BILL ANALYSIS �
ACA 18
Page 1
Date of Hearing: May 9, 2012
ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT
Cameron Smyth, Chair
ACA 18 (Swanson) - As Amended: April 30, 2012
SUBJECT : Taxation: parcel tax.
SUMMARY : Allows a city, county, or special district to impose,
extend, or increase a parcel tax for the purpose of funding the
maintenance or improvement of fire protection or police
protection services with approval by a majority of voters in
that city, county, or special district. Specifically, this
bill :
1)Allows for the imposition, extension, or increase of a parcel
tax on real property by a city, county, or special district,
for the purpose of funding the maintenance or improvement of
fire protection services or police protection services, or
both, by approval of a majority of the voters in the city,
county, or special district voting on the proposition.
2)Defines "parcel tax" to mean a special tax imposed upon a
parcel of real property at a rate that is determined without
regard to that property's value.
3)Makes technical and conforming changes to other provisions in
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 voters.
2)Authorizes cities, counties, and special districts to impose a
special tax for specified purposes with the approval of
two-thirds of the voters.
3)Authorizes school districts, community college districts, or
county offices of education to incur school bonded
indebtedness with the approval of 55% of the voters voting on
the bond measure, requires bond proceeds only be used for
purposes specified in the Constitution, and requires an audit
to ensure that the funds have been expended only on the
ACA 18
Page 2
specific projects listed.
FISCAL EFFECT : None
COMMENTS :
1)Article XIII A of the California Constitution allows cities,
counties, and special districts, by a two-thirds vote of the
qualified electors in that jurisdiction, to impose special
taxes, except ad valorem taxes on real property or a
transaction tax or sales tax on the sale of real property
within that city, county or special district.
This bill allows, in spite of Article XIIIA, for the
imposition, extension, or increase of a parcel tax on real
property by a city or county, for the purpose of funding the
maintenance or improvement of fire protection services or
police protection services, or both, by approval
of a majority of the voters in the city or county voting on
the proposition. The bill defines a "parcel tax" to mean a
special tax that is imposed upon a parcel of real property at
a rate that is determined without regard to that property's
value, and makes other conforming changes to the California
Constitution. This bill is an author-sponsored measure.
2)A parcel tax is a particular type of excise tax that is based
on either a flat per-parcel rate or a rate that varies
depending upon use, size, and/or number of units on each
parcel. Proposition 13 contained a 1% limit on ad valorem
property tax; therefore, a parcel tax based upon the value of
property would constitute a violation of Proposition 13. The
California Constitution specifies that only two types of taxes
may be imposed upon a parcel of property: first, an ad
valorem property tax imposed pursuant to Article VIII and
Article XIIIA, and second, a special tax receiving two-thirds
voter approval pursuant to Section 4 of Article XIIIA. The
result is that a parcel tax must be adopted as a special tax.
3)The author notes that "since 2008, state and local governments
have faced multi-billion dollar budget shortfalls. Local
governments across the state have implemented cuts in
core-public services including public safety to accommodate
the falling revenues. As a result, firefighters and police
officers faced a record number of layoffs. Fire departments
are also increasingly relying on hiring freezes, reductions in
ACA 18
Page 3
salaries and benefits, and 'brown-outs,' a technique to
eliminate permanent personnel and replace them with relief or
overtime personnel. The risks posed by these cuts are passed
on to the citizens, who have seen an increase in response
time, fewer investigation and patrol units, and station
closures. ACA 18 allows local communities to impose a parcel
tax by a majority approval of the voters for the purpose of
funding, maintaining or improving fire and police services."
4)Lowering the constitutional vote threshold for special taxes
and bond indebtedness has been tried several times in past
years. ACA 7 (Nation) from the 2005-06 legislative session
would have lowered the constitutional vote requirement from
two-thirds to 55% for any special tax. ACA 10 (Feuer) of 2008
would have created an additional exception to the 1% ad
valorem property tax for transportation projects with 55%
voter approval. There were several measures introduced in the
2009-10 session that would have revised constitutional voting
thresholds for different purposes, including ACA 10
(Torlakson), ACA 15 (Arambula),
SCA 12 (Kehoe), ACA 9 (Huffman) and SCA 6 (Simitian), none of
which were enacted.
5)Support arguments : The Peace Officers Research Association of
California writes that "in these times of budget deficits,
layoffs, and cutbacks, we need all options on the table for
raising the funds necessary to keep our communities safe."
Opposition arguments : CalTax writes that "a two-thirds vote
requirement on taxes ensures that no group or individual
dominates quitter voices in a democracy?ACA 18 makes it easier
for individuals or groups to exert their political will over
the well-being of all individuals in a given jurisdiction."
6)This measure, a constitutional amendment, will require a
two-thirds vote of each house.
7)This bill is double-referred to the Assembly Revenue and
Taxation Committee.
REGISTERED SUPPORT / OPPOSITION :
Support
ACA 18
Page 4
Peace Officers Research Association of California (PORAC)
Councilmember Kriss Worthington, District 7, City of Berkeley
Individual letters (12)
Opposition
California Association of Realtors
CalTax
Howard Jarvis Taxpayers Association
Analysis Prepared by : Debbie Michel / L. GOV. / (916)
319-3958