HomeMy WebLinkAbout27-Council Office CITY OF SAN BERNARDINO - REQUEST FOR COUNCIL ACTION
From: Councilwoman Wendy J. McCammack Subject: Report to the Mayor and
Common Council on Councilwoman
McCammack's attendance at the
League of California Cities Housing,
Community and Economic
Development Policy Committee as well
as the Revenue and Taxation Policy
Committee Meetings in Sacramento.
Dept.: Council Office
Date: February 4, 2008
Synopsis of Previous Council Action: N/A
Recommended Motion: To receive and file.
Signature
Contact Person: Councilwoman McCammack Phone: 5068
Supporting Data Attached: N/A Ward:
FUNDING REQUIREMENTS: Amount: N/A
Source: (Acct. No.)
(Acct. Description)
Finance:
Council Notes:
Agenda Item No. _
REVENUE AND TAXATION POLICY COMMITTEE
Thursday,January 17,2008
10:00 a.m.–3:00 p.m.
Sacramento Convention Center
Revised "'' Intn Record at-
AGENDA vf)evcros Mtg: __-
1. Welcome and Introductions
,ev�.c,.,C,, rr�.e�vwl�-�/4. � Cu,�cvrc�•c,�'
11. Public Comment
�Ja Item 11r-27
III. Overview of Parliamentary Procedure and Roberts Rules(Hand t)
IV. Committee Orientation �Z�. .
City CIerkICDC Secy
V. League Strategic Goals Ottuchment.4) city of San Bernardino
V1. Review of Summary of Existing Policy & Guiding Principles (Attachment B)
V11. Legislative Update (State and Federal)
x(11. (10:30 a.m.) Special Guest: Betty Yee,Chair,California State Board of Equalization: A
discussion with city officials about emerging issues related to sales and use taxes, and other issues.
(.4 ttachment C–Electronic copy not available)
ix. (11:00 a.m.) Review of Local Revenue Protections: Proposition I and Redevelopment
Betsy Strauss, Special Counsel, League of California Cities
Brent Hawkins, Special Counsel, California Redevelopment Association
John Shirey, Executive Director, California Redevelopment Association (Attachment D– E/«u nnic•
cop,•not uvadable)
X. Assembly Member Roger Niello(R)-- Sacramento, Vice-Chair, Assembly Budget Committee.
Republican reaction to Governor's Budget. 1.41tachmew E- 1:12tro;li NvuK
X1. (1 1:40 a.m.) Fred Klass, Chief Operating Officer,State Department of Finance, Presentation on
Governor's Budget
X11. Lunch--Noon
X111. (12:30 p.m.) Existing VLF revenue"bump" for Annexations and Incorporations: Should the
League Support the Extension of provisions of AB 1602(Laird)?
-Michael Coleman, Fiscal Policy Advisor, league of California Cities
-Tamra Middlecamp, Senior Management Analyst, City of Temecula
- Bill Chiat, Executive Director, California Association of Local Formation Commissions
(CalLAFCO) (,=1 ttachment F)
(1:00 p.m.) Assembly Member Anna Caballero,(D)—Salinas,Chair, Assembly Local
Government Committee. Perspective on the State Budget, and discussion with Committee Members
on potential impacts on local government. (Attachment G-Electronic copy rot available)
XIV. (1:30 p.m.) Update on Streamlined Saes Tax Project: Adoption of New Sourcing Amendment.
-Fran Mancia, Director of Government Relations, MuniServices
-Fran Delach,City Manager, City of Azuza
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r� XV. (2:00 p.m.)Committee Work Program
i • 2007 Work Program Status (Attachment H)
• 2008 Work Program (Attachment/)
XV11. Next Meeting: WEDNESDAY, April 2, 2008–Ontario Convention Center
-Over-
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RESrENM AND TAXATION POLICY COMNIITTEE
WGIEUG18,T8
January 17,2008
Sacramento Convention Center
A TTENDANCE
Members: Jay Goldstone(Chair), San Diego; Terry Henderson(4"ice Chair), La Quinta; Karen Avilla,
Carson;Robert Biery, Westlake Village; Jean Blois,(3oleta;Mary Bradley, Sunnyvale;Holly Brock-
Cohn,Hayward;Ken Campo, Vacaville; John Chlebnik,Calimesa; Stanley Cohen, Sonoma; Cheryl Cox,
Chula Vista; Amy Cunningham, Dublin;Dick Daniels,Escondido; Fran David,Hayward; C:aro'xe Dillon-
Knutson,Novato; Richard Dixon,Lake Forest; Michael Edmiston, California City; Iya Falcone, Santa
Barbara;Shari Freidenrich,Huntington Beach; Kathleen Griffith, Lompoc; Helen Hall,Fullerton;
Matthew Ha.wkesworth,Rosemead; Jim Janney, Imperial Beach; Susan Loftus,San Mateo; Ludmyrna
Lopez,Richmond; 'Wendy McCammack, San Bernardino;Paul Navazio,Davis; Alford Nero,,Brea;
Michael Noll, Signal Filly Laura.Parisi, Laguna Beach; Martin Pastucha,Pasadena; Candy Pierce, Chico;
Sepi Richardson,Brisbane; Doug Robertson, Victorville; David Sander,Rancho Cordova; Sonya Silva,
Newman; Arne Simonsen,Antioch;Karen Stepper,Danville; Fred Strong,Paso Robles; Cody Tubbs, Elk
Grove; Charles View,Brea,;Joe Vinatie. , Whittier; Roy Wasden,Modesto; Robert Woolley, Clovis
Staff: Dan Caarigg
League Partrier: Denise C)vrorn, Associate, HdL Companies
Guests: Fran Mancia, Director, Governmental Affairs,MuniSeMces.
A substitute attended for Pam Eastc.r, Assistant City Manager,Rancho Cucamonga
I. Welcome and Introductions
Chair Jay Goldstone welcomed everyone to the first meeting of the year for the Revenue&
Taxation Policy Committee. Self introductions followed.
m[. Public Comment-
None received.
;H1. Overview of Parliamentary Procedure and Roberts Ruffles
Chair Goldstone referenced the handouts and asked committee members to follow Roberts
Rules when conducting policy committee business.
IV. Committee Orientation
Chair Jay Goldstone referenced the Summary of Existing Policy&Guiding;Principles for the
Revenue&Taxation Policy Cornnitittee. This document provide=s guidelines on what
positions the League adopts on measures with fiscal implications. Mr.Goldstone also went
over the informal rules of the corrirnittee and how the meetings will be run.
V. Review of Summary of Existing Policy &Guiding.Principles
League Legislative Director,Dan Carrigg,explained the one propt:used addition to the
Principles to be included in the 2008 update, to reflect the Committee's past support for state
disaster recovery legislation- The committee adopted the following additional language to the
League's Revenue and Tmtion Principles:
'When disasters occur in various areas of the sxate, the stage government has traditionally
.stepped in to assist with recovery efforts through various mceans, including the passage of
legislation to provide income and property tray relLIfto affec�ted individuals and
businesses, and reimbursing local governmena far their losses. The League supports
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disaster recovery legislation that includes mitigation for losses exprtrtenced by local
governments."
VL League Strategic Goads
Chair Goldstone reviewed the 2008 League Goals, developed under the theme "Building
Sustainable Communities:"
• Protect funding for vital cominuruty services
Support green and sustainable cities
a Expand infrastructure investment
Enact honest and reasonable eminent domain reform
VU. Legislative Update
Dan Carrigg gave a brief update on the status of the budget. He noted that while the proposed
10%across the beard out also did affect COPS and booking fee programs, that neither local
property taxes nor sales tax on gas revennues were proposed to be borrowed as part of the
Governor's budget.
Lean also updated the commideee on the recent passage of the new federal Energy Effi6ency
and Conservation Block Grant program, and reminded then that the existing federal
moratorium on taxation of Internet access had been extended by federal legislation for an
additional seven years:
Chair Goldstone suggested that m anticipation of the need to respond quickly to
developments on the budget,the committee should form a temporary subcommittee to be
available to react to various proposals. The committee agreed,and a sign-up sheet was
circulated.
Special Gust: Betty Yee,Chair, California State Board of Equalizations:
State Board of Equalization Chairwoman Betty Yee attended the League's Revenue and
Taxation Committee meeting to deliver a synopsis of signnifcant issues for cities,including
California's budget crisis. As part of her introductory cottunents she mentioned her many
years of work on local government issues both as a consultant:in the State Capitol and with
the Department of Fizzance.
Chairwoman Yee spent a significant amount of time covering;fees and taxes administered by
the Board. An issue of particular interest for Ms, Yee is the continued effort to collect use
taxes and to support efforts,staffing levels and Iegislation that would result in the collection
of additional use talc revenues owed to the State.
She spoke about some of the other issues she has focused on at the BOE,including working
on petrol refinery issues with counties; leveling the playing field so that registered domestic
partners were handled in same manner as married individuals; continuing;to work on"digital
infrastructure"issues such as music downloads; and the legal complexity of medical
mari.i usina dispensaries.
bAs. Yee also highlighted several proposals m the Governor's Budget to help close the budget
gap,including collecting an additional 5129 million in sales and use tae by increasing
enforcement.
In response to a question on the Streamlined Sales Taut project, she responded that the SCE's
focus on the Streamline Sales Tax project was dropped because of the uniform sourcing rule,
California's complicated sales tax system,and the politiral reality that it was mlikely that the
state would agree to erode current legislative power and align its laws to join the project_ She
said she welcomed input from the comsanittc a can this topic.
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Vffi. Review of Local Revenue Protectioas: Proposition IA and Redevelopment
Betsy Strauss,Special Counsel, League of California Cities;Brent Hawkins,Special Counsel,
California Redevelopment Association; and John Shirey,Executive Director, California
Redevelopment Association,provided a joint panel and PowerPoint presentation on the
contents of Proposition 1A of 2004,and its protections for local property=es. The
discussion of redevelopment centered on the many negative potential consequences on
redevelopment authority,rent control ordinances,water supply projects, nclusionary zoning
and general local land use authority froze the proposed initiative sponsored for the rune 2008
h-lint hir the Wmifnrd Tnmin Tnumninu e A■■r■lane (Muir i mir + nn)
LX. Assembly Member Roger Niello (R)--Sacramento,Vlce-Chair,Assembly Budget
Committee. Republican reaction to Governor's Budget.
Assembly,Member Roger Niello outlined sortie of the highlights of the Governor's Budget
which was just beginning tea be reviewed by the Legislature. He voiced concern for tt'rr.
prison release proposal, and said that the state was facing severe challenges and it would be a
long year.
X. Lunch--Noon
,a. Discussion of SB 301 (Romero)and the proposed extension of provisions of previously
League-sponsored AB 1602 (Laird).
Michael Coleman,Fiscal Policy Advisor, League of California Cities;Tamra Middlecaanp,
Senior Management Analyst, City of Temecula; and Bill ChiaE,Executive Director,
California Association of Local Formation Commissions(CalLAFCO); and Terry Schanz,
Consultant,Office of Senator Gloria Romero, formed a panel to discuss 0301 omerol
SB 301 alters the sunset date included in prior League-sponsored AE 1602 (Laird)of 2006,
which provided an increased allocation of city Vehicle License Fee revenges for new
incorporations and annexations by cities of inhabited areas. In brief';the legislation
permanently removes the sunset date of July 1,2009,for feature annexations by cities of
inhabited territory, and extends to July 1,2014, the sunset date as it applies to new
incorporations.
The law put in place by AB 1602 was adopted in reaction to the nu inbeT of pending
annexations aW incorporations that were "caught in the middle"when the VLF-property tax
swap occurred in 2004. The details of the proposal were developed by a subcomnuttec of the
League's Committee on Revenue and Taxation. The reason for the sunset was to allow
enough time for pending proposals to continue to move forward. Cities and incorporation
groups now view this law as vital to future inhabited annexation and incorporation proposals.
According to an analysis of city VLF revenues prepared by League'Fiscal Consultant
Michael Coleman, while these revenues can be very helpful to affected annexations and
incorporations, the long-term impact on all city VLF fords,plus the property tax cities
received in lieu of VLF clue to the swap,amounts to less than 2%of total. Prior to the%`Ll
proper by tax swap,cities received approximately$60 per capita in VLF revenue,but after the
:5wap, they received approximately$S per capita. In the swap, existing cities received
property taxes in exchange for their VLF on a dollar-for-dollar basis,and those amounts now
grow as property taxes. So far this exchange has proven to be positive for cities,as property
tax has grown much faster than VLF. The reduction of per-capita VLF amounts,however.,
drastically altered the financial analysis of pending annexations of inhabited areas and
incorporations that were contingent on receiving per-capita VLF.
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After, several motions,the committee voted to support Sly 301.as described abcive. The
committee also stated its support for the future remval of the sunset that applies to new
mcorporatioii3.
Assembly Member Anna Caballero,(D) Salinas,Chair,Assembly Local
Government Committee. As part of her introductory eonuncrits,Assembly Member
Caballero mentioned her years at ft local,government level as Mayor of Salinas and bee
understanding of the perspective of local government toward the state. She spoke of her
frustration with the challenges posed by the state budget and was critical of the across tle
board approach taken by the Governor.
-XM Update on Streamlined Sales Tax Project: Adoption of New Sourcing Amendment
Fran Mancia, Director of Government Relations,MuniServices; and Fran Delacb, City
Manager.City of Ate., updated the committee on the status of the Streamlired Sales Tax
Project.
Tl3.e Streamlined Sales Tax.Praje.cL(SSTP)was initiated.in Much of 2000 as a result of the
Congressional action on the bternet Taut Freedom Act. The ptarpose of the SSTP was to
analyze how rate and local governments were impacted by interstate conuneree and the lost
Internet sales tax. The unstated goal of the project is to convince Congress,as a trade off for
-ales tax simplifieatiorb, to modify existing law so t+bat states can collect sales tax m ra- ote
sales(Internet purchase`s,mail orders,etc.)from retailers who have no physical presence or
"nexus"inside the state.
While many states have joined: die problem with the grow`,h of the SST?has generally been
focused on an issue called"Sourcirg",the deteamination of where sales tax should l`e
allocated.. Many states clwSc ant:collect sales tax on non-general merchandise materials;
(appliances,automobiles,equipment,large sup
ply orders),on a"destination"based system,
or point of use system. Many of the larger,more metropolitan states,however,hav a sales
tax system primarly based on an"origin"based system„or"point of sale." An origin base
or"point of sale"system is used in California,Texas,New York, Illinois, and Virginia to
name a few.
Mr.Maneia and Mr. Delach informed the committee about a recent proposed amendment by
the States of Ohio and Olelahotm that would aid the SSTP Regulations to allow"origin
based" sourcing within a state, This factor would allow states like California and Texas te.
join the SSTP without significantly damaging the economic tax structure for local
government. The next Governing Board Meeting will be held in Reston Virginia,on April
and a primary topic of discussion will be language related"to sourcing of services."
After responding to several questions,the committee approved a motion for the League to
se;ad,a.letter to Betty Yee encouraging the BUE to re-eu age in the Project The Committee
-.i!so expressed interest in forming a subcommittee to review the details of the recent sourcing
proposals.
klYt. Committee Work Program
League Legislative Director,Deus Carrigg,opened the discussion regarding the proposed 2008
Work Program for the Revenue&Taxation Policy Committee. The draft work program
incorporated the League's 2008 priorities,as well as some issues remaining from the 2007
year, After some discussiom,the proposed 2008 Work Program was approved. It will br
submitted to the League Board in February.
)IV. Nest Meeting: WEDNESDAY,Agrid 2,2008—Ontario Convention Center
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HOUSING,COMMUNITY& ECONOMIC DEVELOPMENT POLICY COMMITTEE
Friday,January 18, 2008
10:00 a.m. —3:00 p.m. o _�
Sacramento Convention Center co
F C--
� .,cza
AGENDA
cn `c
I. Welcome and Introductions
IL Public Comment N
III. Overview of Parliamentary Procedure and Roberts Rules (Handout) cn
co
IV. Committee Orientation
V. League Strategic Goals (Attachment A)
VI. Review of Summary of Existing Policy& Guiding Principles (Attachment B)
VII. Committee Work Program
• 2007 Work Program Status (Attachment C)
• 2008 Work Program (Attachment D)
VIII. State Budget Update
IX. Legislative Update(Handout)
X. Guest Speaker: Lynn Jacobs, Director,California Department of Housing and
Community Development
XI. Update on SB 375
XII. Climate Change Principles(Attachment E)
XIII. Subprime Mortgage Crisis Update(Attachment P-)
XIV. Guest Speaker: Lori Saldana,Assembly Member,76`h District,and Chair,Assembly
Committee on Housing and Community Development
XV. HCED Subcommittee Status Update
XVI. Next Meeting: THURSDAY, April 3,2008—Ontario Convention Center
Brown Act Reminder, The League of California Cities'Board of Directors has a policy of complying with the spirit of open meeting laws. Generally,off-agenda items
may he taken up only if.
1) Two-thirds of the policy committee members find a need for immediate action exists and the need to take action came to the attention of the policy
committee after the agenda was prepared(Nose: lffewer than two-!hinds ofpo/icy committee members are present,taking up an off-agenda item
requires a unanimous vote):or
1) A majority of the policy committee finds an emergency(for example:work stoppage or disaster)exists.
A majority of a city council may not,consistent with the Brown Act,discuss specific substantive issues among themselves at League meetings. Any such discussion is
subject to the Brown Act and must occur in a meeting that complies with its requirements.
NOTE:Policy committee members should be aware that lunch is usually served at these meetings.The.state's Fair Political Practices Commission takes the
position that the value of the lunch.should be reported on city officials'.statement of economic interests form. Because of the service you provide at these
meetings,the League takes the position that the value of the lunch should be reported as income(in retum for your service to the committee)as opposed to
a gift(note that this is not income for state or federal income tax purposes just Political Reform Act reporting purposes). The League has been persistent,
but unsuccessful,in attempting to change the FPPC'.s mind about this interpretation. As such,we feel we need to let you know about the issue so you can
determine your course of action.
lfyou would prefer not to have to report the value of the lunches as income,we will let you know the amount so you can reimburse the League. The lunches
tend to inn in the S25 to SS35 range. To review a copy of the FPPC's most recent letter on this issue,please go to www carutes org ITN'letter on the
League's website.
't;�?`�'Ot7�1 id; 1: FAX 9G0 13 31C►5 SB CITY-COUNCIL OFFICE Mr-CAM?iACK-work `i 003
relating to the state mandating specific ways or methods of accomplisF ing state goals(for
example, funding natural gas but not bio fuel,even though both may achieve the same or
similar re_,wuit).
• Requiring LAFCO's to Consider Blueprints in Changes to Organization.
(This item was placed on the agenda for general discussion only, no action). The League
has long articulated the, cities are subject to two different and unrelated processes when it
comes to p1mining for growth. First,there is the county specific LAFCO process that
governs annexations and the extension of municipal services and special district
boundaries(among other things). Increasingly,however, there is an evolving se�.ond
mechanism, coined"regional blueprints,"that are often multi-county and do not
necessarily take LAFCO plans into account. but nevertheless often serve as the basis for
housing allocations (Regional Housing Deeds Assessment)and transportation funding
under the Regional Transportation Plans.
There is nothing that requites LAF COs to consider regional planning. One bill that is
likely this year is to add the consideration of regional blueprint goals and strategies;to the
list of 16 other factors that a LAFCO must consider when making a decision on an
application for change of organization(which includes annexations and incorporations).
The committee discussed this idea,and there were a variety of opinions. Some
committee members expressed support for blueprints in general, and other members t�tt
that ibis change would make blueprints themselves become less voluntary. One idea that
was not objected to would be to have LAFCOs consider the Regional Transportation
Plan;, which is often influenced by Blueprints but controls real investment in
infrastructure, instead of Blueprints.
h
X. truest Speaker: Lynn Jacobs,Director,California Department of Housing and
Community Development
Lynn Jacobs, Director of,the California Department of Housing and Community
Development(HCD), addressed the committee about a number of items including the search
for a permanent source for affordable housing, Proposition I money,the subprime mortgage
crisis, and HR 2764,
14CD wall be holding a number of regional meetings to talk with local governments,
businesses and educational communities about finding a permanent source for affordable
housing. Meeting=s will be held in Orange County, Sacramento, Riverside, Fresno, Sin Diego
aizd the BaL, area—more information about dates and times for meetings can be found e't
wtiv'W.i'1C(�.Ca.�ESY.
Xi. Update on Ski 375
Bili Higgins provided an overview of where the League is on SB 375; including a rzcap of
the legislative histon;of the bill and the meetings that the League board has had with both the
sponsor and the author(Senator Steinberg) in 2007. League staff has been working;hard to
suggest language that would make the bill"work." Specifically,staff divides the bi",1 into
three issues:
• Using regional transportation planning as a tool to develop a strategy(called a
"sustainable communities strategy)to reduce the GHGs that come from car..; and light
trucks(which account for more than Mo of total GHGs).
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• Streamlining CEQA review for projects that are consistent with the sustainable
communities strategy.
• `'ghat is missing from the bill: reconciling G1gG strategies with the RHNA process and
identifying tools for local agencies to build the :infrastructure necessary to serve new
growth in infill areas.
League staff us working with the author and the sponsor to address issues of local concern in
ail of these areas. A recent development is that all the local government representatives,�,
including C 0s, Counties, LAFCOs,Cities, and some transportation agencies have been',.
working very closely together to coordinate responses and help assure that the bill addresses
emissions goals in an effective manner.
?i;l. Climate Change Principles
Kyra Ross, Lague lobbyist on environmental issues, led the discussion about the proposed
Climate Change Principles.
The League's Climate Change Working Group was approved by the League's Board of
Directors in February to"...develop recommendations for League Climate Change Guiding
Principles that the League can use in evaluating legislation to determine a League position...."
The Working Group, consisted of representatives from three League policy committees(EQ,
ICED and TCPW),and met at the League offices on March 1,2007 and subsequently by
telephone conference call. Their recommendations were provided to policy committee
members in March 2007 and subsequently considered by the League Board in May 2007.
Because of the large discrepancy between the policy committee changes, the League Board
chose to send the proposed climate change policies back to the Working Group for further
refinement. The Working Group met again in October 2007 and subsequently by phone in
November 2007.
The focus of the Working Group and policy committees was to consider and recommend
positions or policy principles that would guide League staff when they review legislation
related to cities and climate change.
The committee had several questions about the proposed principles, but ultimately decided to
€uppurt the changes that were adopted by the Environmental Quality Policy Committee.
League staff will merge the three versions of the principles(EQ,HCED, and TCPW), which
will then be sent to the League Board for discussion and approval at the February Board
meeting.
XHI. Subprime Mortgage Crisis Update
Chair Ken Cooley briefed the group about the subprime mortgage crisis, including the
documents he put together regarding the many resources that are available to homeowners.
Ken also referred committee members to the League website,which has a new page devoted
entirely to this issue: www.cacities.orgisubprime.
XIV. Guest Speaker: Lori Saldana,Assembly Member,76*District,and Chair,Assembly
Committee on Housing and Community Development
Assembly Member Lori Saldana was elected in 2004 and is currently on her second term.
She is the Chair of the Assembly Committee on Housing and Community Development.
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