Gilroy
– Support for Proposition 1A is strong, and that makes local
governments smile.
If it passes, Prop. 1A will allow funding for local
governments
– including cities, counties and special districts – to stay
local. Local money from property taxes, vehicle license fees and
sales taxes will go toward public safety, health services,
libraries, parks and other locally provided services, instead of
the state taking it away – which has been th
e case since the early 1990s.
Gilroy – Support for Proposition 1A is strong, and that makes local governments smile.
If it passes, Prop. 1A will allow funding for local governments – including cities, counties and special districts – to stay local. Local money from property taxes, vehicle license fees and sales taxes will go toward public safety, health services, libraries, parks and other locally provided services, instead of the state taking it away – which has been the case since the early 1990s.
Under Prop. 1A, the only way the state could take local revenue is if the governor declares a fiscal emergency and two-thirds of legislators approve. Even then, the state would have to pay the full amount back to local governments within three years.
The proposition, which would take effect in 2006, also requires the state pay for any service or program that state lawmakers require local governments carry out.
Prop. 1A has strong backing, including local governments, labor and business organizations, police and firefighter groups, state Republican and Democratic parties and Gov. Arnold Schwarzenegger.
Supporters say Prop. 1A will save local governments billions of dollars over the course of several years, and that the state has taken as much as $40 billion from local governments since the early ’90s.
Gilroy City Manager Jay Baksa said more than $16 million in local tax revenue has gone to the state since the early ’90s, and about $2.1 million per year in local funding will keep going to the state if Prop. 1A doesn’t pass.
Opponents include state Assemblyman Darrell Steinberg, D-Sacramento, and Carol Migden, chairwoman of the state’s Board of Equalization and former Democratic assemblywoman, who claim the proposition will allow local governments to spend too freely and with no fiscal oversight.
“California has a responsibility to help and support local governments,” Migden stated in a letter explaining why she opposes the proposition. “We are all in this together. But no one should be exempt from fiscal oversight and accountability. Checks and balances are essential.”
One of Steinberg’s main arguments against the proposition is that it would cause local governments to rely too heavily on sales taxes as a source of their income, which could lead to a sprawl of big-box stores, auto malls and other sources of sales tax revenue. The drive to attract economic development could come at the expense of improving local services, Steinberg said.
Opponents also claim that states should have adequate funding for critical causes such as state universities, nursing homes and children’s health care.
But Baksa and other Prop. 1A supporters say local governments are entitled to what comes from their jurisdictions, and they should not be responsible for bailing out the state’s budget crisis.
“This is the most important proposition that affects you personally, of all the propositions, because it has to do with the money local taxpayers are paying and where exactly that money is going,” Baksa said.
Several cities statewide have been forced to shut down fire stations or cut services and personnel over the past several years because the state yanked local funding. Gilroy has been fortunate in that it hasn’t had to go that far, Baksa said, but that doesn’t mean the city hasn’t been affected.
“There are plenty of things we could have done but weren’t able to because of lack of funding,” he said. “We haven’t had the money for downtown improvements, or fully augmenting our street paving. We haven’t had the money to open a fourth fire station.”
Other city leaders from Gilroy, Hollister and Morgan Hill also are backing Prop. 1A.
Gilroy Mayor Al Pinheiro said the state has been taking local dollars for too long, and it’s time to reclaim what local governments deserve.
“If there was ever an opportunity for our citizens to keep our tax dollars in our local cities from being taken away, this is the chance,” he said.
Hollister Mayor Tony Bruscia also advocates the proposition.
“We need stability and consistency in our dollars. That’s why it’s really imperative that we get this passed,” Bruscia said.
Morgan Hill City Manager Ed Tewes said the vote for Prop. 1A is “critical” to local governments’ financial health.
Proposition 65
Supporters of Prop. 1A are encouraging voters to vote for 1A and against a related proposition that also is on the ballot, Proposition 65.
Prop. 65 is like 1A in that it protects local governments. It requires statewide voter approval of any legislation that would reduce local governments’ funding.
Prop. 65 qualified for the ballot – and legally could not be pulled – after a coalition of local government representatives gathered more than 1 million signatures petitioning for it. But soon after, city and council officials made a deal with Gov. Schwarzenegger. The deal said the governor would back a proposition similar to Prop. 65 if the state could have receive $2.6 billion in local funds, $1.3 billion this year and $1.3 billion next year.
Under the deal, the state would not have to pay that money back, but it would have to pay back $1.2 billion that it borrowed from local governments last year for vehicle licensing fees.
The deal also specified that local governments would encourage Californians to vote against 65 because it doesn’t allow provisions for fiscal emergencies, and 1A does.
So now, both propositions are on the ballot, and whichever one gets the most votes wins. And even though the same people who wrote Prop. 65 also wrote 1A, they’ve abandoned their support for 65 and are hoping 1A passes.
Certain “poison pill” language in Prop. 1A states that even if Prop. 65 passes, it won’t go into effect. But if Prop. 65 gets more votes than Prop. 1A, a court will decide how to proceed.
Staff writers Carol Holzgrafe and Jessica Quandt contributed to this report.
Prop 1A would:
• keep property and sales tax revenues with local govts.
• allow the state to dip into local funding only if the gov. declares a fiscal emergency and two-thirds of the legislature agrees. Money paid back in three years.
• force the state to fund all state mandates imposed on local governments.
Prop 65 would:
• require statewide voter approval for reduction of local fees and tax revenues.
• permit local governments to suspend a state mandate if the state does not reimburse local governments within 180 days of when the mandate was issued.
