Reporting

January 09, 2014 by Justin Ewers

What will be in Governor Brown’s five-year infrastructure plan?


Governor Brown's budget proposal for 2014-2015 includes an additional $1.7 billion for transportation needs. (Photo Credit: Todd Plain, US Army Corps of Engineers/Flickr).

The governor’s hastily scheduled budget presentation today following the leak of his proposed budget (PDF) offered a glimpse of the administration’s long-awaited 5-year plan for investing in the state's aging infrastructure—with the budget emphasizing the need to spend nearly $65 billion in the coming years to maintain everything from the state's deteriorating local roads and highways to its long-neglected state parks and court buildings.

But while the governor’s budget proposal clearly outlines his spending plans for the year ahead—including a $1.7 billion boost in transportation funding and a new $815 million funding package aimed specifically at “deferred maintenance” projects—the 5-year plan itself, with its long-term outline of spending plans, has not yet been released. Department of Finance officials have said the plan will be posted on their website on Friday.

The proposed budget does demonstrate how Gov. Brown intends to make investments in infrastructure in at least the first year of his 5-year plan—putting spending on roads, rail, and water infrastructure in the same high-priority category as investments in education and health care.

“With a decade of intractable deficits behind us, California is poised to take advantage of the recovering economy and the tens of thousands of jobs now being created each month,” Brown said. “By finally addressing this backlog of deferred maintenance, the state will keep its assets functioning longer and reduce the need to build costlier new infrastructure."

With the administration’s long-term infrastructure plans still to be unveiled, here are some of the highlights of the governor’s infrastructure proposals for the year ahead—many of which align closely with the Summit Infrastructure action team’s own four-point plan:

Transportation: The budget boosts transportation funding with a $1.7 billion addition to current levels, including $300 million in “rail modernization” funds intended for the governor’s embattled high-speed rail project. Brown plans to pull these funds from three different sources: the state’s growing cap-and-trade program, the funds remaining from 2006’s Proposition 1B, and the proceeds of early loan repayments from the General Fund. (Several of these ideas were highlighted as top priorities by the Summit's Infrastructure action team in a December letter to Transportation Agency and Department of Finance.)

Water: The governor outlined plans for spending more than $600 million on water storage and water quality, but he said he would “reserve judgment” on whether a larger, $6.5 billion water bond should be put on the ballot. “Governors can’t make it rain,” he said, adding that he had formed a drought task force that was meeting today to determine how the state should address the serious drought now gripping much of California. “We’re going to do what we can do.” 

Local infrastructure: Several years after the controversial dissolution of local redevelopment agencies—a major bone of contention between the state and local leaders—the governor’s budget also includes a proposal to dramatically expand an existing economic development mechanism, Infrastructure Financing Districts (IFDs), to allow cities to invest in local infrastructure projects. The budget would expand the types of projects IFDs can current fund, while also lowering the vote requirement to create these local authorities and issue debt from two-thirds to 55 percent.

Deferred maintenance: In a nod to rising concerns about the state’s aging infrastructure systems—from potholed streets to crumbling school buildings—the budget also creates a new one-time $815 million package of funds intended just for deferred maintenance projects. The governor also hinted that further borrowing to pay for infrastructure projects may not be possible in the coming years, “given the state’s increased debt burden and General Fund constraints.” Michael Cohen, the director of the Department of Finance, said the administration’s new one-time funds were a first step toward paying for an estimated $65 billion worth of deferred infrastructure maintenance. “We’ve pieced together a package to try to get a handle on this—to catch up,” Cohen said today. “But clearly we have many years ahead of us before we’ll be able to eliminate that number.”

While we hope the 5-year plan will include more detail on the state’s strategies for closing this gap, here is a look at where the governor hopes to put money in the coming year:

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Categories: Infrastructure

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