Austin-San Antonio Intermunicipal Commuter Rail District Board Meeting

Friday, June 2, 2006
9:00am

San Marcos Activity Center
501 E. Hopkins
San Marcos, Texas

1. Call to Order

   Notice was duly posted and a meeting of the Austin-San Antonio Intermunicipal Commuter Rail District was held on Friday, June 2, 2006. Chairman Covington called the meeting to order at approximately 9:20am.

   Participants:

   • Sid Covington, Chair
   • Tullos Wells, Vice-Chair
   • Tommy Adkisson
   • Lisa Birkman
   • Mary Briseño
   • Mariano Camarillo
   • Patty Eason
   • Fred Harless
   • Dave Marsh
   • Al Notzon
   • Richard Perez
   • Carroll Schubert
   • John Thomaides

   Other participants included Ross Milloy, Bill Bingham, Alison Schulze, Clif Davis, Tom Shelton, Bill Woodford, Pat Coleman, and Craig Hoshijima.

2. Chairman and Member Comments

   Chairman Covington thanked the Board and the audience for attending, and welcomed special guests: Gary Nelon, Mayor, City of Georgetown; Paul Brandenburg, Georgetown City Manager; Jim Briggs, Georgetown Assistant City Manager; Ed Polasek, Georgetown long-range planner; Sheryl Sculley, San Antonio City Manager; and Wilda Won, TxDOT. Mr. Covington explained that the meeting would be a workshop format and standard agenda items would be postponed until the next meeting so that the Board could focus on starter projects and financing strategies.

   Chairman Covington directed the Board’s attention to a sample resolution in support of the Texas Rail Relocation and Improvement Fund, included in the agenda packet in response to Board members’ request at the May Board meeting, for each member to use and revise as necessary. Commissioner Adkisson suggested that Board members reach out to various local entities and organizations and emphasize the need to approve resolutions and support State funding of the Rail Relocation and Improvement Fund.

3. Consider and Take Appropriate Action on Consultant(s) for Federal Legislative Assistance

   Dave Marsh, Chair of the Proposal Evaluation and Selection Committee, reported to the Board that after considering five proposals for Federal Legislative Assistance, the Committee (comprised of Commissioner Adkisson, Councilmember Thomaides, and Dave Marsh) recommends that the Board award the contract to Smith Dawson and Andrews—the District’s current legislative consultant, for the remainder of the fiscal year, which ends September 30, 2006. Bill Bingham noted that the Committee also recommended authorizing the Executive Director to negotiate and execute a contract with Smith Dawson Andrews not to exceed $50,000. Vice-Chairman Wells made a motion to approve the Committee’s recommendations, which was seconded by Councilmember Perez. The Board unanimously approved the motion, with Carroll Schubert abstaining.

4. Report on Status of Phase 3 (TOD-based) Ridership Results

   Clif Davis, Project Director of the Planning & Preliminary Engineering Team, introduced the presentation on Phase 3 ridership with a recap of ongoing issues for the benefit of new Board members and guests. Mr. Davis provided a brief verbal summary on the status of negotiations to access Union Pacific’s right-of-way, the Federal Transit Administration (FTA) New Starts process and the Board’s decision to defer the June 30th submittal of a New Starts application, opportunities for alternative federal funding, the Texas Rail Relocation Fund, and the District’s ridership studies. Each issue is a component of implementing the commuter rail project and each affects the project’s funding—the primary topic of today’s workshop.

   Bill Woodford and Pat Coleman, AECOM, gave an overview of the three-phase ridership studies performed to date: Phase 1, completed in 2004, for the 2004 Feasibility Study Update; Phase 2, completed in May 2006, developed in compliance with current FTA New Starts regulations; and Phase 3, recently completed, which assumes significant transit-oriented development (TOD) in the vicinity of the stations and travel acceptance of commuter rail equivalent to that in cities with existing commuter rail service. Mr. Woodford reiterated that the Phase 3 results are not based on current FTA rules for ridership modeling and cannot be used for purposes of a New Starts submittal.

   The Phase 3 forecast results show a range of average annual ridership in the year 2030 as follows:

   • Downtown Austin to Downtown San Antonio: 1,150,500 – 1,178,000
   • Round Rock to San Marcos: 2,095,200 – 2,134,700
   • San Marcos to Downtown San Antonio: 572,300 – 573,700
   • Georgetown to KellyUSA: 3,240,400 – 3,281,600

   A brief discussion followed on TOD impacts, ridership projections compared with other systems, tools that drive ridership (e.g., density, connectivity, marketing), and the importance of seamless connections between modes at the stations. The final report on the Phase 3 ridership results will be complete by the end of June.

5. Consider and Discuss Options and Criteria for Starter Project

   Clif Davis and Tom Shelton, Carter & Burgess, presented eight possible options for small starter projects that could be locally funded as an alternative to the federal New Starts program. The starter projects range in length from 15-29 miles, and cost $100-160 million. The advantages of a starter project are two-fold: to develop a track record of ridership and operations with a starter line and then pursue New Starts funding for future extensions of the system, and to implement service early while negotiating with Union Pacific on access to the entire corridor. The starter project would be the first step toward implementing the entire 112-mile system.

   The Board commended Carter & Burgess for offering options outside the FTA program. Fred Harless noted that Capital Metro is funding its starter line with local funds and FTA has agreed to recognize the local funds spent on the starter line as Capital Metro’s match for future New Starts grants. Since the local funds could be used as the local match for the future extensions, all Rail District members will benefit from a small locally funded starter line. Chairman Covington noted that as the Board considers local financing strategies in agenda item 7, the Board needs to realistically look at phasing the 112-mile project.

6. Consider and Discuss Federal Railroad Administration (FRA) Funding Program

   Ross Milloy noted that FTA’s New Starts program doesn’t recognize the impact of NAFTA trade in the Austin-San Antonio Corridor, the importance of I-35 as a national trade corridor, and the need for transportation alternatives in the corridor. In addition to the FTA program, he is exploring FRA and FHWA programs, which would allow the District to use a cross-disciplinary approach to raise the profile of the corridor. Mr. Milloy distributed a report released by the U.S. Department of Transportation, National Strategy to Reduce Congestion on America’s Transportation Network (May 2006), and said he would continue to pursue all funding avenues.

7. Consider and Give Direction on Local Financing Strategies

   Craig Hoshijima, Public Financial Management (PFM), presented information on local-share cost allocation methods used throughout the country and potential methods to allocate the Rail District’s project costs to local jurisdictions. There are 22 commuter rail systems in the U.S. and the methods used to allocate costs vary widely from simple population-based formulas to complex cost-of-service methods. Typically, the unique characteristics of a system (e.g., route configuration, ridership patterns, funding sources, number of agencies) dictate how the costs are split, and different methods are used to allocate initial capital costs and ongoing operating costs. Mr. Hoshijima highlighted 8 commuter rail systems and reviewed the unique characteristics and cost allocation of each system. He then presented 5 methods to allocate local costs among Rail District jurisdictions: rail miles, city population, county population, station locations, and boardings.

   A lengthy discussion ensued. Board members discussed the viability of tax increment financing (TIF) as a funding source. TIF revenue projections are encouraging; but, as a funding mechanism, TIF revenue is uncertain—the Rail District needs to identify existing revenue sources for initial capital costs along with a cash flow schedule. The cities and counties could use TIFs as a basis for a revenue stream over time and a bonding program.

   The funding allocation formula must be equitable for all of the entities in the District. Equity should be tied to access and use, and local jurisdictions should resolve to work together in good faith for the benefit of the region.

   Members discussed the need to identify sources for the project’s initial capital costs, which would then allow members to realize TIF revenue. The challenge is to find the initial $100-$150 million in local funds to build a starter segment, and to identify each community’s fair share. Building the rail project is a public investment, just like roads and other transportation infrastructure. If local governments aren’t willing to make the investment, economic activity in the corridor will move elsewhere. Board members agreed that the Rail District needs to identify the starter project and the capital cost of the project, allocate the cost to local governments and, once the project and the cost are clearly defined, obtain local funding commitments.

   The Board directed the consultants to develop more detailed information on a short list of viable starter projects (target cost about $150 million), project costs (capital costs, operating costs, shared overall project costs, and segment-specific local costs), and funding formulas for the starter segment. The consultants will present the information to the PMO Committee. The PMO Committee will then recommend to the full Board 2 or 3 starter projects and 2 or 3 formulas to allocate local costs.

   The Board also directed staff to execute the appropriate contract amendments to allow the consultants to perform the additional work to be presented to the PMO Committee.

8. Public Comment

   There was no public comment.

9. Adjourn

   Chairman Covington thanked Board members, special guests, and the audience for their attendance and participation. There being no further items, the meeting adjourned at 11:45am.

Austin-San Antonio Intermunicipal Commuter Rail District Board Meeting

Friday, May 5, 2006
10:00am

AACOG Conference Room
8700 Tesoro
San Antonio, Texas

1. Call to Order

   Notice was duly posted and a meeting of the Austin-San Antonio Intermunicipal Commuter Rail District was held on Friday, May 5, 2006. Chairman Covington called the meeting to order at approximately 10:15am.

   Participants:

   • Sid Covington, Chair
   • Fred Harless Tullos Wells, Vice-Chair
   • Al Notzon
   • Tommy Adkisson
   • Richard Perez
   • Mary Briseño
   • Carroll Schubert
   • Mariano Camarillo
   • John Thomaides
   • Patty Eason

   Other participants included Ross Milloy, Bill Bingham, John Langmore, Clif Davis, and Craig Hoshijima.

2. Chairman and Member Comments

   Chairman Covington thanked the Board and the audience for attending, and noted that it was Cinco de Mayo. Mary Briseño welcomed two members of the VIA Board of Trustees, Eddie Herrera and Rick Pych, and thanked them for attending.

   Patty Eason reported that the Georgetown City Council passed the first reading of a transit oriented development (TOD) amendment to the City’s land use plan, and expect to approve the amendment on May 9, 2006. Ed Polasek of the City of Georgetown Planning Department briefed the Board on the City’s TOD amendment.

   John Thomaides commented that the City of San Marcos is following Georgetown’s lead in developing a master plan for the downtown area of San Marcos, which will emphasize transit- oriented development.

   Chairman Covington directed the Board’s attention to a letter dated May 4 that was sent to Bob Daigh, District Engineer, TxDOT Austin District. Mr. Covington explained that TxDOT is working on methods to expand the MoPac freeway—the corridor in which the Union Pacific right- of-way is located in central Austin. TxDOT recently hired consultants to start a major investment study and preliminary planning. The Rail District’s consultants met with TxDOT’s consultants on the MoPac study, which prompted the letter reminding TxDOT that the CAMPO 2030 Plan requires that TxDOT coordinate any work performed on MoPac with the Rail District and that TxDOT cannot preclude the use of rail in the corridor.

3. Report on Status of Appointments to the Board and Administration of Oath of Office to Newly Appointed Board Members

   Chairman Covington reported that no changes have occurred on the Board since the previous Board meeting.

4. Consider Approval of April 7 Board Meeting Minutes

   On a motion by Richard Perez and second by Patty Eason, the April 7 Board meeting minutes were approved unanimously.

5. Report on Status of Texas Rail Relocation Plan

   John Langmore, former staff director for the Texas House Transportation Committee, reported on the status of the Texas Rail Relocation and Improvement Fund (RRIF), which was approved as a constitutional amendment in November 2005. The RRIF doesn’t have a funding source as yet, but it is anticipated that in 2007 the State Legislature will dedicate a revenue source that can be bonded. The RRIF can be used to relocate, construct, acquire, improve, and rehabilitate either public or private rail facilities, although funding requirements for a public rail line are less stringent than funding requirements for a private facility.

   Mr. Langmore outlined requirements for rail relocation projects: relocation projects must be included in TxDOT’s strategic plan on the relocation fund, must be approved by the metropolitan planning organizations, must be approved by a majority of the cities and counties in which the new line is located, and funding can only be used on overpasses and underpasses that are part of the relocation.

   In 2007 TxDOT will ask the Legislature to allocate $200 million per year to the RRIF, which would allow approximately $2 billion of bonds. It is incumbent that agencies like the Rail District support upcoming legislation to dedicate revenue sources to the fund.

   After a brief discussion, Chairman Covington suggested that all members of the Rail District adopt resolutions in favor of funding the Rail Relocation Fund, and forward the resolutions to the State Legislature prior to the next session, which starts in January 2007. Ross Milloy stated that the District would draft and circulate a standard resolution that could be used by member cities and counties.

6. Committee Reports

   1. Program Management Oversight Committee Meeting
      May 1, 2006

      Mariano Camarillo, PMO Committee Chair, directed the Board’s attention to a summary of the May 1 PMO Committee meeting in the agenda packet and stated that the Committee had discussed FTA coordination and issues; received a report from Public Financial Management (PFM) on local funding strategies, which will be presented to Board under item 7; received an update on the ridership models and discussed the FTA New Starts project application, which will be presented to the Board for action under item 8; and discussed the Rail District’s participation in VIA’s study on the Westside Multimodal Center. Chairman Camarillo asked Clif Davis, Project Director for the Planning & Preliminary Engineering (P&PE) Team, to brief the Board on the ridership studies.

      Clif Davis reported that the Phase 2 ridership model has not yielded a project that meets FTA thresholds. The P&PE Team continues to fine tune the model and coordinate with FTA and TxDOT, but FTA regulations have gotten more restrictive over the past year. The model is constrained on rail versus bus ridership preference and the impact of proposed transit oriented development. These constraints have reduced ridership projections. FTA is considering changing its rules to allow the preference factor, but the rules have not changed yet.

      Mr. Davis stated the Ridership Technical Advisory Committee—comprised of technical experts from the two MPOs, the two transit authorities, TxDOT, and Texas Transportation Institute—will reconvene in May. The Ridership TAC has reviewed and endorsed the model methodology, and will be asked to review the Phase 2 results and the model inputs—in particular, the bus networks.

      The Phase 3 model results, which are based on assumptions about transit oriented development and higher density around rail stations will be presented at the June Board meeting.

      Mr. Davis reiterated, in response to a question from Vice Chair Tullos Wells, that regardless of whether or not the Rail District submits a project for FTA New Starts funding, the work done to date—ridership studies, conceptual engineering, station design, economic impact analyses—is useful and provides essential data the Rail District will need as it seeks local, state and federal participation. The P&PE Team will report within the next 30 to 60 days whether the District should submit a New Starts application.

      Following a brief discussion by the Board on the New Starts process, Chairman Camarillo reminded the Board that the P&PE Team was previously directed to complete a New Starts application by June 30. The PMO Committee recommends that the Rail District defer the New Starts application and that the P&PE Team continue to refine the ridership model. Board Chair Covington stated that the Board would take action under agenda item 8.

7. Consider and Take Appropriate Action on Local Financing Strategies

   Craig Hoshijima of Public Financial Management (PFM) presented information on local funding strategies and sources. Mr. Hoshijima identified project costs (capital, operating, and debt service) for the full 112-mile system, available grant funding sources (federal, state, and regional), annual local funding requirements for the project, cost allocation methodologies (boardings, rail miles, population, stations), projected annual capital and operating costs, potential new funding sources, and projected revenue from transit oriented development and tax increment financing districts. The key decision for the Board is to select a method to allocate local costs.

   Chairman Covington reiterated that the Board needs to provide direction to PFM and make a policy decision on how to allocate local costs. Following Board discussion on allocation options, Tommy Adkisson made a motion, seconded by John Thomaides, to conduct a Board work session on June 2nd—in place of the regular Board meeting—to focus on local funding allocations and strategies. The motion was approved unanimously. The Board also directed the Executive Director to execute a contract, not to exceed $15,000, for an independent analysis of capital cost estimates for the project.

8. Consider and Take Appropriate Action on FTA New Starts Federal Project

   Chairman Covington directed the Board’s attention to the earlier discussion on the New Starts application under agenda item 6. On a motion by Fred Harless and a second by Richard Perez, the Board unanimously approved deferring the June 30, 2006 submittal of the FTA New Starts application in order to carry out additional studies. Bill Bingham noted that the Rail District still does not have an agreement with Union Pacific on use of the right-of-way, which is an additional reason to delay the New Starts submittal.

9. Financial Report

   Ross Milloy provided two financial reports for the Board’s information:

   • 2006 first quarter statement of income and billable expenses
   • Reconciliation detail of checking account, period ending May 4, 2006

10. Legislative Update

    Ross Milloy reported that state legislation has been introduced that would eliminate the cap on the Rail District’s tax increment financing authority. The bill has been filed and is pending the Governor’s open call for additional bills during the special session. Senator Barrientos and Senator Wentworth agreed to co-sponsor the legislation.

11. Other Business

    Bill Bingham noted that on May 1, the PMO Committee recommended the Rail District participate in VIA’s Westside Multimodal Study, and the item was mentioned earlier under agenda item 6. Ross Milloy reported that the Rail District is participating in a joint study of the rail station in the Austin central business district and VIA is proposing a similar study in the San Antonio CBD; however, the scope of VIA’s study includes a number of items that are not relevant to the Rail District. The recommendation is that the District fund up to $25,000 of the study, that the Rail District serve as the fiscal agent for the study, but that VIA manage the study. Mr. Milloy stated there are several contracting issues still under discussion, but the Rail District’s participation would be capped at $25,000, the same level as the Austin study. On a motion by Al Notzon and a second by Tullos Wells, the Board unanimously approved contributing $25,000 to the study and authorized the Executive Director to work out the contracting details.

12. Public Comment

    Joanne Walsh commented that she would like Board agenda items be made available to the public prior to the Board meetings.

13. Adjourn

    Chairman Covington thanked the members and the audience for their attendance and participation. The meeting adjourned at 11:46am.