CC Resolution 11047
RESOLUTION NO.
11047
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CAMPBELL FINDING A FISCAL
HARDSHIP WILL EXIST IF ADDITIONAL CITY PROPERTY TAX FUNDS ARE SEIZED AND
ADDITIONAL UNFUNDED MANDATES ARE ADOPTED BY THE STATE OF CALIFORNIA
WHEREAS, the current economic crisis has placed cities under severe financial pressure and
caused city officials to reopen already adopted budgets to make painful cuts, including layoffs
and furloughs of city workers, decreasing maintenance and operations of public facilities, and
reductions in direct services to keep spending in line with declining revenues; and
WHEREAS, since the early 1990s the state government of California has seized over $8.6
billion of city property tax revenues statewide (Campbell's cumulative loss is approximately
$15.8 million) to fund the state budget even after deducting public safety program payments to
cities by the state; and
WHEREAS, in FY 2007-08 alone the state seized $895 million in city property taxes statewide
to fund the state budget after deducting public safety program payments and an additional $350
million in local redevelopment funds were attempted to be seized in FY 2008-09; and
WHEREAS, the most significant impact of taking local property taxes has been to reduce the
quality of public safety services cities can provide since public safety comprises the largest part
of any city's general fund budget; and
WHEREAS, in 2004, California voters by an 84% vote margin adopted substantial constitutional
protections for local revenues, but the legislature can still "borrow" local property taxes to fund
the state budget; and
WHEREAS, on May 5 the Department of Finance announced it had proposed to the Governor
that the state "borrow" over $2 billion in local property taxes from cities, counties and special
districts to balance the state budget, causing deeper cuts in local public safety and other vital
services; and
WHEREAS, in the past the Governor has called such "borrowing" proposals fiscally
irresponsible because the state will find it virtually impossible to repay and it would only deepen
the state's structural deficit, preventing the state from balancing its budget; and
WHEREAS, the Legislature is currently considering hundreds of bills, many of which would
impose new costs on local governments that can neither be afforded nor sustained in this
economic climate; and
WHEREAS, state agencies are imposing, or considering, many regulations imposing unfunded
mandates on local governments without regard to how local agencies will be able comply with
these mandates while meeting their other responsibilities; and
WHEREAS, the combined effects of the seizure of the City's property taxes, increasing
unfunded state mandates and the significant revenue losses due to the economic downturn
have placed the City's budget under serious fiscal pressure; and
WHEREAS, the City simply cannot sustain the loss of any more property tax funds or to be
saddled with any more state mandates as they will only deepen the financial challenge facing
our city; and
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WHEREAS, a number of the City's financial commitments arise from contracts, including fire
services, long term capital leases and debt obligations which support securities in the public
capital markets, that the City must honor in full unless modified by mutual agreement of the
parties.
NOW, THEREFORE, BE IT RESOLVED THAT THE CITY COUNCIL OF THE CITY OF
CAMPBELL has determined that the City will experience a fiscal hardship if the
recommendation of the Department of Finance to "borrow" $2 billion of local property taxes is
approved by the Legislature; and
RESOLVED FURTHER, that the City Council strongly and unconditionally opposes the May 5
proposal of the Department of Finance and any other state government proposals to borrow or
seize any additional local funds, including the property tax, redevelopment tax increment, and
the City's share of the Prop. 42 transportation sales tax; and
RESOLVED FURTHER, that the City Council strongly urges the State legislature and Governor
to suspend the enactment of any new mandates on local governments until such time as the
economy has recovered and urges the state to provide complete funding for all existing and any
new mandates.
PASSED AND ADOPTED this
vote:
2nd day of
June ,2009 by the following roll call
AYES:
Councilmembers:
Kotowski, Furtado, Baker, Low, Kennedy
NOES:
Councilmembers:
None
ABSENT:
Council members:
None
APPROVED:
ATTEST:
tLbu-
Anne Bybee, City Clerk
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