When the California Legislature approved the revision to the 2009-10 Budget, they borrowed nearly $2 billion of local property taxes to help address the state’s budget shortfall. At the same time, legislators and the Governor promised to allow local agencies to sell their eventual repayment from the state to investors to cover those losses and to pay the full cost of the sale, or securitization.
This action resulted in the Proposition 1A Securitization Program offered by the California Statewide Communities Development Authority (CSCDA), available to every California city, county, and special district that wishes to securitize.
The statutory provisions approved in July to implement this commitment were deficient, however, and they require significant clean-up language that is now contained in SB 67.
Passage of SB 67 by October 15 and a November bond sale are both necessary. There are three reasons for this necessity:
- No Delay in Payments to Local Agencies.
- State Saves $200 Million.
- Hundreds of Local Agencies Need to Act Soon.
Click here to read the full “15 Days to Keep a Committment” document.