BILL ANALYSIS Ó AB 1352 Page 1 Date of Hearing: September 8, 2011 ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT Cameron Smyth, Chair AB 1352 (Logue) - As Amended: August 30, 2011 SUBJECT : Taxation: vehicle license fees. SUMMARY : Provides that specified vehicle license fee (VLF) revenues deposited into the Local Revenue Fund of 2011 for local law enforcement realignment purposes would not be subject to expenditure requirements of a local ordinance in Nevada County. The Senate amendments delete the Assembly version of this bill, and instead: 1)State that designated VLF revenues shall not, for purposes of an ordinance of the County of Nevada, be deemed VLF revenues as defined in the California Constitution. 2)Define, for purposes of the bill, the term "designated vehicle license fee revenues" to mean vehicle license revenues that are collected and required to be deposited into the Local Law Enforcement Services Account in the Local Revenue Fund 2011. 3)Declare that a special law is necessary because of the unique circumstances related to a local ordinance governing the expenditure of VLF funds received by Nevada County. 4)Provide that no reimbursement is required by the provisions of the bill. EXISTING LAW : 1)Provides for the imposition of an annual VLF for any vehicle subject to registration in California. 2)Directs that specified VLF revenues collected after July 1, 2011, be distributed to the Local Law Enforcement Services Account in the Local Revenue Fund 2011 for allocation to cities, counties and cities and counties for local public safety AS PASSED BY THE ASSEMBLY , this bill granted the State Board of Equalization, meeting as a public body, discretion to relieve AB 1352 Page 2 interest under specified circumstances. FISCAL EFFECT : According to the Senate Appropriations Committee, there are no state costs as a result of the Nevada County VLF provisions. COMMENTS : In March of 1996, Nevada County voters approved Measure F, an initiative that required that all funds received from the State of California from VLF funds, as defined in the State Constitution and in statute, must be segregated into a separate accounting fund. The initiative required that Nevada County spend at least half of those funds in each fiscal year only for public roads, ways, and highways for maintenance repair, circulation enhancement, general road safety, and fire access in the unincorporated portion of the county. Nevada County officials, as a result of additional VLF revenues contained in the February 2009 budget agreement, believed that Measure F would require them to make a general fund expenditure on roads in an amount equal to half of the amount of additional VLF revenues allocated to the for law enforcement purposes. SB 636 (Ashburn), Chapter 605, Statutes of 2009, was enacted to ensure that the increased VLF revenues dedicated for local law enforcement purposes would not be subject to the requirements of Measure F. This bill would enact similar provisions to ensure that VLF revenues dedicated to local law enforcement as part of the realignment package, as specified in SB 89 (Committee on Budget and Fiscal Review), Chapter 35, Statutes of 2011, are not subject to the requirements of Nevada County's local ordinance. Support arguments: In the years since Measure F was enacted, two state budgets, in 2009 and 2011, have funded local public safety programs via a portion of the VLF. This bill ensures that the additional VLF revenues are not subject to the requirements of Nevada County's local ordinance. Opposition arguments: Instead of seeking a legislative remedy, Nevada County officials may want to consider revising Measure F to narrow the application of the ordinance to a specified portion of VLF funds that is not required by law to be used for law enforcement purposes. REGISTERED SUPPORT / OPPOSITION : AB 1352 Page 3 Support Nevada County Board of Supervisors ÝSPONSOR] California State Sheriffs' Association Nevada County Office of the District Attorney Nevada County Probation Department Nevada County Sheriff's Office Regional Council of Rural Counties Opposition None on file Analysis Prepared by : Debbie Michel / L. GOV. / (916) 319-3958