BILL NUMBER: AB 1849 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY APRIL 5, 2010
INTRODUCED BY Assembly Member Norby
FEBRUARY 12, 2010
An act to amend Section 96.15 of the Revenue and Taxation
Code, relating to local government finance. An act to
amend Sec tion 42238 of the Education Code, and to add
Section 97.81 to the Revenue and Taxation Code, relating to local
government finance.
LEGISLATIVE COUNSEL'S DIGEST
AB 1849, as amended, Norby. Local government finance .
: cities: school districts: exchange revenue.
Existing property tax law generally requires the county
auditor, in each fiscal year, to allocate property tax revenues to
local jurisdictions in accordance with specified formulas and
procedures, and generally requires that each jurisdiction 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 a county auditor to make certain property tax revenue
allocations to qualifying cities, as defined, in accordance with a
specified Tax Equity Allocation (TEA) formula and to make
corresponding reductions in the amount of property tax revenue that
is allocated to the county. Existing law also requires the county
auditor, in the case in which a qualifying city becomes the successor
agency to a special district as a result of a merger with that
district as described in a specified statute, to additionally
allocate to that successor qualifying city that amount of property
tax revenue that otherwise would have been allocated to that special
district pursuant to general allocation requirements.
This bill would make a technical, nonsubstantive change
to the provision pertaining to property tax revenue allocations to a
qualifying city that merges with a special district ,
for the 2011-12 fiscal year and for each fiscal year thereafter,
authorize a city to elect to exchange amounts of its general funds
equal to the city exchange amount, as defined, for the ad valorem
property tax revenues of the school districts located within that
city. This bill would require the auditor of the county in which a
city that makes this election is located to perform specified duties
with respect to the allocation of ad valorem property tax
revenues and transfers from the city's general fund to school
districts of the city exchange amount. This bill would also require a
city that makes this election to report specified information to the
auditor in order to assist the auditor in determining the city
exchange amount for purposes of making the allocations and transfers
specified above . By imposing new duties upon county
auditors, this bill would impose a state-mandated local program.
Existing law requires the county superintendent of schools to
determine a revenue limit for each school district in the county and
requires the amount apportioned to each school district to not
include the sum of specified amounts.
This bill would include within the sum not apportioned to each
school district amounts, if any, received by each school district
from a city's general fund as a result of the exchange of revenues
described above.
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: no
yes . State-mandated local program: no
yes .
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 42238 of the
Education Code is amended to read:
42238. (a) For the 1984-85 fiscal year and each fiscal year
thereafter, the county superintendent of schools shall determine a
revenue limit for each school district in the county pursuant to this
section.
(b) The base revenue limit for a fiscal year shall be determined
by adding to the base revenue limit for the prior fiscal year the
following amounts:
(1) The inflation adjustment specified in Section 42238.1.
(2) For the 1995-96 fiscal year, the equalization adjustment
specified in Section 42238.4.
(3) For the 1996-97 fiscal year, the equalization adjustments
specified in Sections 42238.41, 42238.42, and 42238.43.
(4) For the 1985-86 fiscal year, the amount received per unit of
average daily attendance in the 1984-85 fiscal year pursuant to
Section 42238.7.
(5) For the 1985-86, 1986-87, and 1987-88 fiscal years, the amount
per unit of average daily attendance received in the prior fiscal
year pursuant to Section 42238.8.
(6) For the 2004-05 fiscal year, the equalization adjustment
specified in Section 42238.44.
(7) For the 2006-07 fiscal year, the equalization adjustment
specified in Section 42238.48.
(8) For the 2011-12 fiscal year, the equalization adjustment
specified in Section 42238.49.
(c) (1) (A) For the 2010-11 fiscal year, the Superintendent shall
compute an add-on for each school district by adding the inflation
adjustment specified in Section 42238.1 to the adjustment specified
in Section 42238.485.
(B) For the 2011-12 fiscal year and each fiscal year thereafter,
the Superintendent shall compute an add-on for each school district
by adding the inflation adjustment specified in Section 42238.1 to
the amount computed pursuant to this paragraph for the prior fiscal
year.
(2) Commencing with the 2010-11 fiscal year, the Superintendent
shall compute an add-on for each school district by dividing each
school district's fiscal year average daily attendance computed
pursuant to Section 42238.5 by the total adjustments in funding for
each district made for the 2007-08 fiscal year pursuant to Section
42238.22 as it read on January 1, 2009.
(d) The sum of the base revenue limit computed pursuant to
subdivision (b) and the add-on computed pursuant to subdivision (c)
shall be multiplied by the district average daily attendance computed
pursuant to Section 42238.5.
(e) For districts electing to compute units of average daily
attendance pursuant to paragraph (2) of subdivision (a) of Section
42238.5, the amount computed pursuant to Article 4 (commencing with
Section 42280) shall be added to the amount computed in subdivision
(c) or (d), as appropriate.
(f) For the 1984-85 fiscal year only, the county superintendent
shall reduce the total revenue limit computed in this section by the
amount of the decreased employer contributions to the Public
Employees' Retirement System resulting from enactment of Chapter 330
of the Statutes of 1982, offset by any increase in those
contributions, as of the 1983-84 fiscal year, resulting from
subsequent changes in employer contribution rates.
(g) The reduction required by subdivision (f) shall be calculated
as follows:
(1) Determine the amount of employer contributions that would have
been made in the 1983-84 fiscal year if the applicable Public
Employees' Retirement System employer contribution rate in effect
immediately prior to the enactment of Chapter 330 of the Statutes of
1982 was in effect during the 1983-84 fiscal year.
(2) Subtract from the amount determined in paragraph (1) the
greater of subparagraph (A) or (B):
(A) The amount of employer contributions that would have been made
in the 1983-84 fiscal year if the applicable Public Employees'
Retirement System employer contribution rate in effect immediately
after the enactment of Chapter 330 of the Statutes of 1982 was in
effect during the 1983-84 fiscal year.
(B) The actual amount of employer contributions made to the Public
Employees' Retirement System in the 1983-84 fiscal year.
(3) For purposes of this subdivision, employer contributions to
the Public Employees' Retirement System for either of the following
shall be excluded from the calculation specified above:
(A) Positions supported totally by federal funds that were subject
to supplanting restrictions.
(B) Positions supported, to the extent of employer contributions
not exceeding twenty-five thousand dollars ($25,000) by a single
educational agency, from a revenue source determined on the basis of
equity to be properly excludable from the provisions of this
subdivision by the Superintendent with the approval of the Director
of Finance.
(4) For accounting purposes, the reduction made by this
subdivision may be reflected as an expenditure from appropriate
sources of revenue as directed by the Superintendent.
(h) The Superintendent shall apportion to each school district the
amount determined in this section less the sum of:
(1) The district's property tax revenue received pursuant to
Chapter 3 (commencing with Section 75) and Chapter 6 (commencing with
Section 95) of Part 0.5 of Division 1 of the Revenue and Taxation
Code.
(2) The amount, if any, received pursuant to Part 18.5 (commencing
with Section 38101) of Division 1 of the Revenue and Taxation Code.
(3) The amount, if any, received pursuant to Chapter 3 (commencing
with Section 16140) of Division 4 of Title 2 of the Government Code.
(4) Prior years' taxes and taxes on the unsecured roll.
(5) Fifty percent of the amount received pursuant to Section
41603.
(6) The amount, if any, received pursuant to the Community
Redevelopment Law (Part 1 (commencing with Section 33000) of Division
24 of the Health and Safety Code), except for any amount received
pursuant to Section 33401 or 33676 of the Health and Safety Code that
is used for land acquisition, facility construction, reconstruction,
or remodeling, or deferred maintenance, except for any amount
received pursuant to Section 33492.15 of, paragraph (4) of
subdivision (a) of Section 33607.5 of, or Section 33607.7 of, the
Health and Safety Code that is allocated exclusively for educational
facilities.
(7) For a unified school district, other than a unified school
district that has converted all of its schools to charter status
pursuant to Section 47606, the amount of statewide average
general-purpose funding per unit of average daily attendance received
by school districts for each of four grade level ranges, as computed
by the department pursuant to Section 47633, multiplied by the
average daily attendance, in corresponding grade level ranges, of any
pupils who attend charter schools funded pursuant to Chapter 6
(commencing with Section 47630) of Part 26.8 of Division 4 for which
the district is the sponsoring local educational agency, as defined
in Section 47632, and who reside in and would otherwise have been
eligible to attend a noncharter school of the district.
(8) The amount, if any, received pursuant to Section 97.81 of the
Revenue and Taxation Code.
(i) A transfer of pupils of grades 7 and 8 between an elementary
school district and a high school district shall not result in the
receiving district receiving a revenue limit apportionment for those
pupils that exceeds 105 percent of the statewide average revenue
limit for the type and size of the receiving school district.
SEC. 2. Section 97.81 is added to the
Revenue and Taxation Code , to read:
97.81. (a) (1) Notwithstanding any other law, for the 2011-12
fiscal year and each fiscal year thereafter, a city may elect to
exchange amounts of its general funds equal to the city exchange
amount specified in either paragraph (1) or (2) of subdivision (e),
for the ad valorem property tax revenues of the school districts
located within that city.
(2) A city that makes an election pursuant to paragraph (1) shall
be required to exchange revenues as provided by this section in the
fiscal year in which the election is made and in each of the next
four following fiscal years.
(b) If an election is made under subdivision (a), the auditor of
the county in which the city is located shall do both of the
following:
(1) For the first fiscal year for which a city elects to exchange
revenues pursuant to this section, the auditor shall do all of the
following:
(A) Increase the total amount of ad valorem property tax revenue
that is otherwise required to be allocated to the city that makes an
election pursuant to subdivision (a) by the city equity amount.
(B) (i) Decrease the total amount of ad valorem property tax
revenue that is otherwise required to be allocated to all school
districts located within the city that makes an election pursuant to
subdivision (a) by the city exchange amount.
(ii) This reduction for each school district shall be the
percentage share of the total reduction that is equal to the
proportion that the total amount of ad valorem tax revenue that is
otherwise required to be allocated to the school district bears to
the total amount of ad valorem property tax that is otherwise
required to be allocated to all school districts located within the
city that makes an election pursuant to subdivision (a).
(C) Transfer from the general fund of the city that makes an
election pursuant to subdivision (a) to all school districts located
within that city amounts equal to the total amount of the reduction
for each school district determined in clause (ii) of subparagraph
(B).
(2) For the fiscal year next following the fiscal year for which
revenues are first exchanged, and for each of the next three
following fiscal years, the auditor shall do both of the following:
(A) Incorporate the allocation adjustments made by subparagraphs
(A) and (B) of paragraph (1) of subdivision (b) into the ad valorem
property tax revenue apportionments made pursuant to Sections 96.1
and 96.5.
(B) (i) Transfer from the general fund of the city that makes an
election pursuant to subdivision (a) to each school district located
within that city a proportionate share of the city exchange amount
received by that city during each fiscal year.
(ii) A school district's proportionate share of the city exchange
amount shall be equal to the proportion that the total amount of ad
valorem tax revenue that is otherwise required to be allocated to the
school district bears to the total amount of ad valorem property tax
that is otherwise required to be allocated to all school districts
located within the city that makes an election pursuant to
subdivision (a).
(iii) The transfer required by this subparagraph to all school
districts shall be made at the same time that ad valorem property tax
revenues are apportioned by the auditor. The electing city and each
school district shall cooperate with the auditor in implementing this
subparagraph.
(d) (1) A city that makes an election pursuant to subdivision (a)
shall, during each fiscal year that an exchange is required by this
section, report to the auditor of the county in which the city is
located, within 15 days of the receipt of tax revenues under the
Bradley-Burns Uniform Local Sales and Use Tax Law, both of the
following:
(A) The date on which the city received the tax revenues under the
Bradley-Burns Uniform Local Sales and Use Tax Law.
(B) The amount of tax revenues received by the city under the
Bradley-Burns Uniform Local Sales and Use Tax Law.
(2) The auditor shall use the information reported by the city
pursuant to this section to determine the city exchange amount for
purposes of making the allocations and transfers required by
subdivision (b).
(e) For purposes of this section, "city exchange amount" means,
with respect to a city that makes an election pursuant to subdivision
(a), on amounts of its general funds that, at the election of the
city, is equal to either of the following:
(1) One-half of the amount of tax revenues transmitted to the city
under the Bradley-Burns Uniform Local Sales and Use Tax Law.
(2) The entire amount of tax revenues transmitted to the city
under the Bradley-Burns Uniform Local Sales and Use Tax Law.
SEC. 2. If the Commission on State Mandates
determines that this act contains costs mandated by the state,
reimbursement to local agencies and school districts for those costs
shall be made pursuant to Part 7 (commencing with Section 17500) of
Division 4 of Title 2 of the Government Code.
SECTION 1. Section 96.15 of the Revenue and
Taxation Code is amended to read:
96.15. (a) Notwithstanding any other provision of this chapter,
in the event a qualifying city as defined in subdivision (d) of
Section 98 or subdivision (f) of Section 98.02 becomes the successor
agency to a special district as a result of a merger described in
Section 57087.3 of the Government Code, the auditor shall allocate to
that qualifying city, in addition to any other amount of ad valorem
property tax revenue required to be allocated to that city pursuant
to this chapter, the amount of ad valorem property tax revenue that
otherwise would be allocated to that district pursuant to this
article.
(b) It is the intent of the Legislature in enacting this section
to confirm a county auditor's duty and authority, established by
subdivision (d) of Section 57087.3 of the Government Code, to
allocate to a qualifying city the ad valorem property tax revenue of
a subsidiary district that has been merged with the city.