Government Relations by AGCSD - Legislative / Regulatory Alerts

Legislative / Regulatory Alerts

Contact: Brad Barnum / Vice President Government Relations - 858-731-8158

UPDATE - JULY 2, 2012

It's All About Transportation...More Good News Than Bad Nationally, Statewide, and Locally

The transportation construction industry has been receiving some good news these days, and we wanted to report on activities in Washington, DC, and in Sacramento that will impact our region. There are four areas we would like to highlight, the last of which is a bit of bad news:

Passage of Federal Highway Transportation Funding Legislation

As we reported on Friday, the United States House of Representatives and United States Senate overwhelmingly passed a 27-month highway and transit measure (373-52 in the House, 74-19 in the Senate). This action ends nearly three years worth of temporary extensions that have made it increasingly difficult for state and local officials to plan for, fund, and execute major new infrastructure projects. President Obama is expected to sign the $100+ billion spending bill in the coming days.

"The new highway and transit bill should allow construction to finally begin on many long-delayed, yet vital, projects," said AGC of America's Chief Executive Officer Stephen E. Sandherr. "In addition, this bill will make it easier for a host of long-contemplated projects to move through a regulatory review process that until now was hopelessly inefficient."

"The infusion of federal dollars into San Diego is now a reality, and emphasis was placed on the safety of our nation's workers, particularly in high speed areas," said Thomas L. Brown, Chairman of AGC of America's Highway and Transportation Division.

Senator Barbara Boxer played a major role in hammering out the compromise that was supported by Republicans and Democrats. Senator Feinstein, and San Diego Congressional Representatives Bilbray, Davis, Hunter, and Issa voted "yes" on the measure. Congresssman Filner was one of seven Representatives who did not vote.

A summary of the provisions of the measure and its impact to California and San Diego will be provided at a later date, as we are waiting for some information from SANDAG and Caltrans.

$1 Billion Allocated For Statewide Transportation Projects

Last Thursday, the California Department of Transportation announced the release of nearly $1 billion from the California Transportation Commission for 35 statewide transportation projects. Two local projects will receive funding: the freeway connectors at state Route 905 and state Route 11 (receiving $31.6 million), and a roadway maintenance project on the San Diego-Coronado Bay Bridge (receiving $2.5 million).

The freeway connector project is the first of three projects that will build the new Otay Mesa East Port of Entry and state Route 11 in Otay Mesa. The San Diego-Coronado Bridge maintenance will also include the painting of four segments of the bridge.

New State Transportation Agency Creates More "Focus"

This has been somewhat under the radar screen, but effective tomorrow the State's Business Transportation and Housing Agency (BTH) no longer will house 12 departments and several economic development programs and commissions consisting of more than 45,000 employees and a budget of $18 billion. The reorganization will become effective on July 3, 2012, and operative on July 1, 2013.

As part of Governor Brown's proposal to restructure BTH, the California Transportation Agency (CTA), a single focus cabinet office emphasizing Transportation Policy, has been created. The non-Transportation offices and departments in BTH were distributed to other reorganized state cabinet agencies, leaving the following Departments within CTA:

Department of Transportation

Department of Motor Vehicle

California Highway Patrol

Board of Pilot Commissioners

Office of Traffic Safety

High Speed Rail Authority

California Transportation Commission

"This is the most sensible reorganization the state could take with transportation," said Bert Sandman, Executive Director of Transportation California. "It groups transportation departments and commissions, and it gives transportation a focused voice in the governor's cabinet."

AGC supported the Governor's plan, but did express concern that the California Transportation Commission should continue to be able to operate independently from a policy standpoint due to its responsibility to provide advice and recommendations to both the Governor and the Legislature. The Legislature will consider legislation today that will maintain this "arms length" relationship for the CTC.

Brian Kelly, the current Acting Secretary of BTH, who has a strong background in the transportation arena, may be asked to take the helm of CTA. AGC's legislative advocates know Brian very well and have worked with him in the past....that should help during this transition.

State Budget "Hit" to Local Transportation Funding

Although it was generally good "state budget" news for transportation, millions of dollars of funding for local streets and roads throughout the state will be redirected permanently to the State General Fund to help balance the state budget. AGC, the California State Association of Counties, and the League of California Cities opposed redirecting these funds on a permanent basis.

The specific fiscal impact to counties as a result of this action is the statewide loss of $40 million in 2010-11 and 2011-12 and $28 million in 2012-13 and every year thereafter. Further, cities will suffer an identical loss and Caltrans SHOPP program will experience a loss as well. San Diego County will receive approximately $2.9 million less last year and this year and $2 million every year thereafter. Cities individually will experience lesser reductions.

Rest assured, we will be talking to Caltrans, SANDAG, County of San Diego, City of San Diego, and other public agencies to determine the impact this will have on their respective projects.

Updated: 7/3/2012