ELECTION: Localizing tax revenue control

by Staff

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By Stacey Oparnica, Staff Columnist

Proposition 22, if passed, would prohibit “the State, even during a period of severe fiscal hardship, from delaying the distribution of tax revenues for transportation, redevelopment, or local government projects and services.

“The State Constitution outlines that “state and local government funding and responsibilities are interrelated.” California shares certain tax revenues with San Diego, such as sales tax and gas taxes, but local areas and the state must split costs for various programs such as social services or health. The main dispute about Proposition 22 is how much control the state should have concerning local government property and fuel taxes. For example, San Diego collects property taxes but California has jurisdiction about how those revenues are to be distributed among local schools and agencies. Proposition 22 would prohibit California from, “Redirect(ing) redevelopment agency property taxes to any other local government, ‘nor’ temporarily shift property taxes from cities, counties, and special districts to schools.”

The state receives around $5.9 billion in fuel tax revenues annually, which goes toward constructing and maintaining streets and highways, funding transit and inter-city rail services and paying debt-service costs on voter-approved transportation bonds. State fuel tax revenues are typically supposed to be used for transportation purposes, but the state can also use this revenue to temporarily borrow money from state accounts, such as tax revenue, or utilize fuel tax revenue to help address budgetary problems during a fiscal crisis. Presently, around two-thirds of state fuel tax revenues are in the hands of the state while about 6 cents of the 18-cent tax is split between cities, counties and transit districts. This measure would limit the state’s authority to alter the way this revenue is distributed.

Similar to fuel taxes, the state uses property taxes as a way of sustaining

itself during a fiscal crisis, but it still must repay local agencies within three years, interest included. Proposition 22 would generally prohibit any state fund from borrowing fuel or property tax revenues, thus forcing the state to find alternative methods for balancing the budget and borrowing money.

Those in favor of Proposition 22 want to stop state politicians from taking local government funds and using gas taxes that are supposed to be allocated toward transportation. Supporters want protection of local services, such as emergency services, road repairs, transit, etc. Those against Proposition 22 feel that money used for fire services and natural disasters should be allocated toward public schools.

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