COUNTY OF SAN MATEO

Inter-Departmental Correspondence

County Manager’s Report

DATE:

September 10, 2008

BOARD MEETING DATE:

September 16, 2008

SPECIAL NOTICE/HEARING:

None

VOTE REQUIRED:

Majority

TO:

Honorable Board of Supervisors

FROM:

John L. Maltbie

SUBJECT:

County Manger’s Report #10

A.

Resolution in support of Proposition 1A and Assembly Bill 3034 (Galgiani), Safe, Reliable High-Speed Passenger Train Bond

RECOMMENDATION:

Adopt a resolution in support of Proposition 1A and Assembly Bill 3034 (Galgiani), Safe, Reliable High-Speed Passenger Train Bond

VISION ALIGNMENT:

Commitment: Responsive, effective and collaborative government.

Goal(s): 1—Leaders throughout the County provide the impetus for broader regional solutions in land use, housing childcare, education, health and transportation.

BACKGROUND:

Proposition 1 authorizes the state to sell $9.95 billion in general obligation bonds to fund (1) pre-construction activities and construction of a high-speed passenger rail system in California and (2) capital improvements to passenger rail systems that expand capacity and /or enable train riders to connect to the high-speed rail system.

Of the total amount, $9 billion would be used, together with any available federal monies and funds from other sources, to develop and construct a segment of the high-speed train from the San Francisco Transbay Terminal to Los Angeles Union Station.

Assembly Bill 3034 (Galgiani) Safe, Reliable High-Speed Passenger Train Bond Act for the 21^st Century, which was signed into law by Governor Schwarzenegger on August 26, 2008, amends Proposition 1 by adding several provisions that are designed to increase the accountability of the state board that is planning the project. Changes include requiring the formation of a review committee of engineering and financial experts to evaluate the assumptions of the board overseeing the rail project, requiring the board to prepare a new financial plan for the system by September 1 and limiting the amount of bond money that could be used for planning, engineering and administration. The revised bond measure will appear on the November ballot as Proposition 1a. Your Board supported Assembly Bill 3034.

DISCUSSION:

California established the California High-Speed Rail Authority in 1996 to develop an intercity rail system connecting the major metropolitan areas of California and providing service between Northern California and Southern California. Similar to existing systems in Japan and Europe, these trains are intended to operate at speeds of 200 miles per hour or faster.

Over the past 12 years, the Authority has spent about $60 million for preconstruction activities, such as environmental studies and planning related to the development of a high-speed rail system. Construction of the main project is now estimated to cost $33 billion and the additional spurs would be $4 billion each. The initial bond money, which would be provided by Proposition 1a, would be used to leverage additional funds from private and Federal government sources. In addition to the new high-speed rail system, Proposition 1 would set aside $950 million in funding for capital projects that improve other passenger rail systems in order to enhance these systems’ capacity and/or allow riders to connect to the high-speed rail system.

Ongoing legislative discussions regarding oversight of the High-Speed Rail Authority, as well as the terms of the bond, prompted the introduction of Assembly Bill 3034 (Galgiani) Safe, Reliable High-Speed Passenger Train Bond Act for the 21^st Century earlier this year. The bill imposes a number of checks on the Authority’s financial and operational accountability. Supporters of the bond cleanup legislation are hoping that the changes to the bond measure will boost its chances of passage in November.

The Legislative Committee has reviewed Proposition 1A and recommends support.

FISCAL IMPACT:

The Legislative Analyst’s Office (LAO) estimates that the bond would have a state cost of about $19.4 billion over 30 years to pay off both the principal ($9.95 billion) and interest ($9.5 billion) on the bonds. The average payment for principal and interest would be about $647 million per year. The LAO also estimates that the high-speed rail system would incur ongoing maintenance and operation costs that are probably in excess of $1 billion a year. According to the LAO, depending on the level of ridership, these costs would be partially offset by fares paid by passengers. The Authority, however, claims that the system would not require operating subsidies and would generate $1billion in annual profits.

B.

Resolution in opposition of Proposition 8, Limit on Marriage, Constitutional Amendment

RECOMMENDATION:

Adopt a resolution in opposition to Proposition 8, Limit on Marriage, Constitutional Amendment

VISION ALIGNMENT:

Commitment: Realize the potential of our diverse population.

Goal(s): 1—Our diverse population works well together to build strong communities, effective government and a prosperous economy.

BACKGROUND:

Proposition 8 would amend the California Constitution to specify that only marriage between a man and a woman is valid or recognized in California.  Marriage would be limited to individuals of the opposite sex, and individuals of the same gender would be denied the right to marry in California, as currently permitted.  The measure would deprive same-gender couples from receiving equal treatment in our State as it relates to marriage.  

DISCUSSION:

In March 2000, California voters passed Proposition 22, which specified in State law that only a marriage between a man and a woman is valid or recognized in California.  On May 15, 2008, the California Supreme Court ruled that marriage is a fundamental constitutional right and limiting marriage to persons of the opposite sex violates the equal protection clause of the California Constitution.  The Court ordered the language to be stricken from the statute, making marriage between individuals of the same sex valid or recognized in the state. 

California is the second state in the nation to allow same-gender couples to marry.  In 2003, the Massachusetts Supreme Court held that state law barring same-gender marriage was unconstitutional under the state constitution.  The Court further ruled in 2004 that "civil unions" still excluded same-gender couples from the benefits of marriage under the constitution.  In 2004, Massachusetts became the first state to offer same-gender marriages. 

Many other states offer various types of relationship recognition to same-gender couples.  These include civil unions, domestic partnerships, and reciprocal beneficiaries.  The rights provided to same-gender couples vary under each type of relationship recognition.  Some, such as civil unions and domestic partnerships (depending on the state), provide the same legal rights and responsibilities of marriage.  However, supporters of same gender marriage argue that these are inferior substitutes and do not provide the dignity and respect that our society places on the institution of marriage.

Although the State sets marriage law, the 1996 Defense of Marriage Act (DOMA) bars Federal recognition of same-gender marriage.  Furthermore, the Federal government controls some important marriage rights and benefits, which are not provided to same-gender couples.  Same-gender couples who affirm their commitment to each other are not eligible for Social Security benefits, immigration privileges, or the marriage exemption to Federal estate, transfer, or gift taxes. 

The County has long supported the rights of same-sex couples by providing domestic partner benefits to its employees.

The Legislative Committee has reviewed Proposition 8 and recommends opposition.

FISCAL IMPACT:

The Legislative Analyst's Office (LAO) expects that since marriage between same-sex couples is now legal in California, there would likely be an increase in spending on weddings by same-sex couples in California over the next few years.  This would result in increased revenue, primarily in sales tax revenue to state and local governments.  If the measure passes, it could result in revenue loss, mainly from sales taxes, to state and local governments.  These losses could potentially total in the several tens of millions of dollars over the next few years.