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What’s Next For Transportation?

What’s Next For Transportation?. Western Regional Association for Pavement Preservation February 8, 2019. Proposition 6 Summary. Prop 6 (November 2018) would have repealed SB 1 and required any future transportation tax/fee increase to be approved by the voters.

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What’s Next For Transportation?

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  1. What’s Next For Transportation? Western Regional Association for Pavement Preservation February 8, 2019

  2. Proposition 6 Summary • Prop 6 (November 2018) would have repealed SB 1 and required any future transportation tax/fee increase to be approved by the voters. • Proponents tried to frame the issue as a cost of living issue, a can’t trust government issue, and “they” already have enough funding issue. • Opposition countered with arguments – puts projects at risk, doesn’t actually decrease price of gas, and makes cost of living worse in the long run. • No on Prop 6 campaign was 673 organizations strong, raised $49 million (included Prop 69 campaign from June 2018). • Paid media, earned media, direct mail, digital advertising, website and social media. • The No on Prop 6 campaign prevailed with 56.8% of the vote. • Campaign is over – now what? Projects, transparency, and accountability.

  3. Mystery Fuel Surcharge • The Sacramento Bee published a story last week that gas is getting more and more expensive. • A committee working on behalf of the California Energy Commission discovered an “unexplained surcharge” in September 2017 costing Californians over $17 billion since February 2015, or $1,700 for a family of four. • Nineteen Democrats sent a letter to Attorney General Xavier Becerra earlier this week asking him to lead an investigation. • In the letter, the legislators told Becerra the surcharge averaged 2 cents per gallon from 2000 to 2014 but soared in 2015 after the Torrance refinery fire. The cost spiked to an average of 24 cents a gallon in 2018. • The report found that even when accounting for California’s gasoline tax and greenhouse gas reduction costs, prices have “exhibited a continuous and unexplained differential compared to the rest of the country”.

  4. Transportation-Housing Linkages • Governor Newsom has made public statements in support of leveraging local shares of transportation funding to incentivize affordable housing development. • Nothing is in writing, a specific proposal has not been released. • But, some previous proposals say… No gas tax $$ if not meeting RHNA. • Under Article XIX, what is even possible? • Broad opposition from transportation stakeholders.

  5. FAST Act Reauthorization • The Fixing America’s Surface Transportation (FAST) Act will expire on September 30, 2020. • Like CA’s recent challenge, the federal gas tax hasn’t been increased since 1993 and the HTF is insolvent. • Chairman of the House T&I Committee Peter DeFazio reported that last year, we spent about $13 billion more from the HTF than we collected in revenues. The general fund has been closing the gap. • The Trump Administration’s nominee for Federal Highways Administrator told Congress that they should consider every available tool that would result in long-term funding for infrastructure projects. All options are on the table. • Sound familiar? More from Chairman Peter DeFazio... "I want people to emphasize how stupid we are and how unbelievably expensive it is if we don't make these investments and we take the system to failure," DeFazio said. "If we don't make these investments now, it takes 10 years or so to plan and build" major projects, he added, "and it's gonna cost us 10 or 20 times as much as making the investments.”

  6. Alternatives to the Gas Tax • Despite annual indexing of fuel taxes per SB 1, the gas tax is a declining revenue stream (fuel efficiency, alternative fuels, and electric vehicles). • The California Road Charge Technical Advisory Committee (est. 2014) was tasked with studying road charge alternatives to the gas tax. The TAC studied: • Feasibility – the viability of recording and reporting of vehicle miles traveled for a statewide road charge system, • Complexity – the degree of difficulty of implementing a statewide road charge system, • Security – ensuring the safeguarding of personally identifiable information and data in a statewide road charge system, and • Acceptability – surveying the acceptability of a road charge as an alternative to the gas tax. • Key findings: Overall participant satisfaction was favorable with an overall approval rating of 85 percent, which is further supported by the low dropout rate of 4 percent. • Next steps: Caltrans in collaboration with the FHWA, will be investigating the feasibility of a pay-at-the pump option for a road charge system.

  7. Transportation and Climate Change • SB 150 Report – The state is not is not on track to meet greenhouse gas emissions reductions expected under SB 375. • Vehicle miles traveled (VMT) are increasing, state will likely start to reexamine local land use authority, cap and trade v. carbon tax, etc. • AB 40 (Ting) would, no later than January 1, 2021, require the state to develop a comprehensive strategy to ensure that the sales of new motor vehicles and new light-duty trucks in the state have transitioned fully to zero-emission vehicles by 2040. • SB 43 (Allen) would, require CARB/CDTFA to submit a report to the Legislature on the results of a study, to propose, and to determine the feasibility and practicality of, a system to replace the tax imposed pursuant to the Sales and Use Tax Law with an assessment on retail products sold or used in the state based on the carbon intensity of the product to encourage the use of less carbon-intensive products.

  8. Project Delivery & Environmental Streamlining • Speeding up environmental review processes and project delivery has multiple benefits – to taxpayers, motorists, and the construction industry – without sacrificing environmental protection. • A number of important policy decisions are languishing or need immediate attention by the Legislature and/or Administration: • Public-Private Partnerships (P3) • NEPA Delegation • CEQA for NEPA Reciprocity • CEQA streamlining • Other ideas?

  9. Summary • YAY – we defeated Prop 6 and ensured $5.4 billion annually to improve our infrastructure and support the construction industry. • BUT – lets be vigilant and vocal. • We didn’t even get into automated vehicles, trends in mobility, and how technological advancements have the ability to fundamentally improve quality of life or exacerbate current problems. • We didn’t get into congestion pricing, or reduced voter thresholds, or… • Exciting times – much work remains. • Invite me back and we’ll keep talking!

  10. Kiana Valentine Principal Politico Group kiana@politicogroup.com (916) 266-3892

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