BILL NUMBER: AB 1191 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY JANUARY 23, 2012
AMENDED IN ASSEMBLY JANUARY 4, 2012
INTRODUCED BY Assembly Member Huber
FEBRUARY 18, 2011
An act to amend Sections 97.68 and 97.70 of the Revenue and
Taxation Code, relating to local government finance , and
declaring the urgency thereof, to take effect immediately .
LEGISLATIVE COUNSEL'S DIGEST
AB 1191, as amended, Huber. Local government finance.
(1) Existing law requires the county auditor, in each fiscal year,
to allocate property tax revenue to local jurisdictions in
accordance with specified formulas and procedures, and generally
requires that each jurisdiction be allocated an amount equal to the
total of the amount of revenue allocated to that jurisdiction in the
prior fiscal year, subject to certain modifications, and that
jurisdiction's portion of the annual tax increment, as defined.
Existing property tax law also reduces the amounts of ad valorem
property tax revenue that would otherwise be annually allocated to
the county, cities, and special districts pursuant to these general
allocation requirements by requiring, for purposes of determining
property tax revenue allocations in each county for the 1992-93 and
1993-94 fiscal years, that the amounts of property tax revenue deemed
allocated in the prior fiscal year to the county, cities, and
special districts be reduced in accordance with certain formulas.
Existing law requires that the revenues not allocated to the county,
cities, and special districts as a result of these reductions be
transferred to the Educational Revenue Augmentation Fund in that
county for allocation to school districts, community college
districts, and the county office of education.
Existing law requires the county auditor to decrease, for the
fiscal adjustment period, as defined, the amount of ad valorem
property tax revenue allocated to a county's Educational Revenue
Augmentation Fund by the countywide adjustment amount, as defined,
and requires the auditor to instead allocate this amount to the Sales
and Use Tax Compensation Fund in the county. Existing law requires,
during this same period, the county auditor to allocate moneys from
the Sales and Use Tax Compensation Fund to cities and counties to
reimburse these entities for local tax revenue losses resulting from
a specified statute, as provided. Existing law requires these
allocations to be made in a manner that ensures that the amount of ad
valorem property tax revenue allocated to cities, counties, and
special districts pursuant to specified statutes is not reduced.
This bill would, for the 2012-13 fiscal year and for each fiscal
year thereafter, if there is not enough ad valorem property tax
revenue that is otherwise required to be allocated to a county
Educational Revenue Augmentation Fund for the county auditor to
complete the decreases required during the fiscal adjustment period,
require the county auditor to calculate an amount, as specified, and
to submit a claim to the Controller for that amount. This bill would
require the Controller, upon appropriation by the Legislature, to
deposit the amount of the claim into the Sales and Use Tax
Compensation Fund, and would require the county auditor to allocate
that amount among the county and to each city in the county.
(2) The Vehicle License Fee (VLF) Law establishes, in lieu of any
ad valorem property tax upon vehicles, an annual license fee for any
vehicle subject to registration in this state. Beginning with the
2004-05 fiscal year and for each fiscal year thereafter, existing law
requires that each city, county, and city and county receive a
vehicle license fee adjustment amount (VLFAA), as defined, from a
Vehicle License Fee Property Tax Compensation Fund (VLFPTCF) that
exists in each county treasury. Existing law requires that these
amounts be funded from ad valorem property tax revenues otherwise
required to be allocated to educational entities.
This bill would, for the 2012-13 fiscal year and for each fiscal
year thereafter, if there is not enough ad valorem property tax
revenue that is otherwise required to be allocated to educational
entities for the county auditor to make the VLFAA payments, require
the county auditor to allocate to the VLFPTCF a specified amount of
ad valorem property tax revenue, that is not required to be allocated
under a specified statute, to an elementary, high school, or unified
school district. This bill would require the county auditor, if
there is still not enough ad valorem property tax revenue to make the
VLFAA payments, to submit a claim to the Controller for the
remaining amount necessary to make those payments. This bill would,
upon appropriation by the Legislature, require the Controller to
deposit the amount of the claim into the VLFPTCF, and would require
the county auditor to allocate that amount in the manner provided by
the existing payment provisions.
(3) By imposing additional duties upon local tax officials with
respect to the allocation of ad valorem property tax revenues, this
bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that, if the Commission on State Mandates
determines that the bill contains costs mandated by the state,
reimbursement for those costs shall be made pursuant to these
statutory provisions.
(4) This bill would declare that it is to take effect
immediately as an urgency statute.
Vote: majority 2/3 . Appropriation:
no. Fiscal committee: yes. State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature finds and declares all of the
following:
(a) The vehicle license fee (VLF) has been a longstanding and
critical funding source exclusively reserved for cities and counties.
(b) The Legislature and the state chose to grant significant
relief to the vehicle owning public in 1998 and made that relief
permanent in 2004. When these choices were made, an undisputable
condition of this relief was that cities and counties would continue
to receive funding as if the full VLF were still in place.
(c) When the state needed a dedicated funding source to secure its
Economic Recovery Bonds to afford the state significant and extended
budget relief, the state turned to a one-fourth cent of the local
sales and use tax as that identified source. Again, the transaction
was predicated upon the principle that local governments would be
held completely harmless and reimbursed on a dollar-for-dollar basis
until the bonds were repaid and the local sales and use tax returned.
(d) Due to economic conditions unforeseen by either the state or
local governments in some counties, including, but not limited to,
the County of Amador and the County of Mono, all school districts
within these counties have become basic aid districts, eliminating
the ability to backfill cities and counties for the loss of VLF
revenues or local sales and use tax revenue, thereby leaving these
local agencies with no local source to fund either the VLF swap or
the triple flip, resulting in severe budget shortfalls.
(e) Absent a state solution, permanent and irreparable harm and
damage will be done to local governments within these counties
through no fault of their own, forcing unthinkable layoffs and
service reductions that cannot be mitigated locally.
(f) It is the intent of the Legislature in enacting this act to
address the unintended and detrimental situation described above.
SEC. 2. Section 97.68 of the Revenue and Taxation Code is amended
to read:
97.68. Notwithstanding any other provision of law, in allocating
ad valorem property tax revenue allocations for each fiscal year
during the fiscal adjustment period, all of the following apply:
(a) (1) The total amount of ad valorem property tax revenue
otherwise required to be allocated to a county's Educational Revenue
Augmentation Fund shall be reduced by the countywide adjustment
amount.
(2) The countywide adjustment amount shall be deposited in a Sales
and Use Tax Compensation Fund that shall be established in the
treasury of each county.
(b) For purposes of this section, the following definitions apply:
(1) "Fiscal adjustment period" means the period beginning with the
2004-05 fiscal year and continuing through the fiscal year in which
the Director of Finance notifies the State Board of Equalization
pursuant to subdivision (b) of Section 99006 of the Government Code.
(2) Except as otherwise provided in subdivision (d), the
"countywide adjustment amount" means the combined total revenue loss
of the county and each city in the county that is annually estimated
by the Director of Finance, based upon the actual amount of sales and
use tax revenues transmitted under Section 7204 in that county in
the prior fiscal year and any projected growth on that amount for the
current fiscal year as determined by the State Board of Equalization
and reported to the director on or before August 15 of each fiscal
year during the fiscal adjustment period, to result for each of those
fiscal years from the 0.25 percent reduction in local sales and use
rate tax authority applied by Section 7203.1. The director shall
adjust the estimates described in this paragraph if the board reports
to him or her any changes in the projected growth in local sales and
use tax revenues for the current fiscal year.
(3) "In lieu local sales and use tax revenues" means those
revenues that are transferred under this section to a county or a
city from a Sales and Use Tax Compensation Fund or an Educational
Revenue Augmentation Fund.
(c) Except as otherwise provided in subdivision (d), for each
fiscal year during the fiscal adjustment period, in lieu sales and
use tax revenues in the Sales and Use Tax Compensation Fund shall be
allocated among the county and the cities in the county, and those
allocations shall be subsequently adjusted, as follows:
(1) The Director of Finance shall, on or before September 1 of
each fiscal year during the fiscal adjustment period, notify each
county auditor of that portion of the countywide adjustment amount
for that fiscal year that is attributable to the county and to each
city within that county.
(2) The county auditor shall allocate revenues in the Sales and
Use Tax Compensation Fund among the county and cities in the county
in the amounts described in paragraph (1). The auditor shall allocate
one-half of the amount described in paragraph (1) in each January
during the fiscal adjustment period and shall allocate the balance of
that amount in each May during the fiscal adjustment period.
(3) After the end of each fiscal year during the fiscal adjustment
period, other than a fiscal year subject to subdivision (d), the
Director of Finance shall, based on the actual amount of sales and
use tax revenues that were not transmitted for the prior fiscal year,
recalculate each amount estimated under paragraph (1) and notify the
county auditor of the recalculated amount.
(4) If the amount recalculated under paragraph (3) for the county
or any city in the county is greater than the amount allocated to
that local agency under paragraph (2), the county auditor shall, in
the fiscal year next following the fiscal year for which the
allocation was made, transfer an amount of ad valorem property tax
revenue equal to this difference from the Sales and Use Tax
Compensation Fund to that local agency.
(5) If the amount recalculated under paragraph (3) for the county
or any city in the county is less than the amount allocated to that
local agency under paragraph (2), the county auditor shall, in the
fiscal year next following the fiscal year for which the allocation
was made, reduce the total amount of ad valorem property tax revenue
otherwise allocated to that city or county from the Sales and Use Tax
Compensation Fund by an amount equal to this difference and instead
allocate this difference to the county Educational Revenue
Augmentation Fund.
(6) If there is an insufficient amount of moneys in a county's
Sales and Use Tax Compensation Fund to make the transfers required by
paragraph (4), the county auditor shall transfer from the county
Educational Revenue Augmentation Fund an amount sufficient to make
the full amount of these transfers.
(d) Notwithstanding any other provision of this section, when
Section 7203.1 ceases to be operative, all of the following apply:
(1) If Section 7203.1 ceases to be operative on an October 1 of a
fiscal year during the fiscal adjustment period, all of the following
apply:
(A) The "countywide adjustment amount" for that fiscal year means
an amount equal to sum of the following two amounts:
(i) The combined total revenue loss of the county and each city in
the county that is estimated by the director, based upon actual
sales and use tax revenues transmitted under Section 7204 for the
first quarter of the prior fiscal year as determined by the State
Board of Equalization and reported to the director on or before that
August 15, to result for the first quarter of the current fiscal year
from the 0.25 percent reduction in local sales and use tax rate
authority applied by Section 7203.1.
(ii) The difference between the following two amounts:
(I) The total amount that was allocated to the county and each
city in the county under subdivision (c) for the prior fiscal year.
(II) The actual total amount of local sales and use tax revenue
that was not transmitted the county or city and county and each city
in the county for the prior fiscal year as a result of the 0.25
percent suspension of local sales and use tax authority applied by
Section 7203.1.
(B) On or before January 31 of that fiscal year, the auditor shall
allocate to the county and each city in the county that portion of
the countywide adjustment amount for that fiscal year that is
attributable to the county and each city in the county.
(C) On or before May 1 of that fiscal year, the State Board of
Equalization shall report to the director the actual total amount of
local sales and use tax revenue that was not transmitted to the
county and each city in the county in that fiscal year as a result of
the 0.25 percent suspension of local sales and use tax authority
applied by Section 7203.1. On or before May 1 of that fiscal year,
the director shall do both of the following:
(i) Determine the difference between the following two amounts:
(I) The amount specified in clause (i) of subparagraph (A) that
was allocated to the county and each city in the county for that
fiscal year under subparagraph (B).
(II) The actual total amount of local sales and use tax revenue
that was not transmitted to the county and each city in the county
for that fiscal year as a result of the 0.25 percent suspension of
local sales and use tax authority applied by Section 7203.1.
(ii) Notify the auditor of each county of the amounts determined
under clause (i) for his or her county and all of the cities in that
county.
(D) (i) If, for any county or city, the amount described in
subclause (I) of clause (i) of subparagraph (C) is greater than the
amount described in subclause (II) of clause (i) of subparagraph (C),
the county auditor shall, on or before May 31 of that fiscal year,
reallocate from the entity to the county Educational Revenue
Augmentation Fund the difference between those amounts.
(ii) If, for any county or city, the amount described in subclause
(I) of clause (i) of subparagraph (C) is less than the amount
described in subclause (II) of clause (i) of subparagraph (C), the
county auditor shall, on or before May 31 of that fiscal year,
reallocate from the county Educational Revenue Augmentation Fund to
that entity the difference between those amounts.
(2) If Section 7203.1 ceases to be operative on a January 1 of a
fiscal year during the fiscal adjustment period, all of the following
apply:
(A) The "countywide adjustment amount" for that fiscal year means
an amount equal to the sum of the following two amounts:
(i) The combined total revenue loss of the county and each city in
the county that is estimated by the director, based upon actual
sales and use tax revenues transmitted under Section 7204 for the
first and second quarters of the prior fiscal year as determined by
the State Board of Equalization and reported to the director on or
before that August 15, to result for the first and second quarters of
that fiscal year from the 0.25 percent reduction in local sales and
use tax rate authority applied by Section 7203.1.
(ii) The difference between the following two amounts:
(I) The total amount that was allocated to the county and each
city in the county under subdivision (c) for the prior fiscal year.
(II) The actual total amount of local sales and use tax revenue
that was not transmitted to the county or city and county
and each city in the county for the prior fiscal year as a result of
the 0.25 percent suspension of local sales and use tax authority
applied by Section 7203.1.
(B) The auditor shall allocate to the county and each city in the
county that portion of the countywide adjustment amount for that
fiscal year that is attributable to the county and each city in the
county. One-half of this amount shall be allocated on or before
January 31 of that fiscal year and the other one-half of that amount
shall be allocated on or before May 31 of that fiscal year.
(C) On or before June 30 of that fiscal year, the State Board of
Equalization shall report to the director the actual total amount of
local sales and use tax revenue that was not transmitted to the
county and each city in the county for that fiscal year as a result
of the 0.25 percent suspension of local sales and use tax authority
applied by Section 7203.1. On or before June 30 of that fiscal year,
the director shall do both of the following:
(i) Determine the difference between the following two amounts:
(I) The amount specified in clause (i) of subparagraph (A) that
was allocated to the county and each city in the county for that
fiscal year under subparagraph (B).
(II) The actual total amount of local sales and use tax revenue
that was not transmitted to the county and each city in the county
for that fiscal year as a result of the 0.25 percent suspension of
local sales and use tax authority applied by Section 7203.1.
(ii) Notify the auditor of each county of the amounts determined
under clause (i) for his or her county and all of the cities in that
county.
(D) (i) If, for any county or city, the amount described in
subclause (I) of clause (i) of subparagraph (C) is greater than the
amount described in subclause (II) of clause (i) of subparagraph (C),
the county auditor shall, on or before January 31 of the following
fiscal year, reallocate from the entity to the county Educational
Revenue Augmentation Fund the difference between those amounts.
(ii) If, for any county or city, the amount described in subclause
(I) of clause (i) of subparagraph (C) is less than the amount
described in subclause (II) of clause (i) of subparagraph (C), the
county auditor shall, on or before January 31 of the following fiscal
year, reallocate from the county Educational Revenue Augmentation
Fund to that entity the difference between those amounts.
(3) If Section 7203.1 ceases to be operative on an April 1 of a
fiscal year during the fiscal adjustment period, all of the following
apply:
(A) On or before May 1 of that fiscal year, the director shall
determine and report to the auditor of each county that portion of
the countywide adjustment amount that is attributable to the
estimated sales and use tax revenue losses, resulting from the rate
suspension applied by Section 7203.1, for the fourth quarter of that
fiscal year for the county and each city in the county.
(B) The auditor shall reduce the total amount that is otherwise
required to be allocated in May of that fiscal year from the county
Sales and Use Tax Compensation Fund to the county and each city in
the county by the amount reported by the director with respect to
that entity under subparagraph (A). After the May allocations have
been made, the auditor shall transfer any moneys remaining in the
county Sales and Use Tax Compensation Fund to the county Educational
Revenue Augmentation Fund.
(C) On or before January 1 of the next fiscal year, the State
Board of Equalization shall report to the director the actual total
amount of local sales and use tax revenue that was not transmitted to
the county and each city in the county for the prior fiscal year as
a result of the 0.25 percent suspension of local sales and use tax
authority applied by Section 7203.1. On or before January 1 of that
fiscal year, the director shall do both of the following:
(i) Determine the difference between the following two amounts:
(I) The total amount that was allocated to the county and each
city in the county for the prior fiscal year under subdivision (c),
as adjusted under subparagraph (B).
(II) The actual total amount of local sales and use tax revenue
that was not transmitted to the county and each city in the county
for the prior fiscal year as a result of the 0.25 percent suspension
of local sales and use tax authority applied by Section 7203.1.
(ii) Notify the auditor of each county of the amounts determined
under clause (i) for his or her county and all of the cities in that
county.
(D) (i) If, for any county or city, the amount described in
subclause (I) of clause (i) of subparagraph (C) is greater than the
amount described in subclause (II) of clause (i) of subparagraph (C),
the county auditor shall, on or before January 31 of that fiscal
year, reallocate from the entity to the county Educational Revenue
Augmentation Fund the difference between those amounts.
(ii) If, for any county or city, the amount described in subclause
(I) of clause (i) of subparagraph (C) is less than the amount
described in subclause (II) of clause (i) of subparagraph (C), the
county auditor shall, on or before January 31 of the following fiscal
year, reallocate from the county Educational Revenue Augmentation
Fund to that entity the difference between those amounts.
(4) If Section 7203.1 ceases to be operative on a July 1, all of
the following apply:
(A) On or before January 1 of that fiscal year, the State Board of
Equalization shall notify the Director of Finance of the actual
total amount of local sales and use tax revenue that was not
transmitted to each county and city for the prior fiscal year as a
result of the 0.25 percent suspension of local sales and use tax
authority applied by Section 7203.1.
(B) On or before January 31 of that fiscal year, the director
shall do both of the following:
(i) Determine for each city, county, and city and county, the
difference between the following two amounts:
(I) The total amount that was allocated to that entity under
subdivision (c) for the prior fiscal year.
(II) The actual total amount of local sales and use tax revenue
that was not transmitted to the entity for the prior fiscal year as a
result of the 0.25 percent suspension of local sales and use tax
authority applied by Section 7203.1.
(ii) Notify the auditor of each county of the amounts determined
under clause (i) for his or her county and all of the cities in that
county.
(C) (i) If, for any county or city, the amount described in
subclause (I) of clause (i) of subparagraph (B) is greater than the
amount described in subclause (II) of clause (i) of subparagraph (B),
the county auditor shall, on or before January 31 of that fiscal
year, reallocate from the entity to the county Educational Revenue
Augmentation Fund the difference between those amounts.
(ii) If, for any county or city, the amount described in subclause
(I) of clause (i) of subparagraph (B) is less than the amount
described in subclause (II) of clause (i) of subparagraph (B), the
county auditor shall, on or before January 31 of the following fiscal
year, reallocate from the county Educational Revenue Augmentation
Fund to that entity the difference between those amounts.
(e) For the 2012-13 fiscal year and for each fiscal year
thereafter, if there is not enough ad valorem property tax revenue
that is otherwise required to be allocated to a county Educational
Revenue Augmentation Fund for the county auditor to complete the
allocations required by this section, the county auditor shall
calculate, for each county and each city in the county, the
difference between the countywide adjustment amount for that fiscal
year and the in lieu local sales and use tax revenues actually
received by each county and city in the county for that fiscal year
pursuant to this section, and shall submit a claim to the Controller
for the total amount of the difference. The Controller shall, upon
appropriation by the Legislature, deposit the amount of the claim
into the Sales and Use Tax Compensation Fund. The county auditor
shall, within 30 days of the date the Controller deposits the amount
of the claim into the Sales and Use Tax Compensation Fund, allocate
to each county and to each city in the county the amount of the
difference that was calculated by the county auditor for each county
and each city in the county pursuant to this subdivision.
(f) For the 2005-06 fiscal year and each fiscal year thereafter,
the amounts determined under subdivision (a) of Section 96.1, or any
successor to that provision, may not reflect any portion of any
property tax revenue allocation required by this section for a
preceding fiscal year.
(g) This section may not be construed to do any of the following:
(1) Reduce any allocations of excess, additional, or remaining
funds that would otherwise have been allocated to cities, counties,
cities and counties, or special districts pursuant to clause (i) of
subparagraph (B) of paragraph (4) of subdivision (d) of Section 97.2,
clause (i) of subparagraph (B) of paragraph (4) of subdivision (d)
of Section 97.3, or Article 4 (commencing with Section 98), had this
section not been enacted. The allocation made pursuant to
subdivisions (a) and (c) shall be adjusted to comply with this
paragraph.
(2) Require an increased ad valorem property tax revenue
allocation to a community redevelopment agency.
(3) Alter the manner in which ad valorem property tax revenue
growth from fiscal year to fiscal year is determined or allocated in
a county.
(h) Existing tax exchange or revenue sharing agreements, entered
into prior to the operative date of this section, between local
agencies or between local agencies and nonlocal agencies shall be
deemed to be temporarily modified to account for the reduced sales
and use tax revenues, resulting from the temporary reduction in the
local sales and use tax rate, with those reduced revenues to be
replaced in kind by property tax revenue from a Sales and Use Tax
Compensation Fund or an Educational Revenue Augmentation Fund, on a
temporary basis, as provided by this section.
SEC. 3. Section 97.70 of the Revenue and Taxation Code is amended
to read:
97.70. Notwithstanding any other provision of law, for the
2004-05 fiscal year and for each fiscal year thereafter, all of the
following apply:
(a) (1) (A) The auditor shall reduce the total amount of ad
valorem property tax revenue that is otherwise required to be
allocated to a county's Educational Revenue Augmentation Fund by the
countywide vehicle license fee adjustment amount.
(B) If, for the fiscal year, after complying with Section 97.68
there is not enough ad valorem property tax revenue that is otherwise
required to be allocated to a county Educational Revenue
Augmentation Fund for the auditor to complete the allocation
reduction required by subparagraph (A), the auditor shall
additionally reduce the total amount of ad valorem property tax
revenue that is otherwise required to be allocated to all school
districts and community college districts in the county for that
fiscal year by an amount equal to the difference between the
countywide vehicle license fee adjustment amount and the amount of ad
valorem property tax revenue that is otherwise required to be
allocated to the county Educational Revenue Augmentation Fund for
that fiscal year. This reduction for each school district and
community college district in the county shall be the percentage
share of the total reduction that is equal to the proportion that the
total amount of ad valorem property tax revenue that is otherwise
required to be allocated to the school district or community college
district bears to the total amount of ad valorem property tax revenue
that is otherwise required to be allocated to all school districts
and community college districts in a county. For purposes of this
subparagraph, "school districts" and "community college districts" do
not include any districts that are excess tax school entities, as
defined in Section 95.
(C) For the 2012-13 fiscal year and for each fiscal year
thereafter, if, after applying subparagraph (B), the auditor is
unable to complete the reduction required by subparagraph (A), the
auditor shall, after complying with Section 75.70, allocate to the
Vehicle License Fee Property Tax Compensation Fund from any remaining
ad valorem property tax revenue that is not required to be allocated
to any elementary, high school, or unified school district pursuant
to paragraph (6) of subdivision (c) of Section 75.70, an amount equal
to that portion of the reduction required by subparagraph (A) that
could not be made pursuant to subparagraphs (A) and (B).
(D) If, after making the allocation required by subparagraph (C),
there is still not enough ad valorem property tax revenue for the
auditor to complete the reduction required by subparagraph (A), the
auditor shall submit a claim to the Controller for the remaining
difference. The Controller shall, upon appropriation by the
Legislature, deposit the amount of the claim into the Vehicle License
Fee Property Tax Compensation Fund. The auditor shall, within 30
days of the date the Controller deposits the amount of the claim into
the Vehicle License Fee Property Tax Compensation Fund, allocate
that amount among the cities, county, and city and county in
accordance with this section.
(2) The countywide vehicle license fee adjustment amount shall be
allocated to the Vehicle License Fee Property Tax Compensation Fund
that shall be established in the treasury of each county.
(b) (1) The auditor shall allocate moneys in the Vehicle License
Fee Property Tax Compensation Fund according to the following:
(A) Each city in the county shall receive its vehicle license fee
adjustment amount.
(B) Each county and city and county shall receive its vehicle
license fee adjustment amount.
(2) The auditor shall allocate one-half of the amount specified in
paragraph (1) on or before January 31 of each fiscal year, and the
other one-half on or before May 31 of each fiscal year.
(c) For purposes of this section, all of the following apply:
(1) "Vehicle license fee adjustment amount" for a particular city,
county, or a city and county means, subject to an adjustment under
paragraph (2) and Section 97.71, all of the following:
(A) For the 2004-05 fiscal year, an amount equal to the difference
between the following two amounts:
(i) The estimated total amount of revenue that would have been
deposited to the credit of the Motor Vehicle License Fee Account in
the Transportation Tax Fund, including any amounts that would have
been certified to the Controller by the auditor of the County of
Ventura under subdivision (j) of Section 98.02, as that section read
on January 1, 2004, for distribution under the law as it read on
January 1, 2004, to the county, city and county, or city for the
2004-05 fiscal year if the fee otherwise due under the Vehicle
License Fee Law (Pt. 5 (commencing with Section 10701) of Div. 2) was
2 percent of the market value of a vehicle, as specified in Section
10752 and 10752.1 as those sections read on January 1, 2004.
(ii) The estimated total amount of revenue that is required to be
distributed from the Motor Vehicle License Fee Account in the
Transportation Tax Fund to the county, city and county, and each city
in the county for the 2004-05 fiscal year under Section 11005, as
that section read on the operative
date of the act that amended this clause.
(B) (i) Subject to an adjustment under clause (ii), for the
2005-06 fiscal year, the sum of the following two amounts:
(I) The difference between the following two amounts:
(Ia) The actual total amount of revenue that would have been
deposited to the credit of the Motor Vehicle License Fee Account in
the Transportation Tax Fund, including any amounts that would have
been certified to the Controller by the auditor of the County of
Ventura under subdivision (j) of Section 98.02, as that section read
on January 1, 2004, for distribution under the law as it read on
January 1, 2004, to the county, city and county, or city for the
2004-05 fiscal year if the fee otherwise due under the Vehicle
License Fee Law (Part 5 (commencing with Section 10701) of Division
2) was 2 percent of the market value of a vehicle, as specified in
Sections 10752 and 10752.1 as those sections read on January 1, 2004.
(Ib) The actual total amount of revenue that was distributed from
the Motor Vehicle License Fee Account in the Transportation Tax Fund
to the county, city and county, and each city in the county for the
2004-05 fiscal year under Section 11005, as that section read on the
operative date of the act that amended this sub-subclause.
(II) The product of the following two amounts:
(IIa) The amount described in subclause (I).
(IIb) The percentage change from the prior fiscal year to the
current fiscal year in gross taxable assessed valuation within the
jurisdiction of the entity, as reflected in the equalized assessment
roll for those fiscal years. For the first fiscal year for which a
change in a city's jurisdictional boundaries first applies, the
percentage change in gross taxable assessed valuation from the prior
fiscal year to the current fiscal year shall be calculated solely on
the basis of the city's previous jurisdictional boundaries, without
regard to the change in that city's jurisdictional boundaries. For
each following fiscal year, the percentage change in gross taxable
assessed valuation from the prior fiscal year to the current fiscal
year shall be calculated on the basis of the city's current
jurisdictional boundaries.
(ii) The amount described in clause (i) shall be adjusted as
follows:
(I) If the amount described in subclause (I) of clause (i) for a
particular city, county, or city and county is greater than the
amount described in subparagraph (A) for that city, county, or city
and county, the amount described in clause (i) shall be increased by
an amount equal to this difference.
(II) If the amount described in subclause (I) of clause (i) for a
particular city, county, or city and county is less than the amount
described in subparagraph (A) for that city, county, or city and
county, the amount described in clause (i) shall be decreased by an
amount equal to this difference.
(C) For the 2006-07 fiscal year and for each fiscal year
thereafter, the sum of the following two amounts:
(i) The vehicle license fee adjustment amount for the prior fiscal
year, if Section 97.71 and clause (ii) of subparagraph (B) did not
apply for that fiscal year, for that city, county, and city and
county.
(ii) The product of the following two amounts:
(I) The amount described in clause (i).
(II) The percentage change from the prior fiscal year to the
current fiscal year in gross taxable assessed valuation within the
jurisdiction of the entity, as reflected in the equalized assessment
roll for those fiscal years. For the first fiscal year for which a
change in a city's jurisdictional boundaries first applies, the
percentage change in gross taxable assessed valuation from the prior
fiscal year to the current fiscal year shall be calculated solely on
the basis of the city's previous jurisdictional boundaries, without
regard to the change in that city's jurisdictional boundaries. For
each following fiscal year, the percentage change in gross taxable
assessed valuation from the prior fiscal year to the current fiscal
year shall be calculated on the basis of the city's current
jurisdictional boundaries.
(2) "Countywide vehicle license fee adjustment amount" means, for
any fiscal year, the total sum of the amounts described in paragraph
(1) for a county or city and county, and each city in the county.
(3) On or before June 30 of each fiscal year, the auditor shall
report to the Controller the vehicle license fee adjustment amount
for the county and each city in the county for that fiscal year.
(d) For the 2005-06 fiscal year and each fiscal year thereafter,
the amounts determined under subdivision (a) of Section 96.1, or any
successor to that provision, shall not reflect, for a preceding
fiscal year, any portion of any allocation required by this section.
(e) For purposes of Section 15 of Article XI of the California
Constitution, the allocations from a Vehicle License Fee Property Tax
Compensation Fund constitute successor taxes that are otherwise
required to be allocated to counties and cities, and as successor
taxes, the obligation to make those transfers as required by this
section shall not be extinguished nor disregarded in any manner that
adversely affects the security of, or the ability of, a county or
city to pay the principal and interest on any debts or obligations
that were funded or secured by that city's or county's allocated
share of motor vehicle license fee revenues.
(f) This section shall not be construed to do any of the
following:
(1) Reduce any allocations of excess, additional, or remaining
funds that would otherwise have been allocated to county
superintendents of schools, cities, counties, and cities and counties
pursuant to clause (i) of subparagraph (B) of paragraph (4) of
subdivision (d) of Sections 97.2 and 97.3 or Article 4 (commencing
with Section 98) had this section not been enacted. The allocations
required by this section shall be adjusted to comply with this
paragraph.
(2) Require an increased ad valorem property tax revenue
allocation or increased tax increment allocation to a community
redevelopment agency.
(3) Alter the manner in which ad valorem property tax revenue
growth from fiscal year to fiscal year is otherwise determined or
allocated in a county.
(4) Reduce ad valorem property tax revenue allocations required
under Article 4 (commencing with Section 98).
(g) Tax exchange or revenue sharing agreements, entered into prior
to the operative date of this section, between local agencies or
between local agencies and nonlocal agencies are deemed to be
modified to account for the reduced vehicle license fee revenues
resulting from the act that added this section. These agreements are
modified in that these reduced revenues are, in kind and in lieu
thereof, replaced with ad valorem property tax revenue from a Vehicle
License Fee Property Tax Compensation Fund or an Educational Revenue
Augmentation Fund.
SEC. 4. If the Commission on State Mandates determines that this
act contains costs mandated by the state, reimbursement to local
agencies and school districts for those costs shall be made pursuant
to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of
the Government Code.
SEC. 5. This act is an urgency statute necessary
for the immediate preservation of the public peace, health, or safety
within the meaning of Article IV of the Constitution and shall go
into immediate effect. The facts constituting the necessity are:
In order to provide immediate financial relief to local entities
that are not receiving the full countywide adjustment amount, as
provided in Section 97.68 of the Revenue and Taxation Code, or the
full vehicle license fee adjustment amount, as provided in Section
97.70 of the Revenue and Taxation Code, it is necessary that this act
take effect immediately.