BILL NUMBER: SBX1 6ENROLLED BILL TEXT PASSED THE SENATE DECEMBER 18, 2008 PASSED THE ASSEMBLY DECEMBER 18, 2008 AMENDED IN ASSEMBLY DECEMBER 18, 2008 INTRODUCED BY Senator Ducheny DECEMBER 8, 2008 An act to amend Section 29530 of the Government Code, and to add Section 7203.25 to the Revenue and Taxation Code, relating to local government finance. LEGISLATIVE COUNSEL'S DIGEST SB 6, Ducheny. County sales and use taxes: rate increase. The Bradley-Burns Uniform Local Sales and Use Tax Law (Bradley-Burns Law) authorizes a county and a city and county to impose a local sales and use tax, and similarly authorizes a city, located within a county imposing such a tax rate, to impose a local sales tax rate that is credited against the county rate. Existing law requires a city, county, or city and county imposing a local sales and use tax pursuant to the Bradley-Burns Law to contract with the State Board of Equalization to administer the local sales and use tax. Existing law authorizes a county or city and county to contract with the State Board of Equalization to establish a local transportation fund in the county treasury for the deposit of 1/4 of 1% of the revenues collected for the county or city and county under the Bradley-Burns Law for specified transportation purposes. This bill would authorize a county or city and county to impose an additional 1/4 of 1% sales and use tax rate under the Bradley-Burns Law. This bill would require a county or city and county that imposes this additional rate to deposit all revenues derived therefrom, less specified administrative costs, into a local transportation fund, as specified. This bill would also require a county or a city and county that imposes this additional tax to comply with the applicable voter-approval requirements of a specified provision of the California Constitution. The California Constitution authorizes the Governor to declare a fiscal emergency and to call the Legislature into special session for that purpose. The Governor issued a proclamation declaring a fiscal emergency, and calling a special session for this purpose, on December 1, 2008. This bill would state that it addresses the fiscal emergency declared by the Governor by proclamation issued on December 1, 2008, pursuant to the California Constitution. This bill would become operative only if Assembly Bill 2 of the 2009-10 First Extraordinary Session of the Legislature is chaptered THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Section 29530 of the Government Code is amended to read: 29530. (a) If the board of supervisors so agrees by contract with the State Board of Equalization, the board of supervisors shall establish a local transportation fund in the county treasury and shall deposit in the fund all revenues transmitted to the county by the State Board of Equalization under Section 7204 of the Revenue and Taxation Code, which are derived from that portion of the taxes imposed by the county at a rate in excess of 1 percent, and on and after July 1, 2004, until the rate modifications in subdivision (a) of Section 7203.1 of the Revenue and Taxation Code cease to apply, at a rate in excess of three-quarters of 1 percent, pursuant to Part 1.5 (commencing with Section 7200) of Division 2 of that code, less an allocation of the cost of the services of the State Board of Equalization in administering the sales and use tax ordinance related to the rate in excess of 1 percent, and on and after July 1, 2004, until the rate modifications in subdivision (a) of Section 7203.1 of the Revenue and Taxation Code cease to apply, to the rate in excess of three-quarters of 1 percent, and of the Director of Transportation and the Controller in administering the responsibilities assigned to him or her in Chapter 4 (commencing with Section 99200) of Part 11 of Division 10 of the Public Utilities Code. (b) (1) The board of supervisors of a county or city and county that imposes a tax pursuant to Section 7203.25 of the Revenue and Taxation Code shall contract with the State Board of Equalization to establish a local transportation fund in the county or city and county treasury, and shall deposit in the fund all revenues transmitted to the county or city and county by the State Board of Equalization under Section 7204 of the Revenue and Taxation Code that are derived from that portion of the taxes imposed by the county or city and county under Section 7203.25 of the Revenue and Taxation Code, less an allocation of the cost of the services of the State Board of Equalization in administering the sales and use tax ordinance related to that rate and the Director of Transportation and the Controller in administering the responsibilities assigned to him or her in Chapter 4 (commencing with Section 99200) of Part 11 of Division 10 of the Public Utilities Code. (2) The board of supervisors of a county or city and county that has established a local transportation fund under subdivision (a) is deemed to have established the local transportation fund described in paragraph (1). The board of supervisors shall deposit into that fund all revenues described in paragraph (1). (c) Any interest or other income earned by investment or otherwise of the local transportation fund shall accrue to and be a part of the fund. SEC. 2. Section 7203.25 is added to the Revenue and Taxation Code, to read: 7203.25. (a) Notwithstanding any other provision of law, on and after the effective date of this section, a county and a city and county may, for the purposes specified in subdivision (b) of Section 29530 of the Government Code, impose a sales and use tax rate of one-quarter of 1 percent, in addition to the rates authorized by Sections 7202 and 7203, for the privilege of selling tangible personal property at retail in the county or city and county, and upon the storage, use or other consumption in the county or city and county of tangible personal property purchased from any retailer for storage, use or other consumption in the county or city and county. (b) A county and city and county that imposes a tax pursuant to subdivision (a) shall comply with both of the following: (1) All other applicable provisions of this part. (2) The applicable voter-approval requirements of Section 2 of Article XIII C of the California Constitution when the county or city and county imposes, extends, or increases the tax authorized by this section. SEC. 3. This act addresses the fiscal emergency declared by the Governor by proclamation on December 1, 2008, pursuant to subdivision (f) of Section 10 of Article IV of the California Constitution. SEC. 4. This act shall become operative only if Assembly Bill 2 of the 2009-10 First Extraordinary Session of the Legislature is chaptered.