Report 95014 Summary - February 1996

California Transportation Commission and Department of Transportation: The State's Use of Transportation Funds Generated By the 1989 Transportation Blueprint Legislation

This is the fourth report in a series of annual reports that we are required to submit by Chapter 16 of the Statutes
of 1990. The 1989 Transportation Blueprint Legislation (Transportation Blueprint) contains provisions increasing transportation taxes, fees, and bond proceeds and requires the State to allocate and spend these increased revenues (blueprint revenue) on specified transportation programs. Based on our review for fiscal year 1994-95, we found that although half of the ten-year Transportation Blueprint period has elapsed, the total revenues and expenditures are less than half of the total amounts anticipated by the legislation. Furthermore, we found that the revenue sources provided by the Transportation Blueprint may not produce the total revenue of $18.5 billion anticipated by the legislation. The potential shortfall includes $2 billion lost when voters rejected two $1 billion bond issues. Additionally, if fuel tax and commercial weight fee revenue collections continue for the next five years at the same rate as collections for fiscal year 1994-95, there will be an additional shortfall of approximately $1.4 billion for a total shortfall of approximately $3.4 billion.

We also found that the projects we examined are included in the specified transportation programs and adhere to statutory requirements for their respective programs. In addition, the California Transportation Commission (commission) allocated the blueprint revenue in accordance with applicable program statutes and guidelines. Further, the State spent the blueprint revenue in accordance with statutory requirements and correctly calculated its formulabased disbursements of these funds to cities and counties. Included in the allocations and expenditures were state matching and exchange funds authorized by the Streets and Highways Code, Sections 182.6(g) and (h) and 182.9. These sections do not specify whether blueprint revenues or other state revenues are to be used for the match and exchange.