State should keep hands out of transportation fund cookie jar
Andy Pugno, The Folsom Telegraph
Jul 29, 2009
California is in a fiscal straightjacket. And it belongs in one.
This year’s unprecedented budget shortfall has resulted in yet another dire financial situation. Like a predictable movie sequel, the Golden State finds itself crippled by the impotence wrought by an insatiable appetite for spending, entitlement and political expediency.
California is on the verge of a fiscal meltdown. It has no credit and no cash. And once again, it is turning to local governments for a bailout.
I am referring specifically to the state’s plan to raid local HUTA (Highway User Tax Act) funds to solve the state’s budget crisis. A plan that by its very nature is illegal, unfair, irresponsible and unconstitutional.
To understand this, one must take into account the reasons why we have a gas tax in the first place.
These funds are intended to mitigate the damage done to our transportation infrastructure through overuse by properly linking repair and maintenance to a user-based fee in the form of a gas tax.
The theory is that for every mile that we drive, we are paying our fair share to ensure that the collective damage done by years of driving is offset through a direct funding mechanism.
The bottom line is transportation dollars are designed to fill the potholes in our roads, not the state budget.
I am very familiar with the California State Constitution. I have read it. I have argued the constitutionality of laws in accordance with it. I have helped amend it.
But I have always defended it. The fact is that the authorization to allow the state to seize local shares of transportation dollars to pay off state bonds and backfill the general fund does not exist.
Throughout the years, lawmakers have tinkered with the gas tax funding mechanism as a way to pay off various bonds, debts and state programs.
In 1974 voters approved Proposition 5 which allows the state to use up to 25 percent of gas tax revenue to pay off state accumulated debt and restricts changing the allotment of tax revenue local governments receive.
In essence, since 1974, local governments have always received their share of the gas tax pie despite changes in how the pie was divvied up.
In 1998, we saw increasingly desperate maneuvers by our state to use the gas pump as an ATM machine.
Proposition 2 was a measure placed on the ballot by lawmakers to allow the state to borrow revenue received from the state transportation tax for a period of up to three years.
Despite this radical shift in public policy and transportation funding, authorization was never granted to allow the state to seize the local share of transportation dollars to pay for debt or general fund services.
The burden of proof is on the state if they choose to use local transportation dollars to pay for state malfeasance.
The authorization for the state to rob local governments of transportation funding simply doesn’t exist. It is a fact.
Proposition 5 passed in 1974, and Proposition 2 in 1998, ensure this.
State lawmakers need to focus on solving California’s own budget crisis instead of trying to strap these problems onto the backs of cities and counties.
This budget is bad for California and bad for cities and counties that provide the services that taxpayers really care about.
Andy Pugno is a Folsom attorney and businessman who has represented local government entities for nine years.