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Item 15 - Status Report on Pending Legislation AGENDA O: Honorable Mayor and Members of the City Council FROM: James L. Bowersox, City Mana~ INITIATED BY: John D. Fitch, Assistant City Manager~7~)_~.~ _ Penny Riley, Senior Management Analys~ DATE: April 4, 1995 SUBJEC'q~: Status Report on Pending Legislation ABSTRACT The League of California Cities has informed the City of the following measures which are pending in the State Legislature: SB 150 (Johannessen) Vehicle License Fees and Gas Tax Revenue Allocations; AB 208 (Cannella) Agricultural Equipment Sales Tax Exemption; SB 1266 (Dills) Redevelopment Prohibition on Eminent Domain for Commercial Properties; SB 850 (Hayden) Public Agency Immunity; SB 602 (Wright) Use Tax on Leased Vehicles; AB 307 (Thompson) Unfunded Mandates; ACA 7 (Pringle) Unfunded State Mandates; ACA 8 (Goldsmith) Unfunded Mandates; and SB 805 (Monteith) Unfunded Mandates. Additionally, the League of California Cities has informed us of Administrative Activities by the California Public Utilities Commission (CPUC) related to GO 159 Cellular Tower Zoning Preemption. ENVIRONMENTAL REVIEW Environmental review is not required for this item under California Environmental Quality Act guidelines. FISCAL IMPACT There is no fiscal impact associated with this informational report. ADDITIONAL PUBLIC NOTIFICATION AND CORRESPONDENCE Assemblyman Jan Goldsmith; Senator David Kelley; Bob Wilson, the City's Lobbyist; and the League of California Cities were notified of this agenda item. RECOMMENDATION It is recommended that the City Council oppose SB 150~ oppose AB 208; oppose SB 1266; oppose SB 850; support SB 602; support AB 307; support ACA 7; support ACA 8; and support SB 805. Additionally, staff will provide input to the California Public Utilities Commission on GO 159. ACTION 1 of 6 APR 4 1995 ITEM 15 CITY OF POWAY AGENDA REPORT TO: Honorable Mayor and Members of the City Council FROM: James L. Bowerso×, City Mana~ ~ DATE: April 4, 1995 SUBJECT: Status Report on Pending Legislation BACKGROUND The League of California Cities has informed the City of the following measures which are pending in the State Legislature: SB 150 (Johannessen) Vehicle License Fees and Gas Tax Revenue Allocations; AB 208 {Cannella} Agricultural Equipment Sales Tax Exemption; SB 1266 {Dills) Redevelopment Prohibition on Eminent Domain for Commercial Properties; SB 850 (Hayden) Public Agency Immunity; SB 602 {Wright) Use Tax on Leased Vehicles; AB 307 (Thompson) Unfunded Mandates; ACA 7 (Pringle) Unfunded State Mandates; ACA 8 (Goldsmith) Unfunded Mandates; and SB 805 (Monteith} Unfunded Mandates. Additionally, the League of California Cities has informed us of Administrative Activities by the California Public Utilities Commission {CPUC) related to GO 159 Cellular Tower Zoning Preemption. FINDINGS SB 150 {Johannessen) Vehicle License Fees Senator Johannessen introduced SB 150 on January 25, 1995, which provides, for purposes of allocating revenues derived from taxes imposed under the Vehicle License Fee Law and Motor Vehicle Fuel Tax Law, that a "city and county" shall include a county that does not contain any incorporated city. VLF and Gas Tax revenues are distributed in two separate allocations, one to all cities and one to all counties. Cities receive VLF primarily on a per capita basis and gasoline tax subventions under several different formulas. By including each of these three counties, Alpine, Mariposa and Trinity, as a "city and county" {currently only San Francisco is a "city and county"), they would share in both the county and city distributions of VLF and Gas Tax revenues. The total amount of these revenues available to all cities would therefore be reduced by about $1.7 million in order to allow these counties to "double dip" from the city allocation. 2 of 6 APR J- 1995 ITEM 15 Agenda Report - Pending Legislation April 4, 1995 -- Page 2 On March 13, 1995, Art Madrid, Mayor of La Mesa, sent a letter to the Council requesting that Poway oppose SB 150. It is recommended that the City Council oppose SB 150 and direct staff to notify the Senate Committee on Local Government of the City's opposition to the measure. AB 208 {Cannella) - Aqricultural Equipment Sales Tax Exemption Assemblymember Cannella introduced AB 208 on January 30, 1995, which would exempt certain agricultural personal property used by a new trade or business from both the state and local sales tax. The personal property would have to be used in the production of food, fiber, and other agricultural commodities; or in research and development; or in any stage of the processing or recycling of property; or by a contractor purchasing that property as an agent of a qualified person. The purchase must be by a qualified person, which is defined as a new trade or business which has been in existence less than three years. Staff is currently working with representatives of an agricultural equipment retailer which may locate in the South Poway Business Park. It is recommended that the City Council oppose AB 208, as this legislation would reduce the anticipated sales tax revenue to the City associated with the retailer. SB 1266 {Dills) - Redevelopment: Eminent Domain Prohibition Senator Dills introduced SB 1266 on February 24, 1995, which prohibits a redevelopment agency from acquiring any real property by eminent domain for a redevelopment project if the project involves the acquisition of a privately owned business for the eventual use by another privately owned business. This legislation would eliminate the ability of agencies to use eminent domain powers to assemble and improve parcels for resale to a private developer. The League of California Cities is recommending that cities vigorously oppose SB 1266. SB 850 {Hayden) - Public Aqency Immunity Senator Hayden introduced SB 850 on February 23, 1995, which would enact a significant change to the Tort Claims Act, which currently gives local governments immunity for a variety of actions. SB 850 would provide that a city or county that knowingly issues a development permit within a hazardous area is liable for hazard-related injuries occurring in an adjacent city, or a death demonstrated to be proximately caused by the issuance of the permit. The hazardous areas specified in the measure include special flood hazard areas, areas subject to potential flooding, very high fire hazard zones, and earthquake fault or seismic hazard zones. The League opposes SB 850 because it would make cities liable for damages caused by floods, earthquakes or fires simply because they issued a building permit. While the League recognizes that local, state, and federal governments, along -- with the insurance industry and private citizens, have been faced with high costs 3 of 6 APR J- 1995 II'Ei~ 15 Agenda Report - Pending Legislation April 4, 1995 Page 3 due to the multitude of flood, fire, and earthquake disasters in California, the League does not agree that the solution is to hold local government liable. It is recommended that the City Council oppose SB 850, as it would increase the City's'exposure to liability claims. SB 602 (Wriqht}- Use Tax on Leased Vehicles Senator Wright introduced SB 602 on February 22, 1995, which would provide that the use tax on leased vehicles would be allocated to the location where the lease was negotiated. This would not apply to lease transactions between an out-of- state lessor and a lessee who is a California resident. This bill would not generate any additional sales and use tax, but would instead change the allocation between taxing jurisdictions. Current law provides that when a vehicle is sold to an individual, the sales tax is based on the full purchase price of the vehicle and the local sales tax is allocated to the taxing jurisdiction where the automobile dealer is located. When a vehicleis leased, use tax is imposed on the monthly lease payments. The local use tax is allocated to the countywide pool in the lessee's county of residence. That countywide pool is allocated to all taxing jurisdictions within the county based on their proportionate share of total local sales tax receipts in the prior fiscal year. About forty percent of total transactions relating to new vehicles are through leases. Given the large percentage of sales tax base attributable to auto sales in Poway and the increasing popularity of automobile lease options, SB 602 may proyide a mechanism for increased sales tax revenues for the City of Poway. It is recommended that the City Council support SB 602. Unfunded Mandates The League of California Cities identified mandate relief as an issue on the agenda for both the state and federal legislatures during the current sessions. There are four new mandate relief measures in the California Legislature that the League of California Cities is supporting. The legislation is summarized below: AB 307 {Thompson} - requires that any bill containing a state-mandated local program without an appropriation or disclaimer of reimbursement be referred to the committee on rules in the house of origination. The committee will (1) hold the bill until the mandate is funded, or (2) a statement will be printed on the bill which indicates that the bill is an "unfunded mandate." ACA 7 (Prinqle) - requires the state to pay local governments for the cost of any new program, higher level of service, or increased cost mandated by the state (excluding mandates requested by a local agency or new crimes}. 4 of 6 APR '~ 1995 ITEM 15 Agenda Report - Pending Legislation April 4, 1995 Page 4 ACA 8 {Goldsmith) - provides that a local agency, other than a school district, may decline to implement a program of higher level or service mandated by the state until the state provides a subvention of full funding to reimburse the local agency. Also authorizes a local agency to discontinue a mandate when all of the funds provided have been expended. (Excludes mandates requested by a local agency, defining a new crime, imposed by the federal government, implementing a court decision holding that the mandate is declaratory of existing law, implementing a ballot measure approved by the voters, or with offsetting savings.) SB 805 {Monteith) - provides that any state program, rule, regulation or administrative policy that is not fully funded by the state shall be inapplicable to any local agency unless expressly approved by a majority of the legislative body of that local agency. Cellular Tower Zoninq Preemption {GO 159) The California Public Utilities Commission (CPUC) is seeking city input to a proceeding initiated by the cellular telephone industry to preempt local zoning over the placement and siting of cellular towers. A group of California cellular industry representatives have proposed to the Federal Communications Commission (FCC) that cities and counties have been an impediment to the siting of cellular facilities. The CPUC is in the process of considering whether to clarify local control of cellular tower siting rests with cities and counties. The issue of locating cellular antenna is of paramount importance to planning considerations and it is vital that local agencies maintain land use control. Some cellular antenna may range in height from 30 to 50 feet and could potentially have adverse visual and/or aesthetic impacts. Historically, the Poway City Council denied a conditional use permit application for a cellular tower because it was deemed incompatible with the surrounding land uses. The antenna proposed by U.S. West Cellular would have produced only marginal improvement in cellular service and the proposed location placed the equipment on a prominent ridgeline, which would have had significant adverse visual impacts on the community. Staff is recommending that the City Council oppose any regulatory action which will infringe on the sovereignty of local agencies to regulate the aesthetic impact of cellular antennas. ENVIRONMENTAL REVIEW Environmental review is not required for this item under California Environmental Quality Act guidelines. FISCAL IMPACT There is no fiscal impact associated with this informational report. 5 of 6 APR A 1995 ITEM 15 Agenda Report - Pending Legislation April 4, 1995 Page 5 ADDITIONAL PUBLIC NOTIFICATION AND CORRESPONDENCF Assemblyman Jan Goldsmith; Senator David Kelley; Bob Wilson, the City's Lobbyist; and the League of California Cities were notified of this agenda item. RECOMMENDATION It is recommended that the City Council take the following actions: 1. Oppose SB 150 and direct staff to notify the Senate Committee on Local Government of the City's opposition to the measure. 2. Oppose AB 208 and direct staff to notify the Assembly Committee on Revenue and Taxation of the City's opposition to the measure. 3. Oppose SB 1266 and direct staff to notify the Senate Judiciary Committee of the City's opposition to the measure. 4. Oppose SB 850 and direct staff to notify the Senate Judiciary Committee of the City's opposition to the measure. 5. Support SB 602 and direct staff to notify the Senate Revenue and Taxation Committee of the City's support of the measure. 6. Support AB 307 and direct staff to notify the Assembly Committee on Local Government of the City's support of the measure. 7. Support ACA 7 and direct staff to notify the Assembly Committee on Local Government of the City's support of the measure. 8. Support ACA 8 and direct staff to notify the Assembly Committee on Local Government of the City's support of the measure. 9. Support SB 805 and direct staff to notify the Senate Judiciary Committee of the City's support of the measure. 10. The City will provide input to the California Public Utilities Commission (CPUC) on the cellular antenna issue. eb: \rpts\pn leg.404 6 of 6 APR J, 1995 ITEM 15 .,