California’sInfrastructureCrisis February 5, 2012

Statewide Transportation System Needs Assessment 2011 “California’s transportation system is in jeopardy. Underfunding – decade after decade - has led to the decay of one of the State’s greatest assets.” - California Transportation Commission California Transportation Commission

Neglected Improvements are Staggering California’s unfunded needs are - California Transportation Commission - California Transportation Commission Statewide Transportation Needs Assessment

Caltrans Maintenance Needs are Growing 4 - Legislative Analyst’s Office, Legislative Analyst’s Office, 2011

Infrastructure Report Card 5 - Statewide Transportation Needs Assessment 2011 CALIFORNIA  Pavement:  58% of California Roadways Require Rehabilitation or Pavement Maintenance  Bridges:  20% Require Major Maintenance or Preventative Work  6% Require Complete Replacement

Infrastructure Report Card 6 - Texas Transportation Institute CALIFORNIA  6 of the Nation’s 10 Worst Urban Area Pavement Conditions  14 of the Nation’s 20 Most Congested Transportation Corridors  66% of California’s Major Urban Highways are Congested

Poor Road Conditions  Cost Californian’s $13.9B Annually  $586 Per Motorist  Contribute to More Than One-Half of US Highway Fatalities:  More than Drunk Driving, Speeding or Failing to use Seat Belts 7 - TRIP

Population will Grow from 38MM to 44MM by 2020 VMT is growing 10 times faster than lane miles. - Governor’s 2006 Strategic Growth Plan Truck freight is expected to increase 75% by Statewide Transportation Needs Assessment

Funding Will Collapse in

Jobs 10  Each $1B Invested in Transportation Creates approximately 30,000 Jobs (15,000 Direct and Indirect Transportation Jobs & 15,000 Induced Jobs)  The Construction Industry is Reporting 20-40% Unemployment - Federal Highway Administration - Federal Highway Administration

Commerce at Risk  84% of U.S. Economy Dependent on Transportation Infrastructure  Fully Funding Transportation Needs Would Increase California’s Gross State Product 5% – 7% 11 - Statewide Transportation Needs Assessment US Chamber Foundation Study

Funding Solutions  Encourage Public-Private Transportation Investment  Reinstate Vehicle License Fee  Annual Increase of Fuel User Fee  Harvest Cap & Trade Fees  Institute a Tire User Fee  Institute VMT Fee 12

Public-Private Transportation Investment

Public-Private Investment 14 P UBLIC -P RIVATE T RANSPORTATION I NVESTMENT  Encourage Privatization of Transportation Systems, when applicable  Support Appropriate Revenue Generation (Tolls or Other Mechanisms) to Attract Private Transportation Investment

 Transportation California Recommends:  Adopting Legislation Necessary to Attract Private Transportation Investment  California’s Goal Should be to Attract $1B of Private Investment into Transportation Infrastructure Annually Recommendation 15 P UBLIC -P RIVATE T RANSPORTATION I NVESTMENT

Vehicle License Fee (VLF) 16

 Transportation California recommends  Transportation California recommends:  Increase Vehicle License Fee to Pre-2006 Rate Schedule  2% of Vehicle Value (currently.64%)  1.36% of the Taxable Value of California’s Vehicles Raises approx. $3.7B Annually Recommendation 17 V EHICLE L ICENSE F EE (VLF)

Fuel User Fee S OLUTIONS

Fuel User Fee Increase Will…  Promote Innovation  Decrease Dependency on Foreign Oil  Improve Air Quality  Fund a Modern Transportation System  Create Jobs 19 F UEL U SER F EE

Fuel User Fee  Most Practical Funding Solution  Simple & Fair  Easily Administrated  In Concert with Sound Energy Policy  Surprisingly Inexpensive 20 F UEL U SER F EE

Fuel User Fees Too Low 21 F UEL U SER F EE  California - 55 ¢ Per Gallon - Building America’s Future  Fees Cover Only 50% of Road Maintenance & Operations - Building America’s Future Transportation Infrastructure Report 2011 Transportation Infrastructure Report 2011  Canada & Europe – $4.43 Per Gallon (Average) Fuel User Fees are Green!

Each 1 ¢ Fuel User Fee  Costs the Average Driver $5.54 Per Year  Raises $200MM Annually 22 F UEL U SER F EE

Recommendation  Transportation California recommends  Transportation California recommends:  A Regular Annual Fuel User Fee Increase of 8¢ Per Gallon  8¢ per Gallon Raises approx. $1.6B Annually 23 F UEL U SER F EE

Harvest Cap & Trade Fees

Cap & Trade Fees 25 C AP & T RADE F EES  California will Begin Collecting Fees Associated with Fossil Fuel-Related Air Pollution in 2012  Re-investing Cap & Trade Fees into California’s Transportation System will:  Improve Air Quality  Reduce Emissions  Serve the Goals of Cap and Trade Policy

 Transportation California recommends:  Cap & Trade Fees Collected from Transportation-Related Pollution be Directed to the Maintenance of California’s Transportation System  Cap & Trade Fees Could Raise $2B Annually Recommendation 26 C AP & T RADE F EES

Tire User Fee

Recommendation 28 T IRE U SER F EE  California Consumes approx. 35MM Tires Annually  Transportation California Recommends:  A $10 Per Tire User Fee be Assessed  A $10 Per Tire Fee Raises approx. $350MM Annually

Vehicle Miles Traveled (VMT) Fee

Recommendation 30 V EHICLE M ILES T RAVELED (VMT) F EE  Californian’s Travel approx. 350B Miles Each Year  Transportation California Recommends:  A 1¢ Per Mile VMT Fee  1¢ Per Mile VMT Fee Raises $3.5B Annually

Funding Solutions Raise Annually Encourage Public-Private $1.0B Transportation Investment Reinstate Vehicle License Fee$3.7B Annual Increase of Fuel User Fee$1.6B Harvest Cap & Trade Fees$2.0B Institute a Tire User Fee$.35B Institute VMT Fee$3.5B 31 $1B equals 30,000 Jobs

Infrastructure investment will energize economic performance! 32