public comment is close. madam clerk, can you call item 9? >> is there any member ofthe public -- of the public wishing to speak on this? public comment is closed. item 10, adjournment. thank you. have a good day.

>> good morning. welcome to the regular meeting of the transportation finance commmittee. i am eric mar, joined by sean elsbernd, malia cohen, and mark farrell. erika cheng is the clerk. i would like to thank charles anfor providing televised access to the meeting. >> for the 2011 meeting -- this

is an action item. >> on the minutes, is there a motion? without objection? is there anyone from the public wishing to speak? public comment is closed. >> this is an action item. >> can you call item four? >> this is an information item. >> hearing items three and four. >> good morning. i am the executive director. this is the time of the year, we bring you the state and federal legislative program. this is the set of principles we

like to use to follow the legislative advocacy. this has a focus in sacramento and washington, reflecting on how we interract with the regional agencies of which several of you are members, also. i will only make a couple of comments about the state legislative program, then the staff with a more detailed presentation. we are here to talk about the update of state legislation specific to bills. and an update on the state of the state budget. initiatives are being considered, currently. at the state level, you all know the challenges.

a time of constrained funding. we have some big news i want to announce in a second. so the picture changes a bit, based on that. i want to reflect on the challenge the state has, contrasted with the federal challenge. at the state level, a new governor, where revenue is down and there is upwards of 25 billion dollars in deficits. the prospect of cuts and reducing taxes. one key issue i have discussed with people in sacramento, is the fact the state needs to grow to come out of the current situation.

we need a clear investment in infrastructure, with the power grid and water supply. as the 7th economy, we need a coherent policy with some continuity to signal to the rest o the w -- of the world, to the investors who want to put money into california, that they are serious about an infrastructure program. that word is still to come. that is part of the difficulty of hthe legislative agenda. we want to advocate for some

form of predictability in the way we issue bonds. the 1-a and 1-b bonds. the infrastructure has been capacity. they haven't wanted to issue this because of the difficulty of rating them. paying more interest for borrowing when the credit rating is not good. a number of projects at the local level were moved forward with great advocacy. on the expectation a good chunk of the funding plan would be on the bonds. for us, we are no longer advancing sales tax money. we have done this expecting the

state to catch up. if the state doesn't come through, we will begin to reevaluate at least the schedule of some of these projects. these are some of the challenges with the state advocacy agenda. at the federal level, we have reauthorization of the surface transportation act. we generate 50 or $60 billion a year. this act is typically funded with federal gas tax money. this has been declining for many years. the highway trust fund went into deficit. with no clear signals for a

consensus in congress about increasing the gas tax. 18 cents per gallon. it is a political issue. a philosophical difference. it is set back -- about four hours ago, the vice president announced a new high-speed rail program for the nation. there will be 50 billion in high speed rail. if this is new or reshuffled revenue. this will be new or it will be taken from the defense budget so we can support this. the state of california is well- positioned to qualify for high- speed rail money.

we are the only state that has this kind of approval through a referendum, the rail bond. it is at least a bond to commit to the project. $53 billion gets noticed. it was very encouraging to see $8 billion a year or so ago. but $53 billion signals the kind of continuity we have all been talking about in the transportation community. it would be hard to engage the private capital in the system. the federal government signals a rapid, long-term commitment to this infrastructure.

we don't know how this news will do in congress. it is the biggest announcement in a long time for infrastructure and delivers on the state of the union. >> can you talk about the implication of the transbay center and doyle drive parkway? >> i don't think this would have any relation to highway projects. the second phase, the tunnel between fourth and king does not have funding and until we heard this, did not seem to have a viable way to complete the

funding. this could provide the opportunity. >> mr. elsbernd has a question. >> i don't know how the administration intends to make this happen. the main issue is the funding source. you know this better than anybody. it takes more than advocacy. without a champion in the administration, it would never happen. like the california lottery. the chances of winning are the same, but to win, you have to play. i will be the last person to

criticize the administration. this is what we need. a visionerary push from the president and vice president. it may be considered seriously. it it arrives as proposed, it is part of the game. but what a contrast. that is a big step at the federal level. we know parts of the a dvocacy program will be to make sure we show a set of projects ready to go in the bay area, to try to put the best face we can on the conflicts and issues about that, but make a clear link between high-speed rail and

the caltrains service, for capital improvement. and finally, that we show a common front on california, those looking for high-speeld rail money. the state needs to claim a good portion of the moeny to -- money to generate this. the vice president made distinctions and i will circulate this to you. it was in terms of the types of corridors to be upgraded. he talked about true high-speed corridors, the trains could circulate at speeds of 230 mph. and others that would be regional, operating at slower

speeds. speeds reaching to 120 mph. this is what we have with high- speed rail, in new york to boston. it does not go faster than that. plenty of challenges. but this is a turning point in terms of that discussion. i look forward to encorporating that into the advocacy. the other thing is that, just as we conveyed this at thte state level, the advocacy is in for new revenue. gas tax increases or a form of user fee considered fair. even a congestion charge. imposed in a way that generates

opportunity to capture some new revenue. and a clear set of policies about investment in infrastructure. and the urband centers, called to carry the biggest load for the climate change challenge. more efficient trips and so on. we have our hands full with just a couple of items i mentioned. and about san francisco, let me ask the staff to complete tine the -- complete the presentation. do you have any other questions? >> anna laford of policy and programming.

thank you, jose, for a great picture of the legislative agenda at the federal level and the state level. i will go into more specifics. we have a matrix of the general policies that will guide us at the state level. mark watts, as the expert in the state budget, he will give you an overview of what is happening with a proposal on the redevelopment agencyc. . our most important issue, to name a few, are reaffirming the gas tax. this was approved in march 2010. this is a swap where the sales

tax was decreased with a compensating increase in the exhise tax, and this was to allow the state to use these revenues to repay general obligations for bond debt service on transportation bonds, and the sales tax could not be used. it retained the sales tax for public transportation. the intent was to hold tra nsportation harmless. what this does is puts stronger protection -- on transportation with prop 26, prohibiting the increasing of the tax without two-thirds approval of the legislature.

the swap needs to be codified by the legislature. it has general fund issues as well and this is a hot issue. one that will be addressed in the near term with solving the deficit for the budget year. to go through, again, advocating for new revenue at the state and federal level. at the state level, a close look at how revenue is distributed at the regional and the state. in particular, some of the revenue is distributed on population and number of registered vehicles. we would like an expansion for daytime population. and road and transit usage.

we would like to see support for high-speed rail funindding, new transportation revenue, and the prop. 1-a bond fund and infrastructure bond funds in 2008 and 2006. we would like to see them in a stable way, flowing to the project. central subway has 360 million for the funding plan. that is definitely at the high point of the legislative agenda. did you have a question? of course, advocating for funding for the approvement

program so funding can be used for these projects. and local funds will be reimbursed. that is my presentation. i am glad to answer any questions for you about this agenda. i will turn the mike over. >> i just wanted to thank you and lombardo for the great work and the regional approach. there is a coalituion, the county coalition this came out of. what is this alliance? >> these are the counties with sales tax in the county. there is a coalition forming over the years to gather a couple of times a year, coming to a meeting of the minds on a legislative agenda.

>> this 2011 legislative agenda, can you talk about how this is different? it seems very similar and flexibility is a key part. >> there is not that much different. increasing revenue and protecting revenue. that has not changed. if this is reaffirmed, there is a level of certainty as far as protection revenue, which wasn't in play at this time last year. however, transportation revenue is always at risk of diversion. and high-speed rail, time is of the essence to get the bonds sold and