By Serdar Tumgoren – Staff Writer
Gilroy
– The approval of state Proposition 1A effectively ends state
tithing of local tax revenues and could, in coming years, breathe
new life into local emergency services and revitalization projects,
according to city officials.
By Serdar Tumgoren – Staff Writer
Gilroy – The approval of state Proposition 1A effectively ends state tithing of local tax revenues and could, in coming years, breathe new life into local emergency services and revitalization projects, according to city officials.
The law, which 85 percent of California voters approved on Tuesday, effectively prevents the state from taking revenues from local governments – including cities, counties and special districts. The state can only take local tax dollars if the governor declares a fiscal emergency and two-thirds of legislators approve. Even then, the state would have to pay back the full amount within three years.
“This at least gives us an ability to know that the state government isn’t going to come down and put mandates on us that we can’t fund,” Mayor Al Pinheiro said. “It also provides a mechanism where they don’t just come and take money away. It gives us a little more comfort for the future.”
With the passage of Prop. 1A, the city can spend less time worrying about potential salvos to its budget and start looking at programs that have been sidelined for years.
Top priorities include fully staffing the Sunrise Fire Station, which serves the city’s northwest quadrant, with a four-man engine company that has paramedic capabilities. Currently, that station only has a two-person squad and limited firefighting capacity.
The city also projects the need for a fourth fire station off Santa Teresa. That station would serve Eagle Ridge and other developments emerging in the fast-growing southwest quadrant.
While acknowledging that Prop. 1A would not spell immediate expansion for the department, Fire Division Chief Phil King drew attention to the pressures of development and population growth.
“As those triggers are hit, we’ll need to get the fourth [station] opened in a few years,” he said.
The police department also has felt the strains of an unpredictable and tight budget, according to Gilroy City Administrator Jay Baksa.
“[The department] has been frozen in time,” he said. “We’re basically playing the game staffing-wise that we were playing two years ago, although the city has continued to grow in that time.”
A tighter and less certain budget also has affected the appearance of the city, forcing officials to scale back the sidewalk repair program and other improvements, and postpone downtown revitalization.
Residents walking Monterey Street will notice that new lighting and widened sidewalks trail off at the Sixth Street intersection. Federal grant money has not stretched far enough to extend those “pedestrian-friendly” features down to Third Street, as the city originally planned, according to Baksa.
Those types of public projects and services started falling by the wayside in 1991, when the state began supporting its own budget by dipping into local property taxes. In 2001, the state began drawing more heavily on local property taxes and started taking a percentage of sales taxes and vehicle licensing fees.
Baksa estimated the city lost $16 million during the last 20 years, and would continue to lose more than $2 million annually if Prop. 1A had failed.
“After 2006 (when the proposition takes effect), the yearly loss will only be $1 million per year,” Baksa explained. “Proposition 1A takes us back to three years ago.”
The proposition also prevents the state from placing unfunded mandates on local government.
Baksa estimated that such mandates, which include record-keeping and land-use requirements, cost cities and counties billions of dollars since 1991.
Prop. 1A represents a compromise between state and local lawmakers. The League of California Cities initially drafted Proposition 65 and got the measure on the ballot with the support of city councils, unions, and other groups throughout the state. Those same backers subsequently met with Governor Arnold Schwarzenegger and state lawmakers to craft a compromise – Proposition 1A, a version that allows flexibility in cases of fiscal emergencies and lets the state continue drawing on local tax revenues in the current and upcoming fiscal years.
At the urging of the governor and the League of California Cities, voters overwhelmingly threw their support behind Proposition 1A. In Santa Clara County, 85 percent of residents voted to approve the measure.
While it will not immediately jump-start Gilroy’s idling projects and services, it will put them on a path to recovery, according to Baksa.
“It allows our city council to start looking at things we couldn’t look at before,” he said.
Local priorities
Officials predict that the passage of Proposition 1A will help restore funding for numerous projects:
• Staffing Sunrise Fire Station and creating a fourth station for the southwest quadrant.
• Expanding the police force.
• Increasing sidewalk repairs and street improvements.
• Completing the downtown revitalization project.
