PART 2. Transit and Intercity Rail Capital Program [75220. - 75227.]

Cal. Public Resources Code - PRC 2.

in effect

Cal. Public Resources Code - PRC § 75220. Section 75220.

(a) The Transit and Intercity Rail Capital Program is hereby created to fund transformative capital improvements, as defined in subdivision (d), that will modernize California’s intercity, commuter, and urban rail systems and bus and ferry transit systems to achieve all of the following policy objectives: (1) Reduce emissions of greenhouse gases. (2) Expand and improve transit service to increase ridership. (3) Integrate the rail service of the state’s various rail operators, including integration with the high-speed rail system. (4) Improve transit safety. (b) The Transportation Agency shall evaluate applications consistent with the criteria set forth in this part and approve a multiyear program of projects for funding pursuant to Section 75224, which may be revised as necessary. (c) The California Transportation Commission shall allocate funding to applicants pursuant to the program of projects approved by the Transportation Agency. (d) “Transformative capital improvement” means a rail, bus, or ferry transit project that will significantly reduce vehicle miles traveled, congestion, and greenhouse gas emissions by creating a new transit system, increasing the capacity of an existing transit system, or otherwise significantly increasing the ridership of a transit system.

Cal. Public Resources Code - PRC § 75221. Section 75221.

(a) Projects eligible for funding under the program include, but are not limited to, all of the following: (1) Rail capital projects, including acquisition of rail cars and locomotives, that expand, enhance, and improve existing rail systems and connectivity to existing and future transit systems, including the high-speed rail system. (2) Intercity, commuter, and urban rail projects that increase service levels, improve reliability, or decrease travel times, including infrastructure access payments to host railroads in lieu of capital investments. (3) Rail, bus, and ferry integration implementation, including integrated ticketing and scheduling systems, shared-use corridors, related planning efforts, and other service integration initiatives. (4) Bus rapid transit and other bus and ferry transit investments to increase ridership and reduce greenhouse gas emissions. (b) In order to be eligible for funding under the program, a project shall demonstrate that it will achieve a reduction in emissions of greenhouse gases. In selecting projects for funding, the Transportation Agency shall consider the extent to which a project reduces emissions of greenhouse gases. (c) The program shall have a programmatic goal of providing at least 25 percent of available funding to projects benefiting disadvantaged communities, consistent with the objectives of Chapter 830 of the Statutes of 2012. (d) In evaluating grant applications for funding, the Transportation Agency shall consider all of the following: (1) The cobenefits of projects that support the implementation of sustainable communities strategies through one or more of the following: (A) Reducing vehicle miles traveled from automobiles and the number of automobile trips through growth in transit ridership. (B) Promoting housing development in the vicinity of rail stations and major transit centers. (C) Expanding existing rail and public transit systems. (D) Enhancing the connectivity, integration, and coordination of the state’s various transit systems, including, but not limited to, regional and local transit systems and the high-speed rail system. (E) Implementing clean vehicle technology. (F) Promoting active transportation. (G) Improving public health. (2) The project priorities developed through the collaboration of two or more rail operators and any memoranda of understanding between state agencies and local or regional rail operators. (3) Geographic equity. (4) Consistency with an adopted sustainable communities strategy or, if a sustainable strategy is not required for a region by law, a regional plan that includes policies and programs to reduce emissions of greenhouse gases. (5) The extent to which a project has supplemental funding committed to it from other nonstate sources. (6) The extent to which the project will increase transit ridership. (e) Eligible applicants under the program shall be public agencies, including joint powers agencies, that operate or have planning responsibility for existing or planned regularly scheduled intercity or commuter passenger rail service, urban rail transit service, or bus or ferry transit service. (f) A recipient of moneys under the program may combine funding from the program with other state funding, including, but not limited to, the State Transportation Improvement Program, the Low Carbon Transit Operations Program, the State Air Resources Board clean vehicle program, and state transportation bond funds.

Cal. Public Resources Code - PRC § 75222. Section 75222.

(a) Applications for grants under the program shall be submitted to the Transportation Agency for evaluation in accordance with procedures and program guidelines approved by the agency. An eligible applicant may submit an application to the agency to fund a project over multiple fiscal years. The agency may make multiyear funding commitments for projects that are proposed by an eligible applicant to be funded from the program over a period of more than one fiscal year. (b) The application shall define the project purpose, intended scope, proposed cost, intended funding sources, and schedule for project completion. (c) The application shall specify the phases of work for which an eligible applicant is seeking an allocation of moneys from the program. (d) The application shall identify the sources and timing of all moneys required to undertake and complete any phase of a project for which an eligible applicant is seeking an allocation of moneys from the program. The application shall also describe intended sources and timing of funding to complete any subsequent phases of the project, through construction or procurement. (e) The application shall include information describing the funding sources and approach to ensuring that ongoing operating and maintenance costs of the project are funded through the useful life of the project, as applicable. (f) Eligible applicants may submit more than one application for grants under the program pursuant to this section. (g) An eligible applicant may use a project study report or equivalent document to demonstrate eligibility of a project for inclusion in the multiyear program of projects pursuant to Section 75224. The project study report or equivalent document shall, at a minimum, be adequate to define and justify the project scope, cost, and schedule for the project application.

Cal. Public Resources Code - PRC § 75223. Section 75223.

(a) The Transportation Agency shall conduct at least two public workshops on draft program guidelines containing selection criteria prior to approval and shall post the draft guidelines on the agency’s Internet Web site at least 30 days prior to the first public workshop. Concurrent with the posting, the agency shall transmit the draft guidelines to the fiscal committees and the appropriate policy committees of the Legislature. (b) The Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code) does not apply to the development and approval of procedures and program guidelines for the program pursuant to this section.

Cal. Public Resources Code - PRC § 75224. Section 75224.

(a) No later than July 1, 2018, the Transportation Agency shall approve a program of projects, which shall cover a period of five fiscal years, beginning with the 2018–19 fiscal year. (b) The Transportation Agency shall approve each subsequent program of projects not later than April 1 of each even-numbered year. Each subsequent program shall cover a period of five fiscal years, beginning July 1 of the year of approval, and shall be a statement of intent by the Transportation Agency for the allocation and expenditure of moneys during those five fiscal years. (c) In developing the program of projects, and consistent with the consideration of all other criteria for individual projects, the Transportation Agency shall seek to maximize the total amount of reductions in emissions of greenhouse gases that would be achieved under the program. (d) For a project to be funded from the program over a period of more than one fiscal year, the Transportation Agency, at the request of an eligible applicant and in cooperation with the commission, shall enter into and execute a multiyear funding agreement with the eligible applicant for the project for an amount of program moneys and for any duration, as determined jointly by the agency and applicant. (e) A regional transportation planning agency, as defined in Section 13987 of the Government Code, shall not be eligible to receive a grant under the Transit and Intercity Rail Capital Program in the 2026–27 fiscal year or any subsequent fiscal years unless the Transportation Agency approves the regional transportation planning agency’s long-term financial plan submitted pursuant to subdivision (d) of Section 13987 of the Government Code. The Transportation Agency shall update the guidelines approved pursuant to Section 75223 to reflect the eligibility limitation imposed pursuant to this subdivision.

Cal. Public Resources Code - PRC § 75225. Section 75225.

(a) A lead applicant agency may apply to the commission for a letter of no prejudice for a project or for any component of a project included in the program of projects approved by the Transportation Agency. If approved by the commission, the letter of no prejudice shall allow the lead applicant agency to expend its own moneys for the project or any component of the project and to be eligible for future reimbursement, as applicable, from moneys available for the program from the Greenhouse Gas Reduction Fund, created pursuant to Section 16428.8 of the Government Code, or from moneys available for the program pursuant to subdivision (a) of Section 11053 of the Revenue and Taxation Code. (b) The amount expended under subdivision (a) shall be reimbursed by the state from moneys available for the program if all of the following conditions are met: (1) The project or project component for which the letter of no prejudice was requested has commenced, and the regional or local expenditures have been incurred. (2) The expenditures made by the lead applicant agency are eligible for reimbursement in accordance with applicable laws and procedures. If expenditures made by the lead applicant agency are determined to be ineligible, the state has no obligation to reimburse those expenditures. (3) The lead applicant agency complies with all legal requirements for the project, including the requirements of the California Environmental Quality Act (Division 13 (commencing with Section 21000)). (4) There are moneys designated for the program that are sufficient to make the reimbursement payment. (c) The lead applicant agency and the commission shall enter into an agreement governing reimbursement as described in this section. The timing and final amount of reimbursement is dependent on the terms of the agreement and the availability of moneys for the program. (d) The commission, in consultation with intercity, commuter, urban rail, and other public transit entities, may develop guidelines to implement this section.

Cal. Public Resources Code - PRC § 75226. Section 75226.

(a) Notwithstanding any other law, moneys appropriated to the Transportation Agency in the annual Budget Act from the General Fund and the Greenhouse Gas Reduction Fund for purposes of the Transit and Intercity Rail Capital Program shall not be distributed pursuant to a program of projects adopted pursuant to Section 75222 and allocated by the California Transportation Commission pursuant to Section 75220. (b) The moneys described in subdivision (a) shall instead be distributed to regional transportation planning agencies pursuant to Section 99313 of the Public Utilities Code and the distribution of those moneys shall be subject to the requirements of Section 13987 of the Government Code and the guidelines adopted pursuant to that section. (c) Subject to compliance with Section 13987 of the Government Code, a regional transportation planning agency may use moneys described in subdivision (a) to fund transit operating expenses within its jurisdiction consistent with an approved regional short-term financial plan or a long-term financial plan, as applicable, or for transformative capital improvements described in Sections 75220 and 75221, or for both of these purposes. (d) In allowing the funds described in subdivision (a) to be available for operating costs, it is the intent of the Legislature for those expenditures to do all of the following: (1) Provide one-time multiyear bridge funding for transit operators to address operational costs until long-term transit sustainability solutions are identified. (2) Assist transit operators in preventing service cuts and increasing ridership. (3) Prioritize the availability of transit for riders who are transit dependent. (4) Prioritize transit agencies representing a significant percentage of the region’s ridership. (e) For purposes of this section, “regional transportation planning agency” means a recipient of funding described in paragraphs (1) and (2) of subdivision (a) of Section 99312.1 of the Public Utilities Code.

Cal. Public Resources Code - PRC § 75227. Section 75227.

(a) This section shall apply notwithstanding any other law. (b) For purposes of this section, the following definitions apply: (1) “Public transit operating purposes” includes, but is not limited to, costs necessary to avoid or mitigate service reductions and costs to maintain or restore existing transit service levels for bus, rail, and other public transportation services. “Public transit operating purposes” does not include capital construction costs or any other capital expenses. (2) “Region” means the region described in Section 66502 of the Government Code. (3) “Specified transit entities” means the San Francisco Bay Area Rapid Transit District, the San Francisco Municipal Transportation Agency, the Peninsula Corridor Joint Powers Board, and the Alameda-Contra Costa Transit District. (c) On or before July 1, 2026, the Transportation Agency shall loan to the Metropolitan Transportation Commission up to five hundred ninety million dollars ($590,000,000) of funding approved under the Transit and Intercity Rail Capital Program for projects within the region. The Metropolitan Transportation Commission shall use the proceeds of the loan described in this section to offer loans to the specified transit entities for public transit operating purposes. The loan to the Metropolitan Transportation Commission shall be subject to all of the following: (1) The loan is limited to being comprised of funding awarded to projects within the region that, as of December 31, 2025, have not been fully allocated funding by the California Transportation Commission. (2) The loan shall be repaid in quarterly installments by the Metropolitan Transportation Commission to the Transportation Agency over a period of 12 years calculated from the original loan issue date, subject to all of the following: (A) The first two years of the loan repayment period shall consist of interest-only quarterly payments. (B) After two years from the original loan issue date, repayment shall consist of quarterly payments based on an amortization schedule factoring in full repayment of both outstanding interest and principal amounts over the remaining loan term. (C) The rate of interest applied to a loan made pursuant to this section shall be the same rate earned on investments in the Surplus Money Investment Fund during the loan repayment period. (3) The Metropolitan Transportation Commission shall determine the terms and conditions of loans made to the specified transit entities, including, but not limited to, the principal amount, and any conditions before disbursement, consistent with the requirements of subparagraphs (A), (B), and (C) of paragraph (2). (d) (1) The Metropolitan Transportation Commission shall secure repayment of any loan issued by the Transportation Agency pursuant to this section by pledging and assigning, as security of last resort for the loan, the State Transit Assistance Program revenues received by the specified transit entities that would otherwise be administered by the Metropolitan Transportation Commission pursuant to Section 99314 of the Public Utilities Code. The loan agreement shall be signed by a representative of the Transportation Agency and the Metropolitan Transportation Commission and shall specify the pledged amount or method of calculation and the period during which the pledge applies. The signatories to the loan agreement may bind their respective agencies, as established by each agency’s respective procedures and any necessary supporting actions to confer that authority. (2) The California Transportation Commission shall monitor and report to the Transportation Agency on the unallocated and unexpended balances of the region’s project awards for the Transit and Intercity Rail Capital Program. If the total awarded but unallocated funds to projects in the region less any outstanding loan balances falls below three hundred fifty million dollars ($350,000,000), the California Transportation Commission shall do both of the following: (A) Notify the Transportation Agency and Metropolitan Transportation Commission. (B) In consultation with the Transportation Agency, evaluate information provided by the Metropolitan Transportation Commission and project sponsors in the region regarding their unallocated and unexpended balances of the region’s projects in the Transit and Intercity Rail Capital Program to determine whether there is risk to California Transportation Commission’s ability to meet the region’s anticipated allocation requests and project cash flow requirements over the next two years. If the California Transportation Commission, in consultation with the Transportation Agency, determines it to be necessary, the California Transportation Commission, in consultation with the Transportation Agency, shall establish an allocation plan for the region’s awarded projects, in coordination with the region’s Transit and Intercity Rail Capital Program project sponsors and the Metropolitan Transportation Commission. The allocation plan shall be for projects in the region seeking allocation and the plan may adjust or defer future allocations during the period of repayment of the loan made to the Metropolitan Transportation Commission pursuant to subdivision (c). (3) If an allocation plan established pursuant to paragraph (2) results in a material impact to a project in the region, as determined by the California Transportation Commission and the Transportation Agency, the Metropolitan Transportation Commission, in coordination with the Transportation Agency, may prioritize the use of existing sources of funds allocated by the state to the region so that the project is not materially impacted with regard to scope, schedule, and eligibility for nonstate funding. If state-allocated fund sources provided to the region are used for this circumstance, the Transportation Agency may return funds to the Metropolitan Transportation Commission from the loan repayments made pursuant to paragraph (2) of subdivision (c) equal to the state-allocated fund sources provided to the region that are committed to the affected project. (e) A specified transit entity shall use its respective share of funding under the State Transit Assistance Program pursuant to Section 99314 of the Public Utilities Code as security for any loan made by the Metropolitan Transportation Commission pursuant to this section and those funds may be redirected by the Metropolitan Transportation Commission as repayment for any outstanding loan if the specified transit entity fails to make timely loan payments. (f) (1) Subdivisions (a) to (e), inclusive, shall become inoperative upon full repayment of the loan by the Metropolitan Transportation Commission, as determined by the Transportation Agency in consultation with the Department of Finance. (2) Upon the determination made in paragraph (1), notwithstanding Section 9795 of the Government Code or any other law, the Transportation Agency shall notify the Joint Legislative Budget Committee of this fact. This section shall be repealed on January 1 following the notification provided to the Joint Legislative Budget Committee. (g) The Legislature finds and declares that this section is related to Section 91.00 of the Budget Act of 2025 (Chapters 4, 5, and 104 of the Statutes of 2025).

Source: CA Legislative Counsel Bulk DataURL: https://downloads.leginfo.legislature.ca.gov/pubinfo_2025.zipFetched: 6/27/2026