Recommendations
March 25, 1998
I. ERAF issues.
B. Begin return of funds diverted along the lines suggested by AB 95 which was approved by the State Legislature and vetoed by the Governor. Key items in the legislation include a formula for the gradual return of ERAF funds to localities and provisions to allow local control and accountability.
C. In many communities this could immediately result in the reduction of utility user taxes or other locally generated revenues.
II. Add incentives for local governments to encourage high paying & high skilled business growth which seek to expand the tax base.
B. Examine a program to encourage open space/farmland in exchange for higher density on other land.
III. Evaluate legislative opportunities to enact provisions contained in the proposed constitutional amendment of the League of California Cities.
IV. Create a true point of sale tax system that would generate revenue for the jurisdiction most affected by the activity taxed, as is currently done with retail sales and the automobile gas tax (e.g., car leasing, aviation fuel, etc.)
V. Transportation funding. Reverse SB 45, which allows MTA to distribute transportation funds. This will eliminate the strong fear that these funds will not go back to local communities where gas tax revenues were generated.
VI. Change the formula for allocation of gas tax from the current system which computes the tax based on a percentage of the volume sold and shift it to a system which allows for a cost of living increase. This can be done either through adjusting the current formulas to include a cost of living adjustment or through one which calculates the percentage based on the price of gasoline/diesel sold at the point of sale. Current formulas have not been changed since 1990.
Metropolitan Forum Project
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