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9.A -3 CONTROLLER DELAYS PORTION OF VLF BACKFILL PAYMENTS The League and the California State Association of Counties (CSAC) were notified by State Controller Steve Westly this waek that vehicle license fee (VLF) backfill payments to cities and counties for the last 10 days of June would be delayed until the end of July. Wel letter cited the recent lawsuit filed against the pulling of the VLF "trigger", as well as ongoing budget discussions, as reasons for his decision to postpone a portion of the backfill pay- ments distributed in July until the end of the month. The delay means that the VLF payments for June, distributed to cities and counties on July 10, will not include 100% of the June VLF backfill. Instead, they exclude the VLF backfill payment for the period after the "trigger" was pulled (June 20 — 30. They will contain 100% of the direct VLF payments, and the backfill due for June 1 -19. SB 44 ffm page ••••••••••••••• .. .. _., If • >. .,.,. . .. ' • . . jit If a l 5 oz a I _00, 1.� nN I !A111l via, •__. .• . • By law, the VLF payments are required to be made monthly — without specific reference to a date. The State Controller has reiterated his commit- ment to make the payment on the June 20 — 30 portion of the backfill before the end of July, and to ensure that the payments are July receivables (unless there is legislative action that would require him to do otherwise). The League notified city officials immediately upon receiving the Controller's message. We remain opposed to any efforts by the legislature and the Administration to raid the backfill monies during the "gap" between the time the "bigger" was pulled, and the time the fees are paid at the higher amount. Estimates of the gap losses to local government are in the range of $852 million. This would be a devas- tating blow to local governments and our ability to provide critical services. The League appreciates the effort the State Controllers office has made to work with us through- out the debate on the "gap ", and his commitment to pay the full backfill amount in absence of legislative action directing him otherwise. A report of the early July allocation amount is available on the State Controller's website at www.sco.ca.gov. As was the case with SIB 402, SIB 440 only seeks to impose binding arbitration on local govemmel the state would once again be exempt from the provisions of the bill. Next Stop: Assembly Floor _. . . - Ali :., Ui •.- • .. I, 17W 1177 11' .. .. - v, . - through is considering numerous options to balance its budget in part local funding. For anyone who preserving cares about outra Visit the League's Official Web Site -- www.cacities.org PRIORITY FOCUS/PAGE 3