AB 285 Report: Five Initial Observations

There are probably 285 things we could say about the AB 285 report. Some positive, others critical.  But that would be a really boring read, so here are our initial five thoughts:

Quick Background: What Is an AB 285 Report?

The AB 285 Report (technically, the Transporation Assessment Report) is a review of the CTP 2050, the state’s transportation plan. Published by the Strategic Growth Council, the report also looks at the relationship between the state and regional transportation plans and other state goals. The research was produced by the Institute for Transportation Studies, which is affiliated with the UC System.  The team at ITS produced five research papers and a summary with findings and recommendations. SGC staff then produced a cover memo with their own findings and recommendations. This article is focused on the 285 Report (by ITS) and the SGC cover memo.

Now, back to our five things . . .

1.  AB 285 Fails to Adequately Address the State’s Reliance on Pricing

The California Transportation Plan 2050 (CTP 2050) is built upon very aggressive—some might even say unlikely—assumptions. (See CTP 2050, p. 86-87). Perhaps the most notable of these is the assumption that vehicle operating costs will increase by 50 percent. Vehicle operating cost is one of the most significant determinants in how much people choose to drive (i.e., the more someone pays for gas, the less miles they are likely to drive).

So just what does a 50 percent vehicle operating cost increase mean?  It equates to raising the gas tax by $2.25 per gallon. (See footnote [1] for our calculation).  That would be over $3.oo per gallon in the year 2035.

You might wonder what an assumption like that doing in a state plan. But it serves a purpose. It’s there to demonstrate what it would take to actually meet the state’s 2050 climate goal.  It is the starting point to analyze the gap between where we are and where we want to be. Given this purpose, we are not critical of its inclusion in the CTP 2050.

But we are very critical of the failure of the AB 285 Report to call out how pricing is used in the CTP 2050 more directly.

We understand that things like a potential gas tax increase are not politically popular—particularly now. But the AB 285 Report’s omission of this issue within its recommendations sets California on the wrong track. Achieving the 2050 climate goal starts with an accurate description of scope. The 285 Report should have been enlarged to begin the discussion of what new policies will be needed to meet the baseline scenario upon which the CTP’s vision is pegged. Otherwise, the California is not addressing the problem in a way that will meet its climate objectives

2.  A Fiscally Constrained Analysis of Proposed State Policies and Assumptions is a Prerequisite for Meaningful Comparison to Regional Plans

Here we concur with AB 285 Report. Wholeheartedly. The CTP 2050 should include a fiscal and feasibility analysis to identify the gap between what existing resources can achieve and what is needed. As we noted in The CTP 2050 is Really a Statewide APS, regional transportation plans are “fiscally constrained,” meaning that projects and policies must be supported by reasonably assumable revenues and other assumptions.  The CTP 2050, on the other hand, is “aspirational” in so far there are no limitations on how realistic the assumptions or forecasted outcomes should be.

A fiscal analysis is a necessary pre-requisite for any meaningful discussion about the interrelationship between regional plans and state plans.

The AB 285 Report stated that:

The CTP’s impact would be improved if, in addition to an aspirational, unconstrained vision, it included an alternative that showed what it could expect to accomplish with current authority and funding. Comparing a “constrained” scenario to the unconstrained vision would allow decision-makers to gauge which changes might be desirable. In addition, describing who was expected to take action, when, and with which resources would allow plan efficacy to be tracked and evaluated.

We appreciate that the SGC also recommended the inclusion of a fiscal constraint analysis in the CTP 2050 in its cover memo. Simply put, a fiscal analysis is a necessary pre-requisite for any meaningful discussion about the interrelationship between regional plans and state plans.

3.  Align State Goals Before Determining Whether Projects in the Pipeline are Consistent. 

We concur with the AB 285 Report’s recommendation that state goals should align with one another (at page 30). The AB 285 Report notes that state agencies are directed to provide “a high-quality, resilient, multimodal transportation system that provides mobility and accessibility for all users and to see that the system is safe and secure, meets GHG emission reduction targets, eliminates burdens for disadvantaged groups, supports economic development, protects the environment, and enhances public health and vibrant communities.”  We would have also added “in a way that supports state goals in providing sufficient housing for all Californians.”

These goals vary and can even be in conflict with one another. There is no guidance about what to do in these situations.  This lack of clarity leads to uneven application of the goals between communities or even on a project-by-project basis.  Thus, the AB 285 Report recommendation that the state better align state goals—and perhaps even developing a conflict resolution process—makes a lot of sense.

That said, we take exception to the recommendation to engage in an immediate review of the projects in the project development pipeline (SGC memo, Recommendation 3). We recommend that a state alignment of goals should occur prior to such an assessment (i.e., how can you be sure a project is aligned with state goals, which according to the 285 Report findings, are not aligned or prioritized?)  Accordingly, assuring alignment of such a process  state goals is a logical first step.

4.  Both Local and State(!) Policies Affect Regional Performance

The AB 285 Report correctly notes that there are a lot of policy decisions made by local, state, and federal governments that affect the ability of MPOs to achieve greenhouse gas reduction targets. Unfortunately, there is a disconnect between the contents of the AB 285 Report and how SGC framed the issue in its cover memo.

According to SGC, the issue would be addressed by assuring MPOs have “appropriate” tools to effectively accomplish what is expected of them,” such as “reviewing local land use and transportation actions.” But that is not entirely what the AB 285 Report actually said.  Compare Finding 7 in the summary section of the AB 285 Report:

MPO plans make assumptions about large-scale policy and behavioral developments that depend on federal, state, private sector, and individual action, such as the rate of telecommuting, the implementation of road pricing, and the speed of uptake of electric vehicles. MPOs also face roadblocks in implementing their plans because a substantial portion of their funds are already committed to projects that have been planned for many years, to maintenance of existing facilities, and to voter- approved transportation spending measures. In addition, local governments’ willingness to conform to regional plans’ land use proposals has been spotty.

While the MPOs can use incentives as a way to achieve their goals and can require proposed transportation projects and project packages to meet rigorous cost-benefit and social equity analysis and ranking, most of them have concluded that stiffer GHG reduction targets for future years (for example, 2035) would be infeasible absent state policies for road and parking pricing, more funds dedicated to multimodal transport, and more “direct support” for local infill development.

(emphasis added). Thus, it is not just local government decisions. The effect of federal and state policies are also factors that must be considered. While we believe that SGC staff was sincere in its efforts to summarize the AB 285 Report, it’s hard not to infer a degree of hesitancy or bias toward acknowledging how state policies affect regional climate strategies. As we describe in A Recipe for VMT Reduction, the accountability and partnership must be mutual between state, regional, and local governments.

5.  Reforming SB 375 is Not the Most Urgent Need

There remain a significant amount of emission reductions that have not yet been addressed in state plans. See SB 375’s Emission Gap Explained.  The SB 375 targets themselves only achieve approximately 80 percent of the reductions called for from “SB 375-like policies” in the Scoping Plan. The rest are supposed to come from “additional state strategies” for which the state has yet to develop a plan.

Perhaps California should develop a plan to address these emissions before tweaking the plans that are already in place.

We get it, the SB 375 plans are tangible and easy for the public and policy makers to focus on.  There are maps and transit routes and a vision. There is travel model data and even a CEQA analysis.  All of this makes the regional plans more tangible–which in turn makes it easier to envision alternative visions and “tweaks” to the process.

We need to start giving more attention to the issues that defy tangible answers.

But as a state need to start giving more attention to the issues that defy tangible answers. How are we going to get additional reductions from state policy on the current transportation system? Should we introduce pricing? And how should we do it if we do? How can we make low VMT infill development “pencil out” in a way that makes it preferrable to greenfield development? How do we maintain our current road system for electric vehicles without sufficient gas tax revenues? How will would the state manage system differently if streets and roads were considered a limited public asset? And how do we do it fairly in a way that is equitable?

These are “sticky” problems.  Although their solutions will affect SB 375, they cannot be implemented by regional action alone. MPOs cannot invent a new pricing strategy or implement a new infill funding program without state action.  That is the discussion the AB 285 Report should be elevating. To be sure, SB 375 reform is an important policy discussion, but it is not the one that is most needed to meet our 2050 climate goals.

The AB 285 report was an opportunity to focus the next round of state on the policy discussions that require dramatic policy change at the state level. And on that measure it falls short.

Conclusion

We want to thank the SGC staff for reaching out to representatives of regional agencies over the past year and really listening to the input they received.  We understand that SGC receives a lot of input from a lot of different perspectives, and balancing those viewpoints are difficult.  Our comments here are consistent with those conversations. We tried to point out the positive along with what we think needs to be improved–though admittedly we spent more time on the improvements.

In the coming weeks, we will continue our analysis and share a more full set of comments. We are committed to developing a better partnership with state agencies in building a high-quality, resilient, multimodal transportation system that provides mobility and accessibility for all users and to see that the system is safe and secure, meets GHG emission reduction targets, eliminates burdens for disadvantaged groups, supports economic development, protects the environment, enhances public health and vibrant communities, and provides sufficient housing for all Californians.”

Now we can start working on the other 280 comments.

 


[1] Our math: A typical vehicle operating cost is close to 18 cents a mile. Thus, a 50% increase equals 27 cents per mile, or a 9 cent increase. Conservatively assuming average fuel efficiency of 25 mpg, a gas tax (or fee structure) that equals 9 cents per mile achieves the 50 percent increase.  Accordingly, 9 cents/mile x 25 mpg = $2.25 per gallon.  Our fuel efficiency is low: the higher the efficiency the higher the tax or fee needed to achieve the 50 percent increase. These are reflecting today’s prices. Based on MPO estimates for 2035, the amount of the gas tax would rise to over $3 per gallon.



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