HomeMy WebLinkAbout2003-5 - Local Vehicle License Fees RevenuesRESOLUTION NO. 2003-5
A RESOLUTION OF THE CITY COUNCIL OF NEWPORT
BEACH CALIFORNIA URGING THE CALIFORNIA
LEGISLATURE TO REJECT THE GOVERNOR'S
PROPOSED REDUCTION OF LOCAL VEHICLE LICENSE
FEE REVENUES PROVIDED TO LOCAL GOVERNMENTS
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 and backfill revenues constitute 15 to 25 percent of typical
city and county general purpose revenues. On average, more than 60 percent of
city general fund spending and more than half of county general funds go to
front line law enforcement, fire, emergency medical services, and health care
programs.
WHEREAS, revenues derived from the VLF and backfill are of critical
importance in funding vital local public health and safety services; and
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WHEREAS, any failure by the Legislature to maintain the VLF backfill will
cause widespread disruption in local government services essential to the well-
being 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 is a direct assault on local services
that will be felt by every California resident; and
WHEREAS, shifting $4.2 billion in locally controlled revenues for local
services is neither equitable nor fair. No state program or department has been
asked to shoulder such a disproportionate share of the budget pain. These cuts
come on top of the nearly $5 billion each year that is transferred from local
services to fund state obligations.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF
NEWPORT BEACH, CALIFORNIA, that the State General Fund continue to
"backfill" VLF collections and to do so by making budget cuts from State
operations and programs that do not affect local government.
ADOPTED on this 28th day of January 20
Mayor Steven Bromberg
ATTEST:
LaVonne Harkless, City Clerk 0 i
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STATE OF CALIFORNIA }
COUNTY OF ORANGE
CITY OF NEWPORT BEACH }
I, Leilani I. Brown, Deputy City Clerk of the City of Newport Beach, California, do
hereby certify that the whole number of members of the City Council is seven; that the foregoing
resolution, being Resolution No. 2003 -5 was duly and regularly introduced before and adopted by the
City Council of said City at a regular meeting of said Council, duly and regularly held on the 28th
day of January, 2003, and that the same was so passed and adopted by the following vote, to wit:
Ayes: Heffernan, Proctor, Ridgeway, Adams, Webb, Nichols, Mayor Bromberg
Noes: None
Absent: None
Abstain: None
IN WITNESS WHEREOF, I have hereunto subscribed my name and affixed the
official seal of said City this 29th day of January, 2003.
d 4. LRrvw�� -
1p Deputy City Clerk
Newport Beach, California
(Seal)