BILL ANALYSIS �
SENATE GOVERNANCE & FINANCE COMMITTEE
Senator Lois Wolk, Chair
BILL NO: AB 1112 HEARING: 9/12/13
AUTHOR: Ammiano FISCAL: No
VERSION: 9/11/13 TAX LEVY: No
CONSULTANT: Grinnell
SAN FRANCISCO COUNTY TRANSPORTATION AUTHORITY TAXES
Removes the cap on transactions and use taxes imposed by
the San Francisco County Transportation Authority
Background and Existing Law
Cities and counties can impose transactions and use taxes
in 0.125% increments as add-ons to the state sales tax,
provided that the combined rate of all transactions and use
taxes imposed in the county does not exceed 2% (SB 566,
Scott, 2003). To impose the tax, the local agency
governing board must approve an ordinance placing the tax
before voters, and then voters must approve the tax
according to the thresholds in the California Constitution,
which states that taxes levied by local governments are
either general taxes, subject to majority approval of its
voters, or special taxes, subject to 2/3 vote (Article XIII
C). SB 314 (Murray, 2003) and AB 2321 (Feuer, 2008)
authorized the Los Angeles County Metropolitan
Transportation Authority to levy its own one half of one
percent transactions and use tax not subject to the 2%
countywide cap
Created by the Bay Area County Traffic and Transportation
Funding Act, the San Francisco County Transportation
Authority (SFCTA) is led by the eleven members of the San
Francisco County Board of Supervisors. State law allows
the Authority to levy its own transactions and use tax of
one half of one percent or one percent to fund local
transportation projects, which it did when voters in the
City and County of San Francisco approved a one-half of one
percent transactions and use tax in 2003 (Proposition K).
However, the Act caps at 1% the combined rate of its tax
and any other transactions and use tax levied by any other
entity in the County; the Act predated SB 566, which didn't
increase the combined cap for SFCTA.
AB 1112 -- 00/00/11 -- Page 2
Proposed Law
Assembly Bill 1122 removes the 1% cap in the Act,
defaulting to the general 2% cap.
State Revenue Impact
No estimate.
Comments
1. Purpose of the bill . According to the author, "San
Francisco's unique geography and population have led to
some of the most intensive transportation needs in
California. At the same time, an archaic piece of code
limits the San Francisco County Transportation Authority's
ability to use sales tax revenue. While Revenue and
Taxation code allows an overall local sales tax cap of 2
percent, an older 1986 code limits the SFCTA under a cap
that is only 1 percent - half the revenue potential. That
restriction doesn't apply to other authorities. AB 1112
would simply remove one subsection of the outdated code, so
that SFCTA would have the same cap as other transportation
authorities. This does not raise any taxes, but merely
allows the authority to ask voters for approval of new tax
programs."
2. Bump it up . While eliminating an anachronistic
limitation on SFCTA's taxing authority, AB 1112 would allow
for a higher sales tax rate that the law currently
provides. However, SFCTA's board must approve the higher
tax, and then send it to voters for their approval.
3. Gut and amend . Prior to September 11, 2013, AB 1112
was a measure that required certain employment support
services provided by regional centers to be paid at the
same rates that the Department of Rehabilitation pays for
those services. Recent amendments removed those provisions
from the bill and inserted the measure's current contents.
Assembly Actions
AB 1112 -- 00/00/11 -- Page 3
Not relevant to this version of the bill.
Support and Opposition (9/12/13)
Support : City and County of San Francisco, San Francisco
County Transportation Authority.
Opposition : None received.