SB 69, as amended, Roth. Local government finance: property tax revenue allocation: vehicle license fee adjustments.
Existing property tax 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 provides that each jurisdiction shall 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 requires that, for purposes of determining property tax revenue allocations in each county for the 1992-93 and 1993-94 fiscal years, 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. It 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.
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 additional property tax revenues in the form of a vehicle license fee adjustment amount, as defined, from a Vehicle License Fee Property Tax Compensation Fund that exists in each county treasury. Existing law requires that these additional allocations be funded from ad valorem property tax revenues otherwise required to be allocated to educational entities.
This bill would modify these reduction and transfer provisions for a city incorporating after January 1, 2004,begin insert and on or before January 1, 2012,end insert for the 2014-15 fiscal year and for each fiscal year thereafter, by providing for a vehicle license fee adjustment amount calculated on the basis of changes in assessed valuation.
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.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.
The people of the State of California do enact as follows:
Section 97.70 of the Revenue and Taxation Code
2 is amended to read:
Notwithstanding any other law, for the 2004-05 fiscal
2year and for each fiscal year thereafter, all of the following apply:
3(a) (1) (A) The auditor shall reduce the total amount of ad
4valorem property tax revenue that is otherwise required to be
5allocated to a county’s Educational Revenue Augmentation Fund
6by the countywide vehicle license fee adjustment amount.
7(B) If, for the fiscal year, after complying with Section 97.68
8there is not enough ad valorem property tax revenue that is
9otherwise required to be allocated to a county Educational Revenue
10Augmentation Fund for the auditor to complete the allocation
11reduction required by subparagraph (A), the auditor shall
12additionally
reduce the total amount of ad valorem property tax
13revenue that is otherwise required to be allocated to all school
14districts and community college districts in the county for that
15fiscal year by an amount equal to the difference between the
16countywide vehicle license fee adjustment amount and the amount
17of ad valorem property tax revenue that is otherwise required to
18be allocated to the county Educational Revenue Augmentation
19Fund for that fiscal year. This reduction for each school district
20and community college district in the county shall be the percentage
21share of the total reduction that is equal to the proportion that the
22total amount of ad valorem property tax revenue that is otherwise
23required to be allocated to the school district or community college
24district bears to the total amount of ad valorem property tax revenue
25that is otherwise required to be allocated to all school districts and
26community college districts in a county. For purposes of this
27subparagraph, “school districts” and “community
college districts”
28do not include any districts that are excess tax school entities, as
29defined in Section 95.
30(2) The countywide vehicle license fee adjustment amount shall
31be allocated to the Vehicle License Fee Property Tax Compensation
32Fund that shall be established in the treasury of each county.
33(b) (1) The auditor shall allocate moneys in the Vehicle License
34Fee Property Tax Compensation Fund according to the following:
35(A) Each city in the county shall receive its vehicle license fee
36adjustment amount.
37(B) Each county and city and county shall receive its vehicle
38license fee adjustment amount.
P4 1(2) The auditor shall allocate one-half of the amount specified
2in
paragraph (1) on or before January 31 of each fiscal year, and
3the other one-half on or before May 31 of each fiscal year.
4(c) For purposes of this section, all of the following apply:
5(1) “Vehicle license fee adjustment amount” for a particular
6city, county, or a city and county means, subject to an adjustment
7under paragraph (2) and Section 97.71, all of the following:
8(A) For the 2004-05 fiscal year, an amount equal to the
9difference between the following two amounts:
10(i) The estimated total amount of revenue that would have been
11deposited to the credit of the Motor Vehicle License Fee Account
12in the Transportation Tax Fund, including any amounts that would
13have been certified to the Controller by the auditor of the County
14of Ventura under
subdivision (j) of Section 98.02, as that section
15read on January 1, 2004, for distribution under the law as it read
16on January 1, 2004, to the county, city and county, or city for the
172004-05 fiscal year if the fee otherwise due under the Vehicle
18License Fee Law (Part 5 (commencing with Section 10701) of
19Division 2) was 2 percent of the market value of a vehicle, as
20specified in Sections 10752 and 10752.1 as those sections read on
21January 1, 2004.
22(ii) The estimated total amount of revenue that is required to be
23distributed from the Motor Vehicle License Fee Account in the
24Transportation Tax Fund to the county, city and county, and each
25city in the county for the 2004-05 fiscal year under Section 11005,
26as that section read on the operative date of the act that amended
27this clause.
28(B) (i) Subject to an adjustment under clause (ii), for the
292005-06 fiscal
year, the sum of the following two amounts:
30(I) The difference between the following two amounts:
31(ia) The actual total amount of revenue that would have been
32deposited to the credit of the Motor Vehicle License Fee Account
33in the Transportation Tax Fund, including any amounts that would
34have been certified to the Controller by the auditor of the County
35of Ventura under subdivision (j) of Section 98.02, as that section
36read on January 1, 2004, for distribution under the law as it read
37on January 1, 2004, to the county, city and county, or city for the
382004-05 fiscal year if the fee otherwise due under the Vehicle
39License Fee Law (Part 5 (commencing with Section 10701) of
40Division 2) was 2 percent of the market value of a vehicle, as
P5 1specified in Sections 10752 and 10752.1 as those sections read on
2January 1, 2004.
3(ib) The actual total amount of revenue that was distributed
4from the Motor Vehicle License Fee Account in the Transportation
5Tax Fund to the county, city and county, and each city in the county
6for the 2004-05 fiscal year under Section 11005, as that section
7read on the operative date of the act that amended this
8subsubclause.
9(II) The product of the following two amounts:
10(ia) The amount described in subclause (I).
11(ib) The percentage change from the prior fiscal year to the
12current fiscal year in gross taxable assessed valuation within the
13jurisdiction of the entity, as reflected in the equalized assessment
14roll for those fiscal years. For the first fiscal year for which a
15change in a city’s jurisdictional boundaries first applies, the
16percentage change in gross taxable assessed valuation from the
17
prior fiscal year to the current fiscal year shall be calculated solely
18on the basis of the city’s previous jurisdictional boundaries, without
19regard to the change in that city’s jurisdictional boundaries. For
20each following fiscal year, the percentage change in gross taxable
21assessed valuation from the prior fiscal year to the current fiscal
22year shall be calculated on the basis of the city’s current
23jurisdictional boundaries.
24(ii) The amount described in clause (i) shall be adjusted as
25follows:
26(I) If the amount described in subclause (I) of clause (i) for a
27particular city, county, or city and county is greater than the amount
28described in subparagraph (A) for that city, county, or city and
29county, the amount described in clause (i) shall be increased by
30an amount equal to this difference.
31(II) If the amount
described in subclause (I) of clause (i) for a
32particular city, county, or city and county is less than the amount
33described in subparagraph (A) for that city, county, or city and
34county, the amount described in clause (i) shall be decreased by
35an amount equal to this difference.
36(C) For the 2006-07 fiscal year and for each fiscal year
37thereafter, the sum of the following two amounts:
38(i) The vehicle license fee adjustment amount for the prior fiscal
39year, if Section 97.71 and clause (ii) of subparagraph (B) did not
40apply for that fiscal year, for that city, county, and city and county.
P6 1(ii) The product of the following two amounts:
2(I) The amount described in clause (i).
3(II) The
percentage change from the prior fiscal year to the
4current fiscal year in gross taxable assessed valuation within the
5jurisdiction of the entity, as reflected in the equalized assessment
6roll for those fiscal years. For the first fiscal year for which a
7change in a city’s jurisdictional boundaries first applies, the
8percentage change in gross taxable assessed valuation from the
9prior fiscal year to the current fiscal year shall be calculated solely
10on the basis of the city’s previous jurisdictional boundaries, without
11regard to the change in that city’s jurisdictional boundaries. For
12each following fiscal year, the percentage change in gross taxable
13assessed valuation from the prior fiscal year to the current fiscal
14year shall be calculated on the basis of the city’s current
15jurisdictional boundaries.
16(2) Notwithstanding paragraph (1), “vehicle license fee
17adjustment amount,” for the 2014-15 fiscal year and each fiscal
18year thereafter, for a
city incorporating after January 1, 2004,begin insert and
19on or before January 1, 2012,end insert means the following:
20(A) For the 2014-15 fiscal year, or the first year of incorporation
21of the city, whichever is later, the quotient derived from the
22following fraction:
23(i) The numerator is the product of the following two amounts:
24(I) The sum of the most recent vehicle license fee adjustment
25amounts determined for all cities in the county.
26(II) The population of the incorporating city.
27(ii) The denominator is the sum of the populations of all cities
28in the county.
29(B) For the following fiscal year, and for each fiscal year
30thereafter, the sum of the following two amounts:
31(i) The vehicle license fee adjustment amount for the prior fiscal
32year.
33(ii) The product of the following two amounts:
34(I) The amount described in clause (i).
35(II) The percentage change from the prior fiscal year to the
36current fiscal year in gross taxable assessed valuation within the
37jurisdiction of the entity, as reflected in the equalized assessment
38roll for those fiscal years.
39(3) For the 2013-14 fiscal year, the vehicle license fee
40adjustment amount that is determined under subparagraph (C) of
P7 1paragraph (1) for
the County of Orange shall be increased by
2fifty-three million dollars ($53,000,000). For the 2014-15 fiscal
3year and each fiscal year thereafter, the calculation of the vehicle
4license fee adjustment amount for the County of Orange under
5subparagraph (C) of paragraph (1) shall be based on a prior fiscal
6year amount that reflects the full amount of this one-time increase
7of fifty-three million dollars ($53,000,000).
8(4) “Countywide vehicle license fee adjustment amount” means,
9for any fiscal year, the total sum of the amounts described in
10paragraphs (1), (2), and (3) for a county or city and county, and
11each city in the county.
12(5) On or before June 30 of each fiscal year, the auditor shall
13report to the Controller the vehicle license fee adjustment amount
14for the county and each city in the county for that fiscal year.
15(d) For the 2005-06 fiscal year and each fiscal year thereafter,
16the amounts determined under subdivision (a) of Section 96.1, or
17any successor to that provision, shall not reflect, for a preceding
18fiscal year, any portion of any allocation required by this section.
19(e) For purposes of Section 15 of Article XI of the California
20Constitution, the allocations from a Vehicle License Fee Property
21Tax Compensation Fund constitute successor taxes that are
22otherwise required to be allocated to counties and cities, and as
23successor taxes, the obligation to make those transfers as required
24by this section shall not be extinguished nor disregarded in any
25manner that adversely affects the security of, or the ability of, a
26county or city to pay the principal and interest on any debts or
27obligations that were funded or secured by that city’s or county’s
28allocated share of motor vehicle license fee revenues.
29(f) This section shall not be construed to do any of the following:
30(1) Reduce any allocations of excess, additional, or remaining
31funds that would otherwise have been allocated to county
32superintendents of schools, cities, counties, and cities and counties
33pursuant to clause (i) of subparagraph (B) of paragraph (4) of
34subdivision (d) of Sections 97.2 and 97.3 or Article 4 (commencing
35with Section 98) had this section not been enacted. The allocations
36required by this section shall be adjusted to comply with this
37paragraph.
38(2) Require an increased ad valorem property tax revenue
39allocation or increased tax increment allocation to a community
40redevelopment agency.
P8 1(3) Alter the manner in which ad valorem property tax revenue
2growth from fiscal year to
fiscal year is otherwise determined or
3allocated in a county.
4(4) Reduce ad valorem property tax revenue allocations required
5under Article 4 (commencing with Section 98).
6(g) Tax exchange or revenue sharing agreements, entered into
7prior to the operative date of this section, between local agencies
8or between local agencies and nonlocal agencies are deemed to be
9modified to account for the reduced vehicle license fee revenues
10resulting from the act that added this section. These agreements
11are modified in that these reduced revenues are, in kind and in lieu
12thereof, replaced with ad valorem property tax revenue from a
13Vehicle License Fee Property Tax Compensation Fund or an
14Educational Revenue Augmentation Fund.
If the Commission on State Mandates determines that
16this act contains costs mandated by the state, reimbursement to
17local agencies and school districts for those costs shall be made
18pursuant to Part 7 (commencing with Section 17500) of Division
194 of Title 2 of the Government Code.
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