RECOMMENDATION

It is recommended that the Agency approve Resolution No. 01-07 endorsing Proposition 42 to be included on the March, 2002 General Election.

SUMMARY

Proposition 42 has been placed on the March 2002 ballot. Since this measure will increase funding for transportation related purposes, it may be appropriate for the Agency take a position on this measure.

DISCUSSION

In the last few years there has been considerable discussion throughout the state as how to increase revenues available for transportation, both for capacity increasing projects as well as for rehabilitation and maintenance. This need for additional funding was recognized by the Davis administration which has earmarked nearly $5 billion in state revenues for transportation related purposes. Although this $5 billion is much needed for transportation, it is recognized statewide that there is additional demand for an ongoing revenue stream. Proposition 42 has been drafted to address, at least partially, this discrepancy between revenues available for transportation and transportation needs.

Proposition 42 makes available the existing sales tax on gasoline be used to fund street, road, highway and public transit improvements. It keeps faith with motorists who reasonably believe the taxes they pay at the pump support our transportation system. The revenues generated from the sales tax on gasoline will be earmarked for several purposes. Twenty percent of the money will be distributed directly to cities for street and road maintenance. Twenty percent will be distributed directly to counties for street and road maintenance. Forty percent of the money will be made available to the State Transportation Improvement Program (STIP) to generally fund transportation projects statewide. Finally, 20% of the money will be deposited into the Public Transportation Account to fund transit programs and projects.

At this time precise revenue projections have not been made available by Caltrans, however, the impact on Shasta County is estimated to be an additional $1 million among the three cities and the County for additional maintenance. An additional $1 million per year will go into the Regional Improvement Program for the region. The 20% going into the Public Transportation Account, in all likelihood, will fund passenger rail deficits statewide.

ALTERNATIVES

The Agency could chose to not endorse this proposition. This is not recommended because there is a need for additional transportation dollars within Shasta County. Further, since this proposition will not raise taxes but simply devote current sales taxes on gasoline sales to transportation, it seems appropriate that this Agency support it.

OTHER AGENCY INVOLVEMENT

This item was discussed at the November 27 Technical Advisory Committee meeting.

FINANCING

There will be no significant financial impact on the RTPA regardless of the outcome of the measure.

Daniel J. Kovacich, Executive Officer

/jmg

Attachment: Resolution No. 01-07