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As the country was holding its breath waiting for the Midwest ballots to be counted, California's local governments were letting out a collective sigh of relief with the overwhelming passage of Proposition 1A.
For Sunnyvale, this ballot initiative—which keeps the state from siphoning off local revenues unless first approved by the legislature—means Sunnyvale will have enough funds to stay on track with its 20-year budget plan.
Finance Director Mary Bradley said when the city created this year's budget, it banked on 1A passing and that funds they planned for would be around when it came time to use them.
"We've always told the state that we'll find a way to live within our means; we just need them not to change the rules on us," Bradley said.
Passing Proposition 1A means that roughly $2.1 million in Vehicle License fees taken by the state in the past two years will come back during the next fiscal year, which begins in July 2005.
In addition, the initiative protects local funding for necessary services like health, safety, library programs, parks and other city-operated services. It also protects property tax and other tax revenues from the state, unless the governor declares a "fiscal necessity" for taking the funds and gets two-thirds of the legislature to approve it.
Aside from the fiscal benefits of Proposition 1A, Bradley said the number of people who voted for it—83.6 percent of the state according to www.smartvoter.org—is encouraging to cities because it shows people recognize the good they do for their citizens.
"Eighty-four percent is an enormous vote of confidence for local governments," Bradley said. "I think the majority of people in the state know that the majority of their services are coming from their cities."
Bradley said the one uncertainty that remains are state sources for local revenue not mentioned in Proposition 1A, such as those for redevelopment and education.
The week after the election, the state directed cities, including Sunnyvale, to pay $246,142 to elementary, middle and high schools in the area. Cities had to ante up because the state ordered the payment to cover for a decrease in state funding to schools.
By having local cities cover the difference, the state prevents schools from losing funds, but passes the bill onto cities.
Sunnyvale got off easier than surrounding cities because it has such a small Redevelopment Agency. San Jose had to pay almost $19 million and Santa Clara and Milpitas each paid around $3 million.
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