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Home My WebLink AboutAGENDA REPORT 2004 0204 CC REG ITEM 09DTO: FROM: DATE: MOORPARK CITY COUNCIL AGENDA REPORT Honorable City Council ITEM q •"D • r .s Kim C. Chudoba, Senior Management Analyst K G January 26, 2004 (CC Meeting of 2/4/04) SUBJECT: Consider Resolution Supporting a Statewide Ballot Initiative to Require Voter Approval Before State Government May Take Local Tax Funds BACKGROUND In October 2003, the League of California Cities General Assembly voted to sponsor a statewide initiative to protect local tax dollars from diversion by state government to balance the state budget. As a result, the League, the California State Association of Counties, and the California Special Districts Association have submitted the "Local Taxpayers and Public Safety Protection Act" to the Attorney General for title and summary. In February 2004, proponents will circulate petitions to qualify the measure for the November 2004 ballot. DISCUSSION The "Local Taxpayers and Public Safety Protection Act" would require a majority vote of the electorate before state government reduces, suspends, or delays the receipt of any local government's share of property tax, sales tax, and vehicle license fee funds. (However, this measure would allow the legislature to reduce vehicle license fee funds without voter approval if state lawmakers reimburse local governments for lost revenues.) In addition, this initiative would clarify the state's duty to reimburse local governments for state mandated programs in a timely manner to protect local governments from hidden cost shifts. This measure would also allow local governments to opt out of certain mandates (except workplace safety and employment procedural rights) if the legislature does not provide full reimbursement. 000043 Honorable City Council February 4, 2004 Regular Meeting Page 2 David Mullinax, Regional Representative, League of California Cities, will provide an overview of the "Local Taxpayers and Public Safety Protection Act" at the City Council meeting. Additionally, the Budget and Finance Committee will discuss this initiative on February 4, 2004 and present its recommendation at the City Council meeting. STAFF RECODMENDATION Direct staff as deemed appropriate. Attachment 1: Local Taxpayers and Public Safety Protection Act Overview Attachment 2: Resolution No. 2004- 000044 ATTACHMENT LEAGUE 1400 K Street, Suite 400 • Sacramento, California 95814 OF CALIFORNIA Phone: 916.658.8200 Fax: 916.658.8240 !1 T T T r C www.cacities.org LOCAL TAXPAYERS AND PUBLIC SAFETY PROTECTION ACT -AN OVERVIEW November 2004 Election State -Local Fiscal System Broken. There is widespread agreement that the state -local fiscal relationship is broken. One of the reasons is because state leaders no longer respect the difference between state and local tax revenues. In recent years, the state legislature and govemor have approved laws that divert, use or delay the payment of local tax revenues to local governments that finance public safety, public health, park, library, street maintenance and other vital community services. This has caused pressure for higher local fees that can increase the cost of housing. Local Funds Drained for Higher State Spending. Since 1991 more than $30 billion of local property taxes have been drained from cities, counties and special districts —costing cities alone 800 million in FY 2003 -04 and $6.9 billion the last 12 years. Even in years of state budget surpluses, the state has used these funds to finance its constitutional funding obligation to public education, allowing it to increase state general fund spending for other state programs. This has come at the expense of vital local public safety and other services. State Shifts Costs to Local Governments. In recent years the state also has shifted costs for state - sponsored programs and delayed constitutionally required reimbursements to local governments for state mandated programs and services. In the last two fiscal years, the state has "deferred" over $1 billion in constitutionally required reimbursements to local governments for mandated services and programs. This cost burden is then paid with local taxes that should be used for important local services Constitutional Protection Needed Now. The League has joined forces with the California State Association of Counties (CSAC) and the California Special Districts Association (CSDA) to sponsor a ballot initiative in November 2004, entitled the Local Taxpayers and Public Safety Protection Act, to put the voters in charge of whether local tax dollars should be used to fund state services. It will not raise taxes. It will not repeal laws the state has already passed. It will not require the return of property taxes already taken nor affect funding of schools. It will not prevent structural reform of the fiscal system -- simply require that structural changes be planned collaboratively by state and local leaders and approved by the voters. The initiative will do two simple things: Public Vote Required. Require approval by a majority of the electorate before a proposed state law may take effect that reduces the sales, property and VLF funds of cities, counties and special districts. Flexibility is provided to reduce the VLF and replace it with substitute revenues (i.e., a "backfill ") without voter approval; and Reimburse for Mandated Costs. Clarify the state's duty to reimburse in a timely way for a new mandated program or higher level of service, protecting local governments from hidden cost shifts. Allows local governments to opt -out of certain non - workplace safety and employee procedural rights mandates if the state fails to pay in a timely way. For More Information. Contact Chris McKenzie, Executive Director (916- 658 - 8275); Mike Madrid, Public Affairs Director (916- 658 - 8272); or Dwight Stenbakken, Deputy Executive Director (916- 658 - 8213). How to Make A Contribution. The League has established a political action committee (CITIPAC - -ID # 1254399) for contributions to this initiative. For more information, contact 916- 658 -8273, email info(a citipac.orq or go to www.citipac.orq Revised October 30, 2003 C I T I P A C www.citipac.org 000045 ATTACHMENT 2 RESOLUTION NO. 2004- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MOORPARK, CALIFORNIA, SUPPORTING A STATEWIDE BALLOT INITIATIVE TO REQUIRE VOTER APPROVAL BEFORE STATE GOVERNMENT MAY TAKE LOCAL TAX FUNDS WHEREAS, state government annually seizes over $800 million in city property tax funds statewide, costing cities over $6.9 billion in lost revenues over the past 12 years and seriously reducing resources available for local public safety and other services; and WHEREAS, in adopting the state budget this fiscal year, the Legislature and Governor appropriated local vehicle license fee backfill and redevelopment property tax funds that are needed to finance critical city services such as public safety, parks, street maintenance, housing, and economic development; and WHEREAS, the deficit financing plan in the state budget depends on a local property and sales tax swap that leaves city services vulnerable if the state's economic condition fails to improve; and WHEREAS, the adopted state budget assumes an ongoing structural budget deficit of at least $8 billion, putting city resources and services at risk in future years to additional state revenue raids; and WHEREAS, it is abundantly clear that state leaders will continue to use local tax funds to balance the state budget unless the voters limit the power of the Legislature and Governor to do so; and WHEREAS, the voters of California are the best judges of whether local tax funds should be diverted, confiscated, shifted or otherwise taken to finance an ever - expanding state government; and WHEREAS, on September 10, 2003, the General Assembly of Voting Delegates of the League of California Cities voted to sponsor a statewide ballot initiative to empower the voters to limit the ability of state government to confiscate local tax revenues to fund state government; and 0€ 004G Resolution No. 2004 - Page 2 WHEREAS, the League of California Cities has asked cities to support a November 2004 ballot initiative that will allow voters to decide whether state government may appropriate local tax revenues to fund state government operations and responsibilities. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF MOORPARK DOES HEREBY RESOLVE AS FOLLOWS: SECTION 1. The City of Moorpark hereby expresses its strong support for a statewide ballot initiative to allow voters to decide whether local tax funds may be taken, confiscated, shifted, diverted, or otherwise used to fund state government operations and responsibilities. SECTION 2. The City Council and staff are authorized to provide impartial informational materials on the initiative as may be lawfully provided by the City's representatives. No public funds shall be used to campaign for or against the initiative. 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 4th day of February, 2004. Patrick Hunter, Mayor ATTEST: Deborah S. Traffenstedt, City Clerk 000047