COUNTY OF SAN MATEO

Inter-Departmental Correspondence

County Manager’s Office

 

DATE:

April 27, 2006

BOARD MEETING DATE:

May 2, 2006

SPECIAL NOTICE/HEARING:

None

VOTE REQUIRED:

Majority

 

TO:

Honorable Board of Supervisors

FROM:

John Maltbie, County Manager

SUBJECT:

County Manager’s Report #8

A.

Resolution in support of AB 2503 (Mullin), affordable housing and with a request to amend the bill to ensure that “excess ERAF” funds are not used to backfill reductions in ERAF funding associated with local contributions to Housing Trust Funds

 

RECOMMENDATION:

Adopt a resolution in support of AB 2503 (Mullin), affordable housing and with a request to amend the bill to ensure that “excess ERAF” funds are not used to backfill reductions in ERAF funding associated with local contributions to Housing Trust Funds.

 

VISION ALIGNMENT:

Commitment: Responsive, effective and collaborative government

Goal(s): Goal 20—Government decisions are based on careful consideration of future impact, rather than temporary relief or immediate gain.

 

BACKGROUND:

AB 2503 (Mullin) would authorize cities and counties to enter into agreements for the creation of Housing Trust Funds that can be used for the acquisition, construction or development of affordable housing. This bill as drafted would also reduce a participating county’s Educational Revenue Augmentation Fund (ERAF) by an amount equal to the amount deposited annually into the county’s Housing Trust Fund.

 

Since 1992 the State has met its financial obligation to fund education by taking specified amounts of city, county and other local agency property taxes and shifting these revenues to the Educational Revenue Augmentation Fund (ERAF). In 2005-06 local governments lost $72 billion in property tax revenues. Since the inception of ERAF, the loss is estimated at $58 billion.

 

DISCUSSION:

AB 2503 is intended to encourage the creation and funding of Housing Trust Funds for the development of affordable housing. Initial analysis of AB 2503 suggest that local governments can reduce their ERAF loss by an amount of funding equal to what they elect to contribute to a Housing Trust Fund. This has the effect of directing funding to affordable housing that would otherwise go toward relieving the state from its obligation to fund education.

 

Further analysis raises the concern that in basic aid schools where existing revenues adequately meet the minimum funding requirements, “excess ERAF” funding, not used for the minimum requirements, would be used as backfill for the Housing Trust Fund related reductions in ERAF.

 

County Counsel staff has developed some proposed amendments to AB 2503 that may address this problem.

 

AB 2305 may undergo further amendments that limit to 20% the amount of reductions a county can make to the ERAF shift.

 

FISCAL IMPACT:

Unknown. Potentially positive.

 
 

B.

Resolution in support of SB 1431 (Cox), design-build contracting for cities, counties and special districts

 

RECOMMENDATION:

Adopt a Resolution in support of SB 1431 (Cox), design-build contracting for cities, counties and special districts.

 

VISION ALIGNMENT:

Commitment: Responsive, effective and collaborative government

Goal(s): Goal 20—Government decisions are based on careful consideration of future impact, rather than temporary relief or immediate gain.

 

BACKGROUND:

SB 1341 (Cox) would allow all counties, cities and special districts to use the design-build contracting method. It would also make a number of less significant changes include the unification of the various sunsets provisions to sunset on January 1, 2017.

 

Current law requires local governments to separate the design and construction components of projects. Through this design-bid-build process, local governments invite bids for construction projects and award the project to the lowest responsible bidder based on set designs. Design-build allows the authorized agency to procure both design and construction services from a single entity (i.e. company, contractor).

 

Since 1995, the Legislature has allowed a growing number of local governments to use design-build contracts. Currently 30 counties have design-build authority.

 

DISCUSSION:

According to the Senate Local Government Committee analysis, the design-build concept is partly in response to public pressure to keep costs low, but provide high levels of accountability and transparency. Traditional design-bid-build contracts are often seen as providing higher levels of transparency and accountability due to the use of two rounds of contracts (one for the design and one for the construction). However, that process is also considered slower and more expensive. In addition, some proponents believe the combination of design-build provides more flexibility to respond to changing conditions and requirements of the site.

 

Staff and advocate conversations with the author’s office suggest the general authorization provisions will face strong opposition and may be amended from the bill. Should San Mateo County elect to support SB 1431, staff can work with the author’s office to ensure that San Mateo County specifically be authorized with such authority should the general provisions be removed from the bill.

 

FISCAL IMPACT:

Unknown.

 
 

C.

Resolution in support of SB 1812 (Runner), surface transportation project delivery pilot program

 

RECOMMENDATION:

Adopt a resolution in support of SB 1812 (Runner), surface transportation project delivery pilot program.

 

VISION ALIGNMENT:

Commitment: Responsive, effective and collaborative government

Goal(s): Goal 20—Government decisions are based on careful consideration of future impact, rather than temporary relief or immediate gain.

 

BACKGROUND:

The Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU) is the most recent federal transportation authorization act. SAFETEA-LU includes an optional pilot project for five states, including California, to assume the responsibilities of the U.S. Department of Transportation (DOT) under the National Environmental Policy Act (NEPA). SB 1812 would signal California’s participation in the pilot by authorizing Caltrans to assume DOT responsibilities under NEPA, and, in turn, to consent to the jurisdiction of the federal courts with regard to lawsuits filed under NEPA.

 

Under current law, California (Caltrans) drafts Environmental Assessments and Environmental Impacts Statements under NEPA and other federal environmental laws. These drafts are sent for review and approval to the Federal Highway Administration (FHWA), which reviews NEPA documents for DOT. As part of its review, FHWA can refer the NEPA documents to other reviewing agencies (i.e. the Fish and Wildlife Service) and/or request additional information and comment from Caltrans. However, since 1990 California has been delegated administratively the ability to make categorical exclusions—the determination that a project falls within predetermined categories of projects unlikely to cause environmental harm and thus exempt such projects from greater environmental review.

 

Under current law, including the administrative delegation, FHWA assumes liability for legal challenges under NEPA.

 

DISCUSSION:

The intent of SB 1812 is to expedite the NEPA environmental review process for projects provided under SAFETEA-LU by removing FHWA from the NEPA process and having Caltrans assume those duties. With this responsibility, legal liability for NEPA lawsuits would also transfer from FHWA to Caltrans. Federal regulations to be promulgated will provide greater guidance and requirements in assuming various FHWA NEPA activities.

 

The federal pilot and SB 1812 provide Caltrans (in negotiations with FHWA) the discretion to determine the scope of FHWA responsibilities it wishes to assume—especially with consideration for expected regulations. It is unclear what specific FHWA NEPA responsibilities Caltrans seeks to assume. Presumably, Caltrans will seek authority in excess of its current administratively delegated authority for categorical exclusions. However, the type (i.e. state highway system and/or local assistance projects) and the depth (i.e. categorical exclusions, Finding of No Significant Impact (FONSI), etc.) of responsibilities California would assume would be left to Caltrans to determine.

 

SB 1812 would also result in increased costs for the additional staff and time needed to review NEPA documents. However, time savings particularly for more complex projects could be significant.

 

Opponents note that SB 1812 can allow Caltrans to review and approve NEPA documents on their own projects. With an interest in delivering its projects, Caltrans could minimize the environmental impacts of their projects. This perception of conflicting interests combined with the assumption of liability has the possibility of generating lawsuits that would otherwise be avoided under current law.

 

Public Works does not anticipate any immediate time savings from SB 1812 authority. Many of our currently planned projects that are subject to NEPA are County road resurfacing activities, which qualify for categorical exclusions. However, if the County plans to federal funds for future road improvements, SB 1812 authority has the potential to simplify the approval process through Caltrans.

 

SB 1812 was recently amended to sunset Caltran’s authority by January 1, 2009 and to require the department to conduct a comparative analysis of the pilot.

 

FISCAL IMPACT:

Unknown.