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The state taketh $1,034,872 from Manteca and the California Statewide Communities Development Authority giveth back.
The Manteca City Council Tuesday is expected to sign an agreement with the authority that essentially makes it whole in terms of property tax the state is pilfering this fiscal year
The authority was established by the League of California Cities and California State Association of Counties to provide access to low-cost, tax-exempt financing for public benefit projects.
The city under Proposition 1A requires the state to repay the money they borrow – plus interest – from the property tax receipts of cities and counties by June 30, 2013.
Under the agreement, the city would be paid the amount of money the state took in two equal installments – one on Jan. 15, 2010 and the other on May 3, 2010. That means the city won’t have to make additional cutbacks other than those already in place. If not for the authority – or the offer of the South San Joaquin Irrigation District to do the same – the city would have had to make roughly 10 to 15 more layoffs of municipal workers to balance the budget.
The state, under the agreement, would pay the authority directly.
The authority expects to have no problem selling the bonds needed to pay the cities and counties even though the state couldn’t borrow more money to balance the budget.
The reason is simple. It is essentially a secured debt. The courts have been clear that the state – as well as any local government jurisdictions – has to repay bonds and other such obligations first and foremost.
There is essentially minimal risk to lenders who are guaranteed payment by the state.
Manteca has balanced the budget for the current fiscal year with employee concessions, using $3.7 million in operating reserves, spending $1.2 million in interest from the business tax collected on construction of single family home, reorganization, leaving positions vacant, and cutting back other expenses.
Sacramento, though, is again making sounds of tapping into municipal pockets.
Sacramento already has developed a $1.1 billion revenue shortfall just 13 weeks after adopting a budget. That deficit is expected to swell to $7.4 billion by June 30, 2010.
The state may take away special law enforcement funding known as COPS, reduce booking reimbursement, divert Proposition 172 public safety sales tax, and suspend Police Officers Standard Training reimbursement. If any of that happens it would reduce the general fund further forcing more local cuts.
Manteca – like other jurisdictions – is also getting hammered by the state delaying payments of money collected for city purposes. One example is the Highway Users Tax Allocations that are commonly known as gas tax funds. That money funds 100 percent of the street maintenance crew and routine maintenance. The city, instead of getting gas tax they should have in their hands now, won’t receive it until January 2010.
That is creating a cash flow problem for the city when it comes to painting the streets as well as general street maintenance.
The Manteca City Council Tuesday is expected to sign an agreement with the authority that essentially makes it whole in terms of property tax the state is pilfering this fiscal year
The authority was established by the League of California Cities and California State Association of Counties to provide access to low-cost, tax-exempt financing for public benefit projects.
The city under Proposition 1A requires the state to repay the money they borrow – plus interest – from the property tax receipts of cities and counties by June 30, 2013.
Under the agreement, the city would be paid the amount of money the state took in two equal installments – one on Jan. 15, 2010 and the other on May 3, 2010. That means the city won’t have to make additional cutbacks other than those already in place. If not for the authority – or the offer of the South San Joaquin Irrigation District to do the same – the city would have had to make roughly 10 to 15 more layoffs of municipal workers to balance the budget.
The state, under the agreement, would pay the authority directly.
The authority expects to have no problem selling the bonds needed to pay the cities and counties even though the state couldn’t borrow more money to balance the budget.
The reason is simple. It is essentially a secured debt. The courts have been clear that the state – as well as any local government jurisdictions – has to repay bonds and other such obligations first and foremost.
There is essentially minimal risk to lenders who are guaranteed payment by the state.
Manteca has balanced the budget for the current fiscal year with employee concessions, using $3.7 million in operating reserves, spending $1.2 million in interest from the business tax collected on construction of single family home, reorganization, leaving positions vacant, and cutting back other expenses.
Sacramento, though, is again making sounds of tapping into municipal pockets.
Sacramento already has developed a $1.1 billion revenue shortfall just 13 weeks after adopting a budget. That deficit is expected to swell to $7.4 billion by June 30, 2010.
The state may take away special law enforcement funding known as COPS, reduce booking reimbursement, divert Proposition 172 public safety sales tax, and suspend Police Officers Standard Training reimbursement. If any of that happens it would reduce the general fund further forcing more local cuts.
Manteca – like other jurisdictions – is also getting hammered by the state delaying payments of money collected for city purposes. One example is the Highway Users Tax Allocations that are commonly known as gas tax funds. That money funds 100 percent of the street maintenance crew and routine maintenance. The city, instead of getting gas tax they should have in their hands now, won’t receive it until January 2010.
That is creating a cash flow problem for the city when it comes to painting the streets as well as general street maintenance.
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