10/24/19

Board of Directors | Item 14 | October 25, 2019 1

Board of Directors Item 14 | October 25, 2019

SAN DIEGO FORWARD: THE 2019 FEDERAL REGIONAL TRANSPORTATION PLAN

THE 2019 FEDERAL REGIONAL TRANSPORTATION PLAN

• February 2019: Action plan to develop bold new vision and 2021 Regional Plan

• Actions to preserve the flow of transportation funds– Assembly Bill 1730

– 2019 Federal Regional Transportation Plan

Moving Towards a Bold New Vision

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10/24/19

Board of Directors | Item 14 | October 25, 2019 2

THE 2019 FEDERAL REGIONAL TRANSPORTATION PLAN

• Revokes California’s ability to enforce stricter greenhouse gas standards and zero-emission vehicle mandates

• Effective November 26, 2019

• SANDAG and other metropolitan planning organizations will be unable to make air quality conformity determinations– Cannot adopt Regional Transportation Plans

– Cannot adopt new Regional Transportation Improvement Programs and some types of amendments

Federal SAFE Rule

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THE 2019 FEDERAL REGIONAL TRANSPORTATION PLAN

• Updated revenue estimates and project costs

• Updated travel modeling tools and new Regional Growth Forecast

• $208 billion in investments

• Carries forward the projects, programs, and policies in the 2015 Regional Plan

2019 Federal Regional Transportation Plan

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10/24/19

Board of Directors | Item 14 | October 25, 2019 3

THE 2019 FEDERAL REGIONAL TRANSPORTATION PLAN

• Collaboration with Community Based Organizations in Disadvantaged Communities

• Analysis of Disadvantaged Populations

• Assessment of equitable access to transportation choices

• Assessment of the distribution of transportation improvements

• No disparate impacts or disproportionate effects for minorities or low-income populations were found

Social Equity Analysis

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THE 2019 FEDERAL REGIONAL TRANSPORTATION PLAN

• SANDAG Board of Directors

• SANDAG Working Groups

• Tribal Consultation

• Public hearing

Public Involvement

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• Network of Community Based Organizations

• Open houses

• Online comment tool, eblasts, social media

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10/24/19

Board of Directors | Item 14 | October 25, 2019 4

THE 2019 FEDERAL REGIONAL TRANSPORTATION PLAN

• Proposed Draft Transportation Network – 57 comments received

• Draft 2019 Federal RTP – More than 180 comments received

• Comment themes: – Support for 2019 Federal RTP & 5 Big Moves

– Need for more frequent and new transit services

– Concerns regarding congestion and travel times

– Support of specific projects/corridors

Public Comments

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THE 2019 FEDERAL REGIONAL TRANSPORTATION PLAN

Adopt Resolution No. 2019-12, adopting the air quality

conformity determination, finding that the Revenue

Constrained Plan is in conformance with the State

Implementation Plan for air quality, adopting the 2019

Federal Regional Transportation Plan and its supporting

analyses, and adopting findings in support of a Notice of

Exemption under the California Environmental Quality Act.

Action

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Board of Directors | Item 16 | October 25, 2019 1

Overview of the Financial Markets and Quarterly Finance Report

as of September 30, 2019

Board of Directors Item 16October 25, 2019

1

Key updates

Commission:

Senior Lien - AAA ratings Affirmed

Subordinate Lien – AA ratings Affirmed

Junior Lien – Upgraded A to A+

SR 125:

SR 125 Toll Road – Upgraded A- to A

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Board of Directors | Item 16 | October 25, 2019 2

Key updates

SANDAG:

Successfully closed on $335M GANS

• Orders placed 51 investors for $3.1B

• Lowered stated yield to 1.91%

• Expected yield is 1.57%

• Financing for Mid-Coast is complete

3

Key updates

Interest Rate Swaps:

- Mark-to-Market is in a negative position

- However, performing as intended and no reason to terminate swaps

Investment Portfolio:

- Currently $1.24 billion in investments

- Yield of 2.03%, expected to drift lower

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Board of Directors | Item 16 | October 25, 2019 3

Local Economy and Sales Tax Revenue Update

5

1.0

1.1

1.2

1.3

1.4

1.5

1.6

Jan

-00

Jan

-01

Jan

-02

Jan

-03

Jan

-04

Jan

-05

Jan

-06

Jan

-07

Jan

-08

Jan

-09

Jan

-10

Jan

-11

Jan

-12

Jan

-13

Jan

-14

Jan

-15

Jan

-16

Jan

-17

Jan

-18

Jan

-19

Recovery (Jun-14)

6

Venture capital investment

Total employment

Source: BLS

Source: BLS Source:PwC/CBInsights MoneyTree™

Unemployment rate

The region’s economy remains strong

Source: EDD

Peak(Dec-07)

Trough(Jan-10) 78 Months

115+ Months

10.8%

3.2%

0

2

4

6

8

10

12

Jan

-10

Jun

-10

No

v-1

0

Apr

-11

Se

p-1

1

Fe

b-1

2

Jul-

12

De

c-1

2

Ma

y-13

Oct

-13

Ma

r-14

Au

g-1

4

Jan

-15

Jun

-15

No

v-1

5

Apr

-16

Se

p-1

6

Fe

b-1

7

Jul-

17

De

c-1

7

Ma

y-18

Oct

-18

Ma

r-19

Au

g-1

9

Employment by industry

Per

cent

Mill

ions

Change Jan 2010- Sept 2019

500

1,000

1,500

2,000

2,500

3,000

201

0

201

1

201

2

201

3

201

4

201

5

201

6

201

7

201

8

201

9*

Mill

ions

$

-10,000 0 10,000 20,000 30,000 40,000 50,000 60,000

Information

Mining and Logging

Financial Activities

Other Services

Manufacturing

Trade, Transp. & Utilities

Government

Construction

Edu. & Health Services

Leisure &Hospitality

Prof. & Bus. Services

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Board of Directors | Item 16 | October 25, 2019 4

7

Median house prices

Total employment

Source: BLS

Source: BLS

29.8

28.4

27.5

28.0

28.5

29.0

29.5

30.0

Jan

-16

Ma

r-16

Ma

y-16

Jul-

16

Se

p-1

6

No

v-1

6

Jan

-17

Ma

r-17

Ma

y-17

Jul-

17

Se

p-1

7

No

v-1

7

Jan

-18

Ma

r-18

Ma

y-18

Jul-

18

Se

p-1

8

No

v-1

8

Jan

-19

Ma

r-19

Ma

y-19

Jul-

19

Source: California Association of Realtors

2.7%

2.1%

2.3%

1.6%1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

Jan

-16

Ma

r-16

Ma

y-16

Jul-

16

Se

p-1

6N

ov-

16

Jan

-17

Ma

r-17

Ma

y-17

Jul-

17

Se

p-1

7N

ov-

17

Jan

-18

Ma

r-18

Ma

y-18

Jul-

18

Se

p-1

8N

ov-

18

Jan

-19

Ma

r-19

Ma

y-19

Jul-

19

Average hourly wages(2018 $)

Possible signs of economic weakness

$0

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

Sep-15 Sep-16 Sep-17 Sep-18 Sep-19

+5.8%+8.4%

+6.3% -0.5%

(YOY Percent Change)

* EstimateSource: Real Estate Research Council of Southern California

Residential permits

-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

200

02

001

200

22

003

200

42

005

200

62

007

200

82

009

201

02

011

201

22

013

201

42

015

201

62

017

201

82

019

*

12,000 needed annually to support population growth

2010-2018average (7,700)

Sales tax revenue collection(California Department of Tax and Fee Administration—Methodology change)

Fiscal years

2016 2017 2018 2019 2020250

260

270

280

290

300

310

320

Mill

ions

$

$ 294.5 M

$ 301.5 M $ 305.5 M

$ 312.3 M

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Board of Directors | Item 16 | October 25, 2019 5

$17

$28

$44

$61

$63

$85

50 100

Other food

Construction

Restaurants

Business To Business

Transportation

General Retail

Sales tax revenue by sector2018 Q2 to 2019 Q1

+1%

+3%

+5%

0%

+3%

+2%

Millions $

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Impact of past recessions on TransNet revenues(Year of collection dollars)

100

150

200

250

300

350

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Mill

ion

$

6 1/2 yearsto recover

4 yearsto recover

1991

rece

ssio

n

GDP-1.4%

GDP-0.3%

GDP-5.1%

2001

rec

essi

on

Gre

atre

cess

ion

Fiscal years10

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Board of Directors | Item 16 | October 25, 2019 6

250

270

290

310

330

350

370

390

410

430

450

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

Mill

ions

$

Fiscal years

Current TransNet forecast (2016-2026)(Year of collection dollars)

Historical data Forecast11

250

270

290

310

330

350

370

390

410

430

450

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

Mill

ions

$

Fiscal years

Current TransNet forecast (2016-2026)(Year of collection dollars)

Historical data Forecast

Forecast +/-5%

12

11

12

Board of Directors | Item 16 | October 25, 2019 7

250

270

290

310

330

350

370

390

410

430

450

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

Mill

ions

$

Fiscal years

Recession scenario

Historical data Forecast 1991 like recession

Forecast +/-5%

13

6 years to recover

Summary

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+ Low unemployment

+ Resilient sectors

+ Record employment levels

- Employment growth slowing

- Housing market slowing

- Global/national recession risks

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