BILL ANALYSIS
ACA 10
Page 1
ASSEMBLY THIRD READING
ACA 10 (Torlakson)
As Introduced February 11, 2009
2/3 vote
REVENUE & TAXATION 5-3 APPROPRIATIONS 12-5
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|Ayes:|Charles Calderon, Beall, |Ayes:|De Leon, Ammiano, Charles |
| |Coto, Ma, Saldana | |Calderon, Davis, Fuentes, |
| | | |Hall, John A. Perez, Price, |
| | | |Skinner, Solorio, |
| | | |Torlakson, Krekorian |
| | | | |
|-----+--------------------------+-----+----------------------------|
|Nays:|DeVore, Harkey, Nielsen |Nays:|Nielsen, Duvall, Harkey, |
| | | |Miller, |
| | | |Audra Strickland |
| | | | |
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SUMMARY : Amends the California Constitution to lower the
constitutional vote requirement for approval of a special tax to
be levied by an education finance district from two-thirds to a
majority of the district voters. Specifically, this bill :
1)Modifies Section 2(d) of Article XIII C of the California
Constitution to authorize an education finance district,
formed pursuant to statute, to impose, extend, or increase a
special tax within its jurisdiction by a majority of the
voters voting on the proposition.
2)Specifies that a special tax imposed by an education finance
district is not deemed to have been increased if it is imposed
at a rate not higher than the maximum rate so approved.
3)Makes clarifying, non-substantive changes to Section 4 of
Article XIII A, Section 2 of Article XIII C, and Section 3 of
Article XIII D of the California Constitution.
EXISTING LAW :
1)Authorizes cities, counties, and special districts to impose a
general tax for general governmental purposes with the
approval of a majority of the voters.
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2)Prohibits special purpose districts and agencies, including
schools districts, from levying a general tax.
3)Authorizes cities, counties, and special districts to impose a
special tax for specified purposes with the approval of
two-thirds of the voters.
4)Does not allow cities, counties, or special districts to
impose an ad valorem tax on real property or a transactions
tax or sales tax on the sale of real property within that
city, county, or special district.
5)Allows school districts, community college districts, and
county offices of education to issue bonded indebtedness for
school facilities with 55% approval.
FISCAL EFFECT : According to the Assembly Appropriations
Committee:
1)Moderate General Fund costs of about $220,000 in fiscal year
2009-10 to the Secretary of State to place this measure in the
statewide election voter pamphlet. This estimate assumes
about four pages at $55,000 per page.
2)A potentially substantial education finance district special
tax revenue increase, to the extent that lowering the voter
approval threshold from two-thirds vote to a majority vote
results in the approval of more special tax measures.
COMMENTS : The author states that, "California's budget crisis
must be resolved without breaking the state's commitment to
education. Local revenue generation and local control for our
schools must be a component to how we get ourselves out of this
budget mess. The lower school bond threshold has been
instrumental in reviving California's school facilities. A
majority vote for local education finance districts promises to
similarly rebuild the education of our children."
The proponents argue that local communities should be able to
explore local resources to meet local priorities and that the
two-thirds vote requirement allows a minority of voters to
thwart the will of the majority. They assert that ACA 10, in
partnership with AB 267 (Torlakson), would give education
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finance districts the tools necessary to navigate these
uncertain economic times, by addressing their needs at the local
level and relying less on the timely passage of a state budget.
ACA 10 provides an important option for local schools and their
communities to work together to raise desperately needed
revenues by a simple majority of the voters, rather than the
current constitutional requirement of two-thirds vote. Further,
the proponents believe that ACA 10 presents an example of direct
democracy, in that it would give voters an opportunity to decide
the appropriate vote requirement for a special tax imposed by an
education finance district.
The opponents argue that the voters of California have clearly
stated that special taxes should only be approved by a
two-thirds vote and that ACA 10 runs counter to the expressed
views of Californians. The opponents are also concerned that
expanding the tax authority to education finance districts could
cause duplicative and/or increased taxation. The opponents
believe that a two-thirds vote requirement ensures that tax
increases are a last resort and argue that long-standing
taxpayer protections should not be thwarted based on the need
for revenue.
Committee staff notes all of the following:
1)Constitutional requirements for voter approval of local taxes
were initiated with the passage of Proposition 13 in 1978,
followed by Proposition 62, which was approved by voters in
1986. Proposition 62 guaranteed that all local tax increases
be approved by voters. After Proposition 62, local government
resorted to the use of fees and assessments, which did not
require voter approval, to fill the void. Ten years later, in
1996, the passage of Proposition 218 added Articles XIII C and
XIII D, providing voters with control over taxes regardless of
whether they were called assessments, fees, or charges.
Proposition 218 also included a provision requiring that
special taxes receive thirds approval of the electorate. In
2000, however, Proposition 39 provided a narrow exception to
the two-thirds vote requirement for special taxes by
authorizing the passage of local school construction bond
measures by approval of 55% of voters.
2)ACA 10 would amend the California Constitution to remove the
two-thirds vote requirement for special taxes imposed,
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extended, or increased by an education finance district, which
is being created by a companion measure, AB 267, and would
replace it with a majority vote requirement. The author
maintains that local school districts lost substantial control
over their own finances with the passage of Proposition 13 in
1978. The author argues that ACA 10 and AB 267, together,
would broaden opportunities for local school districts to
raise local revenues through a majority vote. According to Ed
Source, between 1983 and November 2006, voters voted on 414
parcel tax proposals. Out of 414 elections, voters approved
211 parcel taxes and 166 proposals received a majority vote
but not the necessary two-thirds vote approval. The author
asserts that, under a majority vote scenario, those 166
proposed taxes would have been approved, bringing the success
rate of local tax approval rate to over 90%.
3)If approved by the Legislature, this measure would appear on
the next statewide election ballot and, if approved, would
take effect as soon as the election results are certified.
4)The Committee heard ACA 10 and AB 267, a companion measure, at
its May 11, 2009 hearing. AB 267 authorizes an education
finance district, as defined, to impose a qualified special
tax within the district and passed out of this committee on a
6-3 vote. ACA 10 was adopted out of this committee on a 5-3
vote. If both this measure and AB 267 are enacted, and ACA 10
is approved by the voters, then an education finance district
would be able to levy qualified special taxes with only a
majority vote of its electorate. If only AB 267 is enacted,
then an education finance district would still be able to
impose those taxes but with a two-thirds vote of the
electorate.
Related legislation. SB 1430 (Torlakson), introduced in the
2007-08 legislative session, as amended on April 10, 2008, was
identical to this bill. Its companion measure, SCA 18
(Torlakson), also introduced in the 2007-08 legislative session,
would have reduced the vote threshold for special taxes levied
by an education finance district from two-thirds to a majority
of the electorate. Both SB 1430 and SCA 18 died in the Senate.
Analysis Prepared by : Oksana Jaffe / REV. & TAX. / (916)
319-2098
ACA 10
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