HomeMy WebLinkAbout2012-05-22 - AGENDA REPORTS - SB 1566 (2)Agenda Item: 5
CITY OF SANTA CLARITA
AGENDA REPORT
CONSENT CALENDAR City Manager Approval
Item to be presented by
DATE: May 22, 2012
SUBJECT: STATE LEGISLATION: SB 1566
DEPARTMENT: City Manager's Office
RECOMMENDED ACTION
Michael P. Murphy
City Council adopt the recommendation of the City Council Legislative Committee and adopt a
"support" position for Senate Bill 1566 (Negrete McLeod) and transmit letters of support to
Senator Negrete McLeod, Santa Clarita's state legislative delegation, appropriate legislative
committees, Governor Brown, and League of California Cities.
BACKGROUND
SB 1566 was introduced by Senator Gloria Negrete McLeod (D -32 -Chino) on February 24, 2012.
Last year, as part of the effort to resolve the state's budget crisis, the Legislature passed and
Governor Brown signed into law, Senate Bill 89, Chapter 35, Statutes of 2011, which redirected
Vehicle License Fees away from cities, particularly newly incorporated cities, cities annexing
areas into their municipal boundaries, and Department of Motor Vehicle Administration to the
Local Law Enforcement Account to help fund public safety realignment.
Newly incorporated cities and cities that annex areas into their municipal boundaries, prior to
undertaking the incorporation or annexation, make a financial viability calculation, based upon
anticipated receipt of specified revenues. In the case of four recently incorporated California
cities, located in Riverside County, the loss of Vehicle License Fee revenue, traditionally a local
government revenue source, creates a significant financial crisis that could potentially result in
disincorporation for one or more of those cities.
Last year's state budget redirect of Vehicle License Fees cost the City of Santa Clarita
S 1,018,000. Senate Bill 1566 would restore a portion of the taking from the state in the amount
of approximately $391,000.
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UPHOWED
On May 8, 2012, the City Council Legislative Committee met and voted to recommend a
"support" position to the full City Council.
ALTERNATIVE ACTIONS
1. Adopt an 'oppose" position on SB 1566.
2. Take no position on SB 1566.
3. Other direction as determined by the City Council.
FISCAL IMPACT
No fiscal impact by this action.
ATTACHMENTS
SB 1566 - Negrete McLeod and Emmerson
AMENDED IN SENATE APRIL 10, 2012
SENATE BILL No. 1566
Introduced by Senators Negrete McLeod and Emmerson
(Coauthor: Senator De Leon)
(Coauthors: Assembly Members Carter, Cook, Jeffries, Miller, Nestande,
and Smyth)
February 24, 2012
An act to amend Sections 11003 and 11005 of the Revenue and
Taxation Code, relating to taxation, and making an appropriation
therefor.
LEGISLATIVE COUNSEL'S DIGEST
SB 1566, as amended, Negrete McLeod. Vehicle license fees:
allocation.
Existing law requires that a specified amount of motor vehicle license
fees deposited to the credit of the Motor Vehicle License Fee Account
in the Transportation Tax Fund be allocated by the Controller, as
specified, to the Local Law Enforcement Services Account in the Local
Revenue Fund 2011, for allocation to cities, counties, and cities and
counties.
This bill would instead require, on and after July 1, 2012, that those
revenues be distributed first to each city that was incorporated from an
unincorporated territory after -August 5, 2004, in an amount determined
pursuant to a specified formula—utd, second to each city that was
incorporated before August 5, 2004, in an amount determined pursuant
to a specified formula, and third to the Local Law Enforcement Services
Account in the Local Revenue Fund 2011, for allocation to cities,
counties, and cities and counties. By authorizing within the Motor
Vehicle License Fee Account in the Transportation Tax Fund, a
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continuously appropriated fund, to be used for a new purpose, the bill
would make an appropriation.
Existing law requires the Legislature to determine and appropriate
annually an amount for the use of the Department of Motor Vehicles
and the Franchise Tax Board for the enforcement of theVehicle License
Fee Law.
This bill would not allow that amount to be appropriated from the
Motor Vehicle License Fee Account in the Transportation Tax Fund.
Vote: majority. Appropriation: yes. Fiscal committee: yes.
State -mandated local program: no.
The people of the State of California do enact as follows:
I SECTION I. The Legislature finds and declares all of the
2 following:
3 (a) It is the intent of the Legislature commencing with the
4 2012-13 fiscal year to reinstate allocations of motor vehicle license
5 fees to recently incorporated cities and cities which annexed
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inhabited areas, consistent with the allocation formula those
communities relied upon when making the decision to incorporate
or annex the affected territory.
(b) It is also the intent of the Legislature to ensure that such
revenues and incentives remain available for other communities
considering incorporation, including unincorporated communities
of East Los Angeles, and annexations of inhabited areas, including
disadvantaged unincorporated communities.
(c) Numerous state laws support the policy of furthering orderly
development in compact forms, including the annexation of
inhabited territory and the incorporation of communities consistent
with state laws, the policies of local agency formation
commissions, and often the approval of local voters.
(d) The passage of Senate Bill 89 of the 2011-12 Regular
Session (Chapter 35 of the Statutes of 2011) removed critical
revenues from these communities without providing a reasonable
opportunity for input from the affected agencies and the public.
SEC. 2. Section 11003 of the Revenue and Taxation Code is
amended to read:
11003. The Legislature shall annually determine and
appropriate an amount for the use of the Department of Motor
Vehicles and the Franchise Tax Board for the enforcement of this
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1 part. That amount shall not be appropriated from the Motor Vehicle
2 License Fee Account in the Transportation Tax Fund.
3 SEC. 3. Section 11005 of the Revenue and Taxation Code is
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amended to read:
11005. After payment of refunds therefrom and reserving the
amount determined necessary by the Pooled Money Investment
Board to meet the transfers ordered or proposed to be ordered
pursuant to Section 16310 of the Government Code, the balance
of all motor vehicle license fees and any other money appropriated
by law for expenditure pursuant to this section, deposited to the
credit of the Motor Vehicle License Fee Account in the
Transportation Tax Fund, and remaining unexpended in that
account at the close of business on the last day of the calendar
month, shall be allocated by the Controller by the l Oth day of the
following month in accordance with the following:
(a) On and after July 1, 2012:
(1) First, to each city that was incorporated from an
unincorporated territory after August 5, 2004, in an amount equal
to the product of the following two amounts:
(A) The quotient derived from the following fraction:
(i) The numerator is the product of the following two amounts:
(1) Fifty dollars ($50) per year.
(ll) The fraction determined as the total amount of vehicle
license fee revenue collected during the'most recent fiscal year
divided by the total amount of vehicle license fee revenue collected
during the 2004-05 fiscal year.
(ii) The denominator is the fraction determined as the actual
population, as defined in subdivision (d) of Section 11005.3, of
all cities during the most recent fiscal year, divided by the actual
population, as defined in subdivision (d) of Section 11005.3, of
all cities in the 2004-05 fiscal year.
(B) The city's population determined in accordance with Section
11005.3.
(2) Second, to each city that was incorporated before August 5,
2004, in an amount equal to the product of the following two
amounts:
(A) The quotient derived from the following fraction:
(i) The numerator is the product of the following two amounts:
(1) Fifty dollars ($50) per year.
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(11) The fraction determined as the total amount of vehicle
license fee revenue collected during the most recent fiscal year
divided by the total amount of vehicle license fee revenue collected
during the 2004-05 fiscal year.
(ii) The denominator is the fraction determined as the actual
population, as defined in subdivision (d) of Section 11005.3, of
all cities during the most recent fiscal year, divided by the actual
population, as defined in subdivision (d) of Section 11005.3, of
all cities in the 2004-05 fiscal year.
(B) The actual population, as defined in subdivision (d) of
Section 1 1005.3, residing in areas annexed after August 5, 2004,
as of the date of annexation.
(3) Third, to the Local Law Enforcement Services Account in
the Local Revenue Fund 2011, as established by Section 30025 of
the Government Code, for allocation to cities, counties, and cities
and counties.
(b) On and after July 1, 2011, and before July 1, 2012, to the
Local Law Enforcement Services Account in the Local Revenue
Fund 2011, as established by Section 30025 of the Government
Code, for allocation to cities, counties, and cities and counties.
(c) On or after July 1, 2004, but before July 1, 2011:
(1) First, to the County of Orange. For the 2004-05 fiscal year,
that county shall be allocated fifty-four million dollars
($54,000,000) in monthly installments. For the 2005-06 fiscal year
and each fiscal year thereafter, that county shall receive, in monthly
installments, an amount equal to the amount allocated under this
section for the prior fiscal year, adjusted for the percentage change
in the amount of revenues credited to the Motor Vehicle License
Fee Account in the Transportation Tax Fund from the revenues
credited to that account in the prior fiscal year. Moneys allocated
to the County of Orange under this subdivision shall be used first
for the service of indebtedness as provided in paragraph (1) of
subdivision (a) of Section 11001.5. Any amounts in excess of the
amount required for this service of indebtedness may be used by
that county for any lawful purpose.
(2) Second, to each city, the population of which is determined
under Section 11005.3 on August 5, 2004, in an amount equal to
the additional amount of vehicle license fee revenue, including
offset transfers, that would be allocated to that city under Sections
11000 and 11005, as those sections read on January I, 2004, as a
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result of that city's population being determined under subdivision
(a) or (b) of Section 11005.3.
(3) Third, to each city that was incorporated from an
unincorporated territory after August 5, 2004, in an amount equal
to the product of the following two amounts:
(A) The quotient derived from the following fraction:
(i) The numerator is the product of the following two amounts:
(1) Fifty dollars ($50) per year.
(11) The fraction determined as the total amount of vehicle
license fee revenue collected during the most recent fiscal year
divided by the total amount of vehicle license fee revenue collected
during the 2004-05 fiscal year.
(ii) The denominator is the fraction determined as the actual
population, as defined in subdivision (e) of Section 11005.3, of
all cities during the most recent fiscal year, divided by the actual
population, as defined in subdivision (e) of Section 11005.3, of
all cities in the 2004-05 fiscal year.
(B) The city's population determined in accordance with Section
11005.3.
(4) Fourth, to each city that was incorporated before August 5,
2004, in an amount equal to the product of the following two
amounts:
(A) The quotient derived from the following fraction:
(i) The numerator is the product of the following two amounts:
(1) Fifty dollars ($50) per year.
(ll) The fraction determined as the total amount of vehicle
license fee revenue collected during the most recent fiscal year
divided by the total amount of vehicle license fee revenue collected
during the 2004-05 fiscal year.
(ii) The denominator is the fraction determined as the actual
population, as defined in subdivision (e) of Section 11005.3, of
all cities during the most recent fiscal year, divided by the actual
population, as defined in subdivision (e) of Section 11005.3, of
all cities in the 2004-05 fiscal year.
(B) The actual population, as defined in subdivision (e) of
Section 11005.3, residing in areas annexed after August 5, 2004,
as of the date of annexation.
(5) Fifth, to the cities and cities and counties of this state in the
proportion that the population of each city or city and county bears
to the total population of all cities and cities and counties in this
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state, as determined by the Demographic Research Unit of the
Department of Finance. For the purpose of this subdivision, the
population of each city or city and county shall be determined in
accordance with Section 11005.3.
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