City Council
MEETING DATE: 3/14/2018
TITLE:
Title
Resolution in Opposition to the Proposed Tax Fairness, Transparency and Accountability Act of 2018
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FROM:
Charlie McClendon, City Manager
RECOMMENDATION:
Recommendation
Staff recommends the City Council approve a resolution confirming the Council's opposition to the proposed Tax Fairness, Transparency and Accountability Act of 2018.
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BACKGROUND:
The League of California Cities has raised concern recently related to a potential initiative that could dramatically change the requirements for the adoption of local tax measures. The initiative is currently called the Tax Fairness, Transparency and Accountability Act of 2018. It would apparently require a supermajority (minority rule) on any tax measure and could potentially affect rules governing the adoption of fees and also might affect the imposition of taxes in newly annexed areas. Council discussed the initiative during study session on February 28, 2018 and asked staff to prepare a resolution confirming Council's opposition to the initiative.
DISCUSSION:
The League of California Cities has identified the following troubling provisions in the proposed initiative:
Restricting Local Tax Authority:
a) Eliminates local authority to impose a tax for general purposes by majority vote and
instead requires all local proposed tax increases subject to a two-thirds vote. This
proposal also requires two-thirds approval of all members of the local legislative body
before a tax can be placed on the ballot.
b) Requires a two-thirds vote to "extend" a tax to new territory, a new class of payor, or
expanded base. For cities, this would limit all future annexations by requiring a
separate two-thirds vote of the affected residents prior to applying any existing city
tax. Other limitations may apply to a local interpretation that an existing local tax
applies to a business or product.
c) Expands the definition of a tax to include payments voluntarily...
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