may 11, 2009 silicon valley leadership …svlg.org/docs/archive/tpc-luc agenda packet_5-09.pdf ·...

TRANSPORTATION POLICY/HOUSING AND LAND USE COMMITTEE AGENDA

Note: * Denotes Information is Attached. of 3

MAY 11, 2009 SILICON VALLEY LEADERSHIP GROUP CONFERENCE ROOM

1:00 P.M.

1. WELCOME AND INTRODUCTIONS—1:00 2. APRIL 2009 TPC MINUTES APPROVAL*—1:03 3. TPC CONSENT CALENDAR—1:05

3a. AB 610 (CABALLERO) P3 INFORMATION CLEARINGHOUSE* Overview: AB 610 would create an information clearinghouse for state, regional and

local agencies to help them learn about and craft effective public private partnerships.

Action: Support AB 610 (Caballero), P3 Information Clearinghouse.

3b. AB 1135 (SKINNER) VEHICLE MILES TRAVELED DATA COLLECTION*

Overview: AB 1135 would require the Department of Motor Vehicles to collect

odometer readings annually with vehicle registrations. The mileage data would help planners and decision makers develop effective land‐use and transportation infrastructure policies.

Action: Support AB 1135 (Skinner), Vehicle Miles Traveled Data Collection.

4. TRANSPORTATION FUNDING PRIMER (TPC)—1:10 Overview: VTA staff will give TPC an overview of transportation funding at the federal level.

Action: None—Informational Item.

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5. HOT LANE BILL UPDATE (TPC)—1:50 Overview: VTA and MTC staff will give the TPC an update on pending HOT Lane

legislation, AB 744 (Torrico), that will create a HOT lane network throughout the Bay Area.

Action: None—Informational Item.

6. PARKING REFORM BILLS—SB 425, SB 518 AND SB 728 (TPC and LUC)*—2:00

Overview: TPC and LUC will discuss three bills aimed at reducing driving by eliminating employee subsides for parking.

Action: Consider supporting SB 425 (Simitian), SB 518 (Lowenthal), and SB 728

(Lowenthal).

7. DIRIDON AREA BUILDING HEIGHTS AND MINETA INTERNATIONAL AIRPORT (TPC and LUC)*—2:45

Overview: The Committees will consider the impact of development plans in the Diridon

Station Area on SJC.

Action: Recommend the Leadership Group encourage the City of San Jose to maximize development in the Diridon Area without adversely affecting Mineta International Airport’s (SJC) ability to attract and keep air service that meets the needs of Silicon Valley’s residents and business community.

8. PROPOSED A’S STADIUM IN SAN JOSE (LUC)*—3:15

Overview: The Leadership Group supports bringing a Major League Baseball team to San

Jose. The Committee will discuss the potential impacts of a new baseball stadium development in the Diridon Station Area.

Action: Recommend to Working Council that the Leadership Group take a position on the proposed Major League Baseball Stadium south of the Diridon Station.

Note: * Denotes Information is Attached. Page 2 of 3

9. CA REDEVELOPMENT COALITION – MAIN STREET RECOVERY PLAN (LUC)*—3:45 Overview: LUC will discuss joining the Redevelopment Coalition to protect redevelopment

funds from the state. Action: Recommend that the Leadership Group join the Redevelopment Coalition.

10. APRIL 2009 LUC MINUTES APPROVAL*—3:59 11. SVE3 HOUSING FUND UPDATE – HOUSING TRUST TAX CREDIT PROPOSAL ‐ Floater 12. ADJOURNMENT—4:00

TRANSPORTATION POLICY COMMITTEE MINUTES

Transportation Policy Committee – April 6, 2009 Page 1

APRIL 6, 2009 MEETING SILICON VALLEY LEADERSHIP GROUP CONFERENCE ROOM, SAN JOSE, CA

1:30 P.M. 1. WELCOME AND INTRODUCTIONS The meeting was called to order at 1:35 p.m.

Committee Members: Daniel McCoy, Genentech, co-chair Kerry Haywood, Representing NetApp, co-chair Richard Poppen, deCarta Angus Davol, Stanford University Gabrielle Karmon, SVB Financial Group Paul Shepherd, Cargill Salt Tony Fisher, Representing NUMMI Robert Kemp, University of California, Santa Cruz Sven Thesen, Better Place Tai Itani, Oracle Staff: Bena Chang, Senior Associate of Transportation and Housing Sean Kagiyama, Transportation Policy Coordinator

2. CALTRAIN/SAMTRANS UPDATE Seamus Murphy and Kim Levy of Samtrans gave the Committee an update on current and

upcoming projects. Highlights include:

• The Caltrain Board approved an agreement with the California High Speed Rail Authority (HSRA) to establish a partnership for planning and construction of the high speed rail line that will serve the needs of both Caltrain and HSR.

• HSRA is studying track design alternatives. However, the agreement specifies project

must not interrupt current service.

• Following the passage of Proposition 1A, Caltrain electrification is being planned to accommodate HSR.

ITEM 2


3. TRANSPORTATION FUNDING

Kurt Evans from VTA gave the Committee an overview of transportation funding at the local and state level. Comments include:

• Local, state, and federal sources provide $20 billion a year for transportation in California.

• Local funds pay for transit operating costs, the state funds highway improvements

and maintenance, and federal dollars mostly fund capital improvements.

• The Transportation Development Act (TDA) of 1971 shifted ¼¢ of sales tax from the state general fund to counties for public transit and bike/pedestrian improvements. VTA and local cities receive $80 million a year from TDA.

• Proposition 42 shifted the sales tax on gas from the state general fund to the

Transportation Investment Fund (TIF). TIF funds congestion relief and goods movement projects, local streets, State Transportation Improvement Program (STIP), and the Public Transportation Account (PTA). Under the new budget, PTA has been suspended for 4 years.

4. SB 518 (LOWENTHAL) PARKING REFORM BILL

Mark Stivers, staff from Senator Lowenthal’s office provided the Committee with an overview of SB 518. Highlights of the presentation included:

• SB 518 prohibits state funds from subsidizing parking. • The bill would establishe a menu of parking reform policies local governments can

adopt. The bill would require 20 points worth of reform.

Comments from the Committee’s included:

• The private sector should not be subject to mandates. • If done well, the bill could have a positive effect. If not, it could push companies out

of California.

The Committee will continue its discussion on parking reform bills in the May TPC meeting.


5. MARCH 2009 MINUTES APPROVAL

Motion—M/S Richard Poppen/Tony Fisher—Carried 10-0 (1 abstention)—Approved the minutes of the March 2009 meeting.

6. PLUG-IN VEHICLES PROGRAM UPDATE

The Committee approved the revised program to move forward.

7. CALENDAR & NEXT MEETING

The next Transportation Policy Committee meeting will be a special joint meeting with the Housing & Land Use Committee. The meeting is scheduled for Monday, May 11, 2009 at 1:00 p.m. at the Leadership Group offices.

8. ADJOURNMENT—The meeting was adjourned at 3:40 p.m.

Silicon Valley Leadership Group Memorandum

DATE: April 28, 2009 TO: Transportation Policy Committee FROM: Peter Skinner, Director of Transportation and Land Use SUBJECT: AB 610 (CABALLERO) P3 INFORMATION CLEARINGHOUSE ACTIONSupport AB 610 (Caballero), P3 Information Clearinghouse. BACKGROUND Public‐private partnerships (P3s) are contractual agreements between public agencies and private companies to design, build, finance, operate and/or maintain infrastructure projects that traditionally would have been the sole responsibility of the public sector. The Leadership Group has long been a champion of P3’s, but until recently, the ability to use them in California was very limited. With the passage of the State budget in February, State and regional government agencies now have unlimited authority to use P3’s until 2017. However, because they are relatively uncommon in the U.S., there is little information about how and when P3s can be used and insufficient technical and legal expertise to craft P3 agreements that fully protect the public interest. ANALYSIS To help agencies take advantage of this new authority, resources are needed to help craft P3’s. AB 610 (Caballero) would provide those resources by creating an information clearinghouse through the State Office of Planning and Research to advise and educate government agencies. A copy of AB 610 is included as Attachment A. Specifically, this bill would require the clearinghouse to: • Develop guidelines to assist agencies in developing procurement agreements. • Provide information through seminars, factsheets and other materials. • Establish a website to post information. • Link agencies with technical and legal resources to craft successful P3’s to

protect public interests.

ITEM 3a

Transportation Policy Committee Page 2 of 2

FISCAL IMPACT No analysis has been conducted regarding the fiscal impact to the state. Assembly Member Caballero’s office envisions the clearing house would be operated through existing resources within the State Office of Planning and Research. SUPPORT AND OPPOSITION The Committee supported a similar bill last year from Assembly Member Caballero (AB 1756), but it did not pass committee. A copy of the brief regarding AB 1756 is included as Attachment B. AB 610 is currently supported by the Valley Transportation Authority (VTA). No opposition is on record at this time. Attachments: A. Copy of AB 610 B. Brief on AB 1756

california legislature—2009–10 regular session

ASSEMBLY BILL No. 610

Introduced by Assembly Member Caballero

February 25, 2009

An act to add Section 65040.15 to the Government Code, relating tolocal government.

legislative counsel’s digest

AB 610, as introduced, Caballero. Local infrastructure.Existing law provides that the Office of Planning and Research within

the Governor’s office serves as the state’s comprehensive planningagency in the formulation, evaluation, and updating of, among otherthings, long-range goals and policies for land use, population growthand distribution, urban expansion, development, open space, resourcepreservation and utilization, air and water quality, and other factors thatshape statewide development patterns and significantly influence thequality of the state’s environment.

This bill would require the Office of Planning and Research to adviseand educate local agencies and other interested stakeholders about therole that public-private partnerships can play in planning, studying,designing, financing, constructing, operating, maintaining, or managinglocal infrastructure projects.

Vote: majority. Appropriation: no. Fiscal committee: yes.

State-mandated local program: no.

The people of the State of California do enact as follows:

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SECTION 1. (a) It is the intent of the Legislature that theOffice of Planning and Research assist local agencies interested

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Attachment A

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in public-private partnerships by providing information andpractical assistance that will help educate local agencies about theappropriate application of public-private partnerships to sometypes of local infrastructure projects, and help ensure thatpublic-private partnership agreements protect the public interest.

(b) It is not the intent of the Legislature to enact legislation thatbiases local agencies’ decisions about the use of a public-privatepartnership to build infrastructure, as compared with the use oftraditional procurement methods, or to promote the outsourcingof public sector jobs.

SEC. 2. Section 65040.15 is added to the Government Code,to read:

65040.15. (a) For the purposes of this section, the followingterms have the following meanings, unless the context clearlyrequires otherwise:

(1) “Adjusted private party bid” means the estimated bid by aprivate entity for an infrastructure project adjusted for risks retainedby the public sector under alternative financing and procurementand for ancillary costs.

(2) “Alternative financing and procurement (AFP)” means arange of infrastructure project delivery methods that use privateexpertise and financing to build, repair, or rebuild vitalinfrastructure, on time and on budget, while ensuring appropriatepublic control and ownership.

(3) “Estimated private sector bid” means an estimate of theexpected bid by a private entity, including financing costs, for aparticular project using alternative financing and procurementdelivery methods.

(4) “Public-private partnership” means a contractual agreementbetween a public agency and a private sector entity that utilizesprivate sector capital to study, plan, design, construct, develop,finance, maintain, rebuild, improve, repair, or operate, or anycombination thereof, infrastructure facilities, if the facilities remaina public good.

(5) “Public sector comparator” means the estimated total costs,including adjustments for risks retained and ancillary costs, to thepublic sector of delivering an infrastructure project using traditionalprocurement processes.

(6) “Value for money” means the difference between the publicsector comparator and the estimated private sector bid. A positive

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Attachment A

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value for money occurs for a project using alternative financingand procurement when the adjusted private sector bid is less thanthe public sector comparator.

(b) The Office of Planning and Research shall advise andeducate local agencies and other interested stakeholders about therole that public-private partnerships can play in planning, studying,designing, financing, constructing, operating, maintaining, ormanaging local infrastructure projects.

(c) Assistance provided by the Office of Planning and Researchpursuant to subdivision (b) shall include, but is not limited to, allof the following:

(1) Developing information that would help a local governmentalagency determine whether a local infrastructure project wouldbenefit from a public-private partnership that provides analternative financing and procurement approach. This informationmay include, but is not limited to, all of the following:

(A) A description of the kinds of private party participation thatcould be subject to an agreement, including, but not limited to,study, planning, finance, design, construction, operations,maintenance, or management.

(B) A public sector comparator to be used in conjunction withan estimated private sector bid to help the local agency determinewhether an alternative financing and procurement approach wouldresult in a positive value for money, or whether the agency wouldreceive greater value by pursuing a traditional public sectorprocurement approach.

(C) Guidelines to assist local agencies in following processesthat incorporate the following principles in all alternative financingand procurement agreements:

(i) The public interest is paramount.(ii) Value for money must be demonstrable.(iii) Appropriate public control and ownership must be

preserved.(iv) Accountability must be maintained.(v) All processes must be transparent while protecting the

confidentiality of trade secrets.(D) Information regarding the state’s goal of reducing

greenhouse gases by 25 percent by the year 2020, and the role, ifany, that well-designed and innovative infrastructure can play inhelping to achieve that goal.

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(E) Case studies of the use of public-private partnerships incompleted public infrastructure projects, including case studies ofprojects in which public sector employees retained their jobs orotherwise benefited from the project.

(2) Providing the information described in paragraph (1) to localagencies and other interested stakeholders through educationalseminars, factsheets, and other materials.

(3) Serving as a clearinghouse of information regarding the useof public-private partnerships in infrastructure projects in this stateand elsewhere. Specific clearinghouse functions may include, butare not limited to, the following:

(A) Establishing an Internet Web site to post informationregarding local agency public-private partnership projects.

(B) Establishing a service to link local agencies with technicaland legal resources to assist in developing and evaluating requestsfor proposals for public-private partnership projects and to assistin structuring agreements to protect a local agency’s interests in apublic-private partnership.

SEC. 3. Except as it adds Section 65040.15 to the GovernmentCode, nothing in this act shall be construed to affect the applicationof any other law.

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Attachment A

TO: Working Council FROM: Transportation Policy Committee Co-Chairs David Esmaili, West Valley-Mission College and Lauri Moss, SVB Financial Group and Laura Stuchinsky, Leadership Group, Sr. Director, Transportation and Land Use RE: AB 1261 (Caballero) Public-Private Partnership Financing & AB 1756 (Caballero) Office of Public-Private Partnership ACTION: Consider adopting the Transportation Policy Committee’s recommendation that the Leadership Group take a support position on AB 1261 and AB 1756, two bills by Assemblymember Caballero that would grant local governments greater authority to use public-private partnerships to fund infrastructure projects in their communities. BACKGROUND Public-private partnerships (P3s) are contractual, risk-sharing agreements between public agencies and private companies to design, build, finance, operate and/or maintain infrastructure projects that traditionally would have been the sole responsibility of the public sector. Canada, Australia and the United Kingdom, among other nations, have used P3s extensively to build such things as highways, schools, hospitals, water treatment plants, courthouses and transit lines. But P3s are still relatively uncommon in the U.S., including California. In 1989 California passed AB 680, which authorized Caltrans to test the use of P3s on four transportation projects. But only two project were ultimately built: State Route 91—a 10-mile, four lane toll facility built in the median of Riverside Freeway highway in Orange County and a 12.5 mile toll road called the South Bay Expressway, which runs from the Mexican border to SR 54, near Chula Vista. The latter opened to traffic late last year. The former in December 1995. When the Route 91 Express lanes were built, Riverside Freeway was one of the most congested highways in the nation. Public reaction to the Route 91 Express lanes was quite positive initially. But that perception changed as congestion increased and a non-compete clause in the operator’s contract prohibited public transportation agencies from making capacity improvements on alternate area routes. In 2003 the Orange County Transportation Authority bought out the private operator at significant public expense. The Route 91 experience so soured many legislators against public-private partnerships that they rescinded Caltrans’ authority for the remaining two projects. Proponents of public-private partnerships say that the Route 91 Express Lanes demonstrated the feasibility of P3s. The revenue generate by the tolls paid for the cost of constructing the toll lanes and operating them. But it highlights the need for governmental agencies to have experts familiar with the complexities of negotiating these deals looking out for the public interest. There are others who are more skeptical, among them the California’s Professional Engineers in California Government or PECG, a union representing engineers, architects, land surveyors and related professionals who work for the State of California. PECG strongly opposes public-private partnerships and any alternative contracting methods, such as design-build, that might shift work from public employees to private ones. But the state budget deficit and the tremendous funding shortfall for infrastructure across a variety of sectors has some legislators re-considering P3s.

Attachment B

http://en.wikipedia.org/wiki/Chula_Vista%2C_California

ANALYSIS The Governor has proposed that the Legislation grant the state broad authority to pursue such deals and to expand the authority already available to local governments and entities. He is also proposing the creation of a governmental entity that would advise state and local agencies on the feasibility of using public-private partnerships for particular projects, and help negotiate the terms of such deals. Assemblymember Caballero is taking a slightly different approach. She is focusing exclusively on local governments. AB 1261 would revise and clarify provisions in state statute dating back to 1996 that authorize local governments to use public-private partnerships to design, build, or reconstruct certain types of fee-producing infrastructure projects. AB 1261 would clarify that local governments could also use P3s to finance infrastructure projects. AB 1756 would create an Office of Local Public-Private Partnerships within the Business, Transportation and Housing Agency, to facilitate the use of “best value” public-private partnerships by local governments. Although local governments have had the authority to use P3s for 11 years, few have exercised that option. Part of the reason, the Assemblymember reasons, is a lack of information about how and when P3s can be used and insufficient technical and legal expertise to craft P3 agreements that fully protect the public interest. Assemblymember Caballero is proposing to create a clearinghouse that would provide information to local jurisdictions about P3s and to link local agencies with experts that might assist them in evaluating and developing potential P3 contracts. The Assemblymember is still refining the details on the clearinghouse—how it would function, how it would be funded, etc. But the basic principles of both bills—granting greater authority to local agencies to use P3s and creating a mechanism for local governments to pursue such deals in a way that protects the public interest—is consistent with the Leadership Group’s stance on this issue and the Governor’s P3 initiative.

Attachment B


DATE: April 28, 2009 TO: Transportation Policy Committee FROM: Peter Skinner, Director of Transportation and Land Use SUBJECT: VEHICLE MILES TRAVELED DATA COLLECTION ACTION Support AB 1135 (Skinner), Vehicle Miles Traveled Data Collection BACKGROUND AND ANALYSIS Transportation and land‐use planners often use estimates and models to measure vehicle miles traveled (VMT). VMT estimates help guide the planning of transportation infrastructure, local zoning choices and traffic mitigations for development/ redevelopment. However, by their very nature, estimates are inherently less helpful at measuring the impact of land‐use policies or infrastructure investments that are aimed at reducing driving. Beyond estimates and models, no true VMT data is currently available. Accurate VMT data would be a major asset to planners and decision makers, giving them a better understanding of the impact of public policies and investments have on driving patterns. This allows them to make more informed choices to reduce inefficiencies and maximize public investment. To provide accurate VMT data, AB 1135 would require motorists to submit odometer readings annually to the Department of Motor Vehcies (DMV) when registering their vehicle. The DMV would then make mileage data available on their website. Data would be provided by census block and no personal information would be released to the public, protecting individual’s right to privacy. A copy of AB 1135 is included as Attachment A.

ITEM 3b

Transportation Policy Committee Page 2 of 2

The Leadership Group strongly supports transportation and land‐use policies and investments that reduce driving and greenhouse gas emissions. To that end, VMT data will give regional planning agencies across the state, including the Metropolitan Transportation Commission (MTC), the data they need to identify the most robust strategies to meet SB 375 and AB 32 goals. With transportation accounting for 40% of green house gas emissions in California, 51% in the Bay Area, significant reductions in VMT, combined with advancements in vehicle technology (e.g. plug in vehicles), will be necessary to meet state mandates. FISCAL IMPACT No analysis has been conducted regarding the fiscal impact to the state. However, the cost of collecting and posting the information could potentially be absorbed using existing DMV resources. SUPPORT AND OPPOSITION AB 1135 is sponsored and supported by TRANSFORM (formerly TALC), who has asked the Leadership Group for support. The bill is also supported by many other groups and agencies, including: the Sierra Club, the American Lung Association, the Metropolitan Transportation Commission (MTC) and the Bay Area Air Quality Management District (BAAQMD). No opposition is on record at this time. Attachments: A. Copy of AB 1135

AMENDED IN ASSEMBLY APRIL 13, 2009

california legislature—2009–10 regular session

ASSEMBLY BILL No. 1135

Introduced by Assembly Member Skinner

February 27, 2009

An act to amend Section 4602 of the Vehicle Code, relating tovehicles.


AB 1135, as amended, Skinner. Vehicles: registration renewal.Existing law requires an owner of a vehicle to submit an application

for renewal of a vehicle registration to the Department of Motor Vehiclesno later than midnight of the expiration date.

This bill would require the owner of a vehicle, upon application forrenewal of a vehicle registration, to report the current odometer readingof the vehicle. The bill would require that information, except for thename and address of the vehicle owner and the vehicle license platenumber, to be public information. The bill would also require thedepartment to group the information into census blocks, create adatabase that can compile census block data and sort it by block group,census tract, and city and county, and post the data on the department’sInternet Web site.




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SECTION 1. The Legislature finds and declares all of thefollowing:

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(a) To assist in achieving California’s climate change policyobjectives as these relate to the state’s transportation planninggoals, it is evident that better information about greenhouse gasemissions from motor vehicles will be essential.

(b) The current use of estimates and models for measuring themiles driven and the resulting emissions from those miles drivenhave been historically useful, but are considered generallyinadequate for providing the specific transportation needs of thefuture.

(c) More accurate data about vehicle-miles-traveled—themileage driven annually by Californians—would provide essentialinformation to guide local transportation and land use planning.Location of transit corridor improvements, light rail, bicycle paths,and high-occupancy freeway lanes now depend on the estimatesdone by various state agencies, but all of these projects wouldbenefit from more accurate data. Better data would also providemore consistent local and statewide estimates for transportationplanning, city planning, and air quality planning efforts. The datawould be essential in establishing long-term, historical trends invehicle use, traffic congestion, energy consumption, and air qualitymeasures, including ozone precursor pollutants and greenhousegases.

(d) Mobile source emissions estimates would be improved dueto the detailed information on vehicle-miles traveled by vehicleage. Newer vehicles tend to be cleaner, yet are driven more thanolder vehicles. This data would be of critical importance to theState Air Resources Board and local air districts in monitoringfleet turnover, and the efficacy of tailpipe controls in reducingcriteria pollutants and greenhouse gases.

(e) Transportation planning models would be improved due todetailed information on vehicle-miles traveled by neighborhoodfor each registered vehicle. Vehicles owned by urban householdstend to be driven less than vehicles owned in suburban and ruralneighborhoods. This consistent statewide database would be criticalin identifying trends in vehicle usage in the rural, suburban, andurban neighborhoods in California.

SEC. 2. Section 4602 of the Vehicle Code is amended to read:4602. (a) Application for renewal of a vehicle registration

shall be made by the owner not later than midnight of the expirationdate, and shall be made by presentation of the registration card

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last issued for the vehicle or by presentation of a potentialregistration card issued by the department for use at the time ofrenewal and by payment of the full registration year fee for thevehicle. If the registration card and potential registration card areunavailable, a fee as specified in Section 9265 shall not be paid.

(b) At the time of application for renewal of a vehicleregistration, the owner shall report the current odometer reading.This information, except for the name and address of the vehicleowner and license plate number of the vehicle, shall be publicinformation.

(c) The department shall group the information into censusblocks, as defined by the United States Census Bureau, and createa database that can compile the census block data and sort thedata by block group, census tract, and city and county. The datashall be made available on the department’s Internet Web site onan annual basis.

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Attachment A

SILICON VALLEY LEADERSHIP GROUP MEMORANDUM

DATE: April 30, 2009 TO: Transportation Policy Committee Housing and Land Use Committee FROM: Sean Kagiyama, Transportation Policy Coordinator Peter Skinner, Director of Transportation and Land Use SUBJECT: PARKING REFORM BILLS—SB 425, SB 518 AND SB 728 ACTION Consider supporting SB 425 (Simitian), SB 518 (Lowenthal), and SB 728 (Lowenthal). BACKGROUND Free parking is argued to increase vehicle trips, which contribute to elevated congestion and greenhouse gas emissions. Parking expands the built environment leading to increased sprawl and decreased appeal of alternative modes of transportation such as bicycling and walking. The bills the Committee will consider propose limiting free parking to encourage commute trip reductions. These bills were introduced during the current legislative session. SB 425 and SB 728 deal with the parking cash out program that has been required by state law since 1992. Employers that lease parking often provide these spaces for free as a benefit to their employees. The parking cash out law requires employers who subsidize parking for 50 or more employees to offer cash to an employee who chooses not to use a parking space. Although parking cash out programs are required, lack of enforcement has lead to non-compliance by employers. The third bill, SB 518 addresses state funds being used to construct and operate parking facilities. By prohibiting state subsidies on parking, the bill attempts to reveal the actual costs of parking. Current state law prohibits the University of California and the California State University from subsidizing parking. This bill would extend the regulation to community colleges.

ITEM 6

April 30, 2009 Page 2 of 3 ANALYSIS Below are brief explanations of each bill. In addition to review and discussion by the Transportation Policy Committee and the Housing and Land Use Committee, the bills will be considered by Working Council on May 14. The position of the Committees will be provided to Working Council as part of staff’s presentation. SB 425 (Simitian) This bill would establish a method to enforce the parking cash out law. The Franchise Tax Board would amend the tax code to disqualify corporate tax deductions of parking expenses if employers are not compliant with parking cash out requirements. Revenue gained from disallowed deductions would fund a tax credit provided to small businesses with up to 20 employees to establish a commute trip reduction program. The credit would cover 80 percent of the costs needed to subsidize vanpools, monthly transit passes, and facility improvements to encourage bicycling. No formal support or opposition is on record. A copy of SB 425 and the fact sheet are included as Attachments 1 and 2. SB 518 (Lowenthal) This bill would prohibit state funds from being used to subsidize the construction or operation costs of parking with certain exceptions, such as a park and ride facility serving public transit. By January 1, 2012, local governments would be required to adopt 20 points of parking policy changes from a menu of reforms. Cities that enact 50 points of reform would receive a bonus of 5% of the available points in a competitive state loan or grant program. Policy reforms from the menu include:

Eliminate/reduce minimum parking requirements. Adopt ordinance which requires employers to provide transit passes to all

employees on a pre-tax basis. Adopt ordinance that allocates revenue from public parking to public transit,

Transportation Demand Management, bicycle infrastructure improvements, etc. SB 518 is supported by the Natural Resources Defense Council, American Lung Association, California League of Conservation Voters, Genentech, Housing California, Non-Profit Housing Association of Northern California, Planning and Conservation League, and Transform. The bill is opposed by the California Community College League and Riverside Community College District. A copy of SB 518 and the fact sheet are included as Attachments 3 and 4.

April 30, 2009 Page 3 of 3 SB 728 (Lowenthal) This bill would amend Section 43845 of the California Health and Safety Code. The California Air Resources Board would be authorized to impose penalties for violations of the existing Parking cash out law. The bill would also authorize cities, counties, and local air districts to adopt penalties to employers within their jurisdiction not in compliance with the law. Funds collected from violators could be used to support alternative transportation programs. According to staff from Senator Lowenthal’s office, employees have complained about non-compliance of the parking cash out program, but the California Air Resources Board (CARB) has not issued any citations. The City of Los Angeles attempted to enforce the program, but lacked the legal authority. SB 728 is sponsored by the Environmental Defense Fund and the Natural Resources Defense Council. No formal opposition is on record. A copy of SB 728 is included as Attachment 5. CONCLUSION The Leadership Group strongly supports smart growth and alternative modes of transportation. Parking reform may lead to more sustainable land use, preventing urban sprawl and encouraging transit use, carpooling, walking and biking. Attachments:

1. SB 425 2. SB 425 Fact Sheet 3. SB 518 4. SB 518 Fact Sheet 5. SB 728

AMENDED IN SENATE APRIL 16, 2009


SENATE BILL No. 425

Introduced by Senator Simitian

February 26, 2009

An act to add Sections 17053.58, 17284, 23658, and 24343.1 to theRevenue and Taxation Code, relating to taxation, to take effectimmediately, tax levy.


SB 425, as amended, Simitian. Personal and corporate income taxes:deductions: parking: credits: ridesharing expenses.

The Personal Income Tax Law and the Corporation Tax Law allowvarious deductions in computing the income that is subject to the taxesimposed by those laws. Existing law allows an employer to deduct itsexpenses in carrying out a parking subsidy and a parking cash-outprogram, as defined, for employees.

This bill would disallow a deduction for expenses of specifiedemployers for parking subsidies unless all employees provided with aparking subsidy are offered a parking cash-out program in accordancewith a specified statute.

The Personal Income Tax Law and Corporation Tax Law authorizevarious credits against the taxes imposed by those laws.

This bill would authorize a credit under both those laws, for taxableyears beginning on or after January 1, 2009, in an amount not to exceed$1,500 for qualified commute reduction expenditures, as defined, forspecified small-business taxpayers.

This bill would take effect immediately as a tax levy.

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Attachment 1




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SECTION 1. Section 17053.58 is added to the Revenue andTaxation Code, to read:

17053.58. (a) For taxable years beginning on or after January1, 2009, there shall be allowed to a taxpayer as a credit against the“net tax,” as defined in Section 17039, an amount equal to 80percent of the costs paid or incurred during the taxable year by thetaxpayer for qualified commute reduction expenditures, not toexceed one thousand five hundred dollars ($1,500).

(b) For purposes of this section:(1) “Buspool” means 16 or more persons commuting on a daily

basis to and from work by means of a vehicle with a seatingarrangement designed to carry more than 15 adult passengers.

(2) “Carpool” means two or more persons commuting on a dailybasis to and from work by means of a vehicle with a seatingarrangement designed to carry less than seven adults, includingthe driver.

(3) “Employee” means a person employed by the taxpayer ona full-time basis, who performs, at a minimum, 30 hours per weekfor compensation.

(4) “Private commuter bus” means a highway vehicle whichmeets all of the following criteria:

(A) Has a seating capacity of at least seven adults, includingthe driver.

(B) At least 50 percent of the mileage of which can bereasonably expected to be used for the purpose of transportingemployees to and from work.

(C) Is acquired by the taxpayer on or after the date of enactmentof this section.

(D) With respect to which the taxpayer makes an election underthis paragraph on his or her return for the taxable year in whichthe vehicle is placed in service.

(5) “Qualified commute reduction expenditure” means costspaid or incurred by the taxpayer for any of the following:

(A) Subsidizing employees commuting in vanpools.

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(B) Subsidizing employees commuting in private commuterbuses or buspools.

(C) Subsidizing monthly transit passes for its employees or foruse by the employee’s dependents, except that no deduction shallbe allowed for transit passes issued for the use of elementary andsecondary school students.

(D) Subsidizing employees commuting in subscription taxipools.(E) Subsidizing employees commuting in a carpool.(F) Subsidizing employees commuting in a ferry.(G) Providing free or subsidized parking to carpools, vanpools,

or any other vehicle used in a ridesharing arrangement withinCalifornia.

(H) Making facility improvements to encourage employees, forthe purpose of commuting from their homes, to use bicycles.

(I) Making facility improvements to encourage employees to,or subsidizing employees who already use, an alternativetransportation method, other than a method specified in thisparagraph, that reduces the use of a motor vehicle by a singleoccupant to travel to or from that employee’s place of employment.

(J) Subsidizing employees who travel to or from atelecommuting facility.

(6) “Subscription taxipool” means a type of service in whichemployers or groups of employees contract with a public or privatetaxi operator to provide daily commuter service for a group ofpreassembled subscribers on a prepaid or daily fare basis followinga relatively fixed route and schedule tailored to meet the needs ofthe subscribers.

(7) “Taxpayer” means a person or entity engaged in a trade orbusiness within California who employs a maximum of 20employees. “Taxpayer” shall not include the state, a county, a city,a city and county, a special district as defined in Section 12712 ofthe Government Code, a school district, a community collegedistrict, the California State University system, or the Universityof California.

(8) “Transit” means transportation service for use by the generalpublic that utilizes buses, railcars, or ferries with a seating capacityof 16 or more persons.

(9) “Transit pass” means any purchase of transit rides thatentitles the holder to any number of transit rides to and from theworkplace, whether at a discount rate or the base fare rate.

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(10) “Vanpool” means seven or more persons commuting on adaily basis to and from work by means of a vehicle with a seatingarrangement designed to carry 7 to 15 adults, including the driver,that is used to transport those persons who commute to and fromwork on a regular basis.

(c) This credit shall be in lieu of any other deduction which thetaxpayer may otherwise claim pursuant to this part with respect tothe costs paid or incurred during the taxable year by the taxpayerfor qualified commute reduction expenditures.

(d) The aggregate amount of credit that may be allowed in anyfiscal year pursuant to this section and Section 23658 shall be anamount equal to the aggregate revenue increase attributable in thatsame fiscal year to Sections 17284 and 24343.1.

(e) (1) The Franchise Tax Board shall allocate the credit to thetaxpayer on a first-come, first-served basis.

(2) The taxpayer shall claim the credit on a timely filed originalreturn.

(3) The date a return is received shall be determined by theFranchise Tax Board.

(4) The determinations of the Franchise Tax Board with respectto the date a return is received for purposes of this subdivisionmay not be reviewed in any administrative or judicial proceeding.

(f)(d) The Franchise Tax Board may prescribe rules, guidelines,

or procedures necessary or appropriate to carry out the purposesof this section, including any guidelines regarding the allocationof the credit allowed under this section. Chapter 3.5 (commencingof this section. Chapter 3.5 (commencing with Section 11340) ofPart 1 of Division 3 of Title 2 of the Government Code does notapply to any rule, guideline, or procedure prescribed by theFranchise Tax Board pursuant to this section.

(g)(e) In the case where a credit allowed under this section exceeds

the “net tax,” the excess credit may be carried over to reduce the“net tax” in the following taxable year, and succeeding taxableyears, if necessary, until the credit has been exhausted.

SEC. 2. Section 17284 is added to the Revenue and TaxationCode, to read:

17284. (a) For taxable years beginning on or after January 1,2009, no deduction is allowed under this part for amounts paid or

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incurred by an employer subject to Section 43845 of the Healthand Safety Code for parking subsidies unless all employees of theemployer provided with a parking subsidy are offered a parkingcash-out program in accordance with Section 43845 of the Healthand Safety Code.

(b) For purposes of this section, “parking subsidy” and “parkingcash-out program” have the same meaning as defined in Section43845 of the Health and Safety Code.

SEC. 3. Section 23658 is added to the Revenue and TaxationCode, to read:

23658. (a) For taxable years beginning on or after January 1,2009, there shall be allowed to a taxpayer as a credit against the“tax,” as defined in Section 23036, an amount equal to 80 percentof the costs paid or incurred during the taxable year by the taxpayerfor qualified commute reduction expenditures, not to exceed onethousand five hundred dollars ($1,500).

(b) For purposes of this section:(1) “Buspool” means 16 or more persons commuting on a daily

basis to and from work by means of a vehicle with a seatingarrangement designed to carry more than 15 adult passengers.

(2) “Carpool” means two or more persons commuting on a dailybasis to and from work by means of a vehicle with a seatingarrangement designed to carry less than seven adults, includingthe driver.

(3) “Employee” means a person employed by the taxpayer ona full-time basis, who performs, at a minimum, 30 hours per weekfor compensation.

(4) “Private commuter bus” means a highway vehicle whichmeets all of the following criteria:

(A) Has a seating capacity of at least seven adults, includingthe driver.

(B) At least 50 percent of the mileage of which can bereasonably expected to be used for the purpose of transportingemployees to and from work.

(C) Is acquired by the taxpayer on or after the date of enactmentof this section.

(D) With respect to which the taxpayer makes an election underthis paragraph on his or her return for the taxable year in whichthe vehicle is placed in service.

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(5) “Qualified commute reduction expenditure” means costspaid or incurred by the taxpayer for any of the following:

(A) Subsidizing employees commuting in vanpools.(B) Subsidizing employees commuting in private commuter

buses or buspools.(C) Subsidizing monthly transit passes for its employees or for

use by the employee’s dependents, except that no deduction shallbe allowed for transit passes issued for the use of elementary andsecondary school students.

(D) Subsidizing employees commuting in subscription taxipools.(E) Subsidizing employees commuting in a carpool.(F) Subsidizing employees commuting in a ferry.(G) Providing free or preferential parking to carpools, vanpools,

or any other vehicle used in a ridesharing arrangement withinCalifornia.

(H) Making facility improvements to encourage employees, forthe purpose of commuting from their homes, to use bicycles.

(I) Making facility improvements to encourage employees to,or subsidizing employees who already use, an alternativetransportation method, other than a method specified in thisparagraph, that reduces the use of a motor vehicle by a singleoccupant to travel to or from that employee’s place of employment.

(J) Subsidizing employees who travel to or from atelecommuting facility.

(6) “Subscription taxipool” means a type of service in whichemployers or groups of employees contract with a public or privatetaxi operator to provide daily commuter service for a group ofpreassembled subscribers on a prepaid or daily fare basis followinga relatively fixed route and schedule tailored to meet the needs ofthe subscribers.

(7) “Taxpayer” means a person or entity engaged in a trade orbusiness within California who employs a maximum of 20employees. “Taxpayer” shall not include the state, a county, a city,a city and county, a special district as defined in Section 12712 ofthe Government Code, a school district, a community collegedistrict, the California State University system, or the Universityof California.

(8) “Transit” means transportation service for use by the generalpublic that utilizes buses, railcars, or ferries with a seating capacityof 16 or more persons.

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(9) “Transit pass” means any purchase of transit rides thatentitles the holder to any number of transit rides to and from theworkplace, whether at a discount rate or the base fare rate.

(10) “Vanpool” means seven or more persons commuting on adaily basis to and from work by means of a vehicle with a seatingarrangement designed to carry 7 to 15 adults, including the driver,that is used to transport those persons who commute to and fromwork on a regular basis.

(c) This credit shall be in lieu of any other deduction which thetaxpayer may otherwise claim pursuant to this part with respect tothe costs paid or incurred during the taxable year by the taxpayerfor qualified commute reduction expenditures.

(d) The aggregate amount of credit that may be allowed in anyfiscal year pursuant to this section and Section 17053.58 shall bean amount equal to the aggregate revenue increase attributable inthat same fiscal year to Sections 17284 and 24343.1.

(e) (1) The Franchise Tax Board shall allocate the credit to thetaxpayer on a first-come, first-served basis.

(2) The taxpayer shall claim the credit on a timely filed originalreturn.

(3) The date a return is received shall be determined by theFranchise Tax Board.

(4) The determinations of the Franchise Tax Board with respectto the date a return is received for purposes of this subdivisionmay not be reviewed in any administrative or judicial proceeding.

(f)(d) The Franchise Tax Board may prescribe rules, guidelines,

or procedures necessary or appropriate to carry out the purposesof this section, including any guidelines regarding the allocationof the credit allowed under this section. Chapter 3.5 (commencingof this section. Chapter 3.5 (commencing with Section 11340) ofPart 1 of Division 3 of Title 2 of the Government Code does notapply to any rule, guideline, or procedure prescribed by theFranchise Tax Board pursuant to this section.

(g)(e) In the case where a credit allowed under this section exceeds

the “tax,” the excess credit may be carried over to reduce the “tax”in the following taxable year, and succeeding taxable years, ifnecessary, until the credit has been exhausted.

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SEC. 4. Section 24343.1 is added to the Revenue and TaxationCode, to read:

24343.1. (a) For taxable years beginning on or after January1, 2009, no deduction is allowed under this part for amounts paidor incurred by an employer subject to Section 43845 of the Healthand Safety Code for parking subsidies unless all employees of theemployer provided with a parking subsidy are offered a parkingcash-out program in accordance with Section 43845 of the Healthand Safety Code.

(b) For purposes of this section, “parking subsidy” and “parkingcash-out program” have the same meaning as defined in Section43845 of the Health and Safety Code.

SEC. 5. This act provides for a tax levy within the meaning ofArticle IV of the Constitution and shall go into immediate effect.

O

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Attachment 1

Fact Sheet: Senate Bill 425 (Simitian) As amended April 15, 2009

Transportation Demand Management Strategies SB 425: Summary

This bill authorizes the Franchise Tax Board (FTB) to disallow a deduction of parking expenses

for businesses that are not compliant with state parking cash out requirements. The funds gained from

disallowed deductions will be given as tax credits to small businesses to help California’s small

businesses implement and maintain commute trip reduction strategies.

Need for the Bill

Under existing state law, a parking cash out program has been required of qualifying employers

since 1992 (AB 2109, Katz). Current law requires a certain class of employers to offer their employees

cash in lieu of subsidized parking. “Free” parking has significant social, economic and environmental

costs, and parking cash out is one of the least onerous and most equitable methods by which the true

cost of subsidized parking can be seen. Although the California Air Resources Board (ARB) is the

agency responsible for implementing and regulating the parking cash-out statute, existing law does not

require the ARB to enforce or monitor the program; nor does current law contain reporting

requirements for employers, making it difficult for the ARB to assess compliance.

The potential of parking cash out to alleviate congestion and reduce greenhouse gas emissions

necessitates the use of methods of assessing employer compliance with the existing parking cash out

statute. However, truly addressing congestion and transportation demand requires a multifaceted focus

that also provides incentives to small businesses to engage in commute trip reduction.

What the Bill Does

• Provides a clearer method of enforcement for parking cash out by instructing the FTB to deny

deductibility for parking as a business expense if the employer is not compliant with existing

parking cash out; and,

• Provides that any revenue generated by denied deductions should be allocated as a tax credit to

small businesses in order to give incentives for the implementation and maintenance of qualified

commute trip reduction measures.

Staff Contacts: Anand Parikh; (916) 651-4011 or [email protected]

Revised as of Tuesday, April 21, 2009.

California State Senate

SENATOR

S. JOSEPH SIMITIAN ELEVENTH SENATE DISTRICT

DISTRICT OFFICE 160 Town & Country Village

Palo Alto, CA 94301 (650) 688-6384

Fax (650) 688-6370

SATELLITE OFFICE

701 Ocean Street, Room 318A Santa Cruz, CA 95060

(831) 425-0401 Fax (831) 425-5124

STATE CAPITOL SACRAMENTO, CA 95814

(916) 651-4011 Fax (916) 323-4529

E-MAIL [email protected]

WEBSITE

http://www.sen.ca.gov/simitian

Attachment 2



SENATE BILL No. 518

Introduced by Senator Lowenthal

February 26, 2009

An act to amend Section 76360 of the Education Code, to add Section2117.5 to the Streets and Highways Code, and to amend Section 22508of, and to add Division 19 (commencing with Section 43000) to, theVehicle Code, relating to vehicles.


SB 518, as amended, Lowenthal. Vehicles: parking services and fees.(1) Existing law regulates the amount of fees that a community

college district may charge for parking and authorizes the governingboard of a community college district to require payment of a parkingfee at a campus in excess of established limits for the purpose of fundingthe construction of oncampus parking facilities if certain conditions aremet.

This bill would delete these provisions and instead require that statefunds not be used, directly or indirectly, to subsidize parking services,except as specified, for students, employees, or other persons on andafter January 1, 2011. The bill also would authorize the governing boardof a community college district to exempt specified students who receivefinancial assistance or who rideshare or carpool from paying parkingfees that exceed $20 per semester.

(2) Under existing law, the State Building Construction Act, statefunds may be used to fund the construction or operations of parkingfacilities in California. Under existing law, a city or county is authorizedto provide for the parking of motor vehicles, including the construction

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and operation of parking facilities, and the acquisition of land, property,and rights-of-way necessary or convenient for use as public parkingplaces.

This bill would prohibit, notwithstanding any other provision of lawon and after January 1, 2011, the use of state funds to, directly orindirectly, subsidize the construction or operations of parking, exceptas specified, and for this purpose, the bill would define both theconstruction and operating costs of parking, the current cost of a monthlytransit pass, the full cost of a parking space, transit intensive areas, andspecify the exceptions to this requirement. A violation of the VehicleCode is a crime.

The bill would require, on or before January 1, 2012, a city or countywithin a region covered by a metropolitan planning organization, exceptas specified, to adopt and implement, or have adopted and implemented,measures from a specified menu that achieve a total score of at least 20points, based on the points associated with that menu to ensure that acity or county manages its parking so that the actual cost of a parkingspace equals its full cost, as specified. By increasing the duties of localpublic officials, the bill would impose a state-mandated local program.

The bill also would authorize a city or county, to request the StateAir Resources Board to approve and award points for other alternatemeasures to reduce or eliminate subsidies that fail to charge users forthe full cost of a parking space, as specified. The bill also would providethat if a city or county adopts and implements measures to achieve atotal score of at least 20 points from the specified menu, the city orcounty would be eligible to receive carbon reduction credits throughthe cap-and-trade program administered by the State Air ResourcesBoard, as specified, and if at least 50 points from the specified menu,the city or county, with respect to any application for competitive loanor grant programs funded by a general obligation bond approved by thevoters on or after January 1, 2010, would receive bonus points equal to5% of the total available points.

(3) This bill would also authorize the expenditure of any moneysapportioned to cities or counties from the Highway Users Tax Accountin the Transportation Tax Fund for the adoption or implementation oftransportation demand management measures, including measuresadopted pursuant to these provisions.

(4) Existing law prohibits a local authority from establishing parkingmeter zones or fixing the rate for those zones except by ordinance.

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This bill would permit a local authority to specify by ordinance aperformance target and allow the rate of fees to be set administrativelyto achieve the performance target.

This bill would authorize a local authority to dedicate any portion ofrevenues collected from parking meter zones to benefit parking benefitdistricts or to fund programs that reduce parking demand, including,but not limited to, public transit, transportation demand management,or bicycle and pedestrian infrastructure improvements and promotion.

(5) The California Constitution requires the state to reimburse localagencies and school districts for certain costs mandated by the state.Statutory provisions establish procedures for making that reimbursement.

This bill would provide that with regard to certain mandates noreimbursement is required by this act for a specified reason.

With regard to any other mandates, this bill would provide that, if theCommission on State Mandates determines that the bill contains costsso mandated by the state, reimbursement for those costs shall be madepursuant to the statutory provisions noted above.


State-mandated local program: yes.


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SECTION 1. The Legislature finds and declares all of thefollowing:

(a) The transportation sector contributes over 40 percent of thegreenhouse gas emissions in the State of California; automobilesand light trucks alone contribute almost 30 percent. Thetransportation sector is the state’s single largest contributor ofgreenhouse gases.

(b) In 2006, the Legislature passed and the Governor signedAssembly Bill 32 (Chapter 488 of the Statutes of 2006; hereafterAB 32), which requires the State of California to reduce itsgreenhouse gas emissions to 1990 levels no later than 2020.According to the State Air Resources Board, in 1990 greenhousegas emissions from automobiles and light trucks were 108 millionmetric tons, but by 2004 these emissions had increased to 135million metric tons.

(c) Greenhouse gas emissions from automobiles and light truckscan be substantially reduced by new vehicle technology and bythe increased use of low carbon fuel. However, even taking these

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measures into account, it will be necessary to achieve significantadditional greenhouse gas reductions by reducing vehicle milestraveled. Without those reductions, California will not be able toachieve the goals of AB 32.

(d) In addition, automobiles and light trucks account for 50percent of air pollution in California and 70 percent of the state’sconsumption of petroleum. Reducing vehicle trips will also helpreduce criteria pollutant emissions that are regulated by the stateand federal Clean Air Acts and reduce the state’s dependence onpetroleum.

(e) California has five of the top 13 most traffic congestedmetropolitan areas in the United States. Pricing strategies, such asparking pricing, are the most effective way to achieve lastingreductions in traffic congestion by permanently reducing roadwaydemand. On a congested street, eliminating just 10 percent ofvehicles can result in free-flowing traffic.

(f) The existence of “free” parking is a significant factor thatencourages vehicle trips. At employment sites, employer-paidparking increases rates of driving by as much as 22 percent.Conversely, employee-paid parking reduces rates of driving bythe same amount.

(g) Excessive governmental parking requirements greatly expandthe built footprint and increase travel distances, thereby increasingvehicle miles traveled and reducing the viability of alternatetransportation modes that help to achieve the state’s greenhousegas reduction targets, including walking, bicycling, and publictransportation.

(h) Parking is costly to build and maintain. Building a structuredparking space in 2008 costs between $17,000 and $30,000, withunderground spaces costing significantly more. Annual operationsand maintenance costs vary from $100 and $500 per space peryear. The high cost of land, construction, and maintenance toprovide free parking adds significantly to the cost of economicdevelopment, making many housing and commercial developments,especially those on infill or transit-oriented sites, financiallyinfeasible and hindering economic development strategies.Moreover, when parking is provided free to the user, these costsare hidden elsewhere in the cost of doing business. Free parkingat stores is paid for by all customers in higher prices for goods,including those customers who do not drive. Free parking in

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housing developments is paid for by all residents, even those whodo not drive. Free employer-provided parking is paid for by lowerwages for all workers, including those who do not drive. Freeonstreet parking is paid for by the entire community in the formof taxes.

(i) Eliminating subsidies for parking has enormous potential toreduce traffic congestion and greenhouse gas and other vehicleemissions by reducing vehicle miles traveled. If drivers must paythe true cost of parking, it will affect their choices on whether ornot to drive. In the short term, changes to parking policy can reducetraffic congestion and greenhouse gas emissions more than allother strategies combined, and they are usually the mostcost-effective approach. Eliminating parking subsidies can alsoimprove social equity by lowering prices for those who do notdrive, that are often lower-income households.

SEC. 2. Section 76360 of the Education Code is amended toread:

76360. (a) Except as provided in subdivision (b), a communitycollege district shall not use state funds, directly or indirectly, tosubsidize the construction or operations of parking for students,district employees, or other persons on and after January 1, 2011.The construction and operations of parking are not subsidized ifparking user fees cover land and construction costs within no lessthan 15 years, and operation and maintenance costs on an annualbasis.

(b) (1) The governing board of a community college districtmay exempt students who receive financial assistance pursuant toany programs described in subdivision (g) of Section 76300 fromparking fees that exceed twenty dollars ($20) per semester.

(2) To encourage ridesharing and carpooling, the governingboard of a community college district may exempt a student whocertifies, in accordance with procedures established by the board,that he or she regularly has two or more passengers commuting tothe community college with him or her in the vehicle parked atthe community college, from parking fees that exceed thirty dollars($30) per semester and ten dollars ($10) per intersession.

(c) All parking fees collected shall be deposited in the designatedfund of the district in accordance with the California CommunityColleges Budget and Accounting Manual, and shall be expendedonly for parking services or for purposes of reducing the costs to

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students and employees of the college of using public transportationto and from the college.

(d) Fees collected for use of parking services provided for byinvestment of student body funds under the authority of Section76064 shall be deposited in a designated fund in accordance withthe California Community Colleges Budget and AccountingManual for repayment to the student organization.

(e) “Parking services,” as used in this section, means thepurchase, construction, and operation and maintenance of parkingfacilities for vehicles and motor vehicles as defined by Sections415 and 670 of the Vehicle Code.

SEC. 3. Division 19 (commencing with Section 43000) is addedto the Vehicle Code, to read:

DIVISION 19. PARKING REQUIREMENTS

43000. For the purposes of this division, the following termshave the following meaning:

(a) “Current cost of a monthly transit pass” means the mostrecent adopted rate of a monthly transit pass for an adult by thelocal transit operator serving the jurisdiction in which the residenceor employer is located. If no monthly pass exists, the amount shallbe the sum of a return fare for a 20-day period. In a jurisdiction inwhich there are multiple transit operators, the amount shall be theaverage of the monthly pass of two or more of the largest operatorsserving the jurisdiction, but no more than four operators. Thisamount shall be calculated by the regional transportation planningagency by June 31 of each year and shall be made available to thepublic on the agency’s Internet Web site. If no transit operatorserves the jurisdiction, the amount shall be $40.

(b) “Full cost of a parking space” means the sum of all of thefollowing:

(1) Annualized land cost. For above-ground structured parkingwithin a larger building, assume a fractional land cost based uponabove-ground volume of the parking facility compared to otheroccuppiable space. For entirely underground parking, assume noland value. To annualize the cost, divide actual or fractional landcost by 10. For leased land, use the annual lease rate.

(1) Annualized land cost. For surface parking or for structuredparking uncovered by occupiable space, the land cost shall be

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equal to the full value of the land area of the parking facility. Forentirely underground parking, the land cost shall be zero. Forabove-ground parking wholly or partially covered by occupiablespace, assume a fractional land cost based upon the above-groundvolume of the parking facility compared to the volume of theparking facility and other occupiable building space combined.To annualize the cost, divide actual or fractional land cost by 10.For leased land, use the annual lease rate.

(2) Annualized construction cost. Include full project costdivided by the useful life of the facility. If actual costs are notavailable, use a per-space cost from a current relevant parkingconstruction cost index, published by the parking, transportation,or construction industries and assume a 40-year useful life.

(3) Annualized operations and maintenance costs. Includelighting, landscape, irrigation, security, insurance, equipment,pavement maintenance, collections, enforcement, and related costs.If actual costs are not available, use current applicable estimatespublished by the parking, transportation, or construction industries.

(c) “Transit intensive area” means central business districts,areas within one-half mile of a major transit stop, as defined insubdivision (b) of Section 21155 of the Public Resources Code,and areas within one-quarter mile of a high-quality transit corridor,as defined in subdivision (b) of Section 21155 of the PublicResources Code.

43001. (a) Notwithstanding any other provision of law, statefunds shall not be used, directly or indirectly, except as providedin subdivision (b), to subsidize the construction or operations ofparking on and after January 1, 2011. For the purposes of thissection, the construction costs of parking include the land, design,environmental review, permitting, project management, mitigation,and actual construction costs. Operating costs include debt service,maintenance, insurance, enforcement, collections, utilities,equipment operation, security, and other ancillary costs necessaryto the operations of the parking facility. The construction oroperation of parking is not subsidized if parking user fees coverconstruction costs within no less than 15 years and operating costson an annual basis.

(b) All of the following are exceptions to subdivision (a):(1) Locations where the cost of collecting payment for parking

would exceed 75 percent of total revenue collected.

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(2) Existing parking facilities at state parks where parkingdemand does not exceed capacity on more than 10 percent of days.

(3) Existing parking facilities at state-owned or leasedemployment facilities that employ 25 or fewer state employees orcontractors where parking demand does not exceed capacity onmore than 10 percent of days during peak hours.

(4) Locations where existing employee collective bargainingagreements forbid payment of parking, until the time that thoseagreements expire.

(5) Locations where federal rules, prior contracts, or priorfunding agreements restrict payment for parking.

(6) Park and ride facilities serving public transit riders andcarpoolers.

(7) Parking spaces reserved for persons with disabilities.43002. (a) On or before January 1, 2012, a city or county

within a region covered by a metropolitan planning organizationshall adopt and implement, or have adopted and implemented,measures from the following menu that achieve a total score of atleast 20 points, based on the points associated with each menuitem:

POINTSMEASUREPARKING REQUIREMENTS AND ZONING

20Eliminate minimum parking requirements citywide or within theunincorporated county.

Reduce average minimum parking requirements for all generaloffice, general retail, general commercial, and similar developmentcitywide or within the unincorporated county to:

25

Less than 3 spaces per 1,000 square feet

10Less than 2 spaces per 1,000 square feetLess than 1 space per 1,000 square feet

5

Reduce minimum parking requirements for residential uses to:1 uncovered space per zero- or one-bedroom unit1.5 uncovered spaces per two-bedroom unit2 uncovered spaces per three-bedroom or larger unit

10Reduce minimum parking requirements for all sizes of residentialunits below 1 uncovered space per unit.

10Eliminate minimum parking requirements for projects in transitintensive areas.

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10

Establish maximum parking restrictions for all general office,general retail, general commercial, and similar development at orbelow the following:3 spaces per 1,000 square feet

152 spaces per 1,000 square feet201 space per 1,000 square feet

10Establish commercial parking maximums of 2 or fewer spaces per1,000 sq. feet citywide or within the unincorporated county.

5Establish commercial parking maximums of 2 or fewer spaces per1,000 sq. feet in transit intensive areas.

5Establish residential parking maximums of 1 or fewer spaces perunit in transit intensive areas.

2

Remove restrictions against residential tandem parking, includingeliminating requirements that parking must be independentlyaccessible to count toward minimum residential parkingrequirement, if any.

2

Remove restrictions against mechanized and mechanical “lift”parking, including counting mechanized spaces toward minimumrequirement, if any.

2Establish a shared parking ordinance and requirements forinterconnection of parking in all commercial areas.

10

Remove or increase 50% of by 50% allowable density limits andfloor area ratios (FAR), allowing infill development on existingparking lots.PARKING AND TRANSPORTATION DEMANDMANAGEMENT

5

Adopt an ordinance to require that any lease for a residentialdwelling unit within a housing development of five or more units,if a parking space or spaces are provided in connection with thelease, include a separate unbundled charge for the parking spaceor spaces that reflects the full cost of the parking space or spacesbut is not less than the number of parking spaces associated witheach unit multiplied by the current cost of a monthly transit passwithin the city or county and grant the lessee the ability to opt outof the parking charge by foregoing use of the parking space orspaces.

5Adopt an ordinance to require, with respect to the initial sale of aseparate interest within a common interest development of five or

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more units, that access to parking be sold separately at a price thatreflects the full cost of the parking space or spaces.

5

Adopt an ordinance to require that any lease for commercial spacein a complex of five or more commercial tenants include a separateunbundled charge for the parking space or spaces that reflects thefull cost of the parking space or spaces but is not less than thenumber of leased parking spaces multiplied by the current cost ofa monthly transit pass within the city or county and grant the lesseethe ability to opt out of the parking charge by foregoing use of theparking space or spaces.

5

Adopt an ordinance to require that any new employment contractunder which the employer provides a parking space within thecity, county, or city and county include a nonreimbursable chargeto the employee that reflects the full cost of the parking space butis not less than the cost of a monthly transit pass within the city,county, or city and county and that the employee may opt out ofby foregoing use of the parking space.

2

Adopt an ordinance to require employers to offer transit passes toall employees, including full-time, part-time, and seasonalemployees, on a pretax basis and certify compliance uponapplication for a new or renewal business license.PARKING MANAGEMENT

10

Adopt an ordinance to set on-street parking meter and publicparking lot and garage rates to achieve an 85% target occupancyrate during hours when adjacent businesses are open or employdemand-responsive rates that vary throughout the day to achievean 85% target occupancy rate.

5

Establish a Parking Benefit District, whereby all or a portion ofnew public parking revenues are directed toward improvementswithin the district where the revenue was raised.

5

Establish a Residential Parking Benefit District, whereby a limitednumber of parkers may pay to park in an otherwise restrictedResidential Parking Permit area, with the net revenue directedtoward improvements within the district where the revenue wasraised.

2

Install parking meters in areas with parking occupancy rates ofgreater than 85% and establish meter rates such that parkingavailability improves to 85% or better.PARKING REVENUE

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6multiplied

Adopt an ordinance to direct some portion of net public parkingrevenues to programs that reduce parking demand, including, but

by the %not limited to, public transit, transportation demand management,of netor bicycle and pedestrian infrastructure improvements and

promotion. revenuedirected6multiplied

Adopt a parking sales tax , a property assessment upon parkingowners, or a use fee upon parkers, with some portion of resulting

by the %net revenue directed at programs that reduce parking demand,of netincluding, but not limited to, public transit, transportation demandrevenuedirected

management, or bicycle and pedestrian infrastructure improvementsand promotion.

(b) Upon request by a city or county, the State Air ResourcesBoard may approve and award points for other alternate measuresto reduce or eliminate subsidies that fail to charge users for thefull cost of a parking space, if points are awarded in a manner thatassigns points to the measures in proportion to their estimatedimpact on vehicle miles traveled, consistent with the weightingfor measures described in subdivision (a).

(c) If a city or county adopts and implements measures thatexceed a total score of 20 points from the menu described insubdivision (a), the city or county shall be eligible to receive carbonreduction credits through the cap-and-trade program administeredby the State Air Resources Board for those measures that exceedthe 20-point threshold.

(d) If a city or county adopts and implements measures toachieve a total score of at least 50 points from the menu describedin subdivision (a), with respect to any application submitted bythe city or county for competitive state loan or grant programsrelated to housing, transportation, or economic development orfunded by a general obligation bond approved by the voters on orafter January 1, 2010, the city, county, or city and county shallreceive bonus points equal to 5 percent of the total available points.

(e) Cities and counties are encouraged to address any parkingspillover from new development through the use of residentialparking permits or other parking management strategies and to

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provide residents who resided in the parking permit zone prior toadoption of the parking permit zone a parking permit for free.

(f) This section shall not apply to a city or county within a regioncovered by a metropolitan planning organization if the metropolitantransportation organization and the jurisdiction have adopted abinding compact in which the jurisdiction commits to implementingparking reforms by January 1, 2013, that achieve a total score ofat least 20 points from the menu described in subdivision (a) andthe jurisdiction fulfills the obligations of the compact.

SEC. 4. Section 2117.5 is added to the Streets and HighwaysCode, to read:

2117.5. Any of the moneys apportioned to cities or countiesfrom the Highway Users Tax Account in the Transportation TaxFund may be expended for the adoption or implementation oftransportation demand management measures, including measuresadopted pursuant to Section 43002 of the Vehicle Code.

SEC. 5. Section 22508 of the Vehicle Code is amended to read:22508. (a) A local authority shall not establish parking meter

zones except by ordinance. An ordinance establishing a parkingmeter zone shall describe the area that would be included withinthe zone.

(b) A local authority shall either fix the rate of fees for parkingmeter zones by ordinance or specify by ordinance a performancetarget and allow the rate of the fees to be set administratively toachieve the performance target.

(c) A local authority may by ordinance cause streets andhighways to be marked with white lines designating parking spacesand require vehicles to park within the parking spaces.

(d) An ordinance adopted by a local authority pursuant to thissection with respect to any state highway shall not become effectiveuntil the proposed ordinance has been submitted to and approvedin writing by the Department of Transportation. The proposedordinance shall be submitted to the department only by action ofthe local legislative body and the proposed ordinance shall besubmitted in complete draft form.

(e) An ordinance adopted pursuant to this section establishinga parking meter zone or fixing rates of fees for that zone shall besubject to local referendum processes in the same manner as if theordinance dealt with a matter of purely local concern.

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(f) A local authority may dedicate any portion of revenuescollected from parking meter zones to benefit parking benefitdistricts or to fund programs that reduce parking demand,including, but not limited to, public transit, transportation demandmanagement, or bicycle and pedestrian infrastructure improvementsand promotion.

SEC. 6. The changes to Section 22508 of the Vehicle Codeenacted by this act are declaratory of existing law.

SEC. 7. No reimbursement is required by this act pursuant toSection 6 of Article XIIIB of the California Constitution for certaincosts that may be incurred by a local agency or school districtbecause, in that regard, this act creates a new crime or infraction,eliminates a crime or infraction, or changes the penalty for a crimeor infraction, within the meaning of Section 17556 of theGovernment Code, or changes the definition of a crime within themeaning of Section 6 of Article XIII B of the CaliforniaConstitution.

However, if the Commission on State Mandates determines thatthis act contains other costs mandated by the state, reimbursementto local agencies and school districts for those costs shall be madepursuant to Part 7 (commencing with Section 17500) of Division4 of Title 2 of the Government Code.

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1

SB 518 (Lowenthal) Reducing Congestion and Greenhouse Gas Emissions through Parking Policy Reform

INTRODUCED FEBRUARY 26, 2009

SUMMARY

This bill seeks to reduce traffic congestion and greenhouse gas emissions by revealing the actual cost of parking and reducing governmental or government-required subsidies for parking.

BACKGROUND “Free” parking has significant social, economic, and environmental costs. First, free parking encourages vehicle trips, thereby increasing traffic congestion, pollution, and greenhouse gas emissions. For example, at employment sites, employer-paid parking increases rates of driving by as much as 22%. Second, excessive governmental parking requirements to ensure free parking greatly expand the built footprint and increase travel distances, thereby increasing per capita vehicle miles traveled and reducing the viability of other transportation modes, such as walking, bicycling, and transit. Third, the high cost of land, construction, and maintenance to provide free parking is passed on to everyone through higher prices. Free parking at stores is paid for by all customers through higher prices for goods. Free employer parking is paid for by lower wages for all workers. Free on-street parking is paid for by the entire community in the form of higher taxes. In each case, these prices are also paid by

those who do not drive. Eliminating subsidies and revealing the actual cost of parking to drivers has enormous potential to reduce traffic congestion and reduce greenhouse gas emissions by reducing vehicle trips. A recent RAND report stated that pricing strategies, such as parking pricing, are the only way to achieve lasting reductions in traffic congestion. And in the short term, changes to parking policy can reduce greenhouse gas emissions more than all other strategies combined. Eliminating parking subsidies can also improve social equity by lowering prices for those who choose not to drive, often lower-income households.

PROPOSAL

SB 518 does the following: • Prohibits the state from subsidizing

parking with certain exceptions. • Prohibits community colleges from

subsidizing parking at their campuses, except for students on financial assistance and for carpools. State regulations already prohibit the University of California and the California State University from subsidizing parking at their campuses.

• Establishes a menu of parking policy reforms with a point score for each reform and requires local governments, by January 1, 2012, to adopt 20 points worth of reforms. Local governments that adopt 50 points worth or reforms receive a 5% scoring bonus for any

Attachment 4

2

competitive loan or grant program funded by a general obligation bond. The reforms on the menu relate to:

Eliminating minimum parking

requirements and/or establishing maximum parking requirements in local zoning ordinances.

Allowing greater development potential on existing parking lots.

Requiring that parking costs be unbundled from rent costs in residential or commercial leases.

Requiring that all new employment contracts charge the full cost of employer-provided parking.

Requiring employers to offer transit passes to employees on a pre-tax basis.

Setting parking meter rates at market rate.

Installing meters in areas with parking shortages.

Establishing parking benefit districts to direct new revenue from meters or meter rate increases to the community from which they come.

Allowing commuters to use surplus spaces in residential permit areas for a price.

Dedicating parking revenues to programs that reduce parking demand, including public transit, transportation demand management, and bicycle and pedestrian infrastructure.

SUPPORT

Natural Resources Defense Council

(sponsor)

STAFF CONTACT

Mark Stivers 916-651-4121 [email protected]

Attachment 4


SENATE BILL No. 728

Introduced by Senator Lowenthal

February 27, 2009

An act to amend Section 43845 of the Health and Safety Code,relating to air pollution.


SB 728, as amended, Lowenthal. Air pollution: parking cash-outprogram.

Existing law requires an employer of 50 persons or more who providesa parking subsidy to employees and who is in an air basin that isdesignated as a nonattainment area in terms of air quality to offer aparking cash-out program, defined as an employer-funded programunder which an employer offers to provide a cash allowance to anemployee equivalent to the parking subsidy that the employer wouldotherwise pay to provide the employee with a parking space.

This bill would authorize the State Air Resources Board to impose acivil penalty for a violation of this requirement, and. The bill wouldalso authorize a city, county, and air pollution control district or airquality management district to adopt additional penalties and compliancemechanisms a penalty or other mechanism to ensure compliance. Thebill would authorize the imposition of a penalty by the state board orthe local agency, but not both.

Vote: majority. Appropriation: no. Fiscal committee: no.


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SECTION 1. Section 43845 of the Health and Safety Code isamended to read:

43845. (a) In any air basin designated as a nonattainment areapursuant to Section 39608, each employer of 50 persons or morewho provides a parking subsidy to employees, shall offer a parkingcash-out program. “Parking cash-out program” means anemployer-funded program under which an employer offers toprovide a cash allowance to an employee equivalent to the parkingsubsidy that the employer would otherwise pay to provide theemployee with a parking space.

(b) A parking cash-out program may include a requirement thatemployee participants certify that they will comply with guidelinesestablished by the employer designed to avoid neighborhoodparking problems, with a provision that employees not complyingwith the guidelines will no longer be eligible for the parkingcash-out program.

(c) As used in this section, the following terms have thefollowing meanings:

(1) “Employee” means an employee of an employer subject tothis section.

(2) “Parking subsidy” means the difference between theout-of-pocket amount paid by an employer on a regular basis inorder to secure the availability of an employee parking space notowned by the employer and the price, if any, charged to anemployee for use of that space.

(d) Subdivision (a) does not apply to any employer who, on orbefore January 1, 1993, has leased employee parking, until theexpiration of that lease or unless the lease permits the employerto reduce, without penalty, the number of parking spaces subjectto the lease.

(e) It is the intent of the Legislature, in enacting this section,that the cash-out requirements apply only to employers who canreduce, without penalty, the number of paid parking spaces theymaintain for the use of their employees and instead provide theiremployees the cash-out option described in this section.

(f) The state board may impose the civil penalty described inSection 43016 for a violation of this section. In addition, a city,county, and air district may adopt additional penalties and

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compliance mechanisms for a violation of this section for anyemployer within that city, county, or air district’s jurisdiction.

(f) (1) The state board may impose the civil penalty describedin Section 43016 for a violation of this section.

(2) (A) A city, county, or air district may also adopt, byordinance or resolution, a penalty or other mechanism to ensurethat an employer within the jurisdiction of that city, county, or airdistrict is in compliance with this section.

(B) If a city, county, or air district establishes a penalty, thegoverning body shall also establish procedures for providing noticeto employers that are in violation of this section and for appealby the employer of any penalty imposed.

(C) If a city, county, or air district establishes a penalty pursuantto this paragraph, a penalty may be imposed on an employerpursuant to paragraph (1) or this paragraph, but not both. If apenalty is imposed on an employer pursuant to both paragraph(1) and this paragraph, only the penalty imposed by the state boardshall apply.

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DATE: May 1, 2009 TO: Transportation Policy Committee Housing and Land Use Committee FROM: Nick Rajkovich, Economic Development Coordinator Peter Skinner, Director of Transportation and Land Use SUBJECT: DIRIDON AREA BUILDING HEIGHTS AND MINETA

INTERNATIONAL AIRPORT

ACTION Recommend the Leadership Group encourage the City of San Jose to maximize development in the Diridon Area without adversely affecting Mineta International Airport’s (SJC) ability to attract and keep air service that meets the needs of Silicon Valley’s residents and business community. BACKGROUND Airport personnel approached Leadership Group staff with concerns about the impact of development plans in the Diridon Station Area on SJC. With planned BART, High Speed Rail service and a potential baseball stadium, there is great interest in transforming the Diridon Area into dense, mixed-use commercial and residential development. However, high-rise construction in the Diridon area over 10 stories has the potential to affect SJC’s ability to offer future long-haul air service or keep existing long-range service at the airport. ANALYSIS While the Leadership Group is supportive of creating a world-class, livable development in the Diridon area, member companies also have an interest in convenient business travel options from SJC. The City of San Jose has also encouraged transforming the Diridon area while modernizing SJC to better serve Silicon Valley. To help frame a discussion about how to strike a balance between these two interests, this brief provides information on:

• Why SJC is concerned about building heights in the Diridon area. • The implications of reduced building heights to development. • The implications to air service if building height limits aren’t observed.

ITEM 7

May 1, 2009 Page 2 of 2 Why SJC is Concerned Building heights are of concern in the Diridon Area because of Federal Aviation Administration (FAA) regulations regarding “One Engine Inoperative” (OEI) takeoff situations. OEI refers to the rare occasion when an aircraft loses power in one engine during takeoff. With less power and less ability to climb, the FAA requires a clear route for aircraft to safely return to the airport. The current OEI route to the north of SJC accounts for existing downtown development, requiring flights to travel directly over the Diridon area. While aircraft only takeoff to the north 10% of the time, airlines must plan for the worst-case scenario and assume any takeoff will be in the northbound direction. Regional flights on smaller aircraft are not as affected by this rule as long-haul destinations served by larger airplanes. This is because large aircraft cannot climb as quickly as smaller planes, such as those operated by Southwest Airlines, resulting in a need for the height limit. Implications for Diridon Area Development As mentioned above, the current OEI routes account for existing downtown buildings and those in the Diridon area. Preserving established OEI routes would require height limits of approximately 10 stories on new high-rise development in the Diridon Area. Fortunately, the planning effort for the Diridon area does not currently envision building heights exceeding this limit. Therefore, supporting a 10-story height limit would not conflict with the Leadership Group’s desire to intensify development in the Diridon area. Implications for Air Service to Silicon Valley Since 2000, San Jose also has spent well over $1.5 billion to build a world-class airport for Silicon Valley. These improvements include lengthening and upgrading runways, building a new international arrivals building, and undertaking the current modernization program to build and upgrade terminals, parking garages, and roadways. This investment has created the potential to lure new business travel and resulting non-stop flights to the East Coast, Asia and Europe. However, these flights require larger aircraft that, as mentioned earlier, could not operate from SJC if buildings are over 10 stories high. Furthermore, existing long-haul flights operated by commercial and freight carriers would no longer be able to fly from SJC. Examples of carriers currently operating larger planes include UPS, FedEx and Hawaiian Airlines. CONCLUSION This issue can be resolved to the satisfaction of all stakeholders by ensuring the San Jose City Council as well as airport and planning staff work together and understand the relationship between the need intensify development in the Diridon area and the need to ensure the success of the investment San Jose has made in SJC. Considering the Diridon planning effort does not foresee buildings over 10 stories, requesting the City of San Jose maximize development without adversely impacting the airport is consistent with existing positions of the Leadership Group.

DATE: May 11th, 2009 TO: Land Use and Housing Committee & Transportation Policy Committee FROM: Nick Rajkovich, Economic Development Coordinator RE: Proposed A’s stadium in San Jose

Action: Recommend to Working Council that the Leadership Group take a position on the proposed Major League Baseball Stadium south of the Diridon Station.

224 Airport Parkway, Suite 620 San Jose, California 95110

(408)501-7864 Fax (408)501-7861 www.svlg.net

CARL GUARDINO

President & CEO Board Officers:

AART DE GEUS, Chair Synopsys

TOM WERNER, Vice Chair SunPower

MICHAEL SPLINTER, Past Chair

Background: After negotiations with Fremont resulted in a dead end, the City of San Jose revived talks about a baseball stadium in San Jose. Initially, in 2007, the City completed an EIR for the development of an approximately 1.5 million square‐foot, 45,000‐seat, open‐air major league baseball stadium, a parking structure, and a future commercial development site on 23.1± acres in the City of San Jose. The stadium would have a maximum height of 165 feet, with scoreboards about 200 feet and lights roughly 235 feet above finished grade. As part of the proposed project, a 420,000± square‐foot, five‐story parking structure with around 1,200 parking spaces and ground floor commercial uses is proposed south of the ballpark, across Park Avenue. Montgomery Street between W. San Fernando and Park Avenue would be abandoned (because the stadium will be built over it) and S. Autumn Street would be realigned to the east to accommodate the proposed project.

Applied Materials, Inc. WILLIAM T. COLEMAN III, Past Chair

Cassatt Corporation

ROBERT SHOFFNER, Secretary/Treasurer Citibank

Board Members:

JOHN ADAMS Wells Fargo Bank

SHELLYE ARCHAMBEAU MetricStream, Inc. New talks are centered around a scaled back stadium project of 32,000 seats, a 30%

decrease in capacity from what was approved in the 2007 EIR. It is worth noting that the City of San Jose is on record as having chosen this site for this use for a multitude of reasons. Downtown San José lies less than one mile to the east. Downtown eateries, offices, residential projects, entertainment options, and the San José State University campus, combine with the HP Pavilion and commercial uses in the Alameda District to enhance the area’s economic and social vitality. The proposed sports stadium would add to and benefit from this activity, further supporting an active and walkable Greater Downtown Area. The project site also enjoys strong freeway access from Highway 87 and Interstate 280, as well as transit access at the nearby Diridon station, which is served by numerous bus, light rail transit (LRT), Caltrain and the future BART extension and HSR. Finally, the site is within a Redevelopment Project Area, allowing the SJRDA to invest tax increment funds in the project and the surrounding area as necessary to promote local economic development.

RICHARD BAIRD IBM Corporation

MARY ANN BARNES Kaiser Permanente

NED BARNHOLT KLA-Tencor

GEORGE BLUMENTHAL University of California, Santa Cruz

TOM BOTTORFF Pacific Gas & Electric

RAMI BRANITZKY SAP Labs North America

TORY BRUNO Lockheed Martin Space Systems Company

DAVID DEWALT McAfee, Inc.

RAQUEL GONZALEZ Bank of America

TIM GUERTIN Varian Medical Systems

JON HOAK Hewlett-Packard Company

MIKE KLAYKO Brocade Communications Systems

PAUL LOCATELLI, S.J. Santa Clara University

TARKAN MANER Wyse Technology

LEN PERHAM

City of San Jose’s Vision for the Diridon Area: Several City of San José planning documents address the project site and the surrounding neighborhood. These include the San José General Plan 2020, the Midtown Specific Plan (1992), the Greater Downtown Strategy for Development: Strategy 2000, the Burbank/Del Monte Neighborhood Improvement Plan (2002), and the Diridon/Arena Strategic Development Plan (2003). These documents generally call for the long‐term development of the area around the project site as an extension of Downtown, and look to foster a pedestrian‐oriented community centered around local transit nodes, and consisting of higher‐density residential and mixed‐use projects. Several multifamily projects in the area already support these goals, and a new stadium may further contribute to the viability of additional mixed‐use projects in the area.

Monolithic Systems KIM POLESE

SpikeSource, Inc. WILLIAM E. RHODES III

BD Biosciences ABHI TALWALKAR

LSI Logic MAC TULLY

San Jose Mercury News DAN WARMENHOVEN

NetApp, Inc. KENNETH WILCOX

Land Use: The ballpark facility may also be used for events other than baseball approximately 15 to 20 times a year. Furthermore, according to the City of San Jose Redevelopment Agency, there are 18,500 parking spaces available within a ¾ mile radius of the site. According to the EIR, “Implementation of the proposed project

SVB Financial Group Working Council Chair

VICTOR ARRAÑAGA, JR. Applied Materials

Established in 1978 by DAVID PACKARD

ITEM 8

would not result in any significant population, employment, or housing impacts” (EIR §VB). The project site is separated from residential uses on the west by the railroad tracks and on the east by Los Gatos Creek. The proposed stadium would be of a similar scale as the HP Pavilion and would connect with existing uses north of the site, specifically the HP Pavilion, which would reinforce the concept of a sports and entertainment district at the western edge of the Downtown. North of the site, across W. San Fernando Street land uses are primarily entertainment oriented, including the HP Pavilion and associated surface parking lots. Due to the proximity of the aircraft flight paths for the Norman Y. Mineta San Jose International Airport, development on the project site is subject to height restrictions pursuant to Federal Aviation Regulations, Part 77. South of the site land uses primarily include active rail lines and light to heavy industry. Townhomes and multi‐family condominiums are currently under construction south of the project site located across W. San Carlos Street and would be subject to increased pedestrian and vehicular activity and increased noise levels due to operation of the proposed project. West of the site, across the railroad tracks, land uses are primarily medium density residential and commercial. East of the site is Los Gatos Creek, where a multi‐use trail is proposed as part of another project planned which will implement the Los Gatos Creek Trail Master Plan. The proposed project would increase pedestrian and vehicular activity in the area, thereby increasing potential disturbances to nearby Delmas Park residences, east of Los Gatos Creek (for example, along Gifford Avenue and Florence Way). These residents are already subject to major entertainment related activity in the area, due to events at the HP Pavilion. In addition to increased activity in the area, potential noise disturbances could occur due to stadium events. However, this is an urban neighborhood located on the edge of the Greater Downtown and surrounded by some of the highest density development in the City. Transportation: The stadium site is adjacent to the Diridon train station, which is served by numerous bus, Light Rail Transit, Caltrain, and commuter rail routes. The Diridon station is served by six bus routes and the DASH shuttle. In addition, three more bus routes are only two blocks away on The Alameda. The Diridon station is also a future stop both for th eBART and HSR lines. Economic Development: A new ballpark would significantly alter the proposed site’s character by replacing aging industrial properties. Moreover, if well‐designed, the San José stadium would anchor the neighborhood, linking it more visibly to HP Pavilion and Downtown and encouraging surrounding new development. The case studies of San Francisco’s AT&T Park and other urban sports venues, particularly Baltimore’s Camden Yards, also indicate that while a stadium would increase traffic and pedestrian activity in a neighborhood, the negative impacts can be mitigated by pro‐active parking and traffic management, a transit‐oriented design, and a positive working relationship between the stadium operator, the City, and local residents. In addition to being a catalyst for residential housing growth, the proposed stadium would employ a maximum of 1,560 full‐ and part‐time employees, including the following: 495 day of game, 715 concessionaires; 80 players, coaches and trainers; 135 media; and 135 other types of employees. Case Studies San Francisco: Among the more successful urban sports stadiums, AT&T Park in San Francisco weaves the stadium into the urban fabric, surrounding the development with new residential and commercial projects. AT&T Park has spurred the development of 3,000 homes to date in a formerly blighted area. There are 4,000 additional homes planned. To understand how local home prices might be affected by the presence of a contemporary urban sports stadium, (Bay Area Economics) BAE compared residential real estate trends in South Beach, the neighborhood around San Francisco’s AT&T Park, to sale prices and rents throughout San Francisco. AT&T Park, built in 2000, and the proposed San José stadium share a number of key elements, making AT&T Park an appropriate model for this study. Both venues seek to complement and enhance surrounding uses through sensitive design, they anchor the revitalization of a neighborhood near downtown, and they aim to foster a pedestrian‐oriented and transit‐accessible environment. Findings suggest that AT&T Park contributes to higher rents in South Beach compared to the rest of the city. However, appreciation rates in both South Beach and the city as a whole generally remained comparable following construction of

the ballpark. The data show that rents in South Beach have consistently outperformed rents throughout the city since 2002. Baltimore: Built into the fabric of Baltimore’s west downtown and incorporating a historic warehouse, the Camden Yards baseball stadium has received rave reviews for its architectural beauty and central location since it opened in 1992. As the first stadium in recent history explicitly designed to connect with and benefit the surrounding neighborhood, the perceived success of Camden Yards has changed the way stadiums are built in the US by showing that it is possible to curtail stadium impacts such as parking, traffic, trash and noise. The stadium has proved itself a good neighbor and gained trust from local residents. However, initially lacking a comprehensive neighborhood vision, the ballpark suffered a slow start in spurring economic development in west downtown. Later stadiums, such as Jacob’s Field and Coors Field, have used the Camden Yards model to greater economic advantage. To address neighborhood concerns, parking now requires a resident permit and non‐residents’ cars are towed on game days. In Camden Yards’ first year of operation, mounted police deployed on game days to maintain order and direct traffic. Extra street sweeping and garbage pickup were added as well. New construction is restricted by historic preservation regulations, helping to protect the historic character of both neighborhoods. Denver: Revitalization efforts started several years before the ballpark’s completion with Lower Downtown (LoDo) designation as a historic district in 1988. During this time, the neighborhood saw the historic Oxford Hotel restored and the development of new retail and loft housing. The announcement in 1991 that Coors Field would be located in LoDo gave the neighborhood another boost. Sales tax revenue in LoDo increased by 22 percent a year from 1990 to 1995, and the number of restaurants increased 140 percent between 1993 and 1996. However, the pace of change increased dramatically after the stadium opened. In 1994, LoDo contained 270 residential units. By 2000 that number had jumped to 1,374 with 410 more planned or under construction. While Coors Field cannot take all the credit for these recent neighborhood improvements, it does appear that the stadium has been an integral part of LoDo’s turnaround. Adverse Impacts: the site will require substantial acquisition, demolition, and relocation efforts by the SJRDA. The Draft EIR states that the proposed project, including the parking structure, would require the removal of 17 buildings totaling 327,045 square feet, one of which is a historic resource. Relocation or reconfiguration of a PG&E substation located adjacent to the railroad tracks, northwest of the project site, would also be necessary. As another consideration, residential projects in the area contribute to local vitality, but will require parking, noise, and traffic mitigations if stadium construction moves forward. An existing PG&E substation located adjacent to the railroad tracks northwest on the project site will be modified or may be relocated as part of the proposed project. Two options are being considered at this time: (1) reconfiguration of the existing substation to accommodate the relocation of underground electrical distribution lines or (2) relocation of the substation south to the existing Fire Training Center site. The proposed project would have, but is not limited to, the following cumulatively considerable impacts: • Increase in traffic on SR‐87 and I‐280; • Project construction activities and operation would exacerbate non‐attainment of air quality standards within the subregion and air basin; • The increase in noise levels from project‐related traffic; • The loss of a structure which appears to be both a candidate City Landmark and eligible for the California Register; • Increase in light and glare from nighttime operation of the stadium. These effects constitute significant cumulative impacts. In all other environmental topical areas, the project’s contribution would be reduced or eliminated by project mitigation measures to the point that the project would not contribute considerably to any other significant cumulative impacts.

DATE: April 28, 2009 TO: Housing and Land Use Committee 224 Airport Parkway, Suite 620

San Jose, California 95110 (408)501-7864 Fax (408)501-7861

www.svlg.net

CARL GUARDINO President & CEO

Board Officers: AART DE GEUS

Chair

FROM: Courtney Kettmann, Housing Coordinator RE: CA Redevelopment Coalition – Main Street Recovery Plan ACTION: Recommend that the Leadership Group joins the Redevelopment Coalition to protect redevelopment funds from the state. BACKGROUND Synopsys

TOM WERNER In February 2009, legislators had the difficult task of passing a budget to solve California’s $41.8 billion budget gap. Legislators solved the budget shortfall without borrowing from local governments or taking funds from redevelopment agencies. The Main Street Recovery Plan protects redevelopment agencies from unconstitutional takings similar to the $350 million that was adopted to close the current 2008‐2009 deficit. That taking cut 31,058 jobs, $2.34 billion in lost income of which $1.28 billion in the construction sector.

Vice Chair SunPower

MICHAEL SPLINTER Immediate Past Chair Applied Materials, Inc.

WILLIAM T. COLEMAN III Past Chair

Cassatt Corporation

ROBERT SHOFFNER Secretary/Treasurer

Citibank

Board Members: JOHN ADAMS Currently, Redevelopment Agencies are the second largest funder of affordable homes in California after the federal government. A take from the Redevelopment Agency would threaten the rehabilitation and construction of affordable homes. This take would only enhance the troubling economic situation for low and moderate‐ income Californians.

Wells Fargo Bank SHELLYE ARCHAMBEAU

MetricStream, Inc. RICHARD BAIRD

IBM Corporation MARY ANN BARNES

Kaiser Permanente NED BARNHOLT

KLA-Tencor GEORGE BLUMENTHAL

University of California, Santa Cruz TOM BOTTORFF

Pacific Gas & Electric DAVID DEWALT

McAfee, Inc. RAQUEL GONZALEZ

Bank of America JON HOAK

Hewlett-Packard Company RICHARD LEVY

Varian Medical Systems PAUL LOCATELLI, S.J.

Santa Clara University DOUG MERRITT

SAP Labs LEN PERHAM

Redevelopment is also a critical tool to the environmental community. Redevelopment Agencies tend to further State priorities under AB 32 through infill development, transit oriented development, and green building. Also many projects funded through State bond proceeds Proposition 1C (housing) rely on matching redevelopment funding. Those projects would be greatly affected by the loss of redevelopment revenues. Redevelopment significantly impacts long‐term recovery. Redevelopment generates 310,000 good‐paying jobs, $32 billion in total economic activity and $1.6 billion in state and local taxes annually.

Monolithic Systems KIM POLESE

SpikeSource, Inc. WILLIAM E. RHODES III

BD Biosciences ABHI TALWALKAR

LSI Logic DAN WARMENHOVEN

Network Appliance KENNETH WILCOX

ANALYSIS Redevelopment Agencies are the second largest funder of affordable housing. Specific to our area, the San Jose Redevelopment Agency has built more than 11,000 affordable units since 1976. Redevelopment agencies have historically

SVB Financial Group

Working Council Chair VICTOR ARRAÑAGA, JR.

Applied Materials

Established in 1978 by DAVID PACKARD

ITEM 9

promoted infill and transit‐oriented development and with the lack of funding projects like these may not be constructed.

ACTION Staff recommends the Leadership Group join the coalition and asks that redevelopment funds continue to be used for redevelopment projects and not be used to backfill the state’s general fund.

Land Use and Housing Committee Minutes 4/13/09 Attendees: David Jackson, Kindle Barkus, Joe Maleti, Ian Hill, Ed Axelsen, Guy Steffens, Paul Shepherd Staff: Shiloh Ballard, Anngiely Salvacion, Bena Chang, Nick Rajkovich Minutes: Adopted Morgan Hill Measure A Guests: Dennis Kennedy, Chair of the Yes on Measure A Campaign and Jorge Briones, Morgan Hill Downtown Association Dennis and Jorge gave a quick overview of the Measure. (See related briefing materials.) Essentially, this measure would direct more of the planned residential growth towards Morgan Hill’s downtown core, instead of on the outskirts of town. Intended to help boost Morgan Hill’s downtown, the same measure was attempted during the last election and failed by only 10-15 votes. Questions/Discussion

- Is there any organized opposition: No, not really. - Is there an inclusionary zoning ordinance in Morgan Hill: Yes - Why didn’t the measure pass last time? They believe there was a lot of misunderstanding

out there of what the measure actually was. As well, there was no organized campaign for it. They have learned from that mistake and are running a campaign this time around.

- Is the measure identical to the previous one? Essentially yes except that they strengthened the language around environmental sustainability.

- If the Leadership Group supports this measure, how can we be helpful? They would appreciate being able to use our name and of course would also appreciate campaign contributions.

Motion to support made by Paul Shepherd and seconded by David Jackson. Motion passed unanimously. A’s Stadium Guest: Nick Rajkovich, Silicon Valley Leadership Group Nick gave an overview of a survey the Leadership Group took of its members. Generally, LG member companies were favorable towards bring an A’s stadium to San Jose and specifically said that they would be willing to support the ballpark through sponsorships etc. He touched on some of the land use issues associated with the parcel, which is located near the Diridon Station. One of the key issues that will need to be dealt with is the PG&E substation.

ITEM 10

Discussion/Questions - What ultimately is the best use for the site, especially given its proximity to the Diridon

Station. Is there something better, like a corporate employer or something like that? - How much $ does a stadium bring in to a community? - How much would the stadium cost? $350 million. - What happens to the San Jose Giants? They would go. - What happens to the San Jose Giants stadium? It’s old and could go too? - What are the negatives of the site? Residential interface issues will be raised. For an

outdoor stadium, noise and light issues will be big. - How of other stadiums impacted existing residential areas? - Is this in a redevelopment area?

The Committee will be asked at a future meeting to recommend a position on the stadium proposal and would like information brought back on these different issues/questions. SB500 (Steinberg) Guests: Judy Nevis, Panorea Avdis and Chris Westlake Staff reminded the Committee that SB500, one of our priorities, is winding its way through the process. Although it will likely be a two year bill, the battle for where the money will go will likely be a bit messy. Staff’s intent with this agenda item is to lay the groundwork so that the Committee can appropriately respond to the various requests for support it will likely receive with regard to the spending sides. For that reason, Staff asked HCD to review what they view as the best and most successful programs. HCD’s comments were as follows. In terms of the listening tour, HCD hear consensus around funneling the money to the following items.

- Multifamily Housing Program is a huge priority. - Ownership Programs like CalHome and BEGIN were also highlighted. HCD does have

some question around whether it might be useful to serve higher income levels through an ownership program, specifically, incomes above 120%.

- “Self-directed funds” is the pot of money they anticipate that will go directly to local governments with few strings. They heard around the State a huge emphasis on this and understand the reasoning/rationale.

In terms of the performance of these programs, they are all oversubscribed, and as a result, HCD sees them all as necessary and effective.

- MFH: This program is very competitive with three applications for every 1 allocation. The loans are very good, 3% simple interest deferred for 55 years. All developments that win this money score perfectly on the program.

- TOD and Infill money from Proposition 1C: This program is oversubscribed 6:1. Because it is still new, HCD doesn’t have enough of a history with the program to evaluate its success.

With this new source of funding, the State hopes to generate $2 billion/year that will construct 30,000 new homes.

Discussion/Questions

- With the decline in values, is there still a need for a loan product in the 120-200% range? Long term, they think so.

- Secondary mortgage idea: Joe expressed some of his concerns around the notion of generating fees from loan guarantees and securitization. The response from HCD was that these issues will need to be worked through and they welcome the help to do so.

North San Pedro Development Proposal and Prop 1C Grant Request Guests: Bob Staedler, San Jose Redevelopment Agency, John Ennis, BDE Architecture, Martin Menne, Barry Swenson Builders and Phil Curry, Intracorp. Staff gave a brief overview of the reason we are looking at this proposal. The SJ Redevelopment Agency approached the Leadership Group for support of a Proposition 1C funding request from the Infill and TOD grant fund. The guests gave a rundown of the proposal:

- 5.72 acres near St. James and Market that will be comprised of 135 special needs homes by First Community Housing, 3 residential towers about 150 feet high, 610 homes total (not including the third tower. The third tower was not included in the funding application.)

- They have requested $37.5 million in their application. They scored 242.5 points out of 250 on the Infill side and 312 of 380 on the TOD side. Mid-May they should know how HCD scored them and in June the Committee meets to decide.

- Redevelopment has been working on putting this site together for redevelopment for many years and has succeeded in pulling together 33 separate parcels. They have spent $20 million on land acquisition.

Discussion/Questions

- Is the density sufficient? It does seem pretty dense but it could probably have included more towers.

- It meets the Committee’s criteria for endorsing developments - How does Legacy, the residential neighbors, feel about it? - How do they feel about a stadium potentially going in across the freeway from them?

They think that would be nothing but positive for their deal and for downtown in general. They spoke very positively about the benefits of ballparks in other downtowns.

Motion to support after checking to make sure there aren’t any red flags in terms of neighboring opposition or City concerns. Motion made by Joe and seconded by Guy. Motion passed.

may 11, 2009 silicon valley leadership …svlg.org/docs/archive/tpc-luc agenda packet_5-09.pdf ·...

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