The Corcoran Report: Regional Transportation Funding
In early December, Governor Crist, Senate President Atwater and House Speaker Cretul announced a special session on Regional Transportation Funding. This special session was called to prepare the state of Florida to competitively seek federal stimulus funding for rail programs within the state.

After several days of discussion and debate, the Florida House and Senate passed legislation paving the way for serious consideration of passenger rail as a modal choice in Florida and creating a competitive opportunity to seek federal stimulus funding in this area. The bill was presented to Governor Crist and it is widely expected to be signed into law by the Governor.

The bill provides a statutory framework for enhancing the consideration of passenger rail as a modal choice in the development and operation of Florida's transportation network in the following ways:

• Creates the Statewide Passenger Rail Commission to serve in an advisory capacity to the Department of Transportation (DOT) and the Legislature concerning passenger rail issues in Florida.

• Creates the Florida Rail Enterprise within the DOT to oversee the development and operation of state-owned passenger rail systems, including high speed rail. Many of the functions of the current High Speed Rail Authority are assigned to the Enterprise, and the High Speed Rail Authority is essentially replaced by the Enterprise.

• Establishes a dedicated source of funding for future state-owned passenger rail systems by allocating the first $60 million of documentary stamp tax proceeds going to the Transportation Regional Incentive Program to the Florida Rail Enterprise. This reallocation will begin July 1, 2014 to avoid disruption to the current five-year transportation work program.

• Provides $13 million to $15 million annually from transportation revenues in addition to the current funding provided by DOT to the South Florida Regional Transit Authority.

• Revises the ability to use capital dollars to fund the operations of Tri-Rail.

• Authorizes the DOT to fund up to 100 percent of the operating costs of future state-owned passenger rail systems for a period not to exceed seven years.

• Establishes the framework for the allocation and assumption of risks associated with state-owned passenger rail corridors, and authorizes DOT to purchase insurance and establish a self-retention fund to insure against liability risks associated with state-owned passenger rail corridors.

• Authorizes DOT to complete an escrowed closing on the Central Florida Rail Corridor (SunRail) acquisition; however the drawdown of the escrowed closing cannot occur until the Federal Transit Administration's full-funding grant agreement is in place.

• Requires DOT to work with affected local communities along an impacted freight rail corridor to identify and address the impacts associated with an increase in freight traffic due to implementation of state-owned passenger rail systems.

• Beginning July 1, 2014, the bill increases the allocation of documentary stamp tax proceeds going to the Small County Outreach program from 5 to 10 percent. These funds may be used for any eligible transportation projects.

• Fiscal impacts of the bill will be funded through the reallocation of existing transportation revenues and the increased revenues to the State Transportation Trust Fund projected by the November 2009 Transportation Revenue Estimating Conference. Projects within the existing five-year work program will not be affected by this bill.

Current law requires each of the three counties in the Tri-Rail service area (Palm Beach, Broward and Miami-Dade) to contribute $2.67 million every year to fund Tri-Rail, plus an additional $1.565 million for operating expenses. The bill continues to require these local revenues, and clarifies that the $2.67 million annually provided by the counties may be used for capital, operations, and maintenance.

In its negotiations with CSX for SunRail, DOT renegotiated the terms of the South Florida Operating and Maintenance Agreement (SFOMA) to establish full operations control of the South Florida Rail Corridor by SFRTA. This agreement increases the charges assessed to CSX for freight use within the corridor, while giving control of all the operations and maintenance of the corridor to SFRTA.

The bill requires DOT, effective July 1, 2010, to transfer from the STTF, the following amounts to SFRTA:

• If SFRTA becomes responsible for operating, maintaining, and dispatching the rail corridor, $15 million for operations, maintenance, and dispatch and an amount no less than DOT's commitments for fiscal year 2010-2011, as of July 1, 2009, for operating assistance, corridor track maintenance, and contract maintenance.

• If SFRTA does not become responsible for operating, maintaining, and dispatching the rail corridor, $13.3 million for operations, maintenance, and dispatch and an amount no less than DOT's commitments for fiscal year 2010-2011, as of July 1, 2009, for operating assistance, corridor track maintenance, and contract maintenance.

The bill provides that the additional funds provided to the SFRTA shall be allocated from the first proceeds of the increased revenues to be deposited into the State Transportation Trust Fund estimated by the November 2009 Transportation Revenue Estimating Conference. Specifically, the bill ensures the transfer of such funds shall not negatively impact projects included in the fiscal years 2009-2010 through 2013-2014 transportation work program.

• Minimum 15 percent to Public Transportation Projects (s. 206.46(3), F.S.)

• Minimum 1.5 percent for Highway Beautification Projects (s. 334.044(26), F.S.)

• District Statutory Formula based on 50 percent population and 50 percent fuel tax collections (s.339.135(4)(a)1., F.S.)

• Minimum 50 percent for the Strategic Intermodal System (s. 339.135(4)(a)2., F.S.)

The bill provides that these dedicated funds to the SFRTA may not be provided from the documentary stamp tax distribution to the Florida Rail Enterprise for rail programs.

We are continuing to monitor legislation specific to the public notice issue, important to CPF member papers. Additionally, we continue to monitor and report on other issues which will be considered during the coming regular legislative session.

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Meanwhile, from our firm to you, we wish you a safe and happy holiday season and a prosperous and joyous new year.

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