JURUPA VALLEY – Governor Jerry Brown signed legislation that will restore millions of dollars in revenue taken away from four cities in Riverside County and used to pay for public safety realignment programs.
“With this bill, millions of tax dollars will flow to benefit the people of Eastvale, Jurupa Valley, Menifee and Wildomar,” Brown said during a bill-signing ceremony at Jurupa Valley City Hall.
Senate Bill 130, authored by members of the Senate Committee on Budget & Fiscal Review, will boost aggregate vehicle-license-fee-in-lieu-of-property-tax-revenue allocations to the four cities by $17 million to $19 million in the next fiscal year and lower amounts thereafter, according to the legislation.
“I thank the governor for recognizing the critical nature of this funding for our cities, particularly with respect to keeping our neighborhoods and families safe,” Sen. Richard Roth, D-Riverside, said. “This has been an issue I have fought for since before I was even elected, and I am proud to have partnered with Assemblywoman (Sabrina) Cervantes in delivering this major victory for our cities.”
Menifee City Council members were present to witness the reinstatement of the city’s $4.5 million annual revenue stream that is critical for city services.
“After many attempts to reinstate vehicle license fees back to Menifee, we are ever so grateful to receive these funds to pay for critical services, Councilwoman Lesa Sobek said. “We never gave up hope, and we extend our sincerest gratitude to the senator and assemblywoman for their vigilant efforts, as this was not about party politics for the city, but a real local issue affecting our ability to provide services.”
Early long-term budget projections showed that two sources of revenue were needed to close the $20 million deficit for status quo services. In November 2016, Menifee residents passed Measure DD, a 1 percent sales tax measure for public safety, infrastructure, road repairs and maintenance to help bridge the funding gap and not cut critical services. With the recent reinstatement of the vehicle license fees, the city now has the second required funding stream to add additional services to keep pace as the fastest growing city in southwest Riverside County.
“With the funding gap for the Scott Road Interchange growing smaller, the reinstatement of the VLF could not have come at a better time,” Mayor Neil R. Winter said. “As a city council, we assure our residents that these funds will be used with the resident’s best interest in mind, and now with both Measure DD funding and with the VLF reinstatement, we can finally start the process to close the $20 million deficit created from the loss of VLF and rising public safety costs.”
Cervantes, D-Corona, called the ratification of SB 130 “momentous” and critical to providing “public safety services and the community benefit programs that our residents seek and deserve.”
The bill was reportedly one of the measures for which Cervantes and Roth sought the governor’s support before committing their votes in favor of the divisive $52 billion gas tax package put forward under Senate Bill 1, which Brown signed into law last month.
SB 130 amends the California Revenue & Taxation Code to ensure that cities which incorporated between Jan. 1, 2004, and Jan. 1, 2012, receive funding based on a formula in effect prior to the ratification of Senate Bill 89 in June 2011.
“The governor’s signing of this bill re-establishes a recurring funding source to replace the revenue source that was taken by the state in 2011 when the governor signed Senate Bill 89,” Wildomar City Manager Gary Nordquist said. “The new source of funding, when implemented will increase the city’s revues by over 20 percent. State Sen. Richard Roth had been working for five years and was recently joined with Assemblywomen Sabrina Cervantes to restore this revenue source for the newly incorporated cities.”
SB 89 subtracted more than $15 million in tax increment reserved for newly incorporated municipalities and diverted the money to a law enforcement services account from which grants were obtained and awarded statewide to offset the cost of Assembly Bill 109, which shifted many state responsibilities onto counties, including housing some offenders in county jails instead of state prisons.
Wildomar incorporated July 1, 2008; Menifee incorporated Oct. 1, 2008; Eastvale incorporated Oct. 1, 2010 and Jurupa Valley incorporated July 1, 2011 – two days after SB 89 took effect. The newest city was the hardest hit financially, losing half the funds anticipated in its budget for its first fiscal year.
Multiple attempts were made over the last six years to restore the lost money, but Brown vetoed every bill – even the ones that received overwhelming bipartisan support – citing budgetary concerns and inciting criticism that he was playing politics at the cities’ expense.
Members of the Jurupa Valley City Council at one time discussed suing him over the revenue losses stemming from SB 89 and his refusal to sign other bills that would have restored the funds.
The governor did approve one-time, short-term relief in the form of SB 107 in the fall of 2015. The bill granted authority to the California Department of Finance to provide $24 million in credits to Jurupa Valley, Menifee and Wildomar. Eastvale was excluded from the relief bill, prompting a lawsuit that was ultimately dismissed.
The funds were to cover Riverside County’ s expenses providing law enforcement and fire services to the startup cities; all of which went into debt to the county during their initial years because they didn’t receive the anticipated VLF allocations.
SB 130 will provide an ongoing stream of funding under a formula designed specifically to address the tax increment receipts they lost. The funds will be available in fiscal year 2017-18 and is not retro-active.
Kim Harris contributed to this article.