BILL ANALYSIS �
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Date of Hearing: July 6, 2011
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
ACA 4 (Blumenfield) - As Introduced: December 6, 2010
Policy Committee: Local Government Vote: 6-2
Urgency: No State Mandated Local Program: No
Reimbursable:
SUMMARY
This bill proposes amending the California Constitution to allow
a city, county or special district to incur bonded indebtedness
in order to fund specified public improvements and facilities,
with 55% voter approval (rather than two-thirds). Specifically,
this bill:
1)Lowers to 55% the voter-approval threshold for a city, county,
or city and county, to incur bonded indebtedness, in the form
of GO bonds for the construction, rehabilitation, or
replacement of specified infrastructure.
2)Allows a city, county, or city and county, or special district
that has incurred indebtedness in the form of general
obligation (GO) bonds for specified infrastructure approved by
55% of the voters within the jurisdiction to increase property
taxes above the existing constitutional limit to pay off the
principal and interest of the infrastructure GO bonds.
3)Defines the allowable infrastructure purposes to be any of the
following:
a) Public improvements, including, but not limited to,
improvements to transportation infrastructures, streets,
highways, sewer systems, water systems, wastewater systems
and park and recreation facilities.
b) Facilities or buildings used primarily to provide
sheriff, police or fire protection services to the public,
including the furnishing and equipping of those facilities
or buildings.
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FISCAL EFFECT
One-time GF costs of about $220,000 to include an analysis of
this measure, and arguments for and against the measure, in the
state voter pamphlet.
COMMENTS
1)Purpose . The author estimates California needs at least an
additional $500 billion by 2025 for maintenance, repair and
upkeep of the sewer and storm drain systems, streets and
sidewalks, police stations, jails, fire stations and
libraries. The author argues that because the state is not
meeting the infrastructure needs of our growing population,
there is great need for additional financial tools to make
these necessary investments, and, that these infrastructure
investments will enhance public safety, increase the value of
real estate and improve the quality of life in communities as
vital facilities will be better maintained to safely serve
today's population.
2)Background . Article XIIIA of the California Constitution
allows for bonded indebtedness by local governments. The
current threshold to pass general obligation bond measures for
cities, counties and special districts is a 2/3 vote.
However, a school district, community college district or
county office of education may fund the construction,
reconstruction, rehabilitation or replacement of school
facilities, including the furnishing and equipping of school
facilities, among other provisions, if approved by 55% of the
voters.
3)Previous legislation . ACA 9 (Huffman) of 2009 would have
created an additional exception to the 1% property tax limit
for a rate imposed by a city, county, city and county, or
special district to service bond-debt for specified public
improvements approved by 55% of the voters of the city,
county, city and county, or special district. This bill was
held on the Assembly floor. ACA 10 (Feuer), 2008, would have
created an additional exception to the 1% ad valorem property
tax for transportation general obligation bonds with 55% voter
approval. This bill was not heard in policy committee.
4)Support. The California Professional Firefighters contend
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that money invested in infrastructure creates an increase in
tax revenue that can be used to help local governments fund
police, fire, schools, and other core services.
5)Opposition. The California Taxpayers Association contend
creating another exception to Proposition 13's 1% limit on ad
valorem property taxes sets a bad precedent, thereby eroding
taxpayer protections.
Analysis Prepared by : Roger Dunstan / APPR. / (916) 319-2081