BILL ANALYSIS
SENATE TRANSPORTATION COMMITTEE BILL NO: SB 504
SENATOR KEVIN MURRAY, CHAIRMAN AUTHOR: Kuehl
VERSION: 4/30/03
Analysis by: Steve Schnaidt FISCAL:yes
SUBJECT:
Exposition Metro Line Construction Authority.
DESCRIPTION:
This bill would create the Exposition Metro Line
Construction Authority to oversee and administer final
design and construction contracts for the completion of a
Los Angeles - Exposition light rail project from downtown
Los Angeles to the City of Santa Monica.
ANALYSIS:
The Los Angeles County Metropolitan Transportation
Authority (LACMTA) was established as the successor agency
to the Southern California Rapid Transit District and the
Los Angeles County Transportation Commission. The LACMTA
is the responsible agency for a multitude of transportation
programs and activities in the greater Los Angeles region,
including various mass transit guideway projects.
Existing law (SB 1847, Schiff, 1998), establishes the
Pasadena Metro Blue Line Construction Authority, more
recently known as the Gold Line, for the purpose of
awarding and overseeing all design and construction
contracts for completion of a light rail line from Los
Angeles to Pasadena. The authority has broad statutory
authority and all of the power necessary for planning,
acquiring, leasing, developing, owning, controlling,
designing and building the project and managing its
financing. The Pasadena Authority also has the right to
plan and construct Phase II of the light rail line to
extend it to Claremont.
This bill would establish the Exposition Metro Line
Construction Authority ("Authority") for the purpose of
awarding and overseeing final design and construction
contracts for completion of a Los Angeles - Santa Monica
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light rail project. Specifically, the bill would:
1.Specify that the Authority shall have all the powers
necessary for planning, acquiring, leasing, developing,
jointly developing, owning, controlling, using, jointly
using, disposing of, designing, procuring and building
the project.
2.Define the "project" as a light rail line extending from
the Metro Rail station at 7th and Flower Street in the
City of Los Angeles to downtown Santa Monica.
3.Specify that the Authority shall have a 5-member
governing board as follows:
a. Three members (1 each) appointed by the Los
Angeles, Santa Monica and Culver City City Councils;
b. One member appointed by the Los Angeles Board of
County Supervisors;
c. One member appointed by the LACMTA.
4.Provide that all members of the board shall serve a term
of not more than four years, with no limit on the number
of terms, and provide that the board, by a majority vote,
may appoint an alternate member for the purpose of
filling a vacancy.
5.Provide that each member of the board may be compensated
for attendance at board meetings at a rate of not more
than $150 per day with a maximum of $600 per month.
6.Authorize the board to appoint an executive director who
shall serve at the board's pleasure and who shall be
exempt from civil service, and provide that the board
shall establish the director's salary. The director
could appoint a staff or hire consultants as necessary to
carry out the duties of the Authority.
7.Specify that all contracts shall be awarded based on
price or competitive negotiation and in accordance with
state procurement law.
8.Direct the LACMTA to expeditiously enter into an
agreement with the Authority to hold all real property
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and any other project assets in trust.
9.Specify that the Authority's duties shall include:
a. Conducting financial studies, planning and
engineering necessary to complete the project;
b. Adopting an administrative code within an
unspecified time period, including a code of conduct
and a conflict of interest code for employees and
board members;
c. As necessary for final design and construction,
completion of a detailed management, implementation,
safety and financial plan. The plan must be completed
and submitted to the Governor, the Legislature and the
California Transportation Commission within an
unspecified period after the establishment of the
Authority.
1.Require that the Authority make reasonable progress in
the design and construction of the project.
2.Require the Authority and the LACMTA to enter into a
memorandum of understanding to specifically address the
ability of the LACMTA to review any significant changes
in the scope and design of the project.
3.Prohibit the Authority from encumbering any future
farebox revenues that may be generated from the operation
of the project and prohibit encumbering the project with
any obligation that is transferable to the LACMTA upon
completion of design and construction of the project.
4.Allow the Authority to accept grants, fees, allocations
and transfers of funds from other public agencies and
private entities.
5.Require that the Authority be dissolved upon completion
of construction of the light rail project, with the
LACMTA to assume responsibility for operating the project
upon dissolution of Authority.
COMMENTS:
1.According to the author, the bill is intended to fashion
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a joint powers construction authority as a single purpose
entity focused on the completion of a Los Angeles - Santa
Monica light rail line. The line would be constructed on
an existing railroad right of way - the Exposition
Boulevard corridor - within an administrative structure
and operations characterized by proponents as more
effective and more efficient than would be achieved if
the LACMTA continued to develop the light rail project in
the corridor.
The author notes that the LACMTA currently is engaged in
the pre-construction phase of a transit project in the
Exposition Boulevard (Expo) Corridor and soon will
initiate preliminary engineering and completion of the
necessary environmental clearance. Funding is said to be
committed only to the first segment (about half the
distance between downtown Los Angeles and Santa Monica),
with an estimated $401 million cost to complete the
remaining section of the alignment to Santa Monica.
The proponents assert that a key issue is how much money
is spent on the initial segment and seek to ensure that
design and construction on both segments be concurrent or
overlapping, rather that sequential, as a means of
reducing overall costs and advancing the completion date.
2.This bill closely follows the general structure and
provisions of SB 1847 (Schiff), enacted in 1998 and which
created the Pasadena Metro Blue Line Construction
Authority. The Pasadena Line project had been suspended
as part of the LACMTA's restructuring plan to comply with
additional federal funding requirements. Proponents of
SB 1847, like those of the current bill, argued that they
could complete the project in a more streamlined and less
expensive manner. The passage of SB 1847 transferred the
responsibility for the project from the LACMTA to the
Pasadena authority.
3.The LACMTA initially raised several concerns with the
proposed new Authority in this bill, including a lack of
funding for the Authority and a belief that the new
agency's creation would further fragment transportation
interests and transit responsibilities in greater Los
Angeles. The LACMTA indicated that contractor oversight
could be insufficient and that fair cost comparisons
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between LACMTA's and a new Authority's operations had not
been made. The Expo Corridor project has been
"federalized" and therefore requires a federally-approved
entity to supervise the project, which status the
proposed Authority apparently does not have.
Recent discussions and negotiations among the author,
sponsors and the LACMTA are reported to have resulted in
an agreement to share responsibilities for the
development and construction of the Exposition light rail
line. The author indicates, and the bill reflects, that
the proposed new Exposition Metro Line Construction
Authority would assume responsibility for final design
and construction contracts for completion of the project.
4.Policy Issues and Questions. The bill raises several
issues for the Committee's consideration, including:
a.Funding: Unlike SB 1847's Pasadena project, the current
bill is silent on how the Exposition Metro Authority
would be funded. No operating or project construction
funds are provided or transferred although the bill
allows the Authority to accept transfers of funds and the
author has stated that federal funding will come through
the LACMTA. The initial segment is still seeking federal
funding and it is unclear when or whether a second
segment would secure funding. Also, sponsors have
suggested that the LACMTA might initially fund and staff
the Authority, but the bill is silent in this regard.
b.Efficiency and Effectiveness: Has a clear case been made
that the LACMTA is incapable of satisfactorily
undertaking and completing the project or that the new
Authority would prove more efficient and effective in
managing the project's final phases? Could a
previously-proposed peer review panel monitor costs and
final construction just as effectively as a new agency?
c.Agency Coordination: The allocation of duties and
responsibilities between the proposed Authority and the
LACMTA appears to be a work in progress. Although the
bill now references the Authority as responsible for the
final design and construction, the bill also grants
broad, general powers to the Authority that potentially
could cover all phases of the project. Language that
more clearly delineates the powers and duties of the two
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agencies for the project likely will be necessary to
avoid future confusion or disputes in this regard.
Will the new agency deliver a project which is consistent
and compatible with the rest of the LACMTA's operations
and transit systems? The LACMTA will be responsible for
the project once completed, as well as the line's
operations, so the issue of coordination between the
entities is critical.
d.Fragmentation: Would the creation of another
construction entity for a single transit line further
fragment regional transportation responsibilities?
POSITIONS: (Communicated to the Committee before noon on
Wednesday, April 30, 2003)
SUPPORT: City of Santa Monica
OPPOSED: None received