With the passage of Measure X and Senate Bill 1 (which provides additional funding to the State Transportation Improvement Program), Transportation Agency for Monterey County staff have prepared a five-year integrated funding plan to identify available sources of funding and delivery schedules for priority projects.  The purpose of the plan is to ensure that the Agency is coordinating the programming of various funding sources in the most efficient manner as well as identifying and pursuing available sources of matching funds for Measure X and State Transportation Improvement Program funds.

The projects selected for the funding plan are primarily comprised of those from the regional portion of Measure X, with the addition of the Salinas Rail Extension project.  The goals in programming funding to each of these projects was three-fold:

• First, to fund projects that are ready or near-ready for construction, such as the Imjin Road Widening project;
• Second, to advance projects as expeditiously as possible through the pre-construction process to make them eligible candidates for matching funds, such as the Scenic Highway 68 Corridor; and
• Third, to maximize the use of matching funds to deliver projects as early in the Measure X program as possible.

The following funding sources were considered as part of the draft five-year integrated funding plan:

Measure X: The regional portion of Measure X is estimated to delivery $8 million annually in new funding to Monterey County.  To advance projects as early in the program as possible and reduce the risk of rising construction costs from delaying projects to later years, staff is proposing to bond against this portion of Measure X.  Staff is coordinating with KNN Public Finance on the bonding analysis, with an initial draft proposal of two tranches of bonds.

State Transportation Improvement Program:  The passage of Senate Bill 1 provided a new infusion of funding for the State Transportation Improvement Program and a payback of funds that were removed from the County in the 2016 program due to declining gas tax revenues.  The fund estimate for Monterey County for the 2018 program is $30.9 million.  This also includes funding from a new program called Advance Project Development Element (APDE), which provides funding for the environmental and design phases of projects.  Agency's are allowed to program APDE to eligible projects, which comes as an advance in funding from the 2020 State Transportation Improvement Program.  Any unused APDE funds in the 2018 program are credited back to the 2020 program.

Inter-Regional Transportation Improvement Program: The Inter-Regional portion of the State Transportation Improvement Program is managed by Caltrans.  The Transportation Agency has been coordinating with Caltrans to program this fund source to the US 101 South County Improvements project.  While there is currently no capacity for new projects in the 2018 Inter-Regional program, Caltrans has advised the Agency to submit a $5 million request for funding coordinated with Caltrans District 5 in the 2020 program.

State Highway Operation and Protection Program (SHOPP): The State Highway Operation and Protection Program is the State’s “fix-it-first” program that funds the repair and preservation of the State Highway System,safety improvements, and some highway operational improvements.  Caltrans manages the programming of SHOPP funds, and Senate Bill 1 adds about $1.9 billion per year to the SHOPP program.  The Transportation Agency is coordinating with Caltrans to provide funding for the Highway 156 project through this program. 

Regional Surface Transportation Program / Transportation Development Act 2%:  This source of funding comes to the Agency from the State in annual amounts estimated at $4.4 million for the Regional Surface Transportation Program (RSTP) and $250,000 for the Transportation Development Act 2% (TDA 2%).  The Agency's adopted guidelines for the RSTP program sets aside 10% of the funding for the Agency's reserve, which can be used on a variety of road, bicycle, and pedestrian transportation projects.

Developer Fees:  Both the Transportation Agency and the Fort Ord Reuse Authority have development impact fee programs that contribute fee revenues towards regional priority projects. The fees are collected from new development when building permits are pulled based on the number of new vehicle trips the development will generate, serving as the development's mitigation for transportation impacts.

Federal Matching Funds:  The Federal Lands Access Program grant provides funding for projects that increase access to federal lands, including trails.  During the last grant cycle, the Transportation Agency was unsuccessful in receiving a $5.8 million grant request for the Fort Ord Regional Trail and Greenway project.  The Transportation Agency could seek to reapply to this program during the next grant cycle in 2019, using Measure X funds as match for the grant funds.

State Matching Funds:  Senate Bill 1 creates several new grant programs that priority projects in Monterey County could be eligible candidates:

• State-Local Partnership Program (SLPP): Funding from this program, $200 million per year, is for counties that have received voter approval of taxes or that have imposed fees, including development impact fees. Funds are appropriated “for allocation to each eligible county and city in the county for road maintenance and rehabilitation purposes." The California Transportation Commission is proposing to adopt a 50/50 split between competitive grants and formula-based shares. Currently, it is uncertain how much revenue the Transportation Agency would receive from its formula share due to Measure X, given that there are now 24 self-help counties and many other counties with developer fees. However, the Agency could potentially seek funding from this program for the State Route 156 and/or the Highway 68 Corridor projects.

• Solutions for Congested Corridors: Senate Bill 1 creates this new $250 million per year program beginning in fiscal year 2017/18. Funds will be allocated by the California Transportation Commission to projects designed to achieve a balanced set of transportation, environmental, and community access improvements within highly congested travel corridors. Project elements may include improvements to state highways, local streets and roads, transit facilities, bike/ped facilities, and protection of local habitat or open space. Projects may be nominated by the state or regional or county transportation agencies. To qualify for funding a project must be included in a “comprehensive corridor plan designed to reduce congestion in highly traveled corridors by providing more transportation choices for residents, commuters and visitors to the area of the corridor while preserving the character of the local community and creating opportunities for neighborhood enhancement projects.” The Transportation Agency could potentially seek funding for the State Route 68, State Route 156, or US 101 corridors from this program.

• Trade Corridor Enhancement Account: Senate Bill 1 creates this new $300 million per year account to fund corridor-based freight projects nominated by local agencies and the state. The fiscal year 2017/18 budget allocates $199.8 million to the program. The Transportation Agency could potentially seek funding for the State Route 156 project, and/or projects along the US 101 corridor.

• Transit & Intercity Rail Program: This competitive program ($1.5 billion to $2 billion over five years) is to fund a small number of transformative projects that improve the statewide network and reduce greenhouse gas emissions. The primary evaluation criteria are emissions reduction, ridership growth, achievement of integrated service, and safety benefit. Awards will be made in early spring 2018.

• State Transit Assistance: Senate Bill 1 directs approximately $105 million annually for state-of-good-repair investments. The fiscal year 2017/18 budget allocates $280 million to the program. Revenue is allocated according to the State Transit Assistance formula based on population and transit agency revenue. Upon certification of project eligibility, funds will be allocated quarterly by the Controller, starting in early 2018.

• Commuter Rail and Intercity Rail funding: Senate Bill 1 directs a 0.5% portion of new diesel sales tax revenue for allocation: half to the five commuter rail providers and half to the three intercity rail corridors. The average annual total statewide annual allocation will be approximately $4.4 million. Revenue is allocated to intercity rail corridors such that each existing corridor receives at least 25% of the intercity rail share. The Transportation Agency is working with CalSTA regarding the remaining 25% share that is expected to go to emerging corridors, such as the Salinas Rail Extension and Coast Passenger Rail. The fiscal year 2017/18 budget allocates $25 million to the program.

At the September Board of Directors meeting, Agency staff will receive guidance from the Board on the list of projects and priorities.  Agency staff will then review and receive comments on the draft five-year funding plan during the Technical Advisory and Executive Committees before bringing the proposal forward to the Board of Directors for review and comment at the October meeting.  At the December Board meeting, Agency staff will bring the finalized proposal forward as the Regional Transportation Improvement Program, which is the document the Agency is required to submit for State Transportation Improvement Program funds, and the Measure X Strategic Expenditure Plan, with is a requirement of the Transportation Safety and Investment Plan Ordinance.