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The Senate Bud'ge{ and Fiscal Review Committee version approved the Subcommittee recommenda- Budget Updates On League Web site tions with changes that result in $1 billion more Want to know what's going on with the state expenditures than are contained in the Governor's budget? Check the League's "Budget Update" on May Revision ($379M in additional program expen- our Web site at (cacities.org/budgetupdate), or ditures, combined with a $600M accounting error by clicking on "State Budget Alert" in the Prior- made in the May revision), The higher appropria- ity issues section on the Web site's Home Page, tions are directed primarily to the health and welfare AS the Budget Conference Committee or other programs that took a heavy hit in the May Revision, legislative action occurs on budget issues of and should be seen as reflecting the Senate's "bot- interest to cities, we will provide updates (noted tom line". If the Senate holds to this higher appro- priation level, the Conference Committee must make by their date) -- so be sure to check back $1 billion in cuts elsewhere or increase revenues to regularly. If you have any specific questions or balance the budget, creating pressures on other concerns about the budget, contact Jean Korinke areas of the budget. (jkorinke@cacities.org; 916-658-8245). The possibility of additional budget cuts came up again at week's end, when Republicans in both . t,L£S TAX from page 1 · · · · · · · · · · · · houses refused to provide the two-thirds votes needed to pass the budget bill to Conference. The The amendment was approved over the objection Assembly Democratic majority adopted procedural of the League, individual cities, and CSAC, As amendments to the bills in order to pass their approved, the amended regulation would provide budget bill on a simple majority vote. In the Senate, that 50 percent of the lump-sum charge for an however, the bill was passed with two Republican optional software maintenance agreement is for the votes -- but only after a Republican amendment was sale of tangible personal property and subject to tax taken to include Control Language specifying that an with the remaining 50 percent identified as nontax- additional $4.5 billion in cuts would be taken in the able charges for repair, Under current provisions of Budget Conference Committee. This amendment will Regulation 1502, the entire lump-sum charge for an constitute yet another conference item. While it is optional software maintenance agreement is subject unlikely that the Committee will adopt this approach, to tax, including it on the conference agenda is bound to The Board of Equalization staff analysis projects generate intense discussion during the Committee that the changes would cost local governments deliberations, between $5 - 8 million annually. As originally proposed, the amendments would also have been Conference Committee is expected to start early retroactive allowing for refund requests to be next week. The Committee membership is be: submitted for sales taxes incurred up to 3 years ago, Assembly: Jenny Oropeza (D-Long Beach), Darrell The League contended that the retroactive nature Steinberg (D-Sacramento) and John Campbell (R- would have a significant impact on city revenues, Orange County/Irvine). Senate: Steve Peace (D-San and asked for it to be a prospective ruling. The BOE Diego/El Cajon), Dick Ackerman (R-Orange County/ accepted our proposal resulting in the January 1, Irvine) and or Wes Chesbro (D-North Coast/Arcata). 2003 effectwe date being applied. Our Mission Restore and prorect local control for citie.~ through education and advocacy to enhance the qu~liry of life for all Californians. PAGE 2/PRIORITY FOCUS Visit the League's Official Web $ite--www. cacities.org