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7 Steps to Greater Self-Sufficiency

7 Steps to Greater Self-Sufficiency . Steve Heminger, Executive Director Metropolitan Transportation Commission Atlanta LINK Program May 1, 2003. It’s our money, and we’re free to spend it any way we please… If you have money you spend it, and win. — Rose Kennedy. 1. Devolution.

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7 Steps to Greater Self-Sufficiency

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  1. 7 Steps to Greater Self-Sufficiency Steve Heminger, Executive Director Metropolitan Transportation Commission Atlanta LINK Program May 1, 2003

  2. It’s our money, and we’re free to spend it any way we please…If you have money you spend it, and win. — Rose Kennedy

  3. 1. Devolution

  4. 1923 — Local Road Share • First state gas tax of 2 cents per gallon enacted, with 1 cent for state highway account and 1 cent for aid to counties; establishes 50/50% precedent. 1927 — Regional Split • North/south split enacted, whereby 49% of state highway account capital funds must be spent in southern California and 51% in northern California (current split stands at 60% south, 40% north). 1961 — County Minimums • County minimum formula enacted: at least 70% of state highway account capital funds — both federal and state gas taxes — must be spent in each county based on a population/road mile formula.

  5. 1992 — Suballocation on Steroids • State legislature passes ISTEA implementing bill that not only codifies the federal suballocation of STP funds, but takes extra step of suballocating CMAQ funds to MPO’s in air quality non-attainment and maintenance areas. 1997 — Amicable Divorce • State legislature passes Senate Bill 45 which guarantees that MPO’s have project selection authority over 75% of state highway account spending; the remaining 25% of funds are programmed by CTC. Regional role is to match transportation funds with local land use decisions. State role is to facilitate travel “to and through” metropolitan areas.

  6. TEA 21 STP and CMAQ ProgramBay Area Total = $754 million

  7. TEA 21 STIP ProgrammingBay Area Total = $1.3* billion * Includes state transportation revenues combined with TEA 21

  8. 2. United Front

  9. Resolution No. 1876

  10. Resolution No. 3434Map of Projects

  11. Resolution No. 3434Service Characteristics • 140 new route miles of rail • 600 new route miles of express bus • 58% average increase in service levels for existing corridors • 38.6 million new riders per year (estimated for fully funded projects) • Average cost effectiveness of $20.35 per new rider (estimated for fully funded projects)

  12. 3. Self Help

  13. Voting Results on Transportation Funding Ballot Measures: Bay Area vs. State

  14. Sales taxes outstrip the STIP • In each of the five Bay Area counties with a special transportation sales tax in place, the proceeds from this levy exceed the county’s share of funds from the STIP.

  15. Projected Bay Area Transportation Revenues 2002 – 2026

  16. 4. Swaps (part I)

  17. Regional Measure 1 Projects – $1.6 Billion Bay Area Toll Authority

  18. Three New Bridges Carquinez Bridge Replacement San Mateo-Hayward Widening New Benicia-Martinez Bridge

  19. The Original Plan of Finance • BATA developed a Plan of Finance with a prudent mix of fixed and variable rate debt. • While existing assets act as a natural hedge against variable rate debt, BATA has a limited amount of variable rate capacity given its limited ability to increase revenues. Debt mix: 67% Fixed Rate 33% Variable Rate 4.18% 5.50%

  20. The Current Plan of Finance • After the execution of the 2002 swap, BATA has approximately $200 million in additional fixed rate debt and $300 million in additional variable rate debt to implement. • The 2002 swap successfully locked in a fixed rate at 139 bp (1.39%) below the current assumed fixed rate in the Plan of Finance. 4.86% 3.60% (To Be Financed) 4.11%(1) 5.50% Debt mix: 67% Fixed Rate 33% Variable Rate (To Be Financed) (1) Excludes annual liquidity and remarketing fees.

  21. Savings Realized Original Plan of Finance 4.18% 3.60% 5.50% 4.48% Average Borrowing Cost: 4.19% Average Borrowing Cost: 5.07% Adds $200 million in additional project capacity • BATA has limited variable rate capacity, and the 2002 and 2003 swaps were designed to lock in interest rates at levels below the current market as well as the assumptions for the fixed rate component of the Plan of Finance. Current Plan of Finance

  22. 5. Swaps (part II)

  23. Taking Advantage of Diverse Portfolio Santa Clara/MTC Swap • MTC assisted Santa Clara Sales Tax Authority in delivering State Route 17/85 interchange project by advancing $19.3 million in federal funding capacity. • Santa Clara paid MTC back with local sales tax dollars — cash. • MTC used new cash account to facilitate future swaps of local monies to projects having difficulty obligating federal dollars (“get out of jail free” card).

  24. 6. Use It or Lose It

  25. State Law (SB 45 and AB 1012) requires regions to obligate federal and state funds by certain deadlines, or risk losing the money • MTC has established even more aggressive deadlines in the Bay Area • MTC has financial tracking system to monitor performance and provides technical assistance to speed project delivery

  26. Bay Area Project Delivery Keeps Pace With Appropriations

  27. 7.Discount Shopping

  28. Freeway Service Patrol • 50% of traffic congestion is incident-related • FSP fleet of 74 tow trucks patrol 450 miles of freeway • 94% “excellent service” rating

  29. 511 • Traffic and transit information with one call • Launched December 2002 • Already doubled call volumes over 817-1717

  30. TransLink® • Successful technology test in 2002 • 90% customer satisfaction • Poised for regional roll-out in late 2003

  31. www.transitinfo.org • Convenient online trip planning • All major transit systems by end of 2003 • Has served 2 million customers since Summer 2001

  32. For more information, contact: Metropolitan Transportation Commission 101-8th St. Oakland, CA 94607 Tel. 510.464.7700 Fax 510.464.7848 E-mail info@mtc.ca.gov Web www.mtc.ca.gov

  33. Metropolitan Transportation Commission

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