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As the country held its breath waiting for the Midwest ballots to be counted at the beginning of November, California's local governments let out a collective sigh of relief with the overwhelming passage of Proposition 1A.
For Cupertino, the passage of the ballot initiative—which keeps the state from siphoning off local revenues unless first approved by the legislature—means more security for the city's bottom line.
"It puts in a lot more certainty about the future of our budget," said Ralph Qualls, Cupertino's director of public works.
Previously, the state could take money from the city's sales and property tax funds and vehicle license fees at its own discretion. Cupertino has lost over $1 million dollars to this practice over the last three years. The loss is particularly painful since sales taxes accounts for 35 percent of the city's general fund, and have been on the decline anyway since the downturn of the economy in 2000.
"Last year, [the state legislature] ended up taking out a huge amount in vehicle license fees," said Qualls, who also serves on the board of the League of California Cities, an advocacy group of city officials that lobbied hard for the passage of Prop. 1A.
However, Prop. 1A now protects against the removal of vehicle license fees and also safeguards local funding for such city-operated services as health, safety, library, parks and other programs. It also protects property tax and other tax revenues from the state, unless the governor declares a fiscal emergency for taking the funds, and gets two-thirds of the legislature to approve it.
"If they do take away any money, they have to pay it back within three years," said Dave Knapp, Cupertino's city manager. If the state does not repay the money within that time frame, it cannot borrow such money again.
When the state took city funds in the past, Qualls said the city was uncertain whether it would see the money again.
Knapp said voters approving Prop. 1A did not surprise him.
According to www.smartvoter.org, 83.6 percent of the state voted for it.
"Something had to happen," Knapp said, "and it sounds like the voters got the message."
In September, Cupertino's city council also unanimously passed a resolution in favor of Prop. 1A.
Hugh Biggar contributed to this article.
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