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Oral
Testimony of the Honorable Janice Hahn Member,
Los Angeles City Council Chairwoman,
Alameda Corridor Transportation Authority to
a Joint
Hearing of
the U.S.
Senate Environment
& Public Works Committee and Finance
Committee September 25, 2002
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Honorable Chairmen, and members of the joint Committees,
good morning, INTRODUCTIONWe are commonly called ACTA. ACTA is the public agency that built the Alameda Corridor, a
20-mile-long freight rail expressway linking the Ports of Los Angeles and Long
Beach to the rail yards near downtown Los Angeles. The project was monumentally
complex, running through eight different government jurisdictions in urban Los
Angeles County, requiring multiple detailed partnerships between public and
private entities, and presenting extensive engineering challenges.
One of the key partnerships that has been vital over the years has been with the United States Congress. We greatly appreciate the strong support you and your colleagues provided to ACTA in developing the innovative loan from the Department of Transportation. Indeed, the Federal Government by its $400 million DOT loan became the first financial partner in this magnificently successful project. We are particularly thankful for the strong leadership demonstrated by many of you in Congress including our two distinguished Senators, Dianne Feinstein and Barbara Boxer along with California Congressman Stephen Horn and Congresswoman Juanita Millender-McDonald. Without their vision and support it is unlikely the Alameda Corridor would be in operation today, strengthening the nation’s global economic competitiveness. Over the years there were MODEL
FOR SUCCESS The key to our success can be attributed to two major themes
that guided us throughout the planning, financing and construction of the
project: First is
multi-jurisdictional cooperation. The
Alameda Corridor is built on the partnerships forged between competitive public
agencies and between those agencies and the private sector.
We have demonstrated that governments can work together, and they can
work with the private sector, putting aside competition for the benefit of
greater economic and societal good. Second
is direct and tangible community benefits.
The Alameda Corridor provided direct community benefits in the form of
significant traffic congestion relief, job training and other programs.
We have proven that communities don't have to sacrifice quality of life
to benefit from international trade and port and economic activity. PROJECT
NEED AND PLANNING The volume of containers crossing the wharves doubled in the
1990s and last year reached more than 10 million 20-foot containers per year.
That figure is expected to exceed 36 million by the year 2020.
Last year, the ports handled more than $200 billion in cargo, or about
one-quarter to one-third of the nation's waterborne commerce.
This has had huge ripple effects in Southern California and across the
country in the form of jobs, tax revenues and general economic activity. In the early 1980s, there was growing concern about the
ability of the ground transportation system to accommodate increasing levels of
trade-related rail and truck traffic in the port area.
By 1989, the cities and ports of Los Angeles and Long Beach had joined
forces to form a joint powers authority that later became the Alameda Corridor
Transportation Authority. The agency then selected a preferred project: consolidating
four branch lines serving the ports into a 20-mile freight rail expressway that
is completely grade-separated, including a 10-mile-long 30-foot-deep trench that
runs through older, economically disadvantaged industrial neighborhoods south of
downtown Los Angeles. PROJECT
FINANCING AND FUNDING Our broad base of cooperation is also evident in the
project's unique finance plan, which draws revenue from a range of both public
and private sources. The linchpin of this funding plan was designation of the
Alameda Corridor as a "high-priority corridor" in the 1995 National
Highway System Designation Act. That
designation cleared the way for Congress to appropriate $59 million needed to
back a $400 million loan to the project from the U.S. Department of
Transportation. The collective assistance offered by federal, state and
local agencies and elected officials provided the base funding -- the leverage,
if you will -- for the biggest piece of our financing package -- more than $1.1
billion in proceeds from revenue bonds sold by ACTA. The bonds and the federal loan are being retired by corridor
use fees paid by the railroads. The Use and Operating Agreement between ACTA and Burlington
Northern and Santa Fe Railway and Union Pacific Railroad, approved in October
1998, is truly unprecedented. Never before had the competitive railroads
cooperated on a project to the extent that they did on the Alameda Corridor.
Like the ports, the BNSF and the UP put aside their rivalry to cooperate
on a project with positive economic implications at the national, regional and
local levels. In the end, funding for the Alameda Corridor came from
multiple public and private sources and resulted from bipartisan support.
The funding breaks down roughly like this: 46% from ACTA revenue bonds;
16% from the U.S. Department of Transportation loan; 16% from the ports; 16%
from California state and local grants, much of it administered by the Los
Angeles County Metropolitan Transportation Authority, and 6% from other sources.
PROJECT
CONSTRUCTION There are many reasons why our project stayed on schedule,
but at the top of the list are our permit facilitating agreements with corridor
communities and utility providers, and our decision to use a design-build
contract for the Mid-Corridor Trench. Before construction began, ACTA negotiated separate
Memoranda of Understanding with each city along the route, detailing expedited
permitting processes, haul routes for construction traffic and the protocol for
lane closures and temporary detours. By
agreeing in advance on these and other issues, we streamlined a complex
construction process and saved time and money. DIRECT
COMMUNITY BENEFITS One key to securing the MOUs and additional community
cooperation and support was to deliver on our promises of direct community
benefits. By eliminating more than 200 at-grade
railroad crossings, the Alameda Corridor is projected to reduce emissions from
idling trucks and automobiles by 54 percent, slash delays at railroad crossings
by 90 percent and cut noise pollution by 90 percent. Disadvantaged firms – known as DBEs – have earned
contracts worth more than $285 million, meeting our goal for 22 percent DBE
participation. §
The goal of our Alameda Corridor Job Training and
Development Program was to provide job training and placement services to 1,000
residents of corridor communities. We
exceeded that goal- almost 1,300 residents received construction
industry-specific job training, and of those 637 were placed in
construction-trade union apprenticeships. §
The Alameda Corridor
Conservation Corps provided life skills training to 447 young adults from
corridor communities, exceeding the goal of 385. THE
FUTURE The efficient movement of cargo through our nation's ports
and on our rail lines and highways is a critical issue not only in Southern
California -- which has the nation's two busiest ports -- but the nation as a
whole. The Alameda Corridor is
truly the backbone of an emerging trade corridor program in Southern California.
Already, others are following our lead, including governmental agencies
in Los Angeles, Orange, San Bernardino, and Riverside Counties who are building
grade-separation projects. In addition, ACTA and the California Department of
Transportation are working under an innovative cooperative agreement to develop
plans for a Truck Expressway that would provide a “life-line” link between Terminal Island at the Ports and
the Pacific Coast Highway at Alameda Street.
The Alameda Corridor Truck Expressway is intended to speed the flow of
containers into the Southern California marketplace. Environmental reports are
being prepared, and the project could be ready for approval as early as March
2003. At ACTA, we believe that by
restructuring our federal loan we can undertake this critical Truck Expressway
project without any additional federal financial support. IMPLICATIONS
AND RECOMMENDATIONS As your committees, the full Congress, and the U.S.
Department of Transportation begin the TEA-21 reauthorization process, including
the formulation of policies to address growing freight rail and truck traffic
congestion and other challenges posed by international trade, we respectfully
offer these policy recommendations, based on our experience with the Alameda
Corridor: §
The
planning and funding of intermodal projects of national significance, directly
benefiting international trade, should be sponsored at the highest levels within
the Office of the Secretary of Transportation. There should be a national policy establishing the linkage
between the promotion of free trade and support for the critical intermodal
infrastructure
moving goods to every corner of the United States.
Public-private partnerships do in fact work and should be promoted and
encouraged by federal transportation legislation.
§
A
specific funding category is needed to support intermodal infrastructure
projects, and trade connector projects. Consideration
should be given to new and innovative funding strategies for the maritime
intermodal systems, infrastructure improvements enhancing goods movement. §
The
Alameda Corridor project benefited from a Department of Transportation willing
to undertake risk and provide loan terms that were not available on a commercial
basis. This federal participation
gave private investors confidence in the project and made bond financing
possible. Most important, in my mind, is this:
The success of the Alameda Corridor has shown that federal investment in
trade-related infrastructure can benefit the economy without sacrificing
quality-of-life issues. Mr. Chairmen, once again, thank you for inviting me here
today. That concludes my remarks.
I would be happy to address any questions. |
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