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�� i� PROP. 42 from page 1 ............. FEDERAL TELECOM from page 1...... Background. Since its enactment, with the The "BITS" legislation would establish a new exception of the current fiscal year, the disappointing regulatory framework for a range of telecommuni- history of the Prop. 42 program has been one of the �tions-related technologies, including the delivery state using its authority to suspend the program each of video over the Internet. year and then taking the money to help reduce gen- eral fund deficits. During the first years of the Prop. 42 The (etter articulates key principles that the program, local govemments were loaned money from League argues should be included in future drafts the State Transportation Improvement Program (STIP) to cover two years of local street maintenance costs on telecommunications reform to protect California under the program. Local governments received this cities' ability to protect public rights-of-way and Prop. 42 "in-lieu" money while the money for state provide basic services to residents and busi- projects was suspended, again to reduce state gen- nesses. The League also expressed its willing- eral fund deficits. ness to work with the committee as future drafts are released. In order to receive these initial funds, local govem- ments were required to pay back the STIP in fiscal In September 2005, the House Commerce years 2006-07 and 2007-08 by foregoing any Prop. committee staff released a bi-partisan staff draft 42 revenues. Consequently, under current law, cities bill. The League and national stakeholders did not and counties will not receive additional Prop. 42 funds feel that the first draft was ideal, but through the until FY 2008-09, when cities are expected to receive congressional representation, the League contin- $280 million, based on expected gas tax revenues of ued to work with staff to ensure that have local $1.4 million. That feaves a gap of between $254-280 concerns met. million (based on the gas tax revenues) for the each of the neut two yea�s. In early November, however the committee Where We Are Today. Because the state's fiscal released the latest draft, which was a significant situation has improved significantly, and the govemor revision of prior versions of the bill. The League and his staff are busy preparing the 2006 state and other national organizations expressed great budget, now is the ideal time to urge the govemor to concern over provisions that would limit video propose a budget that "fills the gap" in Prop. 42 franchise fees to 5 percent of subscriber revenue funding af local streets and roads. instead of 5 percent of gross revenues, and limit � local governments' ability to enforce public safety. With a$13 billion backlog in road and bridge Congressman Barton had authored the previous rehabilitation projects, city and counry streets and �o drafts. roads desperately need this transportation money to maintain the public's investment in the transportation A full copy of the League's letter to Congress- system. If these streets and roads are allowed to man Barton can be found on the League website further deteriorate, the reconstruction of the road is at www.cacities.ora. vastly more expensive than the cost of routine maint� nance. Key Principles for Reform. The following are some of the principles that the League believes The League urges ciry officials to write the gover- must be considered as part of reform: nor, asking him to "fill the gap" in Prop. 42 funding. Tell him about the projects in your city that will be • Preserving Valuable City Services - It is stalled if the Prop. 42 funding gap is not filled. Also, essential that California cities retain current rev- please send copies of your letter to your legislators, so enue sources in any federal telecommunications they are aware of your request to the govemor. reform legislation in order to maintain basic ser- A sample letter is available for download on the vices to our residents. League's website at www.cacities.ora. • Maintaining Municipalities' Authority in Continued on Page 9 PAGE 8- PRIORITY FOCUS Visit the League's Official Website--www.cacities.org December 2, 2005 - Issue �46