RESOURCE MANAGEMENT AGENCY - J. GUERTIN 

Receive a report on implementation of Senate Bill 1 (SB1) Road Maintenance and Rehabilitation Account (RMRA) and possible impacts to the County’s Road Program if Proposition 6 is successful; and, consider adoption of a resolution opposing Proposition 6.

SBC FILE NUMBER: 105

RESOLUTION NO: 2018-74

On April 28, 2017, the Governor signed the Road Repair and Accountability Act of 2017, more commonly known as Senate Bill 1 (SB1). SB1 went into effect on November 1, 2017, enacted vehicle fees and a gas tax to provide the first significant, stable increase in state transportation funding in more than two decades. Statewide, SB1 invests more than $5 billion annually in long-term, dedicated transportation funding to rehabilitate and maintain local streets, roads, and highways, make critical, life-saving safety improvements, repair and replace aging bridges and culverts, reduce congestion and increase mobility options including bicycle and pedestrian facilities with the revenues split equally between state and local projects.

Locally, SB1 will provide $5 million annually to the region for road maintenance, public transit, and local priority transportation projects. Funding from SB1 for County roads is estimated to be approximately $1.8 million annually; essentially doubling our road maintenance funds for filling potholes and fixing local streets.

Additionally, SB1 has significant accountability and transparency provisions designed to ensure the public has full access to information on how their tax dollars are being invested. Cities and Counties must publicly adopt and submit to the California Transportation Commission a planned list of projects and year-end reporting that accounts for every single dollar of SB1 revenue.  

Prior to the passage of SB1, the County’s road maintenance had been restricted primarily to filling potholes, mowing and emergency repairs.  More substantial road maintenance and rehabilitation projects have not been undertaken for many years simply because of insufficient gas tax funds. With the passage of SB1, the County may now have the funding to reinstate some of the delayed maintenance projects. However, an SB1 repeal effort has qualified for the November 2018 ballot and is known as Proposition 6. If SB1 survives the referendum vote, staff will focus its attention on future years and will bring a five-year project plan to the Board for public review. The intent of the five-year plan will be to identify projects spread throughout the County ensuring that the County’s unincorporated road network is better maintained.  

Proposition 6 – Impacts to the County’s Road Program  

If Proposition 6 passes, the County’s road maintenance and repair program will again be trimmed down to only pothole filling and emergency repairs. Major repair and rehabilitation projects will be undertaken only when federal and state funding can be secured with grants and sufficient General Fund supplements are available for the local matching requirements.  
  
As stated above, SB1 funding has nearly doubled the County’s annual road maintenance funds. The estimated Proposition 6 revenue impact to the County by fiscal year is shown in the Estimated County Revenues attachment to this report. Over nine years, the impact to unincorporated San Benito County is $25,660,000 or an average of $2.9 million per year (not including lost grant opportunities).
    
Without adequate revenues, our ability to better maintain, operate, and improve the County’s road network will be at risk. This will lead to additional potholes, safety issues, congestion, sink holes, and impact the efficient mobility of people and goods movement. In addition, the problems become more expensive to resolve as our roads deteriorate further. For example doing preventative maintenance when a road is still in good shape will extend the life of the pavement and cost approximately $2-$4/square yard. If revenues are insufficient to do preventative maintenance and we let the roads continue to deteriorate, the cost to repair them in as short as 10-15 years could escalate to $30-$100/square yard.  In fact, many of the County’s road are already at that level.
  
In summary, the passage of Proposition 6 will directly reduce the amount of gas tax revenue available for transportation projects; indirectly reduce funds available due to loss of grants; and reduce the cost effectiveness of the remaining transportation fund expenditures due to the compromised preventative maintenance program. 

The issue of SB1 funding and Proposition 6 is a complicated one. To help provide imformation for the Board and the public, staff has provided the following documents:

·       SB1: The Road Repair & Accountability Act of 2017 Frequently Asked Questions & Answers

·       Estimated Revenues for the 58 Counties from SB1 and subset of RMRA funds.

·       Summary of Key SB 1 Provisions of Interest to Counties

·       Proposition 6: Voter Approval for Increases in Gas and Car Tax (SB1 Repeal) County Educational Tool Kit Analysis