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California State Association of Counties

CSAC Bulletin Article

Government Finance and Operations update 9/2/2014

September 2, 2014 Jean Kinney Hurst Geoffrey Neill

Redevelopment

SB 1129 (Steinberg) – Oppose

CSAC has had a long-standing oppose position on SB 1129, Senator Darrell Steinberg’s measure that seeks to make changes to three components of the dissolution process: enforceable obligations, long range property management plans and compensation agreements, and use of bond proceeds for debt issued in 2011. Recent amendments to the bill include new deadlines for the State Controller’s Office to complete audits of asset transfers by former redevelopment agencies, as well as audits of asset transfers by successor agencies. Because each of these directly affects the allocation of property tax revenues and we know that the allocation of property tax revenues is a zero-sum game, SB 1129 will have fiscal consequences for affected taxing entities, including counties.

SB 1129 was approved by the Legislature last week and now goes to the Governor for his consideration.

AB 2493 (Bloom) – Oppose

CSAC also opposes AB 2493, Assembly Member Bloom’s measure that would authorize successor agencies of dissolved redevelopment agencies to use and commit bond proceeds for those bonds issued between January 1, 2011 and June 28, 3011 for certain types of projects. Since use of these bond proceeds directly affects the allocation of property tax revenues and since the allocation of property tax revenues is a zero-sum game, CSAC believes AB 2493 will have fiscal consequences for affected taxing entities, including counties.

The Legislature approved AB 2493 last week and sent it to the Governor for his consideration.

Infrastructure Financing Districts

SB 628 (Beall) – Support

SB 628 by Senator Jim Beall was amended late in the session to provide for a new economic development tool, Enhanced Infrastructure Financing Districts (EIFDs). Counties will recall that the Governor had proposed the concept of EIFDs in his January budget proposal and May Revision, building on the existing infrastructure financing statutes. IFDs, like redevelopment agencies (RDAs), are economic development financing mechanisms that rely on tax increment financing. Unlike redevelopment, they cannot utilize schools’ property tax shares and require the consent of any other taxing entities before their property taxes can be diverted. An IFD can therefore use the tax increment of only some—or even one—of the local taxing entities.

The proposed EIFDs are available to finance transit priority projects, infill, affordable housing, military base reuse, and environmental mitigation. While the proposed bill does not include a voter requirement for formation of the EIFD, if the EIFD issues bonds, voters within the district must approve by at least 55%.

SB 628 was approved by the Senate and Assembly last week and will soon become eligible for the Governor’s consideration.

Elections

AB 1873 (Gonzalez) – Support

AB 1873, by Assembly Member Lorena Gonzalez, would authorize San Diego County to conduct a special vacancy election entirely by mail as a pilot project. This common-sense approach provides an opportunity to improve voter participation and save money.

Special elections are costly, especially when they cannot be consolidated with other elections. In Los Angeles County alone, special elections have cost more than $27 million since 2008. County election officials conduct these elections in the same way as other statewide elections, with the parallel process of polling places and poll workers run alongside the increasingly popular mail ballots. Costs associated with special elections are usually unanticipated and unbudgeted, creating a fiscal pressure on election departments and the county generally.

The Assembly passed AB 1873 47-29 last Thursday. The Senate approved the bill 28-8 earlier that day. The bill now goes to the Governor for his consideration.

SB 29 (Correa) – No Position

SB 29, by Assembly Member Lou Correa, would require election officials to count ballots that they receive within three days after the election if they are postmarked on or before Election Day. If the postmark is missing or illegible, counties would have to count the ballots if the signature is dated on or before Election Day. The bill would also give election officials a little more flexibility in canvasing the vote and processing vote-by-mail ballots.

The Senate passed SB 29 on a 21-11 vote last Tuesday after the Assembly passed it 54-25 the previous day.

Taxes

SB 69 (Roth) – Support

Senate Bill 69 by Senator Richard Roth would provide a “Vehicle License Fee Adjustment Amount” for those newly incorporated cities that were impacted by SB 89 (2011). CSAC supports this measure, as it would provide immediate financial assistance to the four newly incorporated cities in Riverside County.

Counties will recall that the state’s four newest cities planned for and, in some cases received, additional VLF revenues to help finance their starts. When SB 89 redirected all VLF revenues to fund certain public safety programs under 2011 realignment, these four cities lost considerable portions of their budgets. SB 69 seeks to assist these cities financially by providing an additional “VLF Swap” amount.

SB 69 was approved by the Legislature last week and is now with the Governor for his consideration.

AB 1717 (Perea) – Support

AB 1717, by Assembly Member Henry Perea, would implement a system for collecting state and local charges, including utility user taxes, on prepaid wireless purchases. These transactions have historically escaped collection because, unlike wireline and post-paid services, the service provider is not always aware of the consumer’s location.

The Assembly passed AB 1717 70-5 last Wednesday, following the Senate’s 29-2 vote the previous day. The Governor vetoed a similar bill last year, but this year’s version mitigates some of the concerns he expressed in his veto message.

AB 2170 (Mullin) – Support

AB 2170, by Assembly Member Kevin Mullin, would clarify that joint powers authorities may exercise any power common to the contracting parties, including levying fees and taxes.

The law governing joint powers authorities has always allowed the contracting parties to exercise any common powers, as long as they are specified in the joint powers agreement; therefore, the statement that the bill is declaratory of existing law is important. This bill would clarify current law so that there could be no doubt that this authority extends to the imposition of fees and taxes.

Joint powers authorities are an important part of California governance, and clarifying the law is an appropriate means to ensure a common understanding of joint powers authorities’ powers to levy fees or taxes.

AB 2170 awaits the Governor’s decision after passing the Senate and Assembly on largely party-line votes.

AB 2231 (Gordon) – Support

AB 2231, by Assembly Member Rich Gordon, would restore the Senior Citizens’ Property Tax Postponement Program, which allows seniors and people with disabilities to stay in their homes without paying property taxes. The property taxes are paid when ownership of the home changes.

The Assembly passed AB 2231 unanimously last Wednesday after the Senate’s unanimous approval two days previous. The bill now moves to the Governor’s desk.

Public Officials

AB 1948 (Mullin) – Concerns

AB 1948, by Assembly Member Kevin Mullin, would impose minimum training/education requirements for those elected or appointed to the office of County Treasurer/Tax Collector. Under current law, county Board of Supervisors can adopt minimum standards for the position of County Treasurer/Tax Collector, both appointed and elected. Many Boards of Supervisors have exercised this authority while some have not.

The bill has been approved by the Senate and Assembly and now awaits the Governor’s decision.

Broadband

SB 1364 (Fuller) – Support

SB 1364, by Senator Jean Fuller, would extend the sunset date for the California High-Cost Fund-A (CHCF-A) and CHCF-B until 2019.

California’s two high-cost funds, A and B, subsidize small independent telephone companies and large telephone corporations respectively to provide service in the rural and smaller metropolitan communities. These subsidies, paid for by surcharges on telephone bills, promote universal service by helping to ensure reasonable rates for basic telephone service and internet access in hard-to-reach areas of the state. Affordable telephone and other telecommunication rates are vital to both residential and business customers in our member counties.

The Senate passed SB 1364 unanimously last Tuesday after a similarly unanimous vote in the Assembly on Monday. The bill now moves to the Governor.

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September 2, 2014 Jean Kinney Hurst Geoffrey Neill

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October 22, 2012
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