The California Strategic Growth Plan
Transportation

Boosted by voter approval of Propositions 1A and 1B in 2006, investment in long-overdue transportation improvements will help overcome decades of chronic underinvestment in one of the state's most important economic assets.

The inadequacies of California's current funding methods have contributed to the underinvestment in the state's transportation network. Per-gallon taxes on gasoline and diesel fuel and truck weight fees are the dominant sources of funding for transportation system maintenance and expansion. While increasing vehicle efficiency over the years provides valuable energy and environmental benefits, declining revenues per vehicle mile traveled, coupled with inflation and skyrocketing construction costs, have caused revenue sources to fall short of the state's transportation system's needs. Consequently, chronic underinvestment has increased congestion and has resulted in California having some of the most distressed highway and road conditions in the United States.

Part of the gap has been filled with voter-approved local-option sales taxes and the Proposition 42 sales tax on gasoline. In addition, passage of Proposition 1A by California voters in November 2006 ensures that Proposition 42 revenues will be directed solely for transportation purposes. However, these sources are far from sufficient. Between 1994, when gas tax rates were last adjusted, and 2005-06, travel on the State Highway System increased by 27 percent, from 144.2 billion to 183.4 billion vehicle miles traveled. Similarly, vehicle miles traveled on local streets and roads increased 12 percent over the same period from 127.6 billion to 143 billion. Collectively, state highways and local streets and roads support nearly 20 percent more traffic today than just 12 years ago.

Over the same time frame, while state gas tax revenues have increased about 21 percent, transportation system construction costs have far exceeded inflation. The California Highway Construction Cost Index compiled by Caltrans shows that actual construction costs have increased by 200 percent in the same period. As shown in Figure INF-02, the ongoing revenue shortfall for both new construction and maintenance at the state and local levels has caused the state's transportation system to fall further and further behind each year relative to needed improvements.

The approval by voters of Proposition 1A and the $19.9 billion transportation bond measure of Proposition 1B in November 2006 provides a substantial down payment on meeting California's long-term transportation needs over the next ten years.


PROPOSITION 1B AUTHORIZES THE FOLLOWING PROGRAMS:
  • Congestion relief (corridor mobility) - $4.5 billion to expand capacity and improve travel times in high-congestion travel corridors.
  • Local transit and intercity rail - $4.0 billion for public transit, intercity and commuter rail, and waterborne transit operations.
  • Goods movement - $3.1 billion to relieve traffic congestion along major trade corridors, improve freight rail facilities, and enhance the movement of goods from port to marketplace. This includes $1.0 billion for air quality improvements that will reduce emissions and greenhouse gases from activities related to port operations and freight movement. $100 million is for port security improvements. The SGP proposes that these goods movement funds be used to attract at least $10 billion of private investment and other funding.
  • State Transportation Improvement Program - $2.0 billion to augment funds for this existing program that provides capital funding allocated on a formula basis to every region of the state.
  • State Route 99 - $1.0 billion for improvements to this 400-mile highway through the heart of the Central Valley.
  • Local streets and roads - $2.0 billion for improvements to local transportation facilities to construct, repair and rehabilitate streets and roads.
  • Transit safety, security, and disaster response - $1.0 billion to improve protection against security and safety threats and to increase the capacity of transit operations to move people, goods, emergency personnel, and equipment during and after a disaster.
  • State-Local Partnership - $1.0 billion to match local agencies that raise new funds for transportation projects.
  • Highway rehabilitation and operational improvements - $750 million for highway safety, rehabilitation, and pavement preservation projects. This amount includes $250 million for traffic light synchronization projects and other technology-based improvements to enhance safety operations and the capacity of local streets and roads.
  • School bus retrofit and replacement - $200 million to reduce air pollution and minimize children's exposure to diesel exhaust.
  • Local bridge seismic projects - $125 million to complete seismic retrofits or replacements of local bridges, ramps, and overpasses.
  • Railroad grade crossings - $250 million for improvements to railroad crossings and the construction of bridges over rail lines.
Chapters 181, 313, and 314, Statutes of 2007 (SB 88, AB 193, and AB 196), 2007 Budget Act trailer bills, provided the statutory framework for most of these Proposition 1B bond programs. The 2007 Budget Act and related trailer bills appropriated a total of $4.2 billion in Proposition 1B funding, and the 2008-09 Governor's Budget proposes a total of $4.7 billion in appropriations. The California Transportation Commission has already scheduled resources for projects under four of the major bond programs, and has adopted guidelines that will enable projects to be scheduled in the near future for two others.

These new resources will be used in conjunction with existing transportation revenues from state and federal gas taxes, weight fees, tribal gaming funds, and Proposition 42 funds totaling $9.96 billion in capital spending in 2008-09. In the next ten years, the transportation component of the SGP is projected to result in 550 new High Occupancy Vehicle lanes, 750 new highway lane-miles, 9,000 miles of rehabilitated lanes, 600 miles of new commuter lines, 310,000 more transit riders, and a 150-percent increase in intercity rail riders.


MAINTAINING WHAT WE BUILD
While the bonds and the funds they can leverage will provide substantial congestion relief, state and local needs for maintenance, rehabilitation and operation cannot be adequately funded with currently available resources. State-owned highway miles needing repair have increased from roughly 21 percent of the total system in 2001 to 27 percent in 2007, and could increase to 40 percent by 2015-16 unless planned efforts to focus existing resources on pavement rehabilitation are undertaken. Even when these planned actions are implemented, however, about a third of the State Highway System will remain in distress unless additional resources are identified. Local street and road maintenance backlogs of many billions of dollars reportedly exist and are growing. The CalTrans State Highway Operations and Protection Program (SHOPP) does not have sufficient resources to adequately and effectively operate and preserve the State Highway System. Most of the funds made available under Proposition 1B and Proposition 42 cannot be used for these purposes. Fuel tax revenues, which are the primary source of funding for these purposes, are likely to increase slowly or actually decline with the growing use of alternative fuels and increasing fuel efficiency in new vehicles. As the SGP is implemented, the Administration will work with interested parties and the Legislature to develop more information about the scope of the problem and long-term solutions.


HIGH SPEED RAIL
The High-Speed Rail Authority is charged with planning the development and implementation of an intercity high-speed rail service. The Budget proposes to continue the current level of funding of $1.2 million for basic staff support.

High speed rail in California can ultimately provide a network of ultra-fast rail lines that is a viable and important transportation alternative to address the transportation concerns of California in the next 20 to 30 years. California has been working on high-speed rail for more than ten years now, and to date California taxpayers have borne 100 percent of the project costs, even though their ultimate participation should not exceed 33 percent of the total project cost. In fact, California taxpayers have already spent more than $40 million on planning, consultants and other costs. The plan placed before the voters must demonstrate the financial feasibility of the project and the commitment of federal, state, local, and private participants.

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CHAPTER HIGHLIGHTS for The California Strategic Growth Plan Back to Top

 Strategic Growth Coordination and Sustainability
 Providing Performance Based Infrastructure (PBI)
 Flood Control and Water Supply
 K-12 Education
 Higher Education
image of black pointing arrowTransportation
 Judicial
 Housing
 Public Safety
 Other Public Service
 Accountability
 Affordability

PRINTABLE BUDGET DOCUMENTS Back to Top
Budget Summary - The California Strategic Growth Plan (pdf * - 279K) -
Provides this entire The California Strategic Growth Plan Chapter in pdf format.