SB 695 adds Section 14053 to the Government Code, directing the California Department of Transportation (Caltrans), in consultation with the California Transportation Commission (CTC) and the Transportation Agency, to produce an annual prioritized list of “projects of statewide and regional significance” that improve resilience of the state highway system to extreme weather and other disasters. The bill sets a statutory definition for eligible projects, lists cobenefits that raise a project’s priority, and limits the list to projects that have reached a specified level of project development.
The statute creates two related deliverables: the prioritized list (due July 1, 2026, and annually thereafter) and an annual legislative report (due January 1, 2027, and each year after) filed in the format required by state reporting law. For planners, freight stakeholders, utilities, and regional agencies, the new list becomes a formal state signal about which highway projects are considered top candidates for resilience investments and cross‑sector coordination.
At a Glance
What It Does
Caltrans, working with the CTC and the Transportation Agency, must create a prioritized, annual list of state highway projects that serve two or more counties and strengthen resilience to climate and natural disasters; the law ranks projects by defined cobenefits and restricts eligibility to projects at planning or later stages of development.
Who It Affects
Directly affects Caltrans, the CTC, and the Transportation Agency as authors and reviewers of the list; it also affects regional transportation planning agencies, counties that host state highway corridors, freight operators, utilities involved in grid transmission, and Legislature staff who receive the report.
Why It Matters
By codifying a statewide prioritization and an annual legislative report, the bill formalizes a statewide resilience agenda for the state highway system, signals which project types the state values, and creates a durable planning document that can influence grant selection, interagency coordination, and the sequencing of environmental and design work.
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What This Bill Actually Does
SB 695 creates a focused, repeatable process for surfacing state highway projects that the state judges important for climate resilience and disaster preparedness. It confines the scope to highways on the state system that materially affect more than one county, and it sets both substantive and procedural bars: eligible projects must advance safety or economic mobility objectives and also address climate‑related vulnerabilities or disaster risks.
That two‑part definition narrows the universe to multi‑county corridors with both transportation significance and exposure or adaptation value.
The bill instructs Caltrans to prioritize projects that deliver multiple cobenefits—safety, efficient goods movement, climate resiliency (including water or flood mitigation), and improvements to electric transmission for grid reliability—and to give higher priority to projects that score across more than one of those categories. Importantly, the statute excludes projects that remain at the very early concept stage by requiring that projects be at least in planning/environmental/design or further along before they can appear on the list.Practically, the statute creates two annual milestones: a mid‑year prioritized list and a follow‑up legislative report in the form required by state reporting rules.
The consultation requirement with the CTC and the Transportation Agency means the list is not a unilateral agency product; it is a coordinated statement of statewide priorities that can be used by state and regional funders, by project sponsors preparing grant applications, and by agencies seeking to align permitting or mitigation efforts.Because the bill explicitly calls out electric transmission and water‑related resilience measures among cobenefits, it pushes Caltrans to engage non‑transportation agencies and utilities earlier in project planning. That cross‑sector framing changes what a “transportation resilience” project can look like: expect more packaged projects that combine roadway elevation, culvert and drainage upgrades, and utility coordination for grid reliability.
The Five Things You Need to Know
SB 695 defines a “project of statewide and regional significance” as a state highway project that benefits two or more counties and meets both a transportation benefit test (safety or economic mobility) and a climate/disaster vulnerability or mitigation test.
Caltrans must produce the first prioritized list by July 1, 2026, and update it annually; only projects at the planning/environmental/design stage or beyond are eligible for inclusion.
Priority is driven by cobenefits; projects that yield multiple cobenefits—safety, goods movement, climate resiliency (including water/flood actions), and electric transmission improvements—rank higher.
The bill requires Caltrans to submit an annual report containing the prioritized list to the Legislature by January 1, 2027, and each January thereafter, and the report must comply with the state’s reporting format requirements (Section 9795).
The statute mandates consultation with the California Transportation Commission and the Transportation Agency in assembling the list but does not itself create new funding or penalty mechanisms tied to placement on the list.
Section-by-Section Breakdown
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Why the Legislature created this list
This opening section states the Legislature’s view that California’s transportation infrastructure is increasingly at risk from climate‑related disasters and that proactive investment reduces longer‑term costs and service disruptions. The findings frame the list as an instrument to promote projects that protect mobility, safety, and economic activity and justify prioritizing multi‑county, high‑impact interventions rather than purely local fixes.
What counts as a project of statewide and regional significance
Subdivision (a) sets a two‑part eligibility test: the project must (1) benefit at least two counties and advance safety or economic mobility on a major corridor, and (2) address climate resilience or a natural‑disaster vulnerability. This narrows eligible projects to multi‑county state highway corridors with both transportation and resilience rationale, excluding single‑county fixes and projects that lack a documented climate or disaster component.
How projects are prioritized
Subdivision (b)(1) requires Caltrans to create a prioritized list and to weigh a short menu of cobenefits—enhanced safety, efficient goods movement, climate resiliency measures (explicitly including water storage and flood mitigation), and electric transmission improvements. The statute gives greater priority to projects delivering multiple cobenefits, effectively encouraging integrated solutions that cross traditional agency boundaries.
Minimum project development stage to be listed
Subdivision (b)(2) restricts the list to projects in either the project approval and environmental documentation stage, or the planning/environmental/design stage, or further along. This is a de facto ‘shovel‑ready’ filter: projects still at purely conceptual stages cannot be prioritized, which favors sponsors with existing environmental work or approved designs and may accelerate funding‑readiness sequencing.
Annual reporting format and deadline
Subdivision (c) requires Caltrans to deliver the prioritized list to the Legislature in an annual report due January 1 (beginning 2027), and it explicitly requires compliance with the state’s reporting template rules (Section 9795). The statute also disapplies Section 10231.5 for this report timing, creating a fixed legislative oversight vehicle without creating new budgetary authorities.
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Who Benefits
- Freight operators and major shippers — corridors that improve goods movement are prioritized, which can reduce delay and supply‑chain risk on multi‑county routes and attract state attention and coordination.
- Counties and regions with multi‑county corridors — projects that span jurisdictions gain a pathway to statewide recognition and interagency coordination, making it easier to marshal state technical support and align funding applications.
- Communities vulnerable to repeat flooding, wildfires, or other disasters — the cobenefit emphasis on resiliency and water/flood actions directs resources toward adaptations that reduce repeated repair and service interruptions.
- Grid operators and electric utilities — by naming electric transmission improvements as a cobenefit, the bill creates an explicit role for utilities and grid reliability projects in the transportation resilience conversation, potentially smoothing permitting and siting coordination.
- Regional transportation planning agencies and MPOs — the formal list becomes a planning tool that MPOs can cite in grant proposals and regional plans to demonstrate alignment with state resilience priorities.
Who Bears the Cost
- Caltrans — the department must absorb the staff time and analytic work to identify, vet, and prioritize projects annually and to produce a statutorily formatted report, potentially diverting resources from other program work unless funded.
- Local sponsors and MPOs in underresourced jurisdictions — the eligibility threshold (planning/environmental/design completed) favors sponsors with capacity to advance projects to those stages, imposing an implicit cost on jurisdictions that must accelerate planning outlays to compete for priority status.
- Utilities and grid operators — coordination costs will rise where transmission work is packaged with highway resilience components, and utilities may need to invest in upgrades or joint design work without a guaranteed funding source under the bill.
- The Legislature and oversight staff — receiving and evaluating annual lists will create legislative workload; if the list becomes the basis for funding decisions, legislative staff will need to reconcile it with budget and grant processes.
- State permitting and environmental regulators — more cross‑sector projects increase the complexity of environmental review and permitting, potentially stretching agency review capacity and timelines.
Key Issues
The Core Tension
The bill balances a statewide, evidence‑based push to concentrate resilience investments on multi‑county, high‑impact corridors against the risk that prioritization will favor projects that are already planned and sponsored by better‑resourced jurisdictions; in short, it privileges readiness and multi‑benefit outcomes but may do so at the expense of equity and locally urgent—but less prepared—projects.
SB 695 centralizes visibility for certain multi‑county highway projects but stops short of creating new funding streams or tying placement on the list to grant awards. That means the list’s practical power depends on how the Legislature and state programs choose to use it: the list can influence funding priorities, but the statute itself creates no automatic funding channel.
This leaves ambiguity about whether listing will accelerate construction or merely reframe project rankings.
The bill’s cobenefit approach promotes integrated projects but raises jurisdictional and technical challenges. Electric transmission upgrades and water storage measures fall outside Caltrans’ traditional portfolio; successful delivery will require new memoranda of understanding, joint environmental reviews, and closer ties to utilities, DWR, CPUC, and grid operators.
The statute does not prescribe metrics for comparing cobenefits, so Caltrans will need to develop a defensible scoring system; without transparent metrics, the prioritization risks appearing subjective or biased toward projects with stronger planning teams rather than those with greatest community need.
Finally, the stage‑of‑development eligibility favours projects that are already advanced, which accelerates implementation for well‑resourced sponsors but can disadvantage rural or disadvantaged communities that lack planning capacity. The law creates a tension between speed (favoring ready projects) and equity (prioritizing the most vulnerable locations), and it leaves unresolved how to ensure geographic and socioeconomic balance in the annual lists.
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