Innovative Financing Schemes

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InnovativeFinancingSchemes

• Steve HemingerExecutive Director, MTC
• Sonoma Transportation SummitJune 21, 2006

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Vaudeville definition of Innovative Finance

• I Dont Have Any Money. Do You?

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Is the Gas Tax a Goner?
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• Read my Lips No New Taxes

• George H. W. Bush, 1998

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State Gas Tax Hasnt Kept Pace
The states gas tax has lost one-third of its
value since 1964, adjusted for inflation.
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Feds to the Rescue? Not Likely
Purchasing power of federal gas tax has also
eroded due to inflation
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The Gas Tax Vanishing Act

• No federal rate increase since 1993
• Less than 1/3 of states have raised the state gas
  tax since 1993
• 6 of 15 states with tax hikes were due to
  automatic indexing

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Far Higher Gasoline Prices Abroad
Gasoline Prices for Selected Countries, 2005
Source International Energy Agency, April 2005
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• You Say You Want a Devolution?

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• Its our money, and were free to spend it any
  way we pleaseIf you have money you spend it and
  win.

• Rose Kennedy

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Local Sales Tax Revenues Dwarf STIP

• All Bay Area counties except Napa and Solano
• 23 billion over 30 years

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Voting Results on Transportation Funding Ballot
Measures
Bay Area vs. State
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Devolution Losers

• Rural counties with small tax base and anti-tax
  ethos
• Large lumpy projects that dont neatly fit
  within county shares
• Modes that lack electoral appeal bikes vs.
  freight

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• Son, Can I Borrow the Charge Card?

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Proposition 1B Transportation Bond
Dollars in billions
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Bay Areas Share ofLocal Streets and Roads
Funding
County
Allocation
Alameda
75.0
Contra Costa
52.1
Marin
14.5
Napa
9.1
San Francisco
40.0
San Mateo
40.8
Santa Clara
91.7
Solano
24.3
Sonoma
27.9
Regional Total
375.4
Dollars in millions
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Bay Areas Share ofSTIP Funding
County
Amount
Alameda
54.5
Contra Costa
35.2
Marin
10.3
Napa
6.4
San Francisco
27.8
San Mateo
28.7
Santa Clara
63.8
Solano
16.7
Sonoma
20.4
Subtotal
263.8
Interregional (Est.)
84.1
Regional Total
347.9
Dollars in millions
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Public Transit Funding Bay Area Share
Agency
Amount
AC Transit
107
BART
246
Caltrain
40
Golden Gate
40
SF Muni
336
SamTrans
47
VTA
144
Regional
347
Other
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Total
1,334
Dollars in millions
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Bay Area Funding Shortfall 18 Billion

• 80 percent of the regions funds will go to
  maintain our existing road and transit system.
• Even with passage of November 2006 bond, large
  shortfalls remain.

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Growing Reliance on Non-User Fees
Source Surface Transportation Policy Project,
2002
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• Does the Road Toll for Thee?

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Original Toll Concept River Chains
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Congestion Tolls
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Orange County SR 91 Express Lanes
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San Diego I-15 Express Lanes
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Proposed Alameda I-680 Concept

• Limited access
• Double-yellow stripe separation with intermediate
  access (access design under study)
• Toll varies by time of day, day of week
• Early polling 60 to 70 support (project area)

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Conceptual Regional HOT Network
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Federal Legislation SAFETEA

• Value Pricing Pilot Program
• 15 demonstration projects
• 11 to 12 million/year
• Broad permission to convert HOV to HOT
• Must maintain service levels (45 mph minimum)
• Encourages directing excess revenue to
  ridesharing and highway safety programs

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• Have I Got a Bridge to Sell You?

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Current U.S. Toll Road Privatizations A Brief
History
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Current Privatized U.S. Toll Roads Investment
and Operating Profile
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Ownership Structure of Current Privatized U.S.
Toll Roads
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Projects Under Agreement Or In Progress
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Key Policy Questions

• How high could tolls really get?
• Why doesnt the public agency just raise tolls
  itself?
• Where does the lease revenue go?
• What if the asset needs to be replaced during the
  term of lease?

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For more information, visithttp//www.mtc.ca.g
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