Governor enacts TEA law, will bring the city $400,000 yearly
By Kara Chalmers
Gov. Gray Davis has enacted a law that will allow Saratoga to get back tax equity allocation (TEA) funds, which will mean an additional $400,000 in revenue yearly for the city, beginning in 2003.
TEA funds are matching funds from the county collected from property taxes. The city lost these funds when voters repealed the utility-users tax in Nov. 1996. Because the city now has a local tax--the $15 million general obligation bond measure for a new library that voters passed in March--the city is once again eligible, according to the new law.
When voters repealed the utility-users tax, Saratoga lost $729,000 in tax revenue, and it lost the TEA funds that the county used to match the tax--55 percent of the tax, or $400,000.
While the city has never stopped receiving TEA funds--it still gets a base of $550,000 each year--the law will allow the city to get an additional $400,000 to bring the total close to what the city received before the utility-users tax was repealed. It will allow the city to collect matching funds on the property taxes collected for the library bond, up to the amount taken in pre-1996.
Senate Bill 1883 was introduced by state Sen. Byron Sher in February. Sher said he authored the bill so that the cities in Santa Clara County which lost property tax revenue to the county would have it reallocated.
According to Sher, there are three other cities the law will effect--Los Altos Hills, Cupertino and Monte Sereno, which are cities that fall into the category of "no-low" property tax cities, meaning they do not receive a large amount of residents' property taxes. Now, those funds will be paid to the cities and will therefore not go into the county's general fund, that is used on countywide projects.
The bill passed the Senate and Assembly by unanimous vote and Davis signed the bill into law on Sept. 12.
Sher said no one, not even the county, opposed what he said is an equitable solution for these four cities.
Another law in effect since January 1998, which was designed to help out cities that had lost TEA funds due to voters repealing local taxes, was amended shortly before a vote was taken on the bill to exclude Santa Clara County.
Sher said the passage of SB 1883 rectifies an inequity in the law that allowed this type of reinstatement for all other cities in the state except for those in Santa Clara County.
"That's why the case was very strong for rectifying that," Sher said.
According to the city's Administrative Services Director Mary Jo Walker, the funds will go into the general fund and will allow the city to improve local services, such as police protection.
|
Saratoga, California Since 1955
