R 4184RESOLUTION NO. 4184
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO
GRANDE OPPOSING PROPOSALS BY THE STATE TO BORROW
AND/OR TAKE ADDITIONAL LOCAL FUNDING POTENTIALLY
RESULTING IN THE NEED TO DECLARE A LOCAL FISCAL HARDSHIP
FOR THE CITY
WHEREAS, the Governor's office has informed local government representatives of
a proposal under consideration by the State of California to borrow local property tax
revenues to address State budget deficits if voters do not approve Propositions 1A through
1 E at the May 19, 2009 Statewide Special Election; and
WHEREAS, voters of California approved Proposition 1A in 2004 by an 84% margin,
which sent a clear message to the Governor and State Legislature to stop the
irresponsible, damaging and unfair practice of taking local government funds to finance the
State budget; and
WHEREAS, Proposition 1A prohibits the State Legislature from reducing the share
of property tax revenues going to the cities, county and special districts in any county and
shifting those revenues to the schools or any other non-local government function, but
allows borrowing of not more than 8% of the total amount of ad-valorem property tax
revenues for a three year period; and
WHEREAS, the State Department of Finance has estimated this amount to equal
$2.006 billion; and
WHEREAS, it would be irresponsible to "borrow" such funds because it would
deepen the State's structural deficit and cripple local government and transportation
services, a position previously expressed by the Governor; and
WHEREAS, as a result of the current economic recession the City Council of the
City of Arroyo Grande has recently approved preliminary budget strategies to address a
projected budget shortfall of nearly $2,000,000, that significantly impact the City's ability to
provide public safety, infrastructure maintenance and other critical services to the
community; and
WHEREAS, any further diversion of property, sales other local government tax
revenues underthe Proposition 1A loan provisions will further impactthe ability of the City,
as well as other local agencies throughout California, to fund Police, Fire and other critical
services, and therefore will significantly impact the health, safety and welfare of our
citizens ;and
RESOLUTION NO. 4184
PAGE 2
WHEREAS, any such further diversion of local tax revenues has the potential to
cause the City of Arroyo Grande and other cities and local agencies throughout California
to face unprecedented levels of fiscal hardship and possibly even insolvency; and
WHEREAS, this condition has been brought about by the amount of budget
reductions that the City and other local agencies have previously experienced as a result of
prior unfunded State mandates and revenue diversions imposed by the Governor and
Legislature, as well as the current economic downturn.
NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Arroyo
Grande hereby opposes any and all efforts by State government to "borrow" or seize local
tax funds to finance State operations. Such a move would be fiscally irresponsible for the
State, would threaten to create a state of local fiscal hardship for cities and other agencies
throughout California, and would strongly impact the ability to provide adequate public
safety, infrastructure maintenance, and other critical local services.
On motion of Council Member Costello, seconded by Council Member Guthrie, and on the
following roll call vote, to wit:
AYES: Council Members Costello, Guthrie, Fellows, and Mayor Ferrara
NOES: None
ABSENT: Council Member Arnold
the foregoing Resolution was passed and adopted this 12`h day of May 2009.
RESOLUTION NO. ~{~8y
PAGE 3
TONY FER ,MAYOR
ATTEST:
KELLY WE MO ,CITY CLERK
APPROVED AS TO CONTENT:
~~
ST~AMS, CITY MANAGER
APPROVED AS TO FORM:
l /~-- ~ ~.
TIMO HY J. C L, CITY ATTORNEY
OFFICIAL CERTIFICATION
I, KELLY WETMORE, City Clerk of the City of Arroyo Grande, County of San Luis
Obispo, State of California, do hereby certify under penalty of perjury, that the attached
Resolution No. 4184 is a true, full, and correct copy of said Resolution passed and
adopted at a Regular meeting of the City Council of the City of Arroyo Grande on the
12~h day of May 2009.
WITNESS my hand and the Seal of the City of Arroyo Grande affixed this 13t" day of
May 2009.
KELLY WETN}ORE, CITY CLERK