Senator Roth Delivers Major Victory for Riverside County’s Newest Cities

May 14, 2015

After over two years of intensive negotiations with Governor Jerry Brown, the Department of Finance and numerous stakeholders, Senator Richard D. Roth (D-Riverside) announced today the Governor has proposed funding for Riverside County’s four newest cities in his May budget revision.

Senator Roth said: “Restoring funding for Riverside County’s newest cities has been one of my top priorities since day one.  I am pleased the Governor has included this funding in his revised budget.  These cities, through no fault of their own, lost funding that every other new city historically received, and I thank the Governor for recognizing this critical issue of fairness and equity that threatened to force at least one city, Jurupa Valley, to disincorporate.”

The Governor’s May revision states:

“Newly Incorporated Cities — Four cities in Riverside County incorporated after

2004, making them ineligible to participate in the Vehicle License Fee (VLF)

Swap mechanism. The VLF Swap provides local agencies with property tax

revenue to replace VLF revenue they lost when the previous Administration

reduced the VLF rate from 2 percent to 0.65 percent. While the four cities

did receive an enhanced share of the 0.65 percent VLF rate, that share was

subsequently redirected in 2011 to fund public safety realignment. The loss of this

revenue has made it arduous for these contract cities to pay Riverside County for

public safety services — approximately $24 million is owed to Riverside County.

The May Revision proposes to absolve these cities of this one‑time debt by

reducing the reimbursements Riverside County must provide to the Department of

Forestry and Fire Protection (CalFIRE) for fire services. Riverside County will then

forgive the debt to the four cities and the General Fund will backfill CalFIRE for its

reduced reimbursements.”

In July 2011, the State shifted Vehicle License Fee (VLF) funds towards prison realignment. These funds were typically allocated to new cities in lieu of property tax revenue. For Jurupa Valley, this translated to a loss of nearly 30% of its general fund, monies it was counting on and rightfully expected to receive when its residents voted to incorporate.  Three other Riverside County cities - Eastvale, Menifee and Wildomar - also lost their share of this funding.

The Legislature must adopt the state budget by midnight, June 15. 

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