Agenda Item5
1 DATE: May 5, 2025
TO: Honorable Mayor and Members of the City Council through City Manager FROM: Jared Hall - Transit Manager, Public Works Department Camille Sullivan - Senior Management Analyst, Public Works Department Jeff Stutsman, TE, PE - Deputy Director of Operations, Public Works Department
SUBJECT: Resolution Authorizing the Submission of an Application for the Low Carbon Transit Operations Program and the Execution of the Certifications and Assurances for the Following Project: Purchase One Replacement Zero- Emission Bus
RECOMMENDATION
It is recommended that the City Council adopt a Resolution Authorizing the submission of an application for the Low Carbon Transit Operations Program and the execution of the Certifications and Assurances for the following project: purchase one replacement zero-emission bus.
BACKGROUND
The Low Carbon Transit Operations Program (LCTOP) is one of several programs that are part of the Transit, Affordable Housing, and Sustainable Communities Program established by the California Legislature in 2014 with Senate Bill 862. SB 862 established the LCTOP as a non- competitive, formula-based program, with 5% of annual cap-and-trade auction proceeds being continually appropriated since 2015. LCTOP funds are distributed based on prior use of State Transit Assistance (STA) funds, with 50% of funding designated to regional entities and the other 50% to transit operators. LCTOP was created to provide operating and capital assistance to transit agencies to reduce greenhouse gas emissions and improve mobility, with an emphasis on serving Disadvantaged Communities. The program is administered by Caltrans in coordination with the California Air Resources Board (CARB) and the State Controller’s Office.
DISCUSSION
For the FY 24/25 allocation, Petaluma is programmed to receive a total of $133,958, down from $166,565 the prior year due to a decrease in revenue from statewide Cap and Trade auctions. 2 This amount is based upon a combination of the revenue generated by Petaluma Transit and the City population for FY 23/24.
All regional entities and transit operators expecting to receive LCTOP funds are required to submit the Certifications and Assurances document to Caltrans annually prior to receiving funding, accompanied by a governing board resolution. Eligible agencies that do not submit the Certifications and Assurances document and allocation request could risk losing their apportionment for that specific fiscal year to another operator within the region.
LCTOP funds are to be expended by transit agencies on operating or capital projects that reduce greenhouse gas emissions and improve mobility, with a priority on serving disadvantaged communities, and should fulfill any of the following goals:
1. Expenditures that directly enhance or expand transit service by supporting new or expanded bus or rail services, new or expanded water-borne transit, or expanded intermodal transit facilities. This may include equipment acquisition, fueling, maintenance, and other costs to operate those services or facilities.
2. Operational expenditures that increase transit mode share.
3. Expenditures related to the purchase of zero-emission buses, including electric buses, and the installation of the necessary equipment and infrastructure to operate and support zero- emission buses.
Of the three criteria, option three best meets the current needs of Petaluma Transit while simultaneously maintaining funding flexibility through other sources, including STA and Transit Development Act (TDA) funds, to go towards operational needs.
Funding provided through the LCTOP grant will be set aside to serve as matching funds towards the replacement of an existing fixed route bus in FY 25/26. This purchase is anticipated to be funded by FTA 5307 funds (75%), with the local match requirement made up of LCTOP funds and Transit and Intercity Rail Capital Program (TIRCP) grant funds. Using these funds for the purchase of a replacement bus will enable Petaluma Transit to meet the LCTOP program goal of reducing greenhouse gas emissions while preserving TDA reserve funds for general operating use. The existing bus, having reached the end of its useful life, will be auctioned for sale upon receipt of the new bus.
On December 14, 2018, the California Air Resources Board approved the Innovative Clean Transit Regulation, which requires California transit agencies to gradually transition their buses to zero-emission technology. In line with this policy, Petaluma Transit has purchased four Zero- Emission Buses in FY 24/25 and intends to purchase multiple Zero-Emission Buses in FY 25/26 to replace outgoing diesel buses. Additional City Council action will be required at the time of acquisition.
Funding received through the FY 24/25 LCTOP allocation will be used in part to purchase a zero-emission battery electric bus. The bus is anticipated to be ordered in FY25/26. This is an important step towards the continued electrification of the Petaluma Transit Bus Fleet in order to 3 fulfill the California Innovative Clean Transit Initiative (all zero-emission buses by 2040) and the City of Petaluma’s Blueprint for Climate Action.
Additionally, staff are required to submit a City Council Resolution to the Metropolitan Transportation Commission (MTC) supporting the allocation request package.
PUBLIC OUTREACH
This item was reviewed at the March 18, 2025 regular meeting of the Transit Advisory Committee and appeared on the City Council’s tentative agenda document on April 21, 2025, which was a publicly noticed meeting.
These projects reflect the identified needs of Petaluma Transit as identified over the past four years for operating and capital improvements, including discussions with the Transit Advisory Committee and associated agency goals.
COUNCIL GOAL ALIGNMENT
The proposed action supports the following City Council Goals, Objectives, and Workplan Items:
•Workplan item # 52 - Develop a framework to move the City and Transit vehicle fleet from fossil-fuel-based to hybrid, renewable compressed natural gas, and/ or electric vehicles; continue pursuing grant funding opportunities for electric vehicles.
CLIMATE ACTION/SUSTAINABILITY EFFORTS
By replacing diesel buses with zero-emission buses, Petaluma Transit can reduce greenhouse gas emissions from its vehicle fleet and provide its operations in a cleaner, greener way. This will help to achieve many of the goals outlined in the Blueprint for Climate Action, specifically Cornerstone Action ZEVFB-1: Electrification of transit fleet.
ENVIRONMENTAL REVIEW
The proposed action is exempt from the requirements of the California Environmental Quality Act (CEQA) in accordance with CEQA Guidelines Section 15378, in that applying for a grant does not meet CEQA's definition of a “project,” because the action does not have the potential for resulting in either a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environment, and because the action does not commit the City to a definite course of action (See City of Irvine v. County of Orange (2013) 221 Cal 4th 846, 865 County’s decision to apply for state funding for potential jail expansion was not project approval). Any future action due to the use of the grant funds will receive its own analysis under CEQA. However, purchasing one zero-emission bus to replace an existing diesel bus, with no increase in service will likely be exempt pursuant to CEQA Guidelines Section 15061, the commonsense exemption and/or 15302 (Replacement).
4 FINANCIAL IMPACTS
The FY 24/25 LCTOP allocation represents $133,958 in capital funding for FY 25/26, which will permit the City to replace one bus that has reached the end of its useful life, without using TDA funds that would otherwise be used for transit operations.
ALTERNATIVES
This proposed action will provide funding to purchase a zero-emission bus. Without this funding, the City would either consider purchasing a lower-cost, diesel-emitting bus or need to identify additional funding sources to help fund the increased expense of battery-electric buses.
ATTACHMENTS
1. Resolution