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2002 LEGISLATIVE PRIORITIES from page 1 · · · · · · · · · · · · · · · · · · · · · · · · · · · · This will be a difficult session, especially as it the ERAF growth at 10% per year for 10 years relates to the state budget process. The deficit is starting July 1, 2005. Position: Support. huge and it is real. Among Legislators and legisla- tive staff, the "tone" Is beginning to change on AB 680 (Steinberg). Land Use. Sales Tax the issue of local governments receiving cuts. and Property Tax P,evenue Allocation. AB 680 Many are now saying that local governments proposes to redistribute sales tax growth among should shoulder their share of the state deficit, cities and counties in the Sacramento region, Stay vigilantl including El Dorado, Placer, Sacramento, Sutter, Yolo and Yuba counties. The redistribution for- Revenue and Taxation mula would reallocate growth with one-third distributed on a situs basis, one-third on a popu- AB 1777 (Cardenas); SB 1261 (Peace). lation basis, and one-third on regional needs 2002-03 Budget. The escalating concern over related to housing and inflll targets. In addition, budget deficits in the current year (2001-02) and a regional impact fee was added to the bill to continuing revenue deterioration in the next fund a Sacramento Regional Open Space and budget cycle put local government revenues at Recreation Conservancy. The bill sets a dangerous risk in this year's state budget process. The precedent by allowing the state to assert its governor and many legislators have agreed not to control over the distribution of local Bradley- balance the budget on the backs of local govern- Burns sales taxes. Local sales tax could then ment. However, comments that all levels of become the same pawn to the state budget crisis government must share the burden in this budget as the ERAF property tax shift and the VLF back- crisis mean cities should remain on full alert fill. Position: Oppose. during the current budget deliberations. The Vehicle License Fee (VLF) backfill of $4 billion raises the greatest concern. The first challenge to Transportation, Public Works and l'ele- the governor's commitment to protect local communications revenues will come with the May Budget Revision. SB 1262 (Torlakson). Streets and High- Position: Oppose Any Cuts to City Govern- ways. Local Transportation Capital Improve- ment. ment Projects. This bill requires that not less than 10 percent of the local and regional State AB 1865 (Canciamilla); AB 2100 Transportation Improvement Program (STIP) (Simitian). Property Tax Shifts. Limitation. capital funds be used for transportation incentive Both bills limit the shift of property taxes to grants to cities and counties that promote hous- school districts under the Educational Revenue lng and development patterns with higher densi- Augmentation Funds (ERAF) provisions enacted in ties and greater proximity to jobs, schools and the early 1990%, AB 1865 incrementally caps the businesses. The bill establishes conditions and growth of ERAF by ?0% per year starting on or terms for awarding the grants, "grandfathers" any after July 1, 2004, Once the growth cap is fully existing equivalent grant program and makes the implemented, the ERAF share is allowed to in- provisions applicable in all counties with a popula- crease by an inflation factor. AB 2100 reduces tion over 200,000, The grant provisions would JOur Mission t~estore and protect local control for cities through education and advocacy to enhance the quali£y of life for all Californians. PAGE 2/PRIOP. ITY FOCUS Visit the League's Official Web Site--www. cacities.org