SBCAG STAFF REPORT

SUBJECT: Low Carbon Transit Operations Program MEETING DATE: March 16, 2017 AGENDA ITEM: 5B STAFF CONTACT: Sarkes Khachek RECOMMENDATION: 1. Adopt Resolution 17-07 approving allocation requests for Fiscal Year 2016/17 LCTOP and

authorizing the Executive Director and Deputy Executive Director to execute documents and amendments required by Caltrans to secure LCTOP funds for use and distribution.

2. Adopt Resolution 17-08 authorizing the submittal of project nominations and allocation

requests for Fiscal Year 2016-17 LCTOP funding for City of Guadalupe, Santa Barbara Metropolitan Transit District (MTD), North County Intercity Saturday Service and SBCAG Traffic Solutions

SUMMARY: In December 2016, Caltrans released the final Fiscal Year 2016/17 guidelines for the Low Carbon Transit Operations program (LCTOP). As a result of lower than expected cap-and-trade auction proceeds, for FY 16/17, SBCAG has been apportioned $197,015 which is half the amount provided in FY 15/16. Transit operators have also been allocated LCTOP funds based on farebox recovery. Per State statute, 50% of the population based funds must benefit the one State designated Disadvantaged Community located in the Tanglewood area of Santa Maria. The remainder of the funds can be allocated to projects not serving the Disadvantaged Community. On December 20, 2016 and February 15, 2017 SBCAG staff convened meetings with transit operator staff to discuss the available funding and prospective projects for submittal in FY 16/17. The group’s consensus was to recommend that the board continue to fund FY 15/16 LCTOP projects including Guadalupe weekend service, North County Intercity Saturday service, and Traffic Solutions. Santa Barbara MTD also received funding for routes 1 and 2. For FY 16/17, they propose to use funding for marketing and public outreach to increase ridership system wide. SBCAG staff presented the recommended projects to TTAC on March 2 and the committee unanimously recommended approval. The applications must now be approved by the SBCAG Board on March 16 for submittal to Caltrans by March 30. After review and approval by the State, funds will be available in June 2017. The recommended action is not a project under the California Environmental Quality Act (CEQA) pursuant to section 15378 of the CEQA Guidelines.

DISCUSSION: Background The Low Carbon Transit Operations Program (LCTOP) was created to provide operating and capital assistance for transit agencies to reduce greenhouse gas emissions and improve mobility, with a priority on serving disadvantaged communities. Approved projects will support new or expanded bus or rail services, expand intermodal transit facilities, and may include equipment acquisition, fueling, maintenance and other costs to operate those services or facilities, with each project reducing greenhouse gas emissions. For regional agencies whose service area includes disadvantaged communities, at least 50 percent of the total funds received must be expended on projects that will benefit disadvantaged communities. For Fiscal Year 2016/17, the State will provide $35 million for LCTOP. The program is annually appropriated 5% of Cap and Trade funds per SB 862. The program is administered by Caltrans in coordination with Air Resource Board (ARB) and the State Controller’s Office (SCO). Funds for LCTOP are distributed to regions and transit operators using the State Transit Assistance program formula. In December, Caltrans released the final guidelines for FY 16/17. The guidelines describe the eligible projects, the evaluation criteria and reporting requirements. Applications for FY 16/17 are due to Caltrans by March 30. Funds will be released by the State Controller’s Office to agencies by June 30. Eligible Projects: Per the guidelines, approved projects will support new or expanded bus or rail services, or expanded intermodal transit facilities, and may include equipment acquisition, fueling, and maintenance and other costs to operate those services or facilities, with each project reducing greenhouse gas emissions. Disadvantaged-Community Benefits: Revenues in the Greenhouse Gas Reduction Fund must by law result in benefits to disadvantaged communities. The designation of “disadvantaged communities” is assigned to the California Environmental Protection Agency, and the establishment of guidelines for qualifying expenditures is assigned to the California Air Resources Board. The Air Resources Board adopted interim guidance on the designation of Disadvantaged Communities in 2014 using the CalEnviroScreen tool. The designation of DACs has been based on the CalEnviroScreen 2.0 for Fiscal Years 2014/15, 2015/16 and 2016/17. The Low Carbon Transit Operations Program will target grants so that at least 50% of project expenditures will benefit disadvantaged communities in agencies that include communities designated as disadvantaged. Per the Air Resources Board guidance on disadvantaged communities and CalEnviroScreen 2.0, there is one designated disadvantaged community in the Santa Maria Valley in the Tanglewood area. (Figure 1). Additional information on the disadvantaged community is provided below. Evaluation Criteria Per the Caltrans guidelines, projects must be evaluated to ensure they provide a greenhouse gas reduction benefit and evaluated to see if investments could result in projects that benefit disadvantaged communities, and/or are located within a disadvantaged community. These

criteria have been developed by the California Environmental Protection Agency and California Air Resources Board. Disadvantaged Communities Criteria For transit agencies whose service areas include disadvantaged communities per the CalEnviroScreen, at least 50% of the total moneys received shall be expended on projects or services that benefit the disadvantaged community. The guidelines provide the criteria for evaluating projects which are (1) located within a disadvantaged community, and (2) not within a disadvantaged community, but still provide a benefit to a disadvantaged community. Where applicable, eligible project sponsors shall describe the benefits of selected to disadvantaged communities in the format proscribed by Caltrans. Figure 1. Map showing the sole Disadvantaged Community in Santa Barbara County near

the City of Santa Maria.

As previously mentioned, there is one identified disadvantaged community in Santa Barbara County in the Santa Maria Valley as designated by the state. The map above provides the location of the disadvantaged community. Per the guidelines, at least 50% of funds must be expended on projects that are located within the disadvantaged community or projects not within the DAC, but still provide a benefit to a disadvantaged community. Estimated Funding for FY 16/17 Per the State guidelines, LCTOP funding is apportioned using the State Transit Assistance (STA) formula. The formula splits funding for the purposes of project selection between a population formula share for Regional Agencies and farebox recovery share for transit operators. SBCAG, as the Regional Transportation Planning Agency for Santa Barbara County, is the recipient of the population based funding. The available population share for Santa Barbara County is $197,015 which is approximately half the amount available in FY 15/16.

Population based funding available statewide: $17.3 million Available population amount for Santa Barbara County: $197,015

Recommended projects for SBCAG Population Based Funding Similar to FYs 14/15 and 15/16, SBCAG staff recommends that the population funds be distributed evenly on a 50/50 split between the North County and South Coast. This would provide $98,508 for each subregion, and as a result, all of the funding available to the North County must be spent on projects that benefit the Disadvantaged Community identified in the North County. On December 21, 2016 and February 15, 2017 SBCAG staff convened meetings with transit operator staff to discuss the FY 16/17 guidelines and available funding and to determine any prospective projects for submittal in FY 16/17. There was consensus support in the group to recommend the board fund the following projects. North County

o City of Guadalupe Saturday/Sunday Service – This service would maintain expanded Guadalupe Flyer transit service initiated in 2015 between Guadalupe and Santa Maria that will benefit the DAC identified in Santa Barbara County. The service will continue to provide extended service until 7p.m. on Saturdays and Sunday service between 8 a.m. and 5 p.m. will be initiated. This is a carryover LCTOP project from FY 14/15. The $73,000 in LCTOP fully funds the Saturday extended hours and Sunday hours.

LCTOP Population Based Funding from SBCAG– North County $73,000

o SBCAG Intercity Saturday Service – This service would continue service on the Breeze

Routes 100 and 200, and Wine Country Express, serving the Disadvantaged Community identified in Santa Barbara County. This is a carry over LCTOP project from FY 15/16.

LCTOP Population Based Funding from SBCAG– North County $25,508 LCTOP Farebox Based Funding from North County Operators $12,255

TOTAL $37,763 South Coast

o SBMTD Ridership Development Marketing Plan – This project will include development and execution of a marketing plan with free or reduced-fare transit vouchers to grow ridership through the implementation and promotion of real-time arrival information, ease of fare purchase and boarding with smartcard technology and deployment of new zero-emissions electric vehicle fleet This is a new project from SBMTD for LCTOP.

LCTOP Population Based Funding – South Coast $88,657

o SBCAG Traffic Solutions South Coast Marketing, Outreach & Incentives – Traffic Solutions will conduct direct marketing to targeted areas on the South Coast to increase transit ridership and attract new riders thereby reducing greenhouse gases. This is a carryover LCTOP project from FYs 14/15 and 15/16.

LCTOP Population Based Funding – South Coast $9,851

TOTAL $9,851

Distribution of Transit Operator Farebox Based Funding

The available farebox-based share for transit operators is $68,288.

Guadalupe $466 Lompoc $6,194 County $568 SBMTD $56,033 Santa Maria $4,525 Solvang $502 TOTAL $68,288

As mentioned previously, LCTOP Farebox Based funding is provided directly to operators by the State based on farebox recovery. Revenues provided for the North County, in the amount of $12,255 are available for projects in the North County. Transit operators in the North have agreed to contribute their funding to the North County Intercity Saturday Service project discussed below. Similar to FYs 14/15 and 15/16, North County operators are willing to do this for FY 16/17 because they receive small amounts of funding that would result in more staff resources being expended to fill out applications and conduct annual project reporting than funding received as reimbursement from LCTOP. The other operators indicate they do not have projects that would meet the eligibility requirements. The Santa Barbara Metropolitan MTD will receive $56,033 in farebox funding available solely to the Metropolitan Transit District. SBMTD will be using their farebox funding for their Marketing project described above. The programming summary for FY 16/17 LCTOP funding is included in Attachment A. The applications must now be approved by the SBCAG Board on March 16 for submittal to Caltrans by March 30. After review and approval by the State, funds will be available in June 2017. Project Selection Schedule for FY 16/17 Date Meeting/Milestone December 21, 2016

SBCAG staff meets with transit operators to discuss guidelines, available funding and prospective projects

February 15, 2017

SBCAG staff met with transit operator staff to reach consensus on applications for FY 15/16 funding.

February 21 Project submittals due to SBCAG staff March 2 SBCAG Staff presents recommendations to TTAC March 16 SBCAG Board approves project submittals from Santa Barbara County March 30 Project submittals submitted to Caltrans May Caltrans/ARB review expenditures and submit approved projects to State

Controller’s Office June State Controller’s Office releases approved project amounts to recipients.

Fiscal Year 2017/18 Funding and Disadvantaged Community Based on the updated CalEnviroScreen that the Air Resources Board and Cal EPA have approved per CalEnviroScreen version 3.0, Santa Barbara County will not have a DAC in the top 25%. This will affect identification of Disadvantaged Communities for projects funded through any State Greenhouse Gas Reduction programs. As such, our region will not be subject

to the requirement to spend at least 50% of LCTOP funds for Fiscal Year 2017/18. SBCAG staff, in coordination with the transit operators, will develop guidelines and a project selection process for FY 2017/18 funding later this year. TRANSIT OPERATOR REVIEW: SBCAG staff convened a working group of transit operator staff that met on December 20, 2016 and February 15. The project applications for City of Guadalupe, North County Intercity Saturday Service, Santa Barbara MTD and SBCAG Traffic Solutions were recommended to the board for approval on February 15 by the transit operator-working group. TECHNICAL TRANSPORTATION ADVISORY COMMITTEE RECOMMENDATION: SBCAG staff presented the recommended projects to TTAC on March 2. TTAC unanimously recommended approval of the projects for FY 16/17. ATTACHMENTS:

A. Summary of Projects Recommended for LCTOP Programming B. Resolution 17-07 – Authorized Agents and Certifications and Assurances C. Resolution 17-08 – Project Approval

Attachment ACap and Trade - Low Carbon Transit Operations Program (LCTOP)

Programming Recommendations for Fiscal Year 2016/17 LCTOP funding

AVAILABLE FUNDING FOR SANTA BARBARA (PER STATE CONTROLLER'S OFFICE) NC Saturday Intercity FY 16/17Population Based - Available to SBCAG $197,015

Direct to Operators (Farebox)Santa Barbara MTD $56,033Guadalupe $466 $466Lompoc $6,194 $6,194County of Santa Barbara $568 $568Santa Maria $4,525 $4,525Solvang $502 $502Total Farebox Funding $68,288

Contributions of farebox funds for North County Saturday Intercity Service (Guadalupe, Lompoc, County, SM, Solvang) $12,255

TOTAL LCTOP FUNDING FOR SANTA BARBARA COUNTY $265,303

POPULATION BASED PROJECTS - SBCAG Regional FundsAvailable SBCAG Funding (Population) $197,01550% Required to Disadvantaged Community in North County $98,508North County● Guadalupe Saturday and Sunday Service $73,000● Saturday Intercity Service (Breeze 100 & 200, Wine Country Express) $25,508

North County Subtotal $98,508

South Coast● SBMTD Marketing $88,657● SBCAG Traffic Solutions $9,851

South Coast Subtotal $98,508

Total Project Allocations $197,015

Summary of LCTOP Funding by Project (including population and farebox based funding$73,000

Guadalupe Saturday Service $37,763Saturday Intercity Service $144,690SBMTD Marketing $9,851SBCAG Traffic Solutions Marketing

TOTAL FUNDING FOR PROJECTS $265,303