DATE: June 18, 2025
TO: Honorable Mayor and City Councilmembers
FROM: Development Services Department
TITLE: RESOLUTION APPRopriating FUNDS and approving the City’s Senate Bill 1 project LIST FOR FISCAL YEAR 2025-26
RECOMMENDATION
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Staff recommends that the City Council adopt a resolution appropriating $4,545,901 in Road Maintenance and Rehabilitation Account (RMRA) funds provided by Senate Bill 1 (“SB1”) to SB1 Gas Tax Fund 265 and approve the City’s SB1 project list for Fiscal Year (FY) 2025-26.
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BACKGROUND AND ANALYSIS
In April 2017, SB1, the Road Repair and Accountability Act, was enacted into law. It provides cities with significant additional funding for a broad range of transportation improvements including constructing new, or maintaining existing, transportation infrastructure. The law includes certain provisions to ensure government accountability to the public, which require adoption of improvement plans as part of a separate resolution.
The State levies fuel taxes and distributes a portion of the revenue to cities and counties as Highway User Tax Account (HUTA) funds. This fiscal year, the City received $4,994,875 in HUTA funds which is currently available for use by Public Works Street Maintenance Division to address potholes and other maintenance items. Under SB1, cities and counties receive additional funds raised from fuel taxes and vehicle registration taxes from the RMRA. Eligible uses of RMRA are similar to, and as broad as, current HUTA funds. The State Streets and Highways Code Section 2030(a) describes eligible uses of the RMRA fund to include “basic road maintenance and road rehabilitation projects, and critical safety projects.”
Since the RMRA was enacted, the City Council has appropriated the following RMRA funds by resolution:
• $1.00 million in October 2017
• $3.13 million in April 2018
• $2.94 million in April 2019
• $2.69 million in April 2020
• $3.48 million in April 2021
• $4.03 million in June 2022
• $4.28 million in June 2023
• $4.42 million in June 2024
The California League of Cities provides an annual estimate of anticipated funding to be received by cities and anticipates that Oceanside will receive $4,545,901 in RMRA funds in FY 2025-26.
Program Requirements
SB1 imposes certain public accountability requirements. While not particularly burdensome, they are a requirement for receiving RMRA funds and necessary to demonstrate the program’s effectiveness and maintain public support for transportation infrastructure taxation.
By July 1, 2025, cities are required to adopt and forward to the California Transportation Commission a list of projects for FY 2025-26 to be funded by RMRA. The list shall include a brief project description, location, schedule, and estimated useful life.
The proposed FY 2025-26 SB1 program will continue to fund street restoration, street preservation, survey monument preservation, pedestrian warning signals, radar feedback signs, safe crosswalk and sidewalk repair projects.
Focus remains on the Pavement Management Program (PMP) to ensure revenues are being used in a cost-effective manner by preventing costly replacement of the entire roadway section and asphalt surface in the future. Historically, annual slurry seal, overlay, and full depth reclamation projects proposed under the PMP have been appropriated estimated RMRA funds in varying amounts, from 69 percent in 2017 and up to 92 percent in 2022.
FY 2025-26 SB1 Projects
Staff recommends that FY 2025-26 SB1 funds be distributed among the following projects listed in the proposed resolution (Attachment 2):
1. Americans with Disabilities Act for Overlay
2. Asphalt Overlay
3. Annual Storm Drain Improvements
4. Street Maintenance
5. Street Monument Preservation
6. Slurry Seal
7. PMP - New Program Assessment
8. Pedestrian Warning Signals
9. Radar Feedback Signs
10. Sidewalk Repairs Citywide
11. Olive Drive Guardrail
12. Inland Rail Trail
13. McNeil Street Construction
14. Crosswalk at S. Coast Highway and Loma Alta Creek - Design
Slurry seal and overlay street locations, which were funded by SB1, are shown in the Resolution Candidate Street List (Exhibit A of Attachment 2). Exhibit A includes the list of streets from FY 2023-24 that were completed mostly in FY 2024-25. The list of proposed streets is currently in the works as the PMP update is coming to completion.
FISCAL IMPACT
The City’s exact RMRA revenue will vary depending upon actual State tax receipts and will be remitted on a monthly basis. Upon receipt of funds, the monies will be deposited into revenue accounts within the RMRA Gas Tax fund, 1265.4132.0002 Gas Tax RMRA Excise Tax. The RMRA funds have been programmed as part of the Capital Improvement Program (CIP) process. Any future funds received in RMRA will be appropriated as needed for given projects. Budget versus estimated revenues are shown in the following table:
|
Project Description |
Project Account |
FY 2025-26 Appropriation |
|
Slurry Seal |
425447265 |
$700,000 |
|
Asphalt Overlay |
902155518265 |
1,639,555 |
|
ADA for Overlay |
902157619265 |
875,561 |
|
Annual Storm Drain Improvements |
902158319265 |
789,302 |
|
Street Monument Preservation |
902162720265 |
43,900 |
|
Street Maintenance (SB1) |
902165520265 |
400,000 |
|
Laurel Street Elementary |
902169320265 |
4,400 |
|
Pedestrian Warning Signals |
903176122265 |
209,817 |
|
Radar Feedback Signs |
903169622265 |
300,000 |
|
Sidewalk Repairs Citywide |
912177422265 |
150,000 |
|
Pavement Management Program |
902162820265 |
11,000 |
|
Olive Drive Guardrail |
902191824265 |
150,632 |
|
Inland Rail Trail City Match |
902188223265 |
29,700 |
|
McNeil Street Construction |
902191324265 |
1,516,500 |
|
SS4A - City Match |
902195724265 |
100,000 |
|
Crosswalk at S. Coast Hwy & LAC |
902200925265 |
200,000 |
|
|
Proposed Budget |
$ 7,120,368 |
|
|
Beginning Fund Balance |
$ 4,658,396 |
|
|
RMRA Revenue |
$ 4,545,901 |
|
|
Total Fund Balance |
$ 9,204,297 |
The City must comply with a “maintenance of effort” requirement to spend at least $2.2 million from existing funds for street purposes. This amount is derived from the average expenditures for FY 2009-10 through FY 2011-12. The City uses other existing funding sources such as TransNet and Measure X for the maintenance of effort requirement.
COMMISSION OR COMMITTEE REPORT
The State-imposed deadline of July 1, 2025 to submit the adopted resolution for these SB1-funded projects requires prior approval by the Planning Commission. On May 19, 2025, the Planning Commission determined the projects identified in the FY 2025-26 CIP Budget, including the SB1 Program, are consistent with the City of Oceanside General Plan.
CITY ATTORNEY’S ANALYSIS
The referenced documents have been reviewed by the City Attorney and approved as to form.
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Prepared by: Victor Velasco, Principal Civil Engineer
Reviewed by: Darlene Nicandro, Development Services Director
Submitted by: Jonathan Borrego, City Manager
ATTACHMENTS:
1. Resolution approving SB1 Project List