BILL ANALYSIS                                                                                                                                                                                                    

          SENATOR ALAN LOWENTHAL, CHAIRMAN               AUTHOR:  gaines
                                                         VERSION: 4/8/10
          Analysis by: Art Bauer                         FISCAL:  No
          Hearing date: June 15, 2010


          Local government streets and road funds


          This bill continues the allocation of local snow removal funds. 


           Existing law  :

             1)   Imposes an excise tax of 18 cents per gallon on gasoline  
               and diesel fuel. 

             2)   Deposits the excise tax revenue in the Motor Vehicle  
               Fuel Account and transfers the revenue to the Highway Users  
               Tax Account (HUTA). 

             3)   Allocates about 65 percent of the HUTA funds to the  
               State Highway Account and about 35 percent to cities and  
               counties for street and road purposes with disbursements  
               made to cities and counties monthly according to various  

             4)   Apportions HUTA funds annually to cover 80 percent of  
               each county's cost of snow removal above $5,000 but not to  
               exceed $7 million statewide. 

             5)   Apportions HUTA funds to cover one-half of the cost of  
               snow removal above $5,000 to each city and city and county  
               that provides snow removal services. 

           This bill  requires the continuance of funding for local street  


          AB 2704 (GAINES)                                          Page 2


          and road snow removal in the event HUTA funds are diverted for  
          other purposes. 

              1)   Purpose  . This bill is intended to prevent the diversion  
               of HUTA for snow removal in the event the Legislature  
               enacts legislation to divert HUTA funds for other purposes.  

              2)   Background  . Last year SB 4X 30 (Ducheny), passed the  
               Senate. That bill contained a provision diverting HUTA  
               funds to the state General Fund. The Assembly did not take  
               this measure up for a vote, and so it failed to pass the  
               Legislature. This year AB 8X 5 (Committee on the Budget),  
               Chapter 1, Eighth Extraordinary Session, Statutes of 2010  
               delays HUTA payments to cities and counties for the months  
               of July 2010 through March 2011. HUTA payments for these  
               months will be made in one lump sum at the end of April  
               2011. Local agencies will receive no HUTA funds for snow  
               removal until after the snow season. The supporters of this  
               bill argue that snow removal is an imperative service as  
               without it children cannot get to school, the risk of motor  
               vehicles accidents increases,  movement of emergency  
               vehicles is inhibited, local economies that rely upon  
               winter visitors to recreational sites are harmed.

              3)   Practical effect of bill is limited  . This bill is a  
               statement of policy. It does not stop the Legislature from  
               suspending snow removal reimbursements in the event a  
               decision is reached to divert HUTA funds for other  
          Assembly Votes:
               Floor:    73-0
               Trans:    11-0

          POSITIONS:  (Communicated to the Committee before noon on  
                     June 9, 2010)

               SUPPORT: California State Association of Counties
                         Nevada County Board of Supervisors
                         Regional Council of Rural Counties
                        Siskiyou County Board of Supervisors       
                        Town of Mammoth Lakes


          AB 2704 (GAINES)                                          Page 3


                         Town of Truckee
               OPPOSED:  None received.