AMENDED IN SENATE MARCH 14, 2011

california legislature—2011–12 regular session

ASSEMBLY BILL No. 105

Introduced by Committee on Budget (Blumenfield (Chair), Alejo,

Allen, Brownley, Buchanan, Butler, Cedillo, Chesbro, Dickinson,
Feuer, Gordon, Huffman, Mitchell, Monning, and Swanson)

January 10, 2011

An act relating to the Budget Act of 2011. An act to repeal and add
Section 41204.2 of the Education Code, to amend Sections 8879.52,
8879.61, 8879.65, 14556.7, and 16965 of the Government Code, to
amend Sections 99312, 99315, and 185024 of, and to add Sections
99312.1 and 99312.2 to, the Public Utilities Code, to repeal Section
7102.1 of, and to repeal and add Sections 6051.8, 6201.8, 6357.3,
6357.7, 6480.1, 7360, 7361.1, 7653.1, and 60050 of, the Revenue and
Taxation Code, to amend Sections 167, 183.1, and 2103 of, and to add
Section 183.2 to, the Streets and Highways Code, and to amend Sections
1661, 4601, 5902.5, 9552, and 12811 of, and to add Section 9400.4 to,
the Vehicle Code, relating to transportation, making an appropriation
therefor, and declaring the urgency thereof, to take effect immediately.

legislative counsel’s digest

AB 105, as amended, Committee on Budget. Budget Act of 2011.
Transportation.
(1)  Existing law provides for payment of current general obligation
bond debt service for specified voter-approved transportation bonds
from gasoline excise tax revenue in the Highway Users Tax Account
and revenue in the Public Transportation Account, and requires the
Controller to make specified transfers of revenues in that regard to the
Transportation Debt Service Fund. Existing law, pursuant to the Budget

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Act of 2010, provides for a loan of $761,639,000 from gasoline excise

tax revenue in the Highway Users Tax Account to the General Fund,
to be repaid with interest by June 30, 2013.
Proposition 22, approved by the voters on November 2, 2010, amends
the California Constitution to, among other things, impose new
restrictions on the use of fuel excise tax revenues allocated to the state
and revenues deposited in the Public Transportation Account.
This bill, in fiscal years 2010–11 and 2011–12, would require the
Controller to transfer specified amounts of revenues deposited in the
State Highway Account from vehicle weight fees to the Transportation
Debt Service Fund to be used for reimbursement of the General Fund
for payment of current general obligation bond debt service for specified
voter-approved transportation bonds, in lieu of the previously authorized
gasoline excise tax revenues and Public Transportation Account
revenues. In subsequent years, the bill would require all vehicle weight
fee revenues to be transferred for this purpose. The bill would make
appropriations in this regard. The bill would require the Department
of Finance to notify the Controller of the amount of debt service relating
to expenditures for eligible mass transit guideway projects that may be
paid from revenues restricted by Article XIX of the California
Constitution.
This bill, in fiscal year 2010–11, would require the Controller to
transfer specified amounts of revenues deposited in the State Highway
Account from vehicle weight fees to the General Fund as a loan, in lieu
of the previously authorized loan of gasoline excise tax revenues. The
loan amount for 2010–11 would be repaid over 3 years beginning on
June 30, 2014. The bill would also authorize an additional loan in fiscal
year 2011–12 of specified vehicle weight fee revenues, to be repaid by
June 30, 2015. The bill would make appropriations in this regard.
This bill would require the Controller to take various other
conforming actions as of November 2, 2010, due to voter approval of
Proposition 22 and to the extent the Controller has previously taken
actions inconsistent with the requirements imposed by this bill.
(2)  Existing law, in the 2011–12 fiscal year, requires certain revenues
deposited in the State Highway Account that are not restricted as to
expenditure by Article XIX of the California Constitution to be
transferred to the Transportation Debt Service Fund for payment of
current year debt service on certain mass transportation bonds.
Thereafter, these revenues are to be transferred to the Public
Transportation Account.

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This bill would, instead, transfer these revenues to the Transportation

Debt Service Fund for payment of current year debt service on certain
mass transportation bonds in the 2011–12 and 2012–13 fiscal years.
Beginning in 2013–14, these revenues would be retained in the State
Highway Account until appropriated by the Legislature.
(3)  Proposition 26, approved by the voters on November 2, 2010,
amends the California Constitution to, among other things, require a
2
⁄3 vote of both houses of the Legislature for any change in statute that
results in any taxpayer paying a higher tax. Proposition 26 also provides
that any tax adopted after January 1, 2010, but prior to November 3,
2010, that was not adopted in compliance with the 2⁄3 vote requirement
shall be void on November 3, 2011, unless the tax in reenacted by the
Legislature with a 2⁄3 vote.
Existing law, as of July 1, 2010, eliminates the state sales and use
tax on motor vehicle fuel (gasoline) and increases the excise tax.
Existing law, as of July 1, 2011, increases the sales and use tax on
diesel and decreases the excise tax. Existing law requires the State
Board of Equalization to annually modify both the gasoline and diesel
excise tax rates on a going-forward basis so that the various changes
in the taxes imposed on gasoline and diesel, as described above, are
revenue neutral. Existing law enacts other provisions related to the
implementation of these provisions.
This bill would repeal all of these provisions. The bill would enact
new, similar replacement provisions, and state the intent of the
Legislature that the changes are being made in order to comply with
Proposition 26. The bill would also increase the new diesel sales and
use tax rates to be applicable in fiscal years 2011–12, 2012–13, and
2013–14 above the rates currently in effect that the bill would repeal.
These increases in the diesel sales and use tax rates would be offset by
a reduction in the diesel excise tax rate as of July 1, 2011, and a
requirement for the State Board of Equalization to adjust diesel excise
tax rates on a going-forward basis to ensure that the overall changes
in these diesel fuel taxes are revenue neutral.
(4)  Existing statutory law provides that 75% of diesel sales tax
revenues at the 4 ¾% rate are to be allocated by the Controller from
the Public Transportation Account to local agencies for public
transportation purposes pursuant to the State Transit Assistance
Program, with the remaining 25% of revenues to made available for
mass transit programs at the state level. Proposition 22, approved by
the voters on November 2, 2010, amends the California Constitution

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to require these Public Transportation Account revenues to be divided

equally between the State Transit Assistance Program and the state-level
programs.
This bill would conform the statutory provisions to the requirements
of Proposition 22. The bill would appropriate $23 million to the
Controller from the Public Transportation Account in the 2011–12
fiscal year for allocation to the State Transit Assistance Program. The
bill would also continuously appropriate all of the diesel sales revenues
above the 4 ¾% rate to the Controller for allocation to that program.
(5)  Existing law provides for a loan of $135,000,000 from the State
Highway Account to the General Fund that is to be repaid by June 30,
2012.
This bill would instead require that loan to be repaid by June 30,
2013.
(6)  Existing law, until July 1, 2011, authorizes the Department of
Transportation to transfer funds as short-term loans between various
transportation accounts.
This bill would extend the operation of these provisions until July 1,
2014. The bill would also eliminate the authority of the department to
transfer funds as short-term loans to and from the Transportation
Investment Fund, the Transportation Deferred Investment Fund, and
the Public Transportation Account.
(7)  Existing law creates the California Transportation Commission,
with various duties and responsibilities relative to the programming
and allocation of funds for transportation capital projects. Existing law
requires the commission to submit, by December 15 of each year, an
annual report to the Legislature summarizing the commission’s
prior-year decisions in allocating transportation capital funds and
identifying timely and relevant transportation issues facing the state.
Existing law, the Highway Safety, Traffic Reduction, Air Quality, and
Port Security Bond Act of 2006, authorizes the issuance of $19.25 billion
of general obligation bonds for specified purposes, including $2 billion
to be transferred to the Trade Corridors Improvement Fund to be
available, upon appropriation in the annual Budget Act by the
Legislature and subject to such conditions and criteria as the Legislature
may provide by statute, for allocation by the commission. Existing law
requires the Department of Transportation to, on or before February
18, 2009, report to specified committees of the Legislature a summary
of any memorandum of understanding or any other agreement executed
between a railroad company and any state or local transportation

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agency relative to any project funded with moneys allocated from the
Trade Corridors Improvement Fund.
This bill would instead require the commission to provide that report
to specified committees of the Legislature within 30 days of receiving
such a memorandum of understanding or executed agreement. The bill
would also, commencing January 1, 2012, require the commission to
provide semiannual reports to those committees on the status of all
railroad projects programmed in the Trade Corridors Improvement
Fund program. The bill would make these reporting requirements
inoperative on January 1, 2015.
(8)  The Highway Safety, Traffic Reduction, Air Quality, and Port
Security Bond Act of 2006 also requires that $1,000,000,000 of bond
funds be deposited in the Transit System Safety, Security, and Disaster
Response Account, administered by the California Emergency
Management Agency (Cal EMA), for capital projects that provide
increased protection against a security and safety threat, and for capital
expenditures to increase the capacity of transit operators to develop
disaster response transportation systems, as specified. Existing law
requires 25% of available funds to be allocated to certain regional
public waterborne transit agencies. Existing law requires entities
receiving funds from that account to expend those funds within 3 fiscal
years of the fiscal year in which the funds were allocated and requires
that funds remaining unexpended after those 3 years revert to Cal EMA
for reallocation in subsequent fiscal years.
This bill, notwithstanding these provisions, would provide that entities
receiving an allocation of the funds set aside for regional public
waterborne transit agencies, relative to allocations of funds made prior
to June 30, 2011, shall have 4 fiscal years from the last day of the fiscal
year in which the funds were received by that entity to expend those
funds.
(9)  Existing law requires funds from the Local Street and Road
Improvement, Congestion Relief, and Traffic Safety Account of 2006
to be made available to the Controller for allocation to cities, counties,
and a city and county, for purposes of the Highway Safety, Traffic
Reduction, Air Quality, and Port Security Bond Act of 2006, as specified.
Upon receipt of funds, a city, county, or city and county is required to
expend those funds within 3 fiscal years from the date that the funds
are allocated to it by the Controller, and any funds not expended within
that period are required to be returned to the Controller and reallocated
to other cities, counties, or a city and county, as specified.

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Existing law establishes the Highway Users Tax Account in the

Transportation Tax Fund with revenues in the account restricted to
expenditure on various purposes, including public street and highway
purposes and certain mass transit guideway purposes.
This bill would authorize a city, county, or city and county that
receives these funds in a fiscal year in which funds from the Highway
Users Tax Account are deferred, suspended, borrowed, or shifted, to
expend those funds within 4 fiscal years from the last date of the fiscal
year in which the funds are allocated to it by the Controller.
(10)  Existing law, the California High-Speed Rail Act, creates the
High-Speed Rail Authority to develop and implement a high-speed rail
system in the state, with specified powers and duties. Existing law
provides for appointment of an executive director by the authority, who
is exempt from civil service and serves at the pleasure of the authority.
Existing law requires the executive director to be paid a salary
established by the authority and approved by the Department of
Personnel Administration.
This bill, for purposes of managing and administering the ongoing
work of the authority in implementing the high-speed train project,
would authorize the Governor, upon the recommendation of the
executive director, to appoint up to 6 additional individuals, exempt
from civil service, who would serve in specified positions at the pleasure
of the executive director. The bill would require a salary survey to be
conducted to determine the compensation for the executive director and
additional exempt persons, and would require the salaries to be
established by the authority and approved by the Department of
Personnel Administration.
This bill would impose certain reporting requirements on the authority
with respect to a portion of funds appropriated to the authority in the
2010 and 2011 Budget Acts, to be submitted to the Joint Legislative
Budget Committee.
(11)  Existing law provides that the Department of Transportation
has full possession and control of the state highway system. Existing
law creates various programs to fund transportation capital
improvement programs and provides for allocation of those funds.
Existing law requires the department to prepare an annual budget, as
specified, for submission to the Governor.
This bill would require the department to submit specified
supplemental information by May 1 of each year to the Legislative
Analyst and to the Senate Committee on Appropriations and the

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Assembly Committee on Appropriations to substantiate the department’s

proposed capital outlay support budget.
(12)  Existing law provides for apportionment by the Controller of a
specified amount of gasoline excise tax revenues in the Highway Users
Tax Account to cities and counties for local street and road purposes,
including revenues from the increase in the gasoline excise tax, pursuant
to Chapters 11 and 12 of the 8th Extraordinary Session of the Statutes
of 2010. These revenues, including the revenues from the increase in
the gasoline excise tax, are not subject to expenditure requirements and
restrictions that were applicable to revenues from the gasoline sales
tax that was repealed by the above-referenced legislation.
This bill would clarify that the revenues apportioned to cities and
counties from the increase in the gasoline excise tax may be used for
any local street and road purpose and are not subject to the
requirements and restrictions applicable to the former gasoline sales
tax revenues.
(13)  Existing law establishes fees for original and renewal
registration of vehicles to be collected by the Department of Motor
Vehicles. Existing law requires the department, with a specified
exception, to notify the registered owner of each vehicle of the date that
registration renewal fees for the vehicle are due, at least 60 days prior
to that due date, and to indicate the fact that the required notice was
mailed by a notation in the department’s records.
This bill would, commencing on June 8, 2011, and operative until
January 1, 2012, reduce the department’s time period for notification
that vehicle registration renewal fees are due to 30 days prior to the
due date.
(14)  Existing law requires that the renewal of registration for a
vehicle that is either currently registered or for which a specified
certification is filed be obtained not more than 75 days prior to the
expiration of the current registration or certification.
This bill would, commencing on June 8, 2011, and operative until
July 1, 2011, instead apply the above-specified requirement only to the
renewal of registration for any vehicle that expires on or before June
30, 2011, and would require the renewal of registration for a vehicle
that expires on or after July 1, 2011, or for which a specified
certification is filed, to be obtained not more than 15 days prior to the
expiration of the current registration or certification.
(15)  Existing law requires that if an application for a registration
transaction is filed with the Department of Motor Vehicles during the

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30 days immediately preceding the date of expiration of registration of

the vehicle, the application be accompanied by the full renewal fees for
the ensuing registration year in addition to any other fees that are due
and payable.
This bill would, commencing on the date that this bill becomes
operative and remaining operative until July 1, 2011, reduce the time
period to 10 days immediately preceding the date of expiration of
registration of the vehicle.
(16)  Existing law provides that fees are delinquent if an application
for renewal of registration, or an application for renewal of special
license plates, is made after midnight of the expiration date of the
registration or special plates, or 60 days after the date the registered
owner is notified by the Department of Motor Vehicles, whichever is
later.
This bill would, commencing on June 8, 2011, and operative until
January 1, 2012, reduce the time period to 30 days after the date the
registered owner is notified by the department.
(17)  Under existing law, when the Department of Motor Vehicles
determines that an applicant is lawfully entitled to a driver’s license,
the department is required to issue that license to the applicant. Existing
law specifies the contents of a driver’s license. Existing law requires
that the front of an application for an original or renewal of a driver’s
license or identification card contain a space for an applicant to give
his or her consent to be an organ and tissue donor upon death.
This bill would also require the application for a driver’s license or
identification card to contain a space for an applicant to indicate
whether he or she has served in the Armed Forces of the United States
and to give his or her consent to be contacted regarding eligibility to
receive state or federal veterans benefits. The bill would require the
Department of Motor Vehicles to electronically transmit to the
Department of Veterans Affairs specified information on an applicant
who has identified on his or her application for a driver’s license or
identification card that he or she has served in the Armed Forces of the
United States and consents to being contacted about veterans benefits.
(18)  The bill would enact other related provisions.
The California Constitution authorizes the Governor to declare a
fiscal emergency and to call the Legislature into special session for
that purpose. Governor Schwarzenegger issued a proclamation
declaring a fiscal emergency, and calling a special session for this
purpose, on December 6, 2010. Governor Brown issued a proclamation

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on January 20, 2011, declaring and reaffirming that a fiscal emergency

exists and stating that his proclamation supersedes the earlier
proclamation for purposes of that constitutional provision.
This bill would state that it addresses the fiscal emergency declared
and reaffirmed by the Governor by proclamation issued on January
20, 2011, pursuant to the California Constitution.
(19)  This bill would declare that it is to take effect immediately as
an urgency statute.
This bill would express the intent of the Legislature to enact statutory
changes relating to the Budget Act of 2011.
Vote: majority 2⁄3. Appropriation: no yes. Fiscal committee: no
yes. State-mandated local program: no.

The people of the State of California do enact as follows:

1 SECTION 1. It is the intent of the Legislature to reenact the

2 “fuel tax swap,” as originally enacted by Assembly Bill 6 of the
3 2009–10 Eighth Extraordinary Session and subsequently modified
4 by Senate Bill 70 of the 2009–10 Regular Session, and as further
5 modified herein, with a two-thirds vote of each house of the
6 Legislature pursuant to the requirements of Proposition 26, as
7 approved by the voters at the November 2, 2010, statewide General
8 Election.
9 SEC. 2. Section 41204.2 of the Education Code is repealed.
10 41204.2. The Director of Finance shall adjust “the percentage
11 of General Fund revenues appropriated for school districts and
12 community college districts, respectively, in fiscal year 1986–87”
13 for purposes of applying paragraph (1) of subdivision (b) of Section
14 8 of Article XVI of the California Constitution in a manner that
15 ensures that the shift in General Fund revenues pursuant to Sections
16 6051.8, 6201.8, 6357.7, and 7361.1, subdivision (b) of Section
17 7360, and subdivision (b) of Section 60050 of the Revenue and
18 Taxation Code, as those provisions were enacted in the 2009–10
19 Eighth Extraordinary Session, shall have no net fiscal impact upon
20 the amounts that are otherwise required to be applied by the state
21 for the support of school districts and community college districts
22 pursuant to Section 8 of Article XVI of the California Constitution.
23 SEC. 3. Section 41204.2 is added to the Education Code, to
24 read:

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1 41204.2. The Director of Finance shall adjust “the percentage

2 of General Fund revenues appropriated for school districts and
3 community college districts, respectively, in fiscal year 1986–87”
4 for purposes of applying paragraph (1) of subdivision (b) of Section
5 8 of Article XVI of the California Constitution in a manner that
6 ensures that the shift in General Fund revenues, pursuant to
7 Sections 6051.8, 6201.8, 6357.7, and 7361.1, subdivision (b) of
8 Section 7360, and subdivision (b) of Section 60050 of the Revenue
9 and Taxation Code, as those provisions were enacted in the
10 2009–10 Eighth Extraordinary Session and 2009–10 Regular
11 Session, and reenacted in the 2011–12 Regular Session, shall have
12 no net fiscal impact upon the amounts that are otherwise required
13 to be applied by the state for the support of school districts and
14 community college districts pursuant to Section 8 of Article XVI
15 of the California Constitution.
16 SEC. 4. Section 8879.52 of the Government Code is amended
17 to read:
18 8879.52. (a)  The commission shall evaluate, consistent with
19 the commission’s Trade Corridors Improvement Fund (TCIF)
20 Guidelines, adopted November 27, 2007, as part of the 2010 TCIF
21 review, the total potential costs and total potential economic and
22 noneconomic benefits of the program to California’s economy,
23 environment, and public health. The commission shall consult with
24 the State Air Resources Board in order to utilize the appropriate
25 models, techniques, and methods to develop the evaluation required
26 by this subdivision.
27 (b)  With respect to the two billion dollars ($2,000,000,000)
28 appropriated from the TCIF, as described in paragraph (1) of
29 subdivision (c) of Section 8879.23, and the five hundred million
30 dollars ($500,000,000) to be made available from the State
31 Highway Account, the following programming schedule shall
32 apply:
33 (1)  The Los Angeles/Inland Empire Corridor shall receive a
34 minimum of one billion five hundred million dollars
35 ($1,500,000,000).
36 (2)  The San Diego/International Border Corridor shall receive
37 a minimum of two hundred fifty million dollars ($250,000,000).
38 (3)  The San Francisco Bay/Central Valley Corridor shall receive
39 a minimum of six hundred forty million dollars ($640,000,000).

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1 (4)  Other corridors, as determined by the commission, shall

2 receive a minimum of sixty million dollars ($60,000,000).
3 (c)  The corridors referenced in subdivision (b) shall receive the
4 minimum amount of funding programmed for that corridor
5 notwithstanding the deprogramming of any project or projects in
6 that corridor by the commission. If a project is or projects are
7 deprogrammed, the commission shall collaborate with the local
8 transportation agencies in that corridor to select another project or
9 projects for programming of those funds within the minimum
10 amount provided to each corridor pursuant to subdivision (b).
11 (d)  If the Colton Crossing project programmed in the
12 commission’s TCIF Program as of April 10, 2008, does not meet
13 the requirements or delivery schedule contained in its project
14 baseline agreement when reviewed by the commission no later
15 than March 2010, the project shall be ineligible to receive an
16 allocation from the TCIF. The ninety-seven million dollars
17 ($97,000,000) associated with the project shall then be available
18 for programming in the Los Angeles/Inland Empire Corridor. In
19 that event, the commission shall collaborate with the local
20 transportation agencies in that corridor to select another project or
21 projects for programming of those funds, and, in making that
22 selection, shall take into consideration the Los Angeles/Inland
23 Empire Corridor Tier One or Tier Two Project Lists and any other
24 project identified by the local agencies. Projects currently receiving
25 TCIF funding shall not be considered for selection.
26 (e)  On or before February 18, 2009, the department shall report
27 to the policy committees of each house of the Legislature with
28 jurisdiction over transportation matters, a summary of any
29 memorandum of understanding or any other agreement executed
30 between a railroad company and any state or local transportation
31 agency as it relates to any project funded with moneys allocated
32 from the TCIF.
33 (e)  (1)  The commission shall report to the Assembly Committee
34 on Transportation, the Senate Committee on Transportation and
35 Housing, the Senate Committee on Budget and Fiscal Review, the
36 Assembly Committee on Budget, the Senate Committee on
37 Appropriations, and the Assembly Committee on Appropriations
38 a summary of any memorandum of understanding, along with a
39 copy of the memorandum, or any agreement executed between a
40 railroad company and any state or local transportation agency as

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1 it relates to any project funded with moneys allocated from the

2 TCIF within 30 days of the commission’s receipt of those
3 documents.
4 (2)  Commencing January 1, 2012, the commission shall provide
5 semiannual reports to the Assembly Committee on Transportation,
6 the Senate Committee on Transportation and Housing, the Senate
7 Committee on Budget and Fiscal Review, the Assembly Committee
8 on Budget, the Senate Committee on Appropriations, and the
9 Assembly Committee on Appropriations on the status of all railroad
10 projects programmed in the TCIF program.
11 (3)  This subdivision shall become inoperative on January 1,
12 2015, pursuant to Section 10231.5.
13 SEC. 5. Section 8879.61 of the Government Code is amended
14 to read:
15 8879.61. (a)  (1)  Entities described in subdivisions (a), (b),
16 and (c) of Section 8879.57 receiving an allocation of funds pursuant
17 to this article shall expend those funds within three fiscal years of
18 the fiscal year in which the funds were allocated. Funds remaining
19 unexpended thereafter shall revert to the California Emergency
20 Management Agency, as applicable, for reallocation under this
21 article in subsequent fiscal years.
22 (2)  Notwithstanding paragraph (1), for an allocation of funds
23 made prior to June 30, 2011, to an entity described in subdivision
24 (b) of Section 8879.57, that entity shall have four fiscal years from
25 the last day of the fiscal year in which the funds were received by
26 that entity to expend those funds.
27 (b)  Entities that receive grant awards from funds allocated
28 pursuant to subdivisions (b) or (c) of Section 8879.57 are not
29 eligible to receive awards from the funds allocated pursuant to
30 subdivision (a) of Section 8879.57.
31 (c)  Funds appropriated for the program established by this article
32 in the Budget Act of 2007 shall be allocated consistent with the
33 allocation schedule established in Section 8879.57.
34 SEC. 6. Section 8879.65 of the Government Code is amended
35 to read:
36 8879.65. (a)  Funds appropriated from the Local Street and
37 Road Improvement, Congestion Relief, and Traffic Safety Account
38 of 2006, established by subdivision (l) of Section 8879.23, shall
39 be made available to the Controller for allocation to cities, counties,
40 and a city and county. From bond funds appropriated in the

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1 2007–08 fiscal year for cities, including a city and county, each
2 city, and city and county, shall receive at least a minimum
3 allocation of four hundred thousand dollars ($400,000), as
4 described in subparagraph (B) of paragraph (1) of subdivision (l)
5 of Section 8879.23. The remainder of the funds appropriated for
6 cities, including a city and county, shall be allocated in the
7 proportion described in subparagraph (B) of paragraph (1) of
8 subdivision (l) of Section 8879.23. In no case shall a city, or a city
9 and county, receive an allocation in excess of its total share, as
10 described in subdivision (l) of Section 8879.23, except as described
11 in subdivision (d).
12 (b)  Prior to receiving an allocation of funds from the Controller
13 in a fiscal year, an eligible local agency shall submit to the
14 Department of Finance a list of projects expected to be funded
15 with bond funds pursuant to an adopted city, county, or city and
16 county budget. All projects proposed to be funded with funds from
17 the account shall be included in a city, county, or city and county
18 budget that is adopted by the applicable city council or board of
19 supervisors at a regular public meeting. The list of projects
20 expected to be funded with bond funds shall include a description
21 and the location of the proposed project, a proposed schedule for
22 the project’s completion, and the estimated useful life of the
23 improvement. The project list shall not limit the flexibility of an
24 eligible local agency to fund projects in accordance with local
25 needs and priorities so long as the projects are consistent with
26 subparagraph (B) of paragraph (1) of subdivision (l) of Section
27 8879.23.
28 (1)  The Department of Finance shall report monthly to the
29 Controller the eligible local agencies that have submitted a list of
30 projects as described in this subdivision.
31 (2)  Upon receipt of the information described in paragraph (1),
32 the Controller shall allocate funds to those agencies that have
33 submitted a list of projects, as reported by the Department of
34 Finance.
35 (c)  Each fiscal year upon expending funds from the account, a
36 city, county, or city and county shall submit documentation to the
37 Department of Finance which includes a description and location
38 of each completed project, the amount of funds expended on the
39 project, the completion date, and the project’s estimated useful
40 life. The documentation shall be forwarded to the department, in

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1 a manner and form approved by the department, at the end of each

2 fiscal year until the funds in the account are exhausted. The
3 department may post the information contained in the
4 documentation on the department’s official Web site.
5 (d)  (1)  A city, county, or city and county receiving funds
6 pursuant to this section shall have three fiscal years to expend the
7 funds following the fiscal year in which the allocation was made
8 by the Controller, and any funds not expended within that period
9 shall be returned to the Controller and be reallocated to other cities,
10 counties, or a city and county, as applicable, pursuant to the
11 allocation formulas set forth in subparagraph (A) or (B) of
12 paragraph (1) of subdivision (l) of Section 8879.23, but excluding
13 the requirement for a minimum city allocation as described in
14 subparagraph (B) of paragraph (1) of that subdivision and section.
15 (2)  Notwithstanding paragraph (1), a city, county, or city and
16 county receiving funds pursuant to this section, during any fiscal
17 year in which funds from the Highway Users Tax Account are
18 deferred, suspended, borrowed, or shifted, shall have four fiscal
19 years from the last date of the fiscal year in which the funds are
20 allocated to it by the Controller to expend the funds.
21 (e)  Subject to the requirements and conditions of this section,
22 it is the intent of the Legislature to appropriate funds from the
23 account so that the Controller may allocate the balance of these
24 funds to eligible local agencies over the next four years, following
25 the 2007–08 fiscal year. Nothing in this section shall prevent the
26 Legislature from appropriating funds on a more expedited basis
27 based on local agency need.
28 (f)  The sum of three hundred fifty million dollars ($350,000,000)
29 is hereby appropriated from funds in the Local Street and Road
30 Improvement, Congestion Relief, and Traffic Safety Account of
31 2006 created pursuant to subdivision (l) of Section 8879.23, for
32 allocation pursuant to this article, as an augmentation to the amount
33 appropriated in Item 9350-104-6065 of the Budget Act of 2007.
34 The total 2007–08 fiscal year appropriation of nine hundred fifty
35 million dollars ($950,000,000) shall be allocated as follows: four
36 hundred million dollars ($400,000,000) to counties and five
37 hundred fifty million dollars ($550,000,000) to cities.
38 (g)  Notwithstanding the provisions of Item 9350-104-6065 of
39 the Budget Act of 2008, a city or city and county that receives any

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1 portion of the funds appropriated by that item shall agree to

2 encumber the funds before July 1, 2010.
3 SEC. 7. Section 14556.7 of the Government Code is amended
4 to read:
5 14556.7. (a)  To provide adequate cash for projects, including,
6 but not limited to, projects in the State Transportation Improvement
7 Program, the State Highway Operation and Protection Program,
8 and the Traffic Congestion Relief Program, and for the support of
9 the department, the department may transfer funds as short-term
10 loans among and between the State Highway Account in the State
11 Transportation Fund, the Transportation Investment Fund in the
12 State Treasury, the Transportation Deferred Investment Fund, the
13 Public Transportation Account in the State Transportation Fund
14 and the Traffic Congestion Relief Fund (TCRF), subject to those
15 terms and conditions that the Director of Finance may impose upon
16 those transfers. When loan balances authorized in this subdivision
17 are outstanding, the Director of Transportation shall report the
18 amounts of loans outstanding with respect to each fund or account
19 as of the last business day of each quarter to the commission. The
20 commission shall monitor the cash-flow loan program authorized
21 in this section and shall provide guidance to the department to
22 ensure that sufficient resources will be available for all projects
23 and all other authorized expenditures from each fund or account
24 so as to not delay any authorized expenditure.
25 (b) For the purposes of this section, a “short-term loan” is a
26 transfer that is made subject to the following conditions:
27 (1)  That any amount loaned is to be repaid in full to the fund or
28 account from which it was loaned during the same fiscal year in
29 which the loan was made, except that repayment may be delayed
30 until a date not more than 30 days after the date of enactment of
31 the annual Budget Act for the subsequent fiscal year.
32 (2)  That loans shall be repaid whenever the funds are needed
33 to meet cash expenditure needs in the loaning fund or account.
34 (c)  This section shall become inoperative on July 1, 2011 2014,
35 and, as of January 1, 2012 2015, is repealed, unless a later enacted
36 statute, that becomes operative on or before January 1, 2012 2015,
37 deletes or extends the dates on which it becomes inoperative and
38 is repealed.
39 SEC. 8. Section 16965 of the Government Code is amended to
40 read:

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1 16965. (a)  The Transportation Debt Service Fund is hereby

2 created in the State Treasury. Moneys in the fund shall, among
3 other things, as provided in this section, be dedicated to payment
4 of debt service on bonds including bonds issued pursuant to the
5 Clean Air and Transportation Improvement Act of 1990 (Part 11.5
6 (commencing with Section 99600) of Division 10 of the Public
7 Utilities Code), the Passenger Rail and Clean Air Bond Act of
8 1990 (Chapter 17 (commencing with Section 2701) of Division 3
9 of the Streets and Highways Code), the Seismic Retrofit Bond Act
10 of 1996 (Chapter 12.48 (commencing with Section 8879) of
11 Division 1 of Title 2), the Highway Safety, Traffic Reduction, Air
12 Quality, and Port Security Bond Act of 2006 (Chapter 12.49
13 (commencing with Section 8879.20) of Division 1 of Title 2), and
14 the Safe, Reliable High-Speed Passenger Train Bond Act for the
15 21st Century (Chapter 20 (commencing with Section 2704) of
16 Division 3 of the Streets and Highways Code). If the moneys in
17 the fund are insufficient to pay the balance of the debt consistent
18 with existing obligations, the General Fund will be used to pay the
19 balance of any debt service.
20 (b)  (1)  From moneys transferred to the fund pursuant to
21 subdivision (b) of Section 7103 of the Revenue and Taxation Code,
22 the Director of Finance is hereby authorized to reimburse the
23 General Fund for up to three hundred thirty-nine million two
24 hundred eighty-nine thousand three hundred forty-five dollars
25 ($339,289,345) for the purpose of offsetting the cost of debt service
26 payments made from the General Fund during the 2007–08 fiscal
27 year for public transportation-related general obligation bond
28 expenditures in the following amounts:
29 (A)  Clean Air and Transportation Improvement Act of 1990,
30 one hundred twenty-three million nine hundred seventy-three
31 thousand four hundred ninety-three dollars ($123,973,493).
32 (B)  Passenger Rail and Clean Air Bond Act of 1990, seventy
33 million nine hundred eighty-three thousand three hundred
34 sixty-three dollars ($70,983,363).
35 (C)  Seismic Retrofit Bond Act of 1996, one hundred forty-four
36 million three hundred thirty-two thousand four hundred eighty-nine
37 dollars ($144,332,489).
38 (2)  From moneys transferred to the fund pursuant to subdivision
39 (b) of Section 7103 of the Revenue and Taxation Code, the Director
40 of Finance is hereby authorized to reimburse the General Fund in

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1 the 2007–08 fiscal year for two hundred million dollars

2 ($200,000,000) for the purpose of offsetting the cost of debt service
3 payments made in prior fiscal years from the General Fund for
4 public transportation-related general obligation bond expenditures.
5 (c)  From moneys transferred to the fund pursuant to subdivisions
6 (c) and (d) of Section 7103 of the Revenue and Taxation Code,
7 the Director of Finance is hereby authorized to reimburse the
8 General Fund any amount necessary to offset the cost of debt
9 service payments made from the General Fund during any fiscal
10 year for transportation-related general obligation bond
11 expenditures.
12 (d)
13 (b)  From moneys transferred to the fund pursuant to an annual
14 Budget Act or other statute from the State Highway Account in
15 the State Transportation Fund, the Director of Finance is hereby
16 authorized to reimburse Controller shall transfer as an expenditure
17 reduction to the General Fund any amount necessary to offset the
18 cost of current year debt service payments made from the General
19 Fund during any fiscal year for transportation-related general
20 obligation bond expenditures consistent with Article XIX of the
21 California Constitution.
22 (e)
23 (c)  From moneys transferred to the fund pursuant to Section
24 2103 of the Streets and Highways Code and subdivisions (a) and
25 (b) of Section 9400.4 of the Vehicle Code, the Director of Finance
26 is hereby authorized to reimburse Controller shall transfer as an
27 expenditure reduction to the General Fund any amount necessary
28 to offset the cost of current year debt service payments made from
29 the General Fund on any bonds issued pursuant to Proposition 192
30 (1996) and three-quarters of the amount of current year debt service
31 payments made from the General Fund on any bonds issued
32 pursuant to Proposition 1B (2006).
33 (f)
34 (d)  From moneys transferred to the fund pursuant to Section
35 183.1 of the Streets and Highways Code, the Director of Finance
36 is hereby authorized to reimburse Controller shall transfer as an
37 expenditure reduction to the General Fund any amount necessary
38 to offset the cost of current year debt service payments made from
39 the General Fund on any bonds issued pursuant to Proposition 116
40 (1990).

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AB 105 — 18 —

1 (g)
2 (e)  From moneys transferred to the fund pursuant to Section
3 99315 of the Public Utilities Code and subdivisions (a) and (b) of
4 Section 9400.4 of the Vehicle Code, the Director of Finance is
5 hereby authorized to reimburse Controller shall transfer as an
6 expenditure reduction to the General Fund any amount necessary
7 to offset the cost of current year debt service payments made from
8 the General Fund on any bonds issued pursuant to Proposition 108
9 (1990) and Proposition 1A (2008), and one-quarter of the amount
10 of current year debt service payments made from the General Fund
11 on any bonds issued pursuant to Proposition 1B (2006). The
12 Department of Finance shall notify the Controller by July 30 of
13 every year of the percentage of debt service that is expected to be
14 paid in that fiscal year on bond-funded projects that qualify as
15 eligible guideway projects consistent with the requirements
16 applicable to the expenditure of revenues under Article XIX of the
17 California Constitution.
18 (f)  On or before the second business day following the date on
19 which transfers are made to the Transportation Debt Service Fund,
20 the Controller shall transfer those funds from the fund to the
21 General Fund pursuant to this section.
22 SEC. 9. Section 99312 of the Public Utilities Code is amended
23 to read:
24 99312. Except as provided in Sections 99311 and 99311.5, and
25 Sections 6051.8 and 6201.8 of the Revenue and Taxation Code,
26 and except as otherwise provided in subdivisions (d) and (e), the
27 funds in the account shall be made available for the following
28 purposes:
29 (a)  Twenty-five Fifty percent for purposes of Section 99315,
30 subject to appropriation by the Legislature.
31 (b)  To the Controller, 37.5 25 percent for allocation to
32 transportation planning agencies, county transportation
33 commissions, and the San Diego Metropolitan Transit Development
34 Board pursuant to Section 99314. Commencing with the 2011–12
35 fiscal year, these funds are hereby continuously appropriated for
36 purposes of this subdivision.
37 (c)  To the Controller, 37.5 25 percent for allocation to
38 transportation agencies, county transportation commissions, and
39 the San Diego Metropolitan Transit Development Board for
40 purposes of Section 99313. Commencing with the 2011–12 fiscal

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1 year, these funds are hereby continuously appropriated for purposes

2 of this subdivision.
3 (d)  (1)  For the 2009–10 fiscal year, notwithstanding any other
4 provision of this section or any other provision of law, the sum of
5 four hundred million dollars ($400,000,000) is hereby appropriated
6 from the account to the Controller for immediate allocation
7 pursuant to paragraph (2). These funds are intended to cover the
8 two-year period of the 2009–10 and 2010–11 fiscal years. The
9 remaining funds in the account subject to this section shall be
10 available for the purposes of Section 99315, subject to
11 appropriation by the Legislature.
12 (2)  (A)  Fifty percent of the amount appropriated to the
13 Controller pursuant to paragraph (1) shall be allocated to
14 transportation planning agencies, county transportation
15 commissions, and the San Diego Metropolitan Transit Development
16 Board pursuant to Section 99314.
17 (B)  Fifty percent of the amount appropriated to the Controller
18 pursuant to paragraph (1) shall be allocated to transportation
19 planning agencies, county transportation commissions, and the
20 San Diego Metropolitan Transit Development Board pursuant to
21 Section 99313.
22 (e)  For the 2010–11 fiscal year, notwithstanding any other
23 provision of this section or any other provision of law, the funds
24 in the account subject to this section shall be made available only
25 for purposes of Section 99315, subject to appropriation by the
26 Legislature.
27 SEC. 10. Section 99312.1 is added to the Public Utilities Code,
28 to read:
29 99312.1. Revenues transferred to the Public Transportation
30 Account pursuant to Sections 6051.8 and 6201.8 of the Revenue
31 and Taxation Code are hereby continuously appropriated to the
32 Controller for allocation as follows:
33 (a)  Fifty percent for allocation to transportation planning
34 agencies, county transportation commissions, and the San Diego
35 Metropolitan Transit Development Board pursuant to Section
36 99314.
37 (b)  Fifty percent for allocation to transportation agencies,
38 county transportation commissions, and the San Diego
39 Metropolitan Transit Development Board for purposes of Section
40 99313.

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1 For purposes of this chapter, the revenues allocated pursuant

2 to this section shall be subject to the same requirements as
3 revenues allocated pursuant to subdivisions (b) and (c), as
4 applicable, of Section 99312.
5 SEC. 11. Section 99312.2 is added to the Public Utilities Code,
6 to read:
7 99312.2. Notwithstanding any other provision of law,
8 twenty-three million dollars ($23,000,000) is hereby appropriated
9 from the Public Transportation Account to the Controller for
10 allocation to local agencies for the 2011–12 fiscal year, with eleven
11 million five hundred thousand dollars ($11,500,000) to be allocated
12 pursuant to Section 99313 and eleven million five hundred
13 thousand dollars ($11,500,000) to be allocated pursuant to Section
14 99314. For purposes of this chapter, the revenues allocated
15 pursuant to this section shall be subject to the same requirements
16 as revenues allocated pursuant to subdivisions (b) and (c), as
17 applicable, of Section 99312.
18 SEC. 12. Section 99315 of the Public Utilities Code is amended
19 to read:
20 99315. Funds made available pursuant to subdivision (a) of
21 Section 99312 shall be available for all of the following purposes:
22 (a)  To the department for bus and passenger rail services
23 pursuant to Sections 14035, 14035.5, and 14038 of the Government
24 Code.
25 (b)  To the department for funding of public transit capital
26 improvement projects in the state transportation improvement
27 program, pursuant to Section 14529 of the Government Code.
28 (c)  To the department for its planning activities not payable
29 from the State Highway Account in the State Transportation Fund,
30 its mass transportation responsibilities, and its assistance in regional
31 transportation planning.
32 (d)  To the department for allocation by the director to the
33 Institute of Transportation Studies of the University of California
34 for training and research in public transportation systems
35 engineering and management and coordination with other
36 transportation modes.
37 (e)  To the commission for its activities not payable from the
38 State Highway Account.

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1 (f)  To the Public Utilities Commission for its passenger rail

2 safety responsibilities specified in statute on commuter rail,
3 intercity rail, and urban rail transit lines.
4 (g)  For transfer to the Transportation Debt Service Fund created
5 by Section 16965 of the Government Code to reimburse the
6 General Fund for current year debt service payments on rail and
7 transit-related general obligation bonds other than those issued
8 pursuant to the Clean Air and Transportation Improvement Act of
9 1990 (Part 11.5 (commencing with Section 99600)), as follows:
10 (1)  For the 2009–10 fiscal year, the Controller shall transfer up
11 to one hundred forty-two million fifty-eight thousand dollars
12 ($142,058,000) to the fund upon order of the Director of Finance
13 for debt service paid or payable within that fiscal year.
14 (2)  For the 2010–11 fiscal year, the Controller shall transfer up
15 to two hundred fifty-four million two hundred twenty-two thousand
16 dollars ($254,222,000) ninety million eight hundred eighty-six
17 thousand dollars ($90,886,000) in revenues collected before
18 November 2, 2010, to the fund, as follows:
19 (A)  By the 15th of every month, the Treasurer, in consultation
20 with the Director of Finance, shall notify the Controller of the
21 amount of debt service that will be paid on each transportation
22 bond during that month.
23 (B)  Within two business days following the 28th of every month,
24 the Controller shall transfer from the account to the Transportation
25 Debt Service Fund an amount equal to monthly debt service paid
26 by the General Fund on any bonds issued pursuant to Proposition
27 108 (1990) and Proposition 1A (2008), and one-quarter of the
28 monthly debt service paid by the General Fund on any bonds issued
29 pursuant to Proposition 1B (2006).
30 (C)  Any transfers made from the Public Transportation Account
31 pursuant to this subdivision for any months after October 2010
32 shall be reversed and repaid to the account, and shall instead be
33 made, to the extent authorized, from weight fee revenues in the
34 State Highway Account as provided for in Section 9400.4 of the
35 Vehicle Code.
36 SEC. 13. Section 185024 of the Public Utilities Code is
37 amended to read:
38 185024. (a)  The authority shall appoint an executive director,
39 exempt from civil service, who shall serve at the pleasure of the

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AB 105 — 22 —

1 authority, to administer the affairs of the authority as directed by

2 the authority.
3 (b)  The executive director is exempt from civil service and shall
4 be paid a salary established by the authority and approved by the
5 Department of Personnel Administration. For purposes of
6 managing and administering the ongoing work of the authority in
7 implementing the high-speed train project, the Governor, upon
8 the recommendation of the executive director, may appoint up to
9 six additional individuals, exempt from civil service, who shall
10 serve at the pleasure of the executive director. Pursuant to this
11 subdivision, the Governor may appoint persons only for the
12 following positions:
13 (1)  Chief program manager.
14 (2)  Up to three regional directors.
15 (3)  Chief financial officer.
16 (4)  Director of risk management and project controls.
17 (c)  The compensation of the executive director and the
18 additional persons authorized by subdivision (b) shall be
19 established by the authority, and approved by the Department of
20 Personnel Administration, in an amount that is reasonably
21 necessary, in the discretion of the authority, to attract and hold a
22 person of superior qualifications. The authority shall cause to be
23 conducted, through the use of independent outside advisers, a
24 salary survey to determine the compensation for the positions
25 under this subdivision. The Department of Personnel
26 Administration may, in its discretion, accept a previously completed
27 salary survey that meets the requirements of this subdivision, and
28 shall review the methodology used in the survey. The salary survey
29 shall consider both of the following:
30 (1)  Other state, regional, and local transportation agencies that
31 are most comparable to the authority and its responsibilities.
32 (2)  Other relevant labor pools.
33 The compensation set by the authority shall not exceed the
34 highest comparable compensation for a position of that type, as
35 determined by the salary survey. Based on the salary survey, these
36 positions shall be paid a salary established by the authority and
37 approved by the Department of Personnel Administration.
38 (c)
39 (d)  The executive director may, as authorized by the authority,
40 appoint necessary staff to carry out the provisions of this part.

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1 SEC. 14. Section 6051.8 of the Revenue and Taxation Code is

2 repealed.
3 6051.8. (a)  Except as provided by Section 6357.3, in addition
4 to the taxes imposed by this part, for the privilege of selling
5 tangible personal property at retail a tax is hereby imposed upon
6 all retailers at the rate of 1.75 percent of the gross receipts of any
7 retailer from the sale of diesel fuel, as defined in Section 60022,
8 sold at retail in this state on and after the operative date of this
9 subdivision.
10 (b)  Subdivision (a) shall become operative on July 1, 2011.
11 SEC. 15. Section 6051.8 is added to the Revenue and Taxation
12 Code, to read:
13 6051.8. (a)  Except as provided by Section 6357.3, in addition
14 to the taxes imposed by this part, for the privilege of selling
15 tangible personal property at retail a tax is hereby imposed upon
16 all retailers at the rate of 1.75 percent of the gross receipts of any
17 retailer from the sale of all diesel fuel, as defined in Section 60022,
18 sold at retail in this state on and after the operative date of this
19 subdivision.
20 (b)  Notwithstanding subdivision (a), for the 2011–12 fiscal year
21 only, the rate referenced in subdivision (a) shall be 1.87 percent.
22 (c)  Notwithstanding subdivision (a), for the 2012–13 fiscal year
23 only, the rate referenced in subdivision (a) shall be 2.17 percent.
24 (d)  Notwithstanding subdivision (a), for the 2013–14 fiscal year
25 only, the rate referenced in subdivision (a) shall be 1.94 percent.
26 (e)  Notwithstanding subdivision (b) of Section 7102, all of the
27 revenues, less refunds, collected pursuant to this section shall be
28 estimated by the State Board of Equalization, with the concurrence
29 of the Department of Finance, and transferred quarterly to the
30 Public Transportation Account in the State Transportation Fund
31 for allocation pursuant to Section 99312.1 of the Public Utilities
32 Code.
33 (f)  Subdivisions (a) to (e), inclusive, shall become operative on
34 July 1, 2011.
35 SEC. 16. Section 6201.8 of the Revenue and Taxation Code is
36 repealed.
37 6201.8. (a)  Except as provided by Section 6357.3, in addition
38 to the taxes imposed by this part, an excise tax is hereby imposed
39 on the storage, use, or other consumption in the state of diesel fuel,
40 as defined in Section 60022, at the rate of 1.75 percent of the sales

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AB 105 — 24 —

1 price of the diesel fuel on and after the operative date of this
2 subdivision.
3 (b)  Subdivision (a) shall become operative on July 1, 2011.
4 SEC. 17. Section 6201.8 is added to the Revenue and Taxation
5 Code, to read:
6 6201.8. (a)  Except as provided by Section 6357.3, in addition
7 to the taxes imposed by this part, an excise tax is hereby imposed
8 on the storage, use, or other consumption in this state of diesel
9 fuel, as defined in Section 60022, at the rate of 1.75 percent of the
10 sales price of the diesel fuel on and after the operative date of this
11 subdivision.
12 (b)  Notwithstanding subdivision (a), for the 2011–12 fiscal year
13 only, the rate referenced in subdivision (a) shall be 1.87 percent.
14 (c)  Notwithstanding subdivision (a), for the 2012–13 fiscal year
15 only, the rate referenced in subdivision (a) shall be 2.17 percent.
16 (d)  Notwithstanding subdivision (a), for the 2013–14 fiscal year
17 only, the rate referenced in subdivision (a) shall be 1.94 percent.
18 (e)  Notwithstanding subdivision (b) of Section 7102, all of the
19 revenues, less refunds, collected pursuant to this section shall be
20 estimated by the State Board of Equalization, with the concurrence
21 of the Department of Finance, and transferred quarterly to the
22 Public Transportation Account in the State Transportation Fund
23 for allocation pursuant to Section 99312.1 of the Public Utilities
24 Code.
25 (f)  Subdivisions (a) to (e), inclusive, shall become operative on
26 July 1, 2011.
27 SEC. 18. Section 6357.3 of the Revenue and Taxation Code is
28 repealed.
29 6357.3. (a) On and after July 1, 2011, there are exempted from
30 the taxes imposed by Sections 6051.8 and 6201.8, the gross receipts
31 from the sale in this state of, and the storage, use, or other
32 consumption in this state of both of the following:
33 (1)  Diesel fuel purchased for use or used in a manner that is
34 exempt from the tax imposed pursuant to Part 31 (commencing
35 with Section 60001) of Division 2 and not subject to the backup
36 tax imposed by Section 60058 or the payment requirement
37 specified in Section 60108.
38 (2)  Diesel fuel subject to the payment requirement specified in
39 Section 60502.2.

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1 (b)  No exemption from the tax imposed pursuant to Sections

2 6051.8 and 6201.8 shall be allowed under this section unless the
3 purchaser furnishes the seller with an exemption certificate,
4 completed in accordance with any instructions or regulations as
5 the board may prescribe.
6 (c)  If a purchaser certifies in writing to the seller that the diesel
7 fuel purchased without payment of the tax imposed pursuant to
8 Section 6051.8 or 6201.8 will be used in a manner entitling the
9 seller to regard the gross receipts or sales price from the sale as
10 exempt from that tax, and uses the diesel fuel in a manner that
11 subjects the diesel fuel to the tax imposed pursuant to Section
12 60050, the purchaser shall be liable for payment of the sales tax
13 imposed pursuant to Section 6051.8, with applicable interest, as
14 if the purchaser were a retailer making a retail sale of the diesel
15 fuel at the time the fuel is so used, and the sales price of the diesel
16 fuel to the purchaser shall be deemed the gross receipts from that
17 retail sale.
18 SEC. 19. Section 6357.3 is added to the Revenue and Taxation
19 Code, to read:
20 6357.3. (a) On and after July 1, 2011, there are exempted from
21 the taxes imposed by Sections 6051.8 and 6201.8, the gross receipts
22 from the sale in this state of, and the storage, use, or other
23 consumption in this state of both of the following:
24 (1)  Diesel fuel purchased for use or used in a manner that is
25 exempt from the tax imposed pursuant to Part 31 (commencing
26 with Section 60001) of Division 2 and not subject to the backup
27 tax imposed by Section 60058 or the payment requirement specified
28 in Section 60108.
29 (2)  Diesel fuel subject to the payment requirement specified in
30 Section 60502.2.
31 (b)  No exemption from the tax imposed pursuant to Sections
32 6051.8 and 6201.8 shall be allowed under this section unless the
33 purchaser furnishes the seller with an exemption certificate,
34 completed in accordance with any instructions or regulations as
35 the board may prescribe.
36 (c)  If a purchaser certifies in writing to the seller that the diesel
37 fuel purchased without payment of the tax imposed pursuant to
38 Section 6051.8 or 6201.8 will be used in a manner entitling the
39 seller to regard the gross receipts or sales price from the sale as
40 exempt from that tax, and uses the diesel fuel in a manner that

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AB 105 — 26 —

1 subjects the diesel fuel to the tax imposed pursuant to Section

2 60050, the purchaser shall be liable for payment of the sales tax
3 imposed pursuant to Section 6051.8, with applicable interest, as
4 if the purchaser were a retailer making a retail sale of the diesel
5 fuel at the time the fuel is so used, and the sales price of the diesel
6 fuel to the purchaser shall be deemed the gross receipts from that
7 retail sale.
8 SEC. 20. Section 6357.7 of the Revenue and Taxation Code is
9 repealed.
10 6357.7. (a)  On and after July 1, 2010, there are exempted from
11 the taxes imposed by this part, the gross receipts from the sale in
12 this state of, and the storage, use, or other consumption in this state
13 of, motor vehicle fuel, as defined in Section 7326.
14 (b)  (1)  Notwithstanding any provision of the Bradley-Burns
15 Uniform Local Sales and Use Tax Law (Part 1.5 (commencing
16 with Section 7200)) or the Transactions and Use Tax Law (Part
17 1.6 (commencing with Section 7251)), the exemption established
18 by this section shall not apply with respect to any tax levied by a
19 county, city, or district pursuant to, or in accordance with, either
20 of those laws.
21 (2)  The exemption established by this section shall not apply
22 with respect to any tax levied pursuant to Section 6051.2, 6051.5,
23 6201.2, or 6201.5, or pursuant to Section 35 of Article XIII of the
24 California Constitution.
25 (c)  On and after July 1, 2010, the State Board of Equalization
26 and the Department of Finance shall recognize that the state no
27 longer receives state sales and use tax revenues from the sale of,
28 and the storage, use, or other consumption of, motor vehicle fuel
29 for purposes of any estimates required to be performed under
30 paragraphs (1) and (2) of subdivision (a) of Section 7102, and
31 Section 7104.2.
32 SEC. 21. Section 6357.7 is added to the Revenue and Taxation
33 Code, to read:
34 6357.7. (a)  On and after July 1, 2010, there are exempted
35 from the taxes imposed by this part, the gross receipts from the
36 sale in this state of, and the storage, use, or other consumption in
37 this state of, motor vehicle fuel, as defined in Section 7326.
38 (b)  (1)  Notwithstanding any provision of the Bradley-Burns
39 Uniform Local Sales and Use Tax Law (Part 1.5 (commencing
40 with Section 7200)) or the Transactions and Use Tax Law (Part

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 — 27 — AB 105

1 1.6 (commencing with Section 7251)), the exemption established

2 by this section shall not apply with respect to any tax levied by a
3 county, city, or district pursuant to, or in accordance with, either
4 of those laws.
5 (2)  The exemption established by this section shall not apply
6 with respect to any tax levied pursuant to Section 6051.2, 6051.5,
7 6201.2, or 6201.5, or pursuant to Section 35 of Article XIII of the
8 California Constitution.
9 (c)  On and after July 1, 2010, the State Board of Equalization
10 and the Department of Finance shall recognize that the state no
11 longer receives state sales and use tax revenues from the sale of,
12 and the storage, use, or other consumption of, motor vehicle fuel
13 for purposes of any estimates required to be performed under
14 paragraphs (1) and (2) of subdivision (a) of Section 7102, and
15 Section 7104.2.
16 SEC. 22. Section 6480.1 of the Revenue and Taxation Code is
17 repealed.
18 6480.1. (a)  At any time that motor vehicle fuel tax or diesel
19 fuel tax is imposed or would be imposed, but for the dyed diesel
20 fuel exemption in paragraph (1) of subdivision (a) of Section
21 60100, or the train operator exemption in paragraph (7) of
22 subdivision (a) of Section 60100 or paragraph (11) of subdivision
23 (a) of Section 7401, or, pursuant to subdivision (f) of Section 6480,
24 would be deemed to be imposed, on any removal, entry, or sale in
25 this state of motor vehicle fuel, aircraft jet fuel, or diesel fuel, the
26 supplier shall collect prepayment of retail sales tax from the person
27 to whom the motor vehicle fuel, aircraft jet fuel, or diesel fuel is
28 sold. However, if no sale occurs at the time of imposition of motor
29 vehicle fuel tax or diesel fuel tax, the supplier shall prepay the
30 retail sales tax on that motor vehicle fuel, aircraft jet fuel, or diesel
31 fuel. The prepayment required to be collected by the supplier
32 constitutes a debt owed by the supplier to this state until paid to
33 the board, until satisfactory proof has been submitted to prove that
34 the retailer of the fuel has paid the retail sales tax to the board, or
35 until a supplier or wholesaler who has consumed the fuel has paid
36 the use tax to the board. Each supplier shall report and pay the
37 prepayment amounts to the board, in a form as prescribed by the
38 board, in the period in which the fuel is sold. On each subsequent
39 sale of that fuel, each seller, other than the retailer, shall collect
40 from his or her purchaser a prepayment computed using the rate

98
AB 105 — 28 —

1 applicable at the time of sale. Each supplier shall provide his or

2 her purchaser with an invoice for, or other evidence of, the
3 collection of the prepayment amounts which shall be separately
4 stated thereon.
5 (b)  (1)  A wholesaler shall collect prepayment of the retail sales
6 tax from the person to whom the motor vehicle fuel, aircraft jet
7 fuel, or diesel fuel is sold. Each wholesaler shall provide his or
8 her purchaser with an invoice for or other evidence of the collection
9 of the prepayment amounts, which shall be separately stated
10 thereon.
11 (2)  Each wholesaler shall report to the board, in a form as
12 prescribed by the board and for the period in which the motor
13 vehicle fuel, aircraft jet fuel, or diesel fuel was sold, all of the
14 following:
15 (A)  The number of gallons of fuel sold and the amount of sales
16 tax prepayments collected by the wholesaler.
17 (B)  The number of tax-paid gallons purchased and the amount
18 of sales tax prepayments made by the wholesaler.
19 (C)  In the event that the amount of sales tax prepayments
20 collected by the wholesaler is greater than the amount of sales tax
21 prepayments made by the wholesaler, then the excess constitutes
22 a debt owed by the wholesaler to the state until paid to the board,
23 or until satisfactory proof has been submitted that the retailer of
24 the fuel has paid the tax to the board.
25 (c)  A supplier or wholesaler who pays the prepayment and issues
26 a resale certificate to the seller, but subsequently consumes the
27 motor vehicle fuel, aircraft jet fuel, or diesel fuel, shall be entitled
28 to a credit against his or her sales and use taxes due and payable
29 for the period in which the prepayment was made, provided that
30 he or she reports and pays the use tax to the board on the
31 consumption of that fuel.
32 (d)  The amount of a prepayment paid by the retailer or a supplier
33 or wholesaler who has consumed the motor vehicle fuel, aircraft
34 jet fuel, or diesel fuel to the seller from whom he or she acquired
35 the fuel shall constitute a credit against his or her sales and use
36 taxes due and payable for the period in which the sale was made.
37 Failure of the supplier or wholesaler to report prepayments or the
38 supplier’s or wholesaler’s failure to comply with any other duty
39 under this article shall not constitute grounds for denial of the
40 credit to the retailer, supplier, or wholesaler, either on a temporary

98
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1 or permanent basis or otherwise. To be entitled to the credit, the

2 retailer, supplier, or wholesaler shall retain for inspection by the
3 board any receipts, invoices, or other documents showing the
4 amount of sales tax prepaid to his or her supplier, together with
5 the evidence of payment.
6 (e)  The rate of the prepayment required to be collected during
7 the period from July 1, 1986, through March 31, 1987, shall be
8 four cents ($0.04) per gallon of motor vehicle fuel distributed or
9 transferred.
10 (f)  On April 1 of each succeeding year, the prepayment rate per
11 gallon for motor vehicle fuel, rounded to the nearest one-half of
12 one cent ($0.005), of the required prepayment shall be established
13 by the board based upon 80 percent of the combined state and local
14 sales tax rate established by Sections 6051, 6051.2, 6051.3, 6051.5,
15 7202, and 7203.1, and Section 35 of Article XIII of the California
16 Constitution on the arithmetic average selling price (excluding
17 sales tax) as determined by the State Energy Resources
18 Conservation and Development Commission, in its latest
19 publication of the “Quarterly Oil Report,” of all grades of gasoline
20 sold through a self-service gasoline station. In the event the
21 “Quarterly Oil Report” is delayed or discontinued, the board may
22 base its determination on other sources of the arithmetic average
23 selling price of gasoline. The board shall make its determination
24 of the rate no later than November 1 of the year prior to the
25 effective date of the new rate. Immediately upon making its
26 determination and setting of the rate, the board shall each year, no
27 later than January 1, notify by mail every supplier, wholesaler,
28 and retailer of motor vehicle fuel. In the event the price of fuel
29 decreases or increases or an exemption from sales tax for sales of
30 fuel is enacted, and the established rate results in or could result
31 in prepayments which consistently exceed or are significantly
32 lower than the retailers’ sales tax liability, the board may readjust
33 the rate.
34 (g)  On April 1 of each succeeding year, the prepayment rate per
35 gallon for aircraft jet fuel, rounded to the nearest one-half of one
36 cent ($0.005), shall be established by the board based upon 80
37 percent of the combined state and local sales tax rate established
38 by Sections 6051, 6051.2, 6051.3, 6051.5, 7202, and 7203.1, and
39 Section 35 of Article XIII of the California Constitution on the
40 arithmetic average selling price (excluding sales and state excise

98
AB 105 — 30 —

1 tax) as determined by the board. The board shall make its

2 determination of the rate no later than November 1 of the year
3 prior to the effective date of the new rate. The rate of the
4 prepayment required to be collected for aircraft jet fuel shall be
5 equal to 80 percent of the arithmetic average selling price of aircraft
6 jet fuel as specified by industry publications. Immediately upon
7 making its determination and setting of the rate, the board shall
8 each year, no later than January 1, notify by mail every supplier,
9 wholesaler, and retailer of aircraft jet fuel. In the event the price
10 of aircraft jet fuel decreases or increases, and the established rate
11 results in prepayments that consistently exceed or are significantly
12 lower than the retailers’ sales tax liability, the board may readjust
13 the rate.
14 (h)  On April 1 of each succeeding year, the prepayment rate per
15 gallon for diesel fuel, rounded to the nearest one-half of one cent
16 ($0.005), shall be established by the board based upon 80 percent
17 of the combined state and local sales tax rate established by
18 Sections 6051, 6051.2, 6051.3, 6051.5, 7202, and 7203.1, and
19 Section 35 of Article XIII of the California Constitution on the
20 arithmetic average selling price (excluding sales and state excise
21 tax) as determined by the board. The board shall make its
22 determination of the rate no later than November 1 of the year
23 prior to the effective date of the new rate. The rate of the
24 prepayment required to be collected for diesel fuel shall be equal
25 to 80 percent of the arithmetic average selling price of diesel fuel
26 as specified by industry publications. Immediately upon making
27 its determination and setting of the rate, the board shall each year,
28 no later than January 1, notify by mail every supplier, wholesaler,
29 and retailer of diesel fuel. In the event the rate of sales tax imposed
30 on sales of diesel fuel increases or decreases or the price of diesel
31 fuel decreases or increases, and the established rate results in or
32 could result in prepayments that consistently exceed or are
33 significantly lower than the retailers’ sales tax liability, the board
34 may readjust the rate.
35 (i)  (1)  Notwithstanding any other provision of this section,
36 motor vehicle fuel sold by a supplier or wholesaler to a qualified
37 purchaser who, pursuant to a contract with the State of California
38 or its instrumentalities, resells that fuel to the State of California
39 or its instrumentalities shall be exempt from the prepayment
40 requirements.

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 — 31 — AB 105

1 (2)  A qualified purchaser who acquires motor vehicle fuel for

2 subsequent resale to the State of California or its instrumentalities
3 pursuant to this subdivision shall furnish to the supplier or
4 wholesaler from whom the fuel is acquired an exemption
5 certificate, completed in accordance with any instructions or
6 regulations as the board may prescribe. The supplier or wholesaler
7 shall retain the certificate in his or her records in support of the
8 exemption. To qualify for the prepayment exemption, both of the
9 following conditions shall apply:
10 (A)  The qualified purchaser does not take possession of the fuel
11 at any time.
12 (B)  The fuel is delivered into storage tanks owned or leased by
13 the State of California or its instrumentalities via facilities of the
14 supplier or wholesaler, or by common or contract carriers under
15 contract with the supplier or wholesaler.
16 (3)  For purposes of this subdivision, “qualified purchaser” means
17 a wholesaler who does not have or maintain a storage facility or
18 facilities for the purpose of selling motor vehicle fuel.
19 SEC. 23. Section 6480.1 is added to the Revenue and Taxation
20 Code, to read:
21 6480.1. (a)  At any time that motor vehicle fuel tax or diesel
22 fuel tax is imposed or would be imposed, but for the dyed diesel
23 fuel exemption in paragraph (1) of subdivision (a) of Section
24 60100, or the train operator exemption in paragraph (7) of
25 subdivision (a) of Section 60100 or paragraph (11) of subdivision
26 (a) of Section 7401, or, pursuant to subdivision (f) of Section 6480,
27 would be deemed to be imposed, on any removal, entry, or sale in
28 this state of motor vehicle fuel, aircraft jet fuel, or diesel fuel, the
29 supplier shall collect prepayment of retail sales tax from the person
30 to whom the motor vehicle fuel, aircraft jet fuel, or diesel fuel is
31 sold. However, if no sale occurs at the time of imposition of motor
32 vehicle fuel tax or diesel fuel tax, the supplier shall prepay the
33 retail sales tax on that motor vehicle fuel, aircraft jet fuel, or diesel
34 fuel. The prepayment required to be collected by the supplier
35 constitutes a debt owed by the supplier to this state until paid to
36 the board, until satisfactory proof has been submitted to prove
37 that the retailer of the fuel has paid the retail sales tax to the board,
38 or until a supplier or wholesaler who has consumed the fuel has
39 paid the use tax to the board. Each supplier shall report and pay
40 the prepayment amounts to the board, in a form as prescribed by

98
AB 105 — 32 —

1 the board, in the period in which the fuel is sold. On each

2 subsequent sale of that fuel, each seller, other than the retailer,
3 shall collect from his or her purchaser a prepayment computed
4 using the rate applicable at the time of sale. Each supplier shall
5 provide his or her purchaser with an invoice for, or other evidence
6 of, the collection of the prepayment amounts which shall be
7 separately stated thereon.
8 (b)  (1)  A wholesaler shall collect prepayment of the retail sales
9 tax from the person to whom the motor vehicle fuel, aircraft jet
10 fuel, or diesel fuel is sold. Each wholesaler shall provide his or
11 her purchaser with an invoice for or other evidence of the
12 collection of the prepayment amounts, which shall be separately
13 stated thereon.
14 (2)  Each wholesaler shall report to the board, in a form as
15 prescribed by the board and for the period in which the motor
16 vehicle fuel, aircraft jet fuel, or diesel fuel was sold, all of the
17 following:
18 (A)  The number of gallons of fuel sold and the amount of sales
19 tax prepayments collected by the wholesaler.
20 (B)  The number of tax-paid gallons purchased and the amount
21 of sales tax prepayments made by the wholesaler.
22 (C)  In the event that the amount of sales tax prepayments
23 collected by the wholesaler is greater than the amount of sales tax
24 prepayments made by the wholesaler, then the excess constitutes
25 a debt owed by the wholesaler to the state until paid to the board,
26 or until satisfactory proof has been submitted that the retailer of
27 the fuel has paid the tax to the board.
28 (c)  A supplier or wholesaler who pays the prepayment and issues
29 a resale certificate to the seller, but subsequently consumes the
30 motor vehicle fuel, aircraft jet fuel, or diesel fuel, shall be entitled
31 to a credit against his or her sales and use taxes due and payable
32 for the period in which the prepayment was made, provided that
33 he or she reports and pays the use tax to the board on the
34 consumption of that fuel.
35 (d)  The amount of a prepayment paid by the retailer or a
36 supplier or wholesaler who has consumed the motor vehicle fuel,
37 aircraft jet fuel, or diesel fuel to the seller from whom he or she
38 acquired the fuel shall constitute a credit against his or her sales
39 and use taxes due and payable for the period in which the sale
40 was made. Failure of the supplier or wholesaler to report

98
 — 33 — AB 105

1 prepayments or the supplier’s or wholesaler’s failure to comply

2 with any other duty under this article shall not constitute grounds
3 for denial of the credit to the retailer, supplier, or wholesaler,
4 either on a temporary or permanent basis or otherwise. To be
5 entitled to the credit, the retailer, supplier, or wholesaler shall
6 retain for inspection by the board any receipts, invoices, or other
7 documents showing the amount of sales tax prepaid to his or her
8 supplier, together with the evidence of payment.
9 (e)  The rate of the prepayment required to be collected during
10 the period from July 1, 1986, through March 31, 1987, shall be
11 four cents ($0.04) per gallon of motor vehicle fuel distributed or
12 transferred.
13 (f)  On April 1 of each succeeding year, the prepayment rate per
14 gallon for motor vehicle fuel, rounded to the nearest one-half of
15 one cent ($0.005), of the required prepayment shall be established
16 by the board based upon 80 percent of the combined state and
17 local sales tax rate established by Sections 6051, 6051.2, 6051.3,
18 6051.5, 7202, and 7203.1, and Section 35 of Article XIII of the
19 California Constitution on the arithmetic average selling price
20 (excluding sales tax) as determined by the State Energy Resources
21 Conservation and Development Commission, in its latest
22 publication of the “Quarterly Oil Report,” of all grades of gasoline
23 sold through a self-service gasoline station. In the event the
24 “Quarterly Oil Report” is delayed or discontinued, the board may
25 base its determination on other sources of the arithmetic average
26 selling price of gasoline. The board shall make its determination
27 of the rate no later than November 1 of the year prior to the
28 effective date of the new rate. Immediately upon making its
29 determination and setting of the rate, the board shall each year,
30 no later than January 1, notify by mail every supplier, wholesaler,
31 and retailer of motor vehicle fuel. In the event the price of fuel
32 decreases or increases or an exemption from sales tax for sales
33 of fuel is enacted, and the established rate results in or could result
34 in prepayments which consistently exceed or are significantly
35 lower than the retailers’ sales tax liability, the board may readjust
36 the rate.
37 (g)  On April 1 of each succeeding year, the prepayment rate
38 per gallon for aircraft jet fuel, rounded to the nearest one-half of
39 one cent ($0.005), shall be established by the board based upon
40 80 percent of the combined state and local sales tax rate

98
AB 105 — 34 —

1 established by Sections 6051, 6051.2, 6051.3, 6051.5, 7202, and

2 7203.1, and Section 35 of Article XIII of the California Constitution
3 on the arithmetic average selling price (excluding sales and state
4 excise tax) as determined by the board. The board shall make its
5 determination of the rate no later than November 1 of the year
6 prior to the effective date of the new rate. The rate of the
7 prepayment required to be collected for aircraft jet fuel shall be
8 equal to 80 percent of the arithmetic average selling price of
9 aircraft jet fuel as specified by industry publications. Immediately
10 upon making its determination and setting of the rate, the board
11 shall each year, no later than January 1, notify by mail every
12 supplier, wholesaler, and retailer of aircraft jet fuel. In the event
13 the price of aircraft jet fuel decreases or increases, and the
14 established rate results in prepayments that consistently exceed
15 or are significantly lower than the retailers’ sales tax liability, the
16 board may readjust the rate.
17 (h)  On April 1 of each succeeding year, the prepayment rate
18 per gallon for diesel fuel, rounded to the nearest one-half of one
19 cent ($0.005), shall be established by the board based upon 80
20 percent of the combined state and local sales tax rate established
21 by Sections 6051, 6051.2, 6051.3, 6051.5, 7202, and 7203.1, and
22 Section 35 of Article XIII of the California Constitution on the
23 arithmetic average selling price (excluding sales and state excise
24 tax) as determined by the board. The board shall make its
25 determination of the rate no later than November 1 of the year
26 prior to the effective date of the new rate. The rate of the
27 prepayment required to be collected for diesel fuel shall be equal
28 to 80 percent of the arithmetic average selling price of diesel fuel
29 as specified by industry publications. Immediately upon making
30 its determination and setting of the rate, the board shall each year,
31 no later than January 1, notify by mail every supplier, wholesaler,
32 and retailer of diesel fuel. In the event the rate of sales tax imposed
33 on sales of diesel fuel increases or decreases or the price of diesel
34 fuel decreases or increases, and the established rate results in or
35 could result in prepayments that consistently exceed or are
36 significantly lower than the retailers’ sales tax liability, the board
37 may readjust the rate.
38 (i)  (1)  Notwithstanding any other provision of this section,
39 motor vehicle fuel sold by a supplier or wholesaler to a qualified
40 purchaser who, pursuant to a contract with the State of California

98
 — 35 — AB 105

1 or its instrumentalities, resells that fuel to the State of California

2 or its instrumentalities shall be exempt from the prepayment
3 requirements.
4 (2)  A qualified purchaser who acquires motor vehicle fuel for
5 subsequent resale to the State of California or its instrumentalities
6 pursuant to this subdivision shall furnish to the supplier or
7 wholesaler from whom the fuel is acquired an exemption certificate,
8 completed in accordance with any instructions or regulations as
9 the board may prescribe. The supplier or wholesaler shall retain
10 the certificate in his or her records in support of the exemption.
11 To qualify for the prepayment exemption, both of the following
12 conditions shall apply:
13 (A)  The qualified purchaser does not take possession of the fuel
14 at any time.
15 (B)  The fuel is delivered into storage tanks owned or leased by
16 the State of California or its instrumentalities via facilities of the
17 supplier or wholesaler, or by common or contract carriers under
18 contract with the supplier or wholesaler.
19 (3)  For purposes of this subdivision, “qualified purchaser”
20 means a wholesaler who does not have or maintain a storage
21 facility or facilities for the purpose of selling motor vehicle fuel.
22 SEC. 24. Section 7102.1 of the Revenue and Taxation Code is
23 repealed.
24 7102.1. Notwithstanding subdivision (b) of Section 7102, the
25 revenues, less refunds, derived from the tax in Sections 6051.8
26 and 6201.8 shall be estimated by the State Board of Equalization,
27 with the concurrence of the Department of Finance, and shall be
28 transferred quarterly to the Public Transportation Account in the
29 State Transportation Fund.
30 SEC. 25. Section 7360 of the Revenue and Taxation Code is
31 repealed.
32 7360. (a)  (1)  A tax of eighteen cents ($0.18) is hereby imposed
33 upon each gallon of fuel subject to the tax in Sections 7362, 7363,
34 and 7364.
35 (2)  If the federal fuel tax is reduced below the rate of nine cents
36 ($0.09) per gallon and federal financial allocations to this state for
37 highway and exclusive public mass transit guideway purposes are
38 reduced or eliminated correspondingly, the tax rate imposed by
39 paragraph (1), on and after the date of the reduction, shall be
40 recalculated by an amount so that the combined state rate under

98
AB 105 — 36 —

1 paragraph (1) and the federal tax rate per gallon equal twenty-seven
2 cents ($0.27).
3 (3)  If any person or entity is exempt or partially exempt from
4 the federal fuel tax at the time of a reduction, the person or entity
5 shall continue to be so exempt under this section.
6 (b)  (1)  On and after July 1, 2010, in addition to the tax imposed
7 by subdivision (a), a tax is hereby imposed upon each gallon of
8 motor vehicle fuel, other than aviation gasoline, subject to the tax
9 in Sections 7362, 7363, and 7364 in an amount equal to 17 3⁄10 cents
10 ($0.173) per gallon.
11 (2)  For the 2011–12 fiscal year and each fiscal year thereafter,
12 the board shall, on or before March 1 of the fiscal year immediately
13 preceding the applicable fiscal year, adjust the rate in paragraph
14 (1) in that manner as to generate an amount of revenue that will
15 equal the amount of revenue loss attributable to the exemption
16 provided by Section 6357.7, based on estimates made by the board,
17 and that rate shall be effective during the state’s next fiscal year.
18 (3)  In order to maintain revenue neutrality for each year,
19 beginning with the rate adjustment on or before March 1, 2012,
20 the adjustment under paragraph (2) shall also take into account the
21 extent to which the actual amount of revenues derived pursuant to
22 this subdivision and, as applicable, Section 7361.1, the revenue
23 loss attributable to the exemption provided by Section 6357.7
24 resulted in a net revenue gain or loss for the fiscal year ending
25 prior to the rate adjustment date on or before March 1.
26 (4)  The intent of paragraphs (2) and (3) is to ensure that the act
27 adding this subdivision and Section 6357.7 does not produce a net
28 revenue gain in state taxes.
29 SEC. 26. Section 7360 is added to the Revenue and Taxation
30 Code, to read:
31 7360. (a)  (1)  A tax of eighteen cents ($0.18) is hereby imposed
32 upon each gallon of fuel subject to the tax in Sections 7362, 7363,
33 and 7364.
34 (2)  If the federal fuel tax is reduced below the rate of nine cents
35 ($0.09) per gallon and federal financial allocations to this state
36 for highway and exclusive public mass transit guideway purposes
37 are reduced or eliminated correspondingly, the tax rate imposed
38 by paragraph (1), on and after the date of the reduction, shall be
39 recalculated by an amount so that the combined state rate under

98
 — 37 — AB 105

1 paragraph (1) and the federal tax rate per gallon equal
2 twenty-seven cents ($0.27).
3 (3)  If any person or entity is exempt or partially exempt from
4 the federal fuel tax at the time of a reduction, the person or entity
5 shall continue to be so exempt under this section.
6 (b)  (1)  On and after July 1, 2010, in addition to the tax imposed
7 by subdivision (a), a tax is hereby imposed upon each gallon of
8 motor vehicle fuel, other than aviation gasoline, subject to the tax
9 in Sections 7362, 7363, and 7364 in an amount equal to seventeen
10 and three-tenths cents ($0.173) per gallon.
11 (2)  For the 2011–12 fiscal year and each fiscal year thereafter,
12 the board shall, on or before March 1 of the fiscal year immediately
13 preceding the applicable fiscal year, adjust the rate in paragraph
14 (1) in that manner as to generate an amount of revenue that will
15 equal the amount of revenue loss attributable to the exemption
16 provided by Section 6357.7, based on estimates made by the board,
17 and that rate shall be effective during the state’s next fiscal year.
18 (3)  In order to maintain revenue neutrality for each year,
19 beginning with the rate adjustment on or before March 1, 2012,
20 the adjustment under paragraph (2) shall also take into account
21 the extent to which the actual amount of revenues derived pursuant
22 to this subdivision and, as applicable, Section 7361.1, the revenue
23 loss attributable to the exemption provided by Section 6357.7
24 resulted in a net revenue gain or loss for the fiscal year ending
25 prior to the rate adjustment date on or before March 1.
26 (4)  The intent of paragraphs (2) and (3) is to ensure that the
27 act adding this subdivision and Section 6357.7 does not produce
28 a net revenue gain in state taxes.
29 SEC. 27. Section 7361.1 of the Revenue and Taxation Code is
30 repealed.
31 7361.1. (a)  For the privilege of storing, for the purpose of sale,
32 each supplier, wholesaler, and retailer owning 1,000 or more
33 gallons of tax-paid motor vehicle fuel, other than aviation gasoline,
34 on July 1, 2010, shall pay a storage tax of 17 3⁄10 cents ($0.173) per
35 gallon of tax-paid motor vehicle fuel, other than aviation gasoline,
36 in storage according to the volumetric measure thereof.
37 (b)  For purposes of this section:
38 (1)  “Owning” means having title to the motor vehicle fuel, other
39 than aviation gasoline.

98
AB 105 — 38 —

1 (2)  “Retailer” means any person who sells motor vehicle fuel,

2 other than aviation gasoline, in this state to a person who
3 subsequently uses the motor vehicle fuel, other than aviation
4 gasoline.
5 (3)  “Storing” includes the ownership or possession of tax-paid
6 motor vehicle fuel, other than aviation gasoline, outside of the bulk
7 transfer/terminal system, including the holding of tax-paid motor
8 vehicle fuel, other than aviation gasoline, for sale at wholesale or
9 retail locations stored in a container of any kind, including railroad
10 tank cars and trucks or trailer cargo tanks. “Storing” also includes
11 tax-paid motor vehicle fuel, other than aviation gasoline, purchased
12 from and invoiced by the seller, and tax-paid motor vehicle fuel,
13 other than aviation gasoline removed from a terminal or entered
14 into by a supplier, prior to the date specified in subdivision (a) and
15 in transit on that date.
16 (4)  “Wholesaler” means any person who sells motor vehicle
17 fuel, other than aviation gasoline, in this state for resale to a retailer
18 or to a person who is not a retailer and subsequently uses the motor
19 vehicle fuel, other than aviation gasoline.
20 SEC. 28. Section 7361.1 is added to the Revenue and Taxation
21 Code, to read:
22 7361.1. (a)  For the privilege of storing, for the purpose of
23 sale, each supplier, wholesaler, and retailer owning 1,000 or more
24 gallons of tax-paid motor vehicle fuel, other than aviation gasoline,
25 on July 1, 2010, shall pay a storage tax of seventeen and
26 three-tenths cents ($0.173) per gallon of tax-paid motor vehicle
27 fuel, other than aviation gasoline, in storage according to the
28 volumetric measure thereof.
29 (b)  For purposes of this section:
30 (1)  “Owning” means having title to the motor vehicle fuel, other
31 than aviation gasoline.
32 (2)  “Retailer” means any person who sells motor vehicle fuel,
33 other than aviation gasoline, in this state to a person who
34 subsequently uses the motor vehicle fuel, other than aviation
35 gasoline.
36 (3)  “Storing” includes the ownership or possession of tax-paid
37 motor vehicle fuel, other than aviation gasoline, outside of the
38 bulk transfer or terminal system, including the holding of tax-paid
39 motor vehicle fuel, other than aviation gasoline, for sale at
40 wholesale or retail locations stored in a container of any kind,

98
 — 39 — AB 105

1 including railroad tank cars and trucks or trailer cargo tanks.

2 “Storing” also includes tax-paid motor vehicle fuel, other than
3 aviation gasoline, purchased from and invoiced by the seller, and
4 tax-paid motor vehicle fuel, other than aviation gasoline removed
5 from a terminal or entered into by a supplier, prior to the date
6 specified in subdivision (a) and in transit on that date.
7 (4)  “Wholesaler” means any person who sells motor vehicle
8 fuel, other than aviation gasoline, in this state for resale to a
9 retailer or to a person who is not a retailer and subsequently uses
10 the motor vehicle fuel, other than aviation gasoline.
11 SEC. 29. Section 7653.1 of the Revenue and Taxation Code is
12 repealed.
13 7653.1. On or before August 31, 2010, each person subject to
14 the storage tax imposed under Section 7361.1 shall prepare and
15 file with the board, in a form prescribed by the board, a return
16 showing the total number of gallons of tax-paid motor vehicle fuel,
17 other than aviation gasoline, owned by the person on July 1, 2010,
18 the amount of the storage tax, and any other information that the
19 board deems necessary for the proper administration of this part.
20 The return shall be accompanied by a remittance payable to the
21 Controller in the amount of tax due.
22 SEC. 30. Section 7653.1 is added to the Revenue and Taxation
23 Code, to read:
24 7653.1. On or before August 31, 2010, each person subject to
25 the storage tax imposed under Section 7361.1 shall prepare and
26 file with the board, in a form prescribed by the board, a return
27 showing the total number of gallons of tax-paid motor vehicle fuel,
28 other than aviation gasoline, owned by the person on July 1, 2010,
29 the amount of the storage tax, and any other information that the
30 board deems necessary for the proper administration of this part.
31 The return shall be accompanied by a remittance payable to the
32 Controller in the amount of tax due.
33 SEC. 31. Section 60050 of the Revenue and Taxation Code is
34 repealed.
35 60050. (a)  (1)  A tax of eighteen cents ($0.18) is hereby
36 imposed upon each gallon of diesel fuel subject to the tax in
37 Sections 60051, 60052, and 60058.
38 (2)  If the federal fuel tax is reduced below the rate of fifteen
39 cents ($0.15) per gallon and federal financial allocations to this
40 state for highway and exclusive public mass transit guideway

98
AB 105 — 40 —

1 purposes are reduced or eliminated correspondingly, the tax rate

2 imposed by paragraph (1), including any reduction or adjustment
3 pursuant to subdivision (b), on and after the date of the reduction,
4 shall be increased by an amount so that the combined state rate
5 under paragraph (1) and the federal tax rate per gallon equal what
6 it would have been in the absence of the federal reduction.
7 (3)  If any person or entity is exempt or partially exempt from
8 the federal fuel tax at the time of a reduction, the person or entity
9 shall continue to be exempt under this section.
10 (b)  (1)  On July 1, 2011, the tax rate specified in paragraph (1)
11 of subdivision (a) shall be reduced to 13.6 cents ($0.136) and every
12 July 1 thereafter shall be adjusted pursuant to paragraphs (2) and
13 (3).
14 (2)  For the 2012–13 fiscal year and each fiscal year thereafter,
15 the board shall, on or before March 1 of the fiscal year immediately
16 preceding the applicable fiscal year, adjust the rate reduction in
17 paragraph (1) in that manner as to result in a revenue loss
18 attributable to paragraph (1) that will equal the amount of revenue
19 gain attributable to Sections 6051.8 and 6201.8, based on estimates
20 made by the board, and that rate shall be effective during the state’s
21 next fiscal year.
22 (3)  In order to maintain revenue neutrality for each year,
23 beginning with the rate adjustment on or before March 1, 2013,
24 the adjustment under paragraph (2) shall take into account the
25 extent to which the actual amount of revenues derived pursuant to
26 Sections 6051.8 and 6201.8 and the revenue loss attributable to
27 this subdivision resulted in a net revenue gain or loss for the fiscal
28 year ending prior to the rate adjustment date on or before March
29 1.
30 (4)  The intent of paragraphs (2) and (3) is to ensure that the act
31 adding this subdivision and Sections 6051.8 and 6201.8 does not
32 produce a net revenue gain in state taxes.
33 SEC. 32. Section 60050 is added to the Revenue and Taxation
34 Code, to read:
35 60050. (a)  (1)  A tax of eighteen cents ($0.18) is hereby
36 imposed upon each gallon of diesel fuel subject to the tax in
37 Sections 60051, 60052, and 60058.
38 (2)  If the federal fuel tax is reduced below the rate of fifteen
39 cents ($0.15) per gallon and federal financial allocations to this
40 state for highway and exclusive public mass transit guideway

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1 purposes are reduced or eliminated correspondingly, the tax rate

2 imposed by paragraph (1), including any reduction or adjustment
3 pursuant to subdivision (b), on and after the date of the reduction,
4 shall be increased by an amount so that the combined state rate
5 under paragraph (1) and the federal tax rate per gallon equal what
6 it would have been in the absence of the federal reduction.
7 (3)  If any person or entity is exempt or partially exempt from
8 the federal fuel tax at the time of a reduction, the person or entity
9 shall continue to be exempt under this section.
10 (b)  (1)  On July 1, 2011, the tax rate specified in paragraph (1)
11 of subdivision (a) shall be reduced to thirteen cents ($0.13) and
12 every July 1 thereafter shall be adjusted pursuant to paragraphs
13 (2) and (3).
14 (2)  For the 2012–13 fiscal year and each fiscal year thereafter,
15 the board shall, on or before March 1 of the fiscal year immediately
16 preceding the applicable fiscal year, adjust the rate reduction in
17 paragraph (1) in that manner as to result in a revenue loss
18 attributable to paragraph (1) that will equal the amount of revenue
19 gain attributable to Sections 6051.8 and 6201.8, based on estimates
20 made by the board, and that rate shall be effective during the
21 state’s next fiscal year.
22 (3)  In order to maintain revenue neutrality for each year,
23 beginning with the rate adjustment on or before March 1, 2013,
24 the adjustment under paragraph (2) shall take into account the
25 extent to which the actual amount of revenues derived pursuant
26 to Sections 6051.8 and 6201.8 and the revenue loss attributable
27 to this subdivision resulted in a net revenue gain or loss for the
28 fiscal year ending prior to the rate adjustment date on or before
29 March 1.
30 (4)  The intent of paragraphs (2) and (3) is to ensure that the
31 act adding this subdivision and Sections 6051.8 and 6201.8 does
32 not produce a net revenue gain in state taxes.
33 SEC. 33. Section 167 of the Streets and Highways Code is
34 amended to read:
35 167. (a)  Funds in the State Highway Account in the State
36 Transportation Fund shall be programmed, budgeted subject to
37 Section 163, and expended to maximize the use of federal funds
38 and shall be based on the following sequence of priorities:
39 (1)  Operation, maintenance, and rehabilitation of the state
40 highway system.

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1 (2)  Safety improvements where physical changes, other than

2 adding additional lanes, would reduce fatalities and the number
3 and severity of injuries.
4 (3)  Transportation capital improvements that expand capacity
5 or reduce congestion, or do both.
6 (4)  Environmental enhancement and mitigation programs.
7 (b)  With respect to the funds in the State Highway Account, in
8 the Public Transportation Account, and in the Passenger Rail Bond
9 Fund, the proposed budget shall be organized on a program basis.
10 The proposed budget shall list the proposed expenditures for the
11 transportation program under the following program elements:
12 (1)  Administration.
13 (2)  Program development.
14 (3)  Maintenance.
15 (4)  State highway operation and protection.
16 (5)  Local assistance.
17 (6)  Interregional improvements.
18 (7)  Regional improvements.
19 (8)  Environmental enhancement and mitigation programs.
20 (c)  State operations expenditure amounts of the department for
21 interregional and regional transportation improvement projects
22 shall be listed as required by subdivision (b) of Section 14529 of
23 the Government Code, but those amounts other than those for the
24 acquisition of rights-of-way and construction shall not be subject
25 to allocation by the commission.
26 (d)  To align the annual budget with the adopted state
27 transportation improvement program, the department may submit
28 to the Department of Finance revised capital outlay support and
29 capital outlay budget estimates as part of its May revision process.
30 Budget proposals related to these changes shall be provided to
31 the Legislature no later than May 1.
32 (e)  The budget shall not include specific appropriations for
33 specific transportation improvement projects, and the Legislature
34 shall not enact legislation containing specific individual
35 transportation projects.
36 (f)  The basis for defining major and minor capital outlay projects
37 shall be established by the commission.
38 (g)  The Legislative Analyst shall prepare an analysis of the
39 proposed expenditures for each program element as a part of the
40 budget analysis.

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1 (h)  The department shall submit to the Legislative Analyst, and

2 the Senate Committee on Budget and Fiscal Review and the
3 Assembly Committee on Budget, on an annual basis, supplemental
4 information to substantiate the department’s proposed capital
5 outlay support budget. The information shall be provided no later
6 than May 1 of each year, and may be provided at an earlier date.
7 The information shall include, but not be limited to, the following:
8 (1)  A list of projects for which the department will perform
9 capital outlay support work in the budget year. For each project,
10 the department shall include:
11 (A)  The planned project support budget for support of
12 environmental, design, right-of-way, and construction phases.
13 (B)  The planned capital costs, including construction capital
14 costs and right-of-way capital costs.
15 (C)  The estimated or actual construction start date.
16 (D)  The name and year of the state transportation program in
17 which the project is programmed, if applicable.
18 (E)  Total prior fiscal year expenditures for capital outlay
19 support.
20 (F)  The number of full-time equivalent positions requested to
21 perform support of environmental, design, right-of-way, and
22 construction work in the fiscal year of the budget request.
23 (G)  Milestones of project work by phases that are planned to
24 be completed in the fiscal year of the budget request.
25 (2)  The capital-to-support ratio for all projects completed in
26 the prior fiscal year in each program in each district.
27 (3)  The current total number of authorized and vacant positions
28 in the capital outlay support program in headquarters and in each
29 district.
30 (4)  A five-year projection of the department’s staffing needs to
31 support the state’s transportation capital programs and any
32 workload performed by the department related to federal or local
33 funding for highway capital projects.
34 (5)  The average cost of a personnel-year equivalent in each
35 district based on the department’s existing contracts for capital
36 outlay support work performed by a private company under
37 contract with the department. For each average cost, the
38 department shall provide a description of what factors are included
39 in that cost.

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1 (6)  The average cost of a state staff personnel-year in the capital

2 outlay support program in each district and in headquarters. The
3 cost shall include the salary and wages, benefits, program
4 overhead, administrative overhead, and other associated costs.
5 The department shall provide a description of each component of
6 the average cost.
7 SEC. 34. Section 183.1 of the Streets and Highways Code is
8 amended to read:
9 183.1. (a)  Notwithstanding subdivision (a) of Section 182 or
10 any other provision of law, money deposited into the account that
11 is not subject to Article XIX of the California Constitution,
12 including, but not limited to, money that is derived from the sale
13 of documents, charges for miscellaneous services to the public,
14 condemnation deposits fund investments, rental of state property,
15 or any other miscellaneous uses of property or money, may be
16 used for any transportation purpose authorized by statute, upon
17 appropriation by the Legislature or, after transfer to another fund,
18 upon appropriation by the Legislature from that fund.
19 (b)  (1)  Not later than November 1 of each year, except as
20 otherwise provided in subdivision (c), based on prior year financial
21 statements, the Controller shall transfer the funds identified in
22 subdivision (a) for the prior fiscal year to the Public Transportation
23 Account in the State Transportation Fund.
24 (2)  From the funds transferred to the Public Transportation
25 Account pursuant to this subdivision in the 2009–10 fiscal year,
26 the Controller shall retransfer to the State Highway Account the
27 sum of seventy-eight million nine hundred three thousand dollars
28 ($78,903,000). Notwithstanding paragraph (1), the Controller shall
29 then transfer these funds from the State Highway Account to the
30 Transportation Debt Service Fund in the State Transportation Fund
31 for debt service paid or payable within that fiscal year.
32 (c)  Notwithstanding subdivision (b), in
33 (b)  In the 2010–11, 2011–12, and 2012–13 fiscal year years,
34 and not later than November 1, 2010 of each of those years, based
35 on prior year financial statements, the Controller shall transfer the
36 funds identified in subdivision (a) for the prior fiscal year to the
37 Transportation Debt Service Fund in the State Transportation Fund.
38 (c)  Commencing with the 2013–14 fiscal year, the revenues
39 identified in subdivision (a) shall remain in the State Highway
40 Account until appropriated by the Legislature.

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1 (d)  Notwithstanding Section 99312 of the Public Utilities Code,

2 commencing with the 2011–12 fiscal year, the funds transferred
3 to the Public Transportation Account pursuant to subdivision (b)
4 shall be made available only for the purposes of Section 99315 of
5 the Public Utilities Code, subject to appropriation by the
6 Legislature, except as provided in paragraphs (1) and (2).
7 (1)  For the 2011–12 fiscal year, eleven million five hundred
8 thousand dollars ($11,500,000) shall, subject to appropriation by
9 the Legislature, be allocated pursuant to subdivision (b) of Section
10 99312 of the Public Utilities Code, and eleven million five hundred
11 thousand dollars ($11,500,000) shall, subject to appropriation by
12 the Legislature, be allocated pursuant to subdivision (c) of Section
13 99312 of the Public Utilities Code.
14 (2)  For the 2012–13 fiscal year, six million dollars ($6,000,000)
15 shall, subject to appropriation by the Legislature, be allocated
16 pursuant to subdivision (b) of Section 99312 of the Public Utilities
17 Code, and six million dollars ($6,000,000) shall, subject to
18 appropriation by the Legislature, be allocated pursuant to
19 subdivision (c) of Section 99312 of the Public Utilities Code.
20 SEC. 35. Section 183.2 is added to the Streets and Highways
21 Code, to read:
22 183.2. Notwithstanding any other provision of law, the
23 repayment date for the loan of one hundred thirty-five million
24 dollars ($135,000,000) made from the State Highway Account to
25 the General Fund pursuant to Item 2660-011-0042 of Section 2.00
26 of the Budget Act of 2009 is extended from June 30, 2012, to June
27 30, 2013. The Legislature finds and declares that the revenues to
28 make the loan were derived from vehicle weight fees deposited in
29 the State Highway Account.
30 SEC. 36. Section 2103 of the Streets and Highways Code is
31 amended to read:
32 2103. (a)  Of the net revenues deposited to the credit of the
33 Highway Users Tax Account that are derived from the increases
34 in the rates of taxes that are imposed pursuant to subdivision (b)
35 of Section 7360 and Section 7361.1 of the Revenue and Taxation
36 Code, all of the following shall occur on a monthly basis:
37 (1)  (A)  By the 15th day of every month, the Treasurer’s office,
38 in consultation with the Department of Finance, shall notify the
39 Controller of the amount of debt service that will be paid on each
40 transportation bond during that month.

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AB 105 — 46 —

1 (B)  Within two business days following the 28th day of each

2 month, the Controller shall transfer to the Transportation Debt
3 Service Fund an amount equal to the amount of monthly debt
4 service paid by the General Fund on any bonds issued pursuant to
5 the Seismic Retrofit Bond Act of 1996 (Chapter 12.48
6 (commencing with Section 8879) of Division 1 of Title 2 of the
7 Government Code) or any other highway bonds, and three-quarters
8 of the amount of monthly debt service paid on any bonds issued
9 pursuant to the Highway Safety, Traffic Reduction, Air Quality,
10 and Port Security Bond Act of 2006 (Chapter 12.49 (commencing
11 with Section 8879.20) of Division 1 of Title 2) for reimbursement
12 of the General Fund for these costs. If revenues available pursuant
13 to this subdivision in any given month are insufficient to fully
14 reimburse the General Fund for the debt service payments made,
15 the first revenues available pursuant to this subdivision in the
16 following month or months shall be transferred to the
17 Transportation Debt Service Fund so that all debt service payments
18 made on these bonds from the General Fund in a given fiscal year
19 are fully reimbursed. However, no further transfers shall be made
20 pursuant to this subparagraph once the transfers for the months
21 of July to October, inclusive, in 2010 have been made. Any
22 transfers made from the net revenues identified in this paragraph
23 for highway bond debt service for months after October 2010 shall
24 be reversed and shall instead be made from weight fee revenues
25 in the State Highway Account, as described in subparagraph (D).
26 (C)  Beginning November 2, 2010, the Controller shall transfer
27 to the State Highway Account within two business days following
28 the 28th day of each month all of the monthly net revenues
29 identified in subparagraph (B) that were designated for highway
30 bond debt service reimbursement but that have not been
31 transferred, or that were transferred by means of a transfer that
32 was reversed, pursuant to that subparagraph. To the extent the
33 Controller has distributed any of those net revenues to cities and
34 counties pursuant to subparagraph (C) of paragraph (3) between
35 November 2, 2010, and the effective date of this subparagraph,
36 the Controller shall subsequently reduce the amount transferred
37 to cities and counties on a monthly basis pursuant to subparagraph
38 (C) of paragraph (3) and shall instead transfer these funds to the
39 State Highway Account until all of the revenues that would
40 otherwise have been transferred to the State Highway Account on

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1 and after November 2, 2010, pursuant to this subparagraph have

2 been so transferred.
3 (D)  Any remaining amount of the highway bond debt service
4 reimbursement authorized by this paragraph that has not been
5 made pursuant to subparagraph (B) on and after November 2,
6 2010, shall instead be made pursuant to subdivisions (a) and (b)
7 of Section 9400.4 of the Vehicle Code from revenues in the State
8 Highway Account derived from weight fees deposited in the account
9 pursuant to subdivision (e) of Section 9400.1 and Section 42205
10 of the Vehicle Code.
11 (2)  (A)  In the 2010–11 fiscal year, after the monthly transfer
12 made pursuant to paragraph (1), the sum of fifty-four million one
13 hundred sixty-seven thousand dollars ($54,167,000) per month
14 shall be held in the account for future appropriation by the
15 Legislature.
16 (B)  Notwithstanding any other provision of law, with respect
17 to the monthly net revenues described in subparagraph (A), no
18 further transfers of these revenues for the purpose of loans to the
19 General Fund shall be made pursuant to Item 2660-011-0062 of
20 Section 2.00 of the Budget Act of 2010 once the loan transfers for
21 the months of July to October, inclusive, in 2010 have been made.
22 Any transfers made from the monthly net revenues in subparagraph
23 (A) for months after October 2010 shall be reversed and shall
24 instead be made from weight fee revenues in the State Highway
25 Account, as described in subparagraph (D). The revenues from
26 loan repayments shall be held in the Highway Users Tax Account
27 for future appropriation by the Legislature.
28 (C)  Beginning November 2, 2010, all of the monthly net revenues
29 described in subparagraph (A) shall instead be transferred by the
30 Controller to the State Highway Account within two business days
31 following the 28th day of each month. To the extent that the
32 Controller has distributed any of the revenues identified in this
33 paragraph to cities and counties pursuant to subparagraph (C) of
34 paragraph (3) between October 14, 2010, and the effective date
35 of this subparagraph, the Controller shall subsequently reduce
36 the amount transferred to cities and counties on a monthly basis
37 pursuant to subparagraph (C) of paragraph (3) and shall instead
38 transfer these funds to the State Highway Account until all of the
39 revenues that would have been transferred to the General Fund
40 as a loan pursuant to Item 2660-011-0062 of Section 2.00 of the

98
AB 105 — 48 —

1 Budget Act of 2010 on and after November 2, 2010, have instead

2 been transferred to the State Highway Account.
3 (D)  Any remaining amount of the loans to the General Fund
4 authorized pursuant to Item 2660-011-0062 of Section 2.00 of the
5 Budget Act of 2010 that has not been made pursuant to
6 subparagraph (B) on and after November 2, 2010, shall instead
7 be made pursuant to subdivisions (a) and (b) of Section 9400.4 of
8 the Vehicle Code from revenues in the State Highway Account
9 derived from weight fees deposited in the account pursuant to
10 subdivision (e) of Section 9400.1 and Section 42205 of the Vehicle
11 Code.
12 (3)  The Controller shall transfer any remaining net revenues
13 subject to this subdivision as follows:
14 (A)  Forty-four percent shall be transferred to the State Highway
15 Account to fund projects in the State Transportation Improvement
16 Program that are consistent with Section 1 of Article XIX of the
17 California Constitution, except in the 2010–11 fiscal year, 50
18 percent shall be transferred for purposes of this subparagraph.
19 (B)  Twelve percent shall be transferred to the State Highway
20 Account to fund projects in the State Highway Operation and
21 Protection Program, except in the 2010–11 fiscal year, no revenues
22 shall be transferred for purposes of this subparagraph.
23 (C)  Forty-four percent shall be apportioned by the Controller
24 for local street and road purposes, except in the 2010–11 fiscal
25 year, 50 percent shall be transferred for purposes of this
26 subparagraph as follows:
27 (i)  Fifty percent shall be apportioned by the Controller to cities,
28 including a city and county, in the proportion that the total
29 population of the city bears to the total population of all the cities
30 in the state.
31 (ii)  Fifty percent shall be apportioned by the Controller to
32 counties, including a city and county, in accordance with the
33 following formulas:
34 (I)  Seventy-five percent shall be apportioned among the counties
35 in the proportion that the number of fee-paid and exempt vehicles
36 that are registered in the county bear to the number of fee-paid and
37 exempt vehicles registered in the state.
38 (II)  Twenty-five percent shall be apportioned among the counties
39 in the proportion that the number of miles of maintained county
40 roads in each county bear to the total number of miles of

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1 maintained county roads in the state. For the purposes of

2 apportioning funds under this subparagraph, any roads within the
3 boundaries of a city and county that are not state highways shall
4 be deemed to be county roads.
5 (b)  After the transfers or other actions pursuant to subdivision
6 (a), at least 90 percent of the balance deposited to the credit of the
7 Highway Users Tax Account in the Transportation Tax Fund by
8 the 28th day of each month shall be apportioned or transferred, as
9 applicable, by the Controller by the second working day thereafter,
10 except for June, in which case the apportionment or transfer shall
11 be made the same day. These apportionments or transfers shall be
12 made as provided for in Sections 2104 to 2122, inclusive. If
13 information is not available to make the apportionment or transfer
14 as required, the apportionment or transfer shall be made on the
15 basis of the information of the previous month. Amounts not
16 apportioned or transferred shall be included in the apportionment
17 or transfer of the subsequent month.
18 (c) Notwithstanding any other law, the funds apportioned by the
19 Controller to cities and counties pursuant to subparagraph (C) of
20 paragraph (3) of subdivision (a) are not subject to Section 7104
21 or 7104.2 of the Revenue and Taxation Code. These funds may be
22 expended for any street and road purpose consistent with the
23 requirements of this chapter.
24 SEC. 37. Section 1661 of the Vehicle Code is amended to read:
25 1661. (a)  (1)  Except for vehicles registered pursuant to Article
26 5 (commencing with Section 9700) of Chapter 6 of Division 3, the
27 department shall notify the registered owner of each vehicle of the
28 date that the registration renewal fees of for the vehicle are due,
29 at least 60 days prior to that due date. The department shall indicate
30 the fact that the required notice was mailed shall be indicated by
31 a notation in the department’s records.
32 (2)  Notwithstanding paragraph (1), commencing on June 8,
33 2011, the department shall notify the registered owner of each
34 vehicle, except a vehicle registered pursuant to Article 5
35 (commencing with Section 9700) of Chapter 6 of Division 3, that
36 the registration renewal fees for the vehicle are due, at least 30
37 days prior to that due date. This paragraph shall become
38 inoperative on January 1, 2012.
39 (b)  The department shall include in any final notice of delinquent
40 registration provided to the registered owner of a vehicle whose

98
AB 105 — 50 —

1 registration has not been properly renewed as required under this

2 code, information relating to the potential removal and
3 impoundment of that vehicle under subdivision (o) of Section
4 22651.
5 SEC. 38. Section 4601 of the Vehicle Code is amended to read:
6 4601. (a)  Except as otherwise provided in this code, every a
7 vehicle registration and registration card expires at midnight on
8 the expiration date designated by the director pursuant to Section
9 1651.5, and shall be renewed prior to the expiration of the
10 registration year. The department may, upon payment of the proper
11 fees, renew the registration of vehicles.
12 (b)  Notwithstanding any other provision of law, renewal of
13 registration for any vehicle that is either currently registered or for
14 which a certification pursuant to Section 4604 has been filed may
15 be obtained not more than 75 days prior to the expiration of the
16 current registration or certification.
17 (c)  Notwithstanding subdivision (b) or any other law,
18 commencing on June 8, 2011, the renewal of registration for a
19 vehicle that expires on or before June 30, 2011, may be obtained
20 not more than 75 days prior to the expiration of the current
21 registration or certification and the renewal of registration for a
22 vehicle that expires on or after July 1, 2011, or for which a
23 certification, pursuant to Section 4604 has been filed, may be
24 obtained not more than 15 days prior to the expiration of the
25 current registration or certification. This subdivision shall become
26 inoperative on July 1, 2011.
27 SEC. 39. Section 5902.5 of the Vehicle Code is amended to
28 read:
29 5902.5. Whenever any (a)  If an application for a registration
30 transaction is filed with the department during the 30 days
31 immediately preceding the date of expiration of registration of the
32 vehicle, the application shall be accompanied by the full renewal
33 fees for the ensuing registration year in addition to any other fees
34 that are due and payable.
35 (b)  Notwithstanding subdivision (a), commencing on the date
36 that this subdivision becomes operative, if an application for a
37 registration transaction is filed with the department during the 10
38 days immediately preceding the date of expiration of registration
39 of the vehicle, the application shall be accompanied by the full
40 renewal fees for the ensuing registration year in addition to any

98
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1 other fees that are due and payable. This subdivision shall become
2 inoperative on July 1, 2011.
3 SEC. 40. Section 9400.4 is added to the Vehicle Code, to read:
4 9400.4. Weight fee revenue deposited into the State Highway
5 Account pursuant to subdivision (e) of Section 9400.1 and Section
6 42205 shall be used as follows:
7 (a)  For the 2010–11 fiscal year, seven hundred fifty-six million
8 three hundred ninety-six thousand dollars ($756,396,000) is hereby
9 appropriated from weight fee revenues in the State Highway
10 Account for transfer to the General Fund as transportation bond
11 debt service reimbursement and loans as follows:
12 (1)  The Controller shall transfer all weight fee revenues
13 deposited into the State Highway Account in any month to the
14 Transportation Debt Service Fund for transfer to the General Fund
15 as reimbursement for debt service costs until all of the debt service
16 paid on transportation bonds for projects that the Director of
17 Finance indicates qualify for reimbursement as provided for in
18 Section 16965 of the Government Code have been reimbursed.
19 (2)  After the Director of Finance has notified the Controller
20 that all debt service costs for the 2010–11 fiscal year have been
21 reimbursed, the Controller shall transfer any remaining monthly
22 weight fee revenues in the State Highway Account to the General
23 Fund as a loan until the full amount appropriated in this
24 subdivision has been transferred to the General Fund. Of the net
25 amount loaned in the 2010–11 fiscal year, two hundred five million
26 eighty-one thousand dollars ($205,081,000) shall be repaid by
27 June 30, 2014, one hundred forty-four million four hundred
28 forty-four thousand dollars ($144,444,000) shall be repaid by June
29 30, 2015, and any remaining balance of the loan shall be repaid
30 by June 30, 2016.
31 (3)  By June 15, 2011, the Director of Finance in consultation
32 with the Treasurer shall notify the Controller regarding the final
33 amount of debt service paid from the General Fund during the
34 2010–11 fiscal year pursuant to Section 16965 of the Government
35 Code and shall direct the Controller to reverse and adjust any
36 transfers made as debt service reimbursements or loans so that a
37 maximum amount of transfers are made for debt service
38 reimbursements and with any loan amounts limited to the difference
39 between this amount and the total amount appropriated in this
40 subdivision. The total amount of weight fee revenues transferred

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AB 105 — 52 —

1 from the State Highway Account for the 2010–11 fiscal year shall
2 not be greater than the total amount of weight fee revenues
3 deposited into the State Highway Account for that year.
4 (4)  With respect to transfers or portions of transfers that cannot
5 be made in any given month if weight fee revenues are insufficient,
6 the first weight fee revenues available in the following month or
7 months shall be used to complete the transfers for the previous
8 month or months prior to making additional transfers for later
9 months.
10 (b)  For the 2011–12 fiscal year, eight hundred sixty-six million
11 three hundred thousand dollars ($866,300,000) is hereby
12 appropriated from weight fee revenues in the State Highway
13 Account for transfer to the General Fund as debt service
14 reimbursement and loans as follows:
15 (1)  The Controller shall transfer all weight fee revenues
16 deposited into the State Highway Account in any month to the
17 Transportation Debt Service Fund for transfer to the General Fund
18 as reimbursement for debt service costs until all of the debt service
19 paid on transportation bonds for projects that the Director of
20 Finance indicates qualify for reimbursement as provided for in
21 Section 16965 of the Government Code have been reimbursed.
22 (2)  After the Director of Finance has notified the Controller
23 that all debt service costs for the 2011–12 fiscal year have been
24 reimbursed, the Controller shall transfer any remaining monthly
25 weight fee revenues in the State Highway Account to the General
26 Fund as a loan until the full amount appropriated in this
27 subdivision has been transferred to the General Fund. This loan
28 shall be repaid by June 30, 2015.
29 (3)  By June 15, 2012, the Director of Finance in consultation
30 with the Treasurer shall notify the Controller regarding the final
31 amount of debt service paid from the General Fund during the
32 2011–12 fiscal year pursuant to Section 16965 of the Government
33 Code and shall direct the Controller to reverse and adjust any
34 transfers made as debt service reimbursements or loans so that a
35 maximum amount of transfers are made for debt service
36 reimbursements and with any loan amounts limited to the difference
37 between this amount and the total amount appropriated in this
38 subdivision. The total amount of weight fee revenues transferred
39 from the State Highway Account for the 2011–12 fiscal year shall

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1 not be greater than the total amount of weight fee revenues

2 deposited into the State Highway Account in that year.
3 (4)  With respect to transfers or portions of transfers that cannot
4 be made in any given month if weight fee revenues are insufficient,
5 the first weight fee revenues available in the following month or
6 months shall be used to complete the transfers for the previous
7 month or months prior to making additional transfers for later
8 months.
9 (c)  (1)  Starting with the 2012–13 fiscal year and every year
10 thereafter, all weight fee revenues deposited into the State Highway
11 Account in any month shall be transferred to the Transportation
12 Debt Service Fund for transfer to the General Fund by the
13 Controller as reimbursement for debt service costs until all of the
14 debt service paid on transportation bonds that the Director of
15 Finance indicates qualify for reimbursement as provided for in
16 Section 16965 of the Government Code have been reimbursed. By
17 June 15 of each year the Director of Finance in consultation with
18 the Treasurer shall notify the Controller regarding the final amount
19 of debt service paid from the General Fund during that fiscal year
20 pursuant to Section 16965 of the Government Code and shall direct
21 the Controller to reverse or adjust any transfers made as debt
22 service reimbursements so that a maximum amount of transfers
23 are made for debt service reimbursements. The total amount of
24 weight fee revenues transferred from the State Highway Account
25 in any fiscal year shall not be greater than the total amount of
26 weight fee revenues deposited into the State Highway Account in
27 that year.
28 (2)  With respect to transfers or portions of transfers that cannot
29 be made in any given month if weight fee revenues are insufficient,
30 the first weight fee revenues available in the following month or
31 months shall be used to complete the transfers for the previous
32 month or months prior to making additional transfers for later
33 months.
34 SEC. 41. Section 9552 of the Vehicle Code is amended to read:
35 9552. (a)  Whenever any If a vehicle is operated upon any a
36 highway of this state without the fees first having been paid as
37 required by this code, and those fees have not been paid within 20
38 days of its first operation, those fees are delinquent, except as
39 provided in subdivision (b).

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1 (b)  (1)  Fees are delinquent whenever if an application for

2 renewal of registration, or any an application for renewal of special
3 license plates, is made after midnight of the expiration date of the
4 registration or special plates, or 60 days after the date the registered
5 owner is notified by the department pursuant to Section 1661,
6 whichever is later.
7 (2)  Notwithstanding paragraph (1), commencing on June 8,
8 2011, fees are delinquent if an application for renewal of
9 registration, or an application for renewal of special license plates,
10 is made after midnight of the expiration date of the registration
11 or special plates, or 30 days after the date the registered owner
12 is notified by the department pursuant to Section 1661, whichever
13 is later. This paragraph shall become inoperative on January 1,
14 2012.
15 (c)  Whenever any If a person has received as transferee a
16 properly endorsed certificate of ownership and the transfer fee has
17 not been paid as required by this code within 10 days, the fee is
18 delinquent.
19 (d)  Whenever any If a person becomes an automobile dismantler,
20 dealer, manufacturer, manufacturer branch, distributor, distributor
21 branch, or transporter without first having paid the license and
22 special plate fees as required by this code, the fees are delinquent.
23 SEC. 42. Section 12811 of the Vehicle Code is amended to
24 read:
25 12811. (a)  (1)  (A)  When the department determines that the
26 applicant is lawfully entitled to a license, it shall issue to the person
27 a driver’s license as applied for. The license shall state the class
28 of license for which the licensee has qualified and shall contain
29 the distinguishing number assigned to the applicant, the date of
30 expiration, the true full name, age, and mailing address of the
31 licensee, a brief description and engraved picture or photograph
32 of the licensee for the purpose of identification, and space for the
33 signature of the licensee.
34 (B)  Each license shall also contain a space for the endorsement
35 of a record of each suspension or revocation thereof.
36 (C)  The department shall use whatever process or processes, in
37 the issuance of engraved or colored licenses, that prohibit, as near
38 as possible, the ability to alter or reproduce the license, or prohibit
39 the ability to superimpose a picture or photograph on the license
40 without ready detection.

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1 (2)  In addition to the requirements of paragraph (1), a license

2 issued to a person under 18 years of age shall display the words
3 “provisional until age 18.”
4 (b)  (1)  On and after July 1, 2011, an application for an original
5 or renewal driver’s license or identification card shall contain a
6 space for the applicant to enroll in the Donate Life California Organ
7 and Tissue Donor Registry. The application shall include check
8 boxes for an applicant to mark either (A) Yes, add my name to the
9 donor registry or (B) I do not wish to register at this time.
10 (2)  The department shall inquire verbally of an applicant
11 applying in person for an original or renewal driver’s license or
12 identification card at a department office as to whether the applicant
13 wishes to enroll in the Donate Life California Organ and Tissue
14 Donor Registry. Failure or refusal to answer this question or check
15 a box on the application form shall not be a basis for the department
16 to deny an applicant a driver’s license or identification card.
17 (3)  The following language shall be included with the question
18 required by paragraph (1):
19
20 “Marking ‘Yes’ adds your name to the Donate Life California
21 Organ and Tissue Donor Registry and a pink ‘donor’ dot will
22 appear on your license. If you wish to remove your name from the
23 registry you must contact Donate Life California (see back); DMV
24 can remove the pink dot from your licenses but cannot remove
25 you from the registry.”
26
27 (4)  The back of the application shall contain the following
28 statement:
29
30 “If, on the front of this form, you marked ‘Yes’ to register as an
31 organ and tissue donor you are legally authorizing the recovery of
32 organs and tissues in the event of your death. Registering as a
33 donor will not affect your medical treatment in any way. As
34 outlined in the California Anatomical Gift Act, your authorization
35 is legally binding and, unless the donor is under 18 years of age,
36 your decision does not require the consent of any other person.
37 For registered donors under 18 years of age, the legal guardian
38 shall make the final donation decision. You may limit your
39 donation to specific organs or tissues, place usage restrictions, for
40 example transplantation or research, obtain more information about

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1 donation, or remove your name from the registry on the Internet

2 We b site of Donate Life California:
3 www.donateLIFEcalifornia.org.”
4
5 (5)  Notwithstanding any other provision of law, a person under
6 18 years of age may register as a donor. However, the legal
7 guardian of that person shall make the final decision regarding the
8 donation.
9 (6)  The department shall collect donor designation information
10 on all applications for an original or renewal driver’s license or
11 identification card.
12 (7)  The department shall print the word “DONOR” or another
13 appropriate designation on the face of a driver’s license or
14 identification card to a person who has indicated on the application
15 his or her intent to enroll in the organ donation program pursuant
16 to this section.
17 (8)  On a weekly basis, the department shall electronically
18 transmit to Donate Life California, a nonprofit organization
19 established and designated as the California Organ and Tissue
20 Donor Registrar pursuant to Section 7150.90 of the Health and
21 Safety Code, all of the following information from every
22 application that indicates the applicant’s decision to enroll in the
23 organ donation program:
24 (A)  His or her true full name.
25 (B)  His or her residence or mailing address.
26 (C)  His or her year of birth.
27 (D)  His or her California driver’s license number or
28 identification card number.
29 (9)  (A)  A person who applies for an original or renewal driver’s
30 license or identification card may designate a voluntary
31 contribution of two dollars ($2) for the purpose of promoting and
32 supporting organ and tissue donation. This contribution shall be
33 collected by the department, and treated as a voluntary contribution
34 to Donate Life California and not as a fee for the issuance of a
35 driver’s license or identification card.
36 (B)  The department may use the donations collected pursuant
37 to this paragraph to cover its actual administrative costs incurred
38 pursuant to paragraphs (6) to (8), inclusive. The department shall
39 deposit all revenue derived pursuant to this paragraph and
40 remaining after the department’s deduction for administrative costs

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1 in the Donate Life California Trust Subaccount, that is hereby

2 created in the Motor Vehicle Account in the State Transportation
3 Fund. Notwithstanding Section 13340 of the Government Code,
4 all revenue in this subaccount is continuously appropriated, without
5 regard to fiscal years, to the Controller for allocation to Donate
6 Life California and shall be expended for the purpose of increasing
7 participation in organ donation programs.
8 (C)  The department shall transmit to the Donate Life California
9 Organ and Tissue Donor Registry and the appropriate policy and
10 fiscal committees of the Legislature an annual report, and shall
11 make available quarterly updates, detailing funds collected through
12 voluntary contributions as well as a summary of applicants,
13 including all of the following nonidentifiable information:
14 (i)  Date of application.
15 (ii)  Method of application (field office, online, or mail).
16 (iii)  Donor registration status.
17 (iv)  Zip code.
18 (v)  Gender.
19 (vi)  Year of birth.
20 (D)  (i)  The annual report to be submitted to the appropriate
21 policy and fiscal committees of the Legislature pursuant to
22 subparagraph (C) shall be submitted in compliance with Section
23 9795 of the Government Code.
24 (ii)  Pursuant to Section 10231.5 of the Government Code, the
25 requirement for submitting the annual report to the appropriate
26 policy and fiscal committees of the Legislature imposed under
27 subparagraph (C) is inoperative four years after the date the first
28 annual report is due.
29 (10)  The enrollment form shall be posted on the Internet Web
30 sites for the department and the California Health and Human
31 Services Agency.
32 (11)  The enrollment shall constitute a legal document pursuant
33 to the Uniform Anatomical Gift Act (Chapter 3.5 (commencing
34 with Section 7150) of Part 1 of Division 7 of the Health and Safety
35 Code) and shall remain binding after the donor’s death despite any
36 express desires of next of kin opposed to the donation. Except as
37 provided in paragraph (5) of subdivision (b), the donation does
38 not require the consent of any other person.
39 (12)  Donate Life California shall ensure that all additions and
40 deletions to the California Organ and Tissue Donor Registry,

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1 established pursuant to Section 7150.90 of the Health and Safety

2 Code, shall occur within 30 days of receipt.
3 (13)  Information obtained by Donate Life California for the
4 purposes of this subdivision shall be used for these purposes only
5 and shall not be disseminated further by Donate Life California.
6 (c)  (1)  All applications for a driver’s license or identification
7 card shall contain a space for an applicant to indicate whether he
8 or she has served in the Armed Forces of the United States and to
9 give his or her consent to be contacted regarding eligibility to
10 receive state or federal veterans benefits. The application shall
11 contain the following statement:
12
13 “By marking the veteran box on this application, I certify that
14 I am a veteran of the United States Armed Forces and that I want
15 to receive veterans benefits information from the California
16 Department of Veterans Affairs. By marking the veteran box on
17 this application, I also consent to DMV transmitting my name and
18 mailing address to the California Department of Veterans Affairs
19 for this purpose only, and I certify that I have been notified that
20 this transmittal will occur.”
21
22 (2)  The department shall collect the information obtained
23 pursuant to paragraph (1).
24 (3)  As mutually agreed between the department and the
25 Department of Veterans Affairs, the department shall electronically
26 transmit to the Department of Veterans Affairs the following
27 information on each applicant who has identified that he or she
28 has served in the Armed Forces of the United States since the last
29 data transfer and has consented to be contacted about veterans
30 benefits:
31 (A)  His or her true full name.
32 (B)  His or her mailing address.
33 (4)  Information obtained by the Department of Veterans Affairs
34 for the purposes of this subdivision shall be used for the purpose
35 of assisting individuals to access veterans benefits and shall not
36 be disseminated except as needed for this purpose.
37 (c)
38 (d)  A public entity or employee shall not be liable for loss,
39 detriment, or injury resulting directly or indirectly from false or

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1 inaccurate information contained in the form provided pursuant

2 to subdivision (b).
3 (d)
4 (e)  A contract shall not be awarded to a nongovernmental entity
5 for the processing of driver’s licenses, unless the contract conforms
6 to all applicable state contracting laws and all applicable procedures
7 set forth in the State Contracting Manual.
8 (e)  This section shall become operative on July 1, 2006.
9 SEC. 43. Of the amounts appropriated in Items 2665-004-6043,
10 2665-304-0890, 2665-304-6043, 2665-305-0890, and
11 2665-305-6043 of Section 2.00 of the Budget Act of 2010, a total
12 of fifty-five million three hundred twenty thousand dollars
13 ($55,320,000) shall be available for expenditure only after the
14 submittal of a report to the Joint Legislative Budget Committee
15 and a 30-day review period, or not sooner than whatever lesser
16 time the Chairperson of the Joint Legislative Budget Committee,
17 or his or her designee, may determine. The High-Speed Rail
18 Authority shall have discretion concerning how the fifty-five million
19 three hundred twenty thousand dollars ($55,320,000) in restricted
20 expenditures is allocated among the five items of appropriation
21 listed above. The authority shall submit the report no later than
22 February 14, 2011. The report shall include, but not necessarily
23 be limited to, all of the following:
24 (a)  A report on contract expenditures for community outreach,
25 including detail by type of expenditure and activity. Detail on
26 meetings by segment and community, and a summary of
27 correspondence, e-mail, media, Internet Web site, and other
28 outreach efforts shall be included in this report.
29 (b)  A copy of the strategic plan that the authority is developing
30 pursuant to the requirements of the State Administrative Manual.
31 (c)  A report on the performance of the program manager
32 contractor. The authority shall indicate all the measures it has
33 taken to address the findings and recommendations of the Bureau
34 of State Audits in its April 2010 report, how the authority evaluates
35 the performance of the contractor, and what those evaluations
36 suggest in terms of resolution to the deficiencies noted by the
37 Bureau of State Audits.
38 (d)  A report on how the authority has addressed other
39 recommendations of the Bureau of State Audits not otherwise
40 covered by this section.

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1 SEC. 44. Of the amounts appropriated in Items 2665-004-6043,

2 2665-304-0890, 2665-304-6043, 2665-305-0890, and
3 2665-305-6043 of Section 2.00 of the Budget Act of 2011, 25
4 percent of the total amount shall be available for expenditure only
5 after the submittal of a report to the Joint Legislative Budget
6 Committee and a 60-day review period, or not sooner than
7 whatever lesser time the Chairperson of the Joint Legislative
8 Budget Committee, or his or her designee, may determine. The
9 High-Speed Rail Authority shall have discretion concerning how
10 the 25 percent in restricted expenditures is allocated among the
11 five items of appropriation listed above. The authority shall submit
12 the report no later than October 14, 2011. The report shall include,
13 but not necessarily be limited to, all of the following:
14 (a)  A complete legal analysis of the revenue guarantee or other
15 mechanisms to reduce the operator’s risk that the authority
16 indicates it would provide to the operator. To mitigate risk, the
17 authority shall provide an analysis of the revenue contribution to
18 the project from the private operator with and without a revenue
19 guarantee or other mechanism to reduce the operator’s risk. The
20 authority shall discuss alternative financing approaches to make
21 up for any lost revenue in the case of no revenue guarantee or
22 other mechanisms to reduce the operator’s risk.
23 (b)  A financial plan update with alternative funding scenarios.
24 To mitigate risk, the authority shall report on alternative funding
25 options if no significant federal funds are received beyond the
26 federal American Recovery and Reinvestment Act of 2009 (Public
27 Law 111-5) and no revenue guarantee or other mechanisms to
28 reduce the operator’s risk are allowable. The plan shall also
29 include construction alternatives for a constrained funding
30 environment, including what investments would be made and
31 construction completed if the nonbond resources only equal bond
32 funding.
33 SEC. 45. The Director of Finance shall immediately notify the
34 Joint Legislative Budget Committee, the Executive Officer of the
35 Franchise Tax Board, the Executive Director of the State Board
36 of Equalization, and the Director of Motor Vehicles when and if
37 a ballot measure is approved, at a statewide election held during
38 the 2011 calendar year, that extends the vehicle license fee rate
39 increase that would otherwise become inoperative on July 1, 2011,
40 imposed pursuant to Part 5 (commencing with Section 10701) of

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1 Division 2 of the Revenue and Taxation Code and applicable to

2 vehicle registrations on or before June 30, 2011, to a date
3 subsequent to that date.
4 SEC. 46. This act addresses the fiscal emergency declared and
5 reaffirmed by the Governor by proclamation on January 20, 2011,
6 pursuant to subdivision (f) of Section 10 of Article IV of the
7 California Constitution.
8 SEC. 47. This act is an urgency statute necessary for the
9 immediate preservation of the public peace, health, or safety within
10 the meaning of Article IV of the Constitution and shall go into
11 immediate effect. The facts constituting the necessity are:
12 In order to meet the current and near-term financial
13 requirements of the state, it is necessary that this act take effect
14 immediately.
15 SECTION 1. It is the intent of the Legislature to enact statutory
16 changes relating to the Budget Act of 2011.

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