HomeMy WebLinkAbout11/04/2003, C6 - RESOLUTION SUPPORTING A STATEWIDE BALLOT INITIATIVE TO REQUIRE VOTER APPROVAL BEFORE STATE GOVERNME council
j acEnaa Repont 1�N.°�
C I T Y O F SAN LU I S O B I S P O
FROM: Jonathan P. Lowell, City Attorney d'�'
Prepared By: Betsy Kiser,Principal Administrative Analyst
SUBJECT: RESOLUTION SUPPORTING A STATEWIDE BALLOT INITIATIVE
TO REQUIRE VOTER APPROVAL BEFORE STATE GOVERNMENT
MAY TAKE LOCAL TAXES
CAO RECOMMENDATIONS:
1. Adopt a resolution supporting a November 2004 statewide ballot initiative that would
require voter approval before California State government seizes local tax funds for
statewide use; and
2. Designate the Mayor to be the City's liaison to the League of California Cities with
regard to this initiative effort.
DISCUSSION
Background
Historically, the State has frequently addressed its budget shortfalls by utilizing local government
revenues. For example, when the State experienced a budget crisis in the early 1990's, it began
shifting property tax revenue from local governments to the State in order to meet its financial
obligations for education. The Education Revenue Augmentation Fund (ERAF) continues to
shift over$4 billion annually from local governments. Since 1991, the City of San Luis Obispo
has lost over$12 million as a result of ERAF shifts.
To compound the ERAF take-aways, this fiscal year the State also implemented a one-time
suspension of VLF backfill (prior to implementation of the new increased VLF tax). This has
resulted in a revenue loss to the City of San Luis Obispo of nearly $523;000, which may or may
not be returned in 2006 as promised. Additionally, Governor-Elect Schwarzenegger has vowed
to do away with the VLF altogether and, at this time, his intentions to compensate local
government for this loss remain unclear. If left unfunded, this translates into a potential annual
revenue loss of$1.8 million for the City of San Luis Obispo.
Although the City has developed a long-range financial plan and implemented a number of
actions to ensure local financial stability, these efforts are severely restricted by the fact that local
revenues are continuously subject to State interference. While economic fluctuations can be
addressed, effective financial planning cannot be achieved until there is some level of control
over available revenue sources.
Council Agenda Report—Statewide Ballot Initiative November 2003
Page 2
Ballot Initiative
At the League of California Cities 2003 Annual Conference, the General Assembly of Voting
Delegates unanimously voted to sponsor a statewide ballot initiative to limit the State's ability to
transfer local government revenues without a vote of the public. As a result, the League has now
requested individual cities to support the initiative to be placed on the November 2004 ballot.'
Essentially the initiative will:
1. Require approval by a majority of the electorate before a proposed State law may take
effect that appropriates, reallocates, redistributes, reduces or suspends the payment of
local tax revenues(sales,property and VLF)to cities,counties and special districts; and
2. Clarify that the State must reimburse local governments for a new mandated program or
higher level of service,protecting local governments from cost shifts.
The need for the proposed ballot initiative has become imperative in order to ensure the City can
deliver necessary services to the community.
Liaison to the League with Regard to Initiative
In addition to the resolution supporting the initiative, the League of California Cities has
requested that the City Council designate one representative to work directly with the League and
CITIPAC on activities related to the ballot initiative. Information regarding what activities
public officials can and cannot participate in relative to fundraising and the campaign has been
provided by CITIPAC and is attached. The CAO is recommending that the Mayor be the
designated liaison.
CONCURRENCES
Locally, thus far, the Cities of Arroyo Grande and Santa Maria have both adopted resolutions and
designated a Council liaison in support of the initiative. Other cities will be taking action in the
coming weeks.
FISCAL IMPACT
There is no immediate cost impact caused by the resolution in support of the initiative.
However, if the voters approve the ballot initiative, it could substantially reduction lessen future
potential revenue losses.
The development and promotion of the ballot initiative is being coordinated by CITIPAC, an
organization associated with the League of California Cities but privately financed so it can legally
engage in political activities. (Attachment 1 provides information on CITIPAC.)
GAStaff\Ciser\Legislation\CAR League Statewide Initiative 101703.doc
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Council Agenda Report—Statewide Ballot Initiative November 2003
Page 3
ALTERNATIVES
The following alternatives are provided for the City Council's consideration:
1. Reconsider the resolution after the specific language of the ballot initiative is provided,
which should be late October or early November, 2003;
2. Do not approve the attached resolution;
3. Provide direction to staff.
ATTACHMENTS
1. Information on CITIPAC
2. Ballot Measure Campaign—Rules for City Officials brochure
3. Resolution
G`.\StafAKiser\L.egislation\CAR League Statewide Initiative 101703.do`c^
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www.CrrIPAC.org About CT'''TPAC Page 1 of 1
OWN 1
����lsgnt OOs d�UNR a PRINT
, AboutCITIPAc�I� J rorMomaau mu Pose
What is CITIPAC? CITIPAC is the League of California Cities' political action committee.Itwas established
by the League board of directors in 2003 to raise private funds that the League could use to advocate for cities through
ballot measure activities.
Why does the League need CITIPAC? The mission of the Lea ue is "to restore and
protect local control for cities". Since the most important public policy decisions affecting the o#uture of cities are being
decided today in statewide elections, the League needs the financial capacity to advocate for cities when ballot measures
are being considered. Moreover, achieving the League's No. 1 goal of protecting local revenue will ultimately require a
constitutional amendment, which can only be achieved through a statewide ballot measure. The League board of directors
has directed the League staff to work to place a ballot measure on the November 2004 statewide ballot.
Finally, an effective statewide organization needs three capabilities today in California political life. They are: a strong
Lobbying program, grassroots legislative support, and a fund-raising capacity that allows an organization to sponsor or
support statewide ballot measures. An aggressive fund-raising strategy demonstrates that the League has that capability,
and wins "a place at the table"in the State Capitol.
�iow Ids CITIPAC Related to Other League Fundraising
Ctl V 1 I es. The League established another political action committee in 2002 called Save Our Services (SOS)to
facilitate contributions by 0EY officials and employees through payroll deductions to League efforts to protect city
revenues. The SOS Fund will continue to be governed separately and is restricted solely to protecting city revenues.
CITIPAC contributions will come from a wider audience.and not through payroll deductions. CITIPAC will be governed by the
League board of directors. CITIPAC funds will be used for a broader array of purposes that help accomplish the League's
mission. Examples could include measures such as 2002's Proposition 42 regarding transportation funding.
How Will CITIPAC Raise Funds?TheLeajue will set statewide and regional fundraisinjgoals.
League regional staff will work with city officials, and possibly regiona fund-raisers, to chair events and help recrui
participants. There are myriad events and venues that can be tailored to each region to meet the fundraising goals:golf
tournaments, receptions, dinners and others. In some areas the preferred approach may not involve an event, but simply
the involvement of city officials who, working on their own time and with their own resources, achieve their fundraising
goals through personal contacts.
What is Needed From City Officials? Local officials can play a number of rotes, from
chairing events, to serving as co-chairs or event Committee members. Each will be asked to-help develop lists of potential
contributors, and to help contact individuals, businesses and organizations to encourage their participation. Officials will
also provide ongoing support to build the financial capacity the League's PAC must have to be a viable force at the ballot
box and with the Legislature.
4
http://www.citipac.org/documents/main.htm 10/22/03
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ATTACHMEW3
RESOLUTION NO. (2003 Series)
A RESOLUTION OF THE COUNCIL OF THE CITY OF SAN LUIS OBISPO 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
(ERAF) 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 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, the City of San Luis Obispo has implemented a number of actions to ensure local
financial stability and these efforts are severely restricted by the fact that local revenues are continuously
subject to State interference; and
WHEREAS, it is clear that state leaders will likely 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, the General Assembly of Voting Delegates of the League of California Cities at its
September 10, 2003 meeting voted to sponsor a statewide ballot initiative to empower the voters to limit
the ability of state government to confiscate local tax funds to fund state government; and
WHEREAS, the League has requested that cities offer support for a November 2004 ballot
initiative that will allow voters to decide whether state government may appropriate local tax funds to
fund state government operations and responsibilities.
NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo that
the City 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; and
RESOLVED FURTHER, that 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; and
RESOLVED FURTHER,that the residents of the City are encouraged to become well informed
on the initiative and its possible impacts on the critical local services on which they rely; and
R
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ATTACHMENT 3
Resolution No. (2003 Series)
Page 2
RESOLVED FURTHER,that the City Administrative Officer is hereby directed to send:a copy
of this initiative to the Executive Director of the League of California Cities.
Upon motion of , seconded by ,
and on the following roll call vote:
AYES:
NOES:
ABSENT:
The foregoing resolution was adopted this day of , 2003.
David F. Romero, Mayor
ATTEST:
Lee Price,C.M.C.
City Clerk
APPROVED AS TO FORM:
Jona P. Lowell, City Attorney
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council mcmoRanbum
[city of san Luis oims o. a0mmistuation Oe autment
DATE: October 31, 2003
RECEIVED
TO: City CouncilOCT 3 1 2003
FROM: Ken Hampian, CA . SLO CITY CLERK
SUBJECT: Statewide Initiative Filed; Ballot Language Available
We just received from the League of California Cities notification that the "Local Taxpayers and
Public Safety Protection Act" has been filed with the State Attorney General's. Office for the
November 2004 ballot. The attached material was provided with the League notification, and
includes excellent summary information and the official ballot language.
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1400 K Street, Suite 400 •Sacramento, California 95814
LEAGUE GALLFC�I NIA Phone: 916.658.8200 Fax: 916.658.8240
www•cacities.org
CITIES
October 30,2003
Dear City Colleague:
Last month at our Annual Conference the League General Assembly voted unanimously to
sponsor a statewide initiative to protect local revenues and services from raids and reductions by
state government.We are very pleased to share with you that today we joined the California State
Association of Counties and the Califon-da. Special Districts Association in filing the 'Local
Taxpayers and Public Safety Protection Act" with the Attorney General's office for the
November 2004 ballot. A copy is enclosed.
We are confident this initiative meets three important criteria: First, it protects the revenues and
services of local governments of every size, scope, region and fiscal condition. Second, it meets
the criteria of viability with the electorate by giving the voters —our residents —the ultimate say
on whether their local tax funds should be spent for local or state services. Third, it is simple and
straightforward.
After many months of drafting and literally years of research,we are proud of the work we have
submitted today. We deeply appreciate the help of the many city attorneys and county counsel in
developing this important ballot measure, and we look forward to moving into the next stage of
this important venture.
We want to be very clear that the real work has just begun. We will build an even broader
coalition in the next few months. In 45 — 60 days we will receive a title and summary for the
initiative from the Attorney General's office, and we will determine if it meets our goals. Finally,
all of us must help raise substantial private funds to run a successful campaign.
We know we can count m you in the months ahead to help with this cause. If you have any
questions,want to make a contribution,want to help raise private funds for the campaign,or want
to volunteer to help in some other way, we invite you to contact Mike Madrid, Public Affairs
Director for the League, at 916-658-8272 or at Mmadrid(acacities. You also can get
information about contributions or fundraising at www.citiT)ac.oand about the initiative at
www.cacities.orr
Thank you for your support, your patience and your dedication to this historic grassroots
campaign to save local democracy. We look forward to seeing you in the months ahead as we
move forward with this important effort.
Sincerely,
lff ��J
Ron Loveridge,President and Chris McKenzie,Executive Director
Mayor,City of Riverside
i
1400 K Street, Suite 400 • Sacramento, California 95814
LEAGUE
Phone: 916.658.8200 Fax: 916.658.8240
CSE CALIFORNIA
www.cacities.org
CITIES
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 stateand local tax revenues. In recent
years, the state legislature and governor 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 JIL9 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 b opkut 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(916658.8232).
How to Make A Contribution.The League has established a political action committee(CITIPAC—ID # 1254399)far
contributions to this initiative. For more information, contact 916-058-8273, email info@citipac.org or go to
www.citpac.org.
Revised October 30,2003
2
TALKING POINTS
LOCAL TAXPAYERS AND PUBLIC SAFETY PROTECTION ACT
• The filing of our measure represents the culmination of many months of work
and collaborative efforts with our partners at CSAC and the CSDA. It
represents the work, advice and suggestions of some of the state's expert
legal, policy and political minds who are intimately familiar with the challenges
and opportunities facing local government.
• This filing follows many months of research and polling. It addresses voters
opinions and concerns about the need for structural reform in California's
finances, their desire to see local taxes stay in their communities, their desire
to see police, fire, health and emergency services protected, and their belief
that they— the voters of the state—should have the ultimate decision when
the state seeks to raid funds designated for local government.
• This filing is another strong sign that all branches of local government are
working together for structural reform and remain united in their long term
relationship, committed to seeing the state and local fiscal relationship
resolved for mutual benefit.
• With the numerous alliances and unprecedented coalition built under the
LOCAL (Leave Our Community Assets Local) umbrella over the past few
years, our coalition is uniquely positioned to fight for the short term priorities
of local government in the budget process—but more importantly, we are also
capable of waging a statewide campaign effort simultaneously.
• In filing a measure in October, we are extremely encouraged at the pace of
the campaign, the fundraising structure and the political team we have put in
place. Though we also recognize that a number of significant hurdles remain,
our organization has been building towards and preparing for this time for well
over a year and we are well positioned for a campaign at this early phase.
• In the coming weeks, we will undergo an intense education process to inform
our members of the policy ramifications of the measure, while simultaneously
building on our political capacity and expanding our coalition to raise the
necessary funds and gather signatures to qualify the measure once we
receive title and summary.
3
The Local Taxpayers and Public
Safety Protection Act
Ensuring Voter Control Over Local Tax Dollars
for Public Health, Safety and Other Essential Local Services
The Problem:
For more than a decade, the California State Legislature has been taking away increasing
amounts of local tax dollars that local governments use to provide essential services like
police and fire protection, emergency and public health care, roads, parks, libraries and
water delivery. In fact,through good times and bad,the State has been taking away billions
in local tax dollars each year—forcing local governments to either raise local fees or taxes to
maintain services, or cut back on critically needed services.
The system is broken. Voters must act now to protect local services by protecting local
revenues from being taken by the State.
The Solution:
The 2004 Local Taxpayers and Public Safety Protection Act would increase local control
over our local tax dollars.This measure would let the voters have the final say on proposed
actions by the State Legislature that would further reduce local government funding. It would
protect the vital local services that California residents rely on each and every day—such as
public safety and emergency care, roads, libraries, parks and transportation—by requiring
voter approval before the State could reduce funding for local services or shift more costs to
local governments.
What this measure does:
O Requires voter approval before the Legislature can reduce local government revenues or
take them for state, rather than local, purposes.
O Ensures that local tax dollars are available to fund local services like police and fife,
emergency and trauma care, parks, roads, libraries and water delivery.
O Makes it absolutely clear that if the State Legislature mandates that local governments
provide new or expanded programs or services, then the State would have to reimburse
local governments for the cost of those programs.
O Provides flexibility for state budgeting decisions, but requires voter-approval on any
future State Legislative actions that would reduce funding for essential local services.
What this measure DOES NOT do:
O Does not raise taxes. In fact, this measure will help decrease pressures for local fees
and taxes by protecting local revenue sources from State raids.
O Does not increase funding to local governments. Simply prevents the State Legislature
from raiding future local government funding.
O Does not-reduce funding that schools receive from local property taxes or funding that
schools receive from the State.
O Does not reduce funding for other state programs like schools or highways.
4
THE LOCAL TAXPAYERS AND PUBLIC SAFETY PROTECTION ACT
SECTION ONE Short Title.
These amendments to the California Constitution shall be known and may be
cited as the LOCAL TAXPAYERS AND PUBLIC SAFETY PROTECTION ACT.
SECTION TWO. Findings and Purposes
(a) The People of the State of California find that restoring local control over local
tax dollars is vital to insure that local tax dollars are used to provide critical local services
including police, fire, emergency and trauma care, public health, libraries,criminal
justice, and road and street maintenance. Reliable funding for these services is essential
for the security, well-being and quality of life of all Californians.
(b) For many years, the Legislature has taken away local tax dollars used by local
governments so that the State could control those local tax dollars. In fact, the Legislature
has been taking away billions of local tax dollars each year, forcing local governments to
either raise local fees or taxes to maintain services, or cut back on critically needed local
services.
(c) The Legislature's diversion of local tax dollars from local governments harms
local governments' ability to provide such specific services as police, fire, emergency and
trauma care, public health, libraries, criminal justice, and road and street maintenance.
(d) In recognition of the harm caused by diversion of local tax dollars and the
importance placed on voter control of major decisions concerning government finance,
and consistent with existing provisions of the California Constitution that give the people
the right to vote on fiscal changes, the People of the State of California want the right to
vote upon actions by the State government that take local tax dollars from local
governments.
(e) The Local Taxpayers and Public Safety Protection Act is designed to insure
that the People of the State of California shall have the right to approve or reject the
actions of state government to take away local revenues that fund vitally needed local
services.
(f) The Local Taxpayers and Public Safety Protection Act strengthens the
requirement that if the State mandates local governments to implement new or expanded
programs, then the State shall reimburse local governments for the cost of those
programs.
(g) The Local Taxpayers and Public Safety Protection Act does not amend or
modify the School Funding Initiative, Proposition 98 (Article XVI, section 8 of the
California Constitution).
I
(h) Therefore, the People declare that the purposes of this Act are to:
(1)require voter approval before the Legislature removes local tax dollars
from the control of Local Government, as described in this measure;
(2) insure that local tax dollars are dedicated to local governments to fund
local public services;
(3) insure that the Legislature reimburses local governments when the
State mandates local governments to assume more financial responsibility
for new or existing programs; and
(4)prohibit the Legislature from deferring or delaying annual
reimbursement to local governments for state-mandated programs.
SECTION THREE. Article XIIIE is hereby added to the California Constitution to read
as follows:
ARTICLE X1l1lIE Local Taxpayers and Public Safety Protection Act
Section 1. State-wide Voter Approval Required
(a) Approval by a majority vote of the electorate, as provided for in this section,
shall be required before any act of the Legislature takes effect that removes the following
funding sources, or portions thereof, from the control of any Local Government as
follows:
(i) Reduces, or suspends or delays the receipt of, any Local
Government's proportionate share of the Local Property Tax when
the Legislature exercises its power to apportion the Local Property
Tax; or requires any Local Government to remit Local Property
Taxes to the State, a state-created fund, or, without the consent of
the affected Local Governments, to another Local Government;
(ii) Reduces, or delays or suspends the receipt of, the Local
Government Base Year Fund to any Local Government, without
appropriating funds to offset the reduction, delay or suspension in
an equal amount;
(iii) Restricts the authority to impose, or changes the method of
distributing, the Local Sales Tax;
(iv) Reduces, or suspends or delays the receipt of, the 2003 Local Government
Payment Deferral; or
(v) Fails to reinstate the suspended Bradle)L-Bums Uniform Sales Tax
Rate in accordance with Section 97.68 of the Revenue and
Taxation Code added by Chapter 162 of 2003 Statutes; or reduces
any Local Government's allocation of the Property Tax required
by Section 97.68 while the Sales Tax Rate is suspended.
2
(b) A vote of the electorate, as provided in this section, shall also be required if
an act of the Legislature that establishes classifications or exemptions from the Local
Property Tax or the Local Sales Tax does not include a continuous appropriation to
reimburse Local Governments for the actual loss of revenue from those classifications or
exemptions.
(c) Prior to its submission to the electorate, an act subject to voter approval under
this section must be approved by the same vote of the Legislature as is required to enact a
budget bill and shall not take effect until approved by a majority of those voting on the
measure at the next statewide election in accordance with subdivision(d).
(d) When an election is required by this section, the Secretary of State shall
present the following question to the electorate: "Shall that action taken by the
Legislature in [Chapter of the Statutes of_], which affects local revenues,be
approved?
Section 2. Definitions
(a) "Local Government"means any city, county, city and county, or special
district.
(b) "Local Government Base Year Fund" means the amount of revenue
appropriated in the 2002-2003 fiscal year in accordance with Chapters 1 through 5,
commencing with section 10701 of Part 5 of Division 2 of the Revenue and Taxation
Code in effect on August 9, 2003, adjusted annually based upon the change in assessed
valuation of vehicles that are subject to those provisions of law. In the event that the fees
imposed by those provisions of law are repealed, then the Fund shall be adjusted annually
on July 1 by an amount equal to the percentage change in per capita personal income and
the change in population, as determined pursuant to Article MMB.
(c) "2003 Local Government Payment Deferral" means the amount of revenues
required to be transferred to Local Government from the General Fund specified in
paragraph of subdivision 3 of subsection(a) of section 10754 of the Revenue and
Taxation Code as it read on August 9, 2003.
(d) "Local Property Tax"means any Local Government's January 1, 2003
proportionate share of ad valorem taxes on real property and tangible personal property
apportioned pursuant to the Legislature's exercise of its power to apportion property
taxes as specified in Article XIIIA, section 1. "Local Property Tax" also means any
Local Government's allocation of the ad valorem tax on real property and tangible
personal property pursuant to Article XVI, section 16.
(e) "Local Sales Tax" means any sales and use tax.impo sed by any city, county,
or city and county pursuant to the Bradley-Burns Uniform Sales and Use Tax (Chapter 1
of Part 1.5 of Division 2 of the Revenue and Taxation Code) in accordance with the law
in effect on January 1, 2003.
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M "Special District"means an agency of the State, formed pursuant to general
law or special act, for the local performance of governmental or proprietary functions
with limited geographic boundaries, including redevelopment agencies, but not including
school districts; community college districts, or county offices of education.
(g) "State" means the State of California..
Section 3. Interim Measures
(a)The operation and effect of any statute enacted between November 1, 2003
and the effective date of this Act, that would have required voter approval pursuant to
Section 1 if enacted on or after the effective date of this Act(the "Interim Statute"), shall
be suspended on that date and shall have no further force and effect until the date the
Interim Statute is approved by the voters at the first statewide election following the
effective date of this Act in the manner specified in Section 1. If the Interim Statute is
not approved by the voters, it shall have no further force and effect.
(b) If the Interim Statute is approved by the voters, it shall nonetheless have no
further force and effect during the period of suspension; provided, however; that the
statute shall have force and effect during the period of suspension if the Interim Statute or
separate act of the Legislature appropriates funds to affected local governments in an
amount which is not less than the revenues affected by the Interim Statute.
SECTION FOUR. Article XIIIB Section Six (6) is hereby amended as follows:
SEC. 6. (a) Whenever the Legislature or any state agency mandates a new program or
higher level of service on any local government, the State shall annually provide a
subvention of funds to reimburse such local government for the costs of such program or
increased level of service, except that the Legislature may, but need not, provide such
subvention of funds for the following mandates:
f*(i) Legislative mandates requested by the local agency affected;
(b} (ii) Legislation defining a new crime or changing an existing definition of a
crime;or
(s) (iii) Legislative mandates enacted prior to January 1, 1975, or executive orders
or regulations initially implementing legislation enacted prior to January 1, 1975.
(b) The annual subvention of funds required by this section shall be transmitted to the
local government within 180 days of the effective date of the statute or regulation or
order by a State officer or agency that mandates a new program or higher level of
service, or within 180 days of a final adjudication that a subvention of funds is required
pursuant to this section. For purposes of this section; the Legislature or any State
agency or officer mandates a new program or higher level of service when it creates a
new program, requires services not previously required to be provided, increases the
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frequency or duration of required services, increases the number of persons eligible for
services, or transfers to local government complete or partial financial responsibility for
a program for which the State previously had complete or partial financial responsibility.
(c)If during the fiscal year in which a claim for reimbursement is filed for a subvention
offunds, the Legislature does not appropriate a subvention offunds that provides full
reimbursement as required by subdivision (a), or does not appropriate a subvention of
funds that provides full reimbursement as part of the state budget act in the fiscal year
immediately following the filing of that claim for reimbursement, then a local government
may elect one of the following options:
(i) Continue to perform the mandate. The local government shall receive reimbursement
for its costs to perform the mandate through a subsequent appropriation and subvention
offunds; or
(ii) Suspend performance of the mandate during all or a portion of the fiscal year
in which the election permitted by this subdivision is made. The local government
may continue to suspend performance of the mandate during all or a portion of
subsequent fiscal years until the fiscal year in which the Legislature appropriates
the subvention offunds to provide full reimbursement as required by subdivision
(a). A local government shall receive reimbursement for its costs for that portion
of the fiscal year during which it performed the mandate through a subsequent
appropriation and subvention offunds.
The terms of this subdivision do not apply, and a local governmen.t may not make the
election provided for in this subdivision,for a mandate in effect on January 1, 2004 that
either requires safe working conditions for local government employees or establishes
procedural rights arising from and directly relating to local government employment,
(d)Forpurposes of this section, "mandate"means a statute, or action or order of any
state agency, which has been determined by the Legislature, any court, or the
Commission on State Mandates or its designated successor, to require reimbursement
pursuant to this section.
SECTION FIVE. Construction.
(a) This measure shall be liberally construed to effectuate its purposes, including
providing adequate funds to Local Government to fund local services such as police, fire,
emergency and trauma care, public health, libraries, criminal justice, and road and street
maintenance.
(b) This measure shall not be construed either to alter the apportionment of the ad
valorem tax on real property pursuant to Section 1 of Article )IIIA by any statute in
effect prior to January 1, 2003 or to prevent the Legislature from altering that
apportionment in compliance with the terms of this measure.
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(c) Except as provided in Section 3 of Article XIIIE added by Section Three of this Act,
the provisions of Section 1 of Article XIIIE added by Section Three of this Act apply to
all statutes adopted on or after the effective date of this Act.
SECTION SIX If any part of this measure or its application to any person or
circumstance is held invalid by a court of competent jurisdiction, the invalidity shall not
affect other provisions or applications that reasonably can be given effect without the
invalid provision or application.
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