BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                     AB 620


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          Date of Hearing:   January 11, 2016


                        ASSEMBLY COMMITTEE ON TRANSPORTATION


                                 Jim Frazier, Chair


          AB 620  
          Roger Hernández - As Amended January 5, 2016


          SUBJECT:  High-occupancy toll lanes: exemptions from tolls


          SUMMARY:  Expands the low-income assistance program associated  
          with the Los Angeles County Metropolitan Transportation  
          Authority's (Metro's) value-pricing and transit development  
          program (ExpressLanes Program).  Specifically, this bill:  


          1)Expands the requirement that Metro work with low-income  
            commuters in communities affected by the ExpressLanes Program  
            in the Interstate 10 (I-10) and Interstate 110 (I-110)  
            corridors to require that mitigation measures (such as reduced  
            toll charges and toll credits for transit users) be extended  
            also to low-income transit users.


          2)Provides that these mitigation measures apply to low-income  
            commuters and transit users that do not otherwise meet the  
            criteria for a hardship exemption, as described below.  


          3)Requires Metro, until January 1, 2022,  to exempt commuters  
            from ExpressLanes toll charges if they meet the eligibility  
            requirements for any one of the following public assistance  
            programs:








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             a)   California Work Opportunity and Responsibility to Kids  
               Act (CalWORKS Program);


             b)   State Supplementary Program for Aged, Blind and  
               Disabled;


             c)   County Aid Relief to Indigents;


             d)   CalFresh (a.k.a. Food Stamp Program);


             e)   Food Assistance Program for Legal Immigrants; or


             f)   Cash Assistance Program for Aged, Blind, and Disabled  
               Legal Immigrants.


          4)Authorizes Metro to discontinue issuing hardship exemptions if  
            it determines at a public hearing that issuing additional  
            exemptions will "significantly jeopardize" the amount of toll  
            revenues necessary to operate and maintain the ExpressLanes  
            Program. 


          5)Requires Metro to report to the Legislature by January 31,  
            2019, the number of hardship exemptions that were provided  
            during the period between January 1, 2017, and December 31,  
            2018, and specifically how many were provided to commuters  
            residing in the San Gabriel Valley.  


          EXISTING LAW:  









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          1)Authorizes Metro to conduct, administer, and operate the  
            ExpressLanes Program on I-10 and I-110 in Los Angeles County. 


          2)Requires Metro, when implementing the program, to work with  
            affected communities in the two highway corridors and provide  
            mitigation measures for low-income commuters, including  
            reduced toll charges and toll credits for transit users. 


          3)Requires that participants in the low-income assistance  
            program meet eligibility requirements for any one of several  
            specific public assistance programs.


          FISCAL EFFECT:  Unknown


          COMMENTS:   SB 1422 (Ridley-Thomas), Chapter 547, Statutes of  
          2008, authorized Metro, until January 15, 2013, to develop and  
          operate a value-pricing and transit development demonstration  
          program involving high-occupancy toll lanes, referred to as  
          ExpressLanes.  The program was primarily funded with a $210  
          million congestion reduction demonstration grant from the U.S.  
          Department of Transportation.  Tolling began in November 2012 on  
          the I-110 and in February 2013 on the I-10.  AB 1224 (Eng),  
          Chapter 441, Statutes of 2010, extended the sunset and reporting  
          dates for the ExpressLanes Program from January 2013 to January  
          2015, and SB 1298 (Hernández), Chapter 531, Statutes of 2013,  
          recast the program and extended it indefinitely.





          The author introduced AB 620 because he is concerned about the  
          impact that the ExpressLanes program is having on constituents  
          in his district, particularly low-income constituents.  He has  








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          voiced concerns that the ExpressLanes Program was supposed to  
          improve commutes for all users in the corridor, not just the  
          toll-paying ones.  He asserts that these improvements have not,  
          however, materialized and that lanes adjacent to the tolled  
          lanes experience longer periods of congestion now than they did  
          prior to the start of the ExpressLanes Program.  Consequently,  
          commuters that can afford to pay the tolls enjoy shorter  
          commutes at the expense of non-paying commuters (including his  
          low-income constituents) for whom travel times have worsened.   





          The author also believes Metro's low-income assistance program  
          is underperforming, as demonstrated by low enrollment rates in  
          the program and the fact that there are only two facilities in  
          all of Los Angeles County where applicants can take proof of  
          eligibility to participate in the low-income assistance program  
          (in addition to being able to mail the information in).





          Generally, concerns for the economic impact that toll facilities  
          could have on low-income commuters are well founded, considering  
          that economic studies show that the biggest burden on family  
          incomes is the cost of housing and transportation.  For example,  
          a report by Smart Growth America found that transportation is  
          the second largest expense for American households, costing more  
          than food, clothing, and health care.  Furthermore, it has been  
          documented that the working poor spend a fraction of what other  
          workers spend on commuting expenses, but those costs amounted to  
          a significantly higher proportion of their income.  












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          To participate in Metro's low-income assistance program, an  
          individual must be a Los Angeles County resident with an annual  
          household income at or below two times the federal poverty level  
          (e.g., $40,180 for a 3-person household).  Applications for the  
          program can be submitted by mail or at one of two walk-in  
          centers.  Qualifying residents receive a $25 credit when they  
          set up an account, which can be applied to either the  
          transponder deposit or pre-paid toll deposit.  The monthly  
          account maintenance fee is waived.  To date, 8,877 households  
          are enrolled in the low-income assistance program out of over  
          450,000 Express Lane accounts.  



          AB 620 requires Metro to modify its low-income assistance  
          program by: 1) expanding it to require mitigation measures for  
          low-income transit users as well as low-income commuters; and 2)  
          requiring Metro to offer, for five years, toll-free passage to  
          commuters that are eligible for specific public assistance  
          programs.  AB 620 tries to mitigate the financial impact that  
          hardship exemptions could create by granting Metro the authority  
          to opt-out of the hardship exemption requirement upon a finding  
          that granting the hardships would jeopardize the ExpressLanes  
          operation.  Hardship exemptions up to that point would still be  
          valid until 2022. 



          According to Metro, its low-income assistance program is the  
          first in the nation to address equity concerns on toll lane  
          projects and has been, by many accounts generally successful.   
          Metro claims that it has relied heavily on independent  
          consultants and extensive outreach with affected communities to  
          design and improve the program to ensure it reflects community  
          concerns and meets the needs of low-income commuters.  Metro  
          reports that, to date, the ExpressLanes Program has invested  
          over $150 million in transit-related improvements along the  








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          I-110 and I-10 corridors, including a new transit center in El  
          Monte, 59 new buses for transit providers and safety  
          improvements to the Harbor Transitway.  



          Metro is opposing AB 620.  Metro's chairman of the Board of  
          Directors, Mr. Mark Ridley-Thomas writes in opposition, "As the  
          original author [of the legislation authorizing the ExpressLanes  
          Program], I appreciate and share Assemblymember Hernández'  
          interest in ensuring that the Program benefits low-income  
          commuters.  At the time that my bill was being developed, I  
          insisted that Metro address this issue in a comprehensive and  
          thoughtful manner, requiring an Equity Plan, and that the agency  
          work directly with affected communities to address their  
          concerns.  In response, Metro implemented a robust outreach  
          effort that has included over 700 meetings and briefings."  Mr.  
          Ridley-Thomas also argues that the overwhelming and consistent  
          priority voiced by low-income commuters in the ExpressLane  
          corridors has been for toll revenues to be invested in transit  
          services and that exemptions from the tolls were not a priority  
          for these commuters.  


          Committee concerns:   The committee has some concerns with the  
          bill:

          1)The bill will increase congestion in the tolled lanes.   
            Consequently, Metro may have to increase toll rates to manage  
            the increased congestion.   

          2)AB 620 bill does not define "low-income" other than for  
            purposes of providing hardship exemptions.  It is not clear,  
            then, who would be eligible for the other mitigation measures  
            required by the bill.












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          3)Clear statements of desired, measurable performance outcomes  
            should be included in the bill.



          4)Last year, the Legislature passed and the Governor signed AB  
            194 (Frazier), Chapter 687, Statues of 2015, which grants  
            broad authority to the Caltrans and to regional transportation  
            authorities to develop and operate toll facilities, upon  
            approval of the California Transportation Commission.  A major  
            tenet of AB 194 is local control for locally-sponsored toll  
            facilities, in acknowledgement that community-specific needs  
            should influence how toll facilities are developed and  
            operated and how any excess revenues are spent.  Generally,  
            the emphasis on local control of locally sponsored facilities  
            should be maintained, consistent with the spirit of AB 194.   
            [Regarding AB 620, however, the author argues that, because  
            the ExpressLanes Program (including requirements for the  
            low-income assistance program) were specifically authorized in  
            statute, it is appropriate that the Legislature remain  
            involved in refining this specific program.]



          Previous legislation:  SB 1298 (Hernández), Chapter 531,  
          Statutes of 2013, recast the program and extended it  
          indefinitely.

          AB 1224 (Eng), Chapter 441, Statutes of 2010, extended the  
          sunset and reporting dates for the ExpressLanes Program from  
          January 2013 to January 2015.



          SB 1422 (Ridley-Thomas), Chapter 547, Statutes of 2008,  
          authorized, until January 15, 2013, Metro to operate the  
          ExpressLanes Program. 









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          REGISTERED SUPPORT / OPPOSITION:




          Support


          None on file




          Opposition


          Los Angeles County Metropolitan Transportation Authority




          Analysis Prepared by:Janet Dawson / TRANS. / (916) 319-2093