the story, which is that we have a significant structural operating deficit. Before the pandemic, we were running the railroad basically on selling tickets. We had a 73% farebox recovery rate, which is the highest in the nation at that time.

With the rise of remote work, that's no longer nearly the case. We're still pretty close to nation leading in terms of farebox recovery. But even with our aggressive ridership growth projections, we still have an annual budget deficit of $75 million per year over the next decade.

If we don't find some stable, dedicated source of operating funding soon, our board will have to make some very hard decisions. And we're going to have a workshop about this in April.

And those could include going back to hourly service, cutting our weekend service altogether, cutting about a third of our stations, and stopping service at 9pm and you hear a lot of the things that we just talked about that writers respond to, like half hourly service could be the things we have to give up first.

Just for financial reasons, we are trying to cut costs. I already talked about boosting ridership. We're trying to cut costs. That includes a strategic hiring freeze. One other effort I'm proud of, and that we had some help with the Legislature originally, is that our trains regenerate electricity.

They have regenerative braking, just like a Prius or a Tesla does. So they generate energy when they brake. About half of that energy that we get back, we get about 40% of our energy gets regenerated. About half that we send to other trains to keep them running on the same tracks.

And the other half, the 20-25% of our energy we generate goes back to the grid. And we weren't getting compensated by that for that. It was just going back for free, back to the grid.

So we had worked very hard, worked with Assemblymember Papan's office and our incredible community Choice, Aggregation Partners, San Jose Clean Energy and Peninsula Clean Energy. And we were able to reach a solution where our energy suppliers now compensate us for that energy that goes back to the grid.

So we're really turning over the couch cushions trying to find ways we can raise money that saved us about a million dollars a year in energy costs. Eventually, we do hope to reduce our energy costs and capture More value, even more.

We've got an energy storage feasibility project that looks to save more costs by finding a way to capture regenerative braking energy, storing it ourselves, then feeding it all back to the trains when demand and the cost of electricity is high. This would likely net us much more than just the net billing compensation we get now.

We in August released an RFI which did get us some interest and we're working towards this pilot program. We're also working across a number of efforts for non farebox revenue. The reality is in the way that ridership is now we can't run a train on farebox alone.

So we're looking at non farebox revenue including all the things you see up there, special events, advertising, naming rights, leasing our fiber optic cable and commercial TOD and commercial leasing, trying to get value out of the relatively small land and property holdings we have and also put some riders next to some of our stations.

I've got two more slides. I think this one and the next one wanted to mention that we just had the super bowl in San Francisco. A lot of the events were in San Francisco, San Francisco, the game was in Santa Clara and of course our line connects San Francisco down to San Jose.

So folks were able to ride CalTrain, connect to VTA and get to the Super Bowl. Our ridership was up for that entire week, especially at our San Francisco station. However, with six FIFA World cup games anticipated this summer, we are concerned about the cost of supporting these events.

We estimate that all in the total cost will be about $12 million for us to accommodate the World Cup. And the single biggest cost there is just safety. In part, the games that we all drew are all at night. And so there's additional safety costs including overtime and very late at night overtime.

And then finally I just wanted to touch briefly on some of our major projects and initiatives. We've got two development opportunities at the end of each of our main line.

We have an SF Rail Yards project at our 4th and King station, which is a 21 acre site that we're working on a public private partnership with prologis to try to put significant density on that station right where our most used Caltrain station is.

And it would among other things, potentially bring the second largest tower in San Francisco right to where our Force and King station is. We also have just entitled two towers of our own on CalTrain land right at the station at the other end of our main line, Diridon.

And so we hope to put some commercial and other density there right around one of our other very main stations.

And then finally we would be remiss without saying thank you to the state for providing us funding to try a first of its kind pilot program to run a battery electric multiple unit on the track that I was mentioned. We don't have electrified, but we expect to get our first BMU as we call it, in early 2029.

And that would charge on our mainline and then run on battery power south from San Jose down to Gilroy and potentially beyond, even as far as Salinas. So we are fortunate. We're looking forward to trying that sort of new, relatively untried technology to make our line better and the clean energy extend even further down below.

So with that, I'll wrap up and thank you again for being here.

Okay, well, thank you. You know, I appreciate the way you ended this with some other approaches to revenue. And I wonder if you have any thoughts on this.

I frequently have had this thought after having been on an airport authority board, how much revenue comes from parking and concessions and how transit just does not seem to have monetized that. And I wonder, do you have any reflections on why that is?

I mean I think some of it is, I will say old habits like transit is we right now are charging $5 for parking at CalTrain stations. But we're, that's one of the things we're looking at.

SB 63, which is the legislation that authorized a district for five county revenue measure potentially in November has had requires efficiency reviews for all of the agencies who might get funding, direct operating funding. So as part of that and even before that, we were looking at all the different ways we could be a little more efficient.

And one of those is to take re look at our parking, try to find ways that we could either increase that maybe for non renters because we don't know non renters park at our lots. And that you can park much more cheaply in Silicon Valley at a caltrain lot right now than you can at regular parking.

So I think that's, you know, it won't solve the problem, but it's definitely, it's one of those things where you got to look at everything to try to do what you can to make non farebox revenue.

Yeah, and concessions is another thing. I mean the airport, the fares, fare meaning food and drink offered at airports is usually it's so diverse and it's just really nice and local. And you know, airports have become really lovely public spaces.

And I mean what do you, I mean newer terminals have and we have a new one terminal one in San Diego. So I'M particularly aware of that. But. And I was recently just in the Portland Airport and thinking the same thing. Like, it's just remarkable how nice the facility is and what the offerings are.

But what do you think about that as part of the transit experience?

Yeah, that's another thing we are very focused on. We've got real estate folks looking up and down our line at our stations to see how we can enliven them, make them more. More places that people want to visit, even if they aren't necessarily going to the train.

I think especially on those biggest stations that are 4th and King Line, part of that potential development would, would potentially involve us getting a new train station. And all the discussions around what that would be, would be place making would be make it, make it somewhere that's not just where you get off the train and go away.

You want to go there, you stay there, you spend some money. And same thing at Diridon Station we are working. You know, that would be one of the biggest intersections of rail and bus and Amtrak will be there.

So we really want to take advantage of that station to make it a place where it's more than just a place you end up on the train. And I think that's important.

Even the smaller stations, we're working on that, trying to get them open, trying to get not just a small little coffee shop, but have it broader than that. Have it.

And I'll tell you, I mean, I am equidistant from two train stations where I live and I will often go to one train station because it's got a bagel shop there rather than the other.

Because if I got to get a couple extra minutes and I didn't have time for breakfast, it makes a difference to, you know, everyday normal people.

Right? Yeah. I mean, it does seem like such an opportunity for growth when we're thinking about this really constrained revenue environment. I wanted to ask Mr. Kettle a couple questions. Are you still there?

Yes, ma'am, I'm here.

Okay, great. So I am deeply concerned that your agency is facing service cuts in the months ahead due to the gap in fare revenue, operations, funding and the cost of services. And your member agency.

Agencies reducing their contributions. And you know, I noticed in your presentation when it said LOSSAN reform, stagnant ridership and you have this new fare restructuring plan which went into effect in July of 2025. And so ridership recovery was at 54.9% and until November of 2025 it went to 57%. So it went up 3%.

But that doesn't seem like it's really on a trajectory that's going to meaningfully, you know, change the picture financially.

So I mean, to this question that we were just talking about of really out of the box thinking for a transit operator but or other scenarios, I mean, I don't see you here in the Legislature asking for a bailout or a loan, bridge loan or anything.

I mean, I think tomorrow on the floor of the Senate, we're going to be considering for the Bay Area Transit, you know, a financial approach that has been many months in the making. And I'm very aware of the fact that that does not seem to be happening in Southern California right now driven by you as Metrolink.

So what is happening? I mean, why are you not up here asking for that or what is your plan to make sure that service isn't cut in Southern California in the next couple months?

Well, Madam Chair, I mean you are bringing up, I'll call it the proverbial elephant in the room given our structure as we are a consensus driven organization of the five counties that come together. And we have been raising this issue for several years of the challenge ahead of us.

Most recently a year and a half ago or so, my board in a workshop, we raised the fact that we are at this point really going to struggle from a sustainability perspective if we don't identify a dedicated revenue stream. And as they said earlier, we are completely reliant on our Member agencies.

Those same member agencies are the ones that influence our ability to, to take any sort of action.

And so while we can raise opportunities and we have done so very publicly and we at this point have not gotten to a consensus of the five county transportation agencies that say this is something we're going to look at from a regional perspective and that, that is a, it's a byproduct of our structure.

So because of that, we are at this point because, you know, again with one county putting on us on notice and another, and I don't believe this is going to be the only county this coming budget cycle.

We have to have these hard conversations that my colleague from Caltrain was suggesting that they are going to have to have if that sales tax measure doesn't. The voters in the Bay Area don't get behind it.

So I think right now, one of the things we've done is thanks in part to SB125 and the $5 billion bridge funding we had for operations, we have been able to make this, make this work and to be really. Madam Chair, you spoke of the Transit Transformation Task Force.

We were all counting on that report, at least I was. And, and I think the Metrolink board and maybe the five counties in our system, in our system were counting on strong, bold recommendations related to transit operation dollars. And I've shared this with Caltrans Director, and I've shared this with Secretary Omeshockin.

And it was the report did not speak to that and did not come with recommendations that support whether it's Metrolink or public transit in general. So we, we see that and we're counting on that and we're tremendously disappointed in that in the final product.

So here we are now with this question, and we are going to be forced, I think now to ask the five counties, what is our, what are we going to do? And, and you know, in 1992, when Metrolink was first formed, the five counties came together and said, this is going to be our structure.

This is how we're going to do it. And we have survived under that, that construct for 34 years. That has fundamentally changed because of the, the way the world has changed.

I wish I had a better answer for you, Madam Chair, but that is where we see ourselves and we have some really hard conversations because I have other Member counties that want to see service either stay at the levels they are today and really give this optimized schedule.

Metrolink reimagined the chance it deserves, whereas I have other counties that will be looking at it different. And this is where it really is a challenge is that they have to come together to agree on that because of our, the formulas and how they work. They are going to have to agree on it.

I simply can raise, Metrolink can simply raise this is what we can do for the resources that are available that you're making available to us. So that is the, that is the, the, you know, the situation we find ourselves in.

I mean, are you, are you as the CEO of the organization who has the responsibility but also opportunity to wrangle the cats together to try to chart a course forward?

Are you, do you have any proposals for them that involve them paying less in their subsidy, but you getting revenue in another place, like, for example, monetizing the, the train stations around your lines or selling parking or getting into public private partnerships or broadband or any of these other things that CalTrain just provided on their PowerPoint as alternative revenue streams, is any of that on the horizon for you?

So Madam Chair, you've just hit on something that, that we use in our in commuter railroads. The point, the saying is you've seen one commuter railroad, you've seen exactly one commuter railroad.

So Caltrain has ownership on a variety of things, including the 55 miles or so of the corridor between San Jose and San Francisco where they have all the rights for fiber. Metrolink does not own virtually anything. We own our equipment and we have a couple of little parcels, but we do not own our parking lots.

Those are all either owned by the transportation agencies or of the five counties or the local jurisdiction. And so they, they, they have the possession of that. In the case of the corridors that Metrolink operates on, when we acquired, when the five counties acquired those, well, four of the counties acquired those.

One of the things that did not get was the rights to expand fiber. The, that was protected, saved by the, the Class 1 railroads, which is who we purchased the corridors from. We don't have real estate. We even Union, LA Union Station, our hub is owned by LA County Metro.

So all of the cool things that you talked about as far as the, you know, dining, coffee, sense of place, all of those things that is all to the benefit. Any revenues that come from that are go to Los Angeles County Metro. So there are places that we've been able to find to monetize other opportunities there.

And I heard the conversation about advertising on trains. I couldn't agree more. It is they, they are not attractive and they are not good for the customer to have to look through those little pin.holes when you're driving on that picture behind me and you want to look out and see the ocean.

So it just is not, it's not a customer friendly and it really isn't going, it's not going to move the needle given what we need to do as a region. And you saw the structural deficit for caltrain. And we will find ourselves at least in as difficult a situation as they are.

Okay. And so do you foresee that the counties that, that want to cut are the. Where the service would be cut? So if Orange County wants to cut that the service in Orange County would be cut, but in Riverside it wouldn't be.

Madam Chair, I'm going to say stay tuned. Those will be hard. Those, some of those hard conversations are going to be happening over the course of the next couple months.

I have been informed by the Executive Director of the Riverside County Transportation Commission that they desire to see an opportunity to grow service on that line that I mentioned that goes from the Inland Empire into Orange County, what we call the IEOC line. To do that, they need to have a willing partner on the other end.

If Riverside's prepared to come in with a certain amount of member agency support to continue that service or grow it, they need to have a commensurate level of support from the Orange County side of the line. And again, given.

Given the financial challenges that our OCTA explained to us having to re baseline their sales tax forecast, they're not in a position to do that. So this will involve a conversation. We will identify the issue that there is. Here are your options. Various counties.

And then they are going to have to come to an agreement because they are, again, OCTA owns the corridor south of Fullerton and Riverside owns the passenger system rights on the. What's called the San Bernardino subdivision, which is the line that goes from Riverside to. Into Orange County. So they are going to have to make that call.

We can simply say, this is the service we can provide. But those hard conversations may take place between San Bernardino and Riverside with the Inland Empire and in support of their constituents, their residents who need to get to employment or entertainment opportunities in Orange County.

Right. Okay. Okay. Senator Archuleta, did you want to make any.

Yeah, I would just like to thank you both. Great presentation. I can see, as I said before, we've got to jump in and help out, but we need you to formally make a request so we in turn can carry this to the Transportation Department or the Committee. Transportation Committee.

And onto the governor's office because your routes that you mentioned up and down are too vital for California. So we're going to have to sit down with you and see how we can help in and see what we can do. Make this a joint venture. So I'm willing to do that.

So thank you for your presentation, both of you.

Well, thank you. Thank you, Senator Archuleta. I really appreciate you coming today. Thank you. And I just want to recognize as well the witnesses who participated. It's very important to us that we're able to ask questions. And I appreciate you taking the time to be here today and also to appear remotely for those who did that.

We arrived at today's hearing facing urgent challenges along the LOSSAN rail corridor. And these challenges and questions impact service reliability, the resiliency of our coastline and the performance of services and these questions after this hearing remain unanswered.

Maybe there's been a bit more of the admiring the problem, which is my least favorite thing about what government does. Admiring the problem. But it is really important that we recognize the problem in order to solve it. We heard today updates from responsible agencies on the state of rail services.

I remain concerned that without action, these rail services will not meet the important goals that we care about, specifically reduced traffic traffic, cleaner air and the ability for residents to get where they want to go. As time passes, so too does our ability to respond.

I hope we all feel a sense of shared responsibility and the call to action that drives us toward meaningful and lasting reforms. We know that more must be done to increase passenger rail ridership, not just part of longer term solvency, but because local communities are relying on these transit services for their transportation needs.

It's people who are transit dependent, but it's also people who are choice riders and would like to choose to ride the train. We've now reached this moment where each month is pushing us closer to insolvency and that will hit every corridor operator. I believe that collectively we cannot afford to let that happen.

So we will now receive public comment. If there are any in the room wishing to come forward to the microphone, please do so now. Not seeing anybody coming forward.

I just would like to share that if you would like to make a public comment but you are not here, you can do so by submitting it to the Committee. And with that, thank you everyone for being here today. And we are adjourned.