The mayoral candidates stopped by Move LA's 5th annual transportation conversation last February to join the conversation about:
• accelerating the Measure R funded transit construction program,
• reducing the local voter threshold to 55% to make it easier to win transportation funding measures that are placed on the ballot,
• ensuring that housing near stations remains affordable to high-propensity transit users, and
• Mayor Villaraigosa’s Transit Corridors Cabinet -- which is coordinating and focusing city policy and investment around new and existing stations in the city. (Currently there are 71 light rail and bus rapid transit stations in the city, with 42 new stations coming soon.)

We wanted to remind you of the commitments they made to the audience of 600, and show you the very short video clips posted on the left of our website. (In alphabetical order, Garcetti is first, Greuel next.)

Eric Garcetti said, “Yes, of course,” he is committed to reducing the voter threshold to 55% so that a majority vote can approve future transportation funding measures on the ballot – whereas the current 2/3 supermajority requirement means a minority vote of 1/3 decides. Four bills have been introduced in the California legislature this session to reduce the local voter threshold for transportation funding measures to 55%. And Garcetti said he would "carry on" the Transit Corridors Cabinet "because looking at the intersection between transit and community development is critical – even though these were segregated topics of conversation not so long ago.”

Wendy Greuel said, “Absolutely, yes,” as mayor she would support going back to the voters to get Measure J passed. Measure J, which would have extended the Measure R sales tax to enable LA Metro to finance an accelerated transit construction program, won a 66.1% of the vote but failed to win the required 2/3 supermajority last November. Gruel added that she was very pleased with the Transit Corridors Cabinet, noting that when the first segment of the Red Line opened back in the late 1990s “we weren’t even thinking about planning for development around stations. We can no longer afford to think that public transit is for somebody else and not for us,” she added. “And we need to ensure that all stakeholders are involved in redeveloping neighborhoods around stations."

MORE GARCETTI

Garcetti added that he believes we should also reduce the threshold for funding for affordable housing projects as well as transportation projects, noting that affordable housing projects near transit stations in his district helped revive the real estate market in Hollywood. The pending bill (SCA 11) that we favor, by Senator Lonnie Hancock, would enable cities or counties to put affordable housing funding measures as well as transportation measures on the ballot and to win with a 55% vote.

Garcetti asked the audience to consider what his district was like 10 years ago – when the neighborhood was overrun with prostitution, drugs, gang violence, and murder. While it is still the third poorest council district in LA, he notes that the revitalization around the three subway stations has been remarkable, much of it due to the construction of affordable housing enabling lower-income people to live near where they work instead of commuting from lower-cost neighborhoods and contributing to traffic congestion.

He notes that his district added 5% more jobs during the recession even as other districts lost jobs, and he cites important transit-oriented development projects like the W Hotel at Hollywood and Vine, “which provided living wage jobs, and offers luxury housing, middle-class apartments, and 25% affordable housing with no subsidy from the city.”

MORE GREUEL

Greuel says she supports accelerating construction of Measure R funded transportation projects because she wants to see these improvements made “in my lifetime” – so that projects can support the taxpayers who will vote on whether to fund them as well as their children. She added that it’s critical that the City of LA work closely with LA Metro to make this region as competitive as possible for federal grants and other funding.

Greuel also said that while it’s important to build housing around stations it’s as critical to make sure there’s a jobs/housing balance so that that long commutes don’t contribute to the region’s notorious traffic congestion. People and businesses consider the problem of traffic when they made decisions about whether to move here, she says, “and we need investments in better streets and sidewalks, bus and rail – we need a seamless transportation system.”

She spoke briefly of working for former Mayor Tom Bradley, “who believed that we should have a public transportation system that works for everyone, and that no part of LA should be left behind when it comes to housing, transportation, public safety and social services.”

Note: Their responses were remarkably similar, which is interesting since neither heard the other’s response, suggesting that in fact these are the right answers to the questions!

Move LA visited Sacramento last week, where we discussed the many issues and bills we care about that are now being considered by a legislature that is currently controlled by a two-thirds Democratic majority in both houses. Uppermost on our list are Cap and Trade legislation, and four bills that would reduce the local voter threshold for transportation funding measures from two-thirds to 55 percent. We were attending a “Transportation Choices Summit” hosted by the Bay Area nonprofit TransForm, and at that event TransForm’s Jeff Hobson made one of the more stirring endorsements of the 55 percent legislation: “I believe in democracy and in majority rule, not rule by a minority,” he said, referring to the fact that the two-thirds requirement means that every “no” vote counts twice as much as a “yes” vote, thereby allowing the minority to rule. “But I am willing to settle for 55% not 51%.”

Move LA also testified at an Assembly Transportation Committee hearing on AB 1002, a bill that Move LA is co-sponsoring with TransForm and the Safe Routes to School National Partnership, which would levy a $6 vehicle registration surcharge with the revenues going to congestion reduction strategies including transit operations and discounted transit passes, bike and pedestrian projects, and competitive grant programs for sustainable community strategies. Transportation Committee Chair Bonnie Lowenthal recommended the bill to her committee, which supported it with a 9-6 vote. The bill is authored by former Santa Monica Mayor Richard Bloom.

The prospect of considerable Cap and Trade revenues combined with the prospect of a lower voter threshold for ballot measures to fund transportation projects and other local government services is fueling optimism in the Capitol. Legislative staff we spoke with went so far as to call this session potentially “transformational.” Finding new sources of funding for transit operations in order to expand service and keep fares low is a key Move LA goal this session. The following bills are also of special interest:

CAP AND TRADE REVENUES
Cap and Trade (AB 574 and AB 1051): This discussion is centering around how Cap and Trade revenues should be allocated. A “cap” on emissions will be lowered every year by 2-3% with the goal of reaching 1990 GHG emission levels by 2020. Polluters can either reduce their emissions or buy tradable credits from other polluters who have reduced emissions, thereby generating revenues estimated at somewhere between $1-$3 billion per year in the near term and much more in out years — though no one can predict the success of this program. Since 40% of GHG emissions come from the transportation sector in California it’s assumed that 40% of the money will be allocated to clean transportation. AB 574 (Lowenthal) would fund transportation network and demand management, public transportation including operations, maintenance, complete streets, bike and pedestrian safety, safe routes to schools, development and adoption of plans and policies to implement regional plans, and community infrastructure to support transit-oriented development. AB 1051 (Bocanegra) would fund these projects as well as affordable housing and energy efficiency improvements to existing affordable housing — acknowledging that transportation needs are driven in large part by where people want and can afford to live and therefore affect transportation sector emissions.

REDUCING THE VOTER THRESHOLD
A total of eight bills have been introduced to lower the voter threshold to 55% for funding measures for a variety of projects and services, and four include transportation (three of them for both capital and operating): SCA 4 (Liu) and SCA 8 (Corbett) would reduce the threshold for transportation projects only, while SCA 11 (Hancock) is a broader lowering of the threshold for transportation as well as other projects and services. ACA 8 (Blumenfield) would lower the local voter threshold for bonds proposed by transportation agencies, cities and counties but would not include operating costs. Surveys done in 2009 show that more voters support reducing the threshold for a variety of projects and services and, interestingly, that only about a third of all voters know that a “special purpose” tax or bond measure — one that specifies what will be funded, as Measure R did — requires a two-thirds vote.

USE OF TAX INCREMENT FINANCING NEAR TRANSIT
SB 1 (Steinberg) would create Sustainable Communities Investment Authorities that would be able to use tax increment financing — which dedicates future increases in property tax revenues to finance improvements and projects that will help bring about increases property values and therefore tax revenues — in the half mile radius of transit stations and along high frequency bus corridors.

CALIFORNIA HOMES AND JOBS ACT
SB 391 (DeSaulnier) would create a $75 recording fee for real estate transactions to create a trust fund to be used for housing that is affordable to low- and moderate-income households. This would help replace the $1 billion for affordable housing that redevelopment generated annually until it was ended by Governor Brown last year, and to replace the revenues from affordable housing bonds, which have been mostly used up.

SAFE ROUTES TO SCHOOL
AB 1194 (Ammiano) would require that the existing Safe Routes to School Program be funded by an annual appropriation of at least $46 million. Funding for the current program, which has proven enormously popular and effective, was to be consolidated into a group fund for many kinds of projects.

The America Fast Forward (AFF) Bond Program will appeal to a Congress concerned about the federal deficit and a Highway Trust Fund that is running on empty:

Congress will begin consideration of the next big transportation reauthorization bill in May or June, but concerns about the budget, the federal deficit, and the pending insolvency of the Highway Trust Fund will stand in the way of a robust transportation funding program. The Trust Fund, which is funded by the national gas tax and is the major source of federal transportation funding, has been depleted due to the greater fuel efficiency of cars, the fact that Americans are driving less, and because the gas tax was set at 18.4 cents per gallon in 1993 and does not rise with gas prices, and because it was not indexed to inflation. Whereas the gas tax represented 17 percent of the price of a gallon of gas in 1993, today it represents just 5 percent. The Trust Fund is projected to be running on empty in 2014 and has required transfusions of about $10 billion a year from the General Fund. This is not sustainable but neither does this Congress appear willing to increase the gas tax.

Financing strategies are easier to support than increased funding for grant programs because they require less money up front and leverage significantly more money from state and local governments and the private sector:

These federal financial constraints make all transportation funding requests more difficult but they make financing strategies particularly attractive because federal funding for transportation would leverage additional investment from state and local governments and private investors. A loan program, for example, can serve more applicants than a grant program because the principle is paid back, making the money available to more applicants. A bond program would allow state and local governments (such as LA Metro) to issue bonds secured by a revenue stream (such as the Measure R sales tax) that would be bought by private investors. The federal government’s role would be to provide these investors with federal income tax credits in lieu of interest payments. This enables the federal government to use a relatively small amount of funding — for the tax credits — to leverage significant additional investment from state or local governments and private investors. This makes the bond program appealing to both conservatives who want to stretch federal dollars and New Deal Democrats who want to invest in infrastructure.

The AFF bond program would enable LA County to complete its ambitious 30-10 Plan and to encourage similarly transformative transportation infrastructure improvements in other regions:

The bond program would provide LA Metro with the ability to complete Measure R funded projects now and pay back the principle over time using Measure R sales tax revenues. By providing state and local governments with this financing capacity the federal government would incentivize other regions to do what voters did in Los Angeles County — step up and vote to tax themselves to modernize their transportation systems by creating a revenue stream that can be used to secure financing. This allows the federal government to stretch federal dollars by leveraging additional investment at the state and local levels where in the aggregate there is significantly more money. The U.S. has fallen behind other countries in investing in infrastructure, especially China and India, which are investing aggressively in transportation. Now is the time to make these investments, while interest rates and construction costs are at historic lows and while unemployment remains stubbornly high in many states including California. The AFF bond program is estimated to create 500,000 private sector jobs nationally, and these are good jobs that can support families. Grant programs will remain an essential part of the federal transportation program, but in this time of federal budget constraints financing programs will be key to leveraging additional investment.

The proposed $45 billion AFF bond program will actually cost the federal government only $7.5 billion over ten years while attracting $100 billion in investment:

It is proposed that the bond program be authorized at $4.5 billion a year over 10 years for a total investment of $45 billion. This 10-year $45 billion program is projected to cost the federal government just $7.5 billion since the federal government is only providing tax credits in lieu of interest to investors, while state and local governments would pay back the principle. Since the bonds are only a part of the revenue stream that would be attracted to these investments, this financing program is expected to leverage transportation infrastructure investments worth about $100 billion over 10 years.

The AFF bond program is the third of three parts to the 30-10 Plan to accelerate LA County transit projects:

•  #1: Applications to the Federal Transit Administration’s New Starts funding program for grants for the Westside subway and the Regional Connector — which were recently recommended for funding in President Obama’s 2014 budget;

•   #2: Applications to the U.S. Department of Transportation’s recently expanded TIFIA low-interest loan program. California Senator Barbara Boxer, working with LA Mayor Antonio Villaraigosa and LA Metro, provided the leadership needed to increase funding for this program ten-fold — making TIFIA the largest transportation infrastructure financing fund in U.S. DOT history. LA Metro has applied for a loan.

•  #3: The proposed bond program. It should be noted that this bond program is unlike the bond program that President Obama is called “America Fast Forward” in so far as he is proposing an interest subsidy of only 35 percent, compared to the 100 percent subsidy that Los Angeles is requesting.

Policy precedents for the AFF bond program:

Congress has recently enacted similar tax subsidies for other sectors of the economy but not for large-scale transportation investments. Congress has enacted half a dozen tax credit bond programs since 1997 for purposes such as public education, disaster recovery, clean renewable energy, forestry conservation and energy conservation. These tax credit bonds provide federal buy-downs of 70 to 100 percent of the interest. Each program has a volume cap and maturity limitation.

How the bond program would be structured:

1)      This program would amend section 54 of the Internal Revenue Code to establish a new class of tax credit bonds specifically designed to stimulate greater investment in surface transportation infrastructure projects.
2)      It would authorize the issuance of $45 billion of AFF bonds by state and local governments over a 10-year period. It would be phased in over 10 years ($4.5 billion/ year) to meet the needs of multi-year capital programs, to incentivize states and local governments to create local transportation revenue sources (like Measure R in LA), and reduce the impact of the tax credits.
3)      The Secretary of Transportation would allocate a portion of the total volume cap to sponsors of “major transportation projects” that meet certain goals, such as providing significant regional and national benefits including mobility, safety, economic competitiveness, livability and environmental sustainability. The secretary would allocate the remaining volume cap to the states according to some equitable formula such as each state’s share of the national population.
4)      AFF bonds would be authorized to have a maximum maturity of 35 years, which is longer than other bonds and would therefore require a greater federal subsidy.

Why transportation investments require a special bond program:

While Congress has recently enacted similar tax subsidies for other sectors of the economy it has not done so for large-scale transportation investments such as LA’s transformational Measure R-funded “portfolio” of projects. Current tax law sets a maximum bond term of approximately 15-25 years, which limits the present value benefit of the federal subsidy to 50 percent of debt-financed project costs. However the long life of transportation improvements and the benefits that these investments (especially transit investments) engender above and beyond increased mobility —economic development, jobs, congestion relief and transportation efficiency, emission reductions, energy self-sufficiency, improved livability and safety — provide a strong argument for a longer bond maturity and higher subsidy. We are proposing a maximum maturity of 35 years.

 

Move LA is co-sponsoring AB 1002 by Assemblyman Richard Bloom, which would levy a $6 vehicle registration surcharge that would provide $180-$200 million a year to be distributed this way:
•  40% to transportation commissions and operators for transit operations and discounted transit passes for seniors, students, low-income youth, the disabled, and other populations;
•   50% to cities and counties for first-mile/last-mile bicycle and pedestrian infrastructure, complete streets and Safe Routes to School projects;
•   10% to metropolitan planning organizations for competitive grant programs to help cities and counties implement SB 375.

Why AB 1002 and why now? California residents are increasingly interested in taking transit, walking and biking — to save money, to lead more active and healthy lifestyles, to avoid traffic congestion, and/or because they are concerned about climate change and this country’s continued dependence on oil.

But local governments have limited resources to spend on transit operations, bike and pedestrian projects. Smaller, more local, less expensive bike and pedestrian projects don’t compete well against larger highway and transit projects in countywide or regionwide transportation funding programs. And funding transit operations has never been easy because it requires an ongoing and reliable revenue source, whereas capital programs to build projects only need a one-time infusion of revenue.

AB 1002 would create a dedicated, ongoing source of funding for both operations and bike/ped projects, providing Californians with alternatives to owning one or more cars.

The bill is first heard in the Assembly Transportation Committee on April 22. The author is first-term Assemblymember Richard Bloom, former mayor and councilmember in Santa Monica.

Several years ago Jeff Wood at the national nonprofit Reconnecting America started compiling and sending out news stories he thought would be of interest to colleagues, friends, other bloggers, planners and policy wonks. In the beginning most of the stories were about public transportation, then he added stories about urban planning and design, and development near public transportation. Then the mix was broadened to include a array of stories about cities and urban issues, the environment and ecology, and including research papers and reports, and he listed upcoming conference and events as well.

The audience kept getting bigger, the sources kept broadening, and the mix of topics kept getting richer as this country’s fascination with cities continued to grow. And he always included a quote of the day that reflected the thoughts of urban dwellers. Today, for example, from the Guardian UK: “Virtually no country has graduated to a high-income status without urbanizing, and urbanization rates above 70% are typically found in high-income countries.”

Why are we so fascinated with cities? In 1990 just 10 percent of the world’s population lived in cities but by 2008, the urban population had increased to more that 50 percent and it continues to grow. In the United States today 29 percent of the land mass is covered by cities, but almost 85 percent of the population lives in cities and 93 percent of the economic output is produced there.

Now Jeff has his own website that serves as an archives for this study of cities. And you can read it here. (Or, you can sign up and it’s delivered to your email box daily.)

President Obama's Fascal Year 2014 budget recommends that the Westside Subway and Regional Connector receive $130 million in New Starts funding — a down payment on a broader federal funding agreement of over $2 billion (for these two projects) that Metro hopes to conclude with the federal government by the end of this calendar year. LA Metro Federal Affairs Director Raffi Haig Hamparian says LA advocates have played a key role in securing funding for Metro's projects, citing the LA Area Chamber of Commerce's annual trips to Washington DC, several of which have been led by LA Mayor Antonio Villaraigosa, as one particularly helpful example.

Raffi says that with the funding recommended in the President's Budget LA Metro will effectively "double our historical receipt of federal New Starts funds. And after we secure our formal agreement for both projects later this year we should nearly triple ($200 million annually) our receipt of New Starts funding. That is a result to be proud of and a dividend of the strong partnership we have and continue to maintain with the L.A. Area Chamber and other key stakeholders in L.A. County."

"Here with your daily dose of infrastructure porn is XKCD's Randall Munroe, who's gone and rounded up all of North America's various subway systems and combined them into one big interconnected map," Robert Gonzalez blogs on io9.com.

Just makes you wonder: WHAT IF? There's more here including info on subway systems worldwide, etc.

Denny Zane was quoted in the LA Times on Sunday, noting that eight bills to reduce the voter threshold have been introduced into the state Legislature, and that five of the eight would reduce the threshold for transportation projects. The story was about an LA Times analysis showing that a minority of voters "living in a daisy chain of small, suburban and relatively upscale enclaves around the county's outer rim were largely responsible for last fall's razor thin defeat" of an extension of the Measure R transit tax. The story points out that regions such as the South Bay, with higher concentrations of staunchly anti-tax voters, played a decisive role in defeating the proposal, while urban core communities voted for the tax extension.

The story notes several senior politicians in LA — including LA Mayor Antonio Villaraigosa and LA County Supervisor Zev Yaroslavsky and both mayoral candidates Eric Garcetti and Wendy Greuel — Villaraigosa has said that he'll continue his campaign to accelerate LA's transt projects.

Read more in the LA Times.

The state agency building one of the largest infrastructure projects in state history has filed a lawsuit against anyone standing in its way. In "High-Speed Rail Authority v. All Persons Interested" the California High Speed Rail Authority is taking advantage of an obscure state law allowing state agencies to consolidate all potential lawsuits into a single case, after which no one is able to take legal action.

Many of the legal issues that could potentially derail the project's financing go back to the wording of the 2008 ballot measure that approved the projects, which called for a high speed rail train that would travel on its own tracks between San Francisco and LA in less than 2 hours and 40 minutes. In an effort to reduce the costs the agency has shifted toward a "blended" approach in which the high speed train would run at slower speeds on commuter rail tracks as it nears these cities.

Read more on the Huffington Post.