HomeMy WebLinkAbout1990-05-29 - RESOLUTIONS - TAX EXEMPT BONDS PRESERVATION (2)RESOLUTION NO. 90-94
^ A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF SANTA CLARITA, CALIFORNIA,
TO PRESERVE TAX-EXEMPT BONDS FOR
STATE AND LOCAL GOVERNMENTS
WHEREAS, the productive capacity of the American economy and the
health, safety and welfare of the nation depend upon the quality of a reliable
infrastructure and the availability of adequate basic public facilities and
services, and
WHEREAS, the principles of federalism, which have served this nation
for more than 200 years, include the immunity of states and local governments
from federal taxation of interest for public functions in order to maintain
the balance of power between states, and the federal government, and
WHEREAS, the federal government has steadily reduced its
responsibility for infrastructure requirements, and has shifted more and more
financial responsibility to states and units of local governments, and
WHEREAS, financing state and local government projects through the
issuance of bonds, the interest on which is not taxed by the federal
government, is critical to allow states and local governments to exercise the
responsibilities entrusted to and expected of them, and
WHEREAS, in recent years, the U.S. Congress has both limited the use
of tax-exempt bonds by states and local governments and made municipal bonds
less attractive to significant groups of purchasers, thereby driving up the
cost of financing public service projects, and
WHEREAS, the U.S. Supreme Court overturned a 100 -year-old precedent,
ruling for the first time that the Constitution does not prohibit the federal
government from taxing the interest on state and local governments bonds, and
WHEREAS, state and local borrowing costs will increase by an
estimated 20 to 30 percent if the interest on tax-exempt bonds is subject to
federal income tax, and this added burden will be reflected in reductions in
public services or by increased state and local taxes, and
WHEREAS, shifting the tax burden from the national level to state
and local governments is an illusory savings for taxpayers and provides no net
tax relief, and
WHEREAS, further restrictions on the use of tax-exempt bonds will
seriously impair the ability of state and local governments to finance
essential services and facilities, including schools, hospitals, prisons,
roads, water, gas, electric, sewer, transportation and other basic functions,
to the detriment of all citizens;
RESOLUTION NO. 90-94
Page 2
NOW, THEREFORE, BE IT RESOLVED: that the City of Santa Clarita
calls upon Congress and the President to recognize that the state and local
burden of maintaining and expanding the national infrastructure and providing
citizens with needed basic governmental services cannot be met without
tax-exempt bonds, and to resist all further efforts to reduce the use of such
bonds to finance governmental projects.
SECTION 1. The City Clerk shall certify to the adoption of this
Resolution and certify this record to be a full, true, correct copy of the
action taken.
PASSED, APPROVED, AND ADOPTED this 29thday of May , 1990.
I HEREBY CERTIFY that the foregoing Resolution was duly adopted by
the City Council of the City of Santa Clarita, at a regular meeting thereof,
held on the 29th day of May , 1990, by the following vote of
the Council:
AYES: COUNCILMEMBERS Boyer, Heidt, Klajic, McKeon, Darcy
NOES: COUNCILMEMBERS None
ABSENT: COUNCILMEMBERS None
/V
GEORGE CARAVALHO, C ply
CLERK