Laserfiche WebLink
– 3 – rev January 7, 2022 <br /> <br />CaliforniaCityFinance.com <br />voters in 2022 and placed at risk by this initiative is at least $1.5 billion, including $1.0 billion from <br />cities and $500 million from counties and special districts.2 <br />1.b. Additional Costs and Public Service Effects of the Tax Provisions <br />In addition to service delays and disruption due to new tax revenues placed at greater legal risk, there will <br />be substantial additional costs for legal defense. The deterrence of taxes for annexations will delay and <br />deter municipal annexations. <br /> <br />2. “Exempt Charges” (fees and charges that are not taxes) and Services Threatened <br />With regard to fees and charges adopted after January 1, 2022, Initiative 21-0042A1: <br /> Subjects new fees and charges for a product or service to a new "actual cost” test defined as “(i) the <br />minimum amount necessary to reimburse the government for the cost of providing the service to the <br />payor, and (ii) where the amount charged is not used by the government for any purpose other than <br />reimbursing that cost. In addition, subjects these same charges to a new, undefined, “reasonable” <br />standard. <br /> Subjects fees and charges for entrance to local government property; and rental and sale of local <br />government property to a new, undefined, “reasonable” test. <br /> Subjects a challenged fee or charge to new, higher burdens of proof if legally challenged. <br /> Prohibits a levy, charge or exaction regulating or related to vehicle miles traveled, imposed as a <br />condition of property development or occupancy. <br />2.a. Value on New Local Government Fees and Charges at Risk3 <br />Virtually every city, county, and special district must regularly (e.g., annually) adopt increases to fee rates and <br />charges and revise rate schedules to accommodate new users and activities. Most of these would be subject <br />to new standards and limitations under threat of legal challenge. Based on the current volume of fees and <br />charges imposed by local agencies and increases in those fees simply to accommodate inflation, the amount <br />of local government fee and charge revenue placed at risk is about $1 billion per year including those <br />adopted since January 1, 2022. Of this $1 billion, about $570 million is for special districts, $450 <br />million is cities, and $260 million is counties.4 <br />Major examples of affected fees and charges are: <br />1. Nuisance abatement charges - such as for weed, rubbish and general nuisance abatement to fund <br />community safety, code enforcement, and neighborhood cleanup programs. <br />2. Commercial franchise fees. <br />3. Emergency response fees - such as in connection with DUI. <br />4. Advanced Life Support (ALS) transport charges. <br />5. Document processing and duplication fees. <br />6. Transit fees, tolls, parking fees, public airport and harbor use fees. <br />7. Facility use charges, fees for parks and recreation services, garbage disposal tipping fees. <br />In addition to fees and charges, the measure puts fines and penalties assessed for the violation of state and <br /> <br />2 This does not include citizen initiative special tax approved by majority but not two-thirds. Because this approach is new, the <br />number of these measures and amount of revenue involved cannot be estimated. <br />3 Source: California State Controller Annual Reports of Financial Transactions concerning cities, counties and special districts, <br />summarized with an assumed growth due to fee rate increases (not population) of 2 percent annually. <br />4 School fees are also affected but the amount is negligible by comparison.