09-91 RESOLUTION 09-91
A RESOLUTION FINDING A SEVERE 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 incredible
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 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 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 the 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
Resolution 09-91
Severe Financial Hardship
WHEREAS, the combined effects of the seizure of the City's property taxes,
increasing unfunded state mandates, and the revenue losses due to the economic
downturn have placed the city's budget under serious fiscal pressure; and
WHEREAS, our city simply can not sustain the loss of any more property tax
funds or to be saddled with .any more state mandates as they will only deepen the
fiinancial challenge f-acing our city; and---
WHEREAS, a number of the City's financial commitments arise from contracts,
including 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 MENIFEE has determined that the City will experience a severe fiscal
hardship if the recommendation of the Department of Finance to "borrow" $2 billion of
local property taxes is supported by the Governor and 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.
RESOLVED FURTHER, that the City Clerk shall send copies of this resolution
to the Governor, our state senator(s), .our state assembly member(s) and the League of
California Cities.
ADOPTED this 2nd day of June, 2009.
PASSED, APPROVED AND ADOPTED, this 6th day of January, 2009 by the
following vote:
AYES:( ,1w� �. - t ' 1 l 7
/ 1
NOES: U —
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Resolution 09-91
Severe Financial Hardship
ABSENT:UAIO�
ABSTAIN:U'V f
Wallace W. Edgerton, Mayor
ATTEST:
Kathy 8enneft
City Clerk
Approved as to form:
Elizabeth Marlyn
City Attorney
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