Dear Governor Newsom,
On behalf of the Tulare County Board of Supervisors, I write to encourage you to veto Assembly Bill (AB) 1951. AB 1951 will reduce the sales tax revenue for every city and county in California resulting in the loss of services provided by our public safety agencies, anti-poverty programs, and public health services while simultaneously undermining voter approved ordinances that improve the quality of life for our communities.
Under the pretext of rebuilding the states manufacturing industry following the Covid-19 pandemic, AB 1951 would exempt municipalities of their fair share of local sales tax revenues for companies that buy equipment for industrial production over a five-year period of time. However, the state has not offered to compensate local counties for the expected revenue loss during this five-year period. The loss of revenue is estimated to cost California counties close to $2 billion. These cuts will directly affect Tulare County's critical public safety and social service providers that are funded by the 1991 Realignment and Proposition 172 voter supported initiatives.
AB 1951 is expected to reduce 1991 Realignment revenues by $275 million across all California counties. These funds currently support behavioral public health programs, social services, and public hospital safety net systems. Due to funding restrictions which apply to county behavioral health funding streams, the loss of 1991 Realignment would result in a catastrophic system failure for California's behavioral health safety net. In Tulare County, the five-year reduction in sales tax will result in an estimated $4.6 million reduction in health and social service programs. Local health departments also rely on 1991 Realignment to support critical functions such as public health laboratories, infectious and chronic disease research, health equity, maternal health, adolescent health, and environmental health programs. AB 1951 would further reduce funding that supports these programs and hinder recent investments at a time when Tulare County continues to respond to the COVID-19 pandemic, the monkeypox outbreak, and other public health threats.
AB 1951 would also cut public safety programs associated with Proposition 172 that fund county and city fire protection services, law enforcement personnel, and legal support services, by $289 million across all California counties. In Tulare County, expected revenue loss from AB 1951 would result in another $4 million reduction in the county budget that will affect services provided by our first responders.
AB 1951 not only cuts Tulare County's tax revenues, but also weakens local voters and citizen initiatives. Voters in Tulare County, and across the state, voted for services that improve their quality of life. Voter approved taxes that currently support public safety, road maintenance, and youth services would all be affected by AB 1951, undermining the democratic founding principles of our state and nation. For these reasons and more, I write to encourage you to veto AB 1951 (Grayson).
Eddie Valero, Chair
Tulare County Board of Supervisors