MCAG considers diverting funds from Los Banos Bypass project

A dispute brewing over the allocation of regional transportation fees will come to a head during a Merced County Association of Governments meeting today.

Regional Transportation Impact Fees, established by the association in 2005, are paid by developers of new commercial or residential structures to fund transportation projects. The total stands at $9.6 million as of March, according to MCAG spokeswoman Lori Flanders.

Merced County as well as the cities of Merced, Atwater and Gustine have paid into the program since it began. Dos Palos and Los Banos are participating in the fees for residential developments only.

The money collected was earmarked for the $431 million Los Banos Bypass project per a 2011 resolution, but an item on today’s agenda may change that. The 2011 resolution was reached after officials used $7.4 million of the collected fees for the Atwater Merced Expressway project.

“They gave us that resolution, and they’re now saying it’s worthless,” said Los Banos Mayor Mike Villalta. “Our money continually gets reprogrammed. They keep telling us we’re the No. 1 (priority), but we’re treated like No. 2.”

Officials said the money is needed to apply for a grant to fund another construction project, the Campus Parkway, which will connect Highway 99 and UC Merced. They want to apply for the TIGER grant, which stands for Transportation Investment Generating Economic Recovery, but it requires a 20 percent match.

If the action is approved at today’s meeting, about $3 million of the transportation fees would go toward the TIGER grant match, Flanders said. The rest of the money would come from Merced, UC Merced, Merced County and the state.

District 2 Supervisor Hub Walsh requested either rescinding or suspending the 2011 resolution.

Walsh said the TIGER grant is intended for projects that are “shovel-ready” and the Los Banos Bypass project isn’t there yet. The three-phase project aims to bypass about eight miles of Highway 152 going through Los Banos

“The only shovel-ready project I’m aware of is the Campus Parkway,” Walsh said. “It seems appropriate that we at least go forward with it.”

Villalta said Los Banos has contributed $1.7 million in regional transportation fees but hasn’t gotten its share of funding for construction projects. The city pulled out of paying the fees for commercial businesses in 2012 for that reason, the mayor said.

On the flip side, Walsh pointed out that the city of Merced has put $4.4 million into the pot and the county has contributed $3.9 million.

The MCAG meeting will be held at 3 p.m. in the Board of Supervisors chamber on the third floor of the Merced County Administration Building, 2222 M St.