Sometimes certain issues are just ripe for reform.

California’s desperate need for funding to pay for long-ignored infrastructure has now reached that point. The governor and state legislative leaders, business and labor groups, environmentalists and builders — and yes, local officials too — are all singing from the same book.

After years of terrible neglect, our bridges and roads, parks, schools and libraries and other essential infrastructure may see a significant influx of funding before the end of this year.

Senate President Pro Tem Don Perata made the first call for a major infrastructure bond last year, when he introduced SB 1024. In early January, Assembly Speaker Fabian Nunez introduced the outline of his proposal in AB 1783. And in his annual State of the State address, Governor Schwarzenegger unveiled his own plan to address our ailing infrastructure.

Clearly, there is broad consensus to “Build it!” as the governor said in his speech. It’s likely that the three leaders will sit down and negotiate a final plan that could be put before the voters as early as June 2006.

All of this is very, very good news for California cities. Roughly 80 percent of California’s 36 million people live in one of the state’s 478 cities. Each year, as the state experiences net population growth of 600,000, our cities struggle to keep up with the ever-increasing need for new and improved roads, transit systems, affordable housing, parks, schools and libraries.

That’s why, as the League focuses on “safe and healthy cities” in 2006, a top priority is working to expand funding for state and local investment in the physical infrastructure of California. This includes roadways, bridges, levees, parks, libraries, and systems for delivering and treating water, wastewater and stormwater.

Local Infrastructure Is Key to State’s Success

Local governments have an important message for our state leaders as they negotiate the size and extent of an infrastructure package: California cannot be a success unless our cities are also a success. Because we first need healthy cities if we want to have a healthy state, ongoing increased funding for local infrastructure must be a state priority.

For example, if our urban areas cannot accommodate additional population — or if they lose population due to deteriorating conditions — the state will face increasing pressure to expand development into rural areas currently used for farmland, recreation and open space. The long commutes and imbalance of jobs and housing will continue.

Local governments need help from the state to meet the infrastructure demands of California’s rapidly growing population. Faced with severe limits on revenue raising at the local level, many local governments are concerned they are simply losing the battle to provide adequate infrastructure and services for their communities.

Years of underfunded maintenance work — in part resulting from the $6 billion, multi-year state take-away of local funds through the ERAF property tax shift — left many cities with insufficient revenues to pay for even routine maintenance projects. The consequences of years of deferred street and road maintenance are most evident in older cities. But even newer communities are challenged to find the funds necessary to keep up with the demands of a growing population for streets, parks, libraries, flood control, water delivery and other essential infrastructure.

Our residents see this problem every day, and their frustration with inadequate infrastructure undermines our ability to build new housing the state so urgently needs. When current residents are already living with potholes in the roads and poorly maintained parks, they have every reason to oppose new housing that would increase traffic or overcrowd a park.

Basics of a State-Local Partnership

What do cities need to be successful partners with the state?

First, local governments need reliable, on-going funding to pay for transportation, including maintenance of local streets and roads. A good start would be to ensure that Proposition 42 funding — the sales tax on gasoline that voters earmarked for transportation in 2002 — is fully protected from being shifted to the state general fund in the future. Ending the state’s ability to borrow these funds would establish a pipeline of dedicated revenues that both the state and local governments could rely on to fund current and future transportation infrastructure projects.

It’s also important to cities and counties that the state repays the $2.3 billion it borrowed from Prop. 42 monies in FYs 2003–04 and 2004–05. Senator Perata has included this repayment in his SB 1024, and we thank him for that.

Another concern is the Prop. 42 “funding gap” — a complete zeroing out of Prop. 42 funds for cities and counties in FYs 2006–07 and 2007–08, currently spelled out in state law, to “balance out” funds that were provided to cities and counties before Prop. 42 was enacted.

We think a two-year gap in funding is counter-productive. Why interrupt the progress that just began this year, when Prop. 42 was fully funded for the first time since the voters passed the measure in 2002?

Consider the City of South Gate, which estimates that the total cost of rehabilitating its streets and alleys is about $60 million. South Gate’s analysis indicates that it needs about $3 million per year to maintain the public right-of-way, but has so far only been able to allocate $700,000.

Or consider the City of San Bernardino, which estimates it needs $75 million to bring city streets up to a minimally acceptable condition — but so far has only received about $800,000 in Prop. 42 funds.

We ask our state leaders to remember that cities and counties are responsible for 82 percent of California’s maintained miles. They maintain the overall road systems between jurisdictions and the state highways, including the secondary highway system where most vehicle trips begin and end. Many local streets are also regionally significant arteries. There is a reason they’re called arteries — they are the lifeblood of our cities and economy. If they fail, everything comes to an abrupt halt.

Traffic arteries at the city level provide access to other jurisdictions and are often used as alternative routes, especially when the freeway system is clogged. Insufficient funding to cities means miles and miles of these arteries will not be maintained.

Yet with these responsibilities, cities and counties have a $13 billion backlog in road and bridge rehabilitation projects. If a predictable revenue stream is not available, these local roadways will continue to deteriorate to the point where they have to be rebuilt.

The cost to properly maintain a roadway is a fraction of the cost to rebuild it. Preventive maintenance of streets costs about $1.30/square yard; replacing the street costs $28.20/square yard. Insufficient funding means miles and miles of neglected streets and roads will not be rehabilitated. If road maintenance is deferred, it becomes a question of “pay now, or pay much, much more later.”

So a good start to tackling local governments’ need for transportation funding would be to fully fund Prop. 42, protect the funds from future shifts and avoid gaps in funding.

But cities’ and counties’ infrastructure needs go beyond Prop. 42 and transportation.

More Than Transportation Is Needed

State leaders are also interested in a bond to pay for trade corridors and ports, flood control, providing incentives for infill development and other projects. We welcome these approaches.

But while an initial bond is a good “kick start” to address these problems, we believe that if California is going to retain its economic competitiveness and quality of life, we need an ongoing solution to ourinfrastructure problems, with new funding proposals to make a real difference in shaping the way we grow as a state.

Therefore, a state infrastructure package should also contain more significant investments specifically addressing an array of infill issues (water, sewer, urban parks, as well as streets and other needs). Funding these needs will allow cities to accommodate higher density housing in locations that complement transit investments. It is also critical to obtain major investment in affordable housing funds targeted primarily in these same locations.

Cities also need more tools and resources at the local level to get the job done. The following changes would help:

• Provide local governments with an opportunity to match state infrastructure and affordable housing investments with a 55 percent vote (the same threshold as schools);
• Allow local governments to form 100 high-density housing infrastructure investment zones throughout the state; and
• Encourage and reward communities that develop affordable housing trust funds by matching local contributions to these trust funds with a dollar-for-dollar return of ERAF property tax dollars.

Together We Can Accomplish Great Things

Investments in infrastructure and our cities are essential to our efforts to build a safe and healthy California. With 80 percent of Californians living in cities, it is clear that we provide the services — and yes, the infrastructure — that make a difference in their lives. If provided with appropriate resources, we can deliver the necessary services to improve the quality of life in all of our communities.

We appreciate the leadership of the governor and legislators on this issue. We stand ready to work with them to accomplish great things for California’s infrastructure in 2006.

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This article appears in the February 2006 issue of Western City
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