For twenty years, California has been coping with the unintended consequences of changes in its fiscal policy that destroyed home rule in government. When the electorate voted in 1978 to reduce property taxes, it also shifted control of those revenues from local government to the State. I firmly believe that those voters did not consciously support this shift. But they approved it anyway because they were responding to what was then a genuine crisis in the impact of property taxes on individual homeowners up and down the state.
Now we are suffering the impacts of topsy-turvy fiscal policy on governance and quality of life in California. Local and county governments operate hand-to-mouth, each year waiting for the Governor and the Legislature to decide how much moeny they will get to provide vital services to their communities. They form special district after special district to pay for these services and facilities that used to be what taxpayers expected to get for their tax dollars. And they engage in cutthroat competition for sales tax revenues while their constituents complain, rightfully, that land use priorities are distorted and good jobs and affordable housing have disappeared in favor of minimum wage service jobs, endless auto malls and gridlocked traffic.
Everybody suffers in this crisis: communities, businesses, the environment, the economy and the performance and credibility of government. I believe there is a direct relationship between our fiscal imbalance and the public's increasing cynicism regarding the public sector over the last two decades. And I believe it is long past time to do something about it.
That is why ... a Blue Ribbon Commission [is] being formed with the help of [the] Metropolitan Forum Project that will tackle these issues in the coming year. I want the Commission to recommend solutions to me and my colleagues in the legislature so we can pursue appropriate remedies. ... Involvement will be rigorous ... I expect the Commission, and it subcommitties, to meet monthly for up to twelve months to formulate recommendations. Then you will work with me to broaden the constituency for fiscal reform in California as the legislature takes on the issue.
Very Truly Yours,
On September 15, 1998, the James Irvine Foundation convened its second annual Civic Entrepreneurs Summit in San Diego. "Civic Entrepreneurs act in the spirit of two great California traditions: individual entrepreneurship and civic action," says an Irvine Foundation report on the emerging public/private region-centered movement. Metro Investment Report is pleased to also present Assembly Speaker Antonio Villaraigosa's welcoming remarks to the delegates from 11 regional collaboratives who attended the summit.
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Speaker's Commission on State/Local Government Finance