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I.A -15 HOUSE COMMITTEE ACTS TO PROTECT -- FUNDING FOR OLDER AMERICANS FROM STATE BUDGET GRIDLOCK During last year's state budget stalemate, the state failed to disburse federal funding to support a number of programs that function at the local level, and Older Americans Act dollars were among those tied up in the budget impasse. Local Area Agencies on Aging receive federal funding through the Older Americans Act to assist them in provid- ing social and nutritional supportive services to some of our nation's most vulnerable citizens. State inaction forced many of these financially strained local entities to continue providing the same Older Americans Act services, but in the absence of the federal dollars they should have received to offset the financial burdens associated with the programs. To end this practice, Representative Gary Miller (Diamond Bar), along with several of his House colleagues, worked to include language in the House Appropriations Committee's recently approved FY 2004 Labor -HHS- Education Appro- priations bill report that would direct the state to not withhold Older Americans Act funding if a state fails to pass its own annual budget in a timely fashion. Similar language, however, is not included in the Senate Appropriations Committee report accompanying its version of the Labor -HHS- Education Appropriations bill. The full House and Senate are expected to consider the bills on the floor when Congress returns from its 4t' of July recess. Then the two houses will meet to reconcile differences between their respective versions of the bill. The League remains hopeful that the language advanced by Representative Miller will be a part of the final agreement. HIGHWAY USERS TAX MONIES TO BE DELAYED The state has started yet another fiscal year without an approved budget. Recently, State Controller Steve Westly outlined what steps he'd take to manage cash Flow given the lack of a budget. The good news – the VLF backfill pay- ments are on the list of payments that will continue without a budget (barring any other legislative intervention). . Westly indicates that the only payments to local governments that will be delayed would be reim- bursement for state funded mandates (which were deferred in 2002 -03 anyway), and the monthly Highway Users Tax distributions. The Highway Users Tax disbursements average about $48 million per month to cities statewide, with the next regular payment scheduled to be made July 30. Payments will be delayed until a budget is in place at which time they will "catch" up on any missed payments to local governments. BINDING ARBITRATION: IT'S BACK! On Wednesday, July 2, SB 440 (Burton) underwent a "gut and amend ", becoming the latest attempt to impose costly binding arbitration procedures on cash- strapped California cities and counties. The bill is set for hearing next Wednes- day, July 9, in the Assembly Committee on Public Employees, Retirement and Social Security. In addition to Senator Burton and the principal co- author, Assembly Member Wiggins, the follow- ing legislators have signed on as co-authors: Senators Ducheny, Perata, Romero and Soto; Assembly Members: Cohn, Diaz, Hancock, Koretz, Leno, Longville, Maddox, Maldonado, Samuelian and Strickland. For several weeks the League had heard rumors that the public safety unions were planning to introduce legislation in response to the Califor- nia Supreme Court's April 21, 2003 ruling that SB 402 –the unions' 2000 legislation on binding arbitration — was unconstitutional. SB 402 gave local firefighters or law enforce- ment officers the right to invoke binding arbitration if their representatives are unable to reach agree- Continued on Page 10 Visit the League's Official Web Site -- www.cacities.org PRIORITY FOCUS /PAGE 3