RDA Backfill Update - June 13, 2012
I’m pleased to announce that agreement has been reached with both the Department of Finance and the Legislature to hold CCCs harmless from shortages in property taxes related to the dissolution of RDAs in both the current (2011-12) and budget (2012-13) years for the liquid assets AND increment resources. Previously, the Administration had proposed language that would hold districts harmless from only the $201M in liquid assets that were proposed to be scooped from RDAs in 12-13, but they are currently amending the budget trailer bill language to ensure our budgets will be protected from any RDA-related shortfall.
Thanks to everyone who put pressure on the Administration and Legislature on this important issue – your voices were heard.
This budget will provide many challenges for CCCs, from cash flow concerns to the threat of more mid-year trigger cuts, but at least the state will not shift the risk of uncertain RDA property tax assumptions from the General Fund to the CCCs.
The final budget may bring more changes – the amount of deferrals being paid down if the ballot initiative passes will likely be less than was estimated at May Revision and the trigger cut figure may shift, as well – and I will do my best to keep you updated as the process unfolds. The current expectation is that both houses will vote for the budget package on Friday, though as the Governor has expressed concerns with some aspects of the Legislature’s plan (CalWORKS, primarily), it’s not yet clear he would sign it. Negotiations continue in the meantime.
I will provide a comprehensive budget overview when the agreement has been finalized.
Vice Chancellor for Fiscal Policy
Chancellor’s Office of the California Community Colleges