Res 03-007RESOLUTION NO. 03-007
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF POWAY, CALIFORNIA,
URGING THE CALIFORNIA LEGISLATURE TO REJECT THE GOVERNOR'S
PROPOSED SHIFT OF LOCAL VEHICLE LICENSE FEE REVENUES AND TO
HONOR THE 1998 COMMITMENT TO RESTORE THE VEHICLE LICENSE FEE
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, $2.66 million in VLF and backfill revenue constitutes 9.6% of the
City of Poway's General Fund receipts; and
WHEREAS, 46% of Poway's General Fund is used to provide fire, emergency
medical, and law enforcement services to the community; and
WHEREAS, revenues derived from the VLF and backfill are critically important in
sustaining 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.
Resolution No. 03-007
Page 2
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of
Poway, California, as follows:
If the state General Fund can no longer afford the expense of part or all of the
VLF "backfill," then 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
RESOLVED FURTHER, that the City of Poway hereby expresses its profound
appreciation to the legislators who support such VLF restoration legislation.
PASSED, ADOPTED, AND APPROVED by the City Council of the City of
Poway, California, at a regular meeting this 21st day of J~ uary 2003_.
Michael P. ~3"~fagr ~,~r
ATTEST:
L~ri ~nne Peoples, City Cl~rk
STATE OF CALIFORNIA )
)SS
COUNTY OF SAN DIEGO )
I, Lori Anne Peoples, City Clerk of the City of Poway, do hereby certify under
penalty of perjury that the foregoing Resolution No. 03- 007 was duly adopted by the
City Council at a meeting of said City Council held on this 21st day of January 2003,
and that it was so adopted by the following vote:
AYES: EMERY, GOLDBY, HIGGINSON, REXFORD, CAFAGNA
NOES: NONE
ABSTAIN: NONE
ABSENT: NONE
Lori Anne Pe(~ples, City Clerk "~
citYlof Poway