Loading...
HomeMy WebLinkAboutItem B , ceak---geacg .. P OQ %NTY, CITY HALL • 211 EIGHTH STREET SEAL BEACH, CALIFORNIA 90740 6379 (562) 431-2527 March 23 , 1999 Forwarded is a certified copy of Resolution Number 4697 in support of Assembly Bill 24 and Senate Bill 165, offering local government fiscal relief. Resolution 4697 was unanimously adopted by the Seal Beach City Council at a regular meeting thereof held on March 22nd, 1999 . The City Council of Seal Beach strongly supports both AB 24 and SB 165 and urges adoption of this legislation. On behalf of the City of Seal Beach, thank you for your attention and consideration. Very truly yours, Joanne M. Yeo, City Clerk City of Seal Beach Attach. .0-lEot 8 SEA1' r�'� cARPO�r qty, MEMORANDUM 6.tir Q reNeR 04,��0= Date: February 21, 1999 To: Mayor and Members of the City Council From: Shawn Boyd, Council Member Subject: Council Resolution in Support of AB 24 and SB 165 Please find attached a very brief summary of AB 24 and SB 165 as contained in the League of Cities"Legislative Bulletin". Consistent with the League's recommendation I am requesting we adopt a resolution of support for these two measures and forward the resolutions to our state legislators. These two pieces of legislation are important steps to correcting the significant loss of local revenue via property tax shifts that occurred in the early 1990's and returning the revenue to local agencies. If enacted,this would assist in returning to our city the lost revenue that forced the increase in the utility users tax. I have contacted the Orange County Division of the League for assistance with a resolution specific to our concerns. Please contact me with any questions. PC: Keith R. Till, City Manager Quinn Barrow,City Attorney Attachment /sb AIMI, Bill AB 24 Information Page 1 of 2 :' 4Caiifarnia State � ate :0,:w0:-.Home S+rtatore Lei siation Gortradttees. SCh2i u11s OffteeeiCautlusee Aud1&TV F:. Subscribe Current Session Legislation- sill Info AB 24 - Local fiscal relief: property tax revenue allocation Past Sessions by Assemb. Maddox Codes Statutes • Status: Status, AB 24, as of 1999-03-04 — (text) • History: History, AB 24, as of 1999-03-04 — (text) Constitution • Current: AB 24, Introduced 1998-12-07 [13.5101 — (text) • Introduced: AB 24, Introduced 1998-12-07 [13.5101 — (text) All bill related documents: • AB 24, Introduced 1998-12-07 [13.510] — (text) excerpt from Local fiscal relief:property tax revenue allocation text... This bill would, except as otherwise provided with respect to amounts attributable to community colleges, prohibit a county auditor, for the 1999-2000 fiscal year and each fiscal year thereafter, from allocating to that county's ERAF a total amount of ad valorem property tax revenue greater than the amount allocated from that fund to school districts and the county office of education for the 1998-99 fiscal year. This bill would require any reductions resulting from these provisions in the amount of revenues deposited in a county's ERAF to be exclusively applied to reduce allocations from that fund to school districts and the county office of education. Subscription to Bill AB_24 11 You may subscribe to any changes or additions to bill AB 24 by providing us with your e-mail address. We will send the information directly to you. Address: http://www.sen.ca.gov/htbin/testbin/ca-billpage?...:[BILL.CURRENT.AB.FROM0000.AB0024 3/10/99 Bill AB 24'Information Page 2 of 2 Subscribe (sends you a copy of each change) (' Notify (sends notification of each change) B 24 Search for Bills Similar to Local fiscal relief:property tax revenue allocation Enter one or more keywords to search for 'LOCAL and FISCAL and RELIEF and PROPERTY and Run the search . :. =` ``' ' or reset the request n>« <:;•��:>.:I Search for Bills Authored by Maddox ::.::................ Home Senators Legislation Committees Schedules Offices/Caucuses Audio/TV Faqs/Links Please send any questions or comments about this site to WebMasterAsen.ca.gov http://www.sen.ca.gov/htbin/testbin/ca-billpage?...:[BILL.CURRENT.AB.FROM0000.AB0024 3/10/99 Bill SB 165 Information Page 1 of 2 '7411Caltiornia State Senate. Home Senators.Legislation Co xtur ttises Satedules Offiees!Caueuses AUdI&TV F Subscribe Current Session Legislation-- Bill egislationBill Info SB 165 - Local government finance: property tax revenue Past Sessions allocation: local agency relief Codes by Senator Rainey Statutes • Status: Status, SB 165, as of 1999-01-23 — (text) Constitution • History: History, SB 165, as of 1999-01-21 — (text) • Current: SB 165, Introduced 1999-01-11 [13.5KB] — (text) • Introduced: SB 165, Introduced 1999-01-11 [13.5KB1 — (text) All bill related documents: • SB 165, Introduced 1999-01-11 [13.5KB1 — (text) excerpt from Local government finance:property tax revenue allocation: local agency relief text... This bill would modify these reduction and transfer requirements, commencing with the 1999-2000 fiscal year, by requiring that each reduction and transfer amount calculated for a local agency in a county be annually reduced in accordance with an unspecified schedule, and that the revenues not allocated to the county's Educational Revenue Augmentation Fund as a result of these reductions be instead allocated among the local agencies in the county, as provided. By imposing new duties in the annual allocation of ad valorem property tax revenues, this bill would impose a state-mandated local program. Subscription to Bill SB_165 You may subscribe to any changes or additions to bill SB 165 by providing us with your e-mail address. We will send the information directly to you. Address: http://www.sen.ca.gov/htbin/testbin/ca-billpage?S...:[BILL.CURRENT.SB.FROM0100.SB0165 3/10/99 Bill SB 165 Information Page 2 of 2 Subscribe (sends you a copy of each change) C Notify (sends notification of each change) iiiiMiNiiiiiinigagianStitifiri:imim 1sB 165 Search for Bills Similar to Local government finance:property tax revenue allocation: local agency relief Enter one or more keywords to search for [LOCAL and GOVERNMENT and FINANCE and PROPERTY Run the search4«»>1\s1 or reset the request `1 ` Search for Bills Authored by Rainey • Home Senators Legislation Committees Schedules Offices/Caucuses Audio/TV Faqs/Links Please send any questions or comments about this site to WebMaster@u,sen.ca.gov http://www.sen.ca.gov/htbin/testbin/ca-billpage?S...:[BILL.CURRENT.SB.FROM0100.SBO 165 3/10/99 ktaNCOMOUNNEW iaMilliffignitiiiitialfigigniMINISIVI {•}),Y F..<&":4. �'EfS���r✓•++' >f� ./..r.'.,�„�.. `f`` �'Y yif?r Y r}f}•"•{�fvf. YfJ2,�URI a %G;2+v' t'+"`,t,fF<„�c+.314:.: '' ,o-S c• :';�:.. '/fl f r\ )p:...�$::i+'tik I Y+C�n4C.J.yI� r'C•Y/.,C:..:::...f•� :R'. }' �Cf r {� �"� �;:Yy'n''? f +•j•gyp: ' Yf. •v. nr.:Yy�Y,v,finr{•: , i.: :{/ i +�' ,. .. ' . ti. .,� vh ,J'.4t jii{:j:: ie''' ,YY}'{'' a . ..'f.,�2��'� ':.i}qY:':.i:•`q'i gv yt �}y� `:{r. .\•. v\:} iiiii :ti:�.�hk: :}. Ye : .r ' �. at :tit} �r'Q� £ t� v�+ ''R•,Y0:-.' fi C'.'s:h„ �Y :i +� y^ :•:a;r.:•ff$,{ky,Y. £ \'• • r• •:*: ..:: • ::jr:?: ';k:{i:i:�a:•.�io}:$6•nws'.tSw4CC :\.• }�G acs{ .. Y• :,a{ �.�/,�x�' :rte?: '°'' •}. f \ \. i:ik;Y:>`,tij:<�tii; :,SfSS>;:{:4?i:ti;.iirt�::ii:, y �'}{fi.£i•{'i�i:•:;'ii:{•}YFSF \ ` yp 4��;.' i\ ?\4f+ �\ f% 1 ti��$�M1..� •:Y\ii•.tu•.vri•:^:::f:: : •Yti3:.v::::w:•::y:Y:::::..:.\\,.,:••• ,..t.: ':'yid'iitiir:v.C::s+f+iY:•, .G }Y\•}Kvfrr } ?ti•Ki•Y�}::Ch,•.w:.vf'f.•:f!:ri::i}i,v. ,.^.v:{4Y:•:•\'{<;?.}:i?i•:{,. ?.. •t':� :��\�?�\ii�tiv�.\{{.:{,+.v:\vn .�\�^!„i,fi\\'i{4i{:iS +:.......... .. #7-1999 February 19, 1999 Legislative Analyst Issues Report on State and Local Government Finance, Examining Property Tax Shifts in Early 1990's; Report One of Many Debate Centers on Local Government Finance; All Remains Flexible on a Local Government Finance Solution. The League office has received several inquiries from city officials in regard to the recent Legislative Analyst Office (LAO)report on local government finance. The report is entitled, "Shifting Gears: Rethinking Property Tax Shift Relief." The report examines the primary centerpiece over the debate about local government finance: the shift of property taxes from cities, counties and special districts to the benefit of the state general fund in 1992-93 and 1993- -, 94. The report is also intended to address the"mitigation" of the lost property taxes that was mentioned in the Governor's 1999-2000 proposed budget. The report begins by making the following observations: 1. This year, the property tax shift redirected nearly one-in-five property taxes, or$3.6 billion, from local governments to schools. This is done through an "accounting" mechanism termed the Educational Revenue Augmentation Fund (ERAF). [Editor's Note: While the shift is to schools, through the ERAF accounting method, the ultimate beneficiary of the shift is the state's general fund that is relieved of having to contribute this amount of money to the schools]. 2. About 13 counties and one-in-five cities appear to be"net winners" from the shifts and mitigation measures. That is, these local governments received more funds from the mitigation measures than they lost from the property tax shift. The remaining local governments are net losers. No apparent policy basis underlies these different fiscal effects. [Editor's Note: The "mitigation measures" referred to include the Proposition 172 moneys, i.e., sales tax approved by the voters; trial court funding relief for the counties; fines and forfeitures for cities and counties; and, a number of other measures mostly directed at county government]. 3. Allocating relief to mitigate each local government's property tax shift losses, would be difficult from a technical standpoint and would raise significant policy questions. [Editor's Note: The report goes on to point out that some local governments that are"winners" under the property tax shift would be rewarded further under any proposal to return the property tax to the local governments from where it came]. ii The Legislative Analyst report recommends that the Legislature move beyond the property tax shift debate. It is an issue that is predicated on a seriously flawed system of public finance. The problems inherent in reinforcing the existing system of local government finance, according to the Analyst include: 1. State government, rather than local communities, would continue to control virtually all sources of local government revenues, including most local sales taxes, property taxes, vehicle license fees, and Proposition 172 revenues. Distribution of these funds would continue to be vulnerable to annual state fiscal actions. 2. Californians' property taxes would still be distributed to local governments based on the preferences of residents living in their area more than 20 years ago. Current residents and locally elected officials would continue to lack any authority to redirect their tax revenues to meet local objectives. Thus, property taxes in a community might continue to be distributed to water districts and cemetery districts, even if current residents would prefer that their taxes pay for more city or library services. 3. The assignment of program responsibilities between state and local government, and among California's many local governments, would continue to be obtuse and difficult for residents to understand. Residents would continue to have difficulty determining which level of government to hold accountable for program outcomes. California cities and counties would continue to face counter-productive incentives to shift costs to other local governments. The Legislative Analyst concludes: 1. Use any "shift relief' funds to transform California's system of local finance into one that reflects modern needs and preferences of local communities and that encourages local governments to work together. [Editor's Note: This is apparently a reference to any "excess" or "surplus" funds available in the upcoming budget debate. Please see attached articles from the Sacramento Bee on the "surplus" issue]. 2. In our view, the provision of local funding should not be predicated on a calculation of what one level of government owes the other, but upon the possibility for improving California's flawed system of local government finance. What Does This All Mean? The Legislative Analyst report is an excellent analysis of the property tax shift issue and the greater issue of a dysfunctional state and local government finance system. The Legislative Analyst is carrying out its duty to be a rational policy voice on key legislative issues; local government finances certainly being a key issue. The report should not, however, be construed, as some have depicted it, as the nail in the coffin of the ERAF/ property tax debate. It is an approach to the issue that should be considered along with all the other ideas, proposals and debates on the issue. There are many ideas"out there" and it is very early in the state budget process, especially for local government finance issues that always seem to be the last issues to be resolved. While the LAO report is a rational look at the problem, remember that the rational solutions are often the most difficult politically. To make any meaningful progress on local government finance, #7 2 2/19/99 there are some very high and difficult political hurdles that have to be overcome. In the end, it will be the easiest political route that will be taken; and, that may mean a solution that simply modifies an already flawed system simply because it is the easiest to achieve. The report can be obtained by calling (916) 445-2375 or through the LAO's Internet sit at http://www.lao.ca.gov. The LAO office is located at 925 L Street, Suite 1000, Sacramento, California, 95814. AA AAAAAAAAAAAAAAAAAA LEGISLATIVE ACTIVITIES 1. AB 240 (Honda). Public Employees. Agency Shop. Oppose. 2. SB 32 (Peace). Workers' Compensation. Public Safety Officers. Hepatitis Presumption. Oppose. 3. SB 36 (Baca). Veteran's Preference. Local Agencies. Oppose. 4. SB 38 (Baca). Religious Freedom Protection Act. Watch. AA AAAA A A AA A A A AA AA Ann LEGISLATIVE ACTIVITIES 1. AB 240 (Honda). Public Employees. Agency Shop. League Position: Oppose Bill Status: Assembly Public Employees Retirement and Social Security Committee Action: Contact Committee Members and Request a NO Vote What the Bill Does: Permits the negotiation of an agency shop agreement (i.e., mandatory union dues payment) for management, confidential and supervisory employees. Reasons for the League's Position: Management, confidential and supervisory employees should not be covered by an agency shop agreement. Agency shop agreements apply to rank-and- file union members and not employees who are a part of the management structure of the city. Background: The Meyers-Milias-Brown Act(MMB) is the law that governs public sector collective bargaining for cities, counties, and special districts. Unlike the laws that govern collective bargaining for schools, the state, higher education in California and the National Labor Relations Act, the MMB does not define management, confidential and supervisory employees for the purposes of collective bargaining_ This means that there is not clear definition of who is on the labor side of the collective bargaining table and who is on the management side of the table. As a result, public sector unions have organized some collective bargaining units that include these management, confidential and supervisory employees. Under the law, even a city manager #7 3 2/19/99 can be a member of a bargaining unit. This is unique to the MMB and raises some serious questions about the proper balance needed at the collective bargaining table. Many practitioners argue that this lack of definition is a disadvantage to management. In the early 1980's, the MMB was amended to provide agency shop as a negotiable item for rank- and-file public sector unions. The amendment specifically excluded management, confidential and supervisory employees from the authorization to negotiate agency shop. This exclusion was added even though no definition was in law as to what constituted a management, confidential or supervisory employee. Since that time, the collective bargaining process has moved along as expected. AB 240 now proposes to amend the MMB and allow the negotiation of agency shop for management, confidential and supervisory employees. This would give these employees, where they are organized, greater financial resources to use in the collective bargaining process against the management of a public agency of which they are supposed to be a member. In no other collective bargaining law in California do management, confidential, and supervisory employees have the right to negotiate agency shop. They should not be given this right under the MMB. Known Support: American Federation of State, County and Municipal Employees and likely other public sector employee organizations. Known Opposition: League of California Cities. (See Committee membership after Legislative Activities in this Bulletin.) [League Staff: Dwight Stenbakken] 2. SB 32 (Peace). Workers' Compensation. Public Safety Officers. Hepatitis Presumption. League Position: Oppose Bill Status: Hearing: Wednesday, February 24, Senate Industrial Relations Committee Action: Contact Committee Members and Request a NO Vote on SB 32 What the Bill Does: Provides for firefighting and law enforcement personnel that hepatitis developing or manifesting itself during a period of service to an employer, is presumed to be the result of the person's job. To implement this presumptive injury the bill also requires the following: 1) The presumption shall be extended to a person following termination of service for a period of up to three calendar months for each full year of service, but not to exceed 60 months in any circumstance. 2)The hepatitis developing or manifesting itself in those cases shall in no case be attributed to any disease existing prior to that development or manifestation. 3) The compensation that shall be awarded for hepatitis shall include, but not be limited to, full hospital, surgical, medical treatment, disability indemnity, and death benefits, as provided by the workers' compensation laws of California. Reasons for the League's Position: The League has long opposed the establishment of "presumptive injuries" in the workers' compensation laws. The experience with presumptive injuries is that it is virtually impossible to successfully dispute a claim under the law no matter #7 4 2/19/99 how overwhelming the evidence that the"injury" was not the result of a person's employment. A presumptive injury means, in practice, almost automatic compensation. The public employer, and most importantly the taxpayer, should not have to pay for an injury where the public sector job did not contribute to the injury. "Presumptive injuries" should be judged by the same standard of evidence that is required of all other injuries under the workers' compensation system. Background: This proposal is simply another in a long line of attempts, mostly successful, to place and expand the presumptive injuries in the workers' compensation laws, primarily for public safety employees. This measure has been introduced and carried in the Legislature in past years with the most recent version of the bill being vetoed last year by the Governor. Known Support: Public Safety employee organizations. Known Opposition: The League of California Cities. (See Committee membership after Legislative Activities in this Bulletin.) [League Staff: Dwight Stenbakken] 3. SB 36 (Baca). Veterans' Preference. Local Agencies. League Position: Oppose Bill Status: Passed Senate Local Government Committee Action: Contact Senators and Communicate Opposition to the Legislation What the Bill Does: Requires cities, counties and a city and county, general law or charter, that has established a civil services system, to implement a veterans' preference system by January 1, 2002. If the local agency does not adopt veterans' preference system, then it must adopt a resolution identifying reasons that the local agency does not do so. Reasons for the League's Position: This is an unnecessary, albeit small, mandate on local governments. Veterans' preference should be the prerogative of a local agency. It should not be mandated on local government. In fact, many cities have adopted veterans' preferences on their own. The proposal will likely result in no material gain other than more litigation. Background: The author of the bill has carried this legislation on a number of occasions in the past. It has been vetoed by Governor Wilson as recent as last year. Early renditions of the bill were much worse in terms of the scope of the mandate than the current version. The current version is virtually identical to the legislation carried by then Assembly Member Baca. The language in the legislation is somewhat confusing. On the one hand, there is the requirement to either adopt a veterans' preference system or publicly state why the system has not been adopted. Then, the bill goes on to say: "Nothing in this act shall be construed to require a city, county, or city and county, to implement a veterans' preference system. However, it is the intent of the Legislature in enacting this section that cities, counties, and cities and counties, to the extent possible, further the public policy . . . to promote veterans' preference." Not to be a nattering nabob of negativism, but this is the type of legislative drafting that usually ends up in court with local government losing. The bottom line is that the legislation is simply not #7 5 2/19/99 needed. Known Support: Veterans groups. Known Opposition: The League of California Cities. [League Staff: Dwight Stenbakken] 4. SB 38 (Baca). Religious Freedom Protection Act. League Position: Watch Bill Status: Senate Rules Committee, Not Yet Assigned To Policy Committee Action: Notify City Attorneys and Planning Staff, and Be Prepared to Oppose This Bill. SB 38 is drafted as a spot bill on the same topic and by the same author as a bill the League opposed last year: AB 1617 (Baca). Last year, the League opposed AB 1617, the Religious Freedom Protection Act, because, as drafted, it invaded the constitutionally sensitive issue of separation of church and state by establishing a preferential standard for religious organizations when dealing with generally applicable laws. A similar federal law, the Religious Freedom Restoration Act of 1993, was recently struck down by the U.S. Supreme Court in Boerne v. Flores (1997). In Boerne, a church located in a historical district wanted to expand but was rejected by the local planning commission due to the church's location in the historic district. The U.S. Supreme Court rejected both the church's claim and the law upon which it was based. Maintaining a separation between church and state is one of the core constitutional standards on which this nation is built. This bill threatens that long-standing separation by crafting for the state a law that was rejected at the federal level. California should not make the same mistake. AB 1617, which was vetoed by Governor Wilson last year, would have put state and local governments on the defensive against litigation from all manner of individuals and groups claiming various generally-applicable laws impose a substantial burden on their religion. Furthermore, "religion" was vaguely defined as either"an act or refusal to act, that is substantially motivated by sincerely held religious belief whether or not that the religious exercise is compulsory or central to a larger system of religious belief" One can only imagine what will come in through this barn door. As with any such issue that turns on a U.S. Constitutional issue, the fix proposed in the legislation may be worse than current law. It may have the unintended consequence of people using the exception given to religion in the bill to justify acts never intended to be covered. It offers the possibility of causing more litigation with none of the intended impacts on or protections of religion being realized,just as what occurred under the federal law. Be ready to oppose SB 38 (Baca), if language similar to last years AB 1617 is included in the bill. Known Support of Last Year's AB 1617 (Baca): California Coalition for the Free Exercise of 111 Religion (source), American Jewish Committee, American Jewish Congress, Americans United for Separation of Church and State, Anti-Defamation League, Baptist Joint Committee on Public #7 6 2/19/99 Affairs, Buddhist Sangha Council of Southern California, California Church Impact, Church of Jesus Christ of Latter Day Saints, Church-State Council of Seventh Day Adventists, Christian Science Committee on Publication, Episcopal Diocese of Los Angeles,Friends Committee on Legislation, Interfaith Religious Liberty Foundation, Jewish Community Relations Committee of the Los Angeles Jewish Federation, Jewish Public Affairs Committee of California, Justice Fellowship, Lutheran Office of Public Policy, Muslim Public Affairs Council,People for the American Way, Sikh Media Action Resource Task Force, Traditional Values Coalition,Unitarian Universalist Project Freedom of Religion, Associated Chaplains in California State Service, California Correctional Peace Officers Association, Campbell Seventh-Day Adventist Church, Committee on Moral Concerns, Jewish Community Relations Council of San Francisco,the Peninsula, Marin and Sonoma Counties, Legislative Research Incorporated, Religious Action Center of Reform Judaism, American Federation of State, County and Municipal Employees, AFL-CIO, Central Coast California Native American Church,Pacific Union College, California Indian Legal Services,Professor of law Alan Brownstein,UC Davis, Professor Erwin Chemerinsky, USC San Manuel Band of Mission Indians, American Civil Liberties Union, Capitol Resource Institute. Known Opposition of Last Year's AB 1617 (Baca): American Atheists, Inc., State Department of Corrections, Los Angeles City Council, League of California Cities, City of West Hollywood, Westside Civic Federation, Los Angeles County District Attorneys Office, Coalition of Police and Sheriffs, Professor Marci Hamilton,Professor Eugene Volokh, Lambda Legal Defense Fund, National Center for Youth Law, County Welfare Directors Association of California, California District Attorneys Association, California State Sheriffs Association. (See Committee membership after Legislative Activities in this Bulletin.) [League Staff: Daniel Carrigg] AA AAAA AAAAAAA AAA AAAA LIST OF COMMITTEES REFERRED TO IN THIS WEEK'S BULLETIN ASSEMBLY PUBLIC EMPLOYEES,RETIREMENT AND SOCIAL SECURITY COMMITTEE:Correa(DXChair), Thompson(RXVice Chair),Firebaugh(D),Honda(D),Knox(D),and Pescetti(R). SENATE INDUSTRIAL RELATIONS COMMITTEE:Solis(DxChair),Mountjoy(R)(Vice Chair),Alarcon(D),Figueroa (D),Haynes(R),Kamette(D),and Morrow(R). SENATE RULES COMMITTEE:Burton(DXChair),Lewis(R)Vice Chair),Baca(D),Hughes(D),and Knight(R). #7 7 2/19/99 VAR-17-1999 15:57 GESEMBLYM4N KEN lADDG: 916 319 2168 0.02/02 art STATE CAPITOL N.O.BOX 942548 ASStittil� „ `•y SACRAMENTO:CA 84249.0001 (WI 6)319.2068 California lEtgistafurg FAX(916)318.2168 COMYmEES: DISTRICT OFFICE vICE•CHAIR, _� 86ARDEN G Q S y1A1N STROVEEET,SUGA I 9284E tOG KEN.MADDOX LOCAL GOVERNMENT (714`,838-4393 ASSEMeLYMEMBER,SIXTY-EIGHTH DISTRICT UTILITIES AND COMMERCE FAX(7i 4)628-1 499 ENVIRONMENTAL SAFETY AND TOXIC MATERIALS E•Mali Address: W90.Maddoxe aeaorf b)y,Ci.pov AB24 BACKGROUND LOCAL GOVERNMENT RESTORATION ACT OF 1999 State budget shortfalls in 1992-1993 and 1993-94 began a devastating assault on local government funds. in order to reduce its funding obligations to schools, the State shifted $3.6 billion in property tax revenue from cities, counties and special districts to the state's Education Revenue Augmentation Fund (ERAF) This intrusion on local government autonomy continues to this day, forcing local governments to reconcile increasing demands with shrinking budgets. Moreover, the amount of redirected property tax required to be deposited into ERAF increases annually in correspondence to the property tax growth rate. California no longer suffers from recession rather our state enjoys a healthy and robust economy. With such a strong fiscal situation, the state should end this harmful incursion into local government finances. It is essential that local governments be assured that revenue generated locally will be available for local needs. AB 24 caps the amount of property tax revenue transferred to ERAF at the amount transferred in the 1998- 99 fiscal year. This allows local governments to retain the growth in property tax revenue. Importantly; AB 24 protects community colleges from any loss of funding with the inclusion of a backfill mechanism. Pdnad on Ro:yclod P9per TOTAL F.02 MAR-17-1999 15:5. ASSEMBLYMAN KEN MADDOX 916 319 2168 P.01/82 IrrQABQ1(C942669 s�GiNai3 lv \ SACRAMENTO,CA 942490001 r (916)3192086 California Ivii tafurr �+tn FAX(916)319-2168 COMMITTEES: DIST11ICT OFFICE 121133 MAIN STREET,SUITE 100 VICE-CHAIR, GARDEN GROVE,CA 92.40 KEN MADDOX LOCAL GOVERNMENT (714)838.1393 ASSEMBLYMEMBER.SIXTY EIGHTH DISTRICT UTILITIES AND COMMERCE FAX(714)638.1498 ENVIRONMENTAL SAFETY E-Mail Add►vaa: AND TOXIC MATERIALS Ken.Maddoocilassemtly,ca.9w FAX COVER SHEET OFFICE OF ASSEMBLYMAN KEN MADDOX TELEPHONE NUMBER: (916)319-2068 FACSIMILE NUMBER: (916)319-2168 DATE: 3/./7/ q TO: 6/,v6E-R._ L' I7/ of 5c / ( PAGES: o� FAX NUMBER:}& 7 - 3 ` qg5 FROM: Assemblyman Ken Maddox Mark Reeder Sheri Tall Jackie Loughman COMMENTS: —TR_1HR I-L•Avvo/L.) fro bujZ _ 17157Pi e-r Q F;ri c.0 "15 'pi 7 / F4 7/fi/s n god . If you experience any trouble receiving this fax, please call (916) 319-2068. Printer/on Aecyaled Pwer PAGE 1 Display 7.999-22000 Bill Text - I10RMATtCN S=LL NUMBER: AB 24 BILL TEXT INTRODUCED SY Assembly McMters Maddox, Bates, and Runner DECEMBER 7, 1998 An act to amend section 41204.1 of the Education Code, and to add Section 97.52 to the Revenue and 'taxation Code, relating to local government. LEGISLATIVE COUNSEL'S DIGEST AB 24, as introduced, Maddox. Local fiscal relief: property tax revenue allocation. Existing property tax law requires the county auditor, ,.n each fiscal year, to allocate property tax revenues to local jurisdictions in accordance with specified formulas and procedures, and generally requires that each jurisdiction be allocated an amount equal to the total of the amount of revenue allocated to that jurisdiction in the prior fiscal year, subject to certain modifications, and that jurisdiction's portion of the annual tax _J.ncreeent. as defined. Existing property tax law reduces the amounts of ad valorem property tax revenues that would otherwise be annually allocated to the county, cities, and special districts pursuant to these general allocation provisions by requiring, for purposes of determining property tax revenue allocations in each county for the 1992-93 and 1993-94 fiscal years, that the amounts of property tax revenue deemed allocated in the prior fiscal year to the county, cities, and special districts be reduced in accordance with certain. formulae. =t requires that the revenues not allocated to the county, cities, and special districts as a result of these reductions be transferred to the Educational Revenue Augmentation Fund (ERAF) in that county for allocation to school districts, community college districts, and the county office of education. This bill would, except as otherwise provided with respect to amounts attributable to community colleges, prohibit a county auditor, for the 1999-2000 fiscal year and each fiscal year thereafter, from allocating to that county's ERAF a total amount of ad valorem property tax revenue greater than the amount allocate' from that fund to school districts and the county office of education for the 1998-95 fiscal year. This bill would require any reductions resulting from these provisions in the amount of revenues deposited FAGF 2 Display 1999-2000 Bill Text - INFORMATION BILL NUMB R: AB 24 BILL TEXT in a county's ERAS to be exclusively applied to reduce allocations from that fund to school districts and the county office of education. By imposing new duties in the annual allocation of ad valorem property tax revenues, this bill would impose a state-mandated local program. Existing law requires the Director of Finance to make certain adjustments n one of the formulas used in computing the stare's obligation under the California Constitution to peovide funding for school districts and community college districts so as to ensure that the modifications in property tax revenue allocation requirements that were made by a prior enactment do not have a net fiscal impact on school districts or community college districts, or upon the state's funding obligation to those districts. This bill would i:stead apply the adjustment requirement to modifications in property tax revenue allocation requirements that are made by "qualified provisions, and would define "qualified provisions" to include both the prior enacment currently specified by the adjustment requirement and a specified statute proposed to be added by thio bill. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursemene. This bill would provide that no reimbursement is required by this act foe a specified reason. Vote: majority. Appropriation: r.c. Fiscal committee: yes. State-mandated local program: yes. THE PEOPLE OF THE STATE OF CALIFORNIA DC ENACT AS FOLLOWS: SECTION 1. Section 41204.1 of the Education Code is amended to read: 41204.1. (a) (1) Pursuant to paragraph (2) of subdivision (b) of Section 41204, the Director o.*. Finance shall annually adjust "the percentage of General Fund revenues appropriated for school districts and community college districts, respectively, in the 1986-87 fiscal year" for purposes of applying paragraph (1) of subdivision (b) of Section 8 of Article XVI of the California Constitution, tc reflect those property tax revenue allocation modifications, required by the amendments made to Chapter 6 (commencing with Section 95) of Part 0.5 of Division 1 of the Revenue and Taxation Code by the aen adding :cis eeetieq qualifying provisions, as defined in paragrabh (2) , in a '.:miner that ensures that those modifications will have no net fiscal impact upon the amounts that are otherwise required to be applied by the state for tee support of school districts and community college districts pursuant to Section 8 of Article XV: of the California Constitution. 2) For purposes of this section, "gualifying provisions" means both of the following: ) The amendments made to Sections 97.2 and 97.3 of the Reeenue and Taxation Code y Chapter, 1111 of the Statutes of 1996. (B) Section 97.52 of the Revenue and Taxation Coda. U>) It is the intent of the Legislature fa eaaeting see aet adding PAGE 3 iisplay 1999-2000 Bill Text - INFORMATION SILL NUMBR: AB 24 BILL TEXT this seed.#ea to ensure both cf the following: (1) That the changes received by the aet adding this seetiea rnuali ging provisions in the allocations of ad valorem property tax revenues do not have a net fiscal impact upon school districts, as defined in accordance with Section 41302 .5, or community college districts. (2) That the changes required by the aet adding this seesten qualifying provisions in the allocations of ad valorem property tax revenues do not have a net fiscal impact upon the amounts of revenue otherwise required to be applied by the state for the support of school districts and community college districts pursuant to Section 8 of Article XVI of the California Constitution. read: SEC. 2. Section 97.52 is added to the Revenue and Taxation Code, tO 97 .g2 . (a) Notwithstanding any other provision of this chapter. for purposes of ad valoren property tax revenue allocations for the 1999-2000 fiscal year and each fiscal year thereafter, the auditor shall comply with all of the following requi_ements: (1) The auditor shall not allocate to the eo'nty'Sducatx ionaluRevue eateis A.:gmentation Fund a total amount of ad valorem property greater than the sum of the following amounts: (A: An amount of ad valorem property tax revenue that is equal to the amount of revenue the: was deposited in the county's Educational Revenue Augmentation Fund, and allocated from that fund to school districts and the county office of education, in the 1998-99 fiscal year. (B) The amount of ad valorem property tax revenue that is attributable in the relevant fiscal year to the amount of ad valorem property tax revenue that was deposited in the county's Educational Revenue Augmentation Fund, and was allocated from that fund to community college districts, in the prior fiscal year. :2) Any amount of revenue not allocated to the county's Educational Revenue Augmentation Fund as a result of the limitation established in subdivision (a) shall be allocated among the county, cities, and special districts, in accordance with each local agency's proportionate share of those revenues that would be required tc be allocated to the county' s Educational Revenue Augmentation Fund for the relevant fiscal year in the absence of paragraph el) . • (b) (1) For the 2000-01 fiscal year and each fiscal year thereafter, the total amount of ad valorem property tax revenue that, in of subdivision (a) , is zequired to be allocated to the county, a city, a special district, or the county's Educational Revenue Augmentation Fund shall be determined without regard to any increase or reduction that was made pursuant to eubdivision (a) in the prior fiscal year. t2) Any reduction in the amount of ad valorem property tax revenues deposited in the county's Educational Revenue Augmentation Fund resulting from the inplarentation of subdivision (a) shall be applied exclusively to reduce the amount of revenues allocated from that fund to school districts and county offices of education, and shall in no event be applied to reduce the amount of revenues allocated from that fund to community college districts. SEC. 3- No reimbursement is required by this act pursuant to Section 6 of Article XITIB of the California Constitution because thi8 act provides for PAGE 4 Disp:.ay 1999-2000 Bill Text - INFOP.MATION DILL NUMBER: AB 24 BILL TEXT offsetting savings to local agencies or school districts that res'.;lt in no net costs to the local agencies or school districts, within the meaning of Section 17E56 of the Government Code. Notwithstanding Section 17587 of the Government Code, unless otherwise specified, the provisions of th_s act shall become operative on the came date that the act takes effect pursuant to the California Constitution. PAGE 1 Display 1999-2000 Bill Text - ITFORMaTi0N BILL NUMBER: SB 165 BILL TEXT It ROI+U ED B'1 Senator Rainey ,7ANUARY 11, 1999 An act to amend Section 41204.1 of the Education Code, and to add Section 97.43 to the Revenue and Taxation Code, 'relating to local government finance, and declaring the urgency thereof, to take effect immediately. LEGISLATIVE COUNSEL'S DIGEST sB i65, as introduced, Rainey. Local government finance: property tax revenue allocation: local agency relief. Existing property tax law requires the county auditor, in each fiscal year, tc allocate property tax revenue to local jurisdictions in accordance with specified formulas and procedures, and generally requiresf that ehof jurisdiction be allocated an amount equalamountsubject to revenue allocated to that jurisdiction in the prior fiscal year, certain modifications, and that jurisdiction's portion of the annual tax increment, as defined. Existing property tax law also reduces the amounts of ad. valorem property tax revenue that would otherwise be annually allocated to the county, cities, and special districts pursuant to thessegenera Yllocation _egvirements by requiring, for purposes of determining property allocations in each county for the 1992-93 and 1993-94 fiscal years, thatthethe amounts of property tax revenue deemed allocated in the prior fiscal y the county, cities, and Special districts be reduced in accordance with certain formulas. It requires that the revenues not allocated to the county, cities, and special districts as a result of these reductions be transferred to the Educational Revenue Augmentation Fund in that county for allocation tc school districts, community college districts, and the county office of education. This bill would modify these reduction and transfer requirements, commencing with the 1999-2000 fiscal year, by requiring that each reduction and transfer amount calculated for a local agency in a county be annually reduced in accordance with an unspecified schedule, and that the revenues not allocated to the county's Educational Revenue Augmentation Fund as a result of these reductions be instead allocated among the local agencies in the county, as provided. By imposing new duties in the annual allocation of ad valorem. PAGE Display 1999-2:00 Bill Text - ISNFOR:MATION RILL NUMBER: SE 165 BILL TEXT ro revonues this bill would impose a state-mandated 1vca1 prccram. _ ex•ty tax p property •this bill would also state the intent of the Legislature, and would require the Director of :Finance to make certain adjustments, with respect to ensuring that the modifications required by this bill to property tax revenue allocations do not have a net fiscal impact on school districts or corn:unity college districts, or Lpon the state's obligation under the California funding t:on3ti•itution to provideundi g to those districts. The Califorria. Constitution requires the state to reimburse local agencies and scaool districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill wculd provide that no reimbursement is required by this act for a specified reason. This bill would declare that. -r is to take effect immediately as an urgency statute. Vote: 2/a. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes. TEE PEOPLE OF TEE STATE Q: CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. The Legislature hereby finds and declares that it is the intent cf the Legislature in enacting this act to do all of the following: (a) Limit the amounts of property tax revenues that are shifted from counties, cities, and special districts to Educational Revenue augmentation Funds to those amounts that were so shifted in the 1998-99 fiscal year. (b) Annually reduce the total amount of revenues tat are shifted to Educational Revenue Augmentation Funds, estimated to be three billion four hundred million dollars (S3,400,000,070 each year, by 10 percent per year until the total amount of revenues that are so shifted is reduced to z rc•.. (c) censure that those changes specified in this section are made only after all calculations are made with respect to those revenues that are to be allocated pursuant to Se_tion 4 of Article XVI of the California Constitution, in order to ensure that schools, from :he kindergarten level to the community college level, inclusive, are fully funded. SEC. 2. Secticn 41204.. of the Education Code is attended to read: 41204.5. (a) (1) Pursuant to paragraph (2) of subdivisio (b` of Section 41204, the Director of Finance shall annually adjust "the percentage of General Fund revenues appropriated for school districts and ceneutnity college districts, respectively, in the 158E-87 fiscal year" for purposes of applying paragraph (1) of subdivision (b: of Se^_tion 8 of article X_VI of the California Conatitar:or., to reflect those property tax revenue allocaticn modifications, PAGE 3 DLsplay 1999-20CC Bill Text - INFOPMATION PILL NUMBER! SB 165 BILL TEXT required by the amendments made to Chapter 6 (commencing with Section 95) of Part 0.5 of Division 1 of the Revenue and Taxation Code by the aet adding rhos seealeR qualifying provisions, as defined in paragraph i2) , in a manner that ensures that those modifications will have no net fiscal impact upon the amounts that are otherwise required to be applied by the state for the support of school districts and community college districts pursuant to Section 8 of Article XVI of the California Constitution. (2) For purposes of this section, "qualifying provisions" means both of the following: • (A) The amendments made to Sections 97.2 and 97.3 of the Revenue and Taxation Code ty Chaoter 1111 of the Statutes of 1996. (B) section 97.43 of the Revenue and Taxation Code. (b It is the intent of the Legislature in enacting the aet adding this seetien to ensure both of the following: (1) That the changes required by the act adding this section _salifying previsions in the allocations of ad valorem property tax revenues do not have a net fiscal impact upon school districts, as defined in accordance with Section 41302.5, or community college districts. (2) That the changes required by the act adding this seetien q..alifyina provisions in the allocations of ad valorem property tax revenues do not have a net fiscal impact upon the amounts of revenue otherwise required to be applied by the state for the support of school districts and community college districts pursuant to Section 8 of Article XVI of the California Constitution. SEC. 3. Section 97.43 is added co the Revenue and Taxation Code, co mead: 97.43. (a) (1) Notwithstanding any other provision of this article, for purposes of ad valorem property tax revenue allocations for the 1999-2000 fiscal year and in each fiscal year thereafter, the auditor shall allocate tc the county's Educational Revenue Augmentation Fund only that percentage specified in paxagzaph (2) of each amount cf ad valorem property tax revenue that is required to be allocated to that fund rather than a local agency as a result of the total reductions calculated for that local agency pursuant to Sections 97.2 and 97.3. (2) For purposes cf paragraph (1) , the allocation percentages are as follows: ?iscal Year Percentage (a) 199'-2000 and each fiscal year thereafter 0 (b) In the 1999--2000 fiscal year and each fiscal year thereafter, any amount of ad valorem property tax revenue that is not allocated to a county's Educational Revenue Augmentation Fund as a result of any limit or reduction established in subdivision (a) shall instead be allocated amcng the local agencies ...n the county in accordance with each local agency's proportionate share of the total amount of ad valorem property tax revenues that would be required to be allocated to the county' s Educational Revenue Augmentation Fund PAGE 4 Disulay 1999-2000 Bill Text - INFORMATION BILL MMBEF.: SB 165 BILL TEXT in the absence of this section. SEC. 4. No reimbursement is required by this act pursuant to Section 6 of Article XIII5 of the California Constitution because this act provides for offsetting savings to local agencies or school 5istricts that result in no net costs to the local agencies or school districts, within the meaning of Section 17556 of the Government Code. Notwithstanding Section 17580 of the Government Code, unless otherwise specified, the provisions of this act shall become operative on the same date that the act takes effect pursuant to the California Constitution. SEC. 5. This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are: In order to commence as soon as possible a program of fiscal relief that will allow local agencies to restore an adequate level of essential public services. it is necessary that this act take effect immediately.