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Agenda Item 13.
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| City Council Meeting |
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| Subject: |
| The Road Repair and Accountability Act of 2017, Local Streets and Roads Funding 2018 Annual Reporting Guidelines |
| RECOMMENDATION |
| Approve a Resolution to Adopt a List of Projects Funded by SB1: The Road Repair and Accountability Act |
| BACKGROUND/DISCUSSION |
On April 28, 2017 the Governor signed Senate Bill (SB) 1 (Beall, Chapter 5, Statutes of 2017), which is known as the Road Repair and Accountability Act of 2017 ("RRAA"). The RRAA increases the per gallon fuel excise taxes by 12 cents, increases diesel fuel sales taxes by 20 cents, and increases vehicle registration fees with a provision for inflationary adjustments to tax rates in future years. The main objective of the RRAA is to address basic road maintenance, rehabilitation, and critical safety needs on both the state highway and local streets and road system.
On November 1, 2017, the State Controller ("Controller") began depositing various portions of this new funding into the newly created Road Maintenance and Rehabilitation Account ("RMRA"). A percentage of this new RMRA funding has been apportioned by formula to eligible cities and counties pursuant to Streets and Highways Code ("SHC") Section 2032(h) for basic road maintenance, rehabilitation, and critical safety projects on the local streets and roads system. It is estimated that Orange County will receive approximately $12M in Fiscal Year ("FY") 2017-18 and approximately $34M in FY 2018-19 with projected increases out to FY 2026/27. Of this County estimated apportionment amount, the City of Brea is estimated to receive approximately $246,000 in FY 2017/18 and $734,000 in FY 2018-19 pursuant to the SHC Section 2032 (h) formula. The first apportionment for the disbursement of RMRA funds to cities and counties for FY 2017-18 began in January, 2018. To date, Brea has received approximately $77,000 from the Controller, which has been placed in a newly created fund entitled "Road Maintenance and Repair Act" (Fund 221).
Additionally, the RRAA emphasizes the importance of accountability and transparency in the delivery of California’s transportation programs. Therefore, in order to be eligible for RMRA funding, the statute requires cities and counties to provide basic annual RMRA project reporting to the California Transportation Commission ("Commission"). These reporting requirements, as well as other fund use requirements and accounting processes, were developed within an RRAA Local and Streets and Road Funding Annual Reporting Guidelines document ("RRAA Guidelines"). On August 16, 2017, the Commission approved the final RRAA Guidelines for FY 2017-18. The Guidelines were updated in early March, 2018, which were adopted by the Commission on March 21, 2018. (See attached 2018 RRAA Guidelines).
One of the requirements within the 2018 RRAA Guidelines requires cities and counties to adopt a project list by resolution for the use of the funds for submittal to the Commission on May 1, 2018, prior to the submittal to the State Controller. However, the majority of the cities and counties have yet to adopt their FY 2018-19 budgets to appropriate the funds. The City's 2017-18 Capital Improvement Program ("CIP") proposed the Puente Street Rehabilitation Project (Project No. 7311) ("Project") in FY 2018-19, but it was unfunded. Therefore, staff recommends programming the RMRA funds for this project in FY 2018-19 within the FY 2018-19 CIP and submitting this as the Project List for the Commission to consider. It is anticipated that the recommendation for the adoption of the City's FY 2018-19 Operations and CIP budget by City Council will occur at the first City Council meeting in June, 2018. Staff has prepared a Resolution to adopt the Project List, which complies with the 2018 RRAA Guidelines (see Resolution).
The FY 2018-19 project is Puente Street Rehabilitation between Imperial Highway and Lambert Road. |
| FISCAL IMPACT/SUMMARY |
SB 1 (RRAA) was signed by the Governor on April 28, 2017, which provides additional Gas Tax funds from increases to gas fuel and diesel fuel taxes, and vehicle registration fees. The main objective of the RRAA is to address basic road maintenance, rehabilitation, and critical safety needs on both the state highway and local streets and road system. The 2018 RRAA Guidelines require cities/counties to adopt a project list by resolution to use the FY 2018-19 RMRA funds and submit to the Commission by May 1, 2018. Staff has identified a project within the Draft 2018 CIP, Project 7311, that would be eligible for these funds in the amount of $734,000 in FY 2018-19. Therefore, staff recommends that the City Council consider approving a Resolution that adopts the RMRA Project List for submittal to the Commission by May 1, 2018. If approved, staff will program the RMRA funds within the 2018-19 CIP for Project 7311. See the following budget table:
| Funding Source |
Proposed 2017
CIP Budget
FY 2018-19 |
Proposed 2018 Draft
CIP Budget
FY 2018-19 |
| Unfunded |
$ 700,000 |
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| RMRA Funds (Fund 221) |
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$734,000 |
| Total |
$ 700,000 |
$ 734,000 |
Based on the proposed budget within the table above, the project budget will increase by $34,000 with the new RMRA funds and be fully funded. Therefore, there is no impact to the General Fund for this item. |
| RESPECTFULLY SUBMITTED: |
William Gallardo, City Manager
Prepared by: Steve Kooyman, P.E., City Engineer
Concurrence: Tony Olmos, P.E., Public Works Director |
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