Loading...
HomeMy WebLinkAbout03 - Statewide Initiative Requiring Voter Approval Before State Diverts Local RevenuesCITY OF NEWPORT BEACH CITY COUNCIL STAFF REPORT Agenda Item No. 3 October 28, 2003 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: Homer L. Bludau, City Manager 949 - 644 -3000, HBludau @city.newport- beach.ca.us SUBJECT: CITY COUNCIL SUPPORT FOR A STATEWIDE INITIATIVE REQUIRING VOTER APPROVAL PRIOR TO THE STATE DIVERTING LOCAL REVENUES ISSUE: Does the City Council want to go on record in support of a statewide ballot initiative requiring voter approval prior to the State legislature diverting local government revenues? RECOMMENDATION: Adopt Resolution No. 2003 -_ supporting a statewide ballot initiative to require voter approval before state government may take local revenue. DISCUSSION: Background: Cities and counties within California are creatures of the State. Whereas, local government used to be much more autonomous, the passage of Proposition 13 in 1968 resulted in a reduction on local governments' reliance on property taxes as its greatest revenue source and a great reliance on the State for revenues. This reliance has made local governments very vulnerable to the State legislature during poor economic times. For example, since 1993, Newport Beach has lost $43,568,711 from a property tax shift of approximately 15 %. For FY 2003/04, the City is losing about $800,000 to the State in VLF fees and library augmentation funds. One place the State legislature has proven to be creative is in the ways it has found to tap into local government revenue sources. The League of California Cities intends to sponsor an initiative on the November, 2004 ballot which would require a statewide vote prior to the State re- allocating or re- City Council Support for a Statewide Initiative Requiring Voter Approval Prior to the State Diverting Local Revenues October 28, 2003 Page 2 appropriating local government revenues. The State's record on treating local government as a source of revenue during poor economic times is consistent and has not served the best interests of California residents. The City Manager urges the City Council to support the initiative in order to best protect its ability to provide the high level of services this community pays fees and taxes for and deserves. Submitted by: Homer L. Bludau ity Manager Attachments: Resolution No. 2003- RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COUNCIL OF NEWPORT BEACH CALIFORNIA SUPPORTING A STATEWIDE BALLOT INITIATIVE TO REQUIRE VOTER APPROVAL BEFORE STATE GOVERNMENT MAY TAKE LOCAL TAX FUNDS WHEREAS, state government annually removes over $800 million from local government in 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, 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, 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. 1 NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH, CALIFORNIA, 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 RESOLVED FURTHER, that the City Clerk is hereby directed to send a copy to the Executive Director of the League of California Cities. ADOPTED on this 28th day of October, 2003. ATTEST: LaVonne Harkless, City Clerk Mayor Steven Bromberg 2