State-owned Toll Bridge Seismic Retrofit Financing Act Of 2001 - - CA Streets And Highways

Section § 31070

This law discusses the response to major earthquakes in California, particularly regarding the reinforcement of state bridges and highways to ensure seismic safety. After the Loma Prieta and Northridge earthquakes, seismic retrofitting of bridges became a top priority. In 1996, Proposition 192 allowed for a $2 billion bond to retrofit state highway structures, including seven toll bridges. However, costs increased to $2.6 billion, leading to a funding agreement splitting costs between the state and local toll payers. The law also talks about exploring various financing options, including federal loans and issuing bonds, to cover these expenses.

The Legislature hereby finds and declares all of the following:

(a) Following the 1989 Loma Prieta earthquake, legislation was enacted to make seismic safety a top transportation priority in this state. In the wake of the Northridge earthquake of 1994, when nine major freeway bridges were destroyed and 11 major highways wee closed, seismic retrofit of the state’s bridges and highways again became the number one priority on the state’s transportation agenda.

(b) In 1996, voters approved Proposition 192, a two billion dollar ($2,000,000,000) bond measure for state highway seismic retrofit. This funding measure includes the costs of retrofitting seven state-owned toll bridges, five in the San Francisco-Oakland Bay area and two in southern California. Replacement costs for the eastern span of the San Francisco-Oakland Bay Bridge were factored in as well.

(c) Subsequent to the adoption of Proposition 192, new cost estimates by the department increase the toll bridge retrofit program from six hundred fifty million dollars ($650,000,000) to two billion six hundred million dollars ($2,600,000,000). To address this increase, the Legislature enacted legislation in 1997, establishing the compromise of a 50/50 funding agreement between the state and local toll payers to finance all state-owned bridges in the San Francisco-Oakland Bay area, Los Angeles, and San Diego.

(d) It is the further intent of the Legislature that the department address the funding deficiency through a combination of financing options. These options may or may not include obtaining a loan under the federal Transportation Infrastructure Finance and Innovation Act of 1998 (P.L. 105-178), a program authorized by the Congress of the United States in 1998 to provided credit assistance for large transportation projects.

(e) Other financing options include revenue bonds and commercial paper should be issued under the authority of the California Infrastructure and Economic Development Financing Bank, the California Transportation Commission, or other, appropriate entity.

seismic safety bridge retrofitting Northridge earthquake Loma Prieta earthquake Proposition 192 toll bridges San Francisco-Oakland Bay Bridge state highway funding infrastructure bonds federal loans Transportation Infrastructure Finance and Innovation Act revenue bonds California Infrastructure and Economic Development Financing Bank California Transportation Commission transportation financing

(Added by Stats. 2001, Ch. 907, Sec. 5. Effective January 1, 2002.)

Section § 31070.5

This section of the law defines certain terms that are used in relation to Bay Area transportation and infrastructure. 'Authority' refers to the Bay Area Toll Authority, while 'Account' is the Toll Bridge Seismic Retrofit Account for funding bridge retrofits. 'Bank' indicates the California Infrastructure and Economic Development Bank, and 'Bay area bridges' refers to the state-owned toll bridges governed by the Metropolitan Transportation Commission. 'Bonds' have a specific meaning tied to another government code. 'Department' is shorthand for the Department of Transportation. 'TIFIA' refers to a federal act that provides financial support for transportation infrastructure, and 'Toll surcharge' is an extra fee for seismic retrofit funding.

For the purposes of this chapter, the following terms have the following meanings, unless the context requires otherwise:

(a) “Authority” means the Bay Area Toll Authority established under Section 30950.

(b) “Account” means the Toll Bridge Seismic Retrofit Account established in the State Transportation Fund under Section 188.12.

(c) “Bank” means the California Infrastructure and Economic Development Bank established under Section 63021 of the Government Code.

(d) “Bay area bridges” means the state-owned toll bridges in the region within the area of the jurisdiction of the Metropolitan Transportation Commission.

(e) “Bonds” has the meaning defined in subdivision (e) of Section 63010 of the Government Code.

(f) “Department” means the Department of Transportation.

(g) “TIFIA” means the federal Transportation Infrastructure Finance and Innovation Act of 1998 (P.L. 105-178).

(h) “Toll surcharge” means the seismic retrofit surcharge imposed under Section 31010.

Bay Area Toll Authority Toll Bridge Seismic Retrofit Account California Infrastructure Bank Bay Area bridges Metropolitan Transportation Commission Department of Transportation TIFIA seismic retrofit surcharge state-owned toll bridges transportation infrastructure Transportation Finance Act federal Infrastructure Act

(Added by Stats. 2001, Ch. 907, Sec. 5. Effective January 1, 2002.)

Section § 31070.7

The department is entirely responsible for finishing all projects that strengthen bay area bridges against earthquakes.

The department has full and sole responsibility for completion of all seismic retrofit projects on the bay area bridges.

seismic retrofit bay area bridges earthquake safety bridge strengthening infrastructure projects department responsibility seismic safety bridge projects earthquake retrofitting structural safety retrofit projects bay area infrastructure transportation safety structural reinforcement California bridges

(Added by Stats. 2001, Ch. 907, Sec. 5. Effective January 1, 2002.)

Section § 31071

This law allows a department to borrow money from a bank to cover the costs of seismic retrofit projects, which are improvements to make infrastructure more earthquake-resistant. The funds can come from bonds issued by the bank. These bonds may also cover related expenses like capitalized interest and administrative costs. The department needs to find the most cost-effective way to pay for bridge work specifically mentioned in another legal section.

The bonds will be secured by toll surcharge revenue, meaning money collected from additional fees on tolls. Before issuing these bonds, it's essential to ensure that doing so won't negatively affect existing bonds, confirmed by the ratings they have. If voters agree to a toll increase, this rule wouldn't apply.

(a) The department may enter into financing agreements with the bank for the purpose of borrowing funds to finance or refinance the seismic retrofit project costs identified in paragraph (4) of subdivision (a) of Section 188.5. The bank may issue bonds for this purpose, pursuant to the authority granted to it under Chapter 5 (commencing with Section 63070) of Division 1 of Title 6.7 of the Government Code, and deposit the proceeds from the bonds into the account. The amount of borrowing may be increased to fund necessary reserves, capitalized interest, interim bonds, including, but not limited to, commercial paper, costs of issuance, and administrative, financial, legal, and incidental services related to the bonds. The department shall pursue the most cost-effective and efficient financing plan for the bridge work identified in paragraph (4) of subdivision (a) of Section 188.5.

(b) To the extent provided in the governing documents, each of the bonds issued under this section shall be payable from, and secured by, all or a portion of the toll surcharge revenue in the account and the assets in that account.

(c) Prior to the issuance of bonds payable from the toll surcharge, the bank shall confirm that bonds issued under Chapter 4.3 (commencing with Section 30950) shall not be impaired solely by action taken under this section, as evidenced by confirmation of the then existing ratings on these bonds, by the rating agencies then rating the bonds. This requirement shall not apply if the voters approve an increase in the toll rate pursuant to subdivision (b) of Section 30921.

seismic retrofit bridge work funding financing agreements bond issuance toll surcharge revenue seismic retrofit costs capitalized interest cost-effective financing bond security bridge seismic improvements toll rate increase bond ratings protection interim bonds commercial paper financing

(Amended by Stats. 2004, Ch. 183, Sec. 341. Effective January 1, 2005.)

Section § 31071.3

This law says that, while a toll bridge is being built, any extra money made from tolls can only be used by the department for building and paying for upgrades to make the bridge earthquake-safe.

Notwithstanding any other provision of law, during the construction period, all revenues generated from the toll surcharge shall be available to the department only for the construction and financing purposes of the toll bridge seismic retrofit program.

toll bridge seismic retrofit construction finance toll surcharge revenue earthquake safety improvements bridge construction funding seismic safety program bridge upgrades infrastructure funding transportation department toll revenue allocation infrastructure finance seismic upgrade spending construction period surcharge allocation

(Added by Stats. 2001, Ch. 907, Sec. 5. Effective January 1, 2002.)

Section § 31071.5

This section explains that bonds issued under this chapter are not considered debts of the state or of local government entities, except for the bank itself. Instead, these bonds are paid back using the account and its assets. Each bond must clearly state this on its face.

Additionally, certain government code articles do not apply to financing provided by the bank to the department in connection with the account.

(a) Bonds issued under this chapter may not be deemed to constitute a debt or liability of the state or of any political subdivision thereof, other than the bank, or a pledge of the faith and credit of the state or of any political subdivision thereof, but shall be payable solely from the account, and the assets of the account, and the security provided by the account. All bonds issued under this chapter shall contain on the face of the bonds a statement to this effect.

(b) Notwithstanding any other provision of law, Article 3 (commencing with Section 63040) of, Article 4 (commencing with 63042) of, and Article 5 (commencing with Section 63043) of Chapter 2 of Division 1 of Title 6.7 of the Government Code do not apply to any financing provided by the bank to, or at the request of, the department in connection with the account.

bonds debt liability faith and credit assets bank financing state bonds local government entities repayment government code exemption Department financing security account assets statement on bonds

(Added by Stats. 2001, Ch. 907, Sec. 5. Effective January 1, 2002.)

Section § 31072

This statute states that any federal funds the department receives as a direct loan or credit under TIFIA are automatically allocated to the department to be used for the purposes specified in that account.

Any federal funds received by the department as a direct loan or line of credit under TIFIA are hereby appropriated to the department for transfer to the account for the purposes of that account.

federal funds direct loan line of credit TIFIA appropriated funds department transfer account purposes automatic allocation infrastructure financing transportation project funding fund utilization loan appropriation financial transfer department budget fund management

(Added by Stats. 2001, Ch. 907, Sec. 5. Effective January 1, 2002.)

Section § 31073

This law section allows the department to issue loans or financial transfers when needed to ensure there is enough cash flow to meet payment obligations connected to certain financing activities. These activities are outlined in related sections of the law.

The department may make the loans and transfers authorized under Section 14556.7 of the Government Code and Section 188.14 to provide adequate cash flow for obligation service requirements resulting from the financing authority provided under Sections 31071 and 31072.

cash flow loans financial transfers obligation service financing authority payment obligations Section 14556.7 Government Code Section 188.14 Sections 31071 and 31072 financial management department funding loan authorization financial transfers authorization financing activities

(Added by Stats. 2001, Ch. 907, Sec. 5. Effective January 1, 2002.)