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11,A-1 January 10, 2003 Issue #11- 2003 jr ,,:� Aq issues thel oliea tolihn io Mtn BUDGET PROPOSES STATE BAIL -OUT WITH LOCAL GOVERNMENT FUNDS CUTS TARGET VLF BACKFILL, REDEVELOPMENT AGENCIES, BOOKING FEES Validating city officials' worst fears, Governor Gray Davis today released a budget proposal that reneges on the promise legislators and the governor made four years ago to protect cities and counties from a loss of Vehicle License Fee (VLF) funds caused by the state's 1998 decision to reduce annual vehicle registration fees paid by consumers. The proposal is to eliminate $1.3 billion of the remaining 02-03 fiscal year VLF backfill payments, and eliminate $2.9 billion of the VLF backfill payments estimated for 2003 -04. This proposal eliminates all of the VLF backfill going to cities, leaving funding only from the remaining VLF base. For more, see page 3. ....................... THE VEHICLE LICENSE FEE BACKFILL• SOME BACKGROUND In 1998 Governor Pete Wilson signed a bill "offsetting" the amount of VLF payments owed by car owners by 25 %, to an effective new tax rate of 1.5% of the value of the vehicle. The proposal provided for deeper cuts in future years (on the scale of 35 %, 46.5 %, 55% and 67.5 %) depending on the ad- equacy of state general fund revenues. Over the years, the offset has been increased to 67.5 percent. As part of the 1998 legislation, the state was required, by statute, to make up for the 67.5% loss of local revenues which reflects the difference between the fee assessed on the value of the car (100 %) and the actual fee paid by car owners (32.5 %). This money paid to local governments from the state general fund is the "back- fill ". For more, see page 5. ....................... LEAGUE WEBSITE REVAMP OFFERS NEW "ISSUES & ADVOCACY" CENTER Just in time for the start of the 2003 -04 legislative session, the League unveiled some website changes aimed at consolidating and providing easier access to critical information on issues, policy and legislation. The site changes were designed with the help of a small focus group that included some League members, a grassroots regional representative, and a few staff representatives. We developed some priorities guiding us in our re- design of a new Issues and Advocacy section of our site. Some of the primary goals initially recognized were to streamline the navigation, provide easy access to Legislative information, and prioritize the issue information provided by the League. For more, see page 5. Page 2 • EPA's Brownfields lob Training Grant Program " Learn About Emergency Volunteerism Grant Opportunities Page 6 " Development Report Card of the States