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VOTERS APPROVE LF. AGUE-SUPPORTED HOUSING AND SCHOOLS BALLOT MEASURES; SELECTIVE TREATMENT OF OTHER MEASURES Californians voted selectively on this election's crop of propositions. Especially important to cities, voters approved Proposition 46, a $2.1 billion housing bond. The League strongly supported Proposition 46 (see related article, page 1). Voters also approved several other propositions supported by the League. They include Proposi- tion 47, the $13.5 school bond, and Proposition 49, the measure to fund after school programs. Proposition 50, the $3.44 billion water bond initiative, also was approved. The League was neutral on Proposition 50. Voters disapproved the controversial Proposition 51, which would have funded various transportation related projects. The League opposed Proposition 51. Finally, voters disapproved Proposition 52, which would have enacted election day voter registration. The League was neutral on Proposition 52. Details about the ballot measures are available through the Secretary of State's websita (www.ss.ca.povl and the Legislative Analyst's website (www.lao.ca.govl. CA LEAGUE OF CITIES' PRESIDENT JOHN RUSSO MAKES CASE FOR REVALUING STATE'S TAX SYSTEM (Reprinted From the October 2002 edition oF Metro Investment Report, with permission From the publisher. ) Earlier this year, Asm. Darrell Steinberg's regional tax-sharing legislation, AB 680, died in the Legislature. At the fore of the lobby against the bill was the CaliforoJa League of Cities. Metro Investment Report is pleased to present this interview with John Russo, President of the California League of Cities and the City Attorney for the city of Oakland, in which he discusses the state/local Fiscal relationship and the League's response to AB 680. A number of critics of the League of Cities, including Assemblyman Darrell Steinberg, assert that the League is the least proactive and mOst unimaginative of the state's fiscal reform groups. They argue that the League must appeal to the most vocal and lowest common denominator of your member cities, thus limiting the options for reform that the League is able to support. How do you respond? That's a legitimate question. I think first and foremost, any road to reform has to start with some step in the direction of state-local fiscal reform. Largely, our concern is to stop the leaching of money and power away from local government to state government. We are facing, at this time, a very substantial set of cuts to local government, cuts that would be devastating. Our long-term and mid-term goal, as an organization, is for a revamping of California's tax system to a more sensible system-one that rewards cities that do well and make good decisions. We won't get there if we keep slipping backward. The current political dynamic in Sacramento provides absolutely no brake on the continued setting;aside of local revenues by the legislature to meet state political needs. Are you suggesting that if the League could successfully pass an initiative that would require voter approval before the state could take additional revenues from local government, it then would/could support true reform of the currently disfuctioeal state/local fiscal system? There's no question that we have to stabilize our local revenues first before we can set about the process of trying to reform the state of California's own budgetary problems. What would such a reform package include, if, by chance, the League were successful with an initiative to better protect local revenues from State appropriation? Continued on Page 4 Visit the League's Official Web Site--www.cacities.org PRIORITY FOCUS/PAGE 3