HomeMy WebLinkAboutCC RESO 2003 - 18RESOLUTION NO. 2003 —18
RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF NATIONAL CITY
URGING THE CALIFORNIA LEGISLATURE TO
REJECT THE GOVERNOR'S PROPOSED SHIFT OF
LOCAL VLF REVENUES AND TO HONOR THE
1998 COMMITMENT TO RESTORE THE
VEHICLE LICENSE FEE (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 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, 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
Resolution No. 2003 - 18
January 21, 2003
Page Two
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.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of
National City, California, 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; and
BE IT FURTHER RESOLVED, that the City Council hereby expresses its
profound appreciation to the legislators who support such VLF restoration legislation.
PASSED and ADOPTED this 21st day of January, 2003.
Nick nza Mayor
ATTEST:
Michael R. Dalla, ity Clerk
APPROVED AS TO FORM:
George H. iser, III
City Attorney