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Home My WebLink AboutMINUTES - 01141997 - C31 TO: BOARD OF SUPERVISORS Contra FROM: PHIL BATCHELOR, COUNTY ADMINISTRATOR -` s Costa x, = County Y. DATE: January 6, 1997 SUBJECT: LEGISLATION: ACA 4 (AGUTAR) - FREEZE OF THE PROPERTY TAX TRANSFER AND ITS GRADUAL RETURN TO LOCAL GOVERNMENTS SPECIFIC REQUEST(S)OR RECOMMENDATION(S)&BACKGROUND AND JUSTIFICATION RECOMMENDATION: ADOPT a position in SUPPORT of Assembly Constitutional Amendment 4 (ACA 4) by Assemblyman Fred Aguiar which would freeze the amount of the property tax transfer to the State and gradually return it to those local governments from whom it was taken. BACKGROUND: The Board of Supervisors has vigorously opposed the transfer of millions of property tax dollars from the County, cities, and special districts to the State beginning in the 1992=93 fiscal year and continuing to the present. Assemblyman Fred Aguiar has introduced ACA 4 which, as introduced, would do all of the following: 1.. Effective for the 1998-99 fiscal year and all subsequent fiscal years, freeze the amount of the transfer at the 1996-97 fiscal year level. 2. Effective with the 1998-99 fiscal year, reduce the amount of the reduction and transfer of the property tax by an as yet unspecified schedule, with the reduced transfer being allocated back to local taxing jurisdictions in proportion to the amounts which would otherwise have to be transferred to the State by each jurisdiction. CONTINUED ON ATTACHMENT: YES SIGNATURE: RECOMMENDATION OF COUNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE APPROVE OTHER SIGNATURE(S): 4fl� zz& ACTION OF BOARD ON jan„anr 1 A 1007 APPROVED AS RECOMMENDED OTHER VOTE OF SUPERVISORS I HEREBY CERTIFY THAT THIS IS A TRUE UNANIMOUS(ABSENT ) AND CORRECT COPY OF AN ACTION TAKEN AYES: NOES: AND ENTERED ON THE MINUTES OF THE BOARD ABSENT: ABSTAIN: OF SUPERVISORS ON THE DATE SHOWN. ATTESTED /� 1997 Contact: Py BATCHELOR,CLE OF THE BOARD OF CC: SUPERVISORS AND COUNTY ADMINISTRATOR See Page 2 BY DEPUTY C Placing these provisions in the State Constitution has the advantage of making it more difficult for the Legislature to again transfer property tax revenue from local governments or to increase the amounts already being transferred. Support of ACA 4 appears to be consistent with the Board's previous positions on this subject and we would, therefore recommend that the Board indicate its support for ACA 4. cc: County Administrator Auditor-Controller County Counsel Tony Enea, CAO's Office Les Spahnn Heim, Noack, Kelly & Spahnn 1121 L Street, Suite 100 Sacramento, CA 95814 Casey Sparks, Executive Director Urban Counties Caucus 1100 K Street, Suite 101 Sacramento, CA 95814 -2- CALIFORNIA LEGISLATURE-1997-98 REGULAR SESSION Assembly Constitutional Amendment No. 4 f 5>. { Introduced by Assembly Member Aguiar December, 2, 1996 Assembly Constitutional Amendment No. 4—A resolution to propose to the people of the State of California an amendment to the Constitution of the State, by adding Section 1.5 to Article XIII A thereof, 'relating to local t . government finance. LEGISLATIVE COUNSEL'S DIGEST ACA 4, as introduced, Aguiar. Local government finance: property tax revenue allocation: local agency relief. Existing provisions of the California Constitution provide that the revenues derived from the general ad valorem property tax are to be allocated to the jurisdictions in each county in accordance with law. Existing statutory law implementing these provisions requires the county auditor,ins.. each fiscal year, to allocate property tax revenues to local ' jurisdictions in accordance with specified formulas and procedures, and generally provides that each jurisdiction shall be allocated an amount equal to the total of the amount of revenue allocated to that jurisdiction in the prior fiscal year,, subject to certain modifications, and that jurisdiction's portion°'` of the annual tax increment, as defined. Existing statutory law" modifies these general allocation provisions by requiring, for purposes of determining property tax revenue allocations in each county for the 1992-93 and 1993-94 fiscal years, that the amounts of property tax revenue deemed allocated in the 99 1 ACA 4 — 2 — prior 2 — prior fiscal year to the county, cities, and special districts be f reduced in accordance with certain formulas. It requires that the revenues not allocated to the county, cities, and special districts as a result of these reductions be transferred to the Educational Revenue Augmentation Fund in that county for allocation to school districts, community college districts, and the county office of education. d This measure would modify these reduction and transfer requirements, for the 1998-99 fiscal year and each fiscal year thereafter, by prohibiting the total amount allocated to a county's Educational Revenue Augmentation Fund pursuant to those requirements from exceeding the total amount allocated to that fund for the 1996-97 fiscal year. This bill would also require, commencing with the 1998-99 fiscal year, that each reduction and transfer amount calculated for a local agency in a county.be annually reduced in accordance with an unspecified schedule, and that the revenues not allocated to the county's Educational Revenue Augmentation Fund as a result of these reductions be instead allocated among the local agencies in the county, as provided. Vote: 2/3. Appropriation: no. Fiscal committee: yes. State-mandated local program: no. 1 Resolved by the Assembly, the Senate concurring,.That 2 the Legislature of the State of California at its 1997-98 Aft 3 Regular Session commencing on the second day of 4 December, 1996, two-thirds of the membership of each 5 house concurring, hereby proposes to the people of the 6 State of California that the Constitution of the State be 7 amended by adding Section 1.5 to Article XIII A thereof, 8 to read: 9 SEC. 1.5. (a) Notwithstanding any other provision 10 of law, for purposes of implementing the ad valorem `A 11 property tax revenue allocation requirements of ; 12 subdivision (a) of Section 1 in the 1998-99 fiscal year and 13 in each fiscal year thereafter, both of the following y. 14 requirements shall apply: 15 (1) No county's Educational Revenue Augmentation 16 Fund established pursuant to Section 97.2 and 97.3 of the , 17 Revenue and Taxation Code, or an successor to those � Y 99 -3 — ACA 4 j ` 1 sections, shall be allocated a total amount of ad valorem 2 property tax revenue that exceeds the total amount of ad 3 valorem property tax revenue that was allocated to that 4 fund in the 1996-97 fiscal year. 5 (2) (A) A county's Educational Revenue 6 Augmentation Fund shall be allocated only that 7 percentage specified in subparagraph (B) of each 8 amount of ad valorem property tax revenue that is -{ 9 required to be allocated to that fund rather than a local 10 agency as a result of the total reductions calculated for 11 that local agency pursuant to Sections 97.2 and 97.3 of the 12 Revenue and Taxation Code, or any successor to those 13 sections. 14 (B) For purposes of subparagraph (A), the allocation 15 percentages are as follows: 16 17 Fiscal Year Percentage (%) 18 1998-99 19 and each fiscal year thereafter 0 Chl 20 kJ j21 (b) In the 1998-99 fiscal year and each fiscal year 22 thereafter, any amount of ad valorem property tax 23 revenue that is not allocated to a county's Educational 24 Revenue Augmentation Fund as a result of any limit or 0 a 25 reduction established in subdivision (a) shall instead be 26 allocated among . the local agencies in the county in 27 accordance with each local agency's proportionate share 28 of the total amount of ad valorem property tax revenues 29 that would be required to be allocated to the county's 30 Educational Revenue Augmentation Fund in the absence 31 of this section. 99