The 2024-25 Spending Plan

Transportation

Overview

As shown in Figure 1, the budget package provides a total of $30.4 billion for transportation-related programs in 2024‑25, including for the California Department of Transportation (Caltrans), California State Transportation Agency, local streets and roads (shared revenues), California Highway Patrol (CHP), Department of Motor Vehicles (DMV), and High-Speed Rail Authority (HSRA). This total reflects a net decrease of $4.5 billion (13 percent) compared to estimated 2023‑24 expenditure levels. This year-to-year change is primarily due to large amounts of one-time funds from previous budget packages that were available for expenditure in the prior year, particularly from the General Fund. Below, we summarize some of the major revisions made to previous budgets and spending plans to address the state’s General Fund budget shortfall. We then identify the other most notable changes made to transportation program budgets.

Revisions to Prior Budget Packages and Spending Plans

Makes Some Modifications to Address General Fund Condition, Maintains Majority of Previous Augmentations Provided to Transportation Programs. Recent budget packages planned for significant multiyear General Fund augmentations for transportation programs, with a smaller portion coming from special funds. This includes multiyear funding provided within thematic packages centered around improving transportation infrastructure and supply chains and through a few other one-time augmentations. To address the General Fund shortfall, the 2024‑25 budget makes a few modifications to transportation funding included and planned for in prior budgets. (These changes build upon fund shifts and delays that were made as part of the 2023‑24 budget agreement.) In total, these changes reduce General Fund spending by $4.4 billion across the budget window (2022‑23 through 2024‑25). However, some of these savings are only temporary because the budget agreement plans to provide the funding in a future year. Overall, the budget package has the net effect of reducing General Fund spending by $2.3 billion across the multiyear period through 2027‑28.

Major reductions include $400 million from the Active Transportation Program, $200 million for grade separation projects, and $96 million from support for the Port of Oakland. The spending plan also changes the timing of when some funding will be provided, such as by delaying planned funding to a future year and through cash flow adjustments—reverting funds that have already been awarded to projects with the intent to reappropriate the dollars in a future year when they are needed to cover planned expenditures. Additionally, the budget shifts some spending from the General Fund to the Greenhouse Gas Reduction Fund (GGRF) and the State Highway Account. This includes a combined total of $1.3 billion from the competitive and formula-based Transit and Intercity Rail Capital Programs (TIRCP) shifted to GGRF. After accounting for these modifications, the budget retains $11.5 billion ($8.2 billion from the General Fund) for transportation programs across a seven-year period (2021‑22 through 2027‑28), which is 93 percent of the multiyear amount originally planned. Figure 2 provides more details on the modifications included in the budget.

Delays Some Transit Funding. The budget delays some funding for transit infrastructure and operations. This includes $1 billion from formula-based TIRCP that had been planned for 2024‑25 to instead be provided in 2025‑26, as well as a total of $460 million that had been planned for the Zero-Emission Transit Capital Program across 2023‑24 and 2025‑26 to instead be provided in 2027‑28. Both programs can be used by local transit agencies to support either operations or infrastructure projects, although they have some differing requirements and restrictions on the types of projects that can be funded.

Caltrans

The budget provides $15.3 billion to support Caltrans in 2024‑25. This is roughly the same amount as the estimated 2023‑24 expenditure level. A few notable new augmentations include the following:

• Establishes Ongoing Funding for Expanded California Integrated Travel Project. The budget includes $11.8 million from the Public Transportation Account in 2024‑25 (increasing to $26.3 million annually in 2026‑27) to expand and provide ongoing support for the California Integrated Travel Project. This program funds various activities intended to improve and standardize the ridership experience across public transit agencies. The program was first established in 2021‑22 using limited-term federal funding.

• Increases Funding for Intercity Passenger Rail Program. The budget includes $66 million in 2024‑25, $72 million in 2025‑26, and $73 million in 2026‑27 from the Public Transportation Account through Caltrans to support Intercity Passenger Rail Program operations. This will augment existing funding for three state-supported intercity passenger rail services operated by Amtrak (Capitol Corridor, San Joaquin, and the Los Angeles-San Diego-San Luis Obispo Rail [LOSSAN] Corridor). These services historically have relied heavily on fare revenues to support their operations. However, increased operating costs, decreased ridership, and the expiration of limited-term federal funds have resulted in them experiencing structural budget deficits in recent years.

• One-Time General Fund to Support Local Transportation Projects. The budget includes $20.8 million from the General Fund through Caltrans to support four local transportation projects, including: (1) $8 million to repair storm damage to bluffs in Crescent City, (2) $5 million for the Active Transportation Program to support bike lanes that connect disadvantaged communities to higher education facilities and job centers, (3) $4 million to support operations and maintenance for the Sonoma-Marin Area Rail Transit District, and (4) $3.8 million for a street safety project in Sonoma County.

California Highway Patrol

The budget provides $3.2 billion for CHP in 2024‑25, which represents a reduction of $110 million (about 3 percent) relative to 2023‑24. Similar to last year, the budget includes a number of shifts in the funding approach for CHP capital outlay projects. Specifically, the budget shifts $13.1 million from the General Fund to lease revenue bonds for the performance criteria phase of six area office projects including Antelope, Barstow, Gold Run, Los Banos, Porterville, and Redding. The administration has not yet identified what fund source it plans to propose to pay the future debt service on these bonds.

Department of Motor Vehicles

The budget provides $1.5 billion for DMV in 2024‑25, which is roughly equivalent to the estimated 2023‑24 expenditure level. This relatively flat year-to-year comparison masks the expiration of some limited-term expenditures and carryover balances from prior years, offset by a few augmentations from the Motor Vehicle Account related to information technology. This new spending includes: (1) $60.2 million in one-time funding in 2024‑25 for the driver licensing and vehicle registration phases of the Digital Experiences Platform; (2) $17.3 million ongoing funding to cover increases in fees the California Department of Technology charges for services it provides to DMV; (3) $7.4 million in 2024‑25, decreasing to $4.9 million on an ongoing basis in future years, to improve the department’s cybersecurity; and (4) $2.4 million in 2024‑25 to update the Commercial Driver License Information System to comply with federal mandates. The budget also includes $4.5 million in 2024‑25 (decreasing to $200,000 ongoing in future years) from the General Fund to continue the development and implementation of the Motor Voter Program.

High-Speed Rail Authority

The budget provides a total of $1.1 billion for HSRA in 2024‑25, mostly from GGRF. While this is a net reduction from the estimated 2023‑24 expenditure level, actual expenditures in 2024‑25 could be notably higher or lower than budgeted. This is because the project has access to resources—such as GGRF funds that remain unspent from prior years—that far exceed the budgeted amount.

Replaces Consultants With State Staff. The budget includes $14 million (just over $13 million from GGRF and $279,000 from Proposition 1A bond funds) on an ongoing basis and authority to hire 67 state staff to replace work currently undertaken by consultants. The additional state staff are expected to reduce contract costs, resulting in net savings to the state of $9 million. (HSRA estimates it currently spends around $22 million for consultants to undertake this work.)

Budget Trailer Legislation Increases Administrative Spending Cap. The budget package includes trailer legislation that raises the share of Proposition 1A bond funds that can be used for HSRA’s administrative expenses (known as the administrative spending cap) from 2.5 percent to 5 percent. Given the $9 billion in Proposition 1A bond authority for the high-speed rail project, this action increases the maximum amount of Proposition 1A funding available to HSRA for administrative purposes from $225 million to $450 million.

High-Speed Rail Authority Office of the Inspector General

Funding and Budget Trailer Legislation Support Establishment of the Office of the Inspector General. The 2024‑25 budget provides a total of $3 million on an ongoing basis from the Public Transportation Account for the High-Speed Rail Authority Office of the Inspector General. This is an increase of $2 million from the estimated 2023‑24 level. The funds will support 14 new permanent staff positions. These new positions, along with the recently appointed Inspector General, will launch the office, which was created by Chapter 71 of 2022 (SB 198, Committee on Budget and Fiscal Review). The budget package also includes trailer legislation to make technical amendments to Chapter 71 and facilitate the successful startup of the office.