Governor promises city funds are safe--for now

By Oakley Brooks

Even as Gov. Gray Davis pledged recently that the current state budget crisis would not swallow state funds that provide nearly 10 percent of Saratoga's annual budget, lobbyists from the League of California Cities pushed ahead with a state constitutional initiative that would protect local budgets in lean years.

Saratoga receives roughly $1.5 million annually from the statewide collection of vehicle registration fees. That money forms a significant portion of the city's roughly $15 million to $16 million annual revenue, and it helps pay for law enforcement and road maintenance, among other services, throughout Saratoga.

Similarly, small cities and towns throughout the state rely on vehicle license money.

But Saratoga officials and those in other California local governments have worried this fall that a worsening state budget deficit--projected to be $12.4 billion because of the one-two punch of the energy crisis and a sinking economy--would cause state legislators to use a portion of vehicle license money to bring the state back to fiscal health.

Gov. Davis told a League of California Cities' convention Dec. 19 that he would work to protect local governments' share of vehicle license money.

"I will not balance the budget on the backs of local government," Davis said--a promise he repeated just last week in his State of the State address. "I will fight to see you receive funds from the vehicle license fee to provide important services," he repeated.

Saratoga officials were relieved by the announcement: "Losing even a portion of [vehicle funds] would mean severe cutbacks in service to our community," Mayor Nick Streit said.

But at the same convention where Davis showed his support, city representatives continued to show a distrust of state legislators on budgetary issues. The league resolved to further protect its funding by putting a state constitutional amendment before California voters at the end of this year.

The amendment would require the state to leave local police, fire and other emergency funds untouched even in times of budgetary crisis.

It would also mandate that the state reimburse cities and counties if it needs local property and sales taxes to balance the California budget.

Under one version of the amendment, state legislators could suspend reimbursements in times of crisis for a period of two years.

The voter-driven constitutional amendment is a serious undertaking: Over the next year the league must gather 670,000 signatures statewide to get the measure on the November 2002 ballot. League spokeswoman Megan Taylor says the organization has never attempted such a campaign in more than 100 years of operation.

But cities still have a fresh memory of the state's raid of property taxes to balance its education budget in 1991-'92, and Taylor says they have seen no initiative within the state legislature to guard against similar moves in the future.

"We feel like we're up against a wall," she says.

Councilman Stan Bogosian, Saratoga's representative at the recent league convention, says he also believes that the constitutional amendment would be a sturdy protector for local budgets.

"We can't depend on the state legislature to do it," he adds. "It's the fox guarding the henhouse."

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