HomeMy WebLinkAbout2006-04-25 - AGENDA REPORTS - PROP 24 GAS TAX (2)Agenda Item: __
CITY OF SANTA CLARITA
AGENDA REPORT
CONSENT CALENDAR City Manager Approval:
Item to be presented by: Mayor Pro Tem Marsha Mc ean
DATE: April 25, 2006
SUBJECT: SUPPORT FOR PROPOSTION 42 INITIATIVE TO ENSURE
STATE SALES TAXES ON GASOLINE ARE USED TO FUND
TRANSPORTATION IMPROVEMENTS AND TO PREVENT
LEGISLATURE AND GOVERNOR FROM DIVERTING
PROPOSITION 42 FUNDS TO NON -TRANSPORTATION
PROGRAMS
DEPARTMENT: City Manager's Office
RECOMMENDED ACTION
City Council support voter initiative protecting Proposition 42 funding and closing the provision
allowing funds to be redirected to non -transportation expenditures.
BACKGROUND
In 2002, 69% of California voters passed Proposition 42, dedicating state sales tax on gasoline to
fund specified state and local transportation projects, such as public transportation, road repairs,
transit and safety improvements, and congestion relief. The measure placed in the State
Constitution a requirement that, from 2003-04 to 2007-08, gasoline sales tax revenues be used
for specified transportation purposes including maintenance and improvements to local
highways, streets and roads, and transit systems. Beginning in 2008-09 revenues would continue
to be used for state and local transportation needs at the following schedule: 20% to public
transportation; 40% to the State Transportation Improvement Program, and; 40% to local streets
and roads improvements (split evenly between counties and cities).
However, Proposition 42 includes a provision that allows the legislature and Governor to divert
gasoline sales tax revenues to fund non -transportation state expenditures in the State General
Fund during fiscal emergencies. This provision has been used two out of the three budget years
since the propositions enactment, diverting more than $2.5 billion in gas taxes to
non -transportation expenses.
APPROWED
If qualified and passed by voters, the Prop. 42 initiative would: (1) prevent the diversion of
gasoline sales taxes to non -transportation expenses; (2) ensure revenues are dedicated to
transportation purposes; (3) require the state to reimburse the approximate $2.5 billion diverted
during FY 2003-04 and FY 2004-05, and; (4) permit the issuance of bonds by state and local
agencies repaid by revenues derived from the sales tax on gasoline. Approximately one million
signatures must be submitted by early May to qualify a constitutional amendment for the
November 2006 ballot. As of April 12, 891,000 signatures had been collected. Proponents of
the initiative include the League of California Cities, California State Senator George Runner,
and numerous cities, mayors, and councilmembers; There is no known opposition at this time.
Moreover, Assemblyman George Plescia (R- San Diego) authored a bill, ACA 4, which if passed
would repeal the constitutional provisions that allows the Legislature and Governor to transfer
gasoline sales tax revenue to the State's General Fund. ACA 4 was moved to the Assembly
Appropriations Committee on January 10, 2006, and requires a two-thirds vote of both houses of
the legislature to place on the ballot.
ALTERNATIVE ACTIONS
Other actions as determined by the City Council.
FISCAL IMPACT
The action to support the Proposition 42 Initiative does not require any resources beyond those
already accounted for in the City s adopted 2005/06 budget.
ATTACHMENTS
The Transportation Protection Act of 2006
ACA 4
1182. (SA2005RF0123)
Transportation Funding. Initiative Constitutional Amendment
and Statute.
Summary Date: 01103106 Circulation Deadline: 06/02/06 Signatures Required: 598,105
Proponent: James Earp, c% Richard D. Martland (916) 446-6752
Prohibits retention of funds earmarked for the Transportation Investment
Fund in the General Fund for use unrelated to transportation after 7/1/08.
Requires repayment by 6/30/17 of transportation funds retained in the
General Fund in years prior to 2007-08. Eliminates General Fund borrowing
of specified transportation funds, except for cash-flow purposes (repayment
required within 30 days of adoption of budget); current law allows
borrowing for three years where Governor declares transfer would cause
significant negative fiscal impact on governmental functions and Legislature
enacts authorizing statute. Summary of estimate by Legislative Analyst and
Director of Finance of fiscal impact on state and local governments: No
revenue or cost effects. Increases stability of funding to transportation in
2007-08 and thereafter; reduces somewhat the state's flexibility to use
specified transportation funds for other (nontransportation) activities.
(SA2005RF0123)
SECTION 1. TITLE.
This act shall be known, and may be cited as, The Transportation Funding Protection
Act of 2006,
SECTION 2, FINDINGS AND DECLARATIONS
The people find and declare as follows:
(a) California's roads and highways are deteriorating at a rapid pace.
(b) The cause of this deterlorattan Is the annual diversion by the Legistature of
state gasoline and diesel taxes for purposes other than Vansportatlon.
(c) The purpose of this Act Is to holt the diversions, preserve these revenues for
the transportation purposes to which they are dedicated, and require
repayment of transportation funds previously diverted for non -transportation
purposes.
(d) If a catastrophic natural disaster or other grave emergency causes serious
damage to California's transportation system, sufficient funds will be
Immediately available to repair the damage and rebuild the transportation
system.
SECTION 3. Seotton 6 of Article XIX is amended to read;
SECTION 6,
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1-1 m Wng4n-ri isaesUen ront-miliet4oing The Jmature
may, by statute, authorize loans to local transportation agencies, cities, counties, or ettics
and counties, from funds tint are subject to this article, for the purposos authorized under
this article, Any loen autivn ized as described by this subdivision r&JWA shall be repaid,
with interest at the tate paid on money in tho Pooled Money Investment Account, or any
successor to that account, daring the period of time that the money is loaned, to the fund
fust which it was borrowed, not later than four years atter the dato on which the loan
was made.
31^MON 4. Section l of Article XIX A is ropealcd.
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SECTION S. Section 1 of Article XIX S Is amended to read:
SECTION I. (a) For the 2003-04 fiscal year and each Fiscal year thereafter, nll moneys
drat are collected during the fiscal year from taxes under the Sales and Use Tax i.aw (Part
I (commmicing with Section 6001) of Division 2 of the Revenue and Taxation Code), or
any successor to that law, upon the sale, storage, use, or other consumption in this State
of motor vehicle tack end that are deposited in the 0enerol Fund of the State pursuant to
that law, shall be transfbrred to the Transportation Investment Fund, which Is hereby
created in the State Treasury.
(b) (I) For the 2003-04 to 200748 fiscal years, Inclusive, moneys In tiro Transpottation
Investment Fund shall be allocated, upon appropriation by the Legislature, in accordance
with Section 7104 of the Revenue and Taxation Code as that section read on ftte
'2-
epem5ive elate xRh1s-eKie1e Marsh 6.2002.
(2) For the 2008-09 tlsoal year and each fiscal year thereafter, moneys in the
Transportation Investment Fund shall be allocated solely for the following purposes:
(A) Public transit and mass transportation.
(B) Tnmsporlation capital Improvement projects, subject to the laws governing the
State Transportation Improvement Program, or say suecosaor to that program.
(C) Street and highway maintenance, rehabilitation, reconstruction, or storm damage
repair conducted by cities, ntoluding a city and county.
(D)"Street and highway maintenanco, rehabilitation, reconstruction, or storm damage
repair conducted by counties, including a city and county.
(c) For the 2008-09 fiscal year and each fiscal year thereafter, moneys in the
Transportation Investment Fund shall he allocated, upon appropriation by rite Legislature,
as fellows:
(A) Twenty percent of the moneys for the purposes sat forth in subparagraph (A) of
paragraph (2) of subdivision (b).
(B) Forty percent ofthe moneys for the purposes act forth In subparagraph (B) of
paragraph (2) of subdivision ft
(C} Twenty percent ofthe moneys for the purposes set forth in Subpar-agraph (C) of
paragraph (2) of subdivision (b).
(D) Twenty percent of the moneys for the purposo set forth in subparagraph (D) of
paragraph (2) of subdivision (b).
(d) The transfer of revenues from the General Fund of the State to the Transportation
Investment Fund pursuant to subdivision (a) may be suspended, in whole or in psrt, for a
any fiscal wwr precedme the 2007-08 fiscal year if both of the following conditions are
met:
(1) The Governor has issued a proclamation that doclares that the transfer of revenues
pursuant to subdivision (a) will result in a significant negative fiscsl Impact on the range
of functions of government fbnded by the General Fund of the State.
(2) The l.egislatnra enacts by statute, pursuant to a bill passed in each house of the
Legislature by rollcast vote entered in Iho journal, two-thirds of the membership
concurring, a suspension 1br that fiscal year of the transfer of revenues. pursuant to
subdivision (a), provided that the bill does not contain any other unrelated provision.
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(a) (Q The Legislature may enact a statute that modifies the percentage shares set iblth
in subdivision (c) by m bill passed in each house of the Legislature by rollcali vote entered
in the journal, two-thirds of the membership concurring, provided that the bill does nat
contain any other unrelated provision and that the moneys described in subdivision (a)
are expanded solely for the purposes set forth in paragraph (2) of subdivision (b).
SECTION 6. Article XIXC is added to the constitution to tend:
SECTION 1. Tax revenues designated in Articles XIX and XIX B. mud funds designated
in Article XIX A may be loaned to tate General Fund to meet the short term cash flow
needs of the state only if the loan in to be repaid in MR to the fund or account fiem which
it was borrowed during the same fiscal year in which the loan was made, except that
repayment may be delayed until a date not more than 30 days after the date of enactment
of the budget bill for the subsequent fiscal year. In no event shall any Ioan authorized
herein impede in any manner the transportation purpose for which the revenues are
generated and exist.
SECTION 7. ConflictingBallot Measu rs
In the- event that this measure and another mcasurc or measures relating to the disposition
of transportation revenues shall appear on the same statewide election ballot, rho
provisions of the other monsuros shall be deemod to be in conflict with this measure, In
the event that this measure shall receive a greater nurnbcr of affirmative votes, the
provisions of this measure shall provail in their entirety, and the provisions of the other
measures shall be null and void,
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AMENDED IN ASSEMBLY MAY 9, 2005
CALIFORNIA LEGISLATURE-2Oo5-06 REGULAR SESSION
Assembly Constitutional Amendment No. 4
Introduced by Assembly Members Plescia and Harman
( Coauthors: Assembly
Members Benoit, Blakeslee, Bogh, Canciamilla, Cogdill, DePare,
Garcia, Haynes, Houston, Huff, La Suer, Matthews, Maze,
Mountjoy, Sharon Runner, Spitzer, Tran, and Walters)
(Coauthors: Senators Denham, Dutton, Maldonado, Margett, and
Morrow)
December 6, 2004
Assembly Constitutional Amendment No. 4—A resolution to
propose to the people of the State of California an amendment to the
Constitution of the State, by amending Section 1 of Article XD{ B
thereof, relating to transportation.
LEGISLATIVE COUNSEL'S DIGEST
ACA 4, as amended, Plescia. Transportation Investment Fund.
Article XD{ B of the California Constitution requires, commencing
with the 2003-04 fiscal year, that sales taxes on motor vehicle fuel
that are deposited into the General Fund be transferred to the
Transportation Investment Fund for allocation to various
transportation purposes. Article XIX B authorizes this transfer to the
Transportation Investment Fund to be suspended in whole or in part
for a fiscal year during a fiscal emergency pursuant to a proclamation
by the Governor and the enactment of a statute by a 2/3 vote in each
house of the Legislature if the statute does not contain any unrelated
provision.
This measure would delete the provision authorizing the Governor
and the Legislature to suspend the transfer of revenues from the
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ACA 4
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General Fund to the Transportation Investment Fund for a fiscal year
during a fiscal emergency.
Vote: 2/3. Appropriation: no. Fiscal committee: no.
State -mandated local program: no.
1 Resolved by the Assembly, the Senate concurring, That the
2 Legislature of the State of California at its 2005-06 Regular
3 Session commencing on the sixth day of December 2004,
4 two-thirds of the membership of each house concurring, hereby
5 proposes to the people of the State of California, that the
6 Constitution of the State be amended as follows:
7 That Section 1 of Article XIX B thereof is amended to read:
8 SECTION 1. (a) For the 2003-04 fiscal year and each fiscal
9 year thereafter, all moneys that are collected during the fiscal
10 year from taxes under the Sales and Use Tax Law (Part 1
11 (commencing with Section 6001) of Division 2 of the Revenue
12 and Taxation Code), or any successor to that law, upon the sale,
13 storage, use, or other consumption in this State of motor vehicle
14 fuel, and that are deposited in the General Fund -`-or
15 pursuant to that law, shall be transferred to the Transportation
16 Investment Fund, which is hereby created in the State Treasury.
17 (b) (1) For the 2003-04 to 2007-08 fiscal years, inclusive,
18 moneys in the Transportation Investment Fund shall be allocated,
19 upon appropriation by the Legislature, in accordance with
20 Section 7104 of the Revenue and Taxation Code as that section
21 read on March 6, 2002.
22 (2) For the 2008-09 fiscal year and each fiscal year thereafter,
23 moneys in the Transportation Investment Fund shall be allocated
24 solely for the following purposes:
25 (A) Public transit and mass transportation.
26 (B) Transportation capital improvement projects, subject to the
27 laws governing the State Transportation Improvement Program,
28 or any successor to that program.
29 (C) Street and highway maintenance, rehabilitation,
30 reconstruction, or storm damage repair conducted by cities,
31 including a city and county.
32 (D) Street and highway maintenance, rehabilitation,
33 reconstruction, or storm damage repair conducted by counties,
34 including a city and county.
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1 (c) For the 2008-09 fiscal year and each fiscal year thereafter,
2 moneys in the Transportation Investment Fund shall be allocated,
3 upon appropriation by the Legislature, as follows:
4 (A) Twenty percent of the moneys for the purposes set forth in
5 subparagraph (A) of paragraph (2) of subdivision (b).
6 (B) Forty percent of the moneys for the purposes set forth in
7 subparagraph (B) of paragraph (2) of subdivision (b).
8 (C) Twenty percent of the moneys for the purposes set forth in
9 subparagraph (C) of paragraph (2) of subdivision (b).
10 (D) Twenty percent of the moneys for the purpose set forth in
11 subparagraph (D) of paragraph (2) of subdivision (b).
12 (d) The Legislature may enact a statute that modifies the
13 percentage shares set forth in subdivision (c) by a bill passed in
14 each house of the Legislature by rollcall vote entered in the
15 journal, two-thirds of the membership concurring, provided that
16 the bill does not contain any other unrelated provision and that
17 the moneys described in subdivision (a) are expended solely for
18 the purposes set forth in paragraph (2) of subdivision (b).
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