STAFF REPORT

SUBJECT: Funding Modification for Highway 101 Ellwood\Hollister Interchange project, Cold
Spring Canyon Bridge Suicide Barrier project and 101 Milpas to Cabrillo/Hot
Springs project

MEETING DATE: July 16, 2009 AGENDA ITEM: 6C

STAFF CONTACT: Jim Kemp or Steve VanDenburgh

RECOMMENDATION:

1. Approve an exchange of STIP, SHOPP and federal stimulus funding to facilitate the
delivery of the Highway 101 Ellwood\Hollister interchange project.

2. Authorize the Chairman and Executive Director to sign cooperative agreements and
certifications to implement the funding modification.

SUMMARY:

The $12.5 million Highway 101 Ellwood\Hollister interchange project will be ready for
construction at the start of the 09/10 fiscal year. The project has significant local benefits, and
SBCAG, the city of Goleta and Caltrans are all funding partners. However, a delay in SBCAG’s
STIP funding due to the state budget crisis has placed the schedule of the project in jeopardy.
STIP funds represent approximately 15% of the construction budget. To bypass the problem,
Caltrans has proposed a three-way trade of funding that will result in SHOPP funding replacing
STIP funding, thus allowing the project to move forward as scheduled. SBCAG staff supports
the recommendation, and TTAC unanimously supported the recommendation at its June 4
meeting. A cooperative agreement will have to be signed between Caltrans and SBCAG to
effectuate parts of the trade. Staff recommends that the board authorize the chairman and
executive director to sign the agreement when drafted by Caltrans to ensure that the project
moves forward as expeditiously as possible.

The board unanimously approved these recommendations at its meeting in June. Some
members of the public, however, have alleged that SBCAG failed to properly notice the agenda
item in violation of the Brown Act. County counsel has reviewed the board actions and the June
18 agenda noticing these actions and found that no violation of the Brown Act has occurred.
Staff is recommending, however, that the item be re-heard by the board to address the
concerns expressed by some members of the public.

DISCUSSION:

The Highway 101 Hollister Ellwood interchange reconstruction is a partnership project between
SBCAG, the city of Goleta and Caltrans. All of the partner agencies are contributing funding to
the project’s construction budget which is estimated at $12.5 million, including construction
support. The SBCAG board has programmed $1.848 million from our county share of State
Transportation Improvement Program (STIP) funding for construction. This is leveraging over
$10 million in federal bridge funding and Caltrans SHOPP funding into the county.

The impetus for the project is the replacement of the Hollister Avenue bridge over Highway 101
which is owned by the State. The bridge is suffering from deteriorating aggregate which is
compromising the integrity of the structure. Caltrans could have limited the project scope to
replacing the bridge on its current alignment to expeditiously eliminate this state liability. But
they volunteered to be the lead agency for a more expansive project which addresses other
deficiencies at the interchange that also will benefit the local community. These include moving
the interchange and bridges over UPRR and the highway to the east to align with Cathedral
Oaks Road. This will eliminate the need for vehicles, bicycles and pedestrians to use a very
narrow section of Calle Real west of Cathedral Oaks. The UPRR bridge, referred to as the
Ellwood Overhead bridge, is owned by the city of Goleta and also suffers from deteriorating
aggregate, so replacement of the bridge as part of the project is a benefit to the city. Caltrans
also agreed to build into both bridges bicycle and pedestrian facilities. The current bridges have
no sidewalks or bike lanes and are a real challenge to navigate for non-motorists. The project
has a completed environmental document, final design is finished, and a coastal development
permit has been issued. The project will be ready to go out to bid early in the 09/10 fiscal year.
To be able to leverage federal bridge and SHOPP funds and Caltrans expertise and lead
agency services for all of these improvements with a relatively small amount of STIP and city
funds has been an excellent deal for Goleta and SBCAG.

The challenge the project is facing is that the State budget crisis has halted allocations of STIP
funding for projects. The California Transportation Commission has indicated that for an
indefinite period, until they have more clarity on the State budget crisis, they will not be
allocating regional STIP funds for projects. So unless a substitute funding source is found the
project will be indefinitely delayed due to a lack of STIP funding, which is approximately 15% of
the construction budget.

At the May SBCAG board meeting, Councilman Bennett of Goleta expressed concern that
delaying the project would mean delaying the replacement of deficient structures, forgoing an
opportunity to create construction jobs at a time when job creation is needed, missing out on a
favorable bidding climate, and delaying follow-up improvements the city of Goleta would make
when the project is done including constructing a new fire station adjacent to the reconstructed
interchange. He requested that Caltrans and SBCAG staff try and find a way of bypassing the
STIP funding delay.

Caltrans has proposed a solution to replace the delayed STIP funds by trading funding between
three projects. The trade is described in Attachment #1, a staff report and diagram Caltrans
prepared for TTAC. They propose that SBCAG approve trading the $1.848 million in STIP
funding from Ellwood\Hollister to the Highway 101 Milpas\Hot Springs project to serve as the
project’s reserve, trading that project’s $1.5 million stimulus funding reserve the board created in
February to the Cold Spring Bridge project, and trading the Cold Spring project’s SHOPP
funding to the Highway 101\Ellwood\Hollister interchange project. Caltrans would add cost
savings from other SHOPP projects to the Ellwood\Hollister project to fully close the shortfall on
that project resulting from trading away the STIP funds.

SBCAG staff supports this recommendation. The proposed funding trade would help ensure
timely delivery of two projects supported by SBCAG—the Elwood/Cathedral Oaks interchange
and the Cold Spring bridge—and it would protect a reserve for the Milpas project that could be
drawn upon if the project is again threatened with a work stoppage.
The qualifiers to the trade that the board should be aware of are that the trade would replace the
$1.5 million federal stimulus reserved for the Milpas project with a $1.848 million reserve in
currently delayed STIP funds. The stimulus funds were reserved for the project by the board in
February when the State budget crisis affected the sale of Prop 1B general obligation bonds,
which are being used to fund construction. If the State couldn’t find buyers for its bonds, and
threatened to shut down the Milpas project due to a lack of state cash, the federal stimulus
funding could have been used as substitute funding (probably for a month, given the rate of
construction spending on Milpas) until bond sales hopefully resumed. The Department of
Finance has indicated that, since February, it has been able to sell a sufficient amount of bonds
to fund Prop 1B projects like Milpas through the 09/10 fiscal year. Staff recommends continuing
to hold the reserve funds until the 10/11 fiscal year, when the state may again experience a
budget crisis and inability to sell bonds. By that time, the suspension of STIP funds allocations
should be lifted, and funds would be available for use on the project. Since stimulus funds have
to be obligated by October 15 (deadline set by the SBCAG board) or February of 2010 (state
deadline), they are of no use as a reserve for the 10/11 fiscal year, and staff would have
recommended that the stimulus reserve funding be traded for other funding that could serve as
a reserve for next fiscal year. The funding trade proposed by Caltrans would accomplish this.

Since the Cold Spring project will be ready for construction by the end of this calendar year, the
stimulus funds should be obligated on that project in a timely manner. SBCAG staff will monitor
the Cold Spring project’s progress and, if there are any delays to the project that could cause
the stimulus funding to not be obligated in a timely manner and be in jeopardy of lapsing, staff
will recommend alternative local projects that the funds could be reprogrammed to that could
quickly obligate the funding.

The use of regional stimulus funds from SBCAG on the Cold Spring Bridge rather than Caltrans
SHOPP funds will require that Caltrans and SBCAG sign a cooperative agreement. Staff
recommends that the board grant the Chairman and Executive Director the authority to the sign
cooperative agreements necessary to effectuate the transfer of funds as recommended by staff
in this report and shown on attachment #1 of the Caltrans staff report.

RECOMMENDATION

1. Approve an exchange of STIP, SHOPP and federal stimulus funding to facilitate the
delivery of the Highway 101 Ellwood\Hollister interchange project.

2. Authorize the Chairman and Executive Director to sign cooperative agreements and
certifications to implement the funding modification.

COMMITTEE RECOMMENDATIONS:

TTAC supported the recommendation unanimously at its June 4 meeting.

In February, TTAC recommended to the board as part of the first allocation of stimulus funding
that any stimulus funding held in reserve for the Milpas project be divided amongst local
agencies by population if not needed for the Milpas project. The board reserved the $1.5
million in stimulus funds for Milpas but did not take any action to allocate the funds if they are
not needed for Milpas. TTAC members thought it was important to remind the board of its
previous recommendation. [A vote on how to use the reserve funding by the board is not
necessary at this time since staff is recommending holding a reserve, in the form of STIP
funding, through FY 10/11.]
ATTACHMENTS

#1 Caltrans staff report to TTAC

a. Funding exchange diagram
b. Attachment B – Ellwood Hollister Interchange Diagram
STATE OF CALIFORNIA-------BUSINESS, TRANSPORTATION AND HOUSING AGENCY ARNOLD SCHWARZENEGGER, Governor

DEPARTMENT OF TRANSPORTATION
50 HIGUERA STREET
SAN LUIS OBISPO, CA 93401-5415
PHONE (805) 549-3111
FAX (805) 549-3329
TDD (805) 549-3259 Flex your power!
http://www.dot.gov/dist05 Be energy efficient!

Staff Report

SUBJECT: Funding Modifications for Ellwood/Hollister Interchange Project

TTAC MEETING DATE: June 4, 2009 TTAC Agenda Item: 8

STAFF CONTACT: Tim Gubbins, Department of Transportation, District 5, 805-549-3065

RECOMMENDATION:

Recommend the SBCAG board approve an exchange of STIP, SHOPP and federal stimulus funding to
facilitate the delivery of the Highway 101 Ellwood\Hollister interchange project.

BACKGROUND:

The Highway 101 Ellwood\Hollister project involves replacing the Ellwood overhead at the Union
Pacific Railroad (UPRR) in conjunction with the relocation and reconstruction of the Highway
101/Hollister Avenue interchange in the city of Goleta. The strategy for rehabilitation and restoration of
the two structures is replacement. The Ellwood/Hollister construction cost estimate, including support, is
$12.5 million, funded with $1.848 million in State Transportation Improvement Program (STIP) funds
from SBCAG, $.157 million from the City of Goleta, $6.423 million in federal Highway Bridge Program
(HBP) funds and $4.097 million from Caltrans’ SHOPP. Project PS&E is complete, right of way
certified, and a coastal development permit has been issued. Caltrans is finalizing the Construction and
Maintenance agreement with UPRR. The project will be ready to list in June. The STIP funding
allocation vote by the California Transportation Commission was scheduled for June.

DISCUSSION:
At its last meeting, the California Transportation Commission indicated that, starting in June, they would
delay the allocation of STIP funds indefinitely due to the State budget crisis. This would delay the
delivery of the project at a time when there is a favorable bidding climate and would impact the
environmental permitting on the project which, among other things, requires noise-intensive construction
activity to be done outside of bird nesting season.

At the May 21, 2009 SBCAG Board meeting, Goleta Councilman Michael Bennett expressed concern
about the possible delay in the allocation of STIP construction funds for the project. In response to
Councilman Bennett’s concerns, both Caltrans and SBCAG staff promised to work together to find
funding options that would keep this project moving forward. Attached is a diagram of how funds could
be exchanged with other projects to deliver the project.

Tim Gubbins, Deputy Director, Caltrans District 5, is scheduled to attend the TTAC meeting and explain
the proposal.

Attachment: A - Funding Modification Proposal

B – Project Layout

“Caltrans improves mobility across California”

 Funding Modification Proposal for
EAs 05-0M140, 05-44780 & 05-0P910

The California Transportation Commission will not vote STIP funds at their June 2009
meeting. Therefore, the following funding modification to these three EAs is proposed to
fully fund the Ellwood Overhead project, EA 05-0M140. This project is combined with
the Hollister Overcrossing, EA 05-37150, under EA 05-0M14U for construction. EA 05-
37150 is funded by the 2008 SHOPP. The combined project cannot proceed without 05-
0M140 being fully funded.

The Ellwood overhead currently has $1,848,000 in STIP funding programmed for
construction and construction support from the 2008 STIP. SBCAG has set aside
$1,500,000 in federal ARRA (stimulus) funds as a reserve for the Milpas to Hot Springs
Operational Improvements contract. The Cold Springs Bridge project currently has
$1,500,000 programmed in the 2008 SHOPP for construction and construction support.
A shift in funds between the three projects with FY 2009 SHOPP savings from other
projects, as shown below, should be sufficient to deliver the Ellwood Overhead based on
current cost estimates. Full funding for all three projects is maintained including
replacement of the reserve funds for the Milpas to Hot Springs project.

Project A
Ellwood Overhead
Other SHOPP savings SB-101-26.5/27.1
Capital $118k EA 05-0M140
Support $230k
(Needed asap)
STIP Funds
Capital $1,618k
SHOPP Funds Support $230k
Capital $1,500k (Replace ARRA reserve)
(Needed asap)

Project C Project B
Cold Springs Canyon Milpas to Hot Springs
Bridge Suicide Barrier Op Improvements
SB-154-22.9/23.1 SB-101-10.8/12.8
EA 05-0P910 EA 05-44780
ARRA (stimulus) Funds
Capital $1,500k
(Needed by 12/2009)
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