Jun 26, 2009

California Tries to Grab Gas Tax Money

Like many states in the union, California has found this year to be a very difficult one from a budget standpoint. The state legislature tried to cover its profligate spending with a series of increased taxes and fees, but when those proposals were put before the California electorate in May, the voters gave it a rousing thumbs-down. So now the state legislature is trying to rebalance the long overdue 2009 budget by seizing almost $1 billion in city and county motor vehicle (gas) tax funds. Predictably, local California cities and towns, which would otherwise get the money, are against the idea. Plus, it is probably illegal.

The League of California Cities, which by the way is not a sports league, has released a legal opinion concluding that the proposed seizure of the motor vehicle tax funds to help close the state’s budget deficit is unconstitutional. Prepared by the law firm of Nielsen, Merksamer, Parrinello, Mueller & Naylor, LLP, the opinion points out that in both 1974 and 1998, voters imposed restrictions on the state’s ability to use gas taxes for debt service on bonds and to divert local gas taxes for the state general fund, and that is precisely what has been proposed by state leaders.

First proposed by Governor Arnold Schwarzenegger in May, the “raid” on the gas tax money was approved by the California Joint Budget Conference Committee on a party-line vote (Democrats for; Republicans against). The league says not only is the proposed action unconstitutional, but “it will put at risk the safety of all Californians who use the local streets and roads that make up the more than 80 percent of the state’s road system.” Loss of the gas tax funds will seriously compromise cities’ ability to perform critical safety-related street maintenance, such as drastically curtailing street patching and resurfacing, street sweeping, street light and traffic signal maintenance, bridge maintenance and repair, snow removal, and sidewalk and curb ramp maintenance and repair.

Without these funds some cities will have no choice but to eliminate part or all of their street maintenance operations. Other cities will cut back in such areas as police and fire services to pay for basic street repair and maintenance. Poorly maintained streets will mean delays in emergency response and more vehicle repair costs. As street conditions consequently worsen, injuries and traffic accidents will rise. At some point, dust from potholes might obscure the sun. Beyond the immediate public safety concerns that would result from loss of street maintenance funds are the environmental impacts of this proposal. Reductions in street sweeping and worsening road conditions will mean increased water pollution runoff to nearby streams and the ocean, longer car idling times, more pollution and more respiratory problems for vulnerable populations. In other words, this kinda sucks.