BILL ANALYSIS                                                                                                                                                                                                    




                     SENATE GOVERNANCE & FINANCE COMMITTEE
                            Senator Lois Wolk, Chair
          

          BILL NO:  SB 1037                     HEARING:  5/7/14
          AUTHOR:  Hernandez                    FISCAL:  No
          VERSION:  5/1/14                      TAX LEVY:  No
          CONSULTANT:  Grinnell                 

            LOS ANGELES COUNTY METROPOLITAN TRANSPORTATION AUTHORTY
          

          Requires the Los Angeles Metropolitan Transportation  
          Authority to update specific items of information. 


                           Background and Existing Law  

          The California Constitution requires 2/3 voter approval  
          when a local agency wants to impose or increase a special  
          tax, or majority vote for a general tax (Proposition 13,  
          1978).  The Legislature must authorize special districts to  
          impose taxes because these agencies have no plenary taxing  
          powers.

          State law allows cities and counties to impose transactions  
          and use taxes, which are basically sales and use taxes, in  
          0.125% increments on top of the state's base rate if the  
          combined rate in the county doesn't exceed 2%.  County  
          boards of supervisors also can create a countywide  
          transportation authority to plan and fund transportation  
          projects within the county, and impose local transactions  
          and use taxes to pay for projects.  Counties that tax  
          themselves for transportation purposes call themselves  
          "self-help" counties because they have approved measures to  
          help themselves address their own transportation problems.   


          In rare cases, the Legislature allows local agencies to  
          exceed the 2% cap.  The Los Angeles County Metropolitan  
          Transportation Authority (MTA) had authority to levy a  
          half-cent transaction and use tax not subject to the 2%  
          countywide cap for six and a half years (SB 314, Murray,  
          2003).  However, MTA didn't put the measure authorized by  
          that bill to the voters.  In 2008, the Legislature  
          reauthorized MTA to place the half-cent transactions and  
          use tax for 30 years not subject to the cap; however, the  
          measure required MTA to adopt an expenditure plan prior to  




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          submitting the ordinance to the voters (AB 2321, Feuer,  
          2008).  In November, 2008, Los Angeles County voters  
          approved the tax measure, Measure R.  

          Two years ago, the Legislature authorized MTA to impose a  
          permanent transactions and use tax (AB 1446, Feuer, 2012).   
          That measure required MTA to update its expenditure plan  
          prior to submitting the ordinance to the voters.  However,  
          Los Angeles County voters didn't approve that tax.  


                                   Proposed Law
                                         
          Senate Bill 1037 provides that if MTA again places a  
          transactions and use tax on the ballot, it must update and  
          amend the expenditure plan to list:
                 Cost estimates for each project and program, using  
               a transparent process,
                 Accelerated costs of each of the plan's projects  
               and programs, if applicable,
                 A schedule for when MTA anticipates funds will be  
               available for each project and program, 
                 Expected completion dates for each project and  
               program.

          Additionally, the measure requires the revised and updated  
          Long Range Transportation Plan to include the expenditure  
          plan before placing the measure on the ballot.  The Long  
          Range Transportation Plan also must list capital projects  
          and programs adopted by each subregion that are submitted  
          to MTA for inclusion.  The bill also notes that including  
          cost estimates doesn't mean the project is guaranteed  
          funding.


                               State Revenue Impact
           
          No estimate.


                                     Comment 

           Purpose of the bill  .  According to the author, "Los Angeles  
          County voters are subjected to some of the worst traffic in  
          the nation.  To help address the problem, they are willing  
          to pass taxes upon themselves, such as Measure R in 2008.   





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          Voters deserve to know where their tax dollars are being  
          spent, and how far they go in contributing towards the  
          various transportation projects in the county.  SB 1037  
          will give voters comprehensive information on where their  
          tax money will go; how much and to what project; any  
          outstanding funding needs; and most importantly, will  
          solicit current figures on exact project outlays, prior to  
          any vote on extending taxes or approving new ones.  This is  
          accomplished by requiring Metro to update its long range  
          transportation plan and Measure R expenditure plan, with  
          specified categories of information in conjunction with the  
          region's planning entities."







































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                        Support and Opposition  (04/30/14)

           Support  :  None received.

           Opposition  :  None received.