General Subject: Local government finance: property tax revenue allocation: vehicle license fee adjustments: County of Orange.

Existing property tax law requires the county auditor, in each fiscal year, to allocate property tax revenue to local jurisdictions in accordance with specified formulas and procedures, and generally requires that each jurisdiction be allocated an amount equal to the total of the amount of revenue allocated to that jurisdiction in the prior fiscal year, subject to certain modifications, and that jurisdiction's portion of the annual tax increment, as defined. Existing property tax law requires that, for purposes of determining property tax revenue allocations in each county for the 1992–93 and 1993–94 fiscal years, the amounts of property tax revenue deemed allocated in the prior fiscal year to the county, cities, and special districts be reduced in accordance with certain formulas. It requires that the revenues not allocated to the county, cities, and special districts as a result of these reductions be transferred to the Educational Revenue Augmentation Fund in that county for allocation to school districts, community college districts, and the county office of education. For the 2004–05 fiscal year and each fiscal year thereafter, existing law requires that each city, county, and city and county receive additional property tax revenues in the form of a vehicle license fee adjustment amount, as defined, from a Vehicle License Fee Property Tax Compensation Fund that exists in each county treasury. Existing law requires that these additional allocations be funded from ad valorem property tax revenues otherwise required to be allocated to each county's Educational Revenue Augmentation Fund for the benefit of educational entities. This bill would modify these reduction and transfer provisions by increasing the vehicle license fee adjustment amount for the County of Orange by $53,000,000 for the 2013–14 fiscal year and requiring that amount to be included in the calculation of the vehicle license fee adjustment amount for that county for each fiscal year thereafter. This bill would direct the Department of Finance and the Chancellor of the California Community Colleges to work with the County of Orange, the county auditor-controller for the County of Orange, and intervenors in obtaining a final and complete resolution to a specified case in which all parties agree not to seek appellate review. The bill would include findings and declarations that an appropriate resolution would be for the County of Orange to repay specified amounts over a specified period. By changing the manner in which property tax revenues are allocated by the county officials in the County of Orange, this bill would impose a state-mandated local program. Existing law, for the 2009–10 fiscal year and for each fiscal year thereafter, requires the auditor of a qualified county, as defined, to increase the total amount of ad valorem property tax revenue otherwise required to be allocated to that county by the county equity amount, as defined, and to commensurately reduce the total amount of ad valorem property tax revenue otherwise required to be allocated to the Educational Revenue Augmentation Fund in the county, as specified. This bill would repeal these provisions. This bill would make legislative findings and declarations as to the necessity of a special statute for the County of Orange. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that, if the Commission on State Mandates determines that the bill contains costs mandated by the state, reimbursement for those costs shall be made pursuant to these statutory provisions.