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California State Association of Counties

CSAC Bulletin Article

Government Finance and Operations

April 25, 2014 Jean Kinney Hurst Geoffrey Neill

Taxes

AB 2231 (Gordon) – Support
As Amended on April 21, 2014

AB 2231, by Assembly Member Rich Gordon, would restore the Senior Citizens’ Property Tax Postponement Program that was eliminated in the February 2009 budget agreement. 

The Senior Citizen’s Property Tax Postponement Program offered income-eligible seniors and the disabled the opportunity to postpone their property tax payments in exchange for full repayment with interest when their home is sold. Unfortunately, in large part due to the recent recession and housing crisis, the program failed to pay for itself in 2007-08 and 2008-09, making it a target for elimination given the state’s budget crisis at the time.

Subsequent efforts to restore the program resulted in the passage of AB 1090 (Blumenfield) in 2011, a bill that authorized counties to opt to provide the program using local funds. Counties, however, were not authorized to place a priority lien on the property to ensure repayment of deferred property taxes. Without priority lien status, counties are limited in their ability to finance such a program, given their fiduciary responsibilities to taxpayers and other local agencies.

AB 2231 reestablishes the Senior Citizen’s Property Tax Postponement Program at the state level with important modifications to ensure that the state’s General Fund is protected during economic downturns, and keeping the program up and running when these residents need it most.

The Assembly Revenue and Taxation Committee will consider AB 2231 at its hearing next Monday, April 28.

AB 2109 (Daly) – Concerns
As Amended on March 24, 2014

AB 2109, by Assembly Member Tom Daly, would require the Board of Equalization to annually report information related to locally-assessed parcel taxes, including the type and rate of tax, the number of parcels subject to and exempt from tax, the sunset date of the tax, and the revenue generated from the tax. This information would be provided to the Board of Equalization by the county auditor.

CSAC has communicated its fiscal concerns about AB 2109 to the author, who has committed to working with us to minimize costs.

The Assembly Revenue and Taxation Committee rescheduled AB 2109 from April 21 to this coming Monday, April 28. The Assembly Local Government Committee previously passed AB 2109 on April 2.

AB 1717 (Perea) – Support in Concept
As Amended on April 2, 2014

AB 1717, by Assembly Member Henry Perea, would implement a retail-level system for collecting state and local charges on prepaid wireless services. For counties, this bill affects utility user taxes.

Currently, utility user taxes, as well as a host of state charges such as 9-1-1 fees, are not collected from consumers of prepaid wireless customers. Some of the state charges are being paid by wireless carriers themselves. AB 1717 would implement a system for retailers to collect these charges and remit them to the Board of Equalization.

The Legislature passed a very similar version of this bill last year, but the Governor vetoed it despite expressing support for its purposes and for establishing a mechanism to collect the local charges.

The Assembly Utilities and Commerce Committee passed AB 1717 on a bipartisan 9-0 vote with six abstentions at its meeting on Monday, April 21. The bill now moves to the Assembly Revenue and Taxation Committee.

Elections

AB 1861 (Harkey) – Support
As Introduced on February 19, 2014

AB 1861, by Assembly Member Diane Harkey, would fund the Voter Identification Procedures mandate in the current budget year.

The Voter Identification Procedures mandate requires county election officials to “compare the signature on each provisional ballot envelope with the signature on the voter’s affidavit of registration.” The mandate is currently suspended, which means that county election officials may, under the law as it currently stands, count a provisional ballot without first checking the signature on the envelope.

Given that the purpose of provisional ballots is to give the opportunity to vote to people whose identity cannot be immediately determined, the fact that the law doesn’t require their identity to be determined before counting the ballot is absurd.

This suspension is part of a historic defunding of elections that the state of California has committed over the past few years. The defunding includes several mandate suspensions, including this one, that threaten not only the integrity of our elections, but also equal access to the ballot (the permanent absent voter mandates are also suspended). The state has also stopped reimbursing the costs of legislative vacancy elections over the past few years.

These actions taken together have resulted in the state defunding elections to the tune of about $40 million per year.

Also at stake for this bill in particular is the issue of fairness. Counties fulfilled this mandate for years on the explicit promise that once the costs were known and were determined through a quasi-judicial process to be a reimbursable mandate, a system that is tilted strongly against local agencies by design, the state would pay for those services. In the case of this mandate, as soon as the bill came due, the state reneged on that promise by suspending the mandate, and has therefore never paid a penny of its obligation.

The Senate Budget Subcommittee No. 6 will consider AB 1861 at its hearing next Monday, April 28.

SB 1062 (Block) – Support If Amended
As Amended on March 24, 2014

SB 1062, by Senator Marty Block, would require counties to prepay postage for all vote-by-mail ballots. As currently written, it would impose a mandate on counties on the order of $5 million to $7.5 million for a single general election.

CSAC supports efforts to increase voter participation, but we believe it is inappropriate for the state to decide how counties should spend their money. If the state wants every voter to be able to return the mail ballot without a stamp, they should require the Secretary of State’s office to use their Business Reply Mail account for this purpose, thus requiring no reimbursement.

The author’s office has been in touch with CSAC about making this change to the bill.

The Senate Elections and Constitutional Amendments Committee passed SB 1062 at its hearing on Tuesday, April 22. The bill now moves to the Senate Appropriations Committee, where it is scheduled to be heard on May 5.

AB 2338 (Wagner) – Oppose
As Introduced on February 21, 2014

AB 2338, by Assembly Member Donald Wagner, would place limitations on pre-election challenges for local initiatives. CSAC asserts that it is wholly appropriate for local governments to file declaratory relief actions when initiatives clearly violate state or federal law. 

Pre-election declaratory relief serves an important public purpose by allowing local agencies to seek judicial review of an initiative ordinance before incurring the expense of an election to consider a potentially invalid law. The courts have determined that a pre-election challenge is appropriate (under a more demanding standard of judicial review) when an initiative is facially illegal. The California Court of Appeals lays out a compelling argument for pre-election challenges:

“On the question of whether it is appropriate for a court to address a preelection challenge of a proposed initiative, we observed that ‘if an initiative ordinance is invalid, no purpose is served by submitting it to the voters. The costs of an election – and of preparing the ballot materials necessary for each measure – are far from insignificant.’

“Proponents and opponents of a measure may both expend large sums of money during the election campaign. Frequently, the heated rhetoric of an election campaign may open permanent rifts in a community. That the people’s right to directly legislate through the initiative process is to be respected and cherished does not require the useless expenditure of money and creation of emotional community divisions concerning a measure which is for any reason legally invalid.” (City of Riverside v. Stansbury (2007))

The initiative power is not absolute. The California Constitution and case law clearly place restrictions on the initiative power. A local initiative may not conflict with state legislation, may not impair contracts, may not impair essential governmental functions, may not violate individual rights protected by the state and federal Constitutions, and the list goes on. AB 2338 seeks to place any measure, regardless of its validity, before the electorate and incur the political, social, and financial expenses associated with a post-election challenge. We respectfully disagree with this approach.

The Assembly Judiciary Committee will consider AB 2338 at its hearing next Tuesday, April 29.

Library Bond

SB 1455 (DeSaulnier) – Support
As Amended on April 9, 2014

SB 1455, by Senator Mark DeSaulnier, would give voters the choice of enacting a new library construction and renovation bond.

As the internet age began, many predicted the slow death of libraries. Much to our delight, exactly the opposite has occurred and there is a greater demand for libraries per capita than there has been in decades. Through a combination of forward thinking and circumstance, libraries have become a hub of community activity.

Libraries today serve as some residents’ only access to the high-speed internet connections that have become so critical to today’s students, entrepreneurs, artists, researchers, and job seekers. They serve as a critical “third space” for groups of like-minded and open-minded residents to gather and learn. They also still let people read books for free, which is an important service that sometimes gets taken for granted.

Given the statewide benefits libraries serve, we believe it is appropriate for voters statewide to consider a general obligation bond.

The Senate Governance and Finance Committee will consider SB 1455 at its hearing next Wednesday, April 30.

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April 25, 2014 Jean Kinney Hurst Geoffrey Neill

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Vanir Construction Management, Inc.

February 13, 2014 Bob Fletcher, Vice President of Business Development
4540 Duckhorn Drive, Suite 300
Sacramento, CA 95834
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(916) 997-3195
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Western States Petroleum Association

March 13, 2017 Catherine Reheis-Boyd, President
1415 L St., Suite 600
Sacramento, CA 95816
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(916) 444-7750  
creheis[remove-this-and-replace-with-at]wspa.org
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August 30, 2012

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October 22, 2012
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