California County News

Alameda’s Transportation Commission Proposes Ballot Measure to Increase Sales Tax

Los Angeles County was the first county in the state to raise its transportation sales tax to a penny and now Alameda County could be the second. The Transportation Commission has now proposed the sales tax increase for the November 2012 ballot, and if it is to pass, it will require a two-thirds vote. Officials have been debating in Alameda whether to extend the current half-cent countywide sales tax or to raise the tax to a penny, and now the decision has been made for the creation of a new transportation expenditure plan. Improving public transit and repairing road conditions are the areas of focus that the boost in funds would address. The current half-cent tax will expire in 2022. The Contra Costa Times reports:

“The measure would raise some $7.7 billion in new funds over 30 years, including a proposal that has roiled debate about allocating $400 million to partially fund a BART rail extension to Livermore. ‘Our roads will deteriorate and our congestion will worsen if we don't act,’ said Tess Lengyel, a deputy director for policy for the commission.  The agency is overseen by a 22-member board of elected city, county and transit district board members. ‘We also are planning improvements to serve a population expected to grow by 500,000 people,’ Lengyel said.”

So will voters be in the mood for paying more? The county says a recent poll shows 69 percent of Alameda County residents would support the tax measure. But there is some concern about the fact that the tax increase does not have an expiration date, meaning it will be made permanent. But to address such criticism, the ballot measure may include a stipulation in which county voters would be empowered to vote in 2042 on what projects should be funded.

We relayed back in September that the Governor signed Assembly Bill 1086, which allowed Alameda County’s Transportation Commission to place a tax hike on the ballot for November 2012’s election. Patch reported that the legislation was needed because it “provides a one-time exemption from the existing 2 percent cap on local sales taxes. Recent sales tax measures approved in San Leandro and Union City would otherwise have prevented a countywide measure because it would exceed the 2 percent cap.”

Kings County Looks to Block High-Speed Rail Project with Lawsuit

Kings County is where construction on the high-speed train project is slated to begin, but officials in the rural county are steaming over the $99 billion transportation undertaking; consequently, the county is filing a lawsuit against the High Speed Rail Authority to halt the rail line from being built all together. According to the county’s argument, voter-approved state bond funds should not be spent on a project that has changed since 2008, and since voters have not had a say on those changes, the county believes funds should he withheld because the costs and scope of the project have grown greatly. The Fresno Bee reports:

“According to the suit, the authority's construction of the Valley portion of the rail line illegally uses Prop 1A bond funds for a non-electric, or conventional, rail line. The suit states that because the proposition called for an electric rail system, the use of proposition funds for a non-electric rail line -- even in the "preliminary" stage -- violates state law. Redwood City attorney Michael Brady, who is representing Kings County and co-plaintiffs John Tos and Aaron Fukuda, said the authority failed to seek approval from the Public Utilities Commission and federal agencies following the passage of Prop 1A.”

We relayed back in October that the Kings County Board of Supervisors called for a resolution that outright opposed the project’s route within the region and residents in the county had been concerned about the rail’s impact on farmland. The officials have been concerned about the designated pathways of the train but rail officials reportedly would not sit down with officials in public meetings because they disagreed with the county’s legal interpretation of a law that would require them to participate. Cities in the Peninsula region of the state have also raised objections about the project, which has delayed planning.

To read the lawsuit, see here.

Sonoma Supervisors Take a Close Look at a County-Run Power Agency

Sonoma County Supervisors have indicated they are up to the challenge of becoming only the second county in the state to get in the business of supplying power to local residents (Marin is the only county that currently does). Under state law, local governments can buy energy on the wholesale market to sell to residents and businesses and the county is currently considering the tradeoffs to this option. For instance, residents could have to pay more over a 20-year period. Reportedly if the county provides power then residents would have to pay $4 to $10 more per month. And while one scenario suggests the rates would continue to rise until 2017, afterwards the cost for customers would drop greatly to as low as $1 dollar more per month in 2032. Supervisors discussed the findings of a report regarding the switch on Tuesday. Supporters of the change posit that it could also create new jobs and the county would be able to purchase greener, renewable power. The Press Democrat reports:

“Chairman Efren Carrillo, seeking perhaps to put the current board's stamp on the issue, has called the power effort ‘an imperative’ for the county. ‘What this report tells me is the program is feasible and that it's time to take the next step,’ he said Monday in an interview. The report evaluated rate implications for customers under four different scenarios, each with a higher percentage of power in renewables, including wind, solar, geothermal and biomass generation. The two scenarios with the most aggressive renewable push — resulting in more than double the state's mandated 33 percent standard by 2020 — saw the largest short-term rate hikes with lower comparable rates in future years.”

The exact costs of the switch are not yet clear and officials acknowledged that further study would be necessary. While there appears to be broad support, concerns have still been raised about the economic impact and the effect on taxpayers. A partnership with Marin County has been put on the table as an option to help reduce costs.

Kings County Officials Want to Wash Their Hands of All High-Speed Rail Routes

Frustration with the High-Speed Rail Authority has led the Kings County Board of Supervisors to call for a resolution that would outright oppose the project’s route within the region. In the past county officials advocated that the train should follow existing transportation corridors, but attempts to engage in a dialogue with the Authority have proven frustrating, according to supervisors. The officials have been concerned about the designated pathways of the train but rail officials reportedly would not sit down with officials in public meetings because they disagreed with the county’s legal interpretation of a law that would require them to participate. The board was supposed to prepare a response to an environmental impact report within 60 days, but supervisors wanted that period extended to 180 days, a proposal that was rejected by rail officials.

The Hanford Sentinel reports: “’I think we should come out and oppose high-speed rail in Kings County, no matter what alignment they have,’ said Supervisor Tony Barba during a discussion of the county’s official response to the EIR, which is due Thursday. He was applauded by a large crowd that nearly filled the Board of Supervisors’ chambers at the Kings County Government Center.”

Many residents in the region have been concerned about the rail’s impact on farmland. A vote on the resolution is expected on Tuesday. ABC filed the following coverage:

Governor Signs Bill that Will Allow Alameda County to Consider a Tax Hike for Transportation

The governor has signed Assembly Bill 1086, which will allow Alameda County’s Transportation Commission to place a tax hike on the ballot for November 2012’s election. If the measure moves forward, it would help fund infrastructure and transportation projects. Patch reports that the legislation was needed because it “provides a one-time exemption from the existing 2 percent cap on local sales taxes. Recent sales tax measures approved in San Leandro and Union City would otherwise have prevented a countywide measure because it would exceed the 2 percent cap.”  If county officials ultimately place the issue before voters, it will require two-thirds support from county voters in order to be enacted. Commissioners are reportedly still deciding on whether or not to extend the current half-cent countywide sales tax or to raise the tax to a penny. The bill was introduced by Assemblyman Bob Wieckowski, D-Fremont. The legislator released the following statement in light of the governor’s signature:

“The county is updating its transportation plan and this legislation gives it the option to ask voters to invest in long-term improvements in Alameda County. The potential is there to create jobs to repair our roads and maintain our infrastructure to meet the needs of local residents and businesses.”

Mark Green, chair of the Alameda County Transportation Commission, also released a statement:

“We appreciate Assemblymember Wieckowski’s leadership in authoring AB 1086, which allows Alameda County residents a choice to improve transportation throughout Alameda County. Governor Brown did the right thing in signing AB 1086 today since it supports his ideas of government reorganization throughout the state.  It is now up to the elected officials in Alameda County to forge the creation of a new transportation expenditure plan that voters will approve in November 2012.”

Luring Wine Tourists: Supervisor Says Plans for an Excursion Train in Sonoma Aren’t Feasible

Several months ago a consultant for a development corporation proposed to the Sonoma-Marin Area Rail Transit (SMART) and North Coast Railroad Authority an excursion train route that would travel in Sonoma and Marin counties to attract wine country tourists. There is already a popular train that runs between Napa and St. Helena, which reportedly transports around 135,000 people per season. But is the idea for Sonoma and Marin feasible? Richard Deringer is the consultant for Odyssey Development, LLC, and Ryder Homes of California that proposed the idea to officials. Odyssey owns commercial developments along the tracks. The North Bay Business Journal reports that Valerie Brown, a Sonoma County supervisor, commented the following about the train’s likelihood: “Rick is a very big thinker, and if it were operated for him it would be great, but it doesn’t. His idea isn’t probably very doable.”

Notably, another railroad freight operator reportedly already has the first rights to any excursion train. In addition there are already major construction projects that are planned, so officials contend such plans must be given priority. For more, see here.

Study Says Expansion of Toll Road in Orange County Would Create 17,000 Jobs

The expansion of the 241 toll road in Orange County has been a controversial issue, as environmentalists have fought the proposal for years. When it was originally proposed to extend the toll road south to Interstate 5 near San Onofre, environmentalists said too much damage would be done to Trestles Beach and San Onofre State Park. In addition, the Coastal Commission vetoed the idea. But in these tough economic times, a new study could motivate further consideration, as the report claims completing the expansion project would create more than 17,000 jobs statewide. Of those jobs, 13,663 would be created in Orange County and the state and local government would receive a boost of $160,000 million annually. This study was commissioned by the Transportation Corridor Agencies. Bill Campbell, Foothill/Eastern Transportation Corridor Agencies chairman, commented the following:

“At a time when the federal government is looking to stimulate jobs through investing in infrastructure, the good news is that we have a project right here that can make a real difference for families in Southern California. Completing the 241 Toll Road will stimulate the creation of more than 13,000 jobs in Orange County alone. And we remain committed to the fact that job creation and protection of the environment are not mutually exclusive.”

Several business groups are rallying around the study’s findings and touting the toll road’s contributions to the county. The Transportation Corridor Agencies has created a website called RelieveTraffic.org that asks residents to take action and support the expansion. The website states that “completing the 241 means more than just relieving traffic between LA and San Diego, two of the nation's busiest business hubs. It means creating thousands of jobs and helping our economy bounce back.”

The environmental group the Surfrider Foundation released the following statement about the study’s conclusions:

“During the 2008 California Coastal Commission consistency hearing in Del Mar, Transportation Corridor Agencies CEO Tom Margro himself testified that the estimated amount of labor required for a widening of the existing I-5 was at least comparable to, if not greater than, the proposed extension to SR-241. By stymying the I-5 widening project in favor of the SR-241 extension, the TCA are not only inhibiting job growth, they are continuing to pursue more costly and less effective solutions to South Orange County's traffic woes." 

Read the full study here. (PDF)

Economic Boost? $800 Million in Infrastructure Investments Earmarked by CalPERS

CalPERS has announced that up to $800 million will be earmarked for investments in California infrastructure projects, which should provide the state’s neglected roads, bridges, power transmission lines, and more with some much needed attention. The investments will impact transportation, energy, natural resources, utilities, water, communications and other social support services. With construction jobs lagging greatly, it is hoped such funding will boost the economy; that being said, the investment money will be rolled out over the course of three years so the impact may be less dramatic than hoped for. The Bee points out that “The move reflects big investors' growing appetite for public infrastructure. State and local governments have raised billions of dollars in recent years by selling or leasing major assets – highways, parking systems, and others – to the private sector.”

Rob Feckner, President of the CalPERS Board of Administration, commented that “We remain committed to California’s future and the investment opportunities that run deep between our coastline, mountains and valleys. We are prepared to increase our investments in infrastructure with our first and foremost goal being on investment returns, and a secondary goal of supporting essential community services that are crucial to continued economic development, a safe environment, and healthy schools and communities.”

CalPERS officials noted that investment opportunities would be evaluated on the basis of minimal competition, stable revenues and returns, low operating risk and strong credit. George Diehr, Chair of the CalPERS Investment Committee, commented that “We’re looking for long-term economic value by providing safe, reliable, efficient and high quality services that are vital to California that not only meet our risk-return objectives, but that we believe have the extra benefit of creating jobs and ultimately improving the economic climate.”

The Perfect Storm: Public Infrastructure Expert Outlines Consequences of Aging Network

The Los Angeles Division of the League of California Cities was pleased recently to welcome guest speaker Richard Little, the Director of the Keston Institute for Public Finance and Infrastructure Policy at USC. Little informed attendees that when it comes to infrastructure finance, reinvestment is badly needed and the nation is on the verge of a perfect storm in funding civil infrastructure.

The Keston Institute actively addresses the economic policy, financial, demographic and other dimensions of public infrastructure development in California, in addition to undertaking research, outreach, and education activities to further understanding and awareness of present infrastructure challenges. The word “challenges” is fitting to describe the work and financing that the structures we all rely upon greatly need; in fact; Little argued that if the country is to restore infrastructure back to decent levels, the costs are in the trillions.

When it comes to actually paying for infrastructure, Little pointed out that we need to think about how we actually view it’s role; to be specific, is it a public good, a market commodity, or something in between? If taxes are chosen as the means to fund infrastructure, we can conclude it is seen as a public good, and if fees are used for funding, then it is seen as a commodity. In California, Little believes that ongoing projects relying on bond funds won’t be able to continue because current patterns are unsustainable barring tax increases or spending cuts, as he noted that we can’t bond our way out of our predicament.

While voters may understand that without tax increases services will be limited, there are undoubtedly plenty of stakeholders to satisfy when it comes to infrastructure projects, such as environmental concerns, and it is no easy feat to deal with conflicting demands. In detailing where financing can come from, Little listed options such as taxes (general or targeted), user fees, non-enterprise revenue streams, revenue from asset monetization, and leveraging public money with private capital for a public/private partnership (PPP). Little also mentioned the ample capital in pension fund investments as a way to finance revenue-backed projects, among other financing methods.

Little pointed out that it’s important to realize that public/private partnerships are merely a delivery method and that while entering into such an agreement can be advantageous, it’s vital to set clear goals and establish trust between entities. Also, transparency, fair competition, and appropriate value for the cost are among the concerns that PPPs raise. A lack of accountability and poor organizational culture can lead to great deficiencies in project management, resulting in inflated budgets if either public or private leadership is not held responsible.

Staying economically competitive depends on an efficient and functional infrastructure, but as it stands, our nation’s bridges, highways, and other systems are in steep decline—despite their maintenance being in our great interest. According to Little, the country’s avoidance of taxes and fees for infrastructure has created a lack of adequate revenue streams to renew our critical systems, and furthermore, how such revenues are created is not as important as just having revenues to begin with. However, the focus on having funds solely from a policy perspective does not seem to take into account the political capital required to raise such revenues, especially at a time of great fiscal hardship. Simply put, it’s easier said than done when anti-tax movements are increasingly vocal and voters don’t want to see their wallets get hit. It seems in the end that if paying to address our infrastructure problems is avoided, the nation will pay in other ways, namely greater economic decline, among the other consequences of an aging infrastructure network.

Mobility Survey Shows Strong Support for Infrastructure and Transportation Investments

Roads, bridges, and transit systems badly in need of repair or updating are on the minds of Americans, according to polling from HNTB that indicates a majority of public opinion is in favor of greater federal investment in the country’s transportation choices. Here in many parts of California, we’re no strangers to traffic, and according to the survey’s results, almost 60 percent would be willing to take a hit to their wallets if it meant their time in traffic was reduced by 20 percent. Cutting to the chase, it appears Americans are in favoring of incurring the costs (namely tolls and taxes) if it means they will have expanded transportation choices and reduced congestion. 

So why does public opinion seem so strongly in favor of repair (and the costs that it entails)? Simply put, Americans view roads as being in bad shape, as over 80 percent indicated that roads in their region would receive a “C” or less, and two-thirds think roads are past their prime. The mobility survey also showed that when it comes to funding long-term transportation investments, most were in favor of tolls on roads and bridges. Paul Yarossi, president HNTB Holdings Ltd, stated the following of the results:

“Our country always has made great strides in improving economic opportunities and the nation’s quality of life when investing in its transportation network. This can’t be a partisan issue.”

Notably, most Americans in the poll indicated that they felt that state and federal gas taxes were no longer sufficient when it comes to funding road and bridge maintenance. Read more about the survey here and here.