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HomeMy WebLinkAbout1990-01-09 - AGENDA REPORTS - SCHOOL FACILTIES SCA-18 (2)AGENDA REPORT City Manager Approval Item to be presented by: City Manager NEW BUSINESS DATE: January 9, 1990 SUBJECT: Senate.Constitutional Amendment No. 18 DEPARTMENT: City Manager's Office BACKGROUND Last year, the State Constitutional Amendment 18 (SCA -18) was introduced by Senator Edward Davis to address the ever increasing problem of a lack of adequate funding for school facilities. With a lack of representation to speak on behalf. of SCA -18 the measure failed. Reconsideration has been granted for SCA -18 and the measure will be heard once more before the Senate Revenue and Taxation Committee on January 17, 1990. SCA -18 will allow voters to enact an increase of the state sales and use tax rate by 0.25% for a period of 10 years, and would require the proceeds of the increase to be used for school facilities, kindergarten and grades 1 to 12. In California, this measure would raise approximately $7 billion. Additionally, it would remove the need to continue to pass very expensive general obligation bonds every two years and the uncertainty from school facility funding by providing a guaranteed source of funding. For the City of Santa Clarita, searching for alternative methods for funding for school facilities to address continued rapid growth of the area and to relieve our present school overcrowding situation is a very important local concern to the community. In support of SCA -18 City Council may wish to designate a representative to appear at the hearing on SCA -18 to testify on behalf of the citizens of Santa Clarita. RECOMMENDATION Direct City staff to prepare a letter of support on SCA -18, authorize Mayor to sign letter and Council to designate representatives) to appear and attend hearing in Sacramento to testify in support of SCA -18. ATTACHMENTS Letter from Senator Ed Davis Copy of Senate Constitutional Amendment 18. PMI Agenda ltem:,-2�2 CA SCA 18 01/04/90 Page 1 SENATE CONSTITUTIONAL AMENDMENT No. 18 Introduced by Senator Davis March 6, 1989 Senate Constitutional Amendment No. 18--A resolution to propose to the people of the State of California an amendment to the Constitution of the State, by adding Section 34 to Article XIII and Section 13 to Article XIIIB thereof, relating to taxation. LEGISLATIVE COUNSEL'S DIGEST SCA 18, as introduced, Davis. Sales and use taxes. Under existing provisions of the Sales and Use Tax Law, a state sales or'use tax on the sale or consumption of tangible personal property within California is imposed at the rate of 4.750. In addition, under existing law, counties and cities are authorized to impose local sales and use taxes, at specified rates, in conformity with state sales and use taxes. This measure would increase the state sales and use tax rate by 0.25% for a period of 10 years, and would require the proceeds of that sales and use tax increase to be used for school facilities used for kindergarten and grades 1 to 12, inclusive. The measure would require the Legislature to determine the need for the continuation of the sales and use tax increase required by this measure, and if it determines that the tax rate increase should be retained for another 10 years, would authorize the Legislature to submit that proposal to the electorate. Existing provisions of Article XIIIB of the California Constitution prohibit the annual appropriations subject to limitation, as defined, of any governmental entity from exceeding its annual appropriations limit and provides for annual adjustments in that limit based on changes in the cost of living and population, calculated in a certain manner. Existing provisions of Article XIIIB also specify that appropriations subject to that limitation do not include debt service, certain appropriations required for purposes of complying with mandates of the court or'the federal government, appropriations of special districts which existed on January 1, 1978; and did not levy a CA SCA 18 01/04/90 Page 2 property tax in excess of a specified rate, appropriations of special districts which are funded by other than the proceeds of taxes, and appropriations of revenue from the Cigarette and Tobacco Products Surtax Fund. This measure would also exclude from that limitation appropriations of revenues from the increased sales and use tax rate imposed pursuant to this measure. The measure would become operate on the 1st day of the calendar quarter commencing more than 90 days after the effective date of this measure. Vote: 2/3. Appropriation: no. Fiscal committee: yes. State -mandated local program: no. Resolved by the Senate, the Assembly concurring, That the Legislature of the State of California at its 1989-90 Regular Session commencing on the fifth day of December 1988, two-thirds of the members elected to each of the two houses of the Legislature voting therefor, hereby proposes to the people of the State of California that the Constitution of the State be amended as -follows: First --That Section 34 is added to Article XIII, to read: SEC. 34. (a) In addition to any other taxes imposed on the sale or use of tangible personal property pursuant to the Sales and Use Tax Law, there is hereby imposed an additional tax of .25 percent. (b) For all purposes except subdivision.(c), the tax imposed by subdivision (a) shall be a portion of the tax imposed under the Sales and Use Tax Law as it read on January 1, 1989, or as subsequently amended. (c) Revenues derived from the increased sales -and use tax rate imposed pursuant to subdivision (a) shall be used only for funding of school facilities used for kindergarten and grades 1 to 12, inclusive. (d) Revenues shall be allocated by the State Allocation Board in accordance with the procedures in effect on January 1, 1989. (e) The tax imposed by subdivision (a) shall remain in effect for 10 years from the date it is first imposed. Prior to the expiration of the 10 -year period, the Legislature shall determine if funds available for additional funding of school facilities in the absence of the tax will be sufficient to meet projected needs for the ensuing 10 -year period. If the Legislature determines that funds will not be sufficient for those purposes, it may submit to the voters the question of whether the tax imposed by subdivision (a) shall be extended for an additional 10 -year period. Second= -That Section 13 is added to Article.XIIIB, to read: SEC. 13. "Appropriations subject to limitation" of each entity of government shall not include appropriations of revenue from the CA SCA 18 01/04/90 Page 3 additional sales and use tax imposed pursuant to Section 34 of Article XIII. No adjustment to the appropriations limit of any entity of government shall be required pursuant to Section 3 as a result of these revenues being deposited in or appropriated from any fund. Third --That the provisions of this measure shall become operative on the first day of the first calendar quarter commencing more than 90 days after the effective date of this measure. END OF REPORT _ ED DAVIS E PTR^Tfr:v NINETEENTH SENATORIAL DISTRICT REPRESENTING PORTIONS OF LOS ANGELES. ¢ '✓�;-��,�`- SANTA BARBARA. AND VENTURA COUNTIES I Calif ornia 6tate enat December 28 , 1989 Ms. Jo Anne Darcy Mayor, City of Santa Cla'rita 23920 Valencia Blvd., Suite 300 Santa Clarita, CA 91355 Dear Ms. Darcy: COMMITTEES: JUDICIAR'I VICE CHAIRfI- BAN-IG AND COMMERC:i- BUDGET B FISCAL REVIEV. EDUCATIG': t4-LCiSELECT COMMITTEES: BORDER ISSUES. DRUG TRAFFICKING AND CONTRABAND (C.. GOVERNMENTAL EFFICIENC! (: MOTION PIG TUR E. TELERECORD",' ' COMMERCIAL & RECORCIf:G INDUSTRIES ` W _ SUBSTANCE ABUSE JOINT COMMITTEES: e FIRE PGJCE EMERGENCY AND L� DISASTER SERVICES ORGANIZED G E a GANG vIOLENCENc U ❑ STATE CAPITOL _ .;... SACRAMENTO. CA 95814 TELEPHONE: (916) 445-8873 ❑ DISTRICT OFFICE 11145 TAMPA AVENUE SUITE 218 NORTHRIDGE. CA 91326 TELEPHONE: (818) 368-1171 _ ED DAVIS E PTR^Tfr:v NINETEENTH SENATORIAL DISTRICT REPRESENTING PORTIONS OF LOS ANGELES. ¢ '✓�;-��,�`- SANTA BARBARA. AND VENTURA COUNTIES I Calif ornia 6tate enat December 28 , 1989 Ms. Jo Anne Darcy Mayor, City of Santa Cla'rita 23920 Valencia Blvd., Suite 300 Santa Clarita, CA 91355 Dear Ms. Darcy: COMMITTEES: JUDICIAR'I VICE CHAIRfI- BAN-IG AND COMMERC:i- BUDGET B FISCAL REVIEV. EDUCATIG': t4-LCiSELECT COMMITTEES: BORDER ISSUES. DRUG TRAFFICKING AND CONTRABAND (C.. GOVERNMENTAL EFFICIENC! (: MOTION PIG TUR E. TELERECORD",' ' COMMERCIAL & RECORCIf:G INDUSTRIES ` W _ SUBSTANCE ABUSE JOINT COMMITTEES: e FIRE PGJCE EMERGENCY AND L� DISASTER SERVICES ORGANIZED G E a GANG vIOLENCENc As you are well aware, the lack of funding for adequate school facilities is becoming a major problem for this state. Last year I introduced SCA 18, which would allow the voters to enact a 1/4 cent sales tax for 10 years to pay for new facilities. This proposal would raise approximately $7 billion and would remove the need to continue to pass very expensive general obligation bonds every two years. In addition, it would remove the uncertainty from school facility funding by providing a guaranteed source of funding. When SCA 18.was heard in the Senate Revenue and Taxation Committee last year, no representatives of the school facility lobby or the developers appeared to speak on behalf of the bill, and it failed. Reconsideration was granted and SCA 18 will be heard once again on January 17th in the.Senate Revenue and axT ation Committee. elieve that this proposal would be a major step forward in resolving the current political stalemate on resolving the school facility funding crisis. I hope that you will agree to support this measure and appear at the hearing to testify. Please contact my Administrative Assistant, Hunt Braly, if you have any questions. Sincerely, RD DAVIS U _ .;... As you are well aware, the lack of funding for adequate school facilities is becoming a major problem for this state. Last year I introduced SCA 18, which would allow the voters to enact a 1/4 cent sales tax for 10 years to pay for new facilities. This proposal would raise approximately $7 billion and would remove the need to continue to pass very expensive general obligation bonds every two years. In addition, it would remove the uncertainty from school facility funding by providing a guaranteed source of funding. When SCA 18.was heard in the Senate Revenue and Taxation Committee last year, no representatives of the school facility lobby or the developers appeared to speak on behalf of the bill, and it failed. Reconsideration was granted and SCA 18 will be heard once again on January 17th in the.Senate Revenue and axT ation Committee. elieve that this proposal would be a major step forward in resolving the current political stalemate on resolving the school facility funding crisis. I hope that you will agree to support this measure and appear at the hearing to testify. Please contact my Administrative Assistant, Hunt Braly, if you have any questions. Sincerely, RD DAVIS