HomeMy WebLinkAboutReso 11-2003RESOLUTION NO. 11-2003
CITY COUNCIL, CITY OF SOUTH SAN FRANCISCO, STATE OF CALIFORNIA
A RESOLUTION URGING THE CALIFORNIA LEGISLATURE TO
REJECT THE GOVERNOR'S PROPOSED SHIFY OF LOCAL
VEHICLE LICENSE FEE REVENUES (VLF) AND TO HONOR THE
1998 COMMITMENT TO RESTORE THE VLF
WHEREAS, prior to 1935, cities and counties collected property taxes on motor vehicles
to fund essential local public health and safety services; and
WHEREAS, in 1935, the Legislature first enacted the Vehicle License Fee (VLF) Act,
replacing the property tax on vehicles with a 1.75 percent fee charged against the value of the
motor vehicle; and
WHEREAS, in 1948, the rate of the VLF was increased to 2 percent of the value of the
vehicle; and
WHEREAS, in 1986, the voters voted overwhelmingly to constitutionally dedicate the
proceeds of the VLF to fund city and county services; and
WHEREAS, in 1998, a period of strong economic growth, the Legislature approved the
use of a portion of the rapidly growing state General Fund to reduce the VLF payments of
vehicle owners. This amount, known as the "offset", grew in future years to a 67.5 percent offset
against the amount owed. The amount paid to local governments in lieu of the reduced VLF
payment is known as the "VLF backfill"; and
WHEREAS, the 1998 legislation and subsequent enactments contain clear provisions that
when insufficient funds are available to be transferred from the General Fund to fully fund the
offsets and backfill amount that the VLF offset shall be reduced and VLF payments increased;
and
WHEREAS, VLF and backfill revenues constitute 15 to 25 percent of typical city and
county general-purpose revenues. On the average, more than 60 percent of city general fund
spending and more than half of county general funds go to front line law enforcement, fire,
emergency medical services, and health care programs; and
WHEREAS, VLF and backfill revenues constitute 7 per cent of the City of South San
Francisco's General Fund revenues in 2002-03, making a critical contribution to the
approximately 49 per cent of the City General Fund operating budget that funds the Fire and
Police Departments; and
WHEREAS, revenues derived from the VLF and backfill are of critical importance in
funding vital local public health and safety services; and
WHEREAS, any failure by the Legislature to maintain the VLF backfill or restore the
VLF will cause widespread disruption in local government services essential to the well-being of
California citizens and their cities and counties; and
WHEREAS, Governor Davis' proposal to divert $4 billion in local VLF backfill
payments over the next 17 months fails to honor the 1998 commitment and is a direct assault on
local services that will be felt by every California resident; and
WHEREAS, shifting $4.2 billion in locally controlled revenues for local services is
neither equitable nor fair. No state program or department has been asked to shoulder such a
disproportionate share of the budget pain. These cuts come on top of the nearly $5 billion each
year that is transferred from local services to fund state obligations, which includes over $2
million which is estimated to be transferred from the City of South San Francisco's General
Fund to the State this year as part of the ERAF shift that began in the early 1990's.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of South San
Francisco that the City Council hereby approves that if the state General Fund can no longer
afford the expense of part or all of the VLF "backfill" that the Legislature and Governor of
California are hereby respectfully urged to implement the provisions of current law providing for
the reduction of the VLF offset in bad economic times and to restore the VLF in an amount
necessary to reduce the VLF backfill.
BE IT FURTHER RESOLVED, that the City Council of the City of South San Francisco
hereby expresses its profound appreciation to the legislators who support such VLF restoration
legislation.
I hereby certify that the foregoing Resolution was regularly introduced and adopted by
the City Council of the City of South San Francisco at a regular meeting held on the 22n°day of
January 2003 by the following vote:
AYES: Councilmembers Joseph A. Femekes, Richard A. Garbarino, Sr. and Raymond L.
Green, Mayor Pro Tem Karyl Matsumoto and Mayor Pedro Gonzalez
NOES: None.
ABSTAIN: None.
ABSENT: None.
ATTEST:
/~~ity Clerk