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U -1s KEY BILLS from page 2 • Under this proposal, presumably a city that is experiencing a higher amount of property tax growth than sales tax growth would get greater revenues *an what the triple -flip currently offers — a dollar- for - dollar replacement of sales tax with property taxes. The funding source for this mea- sure would come from draining funds away from enterprise special districts. It also required that the city or county that wanted to take advantage of this provision first have an approved housing element. A number of cities were very concerned that this measure may set a bad precedent for future legisla- tion, making this triple -flip or variations on the triple - flip permanent. After many ups and downs, this measure was defeated soundly. Local Sales Tax Authority ( 566 — Scott). One of the session highlights was the passage of SB 566 which gives all cities the authority to ask local voters to raise local sales taxes and raises the previous sales tax cap for each county from 1 and cent to 2 cents. Currently, there are a handful of cities that have secured special legislation to permit the enactment of a local sales tax in the city. If signed by the Governor, this legislation would now give that authority to all cities. The authority is, of course, subject to all Propositions 218 and 13 requirements. Cities were instrumental in ensuring that this legislation applied to all cities in California. Initially, the legislation applied only to those cities whose legislators added themselves as co- sponsors of the bill Opposition by their legislator would have excluded a city from participating in this option. Thanks in large part to the persistence of cities themselves, the author was asked by leadership to change the legislation to apply universally, to all California cities. disability benefits are not taxable. Local agencies' experience is that this law has worked to prolong recoveries, and prevented the agencies from fillino critical positions left open by officers on this 1 -year disability leave. Early last week AB 1362 (Wiggins) was amended to extend this 1 -year benefit to 2 years. This measure was defeated in the Senate. A number of fire chiefs, police chiefs, finance direc- tors, human resources directors and other city officials attending the Annual Conference lobbied heavily to defeat the measure. Workers' Compensation. Perhaps the key focus of the Legislature during the final month of the legislative session was the development of a package to cut the soaring costs of workers' com- pensation coverage to both private and public sector employers. Work in the last week of the session focused on reducing medical treatment costs through fee caps and service reductions. This measure has been sent to the Governor and he is expected to sign the legislation. Universal Employer Health Care Coverage. Coupled politically with the workers' compensation package is this proposal to provide "universal health care coverage" by requiring employers to provide health care benefits for employees. The measure applies to all large employers (defined as employers with 200 or more employees) on January 1, 2006; and, medium employers (defined as employers with 20 to 199 employees) on January 1, 2007. Medium employers with 20 to 49 employees will be given an exemption, unless a specified tax credit for those employers is passed before that date. Employers with less than 20 employees would not be covered by the requirements of SB 2. Cities are encouraged to convey their support to the Governor to sign this legislation. Employee Relations/Workers' Compensation Public Safety Officer Disability (4850 Time). Under current law, local public safety officers can receive up to 1 year of full pay in lieu of temporary disability benefits if they are temporarily injured on the job. This actually results in the officers receiving more money off than on the fob, because the For cities, the primary impact may be on part- time employees who are not now covered by a health insurance plan. We understand that the intent is to narrow the application of the legislation to only those employees who are truly without any insurance coverage. This would be accomplished through the adoption of regulations. For strategic reasons, the League chose to focus most of its efforts on the workers' compensa- tion package, and to devote less effort to SB 2. Continued on Page 4 Visit the League's Official Web Site-- www.cacities.org PRIORITY FOCUS /PAGE'S .... ...............................