Part of Governor Jerry Brown's idea to balance the state budget is to shed the state of funding responsibilities for several local programs. Ever since the days of Proposition 13, California's watershed property tax slashing measure passed by the voters in 1978, the state has assumed more and more responsibility for funding local programs.
Today, 70 percent of all state dollars go to local governments for services ranging from public education to county hospitals.
But with recession-caused lost revenues, the state no longer as the money or the means to continue funding local programs at historic levels. That's part of the reason the state has a $25 billion budget gap.
Enter realignment. Brown's idea is to return control of state-funded local programs to the cities and counties. That's the easy part. The hard part is creating ways for local governments to fund their programs.
One idea, elimination of local redevelopment agencies, has already been broached. By ending these agencies, local governments would have extra property tax dollars to use for schools, police, fire protection, libraries, public hospitals, and the panoply of local services. That proposal has already generated opposition.
Another idea would be to alter Proposition 13 by lifting the one percent cap on businesses while maintaining the cap for homeowners. You can imagine the reaction in anti-tax quarters, given the sanctity of Proposition 13 to so many people.
A third proposal is to broaden the sales tax to services, with the extra money remaining in the hands of local governments.
That's likely to be a tough sell as well because it expands the tax base.
A fourth idea is to make it easier for voters to raise their own taxes by lowering the two-thirds vote to a majority vote.
Which, if any, of these proposals will fly remains to be seen. But one fact is clear: Shifting responsibilities for programs to local governments won't work unless they have their own revenue sources.
In an anti-tax environment, any of the proposals cited above will face tremendous opposition. Brown has to convince the legislature and voters alike that by controlling their own destiny, they can decide what programs and services to keep and at what levels of funding. It's a risky proposition for the governor, but then again, unless he cuts out a full thirty percent of the state budget, he won't have much choice.
