HomeMy WebLinkAboutAGENDA REPORT 2003 0319 CC REG ITEM 10KMOORPARK CITY COUNCIL
AGENDA REPORT
TO: Honorable Mayor and City Council
From: Hugh R. Riley, Assistant City Manager
DATE: March 7, 2003(Meeting of 3/19/03)
SUBJECT: Consider Resolution Urging the State Legislature
to Reject the Governor's Proposal to Shift Local
Government's Share of VLF Revenue and To Honor
the 1998 Commitment to Restore the VLF.
DISCUSSION:
Governor Davis, in his budget deliberations with the
Legislature, continues to support the shifting of local
government's share of the Vehicle License Fee revenue which
is now being backfilled by the State's General Fund. The
fees were reduced by the legislature in 1998 -1999 during a
period when the State was experiencing a significant budget
surplus.
Legislation passed to reduce these fees included a
provision that, should the surplus situation change, a
restoration of the 1998 VLF would be triggered. The
governor's proposed budget ignores that commitment in the
original legislation.
The shift of the local government share of VLF revenue
would reduce revenue to the City of Moorpark by
approximately $ 1.4 million based on current revenue
projections. Staff has prepared a resolution opposing these
budgetary actions by the State.
STAFF RECOMMENDATION:
Adopt Resolution No. 2003 -
Attachment: Resolution No. 2003-
L
RESOLUTION NO. 2003-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF MOORPARK, CALIFORNIA, URGING THE
CALIFORNIA LEGISLATURE TO REJECT THE
GOVERNOR'S PROPOSED SHIFT OF LOCAL VLF
REVENUES AND TO HONOR THE 1998 COMMITMENT TO
RESTORE THE VLF
WHEREAS, prior to 1935, cities and counties collected
property taxes on motor vehicles to fund essential local public
health and safety services; and
WHEREAS, in 1935, the Legislature first enacted the Vehicle
License Fee (VLF) Act, replacing the property tax on vehicles
with a 1.75 percent fee charged against the value of the motor
vehicle; and
WHEREAS, in 1948, the rate of the VLF was increased to 2
percent of the value of the vehicle; and
WHEREAS, in 1986, the voters voted overwhelmingly to
constitutionally dedicate the proceeds of the VLF to fund city
and county services; and
WHEREAS, in 1998, a period of strong economic growth, the
Legislature approved the use of a portion of the rapidly growing
state General Fund to reduce the VLF payments of vehicle owners.
This amount, known as the "offset ", grew in future years to a
67.5 percent offset against the amount owed. The amount paid to
local governments in lieu of the reduced VLF payment is known as
the "VLF backfill "; and
WHEREAS, the 1998 legislation and subsequent enactments
contain clear provisions that when insufficient funds are
available to be transferred from the General Fund to fully fund
the offsets and backfill amount that the VLF offset shall be
reduced and VLF payments increased; and
WHEREAS, VLF
percent of typical
average, more than
more than half of
enforcement, fire,
programs.
and backfill revenues constitute 15 to 25
city and county general purpose revenues. On
60 percent of city general fund spending and
county general funds go to front line law
emergency medical services, and health care
WHEREAS, revenues derived from the VLF and backfill are of
critical importance in funding vital local public health and
safety services; and
WHEREAS, any failure by the Legislature to maintain the VLF
backfill or restore the VLF will cause widespread disruption in
local government services essential to the wellbeing of
California citizens and their cities and counties; and
WHEREAS, Governor Davis' proposal to divert $4 billion in
local VLF backfill payments over the next 17 months fails to
honor the 1998 commitment and is a direct assault on local
services that will be felt by every California resident; and
WHEREAS, shifting $4.2 billion in
revenues for local services is neither equ
state program or department has been asked
disproportionate share of the budget pain.
top of the nearly $5 billion each year that
local services to fund state obligations.
locally controlled
itable nor fair. No
to shoulder such a
These cuts come on
is transferred from
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF MOORPARK
DOES HEREBY RESOLVE AS FOLLOWS:
SECTION 1. That if the state General Fund can no longer
afford the expense of part or all of the VLF "backfill" that the
Legislature and Governor of California are hereby respectfully
urged to implement the provisions of current law providing for
the reduction of the VLF offset in bad economic times and to
restore the VLF in an amount necessary to reduce the VLF
backfill; and
SECTION 2. That the City of Moorpark hereby expresses its
profound appreciation to the legislators who support such VLF
restoration legislation.
SECTION 3. The City Clerk shall certify to the adoption of
this resolution and shall cause a certified resolution to be
filed in the book of original resolutions.
PASSED AND ADOPTED this day of ,
Patrick Hunter, Mayor
ATTEST:
Deborah S. Traffenstedt, City Clerk