HomeMy WebLinkAboutAGENDA REPORT 2010 0901 CC REG ITEM 10NMOORPARK CITY COUNCIL
AGENDA REPORT
TO: Honorable City Council
FROM: John Brand, Senior Management Analyst
DATE: August 18, 2010 (CC Meeting of 910112010)
ITEM 10.N.
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City Council Meeting
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ACTION:
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SUBJECT: Consider Resolution Supporting Proposition 22- the Local Taxpayer,
Public Safety and Transportation Protection Act of 2010
SUMMARY
The Council is being asked to approve a resolution supporting Proposition 22, the Local
Taxpayer, Public Safety and Transportation Protection Act of 2010, a proposed
constitutional amendment that will be presented for voter approval on the November
2010 statewide ballot.
BACKGROUND
On December 12, 2009 Council adopted Resolution 2009 -2881, supporting the efforts
of the League of California Cities (LOCC) and it partners who formed a coalition to
qualify the Local Taxpayer, Public Safety and Transportation Protection Act of 2010 for
the November ballot. Councilmembers and staff volunteered hours of their personal
time to gather voter signatures to qualify the measure for the ballot. This grassroots
effort was successful. On July 7, Council directed staff to bring for Council
consideration a staff report on Proposition 22.
DISCUSSION
As Council is aware, the state legislature is increasingly relying on taking local
government revenue to reduce its budget imbalances year after year. The loss of
revenue is impairing the ability of many local agencies to deliver their basic services.
Major cutbacks in all areas and the elimination of public services are becoming
commonplace across the state. Many agencies, including the City of Moorpark, have
had to spend reserve funds to maintain essential services.
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Honorable City Council
Meeting of September 1, 2010
Page 2
Prop. 22, the Local Taxpayer, Public Safety and Transportation Protection Act, will be
on the November 2010 statewide ballot and is co-sponsored by the League, the Alliance
for Jobs and the California Transit Association. Already, more than 500 groups and local
governments including public safety, business, labor, taxpayer, environmental groups
and many others have joined the coalition to support Prop. 22.
Among other provisions, the measure would stop the state from taking, borrowing or
diverting local government revenues, including:
• Revoking the state's ability to borrow local government property tax funds.
• Preventing the state from redirecting or diverting locally levied taxes, including
parcel taxes, sales taxes, utility user taxes, transit occupancy taxes and other
locally imposed taxes that are currently passed by local governments and /or
their voters and dedicated to cities, counties and special districts.
• Preventing the state from redirecting or diverting redevelopment tax
increment funds.
• Prop. 22 also protects gas tax funds which should be used at the local level
for road repair, congestion relief, and public transit services like buses and
commuter rail.
On August 2, the League of California Cities filed a lawsuit against the summary of
Proposition 22 created by the Legislative Analyst's Office (LAO), arguing that the text
does not accurately represent the proposition's impact on local government finances.
Of the 58 words in the ballot summary, 51 words detail the impacts to the state, while
only seven words contain a reference to local government revenues. The phrase "local
government" is completely excluded, an omission the League said "leaves the
impression that Prop. 22 has no fiscal impact on local government." To completely
exclude or ignore the impact of Prop. 22 on local government in the fiscal summary is a
disservice to voters and a failure of the LAO's obligation under the law, according to the
League.
On Aug. 6, Sacramento Superior Court Judge Michael Kenny's ruling ordered changes
to the Proposition 22 fiscal impact summary appearing in the official Title & Summary
and Ballot Label. Judge Kenny agreed with the underlying argument made by the
League, saying that the fiscal impact statement was "misleading and inconsistent with
the requirements of the Election Code" and that "the condensed Fiscal Impact portion of
the Ballot Label should contain some express reference to 'local' governments." Judge
Kenny ordered the second bullet of the Fiscal Impact statement be changed to read:
• Comparable increases in funding for state and local transportation
programs and local redevelopment.
The Legislative Analyst declined to appeal the ruling of Judge Kenny.
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Honorable City Council
Meeting of September 1, 2010
Page 2
Support for Prop. 22 could be justified based on Legislative Platform statement I.K.
1. Local Government Finance
K. Support the establishment of a constitutionally - protected funding structure
for local government.
Support for Proposition 22 comes from many cities and counties, the League of
California Cities, California Fire Chiefs Association, California Police Chiefs Association,
California Transit Association, the California Alliance for Jobs, the California
Redevelopment Association, the California Special Districts Association, and the
editorial board of local and regional newspapers.
Opponents of Proposition 22 include the California Teachers Association, Health
Access California, the California Professional Firefighters, and the editorial board of the
San Diego Union Tribune, which editorialized against the measure, saying that it will
perpetuate the ballot -box budgeting that they believe plays a role in California's budget
travails. Other opponents state that Proposition 22 would "create a wall that will prevent
borrowing in times of economic crisis and would place an even greater burden of cuts
on public education and the backs of our students ", according to a spokesperson for the
California Teachers Association. "By protecting one part of the budget, Proposition 22
puts health, education and other core services at greater risk," according the California
Progress Report.
As indicated above, On December 12, 2009 the City adopted Resolution 2009 -2881
supporting placing the Local Taxpayer, Public Safety and Transportation Protection Act
on the ballot.
FISCAL IMPACT
None associated with adopting the resolution. Critically significant fiscal impacts may
be possible if the state continues to take revenue from local government.
STAFF RECOMMENDATION
1. Adopt Resolution No. 2010-
2. Direct City Clerk's staff to forward copies of this resolution to the League of
California Cities and the campaign offices.
Attachments
Attachment 1: A one -page overview of the measure.
Attachment 2: Commonly asked questions and answers about the measure
Attachment 3: Resolution No. 2010-
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Califomians to
PROTECT
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www.savelocalservices.com
Attachment 1
YES to Protect Local Taxpayers and Funding
for Public Safety, Transportation & Other Vital
Local Services from State Raids
THE PROBLEM: STATE RAIDS AND BORROWING ARE JEOPARDIZING PUBLIC SAFETY,
EMERGENCY RESPONSE, TRANSPORTATION, TRANSIT AND OTHER VITAL LOCAL SERVICES.
California voters have overwhelmingly passed separate ballot measures to dedicate local funding sources to essential
local services and to prevent the State from shifting or raiding local government, transit and transportation funds.
Despite this, the State recently passed a budget that borrows and takes approximately $5 billion in city, county, transit,
redevelopment and special district funds this year. This year's raids and previous, ongoing state raids and borrowing are
jeopardizing the services Californians need most:
• Police, fire and emergency 911 services have been cut.
• Healthcare services for children, seniors and the disabled are being slashed.
• Road repair and maintenance, congestion relief and safety improvements are constantly at risk.
• Public transit like buses, commuter rail and shuttles are being slashed and fares are being raised.
• Parks and libraries are closing, and other local government services critical to protect our
neighborhoods and improve our quality of life are shutting down.
• Vital community economic development and job creation projects are being shut down.
State raids of local funds are fiscally irresponsible. The fiscally irresponsible practice of borrowing local taxpayer and
transportation funds makes our budget problems worse down the line because local government and transportation
funds have to be repaid, with interest. Additionally, many of the outright raids are ultimately rejected by the courts,
creating even larger state budget deficits down the line.
THE SOLUTION: PROHIBIT THE STATE FROM RAIDING LOCAL GOVERNMENT, TRANSIT AND
TRANSPORTATION FUNDS.
The Local Taxpayer, Public Safety and Transportation Protection Act, scheduled for the November 2010 statewide ballot, would:
✓ Prohibit the State from taking, borrowing or redirecting local taxpayer funds dedicated to public safety,
emergency response and other vital local government services. The measure would close loopholes to prevent
the taking of local taxpayer funds currently dedicated to cities, counties, special districts and redevelopment
agencies. It would also revoke the State's authority to borrow local government property tax funds.
✓ Protect vital, dedicated transportation and public transit funds from state raids. The measure would prevent
State borrowing, taking or redirecting of the state sales tax on gasoline (Prop 42 funds) and Highway User Tax on
gasoline (HUTA) funds that are dedicated to transportation maintenance and improvements. It would also prevent
the State from redirecting or taking public transit funds.
✓ Protect local taxpayers by keeping more of our local tax dollars local where there's more accountability to voters,
and by ensuring once and for all that our gas taxes go to fund road improvements. The measure also reduces
pressure for local tax and fee increases that become necessary when the State redirects local funds.
✓ Reform state government and enhance fiscal accountability. This measure is a key step in reforming California's
broken budget system by restoring more local control and accountability. It also stops the irresponsible practice of
the State borrowing special funds that have to be repaid with interest, which only puts our State further in debt.
Paid for by Californians to Protect Local Taxpayers and Vital Services, a coalition of taxpayers, public safety, local government,
transportation, business and labor. 1121 L Street, #803 — Sacramento, CA 95814
260
Califomians to
PROTECT
LOCAL
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www.savelocalservices.com
Attachment 2
Questions & Answers About the
Local Taxpayer, Public Safety and
Transportation Protection Act
WHAT IS YOUR MEASURE AND WHAT DOES IT PROPOSE TO DO?
The Local Taxpayer, Public Safety and Transportation Protection Act is a constitutional amendment that we are
working to place on California's November 2010 statewide ballot. The initiative would stop the State from raiding or
borrowing funding for local public safety, transportation, transit and other essential local government services.
Specifically, the measure would:
✓ Prohibit the State from taking, borrowing or redirecting local taxpayer funds dedicated to public safety,
emergency response and other vital local government services. The measure would close loopholes to
prevent the taking of funds currently dedicated to cities, counties, special districts and redevelopment agencies.
It would also end the State's fiscally irresponsible practice of borrowing local government property tax funds.
✓ Protect vital, dedicated transportation and public transit funds from State raids. The measure would
prevent State borrowing, taking or redirecting of the state sales tax on gasoline (Prop 42 funds) and Highway
User Tax on gasoline (HUTA) funds that voters have dedicated to transportation maintenance and
improvements. It would also prevent the State from redirecting or taking public transit funds.
✓ Protect local taxpayers by keeping more of our local tax dollars local where there's more accountability to
voters, and by ensuring once and for all that our gas taxes go to fund road improvements. The measure also
reduces pressure for local tax and fee increases that become necessary when the State redirects local funds.
WHY IS IT NEEDED?
Unfortunately, the State has continued its irresponsible practice of taking and borrowing local taxpayer dollars and
dedicated transportation funds. The 2009110 state budget borrows and takes approximately $5 billion in city,
county, transit, redevelopment and special district funds this year despite the fact that voters have overwhelmingly
passed ballot measures to keep local funding at the local level to provide essential local services. This year's raids
and previous, ongoing state raids and borrowing jeopardize the services Californians need most, including police,
fire and emergency 911 services; local economic development and redevelopment; mass transit like buses and
commuter rail; and transportation improvements like road repairs and congestion relief. We need to pass this
measure to protect these vital local services from State raids and borrowing.
ISN'T FUNDING FOR LOCAL GOVERNMENT AND TRANSPORTATION ALREADY PROTECTED FROM
STATE RAIDS?
California voters have overwhelmingly passed separate measures to prevent the State from raiding local
government and transportation funds. However, each and every year the State attempts to take or borrow local
government, transportation and transit funding using loopholes, or illegal funding diversions that have only been
stopped after expensive and lengthy court battles. This year alone, the Legislature:
Borrowed approximately $2 billion in property taxes from local governments, despite no clear path to repay
these funds.
Paid for by Californians to Protect Local Taxpayers and Vital Services, a coalition of taxpayers, public safety, local
government, transportation, business and labor. 1121 L Street, #803 - Sacramento, CA 95814
261
• Took $2.05 billion in local redevelopment funds, despite a recent Superior Court ruling that says these
types of raids are unconstitutional.
• Shifted $910 million in transit funding away from local transit agencies. The courts have since ruled these
types of raids are unconstitutional.
• Voted to take more than $1 billion of the local government share of the Highway User Tax (HUTA) to repay
state bond debt (but the measure stalled in Assembly). These are funds that have always been used to
finance local road repairs and maintenance.
• Took action to eliminate the state sales tax on gasoline (Prop 42 funds) and HUTA and replace with a
gasoline 'fee' that would have no constitutional protection from future raids by the legislature (the Governor
ultimately vetoed this measure).
• Threatened to borrow Prop 42 transportation funds to address the State's deficit.
Our measure would close loopholes in current law that the legislature has exploited to take or divert local funds.
And it would tighten sections of the law to prevent illegal State funding raids of local government and transportation
funds before they happen.
WHY DOES YOUR MEASURE PREVENT THE STATE FROM BORROWING LOCAL GOVERNMENT AND
TRANSPORTATION FUNDS?
The local government revenue protection measure in 2004 (Prop 1A) and the transportation revenue protection
measure in 2006 (Prop 1A) included provisions that allow the State to borrow these funds during fiscal
emergencies. However, after several budget cycles it is clear that these borrowing provisions are not only bad for
local governments and transportation services, but fiscally irresponsible for the State. Borrowing these dedicated
funds only plunges our state deeper into debt because the funds must to be repaid, with interest within three years.
The borrowing was meant to provide an outlet in short-term budget emergencies, but it's instead being used to
paper over structural budget problems. For example, the State has no clear way to pay back the $2 billion plus
interest in local property taxes that the State is borrowing as part of this year's 2009 -2010 State budget, yet
lawmakers borrowed these funds anyway.
What's more, because the State has the authority to borrow local government and transportation funds, it creates
mass uncertainty for cities and counties who need to plan and pass their local budgets, and for transportation and
transit planners who aren't sure if they can rely on these revenues in any given year.
DOES THIS MEASURE INCREASE OR DECREASE REVENUES FOR LOCAL GOVERNMENTS OR FOR
TRANSPORTATION AND TRANSIT?
This measure does not increase or decrease the existing revenues that are dedicated to local government,
transportation and transit funds. It simply prevents the State from borrowing or raiding existing local government,
transportation and transit revenues that voters have dedicated to these services.
WON'T THIS MAKE OUR STATE'S BUDGET SYSTEM EVEN WORSE BY FURTHER PUTTING A LOCK BOX
ON BILLIONS OF DOLLARS IN FUNDING?
First, these are revenues that have historically been dedicated to cities, counties and special districts to fund local
government services. It's fiscally irresponsible for State Government to raid funds from local governments.
Second, it's important to remember that these are funds that voters have ALREADY dedicated to local government,
transportation and transit services. We are not dedicating any NEW funding for these services, but instead ensuring
Paid for by Californians to Protect Local Taxpayers and Vital Services, a coalition of taxpayers, public safety, local
government, transportation, business and labor. 1121 L Street, #803 — Sacramento, CA 95814
262
that the will of voters is upheld by protecting local government and transportation funds from further State raids and
borrowing.
This reform is fiscally responsible and a key step in long -term reform for California. The State has gotten itself into
this deep fiscal mess in large part because lawmakers have relied on budget gimmicks like tapping into voter -
protected funds and borrowing which only pushes our problems into the future.
HOW DOES THIS MEASURE FIT INTO THE NEED FOR BROAD REFORM OF STATE GOVERNMENT IN
CALIFORNIA?
This measure is a necessary and responsible first step toward fiscal reform in California. Virtually everyone agrees
that State reforms must include the restoration of more local control over local tax dollars, and moving services
closer to the people at the local level. This measure ensures local control, predictability, and accountability for local
tax dollars that are used to provide the most essential local services.
WILL THIS MEASURE IMPACT FUNDING FOR PUBLIC SCHOOLS, HEALTHCARE OR OTHER SERVICES?
No. This measure does not take away funding from schools or any other service funded by the State because it
only protects EXISTING funds that are already dedicated to local services like public safety and transportation. And
this measure in no-way alters Proposition 98, which guarantees funding levels for K -14 schools.
HOW WILL THIS MEASURE IMPACT TAXPAYERS?
This measure provides further protections for existing revenues that voters have already dedicated to local
government, transportation and transit services. It does not increase taxes. In fact, this measure protects taxpayers
by keeping more of our tax dollars local where they're more accountable. And this measure decreases pressure for
local tax and fee increases at the local government level that become needed when the state takes local revenues
and local governments are forced to look for new revenues to protect vital services.
Paid for by Californians to Protect Local Taxpayers and Vital Services, a coalition of taxpayers, public safety, local
government, transportation, business and labor. 1121 L Street, #803 — Sacramento, CA 95814
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Attachment 3
RESOLUTION NO. 2010-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
MOORPARK, CALIFORNIA, SUPPORTING PROPOSITION
22: THE LOCAL TAXPAYER, PUBLIC SAFETY AND
TRANSPORTATION PROTECTION ACT OF 2010 ON THE
NOVEMBER 2010 BALLOT
WHEREAS, California voters have repeatedly and overwhelmingly passed
separate ballot measures to stop State raids of local government funds, and to
dedicate the taxes on gasoline to fund local and state transportation improvement
projects; and
WHEREAS, these local government funds are critical to provide the police and
fire, emergency response, parks, libraries, and other vital local services that residents
rely upon every day, and gas tax funds are vital to maintain and improve local streets
and roads, to make road safety improvements, relieve traffic congestion, and provide
mass transit; and
WHEREAS, despite the fact that voters have repeatedly passed measures to
prevent the State from taking these revenues dedicated to funding local government
services and transportation improvement projects, the State Legislature has seized
and borrowed billions of dollars in local government and transportation funds in the
past few years; and
WHEREAS, this year's borrowing and raids of local government, redevelopment
and transit funds, as well as previous, ongoing raids of local government and
transportation funds have lead to severe consequences, such as layoffs of police, fire
and paramedic first responders, fire station closures, stalled economic development,
healthcare cutbacks, delays in road safety improvements, public transit fare increases
and cutbacks in public transit services; and
WHEREAS, State politicians in Sacramento have continued to ignore the will of
the voters, and current law provides no penalties when state politicians take or borrow
these locally- dedicated funds; and
WHEREAS, a coalition of local government, transportation and transit
advocates recently filed a constitutional amendment with the California Attorney
General, called the Local Taxpayer, Public Safety, and Transportation Protection Act
of 2010, for potential placement on California's November 2010 statewide ballot; and
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Resolution No. 2010 -
Page 2
WHEREAS, approval of this ballot initiative would close loopholes and change
the constitution to further prevent State politicians in Sacramento from seizing,
diverting, shifting, borrowing, transferring, suspending or otherwise taking or interfering
with tax revenues dedicated to funding local government services, including
redevelopment, or dedicated to transportation improvement projects and mass transit.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF MOORPARK
DOES HEREBY RESOLVE AS FOLLOWS:
SECTION 1. The City hereby formally endorses Proposition 22: The Local
Taxpayer, Public Safety and Transportation Protection Act of 2010, a proposed
constitutional amendment which will be presented for voter approval on the November
2010 statewide ballot.
SECTION 2. The City Council authorizes the listing of the city of Moorpark in
support of the Local Taxpayer, Public Safety and Transportation Protection Act of
2010.
SECTION 3. The City Clerk is directed to forward a copy of this resolution to
the Executive Director of the League of California Cities.
SECTION 4. The City Clerk is further directed to fax a copy of this resolution to
the campaign offices at 916.442.3510.
SECTION 5. The City Clerk shall certify to the adoption of the resolution and
shall cause a certified resolution to be filed in the book of original resolutions
PASSED AND ADOPTED this 1St day of September, 2010.
Janice S. Parvin, Mayor
ATTEST:
Maureen Benson, Assistant City Clerk
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