State budget stings city State budget stings city (July 30, 2004)

City faces take-away of $3 million over next two years

By Jon Wiener

Girlie-men or not, the state legislature finally agreed on a budget Monday night, nearly a month late. The budget will cost the city of Mountain View $3 million in lost property tax revenue over the next two years.

California cities lost funding in the budget process, but things could have gone much worse if not for a pending state ballot initiative that could prohibit the state take-away and effectively send the budget back to the drawing board.

Earlier this year, Mountain View city council members and other civic leaders from throughout the state collected enough signatures to qualify state Proposition 65 on the November ballot, a constitutional amendment that would forever separate state and local revenues. Gov. Arnold Schwarzenegger opposed the measure but offered to support a compromise, in which a similar amendment would take effect after two years.

"We're hoping the trade-off will be sufficient to make this a worthwhile sacrifice," said City Manager Kevin Duggan. "There are a lot of things we could do with $3 million to benefit the community."

Duggan said that if the protections do become final, the city could make up for the shortfall using contingency funds. However, he added, using those funds to replace lost revenue prevents them from being used on capital improvement projects such as the Stevens Creek Trail extension.

Details of the compromise have not been worked out, but it will likely take the form of another ballot measure. If the California League of Cities and other organizations are not satisfied with its protections, they may fight it and the take-away, by campaigning for Prop. 65, which remains on the ballot.

"That's the only bargaining chip we have at this point," said Duggan. "They don't need our approval to adopt the state budget."

E-mail Jon Wiener at jwiener@mv-voice.com

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