A battle is brewing among Orange County transportation officials and State Sen. Tom Umberg over his proposal to steer state transportation money to a private bus service that takes tourists to commercial attractions around the Anaheim Resort District.

The idea, now a bill proposal in Sacramento, has aroused opposition from Orange County Transportation Authority (OCTA) staff who warn it could come at the expense of actual public transit services, like buses, countywide.

Over the years, a majority of Anaheim’s elected officials have pushed subsidies for the resort and its commercial interests – a decades-old debate about whether local taxpayers should stake nearby luxury hotel developments, professional sports teams and theme parks – while consistently resisting calls to institute tighter taxes on these interests, through things like gate admission at Disneyland. 

As much as $26 million in state transportation funding that currently goes to OCTA could instead go to the private resort service, officially known as Anaheim Resort Transportation, according to early research estimates by OCTA staff, documented in reports to its own Board of Directors.

By Umberg’s count? No more than $900,000.

Responding to questions in a written statement last week, Umberg said his bill is nascent and subject to further amendments, adding it was submitted early so his team could meet a deadline for new bill proposals in February.

Yet OCTA spokesman Joel Zlotnik called the idea “unprecedented” in a phone interview last Monday – an idea which takes “transit funding from public transit riders in Orange County and gives it to private interests.”

Requests for comment from Anaheim Mayor Harry Sidhu, who sits on OCTA’s Board of Directors, went unreturned as of Friday.

On the Anaheim Transportation Network’s Board of Directors is Republican Party of Orange County Chairman Fred Whitaker, who acts as legal counsel. 

He declined to comment on Umberg’s bill, which critics say would constitute a government subsidy for private business, pointing a reporter instead to Anaheim Resort Transportation spokesperson Diana Kotler. 

OCTA doesn’t recognize the resort bus service and its board as a public transit agency, even as the service makes stops at five other cities near Anaheim.

That’s mainly because Anaheim Resort Transportation’s foundational task is to serve customers of the resort area. 

Yet Kotler in a Friday phone interview rejected the notion that her organization is “private.”

“We are not a private operator. I know that there is an understanding there that we are a private operator, we’re not. We’re a public transit system that is recognized by the federal government as a public transit system. We operate under … an ordinance under the City of Anaheim. So that makes us 100% a public operator for the constituents who we serve,” Kotler said. 

The notion that Anaheim Resort Transportation serves private interests largely comes from Anaheim Resort Transportation itself, in one 2012 restructuring study, for example.

The resort transportation network “is a private non-profit transportation management association governed by a Board of Directors including members from The Walt Disney Company, the City of Anaheim, major local hotels, and the Anaheim/Orange County Visitor & Convention Bureau,” it reads. 

“ATN was established specifically to serve the transportation needs of The Anaheim Resort and the Platinum TriangleTM, as well as to support The Anaheim Resort Specific Plan to reduce traffic congestion and air quality impacts in the area,” it adds.

It would be “unprecedented” to “directly take transit funding from public transit riders in Orange County and give it to private interests,” Zlotnik said. 

“Our concern is that this takes taxpayer money intended to serve OCTA bus riders, and gives it to a company that serves hotels, parking lots, and guests of the Anaheim Resort District,” he added.

The transit network was born out of necessity for the resort area. All the visitor traffic coming into town had congestion and air quality impacts – impacts which needed to be mitigated. 

Anaheim Resort Transportation, previously known as the Anaheim Transportation Network before a re-branding, is meant to be that mitigation.

Kotler acknowledged what she called the transit system’s “original intent” when founded in 1995, but argued it has “very much expanded to serve beyond the original resort core and to support not only the traveling public but also the residents of our communities that surround the resort and … employees of the Anaheim Resort to make sure that they have a viable opportunity to get to work.”

The agency now offers rail feeder services, both at ARTIC and the Anaheim Canyon Metrolink station, for example, and has extended its services for cities outside Anaheim, like Buena Park, Kotler said.

“It provides a comprehensive transportation solution to the resort … It provides a holistic, complete transportation solution for those businesses,” Kotler said, claiming “that’s what transportation services do. That’s what public transit operators provide. They provide mobility and transportation needs, that support the economic development of their cities.”

Yet Anaheim Resort Transportation’s Board of Directors does not consist of elected officials – rather, they’re resort hoteliers, as well as representatives of Disneyland, Angels Baseball, the Honda Center, and other hospitality organizations. 

The City of Anaheim does have a seat – but it’s filled by a City Hall staffer, the Deputy Director of Convention, Sports & Entertainment.

Around 88% of ATN’s ridership lives outside of Southern California, with 64% of ATN’s ridership living outside the state. Around 93% of trips on ATN were for vacations or attending conventions.

That’s all according to the data OCTA staff included in their report, which they say came directly from the resort transit agency.

While it’s unclear just how much money the resort transit system would qualify for, if the bill’s even approved, Zlotnik said it “could potentially mean not operating OCTA service within the areas of Anaheim that (Anaheim Resort Transportation) operates.” 

“And these are some of our most heavily traveled routes that serve many of Orange County’s most disadvantaged communities,” Zlotnik said.

Umberg, in his statement, called the idea “a placeholder bill” with the ultimate purpose of making the resort buses “a publicly accountable and overseen transit agency.”

The goal is to allow the resort buses “access a small portion of state funds” and “ensure that the bill does not result in a net loss of funds to Orange County,” Umberg said in his statement. 

There’s another goal – “Anaheim and its neighboring communities have historically not been a priority service for OCTA,” Umberg’s statement claimed, calling his bill an effort to “increase the total overall transportation dollars for Orange County.”

Without Anaheim Resort Transportation, Kotler said, the transportation needs of communities around the resort area “wouldn’t have been fulfilled” under OCTA.

Zlotnik, responding to the notion that Anaheim is underserved by OCTA, said 23 of OCTA’s 52 bus routes – “nearly half” – operate within the city of Anaheim. Anaheim also has the second most boardings of any city in the county behind Santa Ana.

Of the $26 million in state funding that OCTA staff initially estimated would be lost to the Anaheim Transportation Network, only $900,000 is based on “new revenue” to Orange County, reads an agency staff report from February. 

Umberg says he only wants $900,000 going to the Anaheim Transportation Network in total. 

“We have worked, and will continue to work, diligently with OCTA to ensure that the bill does not result in a net loss of funds to Orange County,” he said.

Yet, even by limiting the resort buses’ state funding to $900,000, Zlotnik said that’s money that would otherwise go toward the countywide transportation authority. 

The bill “would still be unprecedented and divert funds from public transportation to a non-profit that primarily serves private interests,” Zlotnik said in response to Umberg’s statement last week. 

He also disputed Umberg’s notion that Anaheim is underserved by the public bus system. 

“We have not heard anything to this effect from Anaheim, surrounding cities or stakeholders. In fact, over the past number of years … through OCTA Board actions, service into the core of the county has been increased, including in Anaheim,” Zlotnik said.

He added that if anyone has issues with OCTA service, “the appropriate way to address this would be to reach out to OCTA.” 

“Not introduce legislation to create a new public transit agency.”

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