BILL ANALYSIS Ó
AB 338
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Date of Hearing: May 6, 2015
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Jimmy Gomez, Chair
AB
338 (Roger Hernández) - As Amended April 13, 2015
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| |Transportation | |11 - 5 |
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill authorizes the Los Angeles County Metropolitan
Transportation Authority (MTA), subject to voter approval, to
impose an additional 0.5% transactions and use tax (sales tax)
for no more than 30 years, for funding transportation-related
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projects and programs.
FISCAL EFFECT:
Negligible state fiscal impact.
According to the State Board of Equalization (BOE) a new 0.5%
district tax in LA County would raise approximately $8 million
in the first full year of implementation.
COMMENTS:
1)Purpose. According to the author, "While Los Angeles continues
to experience some of the most challenging traffic congestion
in the state and nation, Los Angeles voters have also
recognized the importance of investing in a transportation
network that is responsive to the needs to commuters, transit
users, and that facilitates the movement of goods in the
region. Most importantly, Los Angeles voters have responded
to an expenditure plan that can demonstrate fairness in the
distribution of investments throughout the region. AB 338
provides an approach to bring additional resources to Los
Angeles County predicated on fairness, transparency and
acknowledgement of best practices."
2)Background. The Transactions and Use Tax law authorizes the
adoption of local add-on rates to the combined state and local
sales tax rate. The law has been amended multiple times to
authorize specific cities, counties, special districts, and
county transportation authorities to impose a sales tax,
subject to two-thirds voter approval. Existing law caps the
combined rate of all sales taxes in a county at 2% but
provides several exemptions to the cap, including to several
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counties to allow an additional sales tax for transportation
purposes.
According to the Board of Equalization, Los Angeles County has
14 sales taxes, including three county-wide taxes for
transportation purposes and 11 city-wide taxes. Despite the
statutory exemption for Measure R, the County has reached the
2% cap. Measure R, in addition to Measure C (1990) and
Proposition A (1980), which were both imposed indefinitely,
are the three one half-cent county-wide sales taxes that
provide the majority of MTA's funding.
3)Related legislation:
a) SB 767 (De León) also authorizes MTA to impose an
additional countywide 0.5% transactions and use tax, but is
not identical to this bill. SB 767 is pending in the
Senate Appropriations Committee.
b) AB 464 (Mullin) raises the transactions and use tax rate
cap from 2% to 3%. AB 464 is pending on the Assembly
Floor.
1)Prior legislation:
a) SB 1037 (Hernández), Chapter 196, Statutes of 2014,
required MTA to update its expenditure plan and Long-Range
Transportation Plan before placing another sales tax
measure before the voters.
b) AB 1446 (Feuer), Chapter 806, Statutes of 2012,
authorized MTA, subject to voter approval, to extend the
existing sales tax (Measure R) indefinitely. AB 1446 also
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required MTA to update its expenditure plan prior to
submitting the tax measure to the voters. The measure was
put before Los Angeles County voters in November 2012 but
failed to achieve the two-thirds threshold necessary for
passage.
c) AB 2321 (Feuer), Chapter 302, Statutes of 2008,
authorized MTA to impose, subject to voter approval, a 0.5%
sales tax for 30 years and required MTA to include
specified projects and programs in its long-range
transportation plan. In November of 2008, more than 67% of
Los Angeles County voters approved this tax in a ballot
measure known as Measure R.
d) SB 314 (Murray), Chapter 785, Statutes of 2003,
authorized MTA to impose, subject to voter approval, a 0.5%
sales tax for no more than six and one-half years for
specific transportation projects and programs. That sales
tax was never imposed.
Analysis Prepared by:Jennifer Swenson / APPR. / (916)
319-2081
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