Election 2010: Proposition 22 – Should state be allowed to take money from local agencies?
October 5, 2010
NEVADA COUNTY, Calif. – State legislators have long had the power to dip into local government funds to close budget gaps during tough times.
Local jurisdictions that have lost money over the years are backing Proposition 22, which aims end the so-called raids.
“It’s a big burden on the quality of life,” said Nevada City Manager Gene Albaugh, who watched libraries, police and fire departments suffer after state take-backs. “We want to stop the raids of our local government fund. We want to control those locally.”
The state took $617,000 from Grass Valley’s Redevelopment Agency this summer, and the city will have to pay another $127,000 next year. Truckee paid $625,000 this year, and Placer County paid $3.2 million.
Grass Valley allots about $1.4 million annually into the RDA fund and uses it for neighborhood improvement projects such as the roundabout on East Main Street, street improvements and partnerships with groups such as Center for the Arts.
But opponents of Prop. 22 say the state needs the flexibility to dip into local funds, especially in a budget crisis, and argue the state programs at stake are more critical than redevelopment projects.
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About $1 billion hangs in the balance for fiscal year 2010-11, according to the nonpartisan Legislative Analyst’s Office. That money could be locked into local RDA and transportation funds if 22 passes, or dispersed through the state general fund if it fails.
“If Proposition 22 passes, our schools stand to lose over $1 billion immediately and an additional $400 million every year after that,” wrote the California Teachers Association. “At a time when our public schools are already suffering from crippling budget cuts, Proposition 22 would devastate them.”
Among 22’s opponents are a union of state-employed firefighters and the California Nurses Association; both say the proposition will bring more cuts to vital services provided by the state.
Money-shifting happens because state and local funds are intimately connected. Both levels of government share sales tax and fuel tax revenue, and they split the bill for programs such as health and social services.
While the state doesn’t collect property tax, it has the authority to redistribute that revenue.
In recent years, voters have limited the state’s authority to shift around local money; Prop. 22 is an even tighter restriction.