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CA Sen. Steinberg Proposes New Spending Plan for Cap-and-Trade Revenue

Senator Darrell Steinberg’s new proposed spending plan for CA cap-and-trade revenue.

Senate President Pro Tempore Darrell Steinberg (D-Sacramento) announced a proposed plan to create a permanent spending strategy for cap-and-trade revenue [PDF] that prioritizes investments in affordable transit-oriented housing, transit expansion, and CA high-speed rail. Unlike the Governor’s plan for this year’s budget, Senate Bill 1156 also proposes investments in “complete streets” and transit operations.

Senator Darrell Steinberg (D-Sacramento)

Senator Darrell Steinberg (D-Sacramento)

Calling the plan a “long-term investment strategy in greenhouse gas emissions,” Steinberg said he wanted to spark a “healthy debate” about how the state should spend the revenue collected via the state’s cap-and-trade system created under A.B. 32, California’s Global Warming Solutions Act.

“This strategy is designed to achieve the objectives of A.B. 32 through significant reductions in greenhouse gas and the direction of public and private investment to California’s low-income and disadvantaged communities, which are disproportionately burdened by air pollution and the effects of climate change,” Steinberg said in a press release.

Steinberg’s staff emphasized that the plan provides a permanent funding stream for affordable, transit-oriented housing and mass transit, which are key to reaching the goals of A.B. 32 yet lack stable sources of funding. 

The proposal replaces a bill Steinberg introduced in February to replace cap-and-trade with a carbon tax. Steinberg acknowledged that the carbon tax proposal was “not that popular,” and said that the current proposal was a product of the debate provoked by the earlier bill.

A.B. 32 requires California to reduce greenhouse gas emissions to 1990 levels by the year 2020, and calls for the California Air Resources Board to create a market system for helping achieve those reductions. In response, CARB created a cap on emissions from GHG producers and an auction system to allow those who don’t meet the cap to buy emission “credits” from those who do. This cap-and-trade system currently applies to the state’s manufacturing sector, and is scheduled to include fuel producers next year.

Meanwhile, the auctions are producing revenue, which by law must be spent on further reducing GHG emissions to help California reach A.B. 32′s the goals.

Steinberg’s proposal was well-received by transit advocates. Read more…

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Updated Report Shows CAHSR’s GHG Reductions Less Costly Than Thought

UCLA’s Lewis Center revised some of the estimates in its recent report comparing the costs of reducing greenhouse gas (GHG) emissions using California high-speed rail to those of bike, pedestrian, and local transit projects. The report’s authors found that high-speed rail is not as expensive as an emission reduction as they first thought.

Lewis_yellow_box_REVISED_copyThe update makes several adjustments to the analysis, which compared CAHSR to Los Angeles Metro’s Gold Line light rail and the Orange Line bus rapid transit route, as well as the bikeway that runs parallel to it. Originally, the report found high-speed rail to be a much less cost-effective way to reduce GHGs than any of the three urban transit options. While the new cost-benefit analysis for high-speed rail looks much better, it’s still not quite on par with local transit investments.

The new comparison of costs among high-speed rail, light rail, bus rapid transit, and the bikeway is shown in the table below. As discussed in our previous story on this report, the authors consider anything less than the current price of a metric tonne of emissions under the cap-and-trade system (about $11) a cost-effective way to reduce greenhouse gas emissions. The lower the cost, the greater the cost-effectiveness.

The UCLA authors’ new cost/benefit estimates.

The new estimate for CAHSR is -$335 per metric tonne, compared to the previous $361. Those estimates are the full public cost plus user savings (in the case of high-speed rail, that’s the price of a ticket compared to the cost of driving or flying). However, the bus rapid transit, light-rail, and bikeway are still more cost-effective at -$676, $1,233, and $3,569, respectively.

Here’s why the numbers changed: Read more…

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California Legislation Watch: Weekly Update

For social media coverage of California’s statewide transportation issues, follow Melanie @currymel on Twitter or like the Streetsblog California Facebook page.

Here’s Streetsblog’s weekly highlight of legislation and events related to sustainable transportation at the California capitol.

  • News on the implementation of S.B. 743, which removes Automobile Level of Service (LOS) from consideration as an environmental impact in areas with robust transit. The state’s Office of Planning and Research released the public comments it has received on its update of CEQA guidelines and its draft guidelines for S.B. 743, passed last year. S.B. 743 requires the OPR to come up with a new urban planning metric to replace LOS that measures the effect of development and transportation projects on all traffic, not just car drivers. Proponents are enthusiastic about eliminating an outdated, car-centric measure that has led to wider, faster streets. Critics worry that cities and counties no longer have the means to require developers to improve streets. The next steps: drafting the actual guidelines, releasing them for public comment in late spring, and producing a final draft version of the guidelines by July 1.
  • Caltrans published a new mission statement: “Provide a safe, sustainable, integrated and efficient transportation system to enhance California’s economy and livability.” This is a vast improvement over the old one, “Caltrans improves mobility across California,” and it contains all the right buzzwords. The mission statement was the first item on the Early Action Plan outlined in the State Smart Transportation Initiative report urging deep reforms in Caltrans. Check — now to work.
  • More extensive senate hearings saw debates about the governor’s cap-and-trade expenditure plan and high-speed rail, this time in the Senate Transportation and Housing Committee and the Senate Budget Subcommittee on Resources, Environmental Protection, Energy and Transportation. CA High-Speed Rail Authority CEO Jeff Morales defended the use of cap-and-trade funds for high speed rail, and Senator Jim Patterson (R-Fresno) attacked cap-and-trade as a slush fund and high-speed rail as an expensive project that will produce a “puny” reduction in greenhouse gas emissions. Plenty of comments from the Legislative Analyst’s Office and various interest groups.
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Senate Committee Grills CA High-Speed Rail Authority on Its Funding Plan

The California High Speed Rail construction and phasing plan. Source: CAHSRA’s 2013 Report on the Contribution of the High-Speed Rail Program to Reducing California GHG Emissions Levels

Doubts about the High Speed Rail Authority’s ability to fund its estimated $68 billion program dominated last week’s Senate Transportation and Housing Committee hearing (see the background report in this PDF). Committee Chair Senator Mark DeSaulnier (D-Concord) said he was “somewhat skeptical” about the Authority’s 2014 Draft Business Plan and questioned CAHSRA CEO Jeff Morales on the authority’s reliance on uncertain funding sources.

“You couldn’t get a [small business loan] based on what we’re assuming here,” DeSaulnier told Morales, referring to the high cost estimates and funding prospects in the Business Plan.

DeSaulnier asked all the questions at the informational hearing, since he was the only Committee member who showed up for it. However, he came well prepared, so instead of  yet another presentation on how cap-and-trade works, there was a pointed exchange about the funding capabilities of high speed rail.

DeSaulnier warned Morales that the Authority may have a hard time getting the necessary votes in the state legislature to pass the governor’s cap-and-trade expenditure plan, which proposes giving $250 million to high-speed rail from the proceeds of the state’s greenhouse gas emissions law, A.B. 32.

“If the legislature does not approve the governor’s allocation of cap-and-trade funds, what do you foresee would be the impact on the high-speed rail program?” DeSaulnier asked Morales.

Morales responded, “The governor’s proposal allows us to move forward with certainty. If we can accelerate the program, it saves money.” Read more…

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Report: In Cutting Emissions, CAHSR Expensive Compared to Local Upgrades

Streetfilms featured Los Angeles’ Orange Line BRT and bike path in 2009. A new UCLA report says infrastructure projects like the Orange Line are a better way to invest cap-and-trade funds than CA High-Speed Rail.

UCLA’s Lewis Center published a report yesterday finding that California’s High-Speed Rail project is a relatively expensive way to reduce greenhouse gas emissions (GHG) in the near-term, compared to upgrading local transit and bicycle infrastructure.

Comparing CAHSR to Los Angeles Metro’s Gold Line light-rail and Orange Line bus rapid transit route and bikeway, the report finds high-speed rail to be the least cost-efficient investment the state could make.

The high-speed rail project costs more per metric tonne of GHG emissions than the current cost of allowances under cap-and-trade, the report says. If the savings costs to users are included in the calculations, then the light-rail, busway, and bikeway projects cost far less than the cap-and-trade auction price, which makes them more cost-effective ways to meet the emission reduction goals set out in California’s Global Warming Solutions Act, A.B. 32.

“There are a lot of projects that can reduce GHG emissions,” said Juan Matute, one of the report’s authors. “And differentiating between them will become more important in the future. One way is to look at the cost-effectiveness of the reductions.”

Governor Jerry Brown’s proposed cap-and-trade expenditure plan includes $250 million for high-speed rail to be spent in the next year alone, but very little for other transit or bicycle and pedestrian projects. High-speed rail isn’t scheduled to be online until 2022, so the savings it yields won’t help meet the state’s 2020 emission reductions goals. Meanwhile, the funds could be used for more local investments such as transit services or bicycle and pedestrian connections that would reduce GHG emissions more quickly. Read more…

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Transportation Priorities Jostle for CA’s Cap-and-Trade Revenue

A series of hearings in Sacramento have been revisiting California’s Global Warming Solutions Act, Assembly Bill (A.B.) 32, which calls for a statewide reduction in greenhouse gas emissions (GHGs) to 1990 levels by 2020. Two recent hearings have opened discussions of Governor Jerry Brown’s proposed spending plan for the revenue received so far from the state’s cap-and-trade program, implemented as part of A.B. 32, and another recent Senate hearing discussed the program’s impacts to date.

Mary Nichols, Chair of the California Air Resources Board, explains cap and trade.

The auction of cap-and-trade credits is producing money for the state, which, under A.B. 32, must be spent on helping further reduce GHG emissions. Last month, Governor Brown released his cap-and-trade expenditure plan for 2014-2015, in which he proposed to spend $850 million in expected revenue from the auctions. Of that, $600 million would be used for transportation-related projects and programs, with the lion’s share of that ($250 million) for high speed rail.

Other transportation categories include $50 million to Caltrans to expand and modernize existing rail; $200 million towards programs that encourage the use of zero-emission vehicles, including trucks, buses, and cars; and $100 million over the next two years to the Strategic Growth Council for Sustainable Communities programs, including plans that encourage compact and infill development near transit.

The governor’s plan does not include any funds for bicycling, walking, or transit other than what would fall under the above categories, even though these transportation modes offer a huge potential savings in GHG emissions.

At a Senate Transportation Committee hearing Wednesday, a long line of public advocacy groups spoke up for reshuffling the cap and trade funds, mostly in the direction of the respective group’s preferred emissions-reduction strategy (better transit, for example, or forest fire prevention given this dry year).

But only a few speakers questioned why so much money was being given to high speed rail. The Legislative Analyst’s report questioned the GHG benefits of California’s planned high speed rail, which would not have any effect on emissions until 2022 at the earliest, and would at best provide a modest contribution to GHG reductions.

“We need to fund GHG reductions in the near term,” said Catherine Phillips of the Sierra Club. “It doesn’t warrant spending 31 percent of the money on high speed rail. Many other programs will get you reductions sooner than will high speed rail.” Read more…

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California High Speed Rail: Media Piling-on Continues, as Does the Project

TGV High Speed Rail in France. Photo: TGV

TGV High Speed Rail in France. Photo: TGV

Last week, the media reported, once again, that the California High Speed Rail (HSR) project is in its death throes.

The latest batch of articles are based on a Nov. 25 decision by Superior Court Judge Michael Kenny. The judge ordered the California HSR Authority to revise a 2011 funding plan before it issues state bonds under Prop. 1A, the 2008 measure that set California’s HSR project going. The ruling also green-lighted work on the Central Valley portion of the project.

What does that really mean?

“All you have to do is front-load the federal money. Spend the $3.4 billion from the Feds,” explained Rod Diridon, Executive Director of the Mineta Transportation Institute and Chair Emeritus of the California HSR Authority board, referring to stimulus spending that’s available from Washington. “Then you spend the state part later.”

Plaintiffs include John Tos and Aaron Fukuda, Central Valley landowners in the way of the tracks. It’s one of many suits pending. The Authority tried an omnibus lawsuit, where it essentially sued itself as a defense against the many different legal actions lining up to stop the bonds. Judge Kenny didn’t go for it. “All the judge said is the Authority can’t have blanket validation of the bonds,” said Diridon.

There was a third “key setback,” as the Los Angeles Times describes them. On Dec. 5, the Surface Transportation Board of the US Department of Transportation rejected an application from the California HSR Authority to expedite review of the entire 114 mile Central Valley portion of the project. Read more…

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Unreasonable? Cap. Hill Republicans Use Flawed Report to Hit XpressWest

Last August, the Reason Foundation released a report by Wendell Cox and Adrian Moore critiquing the privately funded XpressWest’s (Xpress) application for a federal loan needed to begin construction. At the time, Streetsblog was still so busy laughing at Reason’s attempts to discredit the Expo Line based on two dudes riding the car its first week of operation, we ignored the report. Besides, the Reason Foundation issuing a report that said that High Speed Rail ridership would be lower than expected or that operations would be costlier than expected isn’t news.

Information as hot off the presses now as it was then. Click to go to the full report.

As Angie Schmitt at Streetsblog.net noted earlier in the year, before the report came out, “The Reason Foundation’s “research” on high-speed rail is pretty predictable. We know what this oil industry-backed think tank is going to say before they’ve said it: Ridership will be lower than expected; costs will be higher.”

If constructed, Xpress will be 185 miles of High Speed Rail between Southern California and Las Vegas.  The line will run within or adjacent to the I-15 freeway and have no at-grade crossings with vehicle or pedestrian traffic.  The non-stop trip between Victorville and Las Vegas could take 80 minutes. Xpress is a private, for-profit venture. Locally it is supported on the California side by conservative County Supervisor Mike Antonovich. On the Nevada side, it is a favorite project of Senator Harry Reid.

Turns out, we made a strategic error. Apparently Republican leadership in the House and Senate don’t realize that a Reason Foundation report on rail is about as credible as tobacco company report on cigarette health or a Disney funded report on a giant talking mouse’s impact on childhood development. Last week, House Budget Committee Chairman Paul Ryan and Sen. Jeff Sessions, the top Republican on the Senate Budget Committee, wrote a letter to Transportation Secretary Ray LaHood that Xpress is wasteful and too risky for taxpayers. They ask USDOT to deny a $5.5 billion loan for the project construction.

Ryan and Sessions based their letter on the Reason report from last August. However, since it’s not good enough to just laugh at them, especially since Ryan is still treated with reverence as a serious thinker by much of the political press. Streetsblog would like to note that attacking Reason’s report is not a blanket endorsement of Xpress, sometimes lampooned on Streetsblog L.A. as the “Gamblin’ Train to Vegas.” There are some concerns with the project planning, none of which were shored up when the CEO for Xpress defended the project to the press this week in the vaguest possible terms.

Now with the disclaimer over, let’s get to work. Read more…

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Cartoon Friday: All Aboard!

Advocates for High Speed Rail, especially those that read the independent California High Speed Rail Blog, have long complained that the Los Angeles Times has it in for what the paper of record constantly refers to as “the Bullet Train.” Indeed, every time I hear KFI conservative shock jocks John and Ken act shocked that a “liberal” paper such as the Times wrote a negative article about CAHSR, I chuckle. Almost all their articles about CAHSR have a negative tilt to them.

And now, the “tsk tsk” ing has spread to the editorial cartoon section. Ted Rall has a quick wit and is a competent enough cartoonist to deliver a punch line that brings a smile and a chuckle. Click on the image for a quick laugh, quite possibly at your own expense.

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“Brown Doggle?” Efforts to Use HSR as Cudgel Against CA Dems. Fizzle

The Browndoggle.”

This image was supposed to signify that California High Speed Rail was going off the tracks. Instead, it's a symbol of how efforts to use High Speed Rail as a cudgel have led to ruin. Image:John and Ken Show

Opponents of Governor Jerry Brown and the California Democratic Party have been slamming the California High Speed Rail Authority for years. The political strategy seemed to be working. Four years after voters approved a tax increase to fund a segment of what was promised to be a high speed train connecting Sacramento to San Diego, the project had morphed and grown more expensive. Voters were angry. Or so the polls said.

Earlier this year, the legislature approved a plan to build 130 miles of high speed rail in the central valley despite near-unanimous Republican opposition. One of the questions this election was whether Republicans could capitalize on the opposition to make gains at the ballot box.

Backed by funding from the oil and coal industries, and the non-stop nattering on the popular John and Ken Show, Republicans thought High Speed Rail was a winning issue.

They were wrong.

Despite a handful of Senators moving from the State Senate to Congress, Republicans actually lost ground in the Senate and now the Democrats have a super-majority in both legislative chambers. In other words, if this election was about high speed rail, voters gave Brown and his Democratic allies the ability to do what they want even if every Republican legislator votes against them.

“High Speed Rail had a goodnight, if indirectly,” wrote Robert Cruickshank at the advocacy California High Speed Rail Blog.


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