COUNTY OF SAN MATEO

Inter-Departmental Correspondence

County Manager's Office

DATE:

January 21, 2004

BOARD MEETING DATE:

January 27, 2004

TO:

Honorable Board of Supervisors

FROM:

John Maltbie, County Manager

SUBJECT:

County Manager's Report #2

1.

Resolution to amend the 2003-2004 Legislative Session Program to include a legislative proposal regarding the creation of a countywide special park district

Recommendation

Adopt a resolution to amend the 2003-2004 Legislative Session Program to include a legislative proposal regarding the creation of a countywide special park district.

Background

This proposal would, with voter approval, create a countywide special park district to better coordinate park and recreation services within the county and to provide new sources of revenue for park agencies at both the city and county level.

While many of the details of the proposal have yet to be determined, one purpose of the proposal is to develop a funding mechanism for parks and recreation activities. Other counties that have had such districts approved are San Diego, Santa Barbara, Napa, Marin, Riverside, San Bernardino, Los Angeles and Sacramento.

The creation of this district could provide the following benefits: additional revenue sources, ability to coordinate park facilities to not duplicate specialty activities, identify gaps, provide coordinated information to county residents on what types of facilities are available and where, potential to bundle purchasing or capital projects for better prices; coordination of regional trail implementation and improvements; better regional resource management, ability to qualify for grant sources for which as individual agencies we might not otherwise be qualified; and coordination of wildlife corridors and watershed protection within the County.

While creation of this district will not entirely solve the financial crisis in which many park agencies now find themselves, it would begin to solve the crisis that exists for San Mateo County Parks Division and establish a more reasonable and stable basis for funding for parks.

Discussion

San Mateo County is one of only two counties in the 9-county Bay Area region not to have a dedicated source of funding for acquisition, development and/or maintenance of park facilities. Citizens of San Mateo County have been working since 1992 for tax based funding for its parks.

Parks, as a non-mandated service, are one of the few areas that can be reduced during each budget downturn. County staff estimates an un-funded capital projects need of $78 million for the County parks system. The County Parks operations and maintenance budget has been reduced by 32% over the last two years, with additional cuts anticipated in the future. Most of the cities in the county have also identified un-met needs. Services to be provided by the new district are different from those provided by the Mid Peninsula Regional Open Space District, as the new district would be focused on more traditional recreational uses and not on primarily on preservation of open spaces and agricultural lands.

Vision Alignment

Support of a 2003-2004 Legislative Program amendment to create a countywide special park district would help the County preserve and provide people access to our natural environment and work toward Goals #14 and 15-to preserve our natural resources through environmental stewardship and to provide residents with nearby access to green spaces and recreational opportunities.

Fiscal Impact

Existing staff resources would be used to develop the legislative proposal. The cost of placing the measure before voters has not been determined. It would include the cost of an engineering study to justify the need for a funding mechanism and the cost of an election, which would be in conjunction with a regularly scheduled election, or by mail.

Should San Mateo County voters approve the creation of the special district and funding mechanism, the approved revenue stream would cover the on-going operating costs. If the voters do not approve the new district and funding mechanism, there would be no on-going costs. If approved, it is anticipated that there would be positive fiscal impacts from increased visitation and associated fees and charges and the ability to apply for other types of grant funds.

2.

Resolution to Support of Proposition 56-The Budget Accountability Act of 2004

Recommendation

Adopt a resolution in support of Proposition 56-The Budget Accountability Act of 2004.

Background

Proposition 56 would reduce from 66% to 55% the vote requirement for budget-related taxes and spending. It would also create a reserve fund of up to 5% of General Fund spending. It would also require the Legislature to remain in session until a budget bill is passed and deny salary and expenses for each day the budget is late (not passed by the Constitutional deadline).

Discussion

While proponents and opponents agree on the reserve fund requirement and salary denial, they disagree on the key provision to reduce the vote threshold. Proponents argue that Proposition 56 would end budget gridlock by reducing the vote threshold. Opponents argue that lowering the threshold would make it easier to disregard bipartisan consensus and increase taxes. Proponents counter that education and outreach provisions of Proposition 56 would provide voters information with which to hold the Legislature accountable.

With the difficulty of securing a two-thirds vote, the State Legislature typically approves the state budget well beyond the Constitutional deadline of June 30. This often requires the County to revise its own budget in response to the state's tardiness. While the purpose of a two-thirds vote requirement is, in part, to ensure broader consensus, the required vote has been secured through member-specific concessions (such as members requests).

The Legislative Committee has reviewed Proposition 56 and recommends the Board's support.

Vision Alignment

Support of Proposition 56 would help the County to provide responsive, effective and collaborative government and work toward Goal #20-to ensure that government decisions are based on careful consideration of future impact, rather than temporary relief or immediate gain.

Fiscal Impact

The fiscal impact would vary depending on the actions of the legislature. However, the LAO notes that Proposition 56 "would make it easier in some years to approve tax increases related to the budget."

3.

Resolution in Support of Proposition 58-The California Balanced Budget Act

Recommendation

Adopt a resolution in support of Proposition 58-The California Balanced Budget Act.

Background

If approved by voters, Proposition 58 would amend the California Constitution, making changes related to (1) the enactment and maintenance of a balanced state budget, (2) the establishment of specific reserve requirements, and (3) a restriction on future deficit-related borrowing. Specifically, Proposition 58 would require that the state adopt a balanced budget and provide for mid-year adjustments in the event that the budget falls out of balance. It would also require a reserve account and prohibit future borrowing to fund budget deficits.

Discussion

Proponents argue that Proposition 58 will prevent future overspending and require the state to restore fiscal discipline. Opponents argue that Proposition 58 allows for short-term borrowing and would not result in "anything very different from the stalemates we see today."

While Proposition 58 does not prevent short-term borrowing or borrowing between state funds, it will restrict general obligation and revenue bonds to cover deficits. It would also require the creation of a reserve to reduce the impacts of changes in revenues.

The Legislative Committee has reviewed Proposition 58 and recommends the Board's support.

Vision Alignment

Support of Proposition 58 would help the County to provide responsive, effective and collaborative government and work toward Goal #20-to ensure that government decisions are based on careful consideration of future impact, rather than temporary relief or immediate gain.

Fiscal Impact

According to the LAO, this measure could have a variety of fiscal effects, depending on future budget circumstances and future actions taken by Governors and Legislatures.