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<br />ðJ1- / <br /> <br /> <br />FOCUS <br /> <br />AnalysIs Cnl11menlary"ncl Ur)ciatF'~; c,n Le,]lsl;;j1tve <lnd Pcl '~Y 1;,sLles t"at Affect C:~llhr~la Cltl':'S <br /> <br />July 8, 2005 <br />Issue #27-2005 <br /> <br />LEAGUE APPLAUDS BUDGET AGREEMENT, <br />THANKS THE GOVERNOR AND LEGISLATIVE LEADERS <br /> <br />The League and local government officials received a very welcome surprise on <br />July 6, when Gov. Schwarzenegger and legislative leaders announced a budget <br />agreement that includes full funding ($1.3 million) of Proposition 42 transportation <br />projects, and full, early repayment ofthe $1.2 billion Vehicle License Fee (VLF) gap loan <br />taken from cities and counties by the state in 2003. For more, see Page 2. <br /> <br />......................... <br /> <br />THE FINE PRINT... <br /> <br />Here is a summary of the key items in the budget affecting California cities: <br /> <br />. VLF gap loan early repayment: $1.2 billion ($491.2 million to cities) <br /> <br />. <br /> <br />Prop. 42 - city portion of local streets and roads money ($254 million for both <br />cities and counties; cities get half of that - $126.5 million). Additionally, another $1 <br />billion in Prop. 42 funds will be allocated to state managed projects - many <br />benefiting our local communities. For more, see Page 3. <br /> <br />......................... <br /> <br />EARLY REPAYMENT OF VLF GAP LOAN: <br />A WELCOME SURPRISE FOR ALL CITIES <br /> <br />The announcement that the FY 2005-06 budget will include early, full repayment <br />of the "VLF Gap Loan" is good news for cities and counties who will now receive this <br />payment earlier than expected. The early repayment also benefits the state because it <br />liquidates a state debt and eases some of the stress that will be felt in next year's state <br />budget. For more, see Page 3. <br />