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CITY COUNCIL AGENDA ITEM 13

Meeting Date: February 26, 2002

Subject/Title: Approve a Resolution supporting State Assembly Bill 81 (Midgen) with the Los Angeles Amendment.

Submitted by: Karen Diaz

Approved by: John Stevenson, City Manager


RECOMMENDATION 
Approve a Resolution supporting State Assembly Bill 81 (Midgen) with the Los Angeles County Amendment to Ensure Equitable Distribution of Property Tax Revenues derived from power plants.

PREVIOUS ACTION
None


BACKGROUND
There is a need for siting and constructing new electric generation facilities in the State of California in order to reduce reliance on out-of-state electrical power and to stabilize electricity rates. The cooperation of local jurisdictions is important to the successful siting and construction of these new power plants. The new property tax revenues generated by these facilities are significant, positive incentives for local support and provide needed funding to offset the extra burden on local services and to mitigate negative environmental impacts.

The City of Pittsburg considered these factors in its support of two power plants within its city limits that will generate approximately $7 million of local property tax revenues and augment the state power grid by more than 1,3000 megawatts of capacity. Incentives to site new power plants should be equitable and fair and not be at the expense of the long time hosts of power plants that have served California for many years.

In 1998, Contra Costa County was receiving approximately $2.7 million of annual property tax revenue for the two power plants in its unincorporated territory, while today it is only receiving about $735,000 a year, primarily due to the shift from the unitary method of distribution under the local County Assessor.

On November 28, 2001, the State Board of Equalization amended its Rule 905, re-establishing state assessment of power plants effective fiscal year 2003-04. It is not fair that the County should suffer a permanent revenue loss due to a temporary transfer of assessment authority, nor is it fair that the City of Pittsburg does not receive its expected power plant property tax revenues.

Assembly Bill 81 (Midgen) with the Los Angeles Amendment would be equitable and fair both to jurisdictions which have supported new power plants and to those which have hosted power plants for many years by establishing the situs method distribution for power plants never assessed by the State Board of Equalization and re-establishing the unitary method for those which had previously been under the State Board of Equalization’s authority.

FISCAL IMPACT
None


RESOLUTION NO. 

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BRENTWOOD SUPPORTING STATE ASSEMBLY BILL 81 (MIDGEN) WITH THE LOS ANGELES COUNTY AMENDMENT TO ENSURE EQUITABLE DISTRIBUTION OF PROPERTY TAX REVENUES DERIVED FROM POWER PLANTS.

WHEREAS, there is a need for siting and constructing new electric generation facilities in the State of California in order to reduce reliance on out-of-state electrical power and to stabilize electricity rates; and

WHEREAS, the cooperation of local jurisdictions is important to the successful siting and construction of these new power plants; and

WHEREAS, the new property tax revenues generated by these facilities are significant, positive incentives for local support and provide needed funding to offset the extra burden on local services and to mitigate negative environmental impacts; and

WHEREAS, the city of Pittsburg considered these factors in its support of two power plants within its city limits that will generate approximately $7 million of local property tax revenues and augment the state power grid by more than 1,3000 megawatts of capacity; and 

WHEREAS, incentives to site new power plants should be equitable and fair and not be at the expense of the long time hosts of power plants that have served California for many years; and

WHEREAS, in 1998, Contra Costa County was receiving approximately $2.7 million of annual property tax revenue for the two power plants in its unincorporated territory, while today it is only receiving about $735,000 a year, primarily due to the shift from the unitary method of distribution under the local County Assessor; and

WHEREAS, on November 28, 2001, the State Board of Equalization amended its Rule 905, re-establishing state assessment of power plants effective fiscal year 2003-04; and

WHEREAS, it is not fair that the County should suffer a permanent revenue loss due to a temporary transfer of assessment authority, nor is it fair that the City of Pittsburg does not receive its expected power plant property tax revenues; and

WHEREAS, Assembly Bill 81 (Midgen) with the Los Angeles Amendment would be equitable and fair both to jurisdictions which have supported new power plants and to those which have hosted power plants for many years by establishing the situs method distribution for power plants never assessed by the State Board of Equalization and re-establishing the unitary method for those which had previously been under the State Board of Equalization’s authority.

NOW, THEREFORE BE IT RESOLVED that the City Council of the City of Brentwood does hereby support the passage of AB 81 with the Los Angeles Amendment and urges its representatives in the State Assembly and Senate and the Governor to enact AB 81 with the Los Angeles Amendment as soon as possible.

PASSED, APPROVED AND ADOPTED by the City Council of the City of Brentwood at a regular meeting held February 26, 2002 by the following vote:

AYES: 
NOES: None
ABSENT: 

_____________________________
Michael A. McPoland, Sr.
Mayor

ATTEST:

__________________________________
Karen Diaz, CMC
City Clerk

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