Transportation funding: Greenhouse Gas Reduction Fund: Motor Vehicle Fuel Account.

Senator Strickland's transportation funding measure redirects 25% of California's annual Greenhouse Gas Reduction Fund proceeds from high-speed rail projects to the Motor Vehicle Fuel Account starting in fiscal year 2026-27. The legislation terminates the continuous appropriation to the High-Speed Rail Authority on June 30, 2026, and transfers those funds to transportation purposes through December 31, 2030.

To maintain revenue neutrality, the bill establishes an annual mechanism to reduce motor vehicle fuel tax rates proportionally to the amount transferred from the Greenhouse Gas Reduction Fund. The California Department of Tax and Fee Administration must calculate this reduction percentage each June based on the previous year's fuel tax collections and projected fund transfers. This adjustment applies to taxes on fuel removal, entry, and sales within California.

The measure preserves other existing allocations from the Greenhouse Gas Reduction Fund, including dedicated funding for transit programs, affordable housing initiatives, sustainable communities, and forestry projects. The tax rate adjustment provisions expire on April 1, 2031, unless extended by subsequent legislation.