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Strategies & Market Trends : Galapagos Islands -- Ignore unavailable to you. Want to Upgrade?

To: Libbyt who wrote (42690)	6/23/2003 4:57:49 PM
From: MulhollandDrive	Read Replies (2) \| Respond to of 57110

my pleasure, libby.....more interesting and bullish news<g>.... dailynews.com Vehicle fee set to triple By Rick Orlov Staff Writer Gov. Gray Davis' administration formally declared Friday that California has run out of money, triggering a tripling of vehicle license fees for motorists without legislative approval. The tax will cost drivers an average of $158 more a year and add $4 billion a year to the state treasury to help cover the $38 billion shortfall. Registrations due in October will be the first required to pay the higher fees. Republicans denounced the governor's strategy and announced plans to challenge the increase in the courts as well as at the ballot box, with Sen. Tom McClintock, R-Thousand Oaks, filing requests to circulate two separate petitions for ballot measures. "The state is broke," state Finance Director Steve Peace said after issuing a technically worded, four-paragraph memo instructing state officials to take the steps necessary to raise the tax. "For the first time, we have none of our own money. As of today, we are operating totally on borrowed cash. In addition, we have no more borrowing capacity left." Davis did not comment on the fee increase, which he had called for in his May budget revision to deal with the shortfall. "This is not something the governor or anyone else wanted to see, but the economic problems are so severe there is no other option," Davis spokeswoman Hilary McLean said. Assemblyman John Campbell, R-Irvine, the ranking Republican on the Budget Committee, said he plans to join tax groups such as the Howard Jarvis Taxpayers Association to challenge the action. "This tax increase is not right, it is not fair and it is not legal," Campbell said. "I will work to ensure that this tax is overturned in court and that car owners get their full refunds." Assemblyman Tony Strickland, R-Westlake Village, chairman of the Assembly Republican caucus, joined the Jarvis group's challenge as he declared the increase "illegal" without a vote of the Legislature. The vehicle license fee was reduced in 1998 and again in 2000 -- by a total of more than 67 percent -- at a time when the state had a large surplus. As part of that action, however, the Legislature included what was known as a trigger to reinstate it to the previous levels if the state ever ran out of money. Peace invoked that clause Friday. Jon Coupal, president of the Howard Jarvis Taxpayers Association, said the challenge will be based on the failure to require the Legislature to approve reinstating the tax with a two-thirds vote. "We don't think this can be done by the governor delegating it to one of his people," Coupal said. "The language is ambiguous, but we think the Legislature has to vote on this." McClintock said he believes it will take too long for the courts to act and that he is going to go to the voters to change the law. He filed two requests for ballot initiatives with the Attorney General's Office. One would change the law to set vehicle registration fees at $1 and the second would be a constitutional amendment banning the fee outright. "I'm quite certain we can qualify both of these for the ballot," McClintock said. "We've already had 11,000 people sign up at my Web site, tommcclintock.com, and pledged to get the signatures. "Quite simply, this is money the state doesn't need. The state gets more than enough tax money from the people of California. Our problem is spending. We are spending too much money." Los Angeles Mayor James Hahn and Police Chief William Bratton welcomed the tax increase, saying the money would go to local government. "I appreciate that by pulling the VLF trigger, the state is maintaining local governments' ability to pay for essential police and fire services," Hahn said. Bratton said he had been encouraging state officials to raise the fee. "Without this money, we won't be able to hire officers," Bratton said. "This is critical to run this department." The Associated Press contributed to this report. Rick Orlov, 213-978-0390 rick.orlov@dailynews.com