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Agenda Item # 16

BOARD MEMORANDUM

BACKGROUND:

In December 2004, the VTA Board of Directors authorized the release of a draft investment strategy to fund the public transit component of VTA’s Valley Transportation Plan 2030. 

On February 18, 2005, VTA staff released a Draft Long-Term Transit Capital Investment Program (Draft TCIP), which   describes planned transit improvement projects and capital investments occurring in the next 30 years.   The investment program is divided into two components: (1) improvement projects in the 2000 Measure A Transit Improvement Program, and (2) ongoing capital investments necessary to support VTA public transit services. 

Financial assumptions in the Draft TCIP include the availability of a potential, new permanent ½-cent sales tax, with 75% of revenues going to VTA and 25% going to the 15 cities and the County of Santa Clara for local transportation projects.   The proceeds from the additional ½-cent sales tax would allow VTA to deliver the entire 2000 Measure A Program, as well as and fund bus and light rail service increases, new transit services, and existing and future capital requirements for the next 30 years.  VTA would use the proceeds and bonds against this new revenue source to supplement funding from the 2000 Measure A ½-cent sales tax, and federal and state funding sources.

DISCUSSION:

The Draft TCIP was distributed to local jurisdictions and stakeholders to solicit dialogue about specific components of the proposed plan and the viability of the selected funding strategy.    VTA staff gave presentations detailing the elements of the funding strategy to local city and town councils and to the County Board of Supervisors during March and April 2005.  Attached is a listing of Draft TCIP presentations (Attachment A).  Staff presentations will conclude the week of April 18, 2005.

Based on preliminary responses received at the presentations, some general comments were expressed:

• No strong countywide support for a ½-cent sales tax to fund local transportation projects.
  Some jurisdictions took a position against a new, permanent ½-cent sales tax to supplement funding for 2000 Measure A projects. Although some cities support the Draft TCIP, overall no jurisdiction expressed support for a new ½-cent sales tax.

• Discussion of Silicon Valley Leadership Group’s poll on countywide sales tax approval.
  According to recent polling conducted by the Silicon Valley Leadership Group (Attachment B), Santa Clara County voters may be more likely to approve a new ¼-cent sales tax in 2006. As a result, some jurisdictions were interested in evaluating funding scenarios that utilize a ¼-cent sales tax as well as no new revenue source. 

• Concerns about the viability of federal and state funding.
  Many local jurisdictions questioned assumptions regarding funding for the BART to Silicon Valley Project.   Jurisdictions requested an updated funding strategy that presented more conservative revenues from the Federal New Starts Program, the   State Traffic Congestion Relief Program, and the State Transportation Improvement Program. 

• Continued support for the BART to Silicon Valley Project, but not at the expense of other 2000 Measure A projects.
  During its initial discussions of a long-term funding strategy, the VTA Board provided direction as to the completion of projects in the 2000 Measure A Program.   Local jurisdictions were concerned that the BART to Silicon Valley project received priority, thereby possibly deferring other projects until the latter part of the 2000 Measure A Program. 
  
  There was interest in developing both Measure A and non-Measure A projects that would serve countywide transportation needs while still delivering the BART project.   Another suggested strategy for balancing countywide needs was to phase the completion of the BART project.  Cities were concerned that no investment strategy was presented that considered phasing BART and accelerating other localized projects.  In addition, it was suggested that cities directly benefiting from the project should supply an alternate funding source to help finance the extension.   

Prior to the Board Workshop held on April 22, 2005, the VTA Board received a compilation of position statements from local jurisdictions, the Downtown East Valley Policy Advisory Board, and the VTA Policy Advisory Committee (Attachment C).

At the April 22, 2005 Workshop, staff provided a summary of the comments received from local jurisdictions and the Silicon Valley Leadership Group poll.   In addition, staff presented the three alternate funding scenarios requested: (1) no new sales tax; (2) a new, permanent ¼-cent sales tax; and (3) a revised ½-cent sales tax.  All three strategies, which utilize more conservative assumptions for federal and state funding, were presented for Board discussion of constraints and opportunities. 

CONTACT THE BOARD SECRETARY'S OFFICE FOR ATTACHMENTS.

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