BILL ANALYSIS                                                                                                                                                                                                    Ó






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          |SENATE RULES COMMITTEE            |                       AB 1665|
          |Office of Senate Floor Analyses   |                              |
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                                   THIRD READING 


          Bill No:  AB 1665
          Author:   Bonilla (D) and Frazier (D), et al.
          Amended:  5/9/16 in Assembly
          Vote:     27 - Urgency

           SENATE TRANS. & HOUSING COMMITTEE:  11-0, 6/14/16
           AYES:  Beall, Cannella, Allen, Bates, Gaines, Galgiani, Leyva,  
            McGuire, Mendoza, Roth, Wieckowski

           SENATE GOVERNANCE & FIN. COMMITTEE:  6-0, 6/22/16
           AYES:  Hertzberg, Nguyen, Beall, Hernandez, Moorlach, Pavley
           NO VOTE RECORDED:  Lara

           ASSEMBLY FLOOR:  77-0, 5/16/16 - See last page for vote

           SUBJECT:   Transactions and use taxes:  County of Alameda,  
                     County of Contra Costa, and Contra Costa  
                     Transportation Authority


          SOURCE:    Author


          DIGEST:  This bill removes the existing authority granted to  
          Alameda County and Contra Costa County to impose an additional  
          transaction and use tax (TUT), subject to voter approval, and  
          instead grants Contra Costa County's existing authority to the  
          Contra Costa Transportation Authority (CCTA).


          ANALYSIS: 

          Existing law:








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          1)Authorizes cities and counties to impose a local sales and use  
            tax.


          2)Authorizes cities and counties to impose transactions and use  
            taxes.


          3)Prohibits, in any county, the combined rate of all taxes  
            imposed in accordance with TUT Law from exceeding 2%. 


          4)Authorizes Alameda County and Contra Costa County to adopt an  
            ordinance imposing a TUT not to exceed 0.5% for the support of  
            countywide transportation programs at a rate that would, in  
            combination with all other transaction and use taxes, exceed  
            the 2% limit established in existing law, if all the following  
            conditions are met:


             a)   The local government entity adopts an ordinance  
               proposing the TUT by any applicable voting requirements


             b)   The ordinance proposing the TUT is submitted to the  
               electorate and is approved by two-thirds of the voters  
               voting on the ordinance


             c)   The TUT conforms to the Transaction and Use Tax Law


          5)Provides that the authority for Alameda County and Contra  
            Costa County to adopt an ordinance to impose a TUT that  
            exceeds the combined statutory rate of 2% shall only remain in  
            effect until December 31, 2020.  


          This bill:

          1)Removes the existing authority granted to Alameda County and  
            Contra Costa County, and instead authorizes the CCTA to adopt  
            an ordinance to impose a TUT, subject to voter approval, that  







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            exceeds the combined statutory rate of 2% until December 31,  
            2020.    


          2)Provides, notwithstanding any other law, any ordinance  
            previously adopted under the authority in existing law for  
            Alameda and Contra Costa Counties to adopt an additional TUT,  
            subject to voter approval, and in effect on January 1, 2016,  
            may continue in effect.  


          3)Contains an urgency clause and states it is necessary that  
            this bill take effect immediately in order to ensure the  
            residents of Contra Costa County have adequate transportation  
            services.  


          4)Finds and declares that a special law is necessary because of  
            the unique fiscal pressures experienced in Alameda County and  
            CCTA in providing essential transportation programs.  





          Comments
          
         1)Purpose. The author asserts, "in light of the severe state  
           funding shortfall for transportation, it is imperative that  
           local governments, agencies and their constituents have the  
           ability to generate additional funding to plan and bring forth  
           critical transportation projects.  AB 1665 will streamline this  
           process, making local governments more efficient so voters can  
           weigh in on the transportation issues of the county.  Simply  
           put, this bill will allow CCTA to continue the great work they  
           have been known to accomplish, while meeting the precise needs  
           of Contra Costa County and its residents."

         2)Agency streamlining. This bill proposes to shift the  
           authorization to impose TUT from Contra Costa County to CCTA,  
           similar to authorization granted to transportation authorities  
           on behalf of other counties.  The CCTA was formed by voters in  
           1988 to lead Contra Costa County's transportation efforts and  
           manage funds generated by Measure C, a 0.50% TUT approved by  







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           voters that same year for transportation purposes.  The CCTA  
           also manages funds generated by Measure J, approved by Contra  
           Costa County voters in November 2004, to extend the TUT for  
           another 30 years.  


          Presently, CCTA is moving forward with proposing a  
          transportation tax measure to county voters, but cannot do so  
          directly under current law - instead Contra Costa County must  
          first adopt an ordinance to present a tax to voters and then  
          work with the State Board of Equalization to delegate  
          administrative responsibilities from the county to CCTA.  This  
          bill transfers the authority to seek TUT voter approval to the  
          local jurisdiction that would ultimately administer the tax  
          proceeds if approved by two-thirds of voters: CCTA.  Since plans  
          to ask Contra Costa County voters for a new tax are already  
          under way, the author has included an urgency measure in this  
          bill to ensure state law is enacted in time to allow CCTA to  
          propose its TUT measure to its voters. 


         3)Existing authority. While this bill streamlines TUT taxing  
           authority for Contra Costa County, this bill also includes a  
           provision to guarantee existing taxing authority in Alameda  
           County (i.e., Measure BB, enacted in 2014) is not jeopardized  
           with this streamlining process.  




          FISCAL EFFECT:   Appropriation:    No          Fiscal  
          Com.:NoLocal:    No


          SUPPORT:   (Verified6/24/16)


          Bay Area Council
          Contra Costa County Board of Supervisors
          Contra Costa Transportation Authority 
          California-Nevada Conference of Operating Engineers
          San Francisco Bay Area Rapid Transit District









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          OPPOSITION:   (Verified6/24/16)


          None received

          ASSEMBLY FLOOR:  77-0, 5/16/16
          AYES:  Achadjian, Alejo, Arambula, Atkins, Baker, Bigelow,  
            Bloom, Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos,  
            Chang, Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dahle, Daly,  
            Dodd, Eggman, Frazier, Beth Gaines, Cristina Garcia, Eduardo  
            Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Grove,  
            Hadley, Harper, Roger Hernández, Holden, Irwin, Jones,  
            Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low,  
            Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin,  
            Nazarian, Obernolte, O'Donnell, Olsen, Patterson, Quirk,  
            Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark  
            Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams,  
            Wood, Rendon
          NO VOTE RECORDED:  Travis Allen, Dababneh, Gallagher

          Prepared by:Manny Leon / T. & H. / (916) 651-4121
          6/24/16 14:33:49


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