AWC Legislative Bulletin - Volume 31, No. 2
January 18, 2008  (Plain Text Version)

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In this issue:
What you Need to Know Now
From the Director: I-960 Causes Chilling Effect for Introduction of Tax or Fee Legislation
Energy & Telecommunications
Environment & Water
General Local Government
Infrastructure, Transportation & Economic Development
Land Use & Housing
Law & Justice
Municipal Finance
Personnel & Labor Relations
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AWC Legislative Contacts & Officers
City Legislative Action Conference (CLAC)

From the Director: I-960 Causes Chilling Effect for Introduction of Tax or Fee Legislation

By Stan Finkelstein, AWC Executive Director

As reported in last week’s Bulletin, we expect relatively few major new policy initiatives in 2008 due to the short session, a desire to save money and the upcoming elections.

After one week of the session it is clear that I-960 has provided another disincentive for major new policies which usually require new money or a shift of existing resources.

I-960 addresses tax and fee increases imposed by state government and was approved by the voters this past November. While the initiative does not directly impact cities, we had anticipated significant secondary impacts given the constraints it placed on the State. Now that the session has begun, we have experienced a chilling effect on legislators to even introduce legislation subject to the Initiative’s provisions. This has already had a significant impact on the outlook for several of AWC’s legislative priorities, including funding for infrastructure.

The Initiative requires voter approval or two-thirds of both the Senate and House to increase taxes for all state government funds, not just the previous I-601 two-thirds requirement for general fund tax increases. In addition, it requires an advisory vote during the next general election for all revenue increases approved by the Legislature that are not otherwise approved by the voters, such as any bill with an emergency clause which is not subject to referendum and any bill not otherwise sent to the voters for approval. This requirement may also be triggered by money shifts between the state’s more than 300 funds.

Legislative approval is also required for all state fee increases.

The Initiative also expanded the current legislative fiscal note process to include additional public notification when the Legislature considers tax or revenue bills, including legislative voting records on proposals, and a 10-year estimate of the costs of each bill for all versions of the proposed bills at each state of the legislative process. Hence, the Office of Financial Management sends out a notice each time a fiscal bill moves from one committee to another and/or from one house to another. The publicity surrounding the first of these fiscal notes was tremendous and has resulted in far less willingness by legislators to even introduce proposals that would trigger I-960’s notice provisions.

Some have questioned the constitutionality of this Initiative, but no legal challenges have been filed.

AWC staff will continue to advance our priorities, including those with a fiscal impact, and we ask that you continue to remind your legislators of your need for additional resources whether they are for operating purposes or new economic development or infrastructure programs. It simply may take us a few years to accomplish our objectives.