california local government finance almanac

Major State Laws Concerning California Municipal Finance


Taxation: Authority, Procedures and Limits
Municipal Affairs Doctrine: Matters relating to municipal finance are "municipal affairs" subject to charter city enactments.
Power to Tax: all cities have the power to tax.
Local Taxation Authority: The Legislature "may not impose taxes for local purposes but may authorize local governments to impose them."
Police Power: includes the authority to impose regulatory fees.
Public Works Power: includes the authority to impose rates and charges to finance light, water, power, heat, transportation, and means of communication.
Proposition 13 (1978) Tax Limitation
Proposition 62 (1986) Votes on Taxes
Proposition 218 (1996) Votes on Taxes, Assessment and Property Related Fees
Special Taxes (2/3 vote) versus General Taxes (majority vote). A special tax is a tax that is "collected and earmarked for a special purpose, rather than being deposited in a general fund."
General Tax measure must be "consolidated with a regularly scheduled general election for members of the governing body of the local government, except in cases of emergency declared by a unanimous vote of the governing body."
Advisory Election Measures
Mailed Ballot Elections
Debt Financing
General Obligation Bonds:
Municipal Improvement Bond Act of 1901  Government Code 43600
Two-thirds supermajority  voter approval required and may only be used for acquisition or improvement of real property California Constitution Article XIIIA 1(b)
California Constitution Article XVI, 18
Government Code 43614
Proposition 39 (2000) 55% Vote for School Bonds
Local Revenue Bond Law (1941) Majority Voter Approval
         (General Law Cities)
Community Facilities Districts - Mello-Roos Act of 1982
Short-Term Borrowing
Marks-Roos Local Bond Pooling Act of 1985
Redevelopment Tax Increment Financing
Property Taxes: ad valorem
Proposition 13 (1978) Tax Limitation
Property Tax Special Exemptions and Assessments 
Exemptions: Property owned by the state, local government (most), libraries and museums, certain schools, and churches. California Constitution Article XIII 3
Proposition 58 (1986) & Prop 193 (1996) Intra-Family Transfers California Constitution Article XIIIA 2
Revenue and Taxation Code 63.1
Proposition 60 (1986) & Proposition 90 (1988): Age 55 & over Transfer of Base Value California Constitution Article XIIIA 2
Revenue & Taxation Code 69.5
Proposition 93 (1988) Veterans Assessments California Constitution Article XIII 3
Revenue and Taxation Code 205.1
Proposition 110 (1990) & Prop 177 (1994) Disabled Persons California Constitution Article XIIIA 2
Revenue & Taxation Code 69.5
Proposition 160 (1992) Service Related Deaths California Constitution Article XIII 4
Revenue and Taxation Code 205.5
Homeowner's Property Tax Relief. $7,000 per dwelling homeowner exemption, state subventions reimburse local government. California Constitution Article XIII, 3(k)
Revenue and Taxation Code 218
Government Code 16120-16123 & 29100.6.
Tax Equity Allocation to certain non-full-service, no and low property tax cities. Revenue and Taxation Code 98
Timberland Productivity Act: Preferential property tax treatment of timber. Government Code 51100 et seq.
Williamson Act: Contracts to preserve farmland and open space, reduced property taxes, state reimbursements to local gov't. Contracts: Government Code 51200 et seq.
Subventions: Government Code 16140 et seq.
Reassessments: Revenue and Taxation Code 421
Possessory Interest Tax: Private possessory interests in real property owned by government entities are taxable.
AB8 (Greene 1980) Property Tax Allocation
Educational Revenue Augmentation Fund (ERAF)
The "Triple Flip": temporary shift of cent local sales tax to finance state Economic Recovery Bonds with local reimbursement from property tax share.
The VLF for Property Tax Swap of 2004
Proposition 1A of 2004
Vehicle License Fee revenue protected California Constitution Article XI 15
Property tax, sales tax, transactions & use tax protected California Constitution Article XIII 25.5
State mandate reimbursement California Constitution Article XIIIB 6
Community Redevelopment Law (property tax increment)
Property Tax Administration fees: charges to cities and special districts for county property tax administration.
Local Sales and Use Taxes
Bradley-Burns Uniform Local Sales and Use Tax Law.
    
Sales tax sharing.
The "Triple Flip": temporary shift of cent local sales tax to finance state Economic Recovery Bonds with local reimbursement from property tax share.
Transactions and Use Tax: Local Add-on Sales Taxes.
Other Local Taxes
Parcel Taxes (2/3 vote): requirements and procedures
Mello-Roos Community Facilities Act of 1982
     
Community Facilities District Establishment
Documentary Real Estate Transfer Tax
Business License Tax
Payroll Tax
Transient Occupancy Tax (Hotel Tax)
Other Excise Taxes including utility users tax, real property transfer tax (charter cities), admissions tax, development tax.
Assessments and Financing Districts
Improvement Act of 1911
Municipal Improvement Act of 1913
Improvement Act of 1915
Landscape and Lighting Assessment Act of 1972
Benefit Assessment Act of 1982
Parking and Business Improvement Area Law of 1989
Property & Business Improvement District Law of 1994
Infrastructure Financing Districts (IFDs) can use property tax increment for pubic works.
Integrated Financing Districts allow the initial developer to build public works and get repaid by later builders.
Fees, Charges and Rates
Local government fees may not exceed costs
Developer Fees (AB1600)
Uniform Procedures Standby Charge Procedures Act
Quimby Act: local parkland dedication requirements
School Developer Fees
Regulatory Fees: Police power of cities and counties.
State Grants and Aid
Motor Vehicle Fuel Tax; Gasoline Tax; Highway Users Tax
 (state imposed, a portion subvened to municipalities)
Vehicle License Fee (VLF) state imposed tax on motor vehicles   in lieu of local property taxes.
Proposition 172 (1993) cent sales tax for local public safety (mitigation for ERAF) state subvention.
Proposition 42 (2002) Sales Tax on Gasoline.
Homeowner's Property Tax Relief. $7,000 per dwelling homeowner exemption, state subventions reimburse local government.
Williamson Act: Contracts to preserve farmland and open space, reduced property taxes, state reimbursements to local gov't.
Jail Booking Fees - Criminal Justice Admin Fees
Citizens Option for Public Safety (COPS) state subvention; Supplemental Law Enforcement Funds (SLESF)
State mandated local programs
Other
Proposition 1A of 2004
Vehicle License Fee revenue protected California Constitution Article XI 15
Property tax, sales tax, transactions & use tax protected California Constitution Article XIII 25.5
State mandate reimbursement California Constitution Article XIIIB 6
Proposition 4 (1979) Appropriations Limit
     ("Gann Limit")
Debt Limit
Gift of public funds prohibited
State mandated local programs
Community Redevelopment Law
Fines and Forfeitures
Penal Code 1463 et seq. and 1203 and various others. Vehicle Code 40200.3 (parking violations)