A resolution to propose to the people of the State of California an amendment to the Constitution of the State, by amending Sections 1, 5, 6, and 8 of, and adding Sections 11 and 12 to, Article XIX thereof, relating to transportation.

(1) Article XIX of the California Constitution restricts the expenditure of revenues from taxes imposed by the state on fuels used in motor vehicles upon public streets and highways to street and highway and certain mass transit purposes, and restricts the expenditure of revenues from fees and taxes imposed by the state upon vehicles or their use or operation to state administration and enforcement of laws regulating the use, operation, or registration of vehicles used upon the public streets and highways, as well as to street and highway and certain mass transit purposes. These restrictions do not apply to revenues from taxes or fees imposed under the Sales and Use Tax Law or the Vehicle License Fee Law. Article XIX prohibits the Legislature from borrowing revenues from taxes imposed by the state on fuels used in motor vehicles, and from using those revenues other than as specifically permitted by Article XIX. Article XIX provides that up to 25% of fuel tax revenues allocated to the state may be pledged or used for the payment of principal and interest on voter-approved transportation bonds issued for street and highway purposes on and after November 2, 2010, upon voter approval and appropriation by the Legislature. Article XIX provides that up to 25% of fuel tax revenues allocated to cities and counties may be pledged or used for the payment of principal and interest on voter-approved transportation bonds issued for street and highway purposes. However, in counties where voters have approved the use of fuel tax revenues for certain mass transit purposes, Article XIX provides that the Legislature may authorize any fuel tax revenues allocated to mass transit purposes to be pledged or used for payment of principal and interest on voter-approved bonds issued for those mass transit purposes. This measure would prohibit the Legislature from borrowing revenues from fees and taxes imposed by the state on vehicles or their use or operation, and from using those revenues other than as specifically permitted by Article XIX. The measure would also prohibit those revenues from being pledged or used for the payment of principal and interest on bonds or other indebtedness. The measure would delete the provision that provides for use of any fuel tax revenues allocated to mass transit purposes to be pledged or used for payment of principal and interest on voter-approved bonds issued for those mass transit purposes, and would instead subject those expenditures to the existing 25% limitation applicable to the use of fuel tax revenues for street and highway bond purposes. This measure would also restrict the expenditure of revenues from taxes imposed by the state on motor vehicle fuels used other than in motor vehicles upon public streets and highways, by requiring the use of those revenues for street and highway purposes, but only with respect to the portion of the affected revenues attributable to increases in tax rates that are effective on or after July 1, 2010. This restriction on expenditures would not apply if federal law requires another use of any portion of those revenues. The measure would also prohibit the Legislature from borrowing those revenues or pledging those revenues for debt service. (2) Article XI of the California Constitution requires the revenues derived under the Vehicle License Fee Law from a rate that does not exceed 0.65% of the market value of a vehicle to be allocated to cities and counties, and does not restrict expenditure of those revenues for a particular purpose. This measure would require revenues derived from that portion of the vehicle license fee rate that exceeds 0.65% of the market value of a vehicle to be used solely for street and highway purposes and would prohibit the Legislature from borrowing those revenues. The measure would also prohibit those revenues from being pledged or used for the payment of principal and interest on bonds or other indebtedness. (3) This measure would make other conforming changes.