**Metro Gold Line East Side Extension**

**Los Angeles, California**

(November 2003)

# Description 

The Los Angeles County Metropolitan Transportation Authority (LACMTA) is
proposing to implement a 5.9-mile light rail transit (LRT) line in the
East Side Corridor, connecting downtown Los Angeles with low- to
moderate-income communities in East Los Angeles. The proposed Metro Gold
Line East Side Extension would include eight stations and would traverse
eastward from Union Station (the city's major intermodal hub, serving
intercity, commuter, and regional rail service, as well as local and
express bus services) along Alameda Street through the City Terrace,
Belvedere, and East Los Angeles communities of unincorporated Los
Angeles County. The project would terminate at Atlantic Boulevard, where
a 200-space park-and-ride facility is planned. The project would be
primarily at-grade, with a 1.8-mile mid-section underground in a tunnel.

The East Side Corridor has among the highest residential densities and
transit-dependent populations in Los Angeles. Over 60 bus routes
currently serve the corridor, many of which are at capacity during peak
travel times and which suffer delays due to traffic congestion. The
proposed fixed guideway investment would improve transit reliability and
capacity in the corridor and provide travel-time savings to East Side
residents accessing jobs in downtown Los Angeles and other employment
destinations along LACMTA's rail and rapid bus network. Compared to bus
alternatives, the light rail system would provide nearly 9,000 weekday
hours of travel-time benefits in 2020.

+------------------------------------+---------------------------------+
| **Summary Description**            |                                 |
+------------------------------------+---------------------------------+
| **Proposed Project:**              | Light Rail Transit              |
+------------------------------------+---------------------------------+
| ** **                              | 5.9 Miles, 8 Stations           |
+------------------------------------+---------------------------------+
| **Total Capital Cost (\$YOE):**    | \$898.8 Million                 |
+------------------------------------+---------------------------------+
| **Section 5309 New Starts Share    | \$490.7 Million (55%)           |
| (\$YOE):**                         |                                 |
+------------------------------------+---------------------------------+
| **Annual Operating Cost (2020      | \$22.4 Million                  |
| \$YOE):**                          |                                 |
+------------------------------------+---------------------------------+
| **Ridership Forecast (2020):**     | 23,000 Average Weekday          |
|                                    | Boardings                       |
+------------------------------------+---------------------------------+
| ** **                              | 8,600 Daily New Riders          |
+------------------------------------+---------------------------------+
| **Opening Year Ridership Forecast  | 17,000 Average Weekday          |
| (2009):**                          | Boardings                       |
+------------------------------------+---------------------------------+
| **FY 2005 Finance Rating:**        | # Medium                        |
+------------------------------------+---------------------------------+
| **FY 2005 Project Justification    | **Medium**                      |
| Rating:**                          |                                 |
+------------------------------------+---------------------------------+
| **FY 2005 Overall Project          | **Recommended**                 |
| Rating:**                          |                                 |
+------------------------------------+---------------------------------+

The overall project rating of ***Recommended*** is based upon the
corridor's transit-supportive land use and LACMTA's ability to meet the
project's capital and operating needs. 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.

##### Status

Initial systems planning efforts in the East Side Corridor began in
1989, resulting in the selection of a heavy rail subway line from Union
Station to Whittier/Atlantic Boulevard in 1993. FTA and LACMTA entered
into a Full Funding Grant Agreement (FFGA) on three heavy rail corridors
(MOS-3), which included the East Side and Mid-City projects, in May
1993. In January 1997, FTA requested that LACMTA suspend construction
activities and submit a recovery plan to demonstrate its ability to
complete the FFGA while maintaining and operating the existing bus
system. FTA approved the plan in July 1998. In 1998, LACMTA undertook an
alternatives analysis to analyze and evaluate feasible alternatives for
the East Side and Mid-City corridors. FTA approved the initiation of
preliminary engineering on the East Side project in August 2000. LACMTA
completed the NEPA process and received a Record of Decision in June
2002. FTA approved the project's entry into final design in October
2002.

The Metro Gold Line East Side Extension project was recommended for an
FFGA in the FY 2003 *Annual Report on New Starts*. Since that time, the
project's financial plan has been restructured to reflect the loss of
the majority of State funding and its replacement by local revenues. In
addition, a number of cost reduction measures were initiated, resulting
in a savings of approximately \$179 million. FTA has conducted a risk
analysis of the project capital cost estimate and has a high level of
confidence that the project will be completed within the proposed
budget. The FFGA is anticipated to be executed in spring 2004.

TEA-21 Section 3030(a)(38) authorized the Los Angeles MOS-3 for final
design and construction. Through FY 2001, Congress has appropriated
\$76.48 million for the original Mid-City and East Side subway
alignments. Through FY 2003, Congress has appropriated \$17.27 million
for the East Side Corridor 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.

+------------------------------------+----------------+----------------+
| **Project Justification            |                |                |
| Quantitative Criteria**            |                |                |
+------------------------------------+----------------+----------------+
| **Mobility Improvements Rating:    |                |                |
| Medium-High**                      |                |                |
+------------------------------------+----------------+----------------+
| **Average Employment Per Station** | **[New Start   |                |
|                                    | vs.            |                |
| **Average Low Income Households    | Baseline]      |                |
| Per Station**                      | {.underline}** |                |
|                                    |                |                |
| **Transportation System User       | 10,500         |                |
| Benefit Per Project Passenger Mile |                |                |
| (Minutes)**                        | 670            |                |
|                                    |                |                |
|                                    | 8.01           |                |
+------------------------------------+----------------+----------------+
| **Environmental Benefits Rating:   |                |                |
| High**                             |                |                |
+------------------------------------+----------------+----------------+
| **[Criteria Pollutant              | **[New Start   |                |
| Reduced]{.underline} (Tons)**      | vs.            |                |
|                                    | Baseline]      |                |
| **Carbon Monoxide (CO)**           | {.underline}** |                |
|                                    |                |                |
| **Nitrogen Oxide (NO~x~)**         | 43             |                |
|                                    |                |                |
| **Volatile Organic Compounds**     | 3              |                |
|                                    |                |                |
| **Particulate Matter (PM~10~)**    | 2              |                |
|                                    |                |                |
| **Carbon Dioxide (CO~2~)**         | 0.3            |                |
|                                    |                |                |
| **[Annual Energy                   | 2,027          |                |
| Savings]{.underline} (millions of  |                |                |
| BTU)**                             | 16,073         |                |
+------------------------------------+----------------+----------------+
| **Cost Effectiveness Rating:       |                |                |
| Low-Medium**                       |                |                |
+------------------------------------+----------------+----------------+
| **Cost per Transportation System   | **[New Start   |                |
| User Benefit (current year         | vs.            |                |
| dollars/hour)**                    | Baseline]      |                |
|                                    | {.underline}** |                |
|                                    |                |                |
|                                    | \$24.93        |                |
+------------------------------------+----------------+----------------+
| **Operating Efficiencies Rating:   |                |                |
| Medium**                           |                |                |
+------------------------------------+----------------+----------------+
| **System Operating Cost per**      | > **[Baseline] | **[New         |
|                                    | {.underline}** | Start]         |
| **Passenger Mile (current year     | >              | {.underline}** |
| dollars)**                         | > \$0.36       |                |
|                                    |                | \$0.36         |
+------------------------------------+----------------+----------------+

# Project Justification 

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

The *Medium* project justification rating reflects the high densities
and transit-supportive land uses in the corridor, but acknowledges the
project's poor cost effectiveness. Based on 1990 Census data, there are
an estimated 5,330 low-income households within a ½-mile radius of the
project corridor, representing 17 percent of all households located
within ½ mile of the corridor. There are an estimated 84,000 employees
within ½ mile of the transit station areas. The Los Angeles region is
classified as an extreme area for ozone, a serious area for carbon
monoxide and particulate matter, and an attainment area for nitrogen
oxides. The incremental cost per new rider of the Metro Gold Line East
Side Extension project is \$24.19.

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

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

The *Medium-High* rating reflects the dense urban character of the
corridor and generally transit- supportive zoning in areas served by the
proposed project.

**Existing Conditions:** The East Side Corridor contains a variety of
land uses: commercial uses in the Central City north area; industrial
uses between Central City north and the Los Angeles River; and
increasingly residential uses within the Boyle Heights and East Los
Angeles communities. There exists a mixture of residential, commercial,
and public uses along 1^st^ Street in Boyle Heights. Population in the
corridor is relatively dense (10,300 persons per square mile). Existing
parking in the corridor is primarily on-street, with the exception of
small lots to serve local businesses. Although much of the corridor is
auto-oriented, major shopping areas in Boyle Heights are
pedestrian-oriented, including the El Mercado area at First and Lorena
Streets. The *Los Angeles County Planning and Zoning Code* contains
development and parking standards for, and requires pedestrian amenities
in, specified transit-oriented districts, including the East Side
Corridor.

#### Future Plans, Policies and Performance: A number of development proposals are planned or currently under construction in the East Side Corridor that will ultimately increase densities throughout adjacent communities. The Pico Aliso and Aliso Village Urban Revitalization Demonstration Projects will provide for significant new residential and community resources in the corridor; medical and cultural centers are also planned. The *Los Angeles Land Use and Transportation Policy* and *LACMTA's Joint Development Policy* encourage the development of transit- and pedestrian-friendly development in transit station areas. Specifically, the policies contain incentives to reduce parking and increase densities within ½ mile of transit stations. While population and employment in the corridor through 2020 are expected to increase by 20 and 30 percent, respectively, the study area's share of regional population and employment is projected to decline. There are no significant policies that address growth management issues in the city, county, or region.

#### Local Financial Commitment 

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

The *Medium* local financial commitment rating reflects the adequacy of
the project's financial plan and its solid capital and operating funding
commitments.

**Proposed Non-Section 5309 New Starts Share of Total Project Costs:
45%**

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

LACMTA proposes to use Section 5309 New Starts funds to cover just under
55 percent of project costs. FHWA flexible funds, State funding sources,
Proposition A dedicated sales tax funds, and other revenues will also be
used to construct the Metro Gold Line East Side Extension project.

+----------------------------+--------------------+--------------------+
| **Locally Proposed         |                    |                    |
| Financial Plan**           |                    |                    |
+----------------------------+--------------------+--------------------+
| **[Proposed Source of      | **[Total Funding   | **[Percent of      |
| Funds]{.underline}**       | (\$milli           | To                 |
|                            | on)]{.underline}** | tal]{.underline}** |
+----------------------------+--------------------+--------------------+
| **Federal:**               | \$490.7            | 54.6 %             |
|                            |                    |                    |
| Section 5309 New Starts    | \$23.1             | 2.6 %              |
|                            |                    |                    |
| Section 5309 Fixed         | \$10.3             | 1.1 %              |
| Guideway Mod               |                    |                    |
|                            | \$179.6            | 20.0 %             |
| Flexible Funds (CMAQ)      |                    |                    |
|                            |                    |                    |
| Flexible Funds (STP)       |                    |                    |
+----------------------------+--------------------+--------------------+
| **State:**                 | \$45.0             | 5.0 %              |
|                            |                    |                    |
| Traffic Congestion Relief  | \$0.6              | 1.  \%             |
|                            |                    |                    |
| State Reg. Imp. Program    | \$139.4            | 15.5 %             |
|                            |                    |                    |
| **Local:**                 | \$10.1             | 1.2 %              |
|                            |                    |                    |
| Proposition A              |                    |                    |
|                            |                    |                    |
| Lease and General Revenues |                    |                    |
+----------------------------+--------------------+--------------------+
| **Total:**                 | **\$898.8**        | 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 *Medium-High* rating reflects the high level of local capital
funding committed to the proposed project and the adequacy of its
capital plan.

**Agency Capital Financial Condition:** The capital financial condition
of LACMTA is good. LACMTA has replaced about 70 percent of the bus fleet
over the past five years. The average age of the active fleet (2,346
buses) is relatively young at 4.2 years; the average fleet age including
the inactive fleet is 5.7 years, which is good. The agency enjoys a very
good bond rating and plans to issue very little debt for planned capital
improvements. LACMTA's sales tax base is strong. However, somewhat
aggressive assumptions about future revenues put the implementation of
other major planned capital improvements at some risk should such
resources not materialize.

### Capital Cost Estimate and Contingencies: LACMTA has completed value engineering and a risk analysis, and project capital cost estimates have been updated to reflect an advanced level of final design. FTA has a high level of confidence in the current project cost estimate.

Existing and Committed Funding: In July 2000, the California State
Assembly and Senate approved a Transportation Congestion Relief Plan.
Although subsequent funding from this source has been reduced, \$45
million for the Metro Gold Line East Side Extension project remains
available and is considered committed, with a six-year sunset provision.
Additional State funding comes from California's Regional Improvement
Fund; this \$600,000 in revenue is considered committed to the project.
Proposition A funds are under the control of LACMTA and are also
committed to the project.

New and Proposed Funding Sources: There are no new sources of funding
proposed for the project.

# Stability and Reliability of Operating Finance Plan 

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

The *Medium* rating is based on the sufficiency of the project's
operating finance plan and revenues.

**Agency Operating Financial Condition:** LACMTA has maintained balanced
operating budgets since FY 1999. Some operating deficits have occurred
in prior years, most recently FY 1998. Since the time of the 1998
recovery plan, the operating budget has received extensive management
attention, resulting in reduced bus costs per revenue hour in both
direct and indirect costs.

### Operating Cost Estimates and Contingencies: The operating and maintenance cost estimates appear reasonable, based on an analysis of projected growth in cost per revenue hour. The annual operating cost of \$22.4 million is a small percentage of LACMTA's operating budget. The rate of increase is greater than that of the past three years and somewhat less than longer-term historic performance.

Existing and Committed Funding: All operating funds exist and can be
committed to the project by the Board as needed.

**New and Proposed Funding Sources:** No new sources of operating
funding are being proposed by LACMTA.

MAP