Local Officials to State: Hands Off Our Revenues!

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(Sacramento, CA)
Wednesday, May 20, 2009

The special election is over, but the state’s financial crisis isn’t going anywhere.  The governor and lawmakers now have to figure out how to close an ever-widening budget gap.  And many city and county officials are worried the state could seize local revenues.
It’s widely acknowledged as one of the state’s last resorts: raiding property tax revenues that belong to cities, counties and special districts.  The state would have to pay every penny back – with interest – within three years.  But these days, even last resorts are on the table.  And the Schwarzenegger administration has already floated the prospect of borrowing $2 billion to shore up the state budget.
Sacramento Mayor Kevin Johnson says his city simply can’t afford that – and offered this advice to state officials:
Johnson: “Look – do not have this be one of your options.  This doesn’t set well with us, and we’d like you to come up with some other option other than you as the state going into the pockets of the cities.” 
The city of Sacramento would lose $12 million if the state hangs onto that money.  For Sacramento County, the number would be $32 million.  And that’s on top of the huge deficits they already face.  Sacramento County Supervisor Susan Peters says programs like healthy families, welfare and public health programs would be directly impacted.
Peters: “We’re not going to take it sitting down.  We can’t generate money like the state can, and we at the local government level actually have to enact the things that are passed by the state government.” 
Other city and county officials have similar frustrations.  But in the end, all they can do is lobby and hope.  The governor and state lawmakers have the final word.  Local governments must balance their budgets by the end of June – regardless of whether the state has passed its own spending plan.