**CenterLine LRT Project**

**Orange County, California**

(November 2003)

# Description 

The Orange County Transportation Authority (OCTA) is undertaking
preliminary engineering on an 8.5-mile transit corridor in central
Orange County between Santa Ana and Irvine. The proposed light rail
transit (LRT) project would connect major activity centers within the
corridor, including downtown Santa Ana (the county government center),
John Wayne Airport, and employment and entertainment centers in Costa
Mesa. Additionally, the proposed project would serve a major intermodal
center in Santa Ana providing connections to Metrolink commuter trains,
Amtrak, and regional bus service.

Current bus service on Interstate 5 and the local roadway network
suffers from significant traffic congestion, with conditions projected
to deteriorate over the next twenty years. The CenterLine project,
operating within an exclusive rail right-of-way, is forecast to provide
12,200 weekday hours of travel-time benefits to transit riders traveling
through the corridor in 2025, as compared to improved bus service in the
corridor. Work trips to employment sites in the corridor are anticipated
to result in over 80 percent of these benefits. The significant
transit-dependent population living in Santa Ana and elsewhere in the
corridor would further benefit from the fast and reliable LRT access to
employment opportunities located near the LRT alignment.

+------------------------------------+---------------------------------+
| **Summary Description**            |                                 |
+------------------------------------+---------------------------------+
| **Proposed Project:**              | Light Rail Transit              |
+------------------------------------+---------------------------------+
| ** **                              | 8.5 Miles, 16 Stations          |
+------------------------------------+---------------------------------+
| **Total Capital Cost (\$YOE):**    | \$965.7 Million                 |
+------------------------------------+---------------------------------+
| **Section 5309 New Starts Share    | \$482.9 Million (50%)           |
| (\$YOE):**                         |                                 |
+------------------------------------+---------------------------------+
| **Annual Operating Cost (2025      | \$21.0 Million                  |
| \$YOE):**                          |                                 |
+------------------------------------+---------------------------------+
| **Ridership Forecast (2025):**     | 24,800 Average Weekday          |
|                                    | Boardings                       |
+------------------------------------+---------------------------------+
| ** **                              | 15,900 Daily New Riders         |
+------------------------------------+---------------------------------+
| **Opening Year Ridership Forecast  | 17,400 Average Weekday          |
| (2009):**                          | Boardings                       |
+------------------------------------+---------------------------------+
| **FY 2005 Finance Rating:**        | # Medium-High                   |
+------------------------------------+---------------------------------+
| **FY 2005 Project Justification    | **Medium**                      |
| Rating:**                          |                                 |
+------------------------------------+---------------------------------+
| **FY 2005 Overall Project          | **Recommended**                 |
| Rating:**                          |                                 |
+------------------------------------+---------------------------------+

The overall project rating of ***Recommended*** is based upon the
project's strong financial plan and local funding commitments, as well
as its adequate cost effectiveness. The overall project rating applies
to this *Annual Report on New Starts* and reflects conditions as of
November 2003. Project cost estimates and proposed New Starts share are
developed by local project sponsors and are not FTA assumptions. Project
evaluation is an ongoing process. As New Starts projects proceed through
project development, estimates of cost, benefits, schedules and impacts
are refined. FTA's ratings and recommendation will be updated annually
to reflect new information, changing conditions, and refined financing
plans.

FTA notes that OCTA's travel forecasting model features some unusual
properties. FTA intends to work with OCTA over the next year to better
understand its travel forecasts and help improve OCTA's ability to more
accurately portray project benefits.

##### Status

In February 1998, FTA approved for entry into preliminary engineering a
proposed 30-mile light rail project which extended from Fullerton,
though the cities of Orange, Santa Ana, Costa Mesa, and Irvine, and
terminated at the Irvine Transit Center. In October 2001, the OCTA board
selected an 18.7-mile minimum operating segment (MOS). In October 2002,
OCTA requested shortening the MOS alignment to 11.9 miles from the
transit center in Santa Ana to the University of California at Irvine.
In June of 2003, the city of Irvine chose not to participate in the
project south of John Wayne Airport, and the system was shortened to 8.5
miles. OCTA plans to complete NEPA and receive a Record of Decision in
summer 2004. Construction is scheduled to begin in late 2005.

TEA-21 Section 3030(a)(59) authorized the Fullerton-Irvine Corridor for
final design and construction. Through FY 2003, Congress has
appropriated \$8.93 million in Section 5309 New Starts funds for this
project.

####### 

####### Evaluation 

The following criteria have been estimated in conformance with FTA\'s
*Reporting Instructions for the Section 5309 New Starts Criteria*,
updated in June 2003. The project will be re-evaluated when it is ready
to advance into final design and for next year's *Annual Report on New
Starts*.

+--------------------------------------+---------------+---------------+
| **Project Justification Quantitative |               |               |
| Criteria**                           |               |               |
+--------------------------------------+---------------+---------------+
| **Mobility Improvements Rating:      |               |               |
| Medium-High**                        |               |               |
+--------------------------------------+---------------+---------------+
| **Average Employment Per Station**   | **[New Start  |               |
|                                      | vs.           |               |
| **Average Low Income Households Per  | Baseline]{    |               |
| Station**                            | .underline}** |               |
|                                      |               |               |
| **Transportation System User Benefit | 5,075         |               |
| Per Project Passenger Mile           |               |               |
| (Minutes)**                          | 365           |               |
|                                      |               |               |
|                                      | 10.46         |               |
+--------------------------------------+---------------+---------------+
| **Environmental Benefits Rating:     |               |               |
| High**                               |               |               |
+--------------------------------------+---------------+---------------+
| **[Criteria Pollutant                | **[New Start  |               |
| Reduced]{.underline} (Tons)**        | vs.           |               |
|                                      | Baseline]{    |               |
| **Carbon Monoxide (CO)**             | .underline}** |               |
|                                      |               |               |
| **Nitrogen Oxide (NO~x~)**           | 33            |               |
|                                      |               |               |
| **Volatile Organic Compounds**       | 1             |               |
|                                      |               |               |
| **Particulate Matter (PM~10~)**      | 0             |               |
|                                      |               |               |
| **Carbon Dioxide (CO~2~)**           | 0             |               |
|                                      |               |               |
| **[Annual Energy                     | 14,510        |               |
| Savings]{.underline} (millions of    |               |               |
| BTU)**                               | 1,450         |               |
+--------------------------------------+---------------+---------------+
| **Cost Effectiveness Rating:         |               |               |
| Medium**                             |               |               |
+--------------------------------------+---------------+---------------+
| **Cost per Transportation System     | **[New Start  |               |
| User Benefit (current year           | vs.           |               |
| dollars/hour)**                      | Baseline]{    |               |
|                                      | .underline}** |               |
|                                      |               |               |
|                                      | \$19.21       |               |
+--------------------------------------+---------------+---------------+
| **Operating Efficiencies Rating:     |               |               |
| Medium**                             |               |               |
+--------------------------------------+---------------+---------------+
| **System Operating Cost per**        | >             | **[New        |
|                                      | **[Baseline]{ | Start]{       |
| **Passenger Mile (current year       | .underline}** | .underline}** |
| dollars)**                           | >             |               |
|                                      | > \$0.53      | \$0.52        |
+--------------------------------------+---------------+---------------+

# Project Justification 

**[Rating: Medium]{.underline}**

The *Medium* project justification rating reflects the project's
moderate cost effectiveness rating and local efforts to encourage
transit-supportive development in the corridor. Based upon 2000 Census
data, there are 5,840 low-income households within ½ mile of the station
areas, which comprise approximately 27 percent of the 21,460 households
within ½ mile of the station areas. There are 81,200 employees within ½
mile of the station areas, which comprise about 51 percent of the
157,000 total employees in the corridor. The Orange County metropolitan
area is an extreme non-attainment area for ozone. The incremental cost
per incremental trip for this project is \$16.00.

####### Transit-Supportive Existing Land Use and Future Patterns

**[Rating: Medium]{.underline}**

The *Medium* rating reflects the proactive role of OCTA in encouraging
transit-oriented planning by local jurisdictions, as well as the varied
(both good and poor) densities and transit-supportive conditions found
throughout the corridor.

**Existing Conditions:** The proposed project would serve Santa Ana,
Costa Mesa, and John Wayne Airport in Irvine.  In downtown Santa Ana,
land uses along the proposed corridor are currently being redeveloped
with transit-supportive densities and a pedestrian-friendly streetscape
environment. Between downtown Santa Ana and Costa Mesa, land uses
consist of strip commercial development surrounded by primarily
single-family neighborhoods, with some multi-family development.  In
Costa Mesa, development is a mix of mid-rise office, shopping plaza, and
multi-family residential.  As of 2000, a total of 81,200 jobs were
located within ½ mile of proposed stations. The residential density of
the station areas is fairly high, averaging 12,000 persons per square
mile.  Pedestrian accessibility is good in downtown Santa Ana; other
areas of the corridor have pedestrian access throughout, but for the
most part cannot be characterized as "pedestrian-friendly." Some good
examples of existing transit-supportive design are located in downtown
Santa Ana, where mixed-use redevelopment and pedestrian-oriented design
improvements have recently been completed.

**Future Plans, Policies and Performance:** OCTA has executed
cooperative agreements with all jurisdictions in the corridor to conduct
station area planning. Santa Ana and Costa Mesa are revising specific
plans covering portions of the corridor to reflect the CenterLine
project.   OCTA has also developed tools to assist in station area
planning efforts, including transit-supportive development guidelines, a
joint development strategy, station area land use profiles, station area
parking guidelines, and an implementation plan.  OCTA has conducted
public education and outreach on transit-oriented land use planning and
is investigating joint development opportunities.  The communities along
the corridor have relatively dense residential zoning (15 to 30 units
per acre and higher) in place in most station areas.  Allowable
commercial densities are relatively high in the Irvine employment center
and portions of Santa Ana.

#### Local Financial Commitment 

**[Rating: Medium-High]{.underline}**

The *Medium-High* local financial commitment rating was determined by
the sound financial condition of OCTA, the stability of the dedicated
revenue sources, and the commitment of all of the local funding for the
project.

**Proposed Non-Section 5309 New Starts Share of Total Project Costs:
50%**

**[Rating: Medium]{.underline}**

OCTA proposes to use Section 5309 New Starts funds to cover 50 percent
of project costs. The financial plan also includes FHWA flexible
funding, State Transportation Improvement Program funds, other State
funds, and local funds from Measure M, a county transportation sales
tax.

+------------------------+----------------------+----------------------+
| **Locally Proposed     |                      |                      |
| Financial Plan**       |                      |                      |
+------------------------+----------------------+----------------------+
| **[Proposed Source of  | **[Total Funding     | **[Percent of        |
| Funds]{.underline}**   | (\$mil               | Total]{.underline}** |
|                        | lion)]{.underline}** |                      |
+------------------------+----------------------+----------------------+
| **Federal:**           | \$482.8              | 50.0 %               |
|                        |                      |                      |
| Section 5309 New       | \$16.8               | 1.7 %                |
| Starts                 |                      |                      |
|                        |                      |                      |
| Flexible Funding       |                      |                      |
+------------------------+----------------------+----------------------+
| **State:**             | \$199.0              | 20.6 %               |
|                        |                      |                      |
| STIP                   | \$120.0              | 12.4 %               |
|                        |                      |                      |
| Proposition 116        | \$147.1              | 15.2 %               |
|                        |                      |                      |
| **Local:**             |                      |                      |
|                        |                      |                      |
| Measure M              |                      |                      |
+------------------------+----------------------+----------------------+
| **Total:**             | **\$965.7**          | 100.0 %              |
+------------------------+----------------------+----------------------+

**NOTE:** Funding statements reflected in this table have been made by
project sponsors and are not DOT or FTA assumptions. Sum of figures may
differ from total as listed due to rounding.

####### Stability and Reliability of Capital Financing Plan

**[Rating: Medium-High]{.underline}**

The CenterLine LRT project has received a *Medium-High* capital plan
rating because 100 percent of proposed local funding for the project is
committed from existing sources.

**Agency Capital Financial Condition:** OCTA is in sound financial
condition. The agency has sufficient capital resources from a ½ percent
sales tax (Measure M) to finance a wide range of capital improvements.
OCTA carries a very high bond rating: Aa2/AA+/AA by Moody's, Standard
and Poor's, and Fitch, respectively. In addition, OCTA has lowered the
average age of its bus fleet from 6.5 to 5.2 years within the last year.

### Capital Cost Estimate and Contingencies: OCTA has incorporated cost contingencies into its financial plan. The contingencies appear adequate to cover potential cost overruns for design and construction, rights-of-way, and vehicle cost. An additional project reserve of 10 percent exists and is applied to the total costs including contingencies. OCTA has debt capacity to cover a 30 percent funding shortfall and cost increases in the project. 

Existing and Committed Funding: All non-Section 5309 New Starts capital
funds are committed. The OCTA Board of Directors has committed \$147
million in Measure M funds and sufficient CMAQ and State Transit
Improvement Program (STIP) funding to finance the non-Section 5309 New
Starts share of capital costs.

New and Proposed Funding Sources: All funds for the proposed non-Section
5309 share of project costs come from existing sources.

# Stability and Reliability of Operating Finance Plan 

## Rating: Medium-High

The *Medium*-*High* operating plan rating reflects the existing
dedicated revenue stream for operating the CenterLine project.

**Agency Operating Financial Condition:** OCTA is in sound operating
condition. Measure M and other existing revenues provide the agency with
sufficient resources to operate its existing bus system. OCTA has not
experienced any operating shortfalls in its existence, demonstrating a
net surplus of \$3.8 million in 2003 and a cash balance to cover 35
percent of annual operating expenses.

**Operating Cost Estimates and Contingencies:** Annual operating and
maintenance costs are estimated at \$21 million. These estimates appear
reasonable given the proposed size of the LRT system.

**Existing and Committed Funding:** OCTA proposes that operation of the
completed CenterLine project would be funded from Measure M, CMAQ, and
farebox revenues for the first three years of operation. All funding for
operating and maintenance is existing and committed. Local resources are
expected to yield sufficient funds to operate the completed 8.5-mile
system through 2011 when the Measure M sales tax is scheduled to end. If
the Measure M initiative is not renewed, the project would experience a
declining but still positive operating cash balance from 2012 through
2025.

**New and Proposed Funding Sources:** No new sources of funding are
proposed.