Supplemental Agenda Item No. 34 Board of Directors Meeting January 9, 2019 10:30 a.m. Location: San Bernardino County Transportation Authority First Floor Lobby Board Room Santa Fe Depot, 1170 W. 3rd Street San Bernardino CA. 92410 DISCUSSION CALENDAR Transit 34. Metro Gold Line Foothill Extension Phase 2B Project Update That the Board, acting as the San Bernardino County Transportation Authority: A. Receive and file an update on the Metro Gold Line Foothill Extension Phase 2B Project. B. Provide direction to staff on the need to work with the Los Angeles Metropolitan Transportation Authority and the Southern California Regional Rail Authority to develop Diesel Multiple Unit Service to meet the transit and transit-oriented development needs in Montclair in case the Metro Gold Line Foothill Extension Phase 2B terminates west of the San Bernardino County/Los Angeles County line. This agenda item was made available after the posting of the agenda. Minute Action SUPPLEMENTAL AGENDA ITEM: 34 Date: January 9, 2019 Subject: Metro Gold Line Foothill Extension Phase 2B Project Update Recommendation: That the Board, acting as the San Bernardino County Transportation Authority: A. Receive and file an update on the Metro Gold Line Foothill Extension Phase 2B Project. B. Provide direction to staff on the need to work with the Los Angeles Metropolitan Transportation Authority and the Southern California Regional Rail Authority to develop Diesel Multiple Unit Service to meet the transit and transit-oriented development needs in Montclair in case the Metro Gold Line Foothill Extension Phase 2B terminates west of the San Bernardino County/Los Angeles County line. Background: The Metro Foothill Gold Line Phase 2B Project (Project) includes 12.3 miles of light-rail track construction primarily in Los Angeles County, except for 0.6 miles of construction in San Bernardino County, which contains the planned eastern terminus station at the Montclair Transit Center, as shown in Attachment A. The Los Angeles Metropolitan Transportation Authority (LA Metro) is responsible for the funding of the Project in Los Angeles County and the San Bernardino County Transportation Authority (SBCTA) is responsible for funding the portion in San Bernardino County. Through state legislation, the Foothill Gold Line Construction Authority (Construction Authority) was formed for the purposes of overseeing all design and construction contracts for completion of the Los Angeles to Pasadena Metro Gold Line as well as any future extension eastward to Claremont. In 2012, legislation was passed that extended the terminus further east to Montclair in San Bernardino County. In addition to being the responsible funding entities, as the County Transportation Commissions, LA Metro and SBCTA are responsible for planning of mass transit systems in our respective counties. On June 22, 2017, the LA Metro Board of Directors approved a Life of Project Budget for their portion of the Project in the amount of $1.41 billion and authorized execution of a Project Funding Agreement with the Construction Authority, including provisions to apply for $249 million in State Transit Intercity Rail Capital Program (TIRCP) funds as a LA Metro priority. In December 2018, LA Metro led the effort to submit a TIRCP grant for the remaining funding needed in Los Angeles County, $249 million, as well as the remaining funding needed in San Bernardino County, which was $41 million. The TIRCP grant application was successful with the award of $290 million, and the Construction Authority initiated the design-build procurement process to enter into a contract for design and construction of the Project. The Construction Authority recently completed the initial procurement process for award of the design-build contract. As reported to their Board on November 13, 2018, they shortlisted four teams, all of which had cost proposals substantially over the budget established in June 2017. Based on the two lowest cost proposals received, Construction Authority staff estimates an additional $570 million is needed to construct the Project to Montclair, and recommended a Entity: San Bernardino County Transportation Authority Board of Directors Agenda Item January 9, 2019 Page 2 phased approach to delivering the project while additional funding is secured. The Construction Authority Board approved moving forward with the phased approach to the project as identified in Attachment A, with the intent of delivering the initial phase to La Verne by 2024 and allowing two additional years to build the remaining phases to Montclair, with the final completion slated for 2028 instead of 2026. Construction Authority staff cited two main reasons for the high cost proposals: market saturation and exacerbated conditions such as high material costs, limited work force availability, and risk associated with building in the Metrolink Corridor. As currently planned, the Project will enter the Metrolink Corridor near the Pomona North Metrolink Station and requires removal and reconstruction of three miles of Metrolink rail infrastructure. SBCTA requested an updated estimate and rate of expenditure for the work in San Bernardino County in an effort to accurately define the revised funding needed. The Construction Authority advised us that they will not provide an update until after they receive the revised cost proposals from the design-build teams in May 2019. In the meantime, they advised us to expect a 30-40% increase. SBCTA anticipates the total estimated cost for delivery of the Project in San Bernardino County, including Advanced Conceptual Engineering and SBCTA Oversight, could increase from $74 million to $100 million based on the information provided by the Construction Authority, as well as applying a 6% escalation rate to the expenditures that are being delayed two years and allowing for a 10% increase to right-of-way acquisition. Prior to the cost increase, the work in San Bernardino County was fully funded with receipt of the $41 million of TIRCP funding earmarked for work in San Bernardino County and a combination of non-federal formula funding. It should be noted that the $100 million could be further refined up or down once the Construction Authority provides the requested cost information and after receipt of the best and final cost proposals from the design-build teams. The initial phasing now proposed includes an interim terminus at La Verne, which could be completed by 2024. The Construction Authority has identified three additional phases-- construction to Pomona North, then to Claremont, and finally to Montclair--based on future funding availability, but targeted for completion by 2028. The Construction Authority is required to complete a re-evaluation of the California Environmental Quality Act (CEQA) Environmental Impact Report (EIR) because they did not include potential project phasing in the original environmental clearance. They are currently going through the steps to complete a Supplemental EIR (SEIR). The public outreach process kicked off in December 2018, adding the four phases as identified in Attachment A, while also proposing to move a parking lot at the Pomona North Metrolink Station The TIRCP grant criterion focuses on greenhouse gas reduction as well as benefits to disadvantaged communities. As such, the introduction of phasing calls into question the availability of the full amount of TIRCP awarded. However, on December 6, 2018, the LA Metro Board unanimously approved a motion to reiterate their support of the full Project, directed staff to come back in January with a proposed funding plan, and oppose the introduction of any new service in the Gold Line Corridor (included as Attachment B). SBCTA staff is concerned the Project may not receive the additional funding necessary to build to Montclair. We also harbor concerns with duplication of transit services in the same corridor where they are publicly subsidized at significantly different levels, as is the case with the San Bernardino County Transportation Authority Board of Directors Agenda Item January 9, 2019 Page 3 introduction of Gold Line service in the Metrolink corridor. Currently, it costs $1.75 to ride the Gold Line anywhere, regardless of whether a rider is traveling five miles or forty miles. This translates to the ticket fare contributing approximately 20% of the cost of the ride. Alternatively, Metrolink utilizes a distance-based fare, which results in a one-way ticket fare of $5.75 (after implementation of the 25% fare discount program) between Montclair and Los Angeles Union Station (LAUS) with Metrolink passengers contributing approximately 40% of the cost of the ride through the purchase of tickets. Due to the disparity in the cost to the riders, SBCTA staff is concerned there will be a substantial shift of Metrolink riders to the Gold Line. A shifting of riders has been demonstrated already, with the introduction of the Gold Line service in Azusa, where the Gold Line Station is located four miles north of the Covina Metrolink Station and accessed from the same arterial roadway. The difference in travel time to LAUS is approximately four (4) minutes longer on the Gold Line. The Metrolink Covina Station realized a 25% ridership decline when the Gold Line service was introduced. This is much higher than the overall 7.6% decline in ridership experienced for the Metrolink San Bernardino Line during that same time period. The funding available for transit operations is extremely limited and constrained. Any substantial decline in Metrolink ridership and the associated fare box revenue will impact SBCTA’s ability to fund the existing rail service in San Bernardino County, which serves all the communities along the existing Metrolink Corridor between Montclair and San Bernardino, and eventually east to Redlands. With the introduction of Diesel Multiple Units (DMU) in San Bernardino County as part of the future Arrow Service between San Bernardino and Redlands, there is an alternative available that could meet the needs of the communities in the existing Metrolink Corridor between Pomona and Montclair should the Project not receive the additional funding needed to proceed past La Verne or Pomona.