them to the interim operations control -- mca is proposing to return to the interim operations control center. similarly, we have the obligation of $69 million on the fund replacement project. it straddles both the facilities and guidance categories. another obligation is the significant financing costs for both categories. just for reference, it takes the facilities category from 32% financing cost down to 25%, making $6 million more available for projects. we will get about $8 million made available for projects. with that, and will be happy to answer questions. >> thank you, ms. lombardo.

commissioner avalos? commissioner avalos: thank you, maria. you have this line item for the geneva project. can you comment on that? this is a source where funding is being reallocated? is that correct? >> the geneva kennedy project -- canopy project was projectprop k funded at all. what mta is proposing is to redirect that funding to the subway. commissioner avalos: thank you. commissioner campos: thank you. colleagues, any of the questions? no questions. let's open it up to public comment. is there any member of the public that would like to speak on this item?

seeing none -- oh, actually we do. >> can you hear me? commissioner campos: yes. >> good morning. i am serving on the cag advisory did -- advisory group since 1978. i am getting older. also, -- i do not claim to be an expert on transportation. i have to say that for the new

project, -- muni project, all the cag members have full confidence we can get the funding. they will come along with the mpaa championship. we have come a long, long way. it is great. even in chinatown. it is the right thing to do. i am not so happy it has taken a long time, but i realize it is a

long, long distance. [bell rings] it takes time. thank you. commissioner campos: thank you, sir. is there any other member of the public who would like to speak? seeing 9, public comment is -- seeing at non-, public comment is closed. commissioner chiu? >> we have been figuring out the specifics on how we are going to close the gap in funding i think we have been rewarded with more clarity. at this time i would like to recommend the amendment for the central subway project that we have all supported, unanimous for the past, what the authorities proposed as far as the funding commitments. i say we should move this

forward. i look forward to working with the mta staff to make sure we are all on the same page and as clear as possible. commissioner campos: thank you. colleagues, can we take that without objection? without objection, thank you, to the mta staff and the t.a. staff. madam clerk, call item 8 please. >> [unintelligible] commissioner campos: we have the executive director. >> this is really an item on the agenda to introduce new items, but i have something i would like to share with you. this is news that is about three hours old. this morning, the vice president may be a major

announcement in philadelphia for a $63 billion initiative to essentially make good on the president's promises for high- speed rail in this country. as you can imagine, the details of funding are not quite available yet. it is a huge program. i believe, but i am not clear. the initial installment was the stimulus money and the other $8 billion we were promised. in any case, it is a major step forward for the president and his administration to clarify the structural policies referring to a high-speed rail. we have confidence that california will do well. because it is really the only

state in the union that has committed a significant amount of money to kickstart the initial segment. as i thought it would be important to share the news as soon as it happened. i want to point out this also bodes well for amtrak. i have the honor of the sharing deking engagement with the share one month ago -- sharing a speaking engagement with the chair one month ago. he was speaking about the location of the federal trust fund for one year. i want to point out -- i think i have said to -- said this to you before -- spain spent $5 billion

a year on high-speed rail for the past 27 years. that is a commitment which has made it today the most important network in europe, the most interconnected, the most genuinely high speed. this country has the potential to do that and more. i am very happy to convey that news to you. also, just a domestic flight in this country, the number of passengers it carries is 800 million. high-speed rail carries 28 million people per year. we are a long way away from chipping away at flights. i think you have to start somewhere. we have not seen an announcement of this magnitude in awhile. commissioner campos: thank you.

is there any member of the public to would like to speak to this item? seeing none -- oh, yes? please come forwardpublic comme. 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