BILL ANALYSIS �
AB 1446
Page 1
Date of Hearing: May 9, 2012
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 1446 (Feuer) - As Amended: April 26, 2012
Policy Committee: Local
GovernmentVote:7-1
Transportation 11-1
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill allows the Los Angeles County Metropolitan
Transportation Authority (MTA), subject to voter approval, to
extend the existing 0.5% transactions and use tax for specified
purposes. Specifically, this bill:
1)Allows MTA to extend an existing transactions and use tax
approved by voters in 2008 indefinitely if approved by a
majority of the entire membership of MTA and two-thirds of the
voters.
2)Allows MTA to incur bonded indebtedness payable from the
proceeds of the tax extension, and specifies that proceeds
from the bonds must be used to accelerate completion of
capital projects and capital programs listed in existing law
for MTA.
3)Requires, upon completion of the projects identified in 2)
above, any remaining funds to be deposited in MTA's sales tax
revenue fund for projects and programs contained in the
expenditure plan or MTA's Long Range Transportation Plan
(LRTP).
FISCAL EFFECT
1)Increased revenues to the MTA if the tax is approved again by
MTA and the voters. The amount of new revenues should be
roughly similar to those raise by Measure R, the original
sales tax, which is expected to raise $40 billion over 30
years.
AB 1446
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2)Negligible direct state fiscal impact.
COMMENTS
1)Purpose. According to the author, this bill is intended to
give Los Angeles County voters the opportunity to extend the
duration of a local source of funding for an ambitious program
of transportation infrastructure projects that will transform
the Los Angeles region. The author states anticipated new
revenue can be used to pay for new bonds to build projects in
MTA's transportation plan sooner. The author notes efforts
are underway to obtain federal loans secured by Measure R
revenues to expedite construction of Measure R projects.
While these efforts may yet succeed, the author argues
additional Measure R revenues will be necessary to accelerate
Measure R projects to the maximum extent. The author notes
the bill does not change the project list already contained in
current law, and that all Measure R rail, highway, bus and
other projects will be accelerated at the same rate, without
prioritizing any one category.
2)Background . California's transactions and use tax law was
adopted in 1969 to authorize the adoption of local add-on
rates to the combined state and local sales tax rate. Over
the years, the law was amended to provide specific
authorizations for various particular cities, counties,
special districts and countywide authorities.
3)Previous legislation.
a) SB 314 (Murray), Chapter 785, Statutes of 2003, enacted
provisions that authorized MTA to impose a 0.5% sales tax,
for no more than six and one-half years, for specific
transportation projects and programs. The tax was never
imposed.
b) AB 2321 (Feuer), Chapter 302, Statutes of 2008,
authorized MTA to levy a -cent sales tax for 30 years,
subject to voter approval, and required the MTA to include
specified projects and programs in its long range
transportation plan. In November of 2008, more than 67%
of Los Angeles County voters approved this tax in a ballot
measure known as Measure R.
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4)Support. Supporters point to the Los Angeles Economic
Development Council estimate made in 2008 that Measure R
projects alone will create 166,000 jobs. They argue this bill
will help to expedite the building of transportation projects
in Los Angeles County.
5)Opposition arguments . The Howard Jarvis Taxpayers Association
has concerns about the bill's intent to use the revenue stream
for the purpose of incurring additional debt and believes that
the risks of getting money upfront to complete projects will
far outweigh the rewards.
Analysis Prepared by : Roger Dunstan / APPR. / (916) 319-2081