BILL ANALYSIS
SB 636
Page 1
SENATE THIRD READING
SB 636 (Ashburn)
As Amended April 30, 2009
Majority vote
SENATE VOTE :38-0
LOCAL GOVERNMENT 7-0
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|Ayes:|Caballero, Knight, | | |
| |Arambula, Davis, Duvall, | | |
| |Krekorian, Skinner | | |
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SUMMARY : Allows Nevada County to redirect proceeds from an
increase in vehicle license fee (VLF) funds contained in the
February 2009 State Budget. Specifically, this bill :
1)States, for Nevada County, that additional revenue received
resulting from the increase in VLF enacted as a part of the
February 2009 State Budget is not revenue derived from taxes
imposed pursuant to the VLF statute, for purposes of a local
ordinance that governs the expenditure of VLF funds received.
2)Provides that the provisions of the bill will cease to exist
on July 1, 2011, unless certain conditions are met, which
would then extend the bill's provisions until July 1, 2013.
3)Specifies that the Legislature finds and declares that, due to
the unique circumstances relating to a local ordinance
governing the expenditure of VLF funds received by Nevada
County, a general statute cannot be made applicable; and,
declares that the provisions of this bill are only applicable
to Nevada County.
EXISTING LAW :
1)Provides for the imposition of an annual VLF for any vehicle
subject to registration in California in the amount of 0.65%
of the market value.
2)Provides, on or after May 19, 2009, for the VLF rate to be
increased temporarily to 1% for specified vehicles and
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requires that the revenues derived from the increase be
deposited into the General Fund (GF).
3)Provides, on or after May 19, 2009, for a temporary additional
0.15% increase in the VLF rate in addition to 1) and 2) above
to be deposited in the GF and transferred to the Local Safety
and Protection Account.
FISCAL EFFECT : None
COMMENTS : In lieu of a property tax on motor vehicles, the
state collects an annual VLF and allocates the revenues, minus
administrative costs, to cities and counties. The most recent
State Budget increased the VLF rate on most vehicles from 0.65%
to 1.15% of a vehicle's value
(AB 3 X3 (Evans), Chapter 18, Statutes of 2009-10 Third
Extraordinary Session). The increased rate took effect on May
19, 2009, and will cease on June 30, 2011.
In March of 1996, Nevada County voters approved Measure F, an
initiative which required that all funds received from the State
of California from VLF funds, as defined in the State
Constitution and in statute, must be segregated into a separate
accounting fund. The initiative required that Nevada County
must spend at least half of those funds in each fiscal year only
for public roads, ways, and highways for maintenance repair,
circulation enhancement, general road safety, and fire access in
the unincorporated portion of the county.
Nevada County officials believe that Measure F will require them
to make a general fund expenditure on roads in an amount equal
to half of the amount of additional VLF revenues that are
allocated to them for law enforcement purposes under the State
Budget, enacted in February of 2009. The author believes that
state law needs to be clarified to ensure that the additional
VLF revenues provided to Nevada County, under the recently
enacted Budget, do not constitute VLF funding for the purposes
of Nevada County's Measure F initiative.
This bill specifies that the provisions in the bill will sunset
on July 1, 2011, unless an amendment to the California
Constitution is approved at a statewide election held during the
2009 calendar year that limits the total amount that, under
Section 20 of Article XVI of the Constitution, may be
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transferred by statute from the Budget Stabilization Account, or
any successor to that account, to the GF. If such an amendment
were approved, the bill would sunset on July 1, 2013. It should
be noted that voters, during the May 19, 2009 special election,
did not approve the spending cap measure, which would have
allowed for the increased VLF rate to expire two years later in
July of 2013.
Analysis Prepared by : Debbie Michel / L. GOV. / (916)
319-3958
FN: 0001657