BILL NUMBER: AB 105	CHAPTERED
	BILL TEXT

	CHAPTER  6
	FILED WITH SECRETARY OF STATE  MARCH 24, 2011
	APPROVED BY GOVERNOR  MARCH 24, 2011
	PASSED THE SENATE  MARCH 16, 2011
	PASSED THE ASSEMBLY  MARCH 16, 2011
	AMENDED IN SENATE  MARCH 16, 2011
	AMENDED IN SENATE  MARCH 14, 2011

INTRODUCED BY   Committee on Budget (Blumenfield (Chair), Alejo,
Allen, Brownley, Buchanan, Butler, Cedillo, Chesbro, Dickinson,
Feuer, Gordon, Huffman, Mitchell, Monning, and Swanson)

                        JANUARY 10, 2011

   An act to amend Sections 8879.52, 8879.61, 8879.65, 14556.7, and
16965 of the Government Code, to amend Sections 99312, 99315, and
185024 of, and to add Sections 99312.1 and 99312.2 to, the Public
Utilities Code, to repeal Section 7102.1 of, and to repeal and add
Sections 6051.8, 6201.8, 6357.3, 6357.7, 6480.1, 7360, 7361.1,
7653.1, and 60050 of, the Revenue and Taxation Code, to amend
Sections 167, 183.1, and 2103 of, and to add Section 183.2 to, the
Streets and Highways Code, and to amend Section 12811 of, and to add
Section 9400.4 to, the Vehicle Code, relating to transportation,
making an appropriation therefor, and declaring the urgency thereof,
to take effect immediately.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 105, Committee on Budget. Transportation.
   (1) Existing law provides for payment of current general
obligation bond debt service for specified voter-approved
transportation bonds from gasoline excise tax revenue in the Highway
Users Tax Account and revenue in the Public Transportation Account,
and requires the Controller to make specified transfers of revenues
in that regard to the Transportation Debt Service Fund. Existing law,
pursuant to the Budget Act of 2010, provides for a loan of
$761,639,000 from gasoline excise tax revenue in the Highway Users
Tax Account to the General Fund, to be repaid with interest by June
30, 2013.
   Proposition 22, approved by the voters on November 2, 2010, amends
the California Constitution to, among other things, impose new
restrictions on the use of fuel excise tax revenues allocated to the
state and revenues deposited in the Public Transportation Account.
   This bill, in fiscal years 2010-11 and 2011-12, would require the
Controller to transfer specified amounts of revenues deposited in the
State Highway Account from vehicle weight fees to the Transportation
Debt Service Fund to be used for reimbursement of the General Fund
for payment of current general obligation bond debt service for
specified voter-approved transportation bonds, in lieu of the
previously authorized gasoline excise tax revenues and Public
Transportation Account revenues. In subsequent years, the bill would
require all vehicle weight fee revenues to be transferred for this
purpose. The bill would make appropriations in this regard. The bill
would require the Department of Finance to notify the Controller of
the amount of debt service relating to expenditures for eligible mass
transit guideway projects that may be paid from revenues restricted
by Article XIX of the California Constitution.
   This bill, in fiscal year 2010-11, would require the Controller to
transfer specified amounts of revenues deposited in the State
Highway Account from vehicle weight fees to the General Fund as a
loan, in lieu of the previously authorized loan of gasoline excise
tax revenues. The loan amount for 2010-11 would be repaid over 3
years beginning on June 30, 2014. The bill would also authorize an
additional loan in fiscal year 2011-12 of specified vehicle weight
fee revenues, to be repaid by June 30, 2015. The bill would make
appropriations in this regard.
   This bill would require the Controller to take various other
conforming actions as of November 2, 2010, due to voter approval of
Proposition 22 and to the extent the Controller has previously taken
actions inconsistent with the requirements imposed by this bill.
   (2) Existing law, in the 2011-12 fiscal year, requires certain
revenues deposited in the State Highway Account that are not
restricted as to expenditure by Article XIX of the California
Constitution to be transferred to the Transportation Debt Service
Fund for payment of current year debt service on certain mass
transportation bonds. Thereafter, these revenues are to be
transferred to the Public Transportation Account.
   This bill would, instead, transfer these revenues to the
Transportation Debt Service Fund for payment of current year debt
service on certain mass transportation bonds in the 2011-12 and
2012-13 fiscal years. Beginning in 2013-14, these revenues would be
retained in the State Highway Account until appropriated by the
Legislature.
   (3) Proposition 26, approved by the voters on November 2, 2010,
amends the California Constitution to, among other things, require a
2/3 vote of both houses of the Legislature for any change in statute
that results in any taxpayer paying a higher tax. Proposition 26 also
provides that any tax adopted after January 1, 2010, but prior to
November 3, 2010, that was not adopted in compliance with the 2/3
vote requirement shall be void on November 3, 2011, unless the tax is
reenacted by the Legislature with a 2/3 vote.
   Existing law, as of July 1, 2010, eliminates the state sales and
use tax on motor vehicle fuel (gasoline) and increases the excise
tax. Existing law, as of July 1, 2011, increases the sales and use
tax on diesel and decreases the excise tax. Existing law requires the
State Board of Equalization to annually modify both the gasoline and
diesel excise tax rates on a going-forward basis so that the various
changes in the taxes imposed on gasoline and diesel, as described
above, are revenue neutral. Existing law enacts other provisions
related to the implementation of these provisions.
   This bill would repeal all of these provisions. The bill would
enact new, similar replacement provisions, and state the intent of
the Legislature that the changes are being made in order to comply
with Proposition 26. The bill would also increase the new diesel
sales and use tax rates to be applicable in fiscal years 2011-12,
2012-13, and 2013-14 above the rates currently in effect that the
bill would repeal. These increases in the diesel sales and use tax
rates would be offset by a reduction in the diesel excise tax rate as
of July 1, 2011, and a requirement for the State Board of
Equalization to adjust diesel excise tax rates on a going-forward
basis to ensure that the overall changes in these diesel fuel taxes
are revenue neutral.
   (4) Existing statutory law provides that 75% of diesel sales tax
revenues at the 4 % rate are to be allocated by the Controller from
the Public Transportation Account to local agencies for public
transportation purposes pursuant to the State Transit Assistance
Program, with the remaining 25% of revenues to made available for
mass transit programs at the state level. Proposition 22, approved by
the voters on November 2, 2010, amends the California Constitution
to require these Public Transportation Account revenues to be divided
equally between the State Transit Assistance Program and the
state-level programs.
   This bill would conform the statutory provisions to the
requirements of Proposition 22. The bill would appropriate
$23,000,000 to the Controller from the Public Transportation Account
in the 2011-12 fiscal year for allocation to the State Transit
Assistance Program. The bill would also continuously appropriate all
of the diesel sales revenues above the 4 % rate to the Controller
for allocation to that program.
   (5) Existing law provides for a loan of $135,000,000 from the
State Highway Account to the General Fund that is to be repaid by
June 30, 2012.
   This bill would instead require that loan to be repaid by June 30,
2013.
   (6) Existing law, until July 1, 2011, authorizes the Department of
Transportation to transfer funds as short-term loans between various
transportation accounts.
   This bill would extend the operation of these provisions until
July 1, 2014. The bill would also eliminate the authority of the
department to transfer funds as short-term loans to and from the
Transportation Investment Fund, the Transportation Deferred
Investment Fund, and the Public Transportation Account.
   (7) Existing law creates the California Transportation Commission,
with various duties and responsibilities relative to the programming
and allocation of funds for transportation capital projects.
Existing law requires the commission to submit, by December 15 of
each year, an annual report to the Legislature summarizing the
commission's prior-year decisions in allocating transportation
capital funds and identifying timely and relevant transportation
issues facing the state. Existing law, the Highway Safety, Traffic
Reduction, Air Quality, and Port Security Bond Act of 2006,
authorizes the issuance of $19.25 billion of general obligation bonds
for specified purposes, including $2 billion to be transferred to
the Trade Corridors Improvement Fund to be available, upon
appropriation in the annual Budget Act by the Legislature and subject
to such conditions and criteria as the Legislature may provide by
statute, for allocation by the commission. Existing law requires the
Department of Transportation to, on or before February 18, 2009,
report to specified committees of the Legislature a summary of any
memorandum of understanding or any other agreement executed between a
railroad company and any state or local transportation agency
relative to any project funded with moneys allocated from the Trade
Corridors Improvement Fund.
   This bill would instead require the commission to provide that
report to specified committees of the Legislature within 30 days of
receiving such a memorandum of understanding or executed agreement.
The bill would also, commencing January 1, 2012, require the
commission to provide semiannual reports to those committees on the
status of all railroad projects programmed in the Trade Corridors
Improvement Fund program. The bill would make these reporting
requirements inoperative on January 1, 2015.
   (8) The Highway Safety, Traffic Reduction, Air Quality, and Port
Security Bond Act of 2006 also requires that $1 billion of bond funds
be deposited in the Transit System Safety, Security, and Disaster
Response Account, administered by the California Emergency Management
Agency (Cal EMA), for capital projects that provide increased
protection against a security and safety threat, and for capital
expenditures to increase the capacity of transit operators to develop
disaster response transportation systems, as specified. Existing law
requires 25% of available funds to be allocated to certain regional
public waterborne transit agencies. Existing law requires entities
receiving funds from that account to expend those funds within 3
fiscal years of the fiscal year in which the funds were allocated and
requires that funds remaining unexpended after those 3 years revert
to Cal EMA for reallocation in subsequent fiscal years.
   This bill, notwithstanding these provisions, would provide that
entities receiving an allocation of the funds set aside for regional
public waterborne transit agencies, relative to allocations of funds
made prior to June 30, 2011, shall have 4 fiscal years from the last
day of the fiscal year in which the funds were received by that
entity to expend those funds.
   (9) Existing law requires funds from the Local Street and Road
Improvement, Congestion Relief, and Traffic Safety Account of 2006 to
be made available to the Controller for allocation to cities,
counties, and a city and county, for purposes of the Highway Safety,
Traffic Reduction, Air Quality, and Port Security Bond Act of 2006,
as specified. Upon receipt of funds, a city, county, or city and
county is required to expend those funds within 3 fiscal years from
the date that the funds are allocated to it by the Controller, and
any funds not expended within that period are required to be returned
to the Controller and reallocated to other cities, counties, or a
city and county, as specified.
   Existing law establishes the Highway Users Tax Account in the
Transportation Tax Fund with revenues in the account restricted to
expenditure on various purposes, including public street and highway
purposes and certain mass transit guideway purposes.
   This bill would authorize a city, county, or city and county that
receives these funds in a fiscal year in which funds from the Highway
Users Tax Account are deferred, suspended, borrowed, or shifted, to
expend those funds within 4 fiscal years from the last date of the
fiscal year in which the funds are allocated to it by the Controller.

   (10) Existing law, the California High-Speed Rail Act, creates the
High-Speed Rail Authority to develop and implement a high-speed rail
system in the state, with specified powers and duties. Existing law
provides for appointment of an executive director by the authority,
who is exempt from civil service and serves at the pleasure of the
authority. Existing law requires the executive director to be paid a
salary established by the authority and approved by the Department of
Personnel Administration.
   This bill, for purposes of managing and administering the ongoing
work of the authority in implementing the high-speed train project,
would authorize the Governor, upon the recommendation of the
executive director, to appoint up to 6 additional individuals, exempt
from civil service, who would serve in specified positions at the
pleasure of the executive director. The bill would require a salary
survey to be conducted to determine the compensation for the
executive director and additional exempt persons, and would require
the salaries to be established by the authority and approved by the
Department of Personnel Administration.
   This bill would impose certain reporting requirements on the
authority with respect to a portion of funds appropriated to the
authority in the 2010 and 2011 Budget Acts, to be submitted to the
Joint Legislative Budget Committee.
   (11) Existing law provides that the Department of Transportation
has full possession and control of the state highway system. Existing
law creates various programs to fund transportation capital
improvement programs and provides for allocation of those funds.
Existing law requires the department to prepare an annual budget, as
specified, for submission to the Governor.
   This bill would require the department to submit specified
supplemental information by May 1 of each year to the Legislative
Analyst and to the Senate Committee on Appropriations and the
Assembly Committee on Appropriations to substantiate the department's
proposed capital outlay support budget.
   (12) Existing law provides for apportionment by the Controller of
a specified amount of gasoline excise tax revenues in the Highway
Users Tax Account to cities and counties for local street and road
purposes, including revenues from the increase in the gasoline excise
tax, pursuant to Chapters 11 and 12 of the 8th Extraordinary Session
of the Statutes of 2010. These revenues, including the revenues from
the increase in the gasoline excise tax, are not subject to
expenditure requirements and restrictions that were applicable to
revenues from the gasoline sales tax that was repealed by the
above-referenced legislation.
   This bill would clarify that the revenues apportioned to cities
and counties from the increase in the gasoline excise tax may be used
for any local street and road purpose and are not subject to the
requirements and restrictions applicable to the former gasoline sales
tax revenues.
   (13) Under existing law, when the Department of Motor Vehicles
determines that an applicant is lawfully entitled to a driver's
license, the department is required to issue that license to the
applicant. Existing law specifies the contents of a driver's license.
Existing law requires that the front of an application for an
original or renewal of a driver's license or identification card
contain a space for an applicant to give his or her consent to be an
organ and tissue donor upon death.
   This bill would also require the application for a driver's
license or identification card to contain a space for an applicant to
indicate whether he or she has served in the Armed Forces of the
United States and to give his or her consent to be contacted
regarding eligibility to receive state or federal veterans benefits.
The bill would require the Department of Motor Vehicles to
electronically transmit to the Department of Veterans Affairs
specified information on an applicant who has identified on his or
her application for a driver's license or identification card that he
or she has served in the Armed Forces of the United States and
consents to being contacted about veterans benefits.
   (14) The bill would enact other related provisions.
   (15) The California Constitution authorizes the Governor to
declare a fiscal emergency and to call the Legislature into special
session for that purpose. Governor Schwarzenegger issued a
proclamation declaring a fiscal emergency, and calling a special
session for this purpose, on December 6, 2010. Governor Brown issued
a proclamation on January 20, 2011, declaring and reaffirming that a
fiscal emergency exists and stating that his proclamation supersedes
the earlier proclamation for purposes of that constitutional
provision.
   This bill would state that it addresses the fiscal emergency
declared and reaffirmed by the Governor by proclamation issued on
January 20, 2011, pursuant to the California Constitution.
   (16) This bill would declare that it is to take effect immediately
as an urgency statute.
   Appropriation: yes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  It is the intent of the Legislature to reenact the
"fuel tax swap," as originally enacted by Assembly Bill 6 of the
2009-10 Eighth Extraordinary Session and subsequently modified by
Senate Bill 70 of the 2009-10 Regular Session, and as further
modified herein, with a two-thirds vote of each house of the
Legislature pursuant to the requirements of Proposition 26, as
approved by the voters at the November 2, 2010, statewide General
Election.
  SEC. 2.  Section 8879.52 of the Government Code is amended to read:

   8879.52.  (a) The commission shall evaluate, consistent with the
commission's Trade Corridors Improvement Fund (TCIF) Guidelines,
adopted November 27, 2007, as part of the 2010 TCIF review, the total
potential costs and total potential economic and noneconomic
benefits of the program to California's economy, environment, and
public health. The commission shall consult with the State Air
Resources Board in order to utilize the appropriate models,
techniques, and methods to develop the evaluation required by this
subdivision.
   (b) With respect to the two billion dollars ($2,000,000,000)
appropriated from the TCIF, as described in paragraph (1) of
subdivision (c) of Section 8879.23, and the five hundred million
dollars ($500,000,000) to be made available from the State Highway
Account, the following programming schedule shall apply:
   (1) The Los Angeles/Inland Empire Corridor shall receive a minimum
of one billion five hundred million dollars ($1,500,000,000).
   (2) The San Diego/International Border Corridor shall receive a
minimum of two hundred fifty million dollars ($250,000,000).
   (3) The San Francisco Bay/Central Valley Corridor shall receive a
minimum of six hundred forty million dollars ($640,000,000).
   (4) Other corridors, as determined by the commission, shall
receive a minimum of sixty million dollars ($60,000,000).
   (c) The corridors referenced in subdivision (b) shall receive the
minimum amount of funding programmed for that corridor
notwithstanding the deprogramming of any project or projects in that
corridor by the commission. If a project is or projects are
deprogrammed, the commission shall collaborate with the local
transportation agencies in that corridor to select another project or
projects for programming of those funds within the minimum amount
provided to each corridor pursuant to subdivision (b).
   (d) If the Colton Crossing project programmed in the commission's
TCIF Program as of April 10, 2008, does not meet the requirements or
delivery schedule contained in its project baseline agreement when
reviewed by the commission no later than March 2010, the project
shall be ineligible to receive an allocation from the TCIF. The
ninety-seven million dollars ($97,000,000) associated with the
project shall then be available for programming in the Los
Angeles/Inland Empire Corridor. In that event, the commission shall
collaborate with the local transportation agencies in that corridor
to select another project or projects for programming of those funds,
and, in making that selection, shall take into consideration the Los
Angeles/Inland Empire Corridor Tier One or Tier Two Project Lists
and any other project identified by the local agencies. Projects
currently receiving TCIF funding shall not be considered for
selection.
   (e) (1) The commission shall report to the Assembly Committee on
Transportation, the Senate Committee on Transportation and Housing,
the Senate Committee on Budget and Fiscal Review, the Assembly
Committee on Budget, the Senate Committee on Appropriations, and the
Assembly Committee on Appropriations a summary of any memorandum of
understanding, along with a copy of the memorandum, or any agreement
executed between a railroad company and any state or local
transportation agency as it relates to any project funded with moneys
allocated from the TCIF within 30 days of the commission's receipt
of those documents.
   (2) Commencing January 1, 2012, the commission shall provide
semiannual reports to the Assembly Committee on Transportation, the
Senate Committee on Transportation and Housing, the Senate Committee
on Budget and Fiscal Review, the Assembly Committee on Budget, the
Senate Committee on Appropriations, and the Assembly Committee on
Appropriations on the status of all railroad projects programmed in
the TCIF program.
   (3) This subdivision shall become inoperative on January 1, 2015,
pursuant to Section 10231.5.
  SEC. 3.  Section 8879.61 of the Government Code is amended to read:

   8879.61.  (a) (1) Entities described in subdivisions (a), (b), and
(c) of Section 8879.57 receiving an allocation of funds pursuant to
this article shall expend those funds within three fiscal years of
the fiscal year in which the funds were allocated. Funds remaining
unexpended thereafter shall revert to the California Emergency
Management Agency for reallocation under this article in subsequent
fiscal years.
   (2) Notwithstanding paragraph (1), for an allocation of funds made
prior to June 30, 2011, to an entity described in subdivision (b) of
Section 8879.57, that entity shall have four fiscal years from the
last day of the fiscal year in which the funds were received by that
entity to expend those funds.
   (b) Entities that receive grant awards from funds allocated
pursuant to subdivisions (b) or (c) of Section 8879.57 are not
eligible to receive awards from the funds allocated pursuant to
subdivision (a) of Section 8879.57.
   (c) Funds appropriated for the program established by this article
in the Budget Act of 2007 shall be allocated consistent with the
allocation schedule established in Section 8879.57.
  SEC. 4.  Section 8879.65 of the Government Code is amended to read:

   8879.65.  (a) Funds appropriated from the Local Street and Road
Improvement, Congestion Relief, and Traffic Safety Account of 2006,
established by subdivision (l) of Section 8879.23, shall be made
available to the Controller for allocation to cities, counties, and a
city and county. From bond funds appropriated in the 2007-08 fiscal
year for cities, including a city and county, each city, and city and
county, shall receive at least a minimum allocation of four hundred
thousand dollars ($400,000), as described in subparagraph (B) of
paragraph (1) of subdivision (l) of Section 8879.23. The remainder of
the funds appropriated for cities, including a city and county,
shall be allocated in the proportion described in subparagraph (B) of
paragraph (1) of subdivision (l) of Section 8879.23. In no case
shall a city, or a city and county, receive an allocation in excess
of its total share, as described in subdivision (l) of Section
8879.23, except as described in subdivision (d).
   (b) Prior to receiving an allocation of funds from the Controller
in a fiscal year, an eligible local agency shall submit to the
Department of Finance a list of projects expected to be funded with
bond funds pursuant to an adopted city, county, or city and county
budget. All projects proposed to be funded with funds from the
account shall be included in a city, county, or city and county
budget that is adopted by the applicable city council or board of
supervisors at a regular public meeting. The list of projects
expected to be funded with bond funds shall include a description and
the location of the proposed project, a proposed schedule for the
project's completion, and the estimated useful life of the
improvement. The project list shall not limit the flexibility of an
eligible local agency to fund projects in accordance with local needs
and priorities so long as the projects are consistent with
subparagraph (B) of paragraph (1) of subdivision (l) of Section
8879.23.
   (1) The Department of Finance shall report monthly to the
Controller the eligible local agencies that have submitted a list of
projects as described in this subdivision.
   (2) Upon receipt of the information described in paragraph (1),
the Controller shall allocate funds to those agencies that have
submitted a list of projects, as reported by the Department of
Finance.
   (c) Each fiscal year upon expending funds from the account, a
city, county, or city and county shall submit documentation to the
Department of Finance which includes a description and location of
each completed project, the amount of funds expended on the project,
the completion date, and the project's estimated useful life. The
documentation shall be forwarded to the department, in a manner and
form approved by the department, at the end of each fiscal year until
the funds in the account are exhausted. The department may post the
information contained in the documentation on the department's
official Web site.
   (d) (1) A city, county, or city and county receiving funds
pursuant to this section shall have three fiscal years to expend the
funds following the fiscal year in which the allocation was made by
the Controller, and any funds not expended within that period shall
be returned to the Controller and be reallocated to other cities,
counties, or a city and county, as applicable, pursuant to the
allocation formulas set forth in subparagraph (A) or (B) of paragraph
(1) of subdivision (l) of Section 8879.23, but excluding the
requirement for a minimum city allocation as described in
subparagraph (B) of paragraph (1) of that subdivision and section.
   (2) Notwithstanding paragraph (1), a city, county, or city and
county receiving funds pursuant to this section, during any fiscal
year in which funds from the Highway Users Tax Account are deferred,
suspended, borrowed, or shifted, shall have four fiscal years from
the last date of the fiscal year in which the funds are allocated to
it by the Controller to expend the funds.
   (e) Subject to the requirements and conditions of this section, it
is the intent of the Legislature to appropriate funds from the
account so that the Controller may allocate the balance of these
funds to eligible local agencies over the next four years, following
the 2007-08 fiscal year. Nothing in this section shall prevent the
Legislature from appropriating funds on a more expedited basis based
on local agency need.
   (f) The sum of three hundred fifty million dollars ($350,000,000)
is hereby appropriated from funds in the Local Street and Road
Improvement, Congestion Relief, and Traffic Safety Account of 2006
created pursuant to subdivision (l) of Section 8879.23, for
allocation pursuant to this article, as an augmentation to the amount
appropriated in Item 9350-104-6065 of the Budget Act of 2007. The
total 2007-08 fiscal year appropriation of nine hundred fifty million
dollars ($950,000,000) shall be allocated as follows: four hundred
million dollars ($400,000,000) to counties and five hundred fifty
million dollars ($550,000,000) to cities.
   (g) Notwithstanding the provisions of Item 9350-104-6065 of the
Budget Act of 2008, a city or city and county that receives any
portion of the funds appropriated by that item shall agree to
encumber the funds before July 1, 2010.
  SEC. 5.  Section 14556.7 of the Government Code is amended to read:

   14556.7.  (a) To provide adequate cash for projects, including,
but not limited to, projects in the State Transportation Improvement
Program, the State Highway Operation and Protection Program, and the
Traffic Congestion Relief Program, and for the support of the
department, the department may transfer funds as short-term loans
among and between the State Highway Account in the State
Transportation Fund and the Traffic Congestion Relief Fund (TCRF),
subject to those terms and conditions that the Director of Finance
may impose upon those transfers. When loan balances authorized in
this subdivision are outstanding, the Director of Transportation
shall report the amounts of loans outstanding with respect to each
fund or account as of the last business day of each quarter to the
commission. The commission shall monitor the cashflow loan program
authorized in this section and shall provide guidance to the
department to ensure that sufficient resources will be available for
all projects and all other authorized expenditures from each fund or
account so as to not delay any authorized expenditure.
   (b) For the purposes of this section, a "short-term loan" is a
transfer that is made subject to the following conditions:
   (1) That any amount loaned is to be repaid in full to the fund or
account from which it was loaned during the same fiscal year in which
the loan was made, except that repayment may be delayed until a date
not more than 30 days after the date of enactment of the annual
Budget Act for the subsequent fiscal year.
   (2) That loans shall be repaid whenever the funds are needed to
meet cash expenditure needs in the loaning fund or account.
   (c) This section shall become inoperative on July 1, 2014, and, as
of January 1, 2015, is repealed, unless a later enacted statute,
that becomes operative on or before January 1, 2015, deletes or
extends the dates on which it becomes inoperative and is repealed.
  SEC. 6.  Section 16965 of the Government Code is amended to read:
   16965.  (a) The Transportation Debt Service Fund is hereby created
in the State Treasury. Moneys in the fund shall, among other things,
as provided in this section, be dedicated to payment of debt service
on bonds including bonds issued pursuant to the Clean Air and
Transportation Improvement Act of 1990 (Part 11.5 (commencing with
Section 99600) of Division 10 of the Public Utilities Code), the
Passenger Rail and Clean Air Bond Act of 1990 (Chapter 17 (commencing
with Section 2701) of Division 3 of the Streets and Highways Code),
the Seismic Retrofit Bond Act of 1996 (Chapter 12.48 (commencing with
Section 8879) of Division 1 of Title 2), the Highway Safety, Traffic
Reduction, Air Quality, and Port Security Bond Act of 2006 (Chapter
12.49 (commencing with Section 8879.20) of Division 1 of Title 2),
and the Safe, Reliable High-Speed Passenger Train Bond Act for the
21st Century (Chapter 20 (commencing with Section 2704) of Division 3
of the Streets and Highways Code). If the moneys in the fund are
insufficient to pay the balance of the debt consistent with existing
obligations, the General Fund will be used to pay the balance of any
debt service.
   (b) From moneys transferred to the fund pursuant to an annual
Budget Act or other statute from the State Highway Account in the
State Transportation Fund, the Controller shall transfer as an
expenditure reduction to the General Fund any amount necessary to
offset the cost of current year debt service payments made from the
General Fund during any fiscal year for transportation-related
general obligation bond expenditures consistent with Article XIX of
the California Constitution.
   (c) From moneys transferred to the fund pursuant to Section 2103
of the Streets and Highways Code and subdivisions (a) and (b) of
Section 9400.4 of the Vehicle Code, the Controller shall transfer as
an expenditure reduction to the General Fund any amount necessary to
offset the cost of current year debt service payments made from the
General Fund on any bonds issued pursuant to Proposition 192 (1996)
and three-quarters of the amount of current year debt service
payments made from the General Fund on any bonds issued pursuant to
Proposition 1B (2006).
   (d) From moneys transferred to the fund pursuant to Section 183.1
of the Streets and Highways Code, the Controller shall transfer as an
expenditure reduction to the General Fund any amount necessary to
offset the cost of current year debt service payments made from the
General Fund on any bonds issued pursuant to Proposition 116 (1990).
   (e) From moneys transferred to the fund pursuant to Section 99315
of the Public Utilities Code and subdivisions (a) and (b) of Section
9400.4 of the Vehicle Code, the Controller shall transfer as an
expenditure reduction to the General Fund any amount necessary to
offset the cost of current year debt service payments made from the
General Fund on any bonds issued pursuant to Proposition 108 (1990)
and Proposition 1A (2008), and one-quarter of the amount of current
year debt service payments made from the General Fund on any bonds
issued pursuant to Proposition 1B (2006). The Department of Finance
shall notify the Controller by July 30 of every year of the
percentage of debt service that is expected to be paid in that fiscal
year on bond-funded projects that qualify as eligible guideway
projects consistent with the requirements applicable to the
expenditure of revenues under Article XIX of the California
Constitution.
   (f) On or before the second business day following the date on
which transfers are made to the Transportation Debt Service Fund, the
Controller shall transfer those funds from the fund to the General
Fund pursuant to this section.
  SEC. 7.  Section 99312 of the Public Utilities Code is amended to
read:
   99312.  Except as provided in Sections 99311 and 99311.5, and
Sections 6051.8 and 6201.8 of the Revenue and Taxation Code, and
except as otherwise provided in subdivisions (d) and (e), the funds
in the account shall be made available for the following purposes:
   (a) Fifty percent for purposes of Section 99315, subject to
appropriation by the Legislature.
   (b) To the Controller, 25 percent for allocation to transportation
planning agencies, county transportation commissions, and the San
Diego Metropolitan Transit Development Board pursuant to Section
99314. Commencing with the 2011-12 fiscal year, these funds are
hereby continuously appropriated for purposes of this subdivision.
   (c) To the Controller, 25 percent for allocation to transportation
agencies, county transportation commissions, and the San Diego
Metropolitan Transit Development Board for purposes of Section 99313.
Commencing with the 2011-12 fiscal year, these funds are hereby
continuously appropriated for purposes of this subdivision.
   (d) (1) For the 2009-10 fiscal year, notwithstanding any other
provision of this section or any other provision of law, the sum of
four hundred million dollars ($400,000,000) is hereby appropriated
from the account to the Controller for immediate allocation pursuant
to paragraph (2). These funds are intended to cover the two-year
period of the 2009-10 and 2010-11 fiscal years. The remaining funds
in the account subject to this section shall be available for the
purposes of Section 99315, subject to appropriation by the
Legislature.
   (2) (A) Fifty percent of the amount appropriated to the Controller
pursuant to paragraph (1) shall be allocated to transportation
planning agencies, county transportation commissions, and the San
Diego Metropolitan Transit Development Board pursuant to Section
99314.
   (B) Fifty percent of the amount appropriated to the Controller
pursuant to paragraph (1) shall be allocated to transportation
planning agencies, county transportation commissions, and the San
Diego Metropolitan Transit Development Board pursuant to Section
99313.
   (e) For the 2010-11 fiscal year, notwithstanding any other
provision of this section or any other provision of law, the funds in
the account subject to this section shall be made available only for
purposes of Section 99315, subject to appropriation by the
Legislature.
  SEC. 8.  Section 99312.1 is added to the Public Utilities Code, to
read:
   99312.1.  Revenues transferred to the Public Transportation
Account pursuant to Sections 6051.8 and 6201.8 of the Revenue and
Taxation Code are hereby continuously appropriated to the Controller
for allocation as follows:
   (a) Fifty percent for allocation to transportation planning
agencies, county transportation commissions, and the San Diego
Metropolitan Transit Development Board pursuant to Section 99314.
   (b) Fifty percent for allocation to transportation agencies,
county transportation commissions, and the San Diego Metropolitan
Transit Development Board for purposes of Section 99313.
   For purposes of this chapter, the revenues allocated pursuant to
this section shall be subject to the same requirements as revenues
allocated pursuant to subdivisions (b) and (c), as applicable, of
Section 99312.
  SEC. 9.  Section 99312.2 is added to the Public Utilities Code, to
read:
   99312.2.  Notwithstanding any other provision of law, twenty-three
million dollars ($23,000,000) is hereby appropriated from the Public
Transportation Account to the Controller for allocation to local
agencies for the 2011-12 fiscal year, with eleven million five
hundred thousand dollars ($11,500,000) to be allocated pursuant to
Section 99313 and eleven million five hundred thousand dollars
($11,500,000) to be allocated pursuant to Section 99314. For purposes
of this chapter, the revenues allocated pursuant to this section
shall be subject to the same requirements as revenues allocated
pursuant to subdivisions (b) and (c), as applicable, of Section
99312.
  SEC. 10.  Section 99315 of the Public Utilities Code is amended to
read:
   99315.  Funds made available pursuant to subdivision (a) of
Section 99312 shall be available for all of the following purposes:
   (a) To the department for bus and passenger rail services pursuant
to Sections 14035, 14035.5, and 14038 of the Government Code.
   (b) To the department for funding of public transit capital
improvement projects in the state transportation improvement program,
pursuant to Section 14529 of the Government Code.
   (c) To the department for its planning activities not payable from
the State Highway Account in the State Transportation Fund, its mass
transportation responsibilities, and its assistance in regional
transportation planning.
   (d) To the department for allocation by the director to the
Institute of Transportation Studies of the University of California
for training and research in public transportation systems
engineering and management and coordination with other transportation
modes.
   (e) To the commission for its activities not payable from the
State Highway Account.
   (f) To the Public Utilities Commission for its passenger rail
safety responsibilities specified in statute on commuter rail,
intercity rail, and urban rail transit lines.
   (g) For transfer to the Transportation Debt Service Fund created
by Section 16965 of the Government Code to reimburse the General Fund
for current year debt service payments on rail and transit-related
general obligation bonds other than those issued pursuant to the
Clean Air and Transportation Improvement Act of 1990 (Part 11.5
(commencing with Section 99600)), as follows:
   (1) For the 2009-10 fiscal year, the Controller shall transfer up
to one hundred forty-two million fifty-eight thousand dollars
($142,058,000) to the fund upon order of the Director of Finance for
debt service paid or payable within that fiscal year.
   (2) For the 2010-11 fiscal year, the Controller shall transfer up
to ninety million eight hundred eighty-six thousand dollars
($90,886,000) in revenues collected before November 2, 2010, to the
fund, as follows:
   (A) By the 15th of every month, the Treasurer, in consultation
with the Director of Finance, shall notify the Controller of the
amount of debt service that will be paid on each transportation bond
during that month.
   (B) Within two business days following the 28th of every month,
the Controller shall transfer from the account to the Transportation
Debt Service Fund an amount equal to monthly debt service paid by the
General Fund on any bonds issued pursuant to Proposition 108 (1990)
and Proposition 1A (2008), and one-quarter of the monthly debt
service paid by the General Fund on any bonds issued pursuant to
Proposition 1B (2006).
   (C) Any transfers made from the Public Transportation Account
pursuant to this subdivision for any months after October 2010 shall
be reversed and repaid to the account, and shall instead be made, to
the extent authorized, from weight fee revenues in the State Highway
Account as provided for in Section 9400.4 of the Vehicle Code.
  SEC. 11.  Section 185024 of the Public Utilities Code is amended to
read:
   185024.  (a) The authority shall appoint an executive director,
exempt from civil service, who shall serve at the pleasure of the
authority, to administer the affairs of the authority as directed by
the authority.
   (b) For purposes of managing and administering the ongoing work of
the authority in implementing the high-speed train project, the
Governor, upon the recommendation of the executive director, may
appoint up to six additional individuals, exempt from civil service,
who shall serve at the pleasure of the executive director. Pursuant
to this subdivision, the Governor may appoint persons only for the
following positions:
   (1) Chief program manager.
   (2) Up to three regional directors.
   (3) Chief financial officer.
   (4) Director of risk management and project controls.
   (c) The compensation of the executive director and the additional
persons authorized by subdivision (b) shall be established by the
authority, and approved by the Department of Personnel
Administration, in an amount that is reasonably necessary, in the
discretion of the authority, to attract and hold a person of superior
qualifications. The authority shall cause to be conducted, through
the use of independent outside advisers, a salary survey to determine
the compensation for the positions under this subdivision. The
Department of Personnel Administration may, in its discretion, accept
a previously completed salary survey that meets the requirements of
this subdivision, and shall review the methodology used in the
survey. The salary survey shall consider both of the following:
   (1) Other state, regional, and local transportation agencies that
are most comparable to the authority and its responsibilities.
   (2) Other relevant labor pools.
   The compensation set by the authority shall not exceed the highest
comparable compensation for a position of that type, as determined
by the salary survey. Based on the salary survey, these positions
shall be paid a salary established by the authority and approved by
the Department of Personnel Administration.
   (d) The executive director may, as authorized by the authority,
appoint necessary staff to carry out the provisions of this part.
  SEC. 12.  Section 6051.8 of the Revenue and Taxation Code is
repealed.
  SEC. 13.  Section 6051.8 is added to the Revenue and Taxation Code,
to read:
   6051.8.  (a) Except as provided by Section 6357.3, in addition to
the taxes imposed by this part, for the privilege of selling tangible
personal property at retail a tax is hereby imposed upon all
retailers at the rate of 1.75 percent of the gross receipts of any
retailer from the sale of all diesel fuel, as defined in Section
60022, sold at retail in this state on and after the operative date
of this subdivision.
                                                         (b)
Notwithstanding subdivision (a), for the 2011-12 fiscal year only,
the rate referenced in subdivision (a) shall be 1.87 percent.
   (c) Notwithstanding subdivision (a), for the 2012-13 fiscal year
only, the rate referenced in subdivision (a) shall be 2.17 percent.
   (d) Notwithstanding subdivision (a), for the 2013-14 fiscal year
only, the rate referenced in subdivision (a) shall be 1.94 percent.
   (e) Notwithstanding subdivision (b) of Section 7102, all of the
revenues, less refunds, collected pursuant to this section shall be
estimated by the State Board of Equalization, with the concurrence of
the Department of Finance, and transferred quarterly to the Public
Transportation Account in the State Transportation Fund for
allocation pursuant to Section 99312.1 of the Public Utilities Code.
   (f) Subdivisions (a) to (e), inclusive, shall become operative on
July 1, 2011.
  SEC. 14.  Section 6201.8 of the Revenue and Taxation Code is
repealed.
  SEC. 15.  Section 6201.8 is added to the Revenue and Taxation Code,
to read:
   6201.8.  (a) Except as provided by Section 6357.3, in addition to
the taxes imposed by this part, an excise tax is hereby imposed on
the storage, use, or other consumption in this state of diesel fuel,
as defined in Section 60022, at the rate of 1.75 percent of the sales
price of the diesel fuel on and after the operative date of this
subdivision.
   (b) Notwithstanding subdivision (a), for the 2011-12 fiscal year
only, the rate referenced in subdivision (a) shall be 1.87 percent.
   (c) Notwithstanding subdivision (a), for the 2012-13 fiscal year
only, the rate referenced in subdivision (a) shall be 2.17 percent.
   (d) Notwithstanding subdivision (a), for the 2013-14 fiscal year
only, the rate referenced in subdivision (a) shall be 1.94 percent.
   (e) Notwithstanding subdivision (b) of Section 7102, all of the
revenues, less refunds, collected pursuant to this section shall be
estimated by the State Board of Equalization, with the concurrence of
the Department of Finance, and transferred quarterly to the Public
Transportation Account in the State Transportation Fund for
allocation pursuant to Section 99312.1 of the Public Utilities Code.
   (f) Subdivisions (a) to (e), inclusive, shall become operative on
July 1, 2011.
  SEC. 16.  Section 6357.3 of the Revenue and Taxation Code is
repealed.
  SEC. 17.  Section 6357.3 is added to the Revenue and Taxation Code,
to read:
   6357.3.  (a) On and after July 1, 2011, there are exempted from
the taxes imposed by Sections 6051.8 and 6201.8, the gross receipts
from the sale in this state of, and the storage, use, or other
consumption in this state of both of the following:
   (1) Diesel fuel purchased for use or used in a manner that is
exempt from the tax imposed pursuant to Part 31 (commencing with
Section 60001) of Division 2 and not subject to the backup tax
imposed by Section 60058 or the payment requirement specified in
Section 60108.
   (2) Diesel fuel subject to the payment requirement specified in
Section 60502.2.
   (b) No exemption from the tax imposed pursuant to Sections 6051.8
and 6201.8 shall be allowed under this section unless the purchaser
furnishes the seller with an exemption certificate, completed in
accordance with any instructions or regulations as the board may
prescribe.
   (c) If a purchaser certifies in writing to the seller that the
diesel fuel purchased without payment of the tax imposed pursuant to
Section 6051.8 or 6201.8 will be used in a manner entitling the
seller to regard the gross receipts or sales price from the sale as
exempt from that tax, and uses the diesel fuel in a manner that
subjects the diesel fuel to the tax imposed pursuant to Section
60050, the purchaser shall be liable for payment of the sales tax
imposed pursuant to Section 6051.8, with applicable interest, as if
the purchaser were a retailer making a retail sale of the diesel fuel
at the time the fuel is so used, and the sales price of the diesel
fuel to the purchaser shall be deemed the gross receipts from that
retail sale.
  SEC. 18.  Section 6357.7 of the Revenue and Taxation Code is
repealed.
  SEC. 19.  Section 6357.7 is added to the Revenue and Taxation Code,
to read:
   6357.7.  (a) On and after July 1, 2010, there are exempted from
the taxes imposed by this part, the gross receipts from the sale in
this state of, and the storage, use, or other consumption in this
state of, motor vehicle fuel, as defined in Section 7326.
   (b) (1) Notwithstanding any provision of the Bradley-Burns Uniform
Local Sales and Use Tax Law (Part 1.5 (commencing with Section
7200)) or the Transactions and Use Tax Law (Part 1.6 (commencing with
Section 7251)), the exemption established by this section shall not
apply with respect to any tax levied by a county, city, or district
pursuant to, or in accordance with, either of those laws.
   (2) The exemption established by this section shall not apply with
respect to any tax levied pursuant to Section 6051.2, 6051.5,
6201.2, or 6201.5, or pursuant to Section 35 of Article XIII of the
California Constitution.
   (c) On and after July 1, 2010, the State Board of Equalization and
the Department of Finance shall recognize that the state no longer
receives state sales and use tax revenues from the sale of, and the
storage, use, or other consumption of, motor vehicle fuel for
purposes of any estimates required to be performed under paragraphs
(1) and (2) of subdivision (a) of Section 7102, and Section 7104.2.
  SEC. 20.  Section 6480.1 of the Revenue and Taxation Code is
repealed.
  SEC. 21.  Section 6480.1 is added to the Revenue and Taxation Code,
to read:
   6480.1.  (a) At any time that motor vehicle fuel tax or diesel
fuel tax is imposed or would be imposed, but for the dyed diesel fuel
exemption in paragraph (1) of subdivision (a) of Section 60100, or
the train operator exemption in paragraph (7) of subdivision (a) of
Section 60100 or paragraph (11) of subdivision (a) of Section 7401,
or, pursuant to subdivision (f) of Section 6480, would be deemed to
be imposed, on any removal, entry, or sale in this state of motor
vehicle fuel, aircraft jet fuel, or diesel fuel, the supplier shall
collect prepayment of retail sales tax from the person to whom the
motor vehicle fuel, aircraft jet fuel, or diesel fuel is sold.
However, if no sale occurs at the time of imposition of motor vehicle
fuel tax or diesel fuel tax, the supplier shall prepay the retail
sales tax on that motor vehicle fuel, aircraft jet fuel, or diesel
fuel. The prepayment required to be collected by the supplier
constitutes a debt owed by the supplier to this state until paid to
the board, until satisfactory proof has been submitted to prove that
the retailer of the fuel has paid the retail sales tax to the board,
or until a supplier or wholesaler who has consumed the fuel has paid
the use tax to the board. Each supplier shall report and pay the
prepayment amounts to the board, in a form as prescribed by the
board, in the period in which the fuel is sold. On each subsequent
sale of that fuel, each seller, other than the retailer, shall
collect from his or her purchaser a prepayment computed using the
rate applicable at the time of sale. Each supplier shall provide his
or her purchaser with an invoice for, or other evidence of, the
collection of the prepayment amounts which shall be separately stated
thereon.
   (b) (1) A wholesaler shall collect prepayment of the retail sales
tax from the person to whom the motor vehicle fuel, aircraft jet
fuel, or diesel fuel is sold. Each wholesaler shall provide his or
her purchaser with an invoice for or other evidence of the collection
of the prepayment amounts, which shall be separately stated thereon.

   (2) Each wholesaler shall report to the board, in a form as
prescribed by the board and for the period in which the motor vehicle
fuel, aircraft jet fuel, or diesel fuel was sold, all of the
following:
   (A) The number of gallons of fuel sold and the amount of sales tax
prepayments collected by the wholesaler.
   (B) The number of tax-paid gallons purchased and the amount of
sales tax prepayments made by the wholesaler.
   (C) In the event that the amount of sales tax prepayments
collected by the wholesaler is greater than the amount of sales tax
prepayments made by the wholesaler, then the excess constitutes a
debt owed by the wholesaler to the state until paid to the board, or
until satisfactory proof has been submitted that the retailer of the
fuel has paid the tax to the board.
   (c) A supplier or wholesaler who pays the prepayment and issues a
resale certificate to the seller, but subsequently consumes the motor
vehicle fuel, aircraft jet fuel, or diesel fuel, shall be entitled
to a credit against his or her sales and use taxes due and payable
for the period in which the prepayment was made, provided that he or
she reports and pays the use tax to the board on the consumption of
that fuel.
   (d) The amount of a prepayment paid by the retailer or a supplier
or wholesaler who has consumed the motor vehicle fuel, aircraft jet
fuel, or diesel fuel to the seller from whom he or she acquired the
fuel shall constitute a credit against his or her sales and use taxes
due and payable for the period in which the sale was made. Failure
of the supplier or wholesaler to report prepayments or the supplier's
or wholesaler's failure to comply with any other duty under this
article shall not constitute grounds for denial of the credit to the
retailer, supplier, or wholesaler, either on a temporary or permanent
basis or otherwise. To be entitled to the credit, the retailer,
supplier, or wholesaler shall retain for inspection by the board any
receipts, invoices, or other documents showing the amount of sales
tax prepaid to his or her supplier, together with the evidence of
payment.
   (e) The rate of the prepayment required to be collected during the
period from July 1, 1986, through March 31, 1987, shall be four
cents ($0.04) per gallon of motor vehicle fuel distributed or
transferred.
   (f) On April 1 of each succeeding year, the prepayment rate per
gallon for motor vehicle fuel, rounded to the nearest one-half of one
cent ($0.005), of the required prepayment shall be established by
the board based upon 80 percent of the combined state and local sales
tax rate established by Sections 6051, 6051.2, 6051.3, 6051.5, 7202,
and 7203.1, and Section 35 of Article XIII of the California
Constitution on the arithmetic average selling price (excluding sales
tax) as determined by the State Energy Resources Conservation and
Development Commission, in its latest publication of the "Quarterly
Oil Report," of all grades of gasoline sold through a self-service
gasoline station. In the event the "Quarterly Oil Report" is delayed
or discontinued, the board may base its determination on other
sources of the arithmetic average selling price of gasoline. The
board shall make its determination of the rate no later than November
1 of the year prior to the effective date of the new rate.
Immediately upon making its determination and setting of the rate,
the board shall each year, no later than January 1, notify by mail
every supplier, wholesaler, and retailer of motor vehicle fuel. In
the event the price of fuel decreases or increases or an exemption
from sales tax for sales of fuel is enacted, and the established rate
results in or could result in prepayments which consistently exceed
or are significantly lower than the retailers' sales tax liability,
the board may readjust the rate.
   (g) On April 1 of each succeeding year, the prepayment rate per
gallon for aircraft jet fuel, rounded to the nearest one-half of one
cent ($0.005), shall be established by the board based upon 80
percent of the combined state and local sales tax rate established by
Sections 6051, 6051.2, 6051.3, 6051.5, 7202, and 7203.1, and Section
35 of Article XIII of the California Constitution on the arithmetic
average selling price (excluding sales and state excise tax) as
determined by the board. The board shall make its determination of
the rate no later than November 1 of the year prior to the effective
date of the new rate. The rate of the prepayment required to be
collected for aircraft jet fuel shall be equal to 80 percent of the
arithmetic average selling price of aircraft jet fuel as specified by
industry publications. Immediately upon making its determination and
setting of the rate, the board shall each year, no later than
January 1, notify by mail every supplier, wholesaler, and retailer of
aircraft jet fuel. In the event the price of aircraft jet fuel
decreases or increases, and the established rate results in
prepayments that consistently exceed or are significantly lower than
the retailers' sales tax liability, the board may readjust the rate.
   (h) On April 1 of each succeeding year, the prepayment rate per
gallon for diesel fuel, rounded to the nearest one-half of one cent
($0.005), shall be established by the board based upon 80 percent of
the combined state and local sales tax rate established by Sections
6051, 6051.2, 6051.3, 6051.5, 7202, and 7203.1, and Section 35 of
Article XIII of the California Constitution on the arithmetic average
selling price (excluding sales and state excise tax) as determined
by the board. The board shall make its determination of the rate no
later than November 1 of the year prior to the effective date of the
new rate. The rate of the prepayment required to be collected for
diesel fuel shall be equal to 80 percent of the arithmetic average
selling price of diesel fuel as specified by industry publications.
Immediately upon making its determination and setting of the rate,
the board shall each year, no later than January 1, notify by mail
every supplier, wholesaler, and retailer of diesel fuel. In the event
the rate of sales tax imposed on sales of diesel fuel increases or
decreases or the price of diesel fuel decreases or increases, and the
established rate results in or could result in prepayments that
consistently exceed or are significantly lower than the retailers'
sales tax liability, the board may readjust the rate.
   (i) (1) Notwithstanding any other provision of this section, motor
vehicle fuel sold by a supplier or wholesaler to a qualified
purchaser who, pursuant to a contract with the State of California or
its instrumentalities, resells that fuel to the State of California
or its instrumentalities shall be exempt from the prepayment
requirements.
   (2) A qualified purchaser who acquires motor vehicle fuel for
subsequent resale to the State of California or its instrumentalities
pursuant to this subdivision shall furnish to the supplier or
wholesaler from whom the fuel is acquired an exemption certificate,
completed in accordance with any instructions or regulations as the
board may prescribe. The supplier or wholesaler shall retain the
certificate in his or her records in support of the exemption. To
qualify for the prepayment exemption, both of the following
conditions shall apply:
   (A) The qualified purchaser does not take possession of the fuel
at any time.
   (B) The fuel is delivered into storage tanks owned or leased by
the State of California or its instrumentalities via facilities of
the supplier or wholesaler, or by common or contract carriers under
contract with the supplier or wholesaler.
   (3) For purposes of this subdivision, "qualified purchaser" means
a wholesaler who does not have or maintain a storage facility or
facilities for the purpose of selling motor vehicle fuel.
  SEC. 22.  Section 7102.1 of the Revenue and Taxation Code is
repealed.
  SEC. 23.  Section 7360 of the Revenue and Taxation Code is
repealed.
  SEC. 24.  Section 7360 is added to the Revenue and Taxation Code,
to read:
   7360.  (a) (1) A tax of eighteen cents ($0.18) is hereby imposed
upon each gallon of fuel subject to the tax in Sections 7362, 7363,
and 7364.
   (2) If the federal fuel tax is reduced below the rate of nine
cents ($0.09) per gallon and federal financial allocations to this
state for highway and exclusive public mass transit guideway purposes
are reduced or eliminated correspondingly, the tax rate imposed by
paragraph (1), on and after the date of the reduction, shall be
recalculated by an amount so that the combined state rate under
paragraph (1) and the federal tax rate per gallon equal twenty-seven
cents ($0.27).
   (3) If any person or entity is exempt or partially exempt from the
federal fuel tax at the time of a reduction, the person or entity
shall continue to be so exempt under this section.
   (b) (1) On and after July 1, 2010, in addition to the tax imposed
by subdivision (a), a tax is hereby imposed upon each gallon of motor
vehicle fuel, other than aviation gasoline, subject to the tax in
Sections 7362, 7363, and 7364 in an amount equal to seventeen and
three-tenths cents ($0.173) per gallon.
   (2) For the 2011-12 fiscal year and each fiscal year thereafter,
the board shall, on or before March 1 of the fiscal year immediately
preceding the applicable fiscal year, adjust the rate in paragraph
(1) in that manner as to generate an amount of revenue that will
equal the amount of revenue loss attributable to the exemption
provided by Section 6357.7, based on estimates made by the board, and
that rate shall be effective during the state's next fiscal year.
   (3) In order to maintain revenue neutrality for each year,
beginning with the rate adjustment on or before March 1, 2012, the
adjustment under paragraph (2) shall also take into account the
extent to which the actual amount of revenues derived pursuant to
this subdivision and, as applicable, Section 7361.1, the revenue loss
attributable to the exemption provided by Section 6357.7 resulted in
a net revenue gain or loss for the fiscal year ending prior to the
rate adjustment date on or before March 1.
   (4) The intent of paragraphs (2) and (3) is to ensure that the act
adding this subdivision and Section 6357.7 does not produce a net
revenue gain in state taxes.
  SEC. 25.  Section 7361.1 of the Revenue and Taxation Code is
repealed.
  SEC. 26.  Section 7361.1 is added to the Revenue and Taxation Code,
to read:
   7361.1.  (a) For the privilege of storing, for the purpose of
sale, each supplier, wholesaler, and retailer owning 1,000 or more
gallons of tax-paid motor vehicle fuel, other than aviation gasoline,
on July 1, 2010, shall pay a storage tax of seventeen and
three-tenths cents ($0.173) per gallon of tax-paid motor vehicle
fuel, other than aviation gasoline, in storage according to the
volumetric measure thereof.
   (b) For purposes of this section:
   (1) "Owning" means having title to the motor vehicle fuel, other
than aviation gasoline.
   (2) "Retailer" means any person who sells motor vehicle fuel,
other than aviation gasoline, in this state to a person who
subsequently uses the motor vehicle fuel, other than aviation
gasoline.
   (3) "Storing" includes the ownership or possession of tax-paid
motor vehicle fuel, other than aviation gasoline, outside of the bulk
transfer or terminal system, including the holding of tax-paid motor
vehicle fuel, other than aviation gasoline, for sale at wholesale or
retail locations stored in a container of any kind, including
railroad tank cars and trucks or trailer cargo tanks. "Storing" also
includes tax-paid motor vehicle fuel, other than aviation gasoline,
purchased from and invoiced by the seller, and tax-paid motor vehicle
fuel, other than aviation gasoline removed from a terminal or
entered into by a supplier, prior to the date specified in
subdivision (a) and in transit on that date.
   (4) "Wholesaler" means any person who sells motor vehicle fuel,
other than aviation gasoline, in this state for resale to a retailer
or to a person who is not a retailer and subsequently uses the motor
vehicle fuel, other than aviation gasoline.
  SEC. 27.  Section 7653.1 of the Revenue and Taxation Code is
repealed.
  SEC. 28.  Section 7653.1 is added to the Revenue and Taxation Code,
to read:
   7653.1.  On or before August 31, 2010, each person subject to the
storage tax imposed under Section 7361.1 shall prepare and file with
the board, in a form prescribed by the board, a return showing the
total number of gallons of tax-paid motor vehicle fuel, other than
aviation gasoline, owned by the person on July 1, 2010, the amount of
the storage tax, and any other information that the board deems
necessary for the proper administration of this part. The return
shall be accompanied by a remittance payable to the Controller in the
amount of tax due.
  SEC. 29.  Section 60050 of the Revenue and Taxation Code is
repealed.
  SEC. 30.  Section 60050 is added to the Revenue and Taxation Code,
to read:
   60050.  (a) (1) A tax of eighteen cents ($0.18) is hereby imposed
upon each gallon of diesel fuel subject to the tax in Sections 60051,
60052, and 60058.
   (2) If the federal fuel tax is reduced below the rate of fifteen
cents ($0.15) per gallon and federal financial allocations to this
state for highway and exclusive public mass transit guideway purposes
are reduced or eliminated correspondingly, the tax rate imposed by
paragraph (1), including any reduction or adjustment pursuant to
subdivision (b), on and after the date of the reduction, shall be
increased by an amount so that the combined state rate under
paragraph (1) and the federal tax rate per gallon equal what it would
have been in the absence of the federal reduction.
   (3) If any person or entity is exempt or partially exempt from the
federal fuel tax at the time of a reduction, the person or entity
shall continue to be exempt under this section.
   (b) (1) On July 1, 2011, the tax rate specified in paragraph (1)
of subdivision (a) shall be reduced to thirteen cents ($0.13) and
every July 1 thereafter shall be adjusted pursuant to paragraphs (2)
and (3).
   (2) For the 2012-13 fiscal year and each fiscal year thereafter,
the board shall, on or before March 1 of the fiscal year immediately
preceding the applicable fiscal year, adjust the rate reduction in
paragraph (1) in that manner as to result in a revenue loss
attributable to paragraph (1) that will equal the amount of revenue
gain attributable to Sections 6051.8 and 6201.8, based on estimates
made by the board, and that rate shall be effective during the state'
s next fiscal year.
   (3) In order to maintain revenue neutrality for each year,
beginning with the rate adjustment on or before March 1, 2013, the
adjustment under paragraph (2) shall take into account the extent to
which the actual amount of revenues derived pursuant to Sections
6051.8 and 6201.8 and the revenue loss attributable to this
subdivision resulted in a net revenue gain or loss for the fiscal
year ending prior to the rate adjustment date on or before March 1.
   (4) The intent of paragraphs (2) and (3) is to ensure that the act
adding this subdivision and Sections 6051.8 and 6201.8 does not
produce a net revenue gain in state taxes.
  SEC. 31.  Section 167 of the Streets and Highways Code is amended
to read:
   167.  (a) Funds in the State Highway Account in the State
Transportation Fund shall be programmed, budgeted subject to Section
163, and expended to maximize the use of federal funds and shall be
based on the following sequence of priorities:
   (1) Operation, maintenance, and rehabilitation of the state
highway system.
   (2) Safety improvements where physical changes, other than adding
additional lanes, would reduce fatalities and the number and severity
of injuries.
   (3) Transportation capital improvements that expand capacity or
reduce congestion, or do both.
   (4) Environmental enhancement and mitigation programs.
   (b) With respect to the funds in the State Highway Account, in the
Public Transportation Account, and in the Passenger Rail Bond Fund,
the proposed budget shall be organized on a program basis. The
proposed budget shall list the proposed expenditures for the
transportation program under the following program elements:
   (1) Administration.
   (2) Program development.
   (3) Maintenance.
   (4) State highway operation and protection.
   (5) Local assistance.
   (6) Interregional improvements.
   (7) Regional improvements.
   (8) Environmental enhancement and mitigation programs.
   (c) State operations expenditure amounts of the department for
interregional and regional transportation improvement projects shall
be listed as required by subdivision (b) of Section 14529 of the
Government Code, but those amounts other than those for the
acquisition of rights-of-way and construction shall not be subject to
allocation by the commission.
   (d) To align the annual budget with the adopted state
transportation improvement program, the department may submit to the
Department of Finance revised capital outlay support and capital
outlay budget estimates as part of its May Revision process. Budget
proposals related to these changes shall be provided to the
Legislature no later than May 1.
   (e) The budget shall not include specific appropriations for
specific transportation improvement projects, and the Legislature
shall not enact legislation containing specific individual
transportation projects.
   (f) The basis for defining major and minor capital outlay projects
shall be established by the commission.
   (g) The Legislative Analyst shall prepare an analysis of the
proposed expenditures for each program element as a part of the
budget analysis.
   (h) The department shall submit to the Legislative Analyst, and
the Senate Committee on Budget and Fiscal Review and the Assembly
Committee on Budget, on an annual basis, supplemental information to
substantiate the department's proposed capital outlay support budget.
The information shall be provided no later than May 1 of each year,
and may be provided at an earlier date. The information shall
include, but not be limited to, the following:
   (1) A list of projects for which the department will perform
capital outlay support work in the budget year. For each project, the
department shall include:
   (A) The planned project support budget for support of
environmental, design, right-of-way, and construction phases.
   (B) The planned capital costs, including construction capital
costs and right-of-way capital costs.
   (C) The estimated or actual construction start date.
   (D) The name and year of the state transportation program in which
the project is programmed, if applicable.
   (E) Total prior fiscal year expenditures for capital outlay
support.
   (F) The number of full-time equivalent positions requested to
perform support of environmental, design, right-of-way, and
construction work in the fiscal year of the budget request.

  (G) Milestones of project work by phases that are planned to be
completed in the fiscal year of the budget request.
   (2) The capital-to-support ratio for all projects completed in the
prior fiscal year in each program in each district.
   (3) The current total number of authorized and vacant positions in
the capital outlay support program in headquarters and in each
district.
   (4) A five-year projection of the department's staffing needs to
support the state's transportation capital programs and any workload
performed by the department related to federal or local funding for
highway capital projects.
   (5) The average cost of a personnel-year equivalent in each
district based on the department's existing contracts for capital
outlay support work performed by a private company under contract
with the department. For each average cost, the department shall
provide a description of what factors are included in that cost.
   (6) The average cost of a state staff personnel-year in the
capital outlay support program in each district and in headquarters.
The cost shall include the salary and wages, benefits, program
overhead, administrative overhead, and other associated costs. The
department shall provide a description of each component of the
average cost.
  SEC. 32.  Section 183.1 of the Streets and Highways Code is amended
to read:
   183.1.  (a) Notwithstanding subdivision (a) of Section 182 or any
other provision of law, money deposited into the account that is not
subject to Article XIX of the California Constitution, including, but
not limited to, money that is derived from the sale of documents,
charges for miscellaneous services to the public, condemnation
deposits fund investments, rental of state property, or any other
miscellaneous uses of property or money, may be used for any
transportation purpose authorized by statute, upon appropriation by
the Legislature or, after transfer to another fund, upon
appropriation by the Legislature from that fund.
   (b) In the 2010-11, 2011-12, and 2012-13 fiscal years, and not
later than November 1 of each of those years, based on prior year
financial statements, the Controller shall transfer the funds
identified in subdivision (a) for the prior fiscal year to the
Transportation Debt Service Fund in the State Transportation Fund.
   (c) Commencing with the 2013-14 fiscal year, the revenues
identified in subdivision (a) shall remain in the State Highway
Account until appropriated by the Legislature.
  SEC. 33.  Section 183.2 is added to the Streets and Highways Code,
to read:
   183.2.  Notwithstanding any other provision of law, the repayment
date for the loan of one hundred thirty-five million dollars
($135,000,000) made from the State Highway Account to the General
Fund pursuant to Item 2660-011-0042 of Section 2.00 of the Budget Act
of 2009 is extended from June 30, 2012, to June 30, 2013. The
Legislature finds and declares that the revenues to make the loan
were derived from vehicle weight fees deposited in the State Highway
Account.
  SEC. 34.  Section 2103 of the Streets and Highways Code is amended
to read:
   2103.  (a) Of the net revenues deposited to the credit of the
Highway Users Tax Account that are derived from the increases in the
rates of taxes that are imposed pursuant to subdivision (b) of
Section 7360 and Section 7361.1 of the Revenue and Taxation Code, all
of the following shall occur on a monthly basis:
   (1) (A) By the 15th day of every month, the Treasurer's office, in
consultation with the Department of Finance, shall notify the
Controller of the amount of debt service that will be paid on each
transportation bond during that month.
   (B) Within two business days following the 28th day of each month,
the Controller shall transfer to the Transportation Debt Service
Fund an amount equal to the amount of monthly debt service paid by
the General Fund on any bonds issued pursuant to the Seismic Retrofit
Bond Act of 1996 (Chapter 12.48 (commencing with Section 8879) of
Division 1 of Title 2 of the Government Code) or any other highway
bonds, and three-quarters of the amount of monthly debt service paid
on any bonds issued pursuant to the Highway Safety, Traffic
Reduction, Air Quality, and Port Security Bond Act of 2006 (Chapter
12.49 (commencing with Section 8879.20) of Division 1 of Title 2) for
reimbursement of the General Fund for these costs. If revenues
available pursuant to this subdivision in any given month are
insufficient to fully reimburse the General Fund for the debt service
payments made, the first revenues available pursuant to this
subdivision in the following month or months shall be transferred to
the Transportation Debt Service Fund so that all debt service
payments made on these bonds from the General Fund in a given fiscal
year are fully reimbursed. However, no further transfers shall be
made pursuant to this subparagraph once the transfers for the months
of July to October, inclusive, in 2010 have been made. Any transfers
made from the net revenues identified in this paragraph for highway
bond debt service for months after October 2010 shall be reversed and
shall instead be made from weight fee revenues in the State Highway
Account, as described in subparagraph (D).
   (C) Beginning November 2, 2010, the Controller shall transfer to
the State Highway Account within two business days following the 28th
day of each month all of the monthly net revenues identified in
subparagraph (B) that were designated for highway bond debt service
reimbursement but that have not been transferred, or that were
transferred by means of a transfer that was reversed, pursuant to
that subparagraph. To the extent the Controller has distributed any
of those net revenues to cities and counties pursuant to subparagraph
(C) of paragraph (3) between November 2, 2010, and the effective
date of this subparagraph, the Controller shall subsequently reduce
the amount transferred to cities and counties on a monthly basis
pursuant to subparagraph (C) of paragraph (3) and shall instead
transfer these funds to the State Highway Account until all of the
revenues that would otherwise have been transferred to the State
Highway Account on and after November 2, 2010, pursuant to this
subparagraph have been so transferred.
   (D) Any remaining amount of the highway bond debt service
reimbursement authorized by this paragraph that has not been made
pursuant to subparagraph (B) on and after November 2, 2010, shall
instead be made pursuant to subdivisions (a) and (b) of Section
9400.4 of the Vehicle Code from revenues in the State Highway Account
derived from weight fees deposited in the account pursuant to
subdivision (e) of Section 9400.1 and Section 42205 of the Vehicle
Code.
   (2) (A) In the 2010-11 fiscal year, after the monthly transfer
made pursuant to paragraph (1), the sum of fifty-four million one
hundred sixty-seven thousand dollars ($54,167,000) per month shall be
held in the account for future appropriation by the Legislature.
   (B) Notwithstanding any other provision of law, with respect to
the monthly net revenues described in subparagraph (A), no further
transfers of these revenues for the purpose of loans to the General
Fund shall be made pursuant to Item 2660-011-0062 of Section 2.00 of
the Budget Act of 2010 once the loan transfers for the months of July
to October, inclusive, in 2010 have been made. Any transfers made
from the monthly net revenues in subparagraph (A) for months after
October 2010 shall be reversed and shall instead be made from weight
fee revenues in the State Highway Account, as described in
subparagraph (D). The revenues from loan repayments shall be held in
the Highway Users Tax Account for future appropriation by the
Legislature.
   (C) Beginning November 2, 2010, all of the monthly net revenues
described in subparagraph (A) shall instead be transferred by the
Controller to the State Highway Account within two business days
following the 28th day of each month. To the extent that the
Controller has distributed any of the revenues identified in this
paragraph to cities and counties pursuant to subparagraph (C) of
paragraph (3) between October 14, 2010, and the effective date of
this subparagraph, the Controller shall subsequently reduce the
amount transferred to cities and counties on a monthly basis pursuant
to subparagraph (C) of paragraph (3) and shall instead transfer
these funds to the State Highway Account until all of the revenues
that would have been transferred to the General Fund as a loan
pursuant to Item 2660-011-0062 of Section 2.00 of the Budget Act of
2010 on and after November 2, 2010, have instead been transferred to
the State Highway Account.
   (D) Any remaining amount of the loans to the General Fund
authorized pursuant to Item 2660-011-0062 of Section 2.00 of the
Budget Act of 2010 that has not been made pursuant to subparagraph
(B) on and after November 2, 2010, shall instead be made pursuant to
subdivisions (a) and (b) of Section 9400.4 of the Vehicle Code from
revenues in the State Highway Account derived from weight fees
deposited in the account pursuant to subdivision (e) of Section
9400.1 and Section 42205 of the Vehicle Code.
   (3) The Controller shall transfer any remaining net revenues
subject to this subdivision as follows:
   (A) Forty-four percent shall be transferred to the State Highway
Account to fund projects in the State Transportation Improvement
Program that are consistent with Section 1 of Article XIX of the
California Constitution, except in the 2010-11 fiscal year, 50
percent shall be transferred for purposes of this subparagraph.
   (B) Twelve percent shall be transferred to the State Highway
Account to fund projects in the State Highway Operation and
Protection Program, except in the 2010-11 fiscal year, no revenues
shall be transferred for purposes of this subparagraph.
   (C) Forty-four percent shall be apportioned by the Controller for
local street and road purposes, except in the 2010-11 fiscal year, 50
percent shall be transferred for purposes of this subparagraph as
follows:
   (i) Fifty percent shall be apportioned by the Controller to
cities, including a city and county, in the proportion that the total
population of the city bears to the total population of all the
cities in the state.
   (ii) Fifty percent shall be apportioned by the Controller to
counties, including a city and county, in accordance with the
following formulas:
   (I) Seventy-five percent shall be apportioned among the counties
in the proportion that the number of fee-paid and exempt vehicles
that are registered in the county bear to the number of fee-paid and
exempt vehicles registered in the state.
   (II) Twenty-five percent shall be apportioned among the counties
in the proportion that the number of miles of maintained county roads
in each county bear to the total number of miles of maintained
county roads in the state. For the purposes of apportioning funds
under this subparagraph, any roads within the boundaries of a city
and county that are not state highways shall be deemed to be county
roads.
   (b) After the transfers or other actions pursuant to subdivision
(a), at least 90 percent of the balance deposited to the credit of
the Highway Users Tax Account in the Transportation Tax Fund by the
28th day of each month shall be apportioned or transferred, as
applicable, by the Controller by the second working day thereafter,
except for June, in which case the apportionment or transfer shall be
made the same day. These apportionments or transfers shall be made
as provided for in Sections 2104 to 2122, inclusive. If information
is not available to make the apportionment or transfer as required,
the apportionment or transfer shall be made on the basis of the
information of the previous month. Amounts not apportioned or
transferred shall be included in the apportionment or transfer of the
subsequent month.
   (c) Notwithstanding any other law, the funds apportioned by the
Controller to cities and counties pursuant to subparagraph (C) of
paragraph (3) of subdivision (a) are not subject to Section 7104 or
7104.2 of the Revenue and Taxation Code. These funds may be expended
for any street and road purpose consistent with the requirements of
this chapter.
  SEC. 35.  Section 9400.4 is added to the Vehicle Code, to read:
   9400.4.  Weight fee revenue deposited into the State Highway
Account pursuant to subdivision (e) of Section 9400.1 and Section
42205 shall be used as follows:
   (a) For the 2010-11 fiscal year, seven hundred fifty-six million
three hundred ninety-six thousand dollars ($756,396,000) is hereby
appropriated from weight fee revenues in the State Highway Account
for transfer to the General Fund as transportation bond debt service
reimbursement and loans as follows:
   (1) The Controller shall transfer all weight fee revenues
deposited into the State Highway Account in any month to the
Transportation Debt Service Fund for transfer to the General Fund as
reimbursement for debt service costs until all of the debt service
paid on transportation bonds for projects that the Director of
Finance indicates qualify for reimbursement as provided for in
Section 16965 of the Government Code have been reimbursed.
   (2) After the Director of Finance has notified the Controller that
all debt service costs for the 2010-11 fiscal year have been
reimbursed, the Controller shall transfer any remaining monthly
weight fee revenues in the State Highway Account to the General Fund
as a loan until the full amount appropriated in this subdivision has
been transferred to the General Fund. Of the net amount loaned in the
2010-11 fiscal year, two hundred five million eighty-one thousand
dollars ($205,081,000) shall be repaid by June 30, 2014, one hundred
forty-four million four hundred forty-four thousand dollars
($144,444,000) shall be repaid by June 30, 2015, and any remaining
balance of the loan shall be repaid by June 30, 2016.
   (3) By June 15, 2011, the Director of Finance in consultation with
the Treasurer shall notify the Controller regarding the final amount
of debt service paid from the General Fund during the 2010-11 fiscal
year pursuant to Section 16965 of the Government Code and shall
direct the Controller to reverse and adjust any transfers made as
debt service reimbursements or loans so that a maximum amount of
transfers are made for debt service reimbursements and with any loan
amounts limited to the difference between this amount and the total
amount appropriated in this subdivision. The total amount of weight
fee revenues transferred from the State Highway Account for the
2010-11 fiscal year shall not be greater than the total amount of
weight fee revenues deposited into the State Highway Account for that
year.
   (4) With respect to transfers or portions of transfers that cannot
be made in any given month if weight fee revenues are insufficient,
the first weight fee revenues available in the following month or
months shall be used to complete the transfers for the previous month
or months prior to making additional transfers for later months.
   (b) For the 2011-12 fiscal year, eight hundred sixty-six million
three hundred thousand dollars ($866,300,000) is hereby appropriated
from weight fee revenues in the State Highway Account for transfer to
the General Fund as debt service reimbursement and loans as follows:

   (1) The Controller shall transfer all weight fee revenues
deposited into the State Highway Account in any month to the
Transportation Debt Service Fund for transfer to the General Fund as
reimbursement for debt service costs until all of the debt service
paid on transportation bonds for projects that the Director of
Finance indicates qualify for reimbursement as provided for in
Section 16965 of the Government Code have been reimbursed.
   (2) After the Director of Finance has notified the Controller that
all debt service costs for the 2011-12 fiscal year have been
reimbursed, the Controller shall transfer any remaining monthly
weight fee revenues in the State Highway Account to the General Fund
as a loan until the full amount appropriated in this subdivision has
been transferred to the General Fund. This loan shall be repaid by
June 30, 2015.
   (3) By June 15, 2012, the Director of Finance in consultation with
the Treasurer shall notify the Controller regarding the final amount
of debt service paid from the General Fund during the 2011-12 fiscal
year pursuant to Section 16965 of the Government Code and shall
direct the Controller to reverse and adjust any transfers made as
debt service reimbursements or loans so that a maximum amount of
transfers are made for debt service reimbursements and with any loan
amounts limited to the difference between this amount and the total
amount appropriated in this subdivision. The total amount of weight
fee revenues transferred from the State Highway Account for the
2011-12 fiscal year shall not be greater than the total amount of
weight fee revenues deposited into the State Highway Account in that
year.
   (4) With respect to transfers or portions of transfers that cannot
be made in any given month if weight fee revenues are insufficient,
the first weight fee revenues available in the following month or
months shall be used to complete the transfers for the previous month
or months prior to making additional transfers for later months.
   (c) (1) Starting with the 2012-13 fiscal year and every year
thereafter, all weight fee revenues deposited into the State Highway
Account in any month shall be transferred to the Transportation Debt
Service Fund for transfer to the General Fund by the Controller as
reimbursement for debt service costs until all of the debt service
paid on transportation bonds that the Director of Finance indicates
qualify for reimbursement as provided for in Section 16965 of the
Government Code have been reimbursed. By June 15 of each year the
Director of Finance in consultation with the Treasurer shall notify
the Controller regarding the final amount of debt service paid from
the General Fund during that fiscal year pursuant to Section 16965 of
the Government Code and shall direct the Controller to reverse or
adjust any transfers made as debt service reimbursements so that a
maximum amount of transfers are made for debt service reimbursements.
The total amount of weight fee revenues transferred from the State
Highway Account in any fiscal year shall not be greater than the
total amount of weight fee revenues deposited into the State Highway
Account in that year.
   (2) With respect to transfers or portions of transfers that cannot
be made in any given month if weight fee revenues are insufficient,
the first weight fee revenues available in the following month or
months shall be used to complete the transfers for the previous month
or months prior to making additional transfers for later months.
  SEC. 36.  Section 12811 of the Vehicle Code is amended to read:
   12811.  (a) (1) (A) When the department determines that the
applicant is lawfully entitled to a license, it shall issue to the
person a driver's license as applied for. The license shall state the
class of license for which the licensee has qualified and shall
contain the distinguishing number assigned to the applicant, the date
of expiration, the true full name, age, and mailing address of the
licensee, a brief description and engraved picture or photograph of
the licensee for the purpose of identification, and space for the
signature of the licensee.
   (B) Each license shall also contain a space for the endorsement of
a record of each suspension or revocation thereof.
   (C) The department shall use whatever process or processes, in the
issuance of engraved or colored licenses, that prohibit, as near as
possible, the ability to alter or reproduce the license, or prohibit
the ability to superimpose a picture or photograph on the license
without ready detection.
   (2) In addition to the requirements of paragraph (1), a license
issued to a person under 18 years of age shall display the words
"provisional until age 18."
   (b) (1) On and after July 1, 2011, an application for an original
or renewal driver's license or identification card shall contain a
space for the applicant to enroll in the Donate Life California Organ
and Tissue Donor Registry. The application shall include check boxes
for an applicant to mark either (A) Yes, add my name to the donor
registry or (B) I do not wish to register at this time.
   (2) The department shall inquire verbally of an applicant applying
in person for an original or renewal driver's license or
identification card at a department office as to whether the
applicant wishes to enroll in the Donate Life California Organ and
Tissue Donor Registry. Failure or refusal to answer this question or
check a box on the application form shall not be a basis for the
department to deny an applicant a driver's license or identification
card.
   (3) The following language shall be included with the question
required by paragraph (1):

   "Marking 'Yes' adds your name to the Donate Life California Organ
and Tissue Donor Registry and a pink 'donor' dot will appear on your
license. If you wish to remove your name from the registry you must
contact Donate Life California (see back); DMV can remove the pink
dot from your licenses but cannot remove you from the registry."

   (4) The back of the application shall contain the following
statement:

   "If, on the front of this form, you marked 'Yes' to register as an
organ and tissue donor you are legally authorizing the recovery of
organs and tissues in the event of your death. Registering as a donor
will not affect your medical treatment in any way. As outlined in
the California Anatomical Gift Act, your authorization is legally
binding and, unless the donor is under 18 years of age, your decision
does not require the consent of any other person. For registered
donors under 18 years of age, the legal guardian shall make the final
donation decision. You may limit your donation to specific organs or
tissues, place usage restrictions, for example transplantation or
research, obtain more information about donation, or remove your name
from the registry on the Internet Web site of Donate Life
California: www.donateLIFEcalifornia.org."

   (5) Notwithstanding any other provision of law, a person under 18
years of age may register as a donor. However, the legal guardian of
that person shall make the final decision regarding the donation.
   (6) The department shall collect donor designation information on
all applications for an original or renewal driver's license or
identification card.
   (7) The department shall print the word "DONOR" or another
appropriate designation on the face of a driver's license or
identification card to a person who has indicated on the application
his or her intent to enroll in the organ donation program pursuant to
this section.
   (8) On a weekly basis, the department shall electronically
transmit to Donate Life California, a nonprofit organization
established and designated as the California Organ and Tissue Donor
Registrar pursuant to Section 7150.90 of the Health and Safety Code,
all of the following information from every application that
indicates the applicant's decision to enroll in the organ donation
program:
   (A) His or her true full name.
   (B) His or her residence or mailing address.
   (C) His or her year of birth.
   (D) His or her California driver's license number or
identification card number.
   (9) (A) A person who applies for an original or renewal driver's
license or identification card may designate a voluntary contribution
of two dollars ($2) for the purpose of promoting and supporting
organ and tissue donation. This contribution shall be collected by
the department, and treated as a voluntary contribution to Donate
Life California and not as a fee for the issuance of a driver's
license or identification card.
   (B) The department may use the donations collected pursuant to
this paragraph to cover its actual administrative costs incurred
pursuant to paragraphs (6) to (8), inclusive. The department shall
deposit all revenue derived pursuant to this paragraph and remaining
after the department's deduction for administrative costs in the
Donate Life California Trust Subaccount, that is hereby created in
the Motor Vehicle Account in the State Transportation Fund.
Notwithstanding Section 13340 of the Government Code, all revenue in
this subaccount is continuously appropriated, without regard to
fiscal years, to the Controller for allocation to Donate Life
California and shall be expended for the purpose of increasing
participation in organ donation programs.
   (C) The department shall transmit to the Donate Life California
Organ and Tissue Donor Registry and the appropriate policy and fiscal
committees of the Legislature an annual report, and shall make
available quarterly updates, detailing funds collected through
voluntary contributions as well as a summary of applicants, including
all of the following nonidentifiable information:
   (i) Date of application.
   (ii) Method of application (field office, online, or mail).
   (iii) Donor registration status.
   (iv) ZIP code.
   (v) Gender.
   (vi) Year of birth.
   (D) (i) The annual report to be submitted to the appropriate
policy and fiscal committees of the Legislature pursuant to
subparagraph (C) shall be submitted in compliance with Section 9795
of the Government Code.
   (ii) Pursuant to Section 10231.5 of the Government Code, the
requirement for submitting the annual report to the appropriate
policy and fiscal committees of the Legislature imposed under
subparagraph (C) is inoperative four years after the date the first
annual report is due.
   (10) The enrollment form shall be posted on the Internet Web sites
for the department and the California Health and Human Services
Agency.
   (11) The enrollment shall constitute a legal document pursuant to
the Uniform Anatomical Gift Act (Chapter 3.5 (commencing with Section
7150) of Part 1 of Division 7 of the Health and Safety Code) and
shall remain binding after the donor's death despite any express
desires of next of kin opposed to the donation. Except as provided in
paragraph (5) of subdivision (b), the donation does not require the
consent of any other person.
   (12) Donate Life California shall ensure that all additions and
deletions to the California Organ and Tissue Donor Registry,
established pursuant to Section 7150.90 of the Health and Safety
Code, shall occur within 30 days of receipt.
   (13) Information obtained by Donate Life California for the
purposes of this subdivision shall be used for these purposes only
and shall not be disseminated further by Donate Life California.
                       (c) (1) All applications for a driver's
license or identification card shall contain a space for an applicant
to indicate whether he or she has served in the Armed Forces of the
United States and to give his or her consent to be contacted
regarding eligibility to receive state or federal veterans benefits.
The application shall contain the following statement:

   "By marking the veteran box on this application, I certify that I
am a veteran of the United States Armed Forces and that I want to
receive veterans benefits information from the California Department
of Veterans Affairs. By marking the veteran box on this application,
I also consent to DMV transmitting my name and mailing address to the
California Department of Veterans Affairs for this purpose only, and
I certify that I have been notified that this transmittal will
occur."

   (2) The department shall collect the information obtained pursuant
to paragraph (1).
   (3) As mutually agreed between the department and the Department
of Veterans Affairs, the department shall electronically transmit to
the Department of Veterans Affairs the following information on each
applicant who has identified that he or she has served in the Armed
Forces of the United States since the last data transfer and has
consented to be contacted about veterans benefits:
   (A) His or her true full name.
   (B) His or her mailing address.
   (4) Information obtained by the Department of Veterans Affairs for
the purposes of this subdivision shall be used for the purpose of
assisting individuals to access veterans benefits and shall not be
disseminated except as needed for this purpose.
   (d) A public entity or employee shall not be liable for loss,
detriment, or injury resulting directly or indirectly from false or
inaccurate information contained in the form provided pursuant to
subdivision (b).
   (e) A contract shall not be awarded to a nongovernmental entity
for the processing of driver's licenses, unless the contract conforms
to all applicable state contracting laws and all applicable
procedures set forth in the State Contracting Manual.
  SEC. 37.  Of the amounts appropriated in Items 2665-004-6043,
2665-304-0890, 2665-304-6043, 2665-305-0890, and 2665-305-6043 of
Section 2.00 of the Budget Act of 2010, a total of fifty-five million
three hundred twenty thousand dollars ($55,320,000) shall be
available for expenditure only after the submittal of a report to the
Joint Legislative Budget Committee and a 30-day review period, or
not sooner than whatever lesser time the Chairperson of the Joint
Legislative Budget Committee, or his or her designee, may determine.
The High-Speed Rail Authority shall have discretion concerning how
the fifty-five million three hundred twenty thousand dollars
($55,320,000) in restricted expenditures is allocated among the five
items of appropriation listed above. The authority shall submit the
report no later than February 14, 2011. The report shall include, but
not necessarily be limited to, all of the following:
   (a) A report on contract expenditures for community outreach,
including detail by type of expenditure and activity. Detail on
meetings by segment and community, and a summary of correspondence,
e-mail, media, Internet Web site, and other outreach efforts shall be
included in this report.
   (b) A copy of the strategic plan that the authority is developing
pursuant to the requirements of the State Administrative Manual.
   (c) A report on the performance of the program manager contractor.
The authority shall indicate all the measures it has taken to
address the findings and recommendations of the Bureau of State
Audits in its April 2010 report, how the authority evaluates the
performance of the contractor, and what those evaluations suggest in
terms of resolution to the deficiencies noted by the Bureau of State
Audits.
   (d) A report on how the authority has addressed other
recommendations of the Bureau of State Audits not otherwise covered
by this section.
  SEC. 38.  Of the amounts appropriated in Items 2665-004-6043,
2665-304-0890, 2665-304-6043, 2665-305-0890, and 2665-305-6043 of
Section 2.00 of the Budget Act of 2011, 25 percent of the total
amount shall be available for expenditure only after the submittal of
a report to the Joint Legislative Budget Committee and a 60-day
review period, or not sooner than whatever lesser time the
Chairperson of the Joint Legislative Budget Committee, or his or her
designee, may determine. The High-Speed Rail Authority shall have
discretion concerning how the 25 percent in restricted expenditures
is allocated among the five items of appropriation listed above. The
authority shall submit the report no later than October 14, 2011. The
report shall include, but not necessarily be limited to, all of the
following:
   (a) A complete legal analysis of the revenue guarantee or other
mechanisms to reduce the operator's risk that the authority indicates
it would provide to the operator. To mitigate risk, the authority
shall provide an analysis of the revenue contribution to the project
from the private operator with and without a revenue guarantee or
other mechanism to reduce the operator's risk. The authority shall
discuss alternative financing approaches to make up for any lost
revenue in the case of no revenue guarantee or other mechanisms to
reduce the operator's risk.
   (b) A financial plan update with alternative funding scenarios. To
mitigate risk, the authority shall report on alternative funding
options if no significant federal funds are received beyond the
federal American Recovery and Reinvestment Act of 2009 (Public Law
111-5) and no revenue guarantee or other mechanisms to reduce the
operator's risk are allowable. The plan shall also include
construction alternatives for a constrained funding environment,
including what investments would be made and construction completed
if the nonbond resources only equal bond funding.
  SEC. 39.  This act addresses the fiscal emergency declared and
reaffirmed by the Governor by proclamation on January 20, 2011,
pursuant to subdivision (f) of Section 10 of Article IV of the
California Constitution.
  SEC. 40.  This act is an urgency statute necessary for the
immediate preservation of the public peace, health, or safety within
the meaning of Article IV of the Constitution and shall go into
immediate effect. The facts constituting the necessity are:
   In order to meet the current and near-term financial requirements
of the state, it is necessary that this act take effect immediately.