Three Year Budget:
Attachment 1 is the budget for the three-year period from July 1, 2019 to June 30, 2022. Staff proposed several assumptions for the operating budget, which were reviewed by the Executive Committee in November 2018.
Operating Revenues: The Agency receives regular state planning and related operating funds from three primary state sources: Rural Planning Assistance, Project, Programming and Management funds, and Local Transportation Funds. Since November 2016, 1% revenues for Measure X administration have also been budgeted. In addition, TAMC receives funding related to specific project and program administration from several sources, which are estimated conservatively: Service Authority for Freeways and Expressways program, state rail project grants, Measure X project/program funds and railroad leases.
Staff will continue to budget staff time to grants as appropriate, such as the recently received planning grants for Rail Network Integration (coordinating Monterey County rail plans with the state rail plan) and the Regional Conservation Investment Strategy study (related to preservation of habitat impacted by transportation projects). Each of the cities and the county pay an annual Regional Transportation Planning Assessment (formerly known as the Congestion Management Program fee); the contribution amounts will stay at the same dollar level as in prior years and monies need to be paid from a local funding source. Staff time will be billed to all of these revenues, and expenditures will be tightly controlled.
The Transportation Agency continues to subsidize the activities of the Regional Impact Fee Agency. The budget is projecting the annual use of $10,000 in fee revenue to pay for operating expenses, although the ongoing annual cost to the Transportation Agency for this activity is much higher. Expenditures on regional fee activities are being tracked with the expectation that this cost will be repaid to the Transportation Agency as more fees are collected in the future.
Potential revenue risks to the agency continue to include a reduction in federal and state planning funds and minimal new development and therefore reduced administration funds for the Regional Development Impact Fee Agency. No state funding other than Planning, Programming and Monitoring has been cut recently, but staff will keep the Board advised. Should major revenue reductions occur, the agency would have to reevaluate its revenues, costs and mission to determine essential vs. discretionary activities. Billing staff time to specific projects, when possible, will continue to be a priority.
Operating Expenses: A 3% cost of living allowance is proposed for fiscal year 19/20. Merit increases, and promotions will continue to be available subject to performance.
In order to seek ways to restrain rising health care costs, while still providing and protecting quality care, the Agency revised its cafeteria health benefit allowance for its active employees in FY 2011/12. The changes eliminated several variables that existed, permitted the Agency to better forecast its obligation under the cafeteria plan, and reduced the liability for future premium increases. Employees have the flexibility to choose from several plans that are offered by CalPERS. In order to offset recent premium cost increases, a change to TAMC’s cafeteria plan health allowance is proposed, which would result in an increase of $129.51/month for general employees and $259.02/month for management as of FY 2019/20. The last change to this allowance was made three years ago. No change is proposed to the cash-out allowance.
The Agency contribution to CalPERS in FY 2019/20 is projected to be higher than last year due to CalPERS lowering the discount rate (assumed rate of return on investments) from 7.25% to 7.0%. The Agency paid off its side-fund liability in December of 2013 and made a sizeable payment towards its unfunded liability in June 2016. These two factors help in keeping contributions lower than they would have otherwise been. However, due to Caltrans requiring the Agency to book the expense of the unfunded liability over a 5-year period ($110,168/year) in order to be reimbursed, the budget continues to reflect $110,168 towards the pension contributions.
The Public Employees’ Pension Reform Act of 2013 continues to help curtail the agency’s costs in the future due to the establishment of a 2nd tier, 3-year averaging and required sharing of employee contributions with future new members. In addition, all Agency employees pay a total contribution of 3.5% towards their CalPERS. These contributions help cover increases in CalPERS retirement costs and have brought the member share by employees at the payment percentage recommended in the new pension reform law.
Direct Program: Projects, programs and consultant work are funded out of the Direct Program budget. For example, the traffic counts program is funded from the Regional Surface Transportation Program in the Direct Program budget. Caltrans audit repayment, Public Outreach (annual report), installation of bikeway wayfinding signs and State legislative advisor costs are funded from the unassigned reserve. No funds are currently budgeted for consultant Federal legislative advisor services. Regional Development Impact Fee revenues have been designated by Board action to pay for project costs related to SR 156 improvements and the Highway 68 Monterey to Salinas Scenic Highway corridor.
As a result of good fiscal management, the agency has added to its reserve in past years. As designated in its GASB 54 fund balance policy, the agency will continue to maintain a minimum of a six-month operating budget balance in its undesignated reserve. Also, as requested by the Executive Committee, any excess over the six-month level is designated as a “contingency” fund to cover short-term revenue shortfalls or unanticipated expenses. A portion of the undesignated contingency fund is forecast to be used in each of the three budget years for Operating and Direct Program activities.
Annual Work Program
The annual Agency Overall Work Program describes the activities to be accomplished during the fiscal year beginning July 1, 2019 and ending June 30, 2020. After the draft Overall Work Plan is approved by the Transportation Agency Board of Directors at the February 27 meeting, the draft plan will be submitted to Caltrans, who reviews the document and provides comments on the state funded activities in the plan. Agency staff then incorporates comments from Caltrans, as well as comments received from the Transportation Agency Board, into to a final proposed Overall Work Program to be presented to the Board of Directors in May for adoption in conjunction with the fiscal year 2019/20 budget.
Highlights of the Draft 2019/20 Overall Work Program include the following activities, listed under each of the Agency's four adopted goals: Deliver Projects, Maximize Funding, Communicate Early and Often, and Prepare for the Future.
Deliver Projects (and Programs)
Measure X administration and implementation including,
- Imjin Road improvements: work with City of Marina to initiate and complete construction.
- State highway projects – work with Caltrans on: Highway 156 at Castroville Blvd Interchange; Highway 68 Corridor; US 101 South of Salinas corridor study;
- Highway 1 busway on the Monterey Branch Rail Line: work with MST and Caltrans on environmental review; work with Caltrans, the Cities of Seaside and Sand City to design improvements to intersection at Fremont/California Avenues at Highway 1.
- SR 156-Blackie Road Extension: Coordinate with County of Monterey to initiate environmental review and preliminary engineering.
- Fort Ord Regional Trail and Greenway: finalize environmental review and preliminary engineering.
- Habitat Preservation/Advance Mitigation: initiate the Resource Conservation Investment Strategy with Caltrans and natural resources agencies.
- Safe Routes to School: continue to advance the education, enforcement and engineering improvements to reduce collisions.
- Senior and Disabled Mobility program: oversee programs funded and begin planning for new round of funding.
Non-Measure X Projects:
- Salinas Rail Extension Project: construct Lincoln Avenue extension and parking improvements and continue the right-of-way acquisition and final design for the remainder of the project.
- Bikeway Signs: continue installing signs for routes identified in the Regional Bicycle Wayfinding Plan.
Administration of Ongoing Programs
- Go831 traveler information program: continue to outreach to major employers to encourage carpooling, vanpooling, telecommuting, using the bus, biking and walking to work.
- Call Boxes and Tow Trucks: Continue upgrade of Call Box motorist aid network; oversee operation of Freeway Service Patrol tow truck program.
- Bicycle Secure Program: fund racks, lockers and related secure storage for bicycles, skateboards and scooters.
Maximize Funding
- Matching grants: work to secure SB 1 and other matching grants for priority projects
- Planning grants: evaluate the need for future corridor studies and safe routes to school grants.
- Corridor Study implementation: Work with the local agencies and Caltrans to fund improvements identified in the Highway 218 corridor and Pajaro to Prunedale corridor studies.
- Other agencies: assist Caltrans, Monterey-Salinas Transit and member agencies in securing funding to deliver priority transportation improvements.
Communicate Early and Often
- Continue high level of public interactions during project development and construction.
- Educate staff, Board members and the public on new technology and innovative engineering designs.
- Prepare Agency and Measure X annual report, and work with the Chair on the end of year report.
- Assist member agencies with public outreach.
- Continue ongoing agency media outreach.
Prepare for the Future
- Complete streets: support local use of bicycle and pedestrian safety improvements as part of a “complete streets” policy.
- Intersection safety and roundabouts: continue to investigate and support the installation of new engineering designs for intersections to improve safety.
- SAFE Callbox Program: coordinate with CHP to initial removal of underutilized call boxes.
- Electric Vehicle network: work with Monterey Community Power and the California Energy Commission to assist with installation of EV charging facilities.
After the draft Overall Work Plan and budget are approved by the Board of Directors, they will be submitted to Caltrans for review and comment. Agency staff then will incorporate comments from Caltrans and the Transportation Agency Board into to a final proposed Overall Work Program to be presented in May to the Executive Committee for review and to the TAMC Board of Directors for adoption.