State Codes and Statutes

Statutes > California > Rtc > 98-98.1

REVENUE AND TAXATION CODE
SECTION 98-98.1



98.  (a) In each county, other than the County of Ventura, having
within its boundaries a qualifying city, the computations made
pursuant to Section 96.1 or its predecessor section, for the 1989-90
fiscal year and each fiscal year thereafter, shall be modified as
follows:
   With respect to tax rate areas within the boundaries of a
qualifying city, there shall be excluded from the aggregate amount of
"property tax revenue allocated pursuant to this chapter to local
agencies, other than for a qualifying city, in the prior fiscal year,"
an amount equal to the sum of the amounts calculated pursuant to the
TEA formula.
   (b) (1) Except as otherwise provided in this section, each
qualifying city shall, for the 1989-90 fiscal year and each fiscal
year thereafter, be allocated by the auditor an amount determined
pursuant to the TEA formula.
   (2) For each qualifying city, the auditor shall, for the 1989-90
fiscal year and each fiscal year thereafter, allocate the amount
determined pursuant to the TEA formula to all tax rate areas within
that city in proportion to each tax rate area's share of the total
assessed value in the city for the applicable fiscal year, and the
amount so determined shall be subtracted from the county's
proportionate share of property tax revenue for that fiscal year
within those tax rate areas.
   (3) After making the allocations pursuant to paragraphs (1) and
(2), but before making the calculations pursuant to Section 96.5 or
its predecessor section, the auditor shall, for all tax rate areas in
the qualifying city, calculate the proportionate share of property
tax revenue allocated pursuant to this section and Section 96.1, or
their predecessor sections, in the 1989-90 fiscal year and each
fiscal year thereafter to each jurisdiction in the tax rate area.
   (4) In lieu of making the allocations of annual tax increment
pursuant to subdivision (e) of Section 96.5 or its predecessor
section, the auditor shall, for the 1989-90 fiscal year and each
fiscal year thereafter, allocate the amount of property tax revenue
determined pursuant to subdivision (d) of Section 96.5 or its
predecessor section to jurisdictions in the tax rate area using the
proportionate shares derived pursuant to paragraph (3).
   (5) For purposes of the calculations made pursuant to Section 96.1
or its predecessor section, in the 1990-91 fiscal year and each
fiscal year thereafter, the amounts that would have been allocated to
qualifying cities pursuant to this subdivision shall be deemed to be
the "amount of property tax revenue allocated in the prior fiscal
year."
   (c) "TEA formula" means the Tax Equity Allocation formula, and
shall be calculated by the auditor for each qualifying city as
follows:
   (1) For the 1988-89 fiscal year and each fiscal year thereafter,
the auditor shall determine the total amount of property tax revenue
to be allocated to all jurisdictions in all tax rate areas within the
qualifying city, before the allocation and payment of funds in that
fiscal year to a community redevelopment agency within the qualifying
city, as provided in subdivision (b) of Section 33670 of the Health
and Safety Code.
   (2) The auditor shall determine the total amount of funds
allocated in each fiscal year to a community redevelopment agency in
accordance with subdivision (b) of Section 33670 of the Health and
Safety Code.
   (3) The auditor shall determine the total amount of funds paid in
each fiscal year by a community redevelopment agency within the city
to jurisdictions other than the city pursuant to subdivision (b) of
Section 33401 and Section 33676 of the Health and Safety Code, and
the cost to the redevelopment agency of any land or facilities
transferred and any amounts paid to jurisdictions other than the city
to assist in the construction or reconstruction of facilities
pursuant to an agreement entered into under Section 33401 or 33445.5
of the Health and Safety Code.
   (4) The auditor shall subtract the amount determined in paragraph
(3) from the amount determined in paragraph (2).
   (5) The auditor shall subtract the amount determined in paragraph
(4) from the amount determined in paragraph (1).
   (6) The amount computed in paragraph (5) shall be multiplied by
the following percentages in order to determine the TEA formula
amount to be distributed to the qualifying city in each fiscal year:
   (A) For the first fiscal year in which the qualifying city
receives a distribution pursuant to this section, 1 percent of the
amount determined in paragraph (5).
   (B) For the second fiscal year in which the qualifying city
receives a distribution pursuant to this section, 2 percent of the
amount determined in paragraph (5).
   (C) For the third fiscal year in which the qualifying city
receives a distribution pursuant to this section, 3 percent of the
amount determined in paragraph (5).
   (D) For the fourth fiscal year in which the qualifying city
receives a distribution pursuant to this section, 4 percent of the
amount determined in paragraph (5).
   (E) For the fifth fiscal year in which the qualifying city
receives a distribution pursuant to this section, 5 percent of the
amount determined in paragraph (5).
   (F) For the sixth fiscal year in which the qualifying city
receives a distribution pursuant to this section, 6 percent of the
amount determined in paragraph (5).
   (G) For the seventh fiscal year and each fiscal year thereafter in
which the city receives a distribution pursuant to this section, 7
percent of the amount determined in paragraph (5).
   (d) "Qualifying city" means any city, except a qualifying city as
defined in Section 98.1, that incorporated prior to June 5, 1987, and
had an amount of property tax revenue allocated to it pursuant to
subdivision (a) of Section 96.1 or its predecessor section in the
1988-89 fiscal year that is less than 7 percent of the amount of
property tax revenue computed as follows:
   (1) The auditor shall determine the total amount of property tax
revenue allocated to the city in the 1988-89 fiscal year.
   (2) The auditor shall subtract the amount in the 1988-89 fiscal
year determined in paragraph (3) of subdivision (c) from the amount
determined in paragraph (2) of subdivision (c).
   (3) The auditor shall subtract the amount determined in paragraph
(2) from the amount of property tax revenue determined in paragraph
(1) of subdivision (c).
   (4) The auditor shall divide the amount of property tax revenue
determined in paragraph (1) of this subdivision by the amount of
property tax revenue determined in paragraph (3) of this subdivision.
   (5) If the quotient determined in paragraph (4) of this
subdivision is less than 0.07, the city is a qualifying city. If the
quotient determined in that paragraph is equal to or greater than
0.07, the city is not a qualifying city.
   (e) The auditor may assess each qualifying city its proportional
share of the actual costs of making the calculations required by this
section, and may deduct that assessment from the amount allocated
pursuant to subdivision (b). For purposes of this subdivision, a
qualifying city's proportional share of the auditor's actual costs
shall not exceed the proportion it receives of the total amounts
excluded in the county pursuant to subdivision (a).
   (f) Notwithstanding subdivision (b), in any fiscal year in which a
qualifying city is to receive a distribution pursuant to this
section, the auditor shall reduce the actual amount distributed to
the qualifying city by the sum of the following:
   (1) The amount of property tax revenue that was exchanged between
the county and the qualifying city as a result of negotiation
pursuant to Section 99.03.
   (2) (A) The amount of revenue not collected by the qualifying city
in the first fiscal year following the city's reduction after
January 1, 1988, of the tax rate or tax base of any locally imposed
tax, except any tax that was imposed after January 1, 1988. In the
case of a tax that existed before January 1, 1988, this clause shall
apply only with respect to an amount attributable to a reduction of
the rate or base to a level lower than the rate or base applicable on
January 1, 1988. The amount so computed by the auditor shall
constitute a reduction in the amount of property tax revenue
distributed to the qualifying city pursuant to this section in each
succeeding fiscal year. That amount shall be aggregated with any
additional amount computed pursuant to this clause as the result of
the city's reduction in any subsequent year of the tax rate or tax
base of the same or any other locally imposed general or special tax.
   (B) No reduction may be made pursuant to subparagraph (A) in the
case in which a local tax is reduced or eliminated as a result of
either a court decision or the approval or rejection of a ballot
measure by the voters.
   (3) The amount of property tax revenue received pursuant to this
chapter in excess of the amount allocated for the 1986-87 fiscal year
by all special districts that are governed by the city council of
the qualifying city or whose governing body is the same as the city
council of the qualifying city with respect to all tax rate areas
within the boundaries of the qualifying city.
   Notwithstanding this paragraph:
   (A) Commencing with the 1994-95 fiscal year, the auditor shall not
reduce the amount distributed to a qualifying city under this
section by reason of that city becoming the successor agency to a
special district, that is dissolved, merged with that city, or
becomes a subsidiary district of that city, on or after July 1, 1994.
   (B) Commencing with the 1997-98 fiscal year, the auditor shall not
reduce the amount distributed to a qualifying city under this
section by reason of that city withdrawing from a county free library
system pursuant to Section 19116 of the Education Code.
   (4) Any amount of property tax revenues that has been exchanged
pursuant to Section 56842 of the Government Code between the City of
Rancho Mirage and a community services district, the formation of
which was initiated on or after March 6, 1997, pursuant to Chapter 4
(commencing with Section 56800) of Part 3 of Division 3 of Title 5 of
the Government Code.
   (g) Notwithstanding any other provision of this section, in no
event may the auditor reduce the amount of ad valorem property tax
revenue otherwise allocated to a qualifying city pursuant to this
section on the basis of any additional ad valorem property tax
revenues received by that city pursuant to a services for revenue
agreement. For purposes of this subdivision, a "services for revenue
agreement" means any agreement between a qualifying city and the
county in which it is located, entered into by joint resolution of
that city and that county, under which additional service
responsibilities are exchanged in consideration for additional
property tax revenues.
   (h) In any fiscal year in which a qualifying city is to receive a
distribution pursuant to this section, the auditor shall increase the
actual amount distributed to the qualifying city by the amount of
property tax revenue allocated to the qualifying city pursuant to
Section 19116 of the Education Code.
   (i) If the auditor determines that the amount to be distributed to
a qualifying city pursuant to subdivision (b), as modified by
subdivisions (e), (f), and (g) would result in a qualifying city
having proceeds of taxes in excess of its appropriation limit, the
auditor shall reduce the amount, on a dollar-for-dollar basis, by the
amount that exceeds the city's appropriations limit.
   (j) The amount not distributed to the tax rate areas of a
qualifying city as a result of this section shall be distributed by
the auditor to the county.
   (k) Notwithstanding any other provision of this section, no
qualifying city shall be distributed an amount pursuant to this
section that is less than the amount the city would have been
allocated without the application of the TEA formula.
   (l) Notwithstanding any other provision of this section, the
auditor shall not distribute any amount determined pursuant to this
section to any qualifying city that has in the prior fiscal year used
any revenues or issued bonds for the construction, acquisition, or
development, of any facility which is defined in Section 103(b)(4),
103(b)(5), or 103(b)(6) of the Internal Revenue Code of 1954 prior to
the enactment of the Tax Reform Act of 1986 (P.L. 99-514) and is no
longer eligible for tax-exempt financing.
   (m) (1) The amendments made to this section, and the repeal of
Section 98.04, by the act that added this subdivision shall apply for
the 2006-07 fiscal year and each fiscal year thereafter.
   (2) For the 2006-07 fiscal year and for each fiscal year
thereafter, all of the following apply:
   (A) The auditor of the County of Santa Clara shall do both of the
following:
   (i) Reduce the total amount of ad valorem property tax revenue
otherwise required to be allocated to qualifying cities in that
county by the ERAF reimbursement amount. This reduction for each
qualifying city in the county for each fiscal year shall be the
percentage share, of the total reduction required by this clause for
all qualifying cities in the county for the 2006-07 fiscal year, that
is equal to the proportion that the total amount of additional ad
valorem property tax revenue that is required to be allocated to the
qualifying city as a result of the act that added this subdivision
bears to the total amount of additional ad valorem property tax
revenue that is required to be allocated to all qualifying cities in
the county as a result of the act that added this subdivision.
   (ii) Increase the total amount of ad valorem property tax revenue
otherwise required to be allocated to the county Educational Revenue
Augmentation Fund by the ERAF reimbursement amount.
   (B) For purposes of this subdivision, "ERAF reimbursement amount"
means an amount equal to the difference between the following two
amounts:
   (i) The portion of the annual tax increment that would have been
allocated from the county to the county Educational Revenue
Augmentation Fund for the applicable fiscal year if the act that
added this subdivision had not been enacted.
   (ii) The portion of the annual tax increment that is allocated
from the county to the county Educational Revenue Augmentation Fund
for the applicable fiscal year.



98.01.  (a) An independent qualifying city shall receive a
distribution of the following percentages of the TEA formula, as
computed in subdivision (c) of Section 98, if the amount of that
distribution, less the applicable reductions provided for in
subdivisions (e), (f), and (g) of Section 98, would be greater than
the amount the city would have been allocated without the application
of the TEA formula:
   (1) Thirty-three and one-third percent of the amount determined in
subparagraph (G) of paragraph (6) of subdivision (c) of Section 98,
less any applicable reductions provided for in subdivisions (e), (f),
and (g) of Section 98, for the first fiscal year in which the
independent qualifying city receives an allocation pursuant to this
section.
   (2) Sixty-six and two-thirds percent of the amount determined in
subparagraph (G) of paragraph (6) of subdivision (c) of Section 98,
less any applicable reductions provided for in subdivisions (e), (f),
and (g) of Section 98, for the second fiscal year in which the
independent qualifying city receives an allocation pursuant to this
section.
   (3) One hundred percent of the amount determined in subparagraph
(G) of paragraph (6) of subdivision (c) of Section 98, less any
applicable reductions provided for in subdivisions (e), (f), and (g)
of Section 98, for the third fiscal year in which the independent
qualifying city receives an allocation pursuant to this section.
   The amount not distributed as a result of this subdivision to the
tax rate areas in each independent qualifying city, shall be
allocated by the auditor to the county. The auditor may assess each
independent qualifying city its proportional share of the actual
costs of making the calculations required by this subdivision, and
may deduct that assessment from the amount allocated pursuant to this
subdivision. For purposes of this subdivision, an independent
qualifying city's proportional share of the auditor's actual costs
shall not exceed the proportion it receives of the total amounts
excluded in the county pursuant to subdivision (a) of Section 98.
   (b) "Independent qualifying city" means a qualifying city, as
defined in Section 98, in the County of Los Angeles which met the
following criteria on January 1, 1988:
   (1) Was not served by a special district which received a portion
of the 1 percent property tax revenue, and provided any of the
following services to the qualified city:
   (A) Emergency medical services.
   (B) Fire prevention services.
   (C) Fire suppression.
   (D) Libraries.
   (E) Parks.
   (F) Recreation services.
   (G) Street lighting.
   (2) Did not have redevelopment project areas which receive
property tax revenues.
   (3) The county general fund received greater than 65 percent of
the 1 percent property tax revenues collected from tax rate areas
within the qualifying city's boundaries.


98.02.  (a) In the County of Ventura, the computations made pursuant
to Section 96.1 or its predecessor section, for the 1989-90 fiscal
year and each fiscal year thereafter, shall be modified as follows:
   With respect to tax rate areas, except excluded tax rate areas,
within the boundaries of a qualifying city, there shall be excluded
from the aggregate amount of "property tax revenue allocated pursuant
to this chapter to local agencies, other than for a qualifying city,
in the prior fiscal year," an amount equal to the sum of the amounts
calculated pursuant to the TEA formula.
   (b) (1) Each qualifying city shall, for the 1989-90 fiscal year
and each fiscal year thereafter, be allocated by the auditor an
amount determined pursuant to the TEA formula.
   (2) For each qualifying city, the auditor shall, for the 1989-90
fiscal year and each fiscal year thereafter, distribute the amount
determined pursuant to the TEA formula to all tax rate areas, except
excluded tax rate areas, within that city in proportion to each tax
rate area's share of the total assessed value in the city for the
applicable fiscal year, and the amount so determined shall be
subtracted from the county's proportionate share of the property tax
revenue for that fiscal year within those tax rate areas.
   (3) After making the allocations pursuant to paragraphs (1) and
(2), but before making the calculations pursuant to Section 96.5 or
its predecessor section, the auditor shall, for all tax rate areas,
except excluded tax rate areas, in the qualifying city, calculate the
proportionate share of property tax revenue allocated pursuant to
this section and Section 96.1, or their predecessor sections, in the
1989-90 fiscal year and each fiscal year thereafter to each
jurisdiction in the tax rate area.
   (4) In lieu of making the allocations of annual tax increment
pursuant to subdivision (e) of Section 96.5 or its predecessor
section, the auditor shall for the 1989-90 fiscal year and each
fiscal year thereafter, allocate the amount of property tax revenue
determined pursuant to subdivision (d) of Section 98 to jurisdictions
in the tax rate area, except an excluded tax rate area, using the
proportionate shares derived pursuant to paragraph (3).
   (5) For purposes of the calculations made pursuant to Section 96.1
or its predecessor section, in the 1990-91 fiscal year and each
fiscal year thereafter, the amounts that would have been allocated to
all tax rate areas, except excluded tax rate areas, of qualifying
cities pursuant to this subdivision shall be deemed to be the "amount
of property tax revenue allocated to those tax rate areas in the
prior fiscal year."
   (c) "TEA formula" means the Tax Equity Allocation formula, and
shall be calculated by the auditor for each qualifying city as
follows:
   (1) For the 1988-89 fiscal year and each fiscal year thereafter,
the auditor shall determine the total amount of property tax revenue
to be allocated to all jurisdictions in all tax rate areas, except
excluded tax rate areas, within the qualifying city, before the
allocation and payment of funds in that fiscal year to a community
redevelopment agency within the qualifying city, as provided in
subdivision (b) of Section 33670 of the Health and Safety Code.
   (2) The auditor shall determine the amount of funds allocated in
each fiscal year to those tax rate areas, except excluded tax rate
areas, within a community redevelopment agency in accordance with
subdivision (b) of Section 33670 of the Health and Safety Code.
   (3) (A) The auditor shall determine the total amount of funds paid
in each fiscal year by a community redevelopment agency within the
city to jurisdictions other than the city pursuant to subdivision (b)
of Section 33401 and Section 33676 of the Health and Safety Code,
and the cost to the redevelopment agency of any land or facilities
transferred and any amounts paid to jurisdictions other than the city
to assist in the construction or reconstruction of facilities
pursuant to an agreement entered into under Section 33401 or 33445.5
of the Health and Safety Code.
   (B) Of the total amount determined in subparagraph (A), the
auditor shall compute a proportionate amount to be attributed to all
tax rate areas, except excluded tax rate areas, within the community
redevelopment agency. That proportionate amount shall be equal to
that proportion which the amount determined in paragraph (2) in each
fiscal year bears to the total amount of funds allocated in each
fiscal year to a community redevelopment agency in accordance with
subdivision (b) of Section 33670 of the Health and Safety Code.
   (4) The auditor shall subtract the amount determined in
subparagraph (B) of paragraph (3) from the amount determined in
paragraph (2).
   (5) The auditor shall subtract the amount determined in paragraph
(4) from the amount determined in paragraph (1).
   (6) The amount computed in paragraph (5) shall be multiplied by
the following percentages in order to determine the TEA formula
amount to be distributed to the qualifying city in each fiscal year:
   (A) For the first fiscal year in which the qualifying city
receives a distribution pursuant to this section, 1 percent of the
amount determined in paragraph (5).
   (B) For the second fiscal year in which the qualifying city
receives a distribution pursuant to this section, 2 percent of the
amount determined in paragraph (5).
   (C) For the third fiscal year in which the qualifying city
receives a distribution pursuant to this section, 3 percent of the
amount determined in paragraph (5).
   (D) For the fourth fiscal year and each fiscal year thereafter in
which the qualifying city receives a distribution pursuant to this
section, 4 percent of the amount determined in paragraph (5).
   (d) For purposes of this section, "excluded tax rate area" means
either of the following:
   (1) Any tax rate area included in territory annexed by the
qualifying city and allocated a prescribed percentage of property tax
revenue pursuant to an existing agreement between the qualifying
city and the county.
   (2) Any tax rate area described in paragraph (1) that was detached
from the county library district and that is also allocated an
additional prescribed percentage of property tax revenue pursuant to
an existing agreement between the qualifying city and the county.
   (e) (1) All existing agreements between the qualifying city and
the county covering the allocation of property tax revenues to tax
rate areas described in subdivision (d) shall remain in force.
   (2) All existing agreements between the qualifying city and the
county covering the allocation of property tax revenues to tax rate
areas that were detached from the county library district but are not
included in territory that was annexed by the qualifying city shall
remain in force.
   (3) All allocations to those tax rate areas described in
subdivision (d), including allocations of annual tax increments, made
pursuant to the existing agreements between the qualifying city and
the county shall be governed by subdivision (a) of Section 96.1 and
Section 96.5.
   (4) All allocations to those tax rate areas described in paragraph
(2), including allocations of annual tax increments, made pursuant
to the existing agreements between the qualifying city and the county
shall be governed by subdivision (a) of Section 96.1 and Section
96.5. However, the tax rate areas referred to in this paragraph shall
also be distributed an amount of property tax revenue determined
pursuant to the TEA formula that is over and above the amount
allocated as provided in the preceding sentence.
   (f) "Qualifying city" means any city that incorporated prior to
June 5, 1987, and had an amount of property tax revenue allocated to
it pursuant to subdivision (a) of Section 96.1 or its predecessor
section in the 1988-89 fiscal year that is less than 4 percent of the
amount of property tax revenue computed as follows:
   (1) The auditor shall determine the total amount of property tax
revenue allocated to all tax rate areas, except excluded tax rate
areas, in the city in the 1988-89 fiscal year.
   (2) The auditor shall subtract the amount in the 1988-89 fiscal
year determined in paragraph (3) of subdivision (c) from the amount
determined in paragraph (2) of subdivision (c).
   (3) The auditor shall subtract the amount determined in paragraph
(2) from the amount of property tax revenue in paragraph (1) of
subdivision (c).
   (4) The auditor shall divide the amount of property tax revenue
determined in paragraph (1) of this subdivision by the amount of
property tax revenue determined in paragraph (3) of this subdivision.
   (5) If the quotient determined in paragraph (4) of this
subdivision is less than 0.04, the city is a qualifying city. If the
quotient determined in that paragraph is equal to or greater than
0.04, the city is not a qualifying city.
   (g) The auditor may assess each qualifying city its proportional
share of the actual costs of making the calculations required by this
section, and may deduct that assessment from the amount allocated
pursuant to subdivision (b). For purposes of this subdivision, a
qualifying city's proportional share of the auditor's actual costs
shall not exceed the proportion it receives of the total amounts
excluded in the county pursuant to subdivision (a).
   (h) (1) Notwithstanding subdivision (b), except as otherwise
provided in paragraph (2), in any fiscal year in which a qualifying
city receives a distribution pursuant to this section, the auditor
shall reduce the actual amount distributed to the qualifying city by
the amount of revenue not collected by the qualifying city in the
first fiscal year following the city's reduction after January 1,
1988, of the tax rate or tax base of any locally imposed general or
special tax. The amount so computed by the auditor shall constitute a
reduction in the amount of property tax revenue distributed to the
qualifying city pursuant to this section in each succeeding fiscal
year. That amount shall be aggregated with any additional amount
computed pursuant to this paragraph as the result of the city's
reduction in any subsequent year of the tax rate or tax base of the
same or any other locally imposed general or special tax.
   (2) No reduction shall be made pursuant to paragraph (1) in the
case in which a local tax is reduced or eliminated as a result of
either a court decision or the approval or rejection of a ballot
measure by the voters.
   (i) If the auditor determines that the amount to be distributed to
a qualifying city pursuant to subdivision (b), as modified by
subdivisions (g) and (h), would result in a qualifying city having
proceeds of taxes in excess of its appropriation limit, the auditor
shall reduce the amount, on a dollar-for-dollar basis, by the amount
that exceeds the city's appropriations limit.
   (j) Notwithstanding any other provision of this section, no
qualifying city shall be distributed an amount pursuant to this
section that is less than the amount the city would have been
allocated without the application of the TEA formula.
   (k) (1) Notwithstanding any other provision of this section,
commencing with the 1994-95 fiscal year, the auditor shall not reduce
the amount distributed to a qualifying city under this section by
reason of that city becoming the successor agency to a special
district that is dissolved, merged with that city, or becomes a
subsidiary district of that city, on or after July 1, 1994.
   (2) Notwithstanding any other provision of this section, in no
event may the auditor reduce the amount of ad valorem property tax
revenue otherwise allocated to a qualifying city pursuant to this
section on the basis of any additional ad valorem property tax
revenues received by that city pursuant to a services for revenue
agreement. For purposes of this subdivision, a "services for revenue
agreement" means any agreement between a qualifying city and the
county in which it is located, entered into by joint resolution of
that city and that county, under which additional service
responsibilities are exchanged in consideration for additional
property tax revenues.
   (l) The amount not distributed as a result of this section to the
tax rate areas, except excluded tax rate areas, in each qualifying
city shall be allocated by the auditor to the county.




98.03.  For purposes of Section 98, the definition of qualifying
city contained in subdivision (d) of that section shall not include
the City of Foster City.


98.1.  (a) In the County of Orange, the computations made pursuant
to Section 96.1 or its predecessor section, for the 1984-85 fiscal
year only, shall be modified as follows:
   (1) With respect to tax rate areas within the boundaries of a
qualifying city, there shall be excluded from the aggregate amount of
"property tax revenue allocated pursuant to this chapter to local
agencies, other than for a qualifying city, in the prior fiscal year,"
an amount equal to the sum of amounts calculated pursuant to the TEA
formula, as defined in subdivision (c).
   (2) The amount excluded pursuant to paragraph (1) shall be
subtracted from the allocations of all local agencies other than a
qualifying city with tax rate areas within the boundaries of a
qualifying city in proportion to each such local agency's share of
the total 1983-84 property tax revenues, as defined in subdivision
(c) of Section 95, allocated to all those tax rate areas.
   (b) (1) Each qualifying city, as defined in subdivision (d), shall
for the 1984-85 fiscal year only, be allocated by the auditor an
amount determined pursuant to the TEA formula, as defined in
subdivision (c).
   (2) For each qualifying city, the auditor shall distribute the
amount determined pursuant to the TEA formula to all tax rate areas
within the city in proportion to each tax rate area's share of the
total 1983-84 assessed value in the city.
   (3) After making the allocations, pursuant to paragraphs (1) and
(2) but before making the calculations pursuant to Section 96.5, the
auditor shall, for all tax rate areas in the qualifying city,
calculate the proportionate share of property tax revenue allocated
pursuant to this section and Section 96.1 in the 1984-85 fiscal year
to each jurisdiction in the tax rate area.
   (4) In lieu of making the allocations of annual tax increment
pursuant to subdivision (e) of Section 96.5 or its predecessor
section, the auditor shall for the 1984-85 fiscal year only, allocate
the amount of property tax revenue determined pursuant to
subdivision (d) of Section 96.5 or its predecessor section to
jurisdictions in the tax rate area using the proportionate shares
derived pursuant to paragraph (3).
   (5) For purposes of the calculations made pursuant to Section 96.1
or its predecessor section, in the 1985-86 fiscal year and fiscal
years thereafter, the amounts allocated to qualifying cities pursuant
to this subdivision (notwithstanding any deduction made pursuant to
subdivision (e)) shall be deemed to be the "amount of property tax
revenue allocated pursuant to this chapter in the prior fiscal year."
   (c) "TEA formula" shall mean Tax Equity Allocation formula, and
shall be calculated by the auditor by applying a tax rate of ten
cents ($.10) per $100 assessed value to the 1983-84 assessed value of
the qualifying city.
   (d) "Qualifying city" shall mean any city in the County of Orange
that existed but did not levy a property tax in the 1977-78 fiscal
year.
   (e) The auditor may assess each qualifying city its proportional
share of the actual costs of making the calculations required by this
section, and may deduct that assessment from the amount allocated
pursuant to subdivision (b). For purposes of this subdivision, a
qualifying city's proportional share of the auditor's actual costs
shall not exceed the proportion it receives of the total amounts
excluded in the county pursuant to paragraph (1) of subdivision (a).



State Codes and Statutes

Statutes > California > Rtc > 98-98.1

REVENUE AND TAXATION CODE
SECTION 98-98.1



98.  (a) In each county, other than the County of Ventura, having
within its boundaries a qualifying city, the computations made
pursuant to Section 96.1 or its predecessor section, for the 1989-90
fiscal year and each fiscal year thereafter, shall be modified as
follows:
   With respect to tax rate areas within the boundaries of a
qualifying city, there shall be excluded from the aggregate amount of
"property tax revenue allocated pursuant to this chapter to local
agencies, other than for a qualifying city, in the prior fiscal year,"
an amount equal to the sum of the amounts calculated pursuant to the
TEA formula.
   (b) (1) Except as otherwise provided in this section, each
qualifying city shall, for the 1989-90 fiscal year and each fiscal
year thereafter, be allocated by the auditor an amount determined
pursuant to the TEA formula.
   (2) For each qualifying city, the auditor shall, for the 1989-90
fiscal year and each fiscal year thereafter, allocate the amount
determined pursuant to the TEA formula to all tax rate areas within
that city in proportion to each tax rate area's share of the total
assessed value in the city for the applicable fiscal year, and the
amount so determined shall be subtracted from the county's
proportionate share of property tax revenue for that fiscal year
within those tax rate areas.
   (3) After making the allocations pursuant to paragraphs (1) and
(2), but before making the calculations pursuant to Section 96.5 or
its predecessor section, the auditor shall, for all tax rate areas in
the qualifying city, calculate the proportionate share of property
tax revenue allocated pursuant to this section and Section 96.1, or
their predecessor sections, in the 1989-90 fiscal year and each
fiscal year thereafter to each jurisdiction in the tax rate area.
   (4) In lieu of making the allocations of annual tax increment
pursuant to subdivision (e) of Section 96.5 or its predecessor
section, the auditor shall, for the 1989-90 fiscal year and each
fiscal year thereafter, allocate the amount of property tax revenue
determined pursuant to subdivision (d) of Section 96.5 or its
predecessor section to jurisdictions in the tax rate area using the
proportionate shares derived pursuant to paragraph (3).
   (5) For purposes of the calculations made pursuant to Section 96.1
or its predecessor section, in the 1990-91 fiscal year and each
fiscal year thereafter, the amounts that would have been allocated to
qualifying cities pursuant to this subdivision shall be deemed to be
the "amount of property tax revenue allocated in the prior fiscal
year."
   (c) "TEA formula" means the Tax Equity Allocation formula, and
shall be calculated by the auditor for each qualifying city as
follows:
   (1) For the 1988-89 fiscal year and each fiscal year thereafter,
the auditor shall determine the total amount of property tax revenue
to be allocated to all jurisdictions in all tax rate areas within the
qualifying city, before the allocation and payment of funds in that
fiscal year to a community redevelopment agency within the qualifying
city, as provided in subdivision (b) of Section 33670 of the Health
and Safety Code.
   (2) The auditor shall determine the total amount of funds
allocated in each fiscal year to a community redevelopment agency in
accordance with subdivision (b) of Section 33670 of the Health and
Safety Code.
   (3) The auditor shall determine the total amount of funds paid in
each fiscal year by a community redevelopment agency within the city
to jurisdictions other than the city pursuant to subdivision (b) of
Section 33401 and Section 33676 of the Health and Safety Code, and
the cost to the redevelopment agency of any land or facilities
transferred and any amounts paid to jurisdictions other than the city
to assist in the construction or reconstruction of facilities
pursuant to an agreement entered into under Section 33401 or 33445.5
of the Health and Safety Code.
   (4) The auditor shall subtract the amount determined in paragraph
(3) from the amount determined in paragraph (2).
   (5) The auditor shall subtract the amount determined in paragraph
(4) from the amount determined in paragraph (1).
   (6) The amount computed in paragraph (5) shall be multiplied by
the following percentages in order to determine the TEA formula
amount to be distributed to the qualifying city in each fiscal year:
   (A) For the first fiscal year in which the qualifying city
receives a distribution pursuant to this section, 1 percent of the
amount determined in paragraph (5).
   (B) For the second fiscal year in which the qualifying city
receives a distribution pursuant to this section, 2 percent of the
amount determined in paragraph (5).
   (C) For the third fiscal year in which the qualifying city
receives a distribution pursuant to this section, 3 percent of the
amount determined in paragraph (5).
   (D) For the fourth fiscal year in which the qualifying city
receives a distribution pursuant to this section, 4 percent of the
amount determined in paragraph (5).
   (E) For the fifth fiscal year in which the qualifying city
receives a distribution pursuant to this section, 5 percent of the
amount determined in paragraph (5).
   (F) For the sixth fiscal year in which the qualifying city
receives a distribution pursuant to this section, 6 percent of the
amount determined in paragraph (5).
   (G) For the seventh fiscal year and each fiscal year thereafter in
which the city receives a distribution pursuant to this section, 7
percent of the amount determined in paragraph (5).
   (d) "Qualifying city" means any city, except a qualifying city as
defined in Section 98.1, that incorporated prior to June 5, 1987, and
had an amount of property tax revenue allocated to it pursuant to
subdivision (a) of Section 96.1 or its predecessor section in the
1988-89 fiscal year that is less than 7 percent of the amount of
property tax revenue computed as follows:
   (1) The auditor shall determine the total amount of property tax
revenue allocated to the city in the 1988-89 fiscal year.
   (2) The auditor shall subtract the amount in the 1988-89 fiscal
year determined in paragraph (3) of subdivision (c) from the amount
determined in paragraph (2) of subdivision (c).
   (3) The auditor shall subtract the amount determined in paragraph
(2) from the amount of property tax revenue determined in paragraph
(1) of subdivision (c).
   (4) The auditor shall divide the amount of property tax revenue
determined in paragraph (1) of this subdivision by the amount of
property tax revenue determined in paragraph (3) of this subdivision.
   (5) If the quotient determined in paragraph (4) of this
subdivision is less than 0.07, the city is a qualifying city. If the
quotient determined in that paragraph is equal to or greater than
0.07, the city is not a qualifying city.
   (e) The auditor may assess each qualifying city its proportional
share of the actual costs of making the calculations required by this
section, and may deduct that assessment from the amount allocated
pursuant to subdivision (b). For purposes of this subdivision, a
qualifying city's proportional share of the auditor's actual costs
shall not exceed the proportion it receives of the total amounts
excluded in the county pursuant to subdivision (a).
   (f) Notwithstanding subdivision (b), in any fiscal year in which a
qualifying city is to receive a distribution pursuant to this
section, the auditor shall reduce the actual amount distributed to
the qualifying city by the sum of the following:
   (1) The amount of property tax revenue that was exchanged between
the county and the qualifying city as a result of negotiation
pursuant to Section 99.03.
   (2) (A) The amount of revenue not collected by the qualifying city
in the first fiscal year following the city's reduction after
January 1, 1988, of the tax rate or tax base of any locally imposed
tax, except any tax that was imposed after January 1, 1988. In the
case of a tax that existed before January 1, 1988, this clause shall
apply only with respect to an amount attributable to a reduction of
the rate or base to a level lower than the rate or base applicable on
January 1, 1988. The amount so computed by the auditor shall
constitute a reduction in the amount of property tax revenue
distributed to the qualifying city pursuant to this section in each
succeeding fiscal year. That amount shall be aggregated with any
additional amount computed pursuant to this clause as the result of
the city's reduction in any subsequent year of the tax rate or tax
base of the same or any other locally imposed general or special tax.
   (B) No reduction may be made pursuant to subparagraph (A) in the
case in which a local tax is reduced or eliminated as a result of
either a court decision or the approval or rejection of a ballot
measure by the voters.
   (3) The amount of property tax revenue received pursuant to this
chapter in excess of the amount allocated for the 1986-87 fiscal year
by all special districts that are governed by the city council of
the qualifying city or whose governing body is the same as the city
council of the qualifying city with respect to all tax rate areas
within the boundaries of the qualifying city.
   Notwithstanding this paragraph:
   (A) Commencing with the 1994-95 fiscal year, the auditor shall not
reduce the amount distributed to a qualifying city under this
section by reason of that city becoming the successor agency to a
special district, that is dissolved, merged with that city, or
becomes a subsidiary district of that city, on or after July 1, 1994.
   (B) Commencing with the 1997-98 fiscal year, the auditor shall not
reduce the amount distributed to a qualifying city under this
section by reason of that city withdrawing from a county free library
system pursuant to Section 19116 of the Education Code.
   (4) Any amount of property tax revenues that has been exchanged
pursuant to Section 56842 of the Government Code between the City of
Rancho Mirage and a community services district, the formation of
which was initiated on or after March 6, 1997, pursuant to Chapter 4
(commencing with Section 56800) of Part 3 of Division 3 of Title 5 of
the Government Code.
   (g) Notwithstanding any other provision of this section, in no
event may the auditor reduce the amount of ad valorem property tax
revenue otherwise allocated to a qualifying city pursuant to this
section on the basis of any additional ad valorem property tax
revenues received by that city pursuant to a services for revenue
agreement. For purposes of this subdivision, a "services for revenue
agreement" means any agreement between a qualifying city and the
county in which it is located, entered into by joint resolution of
that city and that county, under which additional service
responsibilities are exchanged in consideration for additional
property tax revenues.
   (h) In any fiscal year in which a qualifying city is to receive a
distribution pursuant to this section, the auditor shall increase the
actual amount distributed to the qualifying city by the amount of
property tax revenue allocated to the qualifying city pursuant to
Section 19116 of the Education Code.
   (i) If the auditor determines that the amount to be distributed to
a qualifying city pursuant to subdivision (b), as modified by
subdivisions (e), (f), and (g) would result in a qualifying city
having proceeds of taxes in excess of its appropriation limit, the
auditor shall reduce the amount, on a dollar-for-dollar basis, by the
amount that exceeds the city's appropriations limit.
   (j) The amount not distributed to the tax rate areas of a
qualifying city as a result of this section shall be distributed by
the auditor to the county.
   (k) Notwithstanding any other provision of this section, no
qualifying city shall be distributed an amount pursuant to this
section that is less than the amount the city would have been
allocated without the application of the TEA formula.
   (l) Notwithstanding any other provision of this section, the
auditor shall not distribute any amount determined pursuant to this
section to any qualifying city that has in the prior fiscal year used
any revenues or issued bonds for the construction, acquisition, or
development, of any facility which is defined in Section 103(b)(4),
103(b)(5), or 103(b)(6) of the Internal Revenue Code of 1954 prior to
the enactment of the Tax Reform Act of 1986 (P.L. 99-514) and is no
longer eligible for tax-exempt financing.
   (m) (1) The amendments made to this section, and the repeal of
Section 98.04, by the act that added this subdivision shall apply for
the 2006-07 fiscal year and each fiscal year thereafter.
   (2) For the 2006-07 fiscal year and for each fiscal year
thereafter, all of the following apply:
   (A) The auditor of the County of Santa Clara shall do both of the
following:
   (i) Reduce the total amount of ad valorem property tax revenue
otherwise required to be allocated to qualifying cities in that
county by the ERAF reimbursement amount. This reduction for each
qualifying city in the county for each fiscal year shall be the
percentage share, of the total reduction required by this clause for
all qualifying cities in the county for the 2006-07 fiscal year, that
is equal to the proportion that the total amount of additional ad
valorem property tax revenue that is required to be allocated to the
qualifying city as a result of the act that added this subdivision
bears to the total amount of additional ad valorem property tax
revenue that is required to be allocated to all qualifying cities in
the county as a result of the act that added this subdivision.
   (ii) Increase the total amount of ad valorem property tax revenue
otherwise required to be allocated to the county Educational Revenue
Augmentation Fund by the ERAF reimbursement amount.
   (B) For purposes of this subdivision, "ERAF reimbursement amount"
means an amount equal to the difference between the following two
amounts:
   (i) The portion of the annual tax increment that would have been
allocated from the county to the county Educational Revenue
Augmentation Fund for the applicable fiscal year if the act that
added this subdivision had not been enacted.
   (ii) The portion of the annual tax increment that is allocated
from the county to the county Educational Revenue Augmentation Fund
for the applicable fiscal year.



98.01.  (a) An independent qualifying city shall receive a
distribution of the following percentages of the TEA formula, as
computed in subdivision (c) of Section 98, if the amount of that
distribution, less the applicable reductions provided for in
subdivisions (e), (f), and (g) of Section 98, would be greater than
the amount the city would have been allocated without the application
of the TEA formula:
   (1) Thirty-three and one-third percent of the amount determined in
subparagraph (G) of paragraph (6) of subdivision (c) of Section 98,
less any applicable reductions provided for in subdivisions (e), (f),
and (g) of Section 98, for the first fiscal year in which the
independent qualifying city receives an allocation pursuant to this
section.
   (2) Sixty-six and two-thirds percent of the amount determined in
subparagraph (G) of paragraph (6) of subdivision (c) of Section 98,
less any applicable reductions provided for in subdivisions (e), (f),
and (g) of Section 98, for the second fiscal year in which the
independent qualifying city receives an allocation pursuant to this
section.
   (3) One hundred percent of the amount determined in subparagraph
(G) of paragraph (6) of subdivision (c) of Section 98, less any
applicable reductions provided for in subdivisions (e), (f), and (g)
of Section 98, for the third fiscal year in which the independent
qualifying city receives an allocation pursuant to this section.
   The amount not distributed as a result of this subdivision to the
tax rate areas in each independent qualifying city, shall be
allocated by the auditor to the county. The auditor may assess each
independent qualifying city its proportional share of the actual
costs of making the calculations required by this subdivision, and
may deduct that assessment from the amount allocated pursuant to this
subdivision. For purposes of this subdivision, an independent
qualifying city's proportional share of the auditor's actual costs
shall not exceed the proportion it receives of the total amounts
excluded in the county pursuant to subdivision (a) of Section 98.
   (b) "Independent qualifying city" means a qualifying city, as
defined in Section 98, in the County of Los Angeles which met the
following criteria on January 1, 1988:
   (1) Was not served by a special district which received a portion
of the 1 percent property tax revenue, and provided any of the
following services to the qualified city:
   (A) Emergency medical services.
   (B) Fire prevention services.
   (C) Fire suppression.
   (D) Libraries.
   (E) Parks.
   (F) Recreation services.
   (G) Street lighting.
   (2) Did not have redevelopment project areas which receive
property tax revenues.
   (3) The county general fund received greater than 65 percent of
the 1 percent property tax revenues collected from tax rate areas
within the qualifying city's boundaries.


98.02.  (a) In the County of Ventura, the computations made pursuant
to Section 96.1 or its predecessor section, for the 1989-90 fiscal
year and each fiscal year thereafter, shall be modified as follows:
   With respect to tax rate areas, except excluded tax rate areas,
within the boundaries of a qualifying city, there shall be excluded
from the aggregate amount of "property tax revenue allocated pursuant
to this chapter to local agencies, other than for a qualifying city,
in the prior fiscal year," an amount equal to the sum of the amounts
calculated pursuant to the TEA formula.
   (b) (1) Each qualifying city shall, for the 1989-90 fiscal year
and each fiscal year thereafter, be allocated by the auditor an
amount determined pursuant to the TEA formula.
   (2) For each qualifying city, the auditor shall, for the 1989-90
fiscal year and each fiscal year thereafter, distribute the amount
determined pursuant to the TEA formula to all tax rate areas, except
excluded tax rate areas, within that city in proportion to each tax
rate area's share of the total assessed value in the city for the
applicable fiscal year, and the amount so determined shall be
subtracted from the county's proportionate share of the property tax
revenue for that fiscal year within those tax rate areas.
   (3) After making the allocations pursuant to paragraphs (1) and
(2), but before making the calculations pursuant to Section 96.5 or
its predecessor section, the auditor shall, for all tax rate areas,
except excluded tax rate areas, in the qualifying city, calculate the
proportionate share of property tax revenue allocated pursuant to
this section and Section 96.1, or their predecessor sections, in the
1989-90 fiscal year and each fiscal year thereafter to each
jurisdiction in the tax rate area.
   (4) In lieu of making the allocations of annual tax increment
pursuant to subdivision (e) of Section 96.5 or its predecessor
section, the auditor shall for the 1989-90 fiscal year and each
fiscal year thereafter, allocate the amount of property tax revenue
determined pursuant to subdivision (d) of Section 98 to jurisdictions
in the tax rate area, except an excluded tax rate area, using the
proportionate shares derived pursuant to paragraph (3).
   (5) For purposes of the calculations made pursuant to Section 96.1
or its predecessor section, in the 1990-91 fiscal year and each
fiscal year thereafter, the amounts that would have been allocated to
all tax rate areas, except excluded tax rate areas, of qualifying
cities pursuant to this subdivision shall be deemed to be the "amount
of property tax revenue allocated to those tax rate areas in the
prior fiscal year."
   (c) "TEA formula" means the Tax Equity Allocation formula, and
shall be calculated by the auditor for each qualifying city as
follows:
   (1) For the 1988-89 fiscal year and each fiscal year thereafter,
the auditor shall determine the total amount of property tax revenue
to be allocated to all jurisdictions in all tax rate areas, except
excluded tax rate areas, within the qualifying city, before the
allocation and payment of funds in that fiscal year to a community
redevelopment agency within the qualifying city, as provided in
subdivision (b) of Section 33670 of the Health and Safety Code.
   (2) The auditor shall determine the amount of funds allocated in
each fiscal year to those tax rate areas, except excluded tax rate
areas, within a community redevelopment agency in accordance with
subdivision (b) of Section 33670 of the Health and Safety Code.
   (3) (A) The auditor shall determine the total amount of funds paid
in each fiscal year by a community redevelopment agency within the
city to jurisdictions other than the city pursuant to subdivision (b)
of Section 33401 and Section 33676 of the Health and Safety Code,
and the cost to the redevelopment agency of any land or facilities
transferred and any amounts paid to jurisdictions other than the city
to assist in the construction or reconstruction of facilities
pursuant to an agreement entered into under Section 33401 or 33445.5
of the Health and Safety Code.
   (B) Of the total amount determined in subparagraph (A), the
auditor shall compute a proportionate amount to be attributed to all
tax rate areas, except excluded tax rate areas, within the community
redevelopment agency. That proportionate amount shall be equal to
that proportion which the amount determined in paragraph (2) in each
fiscal year bears to the total amount of funds allocated in each
fiscal year to a community redevelopment agency in accordance with
subdivision (b) of Section 33670 of the Health and Safety Code.
   (4) The auditor shall subtract the amount determined in
subparagraph (B) of paragraph (3) from the amount determined in
paragraph (2).
   (5) The auditor shall subtract the amount determined in paragraph
(4) from the amount determined in paragraph (1).
   (6) The amount computed in paragraph (5) shall be multiplied by
the following percentages in order to determine the TEA formula
amount to be distributed to the qualifying city in each fiscal year:
   (A) For the first fiscal year in which the qualifying city
receives a distribution pursuant to this section, 1 percent of the
amount determined in paragraph (5).
   (B) For the second fiscal year in which the qualifying city
receives a distribution pursuant to this section, 2 percent of the
amount determined in paragraph (5).
   (C) For the third fiscal year in which the qualifying city
receives a distribution pursuant to this section, 3 percent of the
amount determined in paragraph (5).
   (D) For the fourth fiscal year and each fiscal year thereafter in
which the qualifying city receives a distribution pursuant to this
section, 4 percent of the amount determined in paragraph (5).
   (d) For purposes of this section, "excluded tax rate area" means
either of the following:
   (1) Any tax rate area included in territory annexed by the
qualifying city and allocated a prescribed percentage of property tax
revenue pursuant to an existing agreement between the qualifying
city and the county.
   (2) Any tax rate area described in paragraph (1) that was detached
from the county library district and that is also allocated an
additional prescribed percentage of property tax revenue pursuant to
an existing agreement between the qualifying city and the county.
   (e) (1) All existing agreements between the qualifying city and
the county covering the allocation of property tax revenues to tax
rate areas described in subdivision (d) shall remain in force.
   (2) All existing agreements between the qualifying city and the
county covering the allocation of property tax revenues to tax rate
areas that were detached from the county library district but are not
included in territory that was annexed by the qualifying city shall
remain in force.
   (3) All allocations to those tax rate areas described in
subdivision (d), including allocations of annual tax increments, made
pursuant to the existing agreements between the qualifying city and
the county shall be governed by subdivision (a) of Section 96.1 and
Section 96.5.
   (4) All allocations to those tax rate areas described in paragraph
(2), including allocations of annual tax increments, made pursuant
to the existing agreements between the qualifying city and the county
shall be governed by subdivision (a) of Section 96.1 and Section
96.5. However, the tax rate areas referred to in this paragraph shall
also be distributed an amount of property tax revenue determined
pursuant to the TEA formula that is over and above the amount
allocated as provided in the preceding sentence.
   (f) "Qualifying city" means any city that incorporated prior to
June 5, 1987, and had an amount of property tax revenue allocated to
it pursuant to subdivision (a) of Section 96.1 or its predecessor
section in the 1988-89 fiscal year that is less than 4 percent of the
amount of property tax revenue computed as follows:
   (1) The auditor shall determine the total amount of property tax
revenue allocated to all tax rate areas, except excluded tax rate
areas, in the city in the 1988-89 fiscal year.
   (2) The auditor shall subtract the amount in the 1988-89 fiscal
year determined in paragraph (3) of subdivision (c) from the amount
determined in paragraph (2) of subdivision (c).
   (3) The auditor shall subtract the amount determined in paragraph
(2) from the amount of property tax revenue in paragraph (1) of
subdivision (c).
   (4) The auditor shall divide the amount of property tax revenue
determined in paragraph (1) of this subdivision by the amount of
property tax revenue determined in paragraph (3) of this subdivision.
   (5) If the quotient determined in paragraph (4) of this
subdivision is less than 0.04, the city is a qualifying city. If the
quotient determined in that paragraph is equal to or greater than
0.04, the city is not a qualifying city.
   (g) The auditor may assess each qualifying city its proportional
share of the actual costs of making the calculations required by this
section, and may deduct that assessment from the amount allocated
pursuant to subdivision (b). For purposes of this subdivision, a
qualifying city's proportional share of the auditor's actual costs
shall not exceed the proportion it receives of the total amounts
excluded in the county pursuant to subdivision (a).
   (h) (1) Notwithstanding subdivision (b), except as otherwise
provided in paragraph (2), in any fiscal year in which a qualifying
city receives a distribution pursuant to this section, the auditor
shall reduce the actual amount distributed to the qualifying city by
the amount of revenue not collected by the qualifying city in the
first fiscal year following the city's reduction after January 1,
1988, of the tax rate or tax base of any locally imposed general or
special tax. The amount so computed by the auditor shall constitute a
reduction in the amount of property tax revenue distributed to the
qualifying city pursuant to this section in each succeeding fiscal
year. That amount shall be aggregated with any additional amount
computed pursuant to this paragraph as the result of the city's
reduction in any subsequent year of the tax rate or tax base of the
same or any other locally imposed general or special tax.
   (2) No reduction shall be made pursuant to paragraph (1) in the
case in which a local tax is reduced or eliminated as a result of
either a court decision or the approval or rejection of a ballot
measure by the voters.
   (i) If the auditor determines that the amount to be distributed to
a qualifying city pursuant to subdivision (b), as modified by
subdivisions (g) and (h), would result in a qualifying city having
proceeds of taxes in excess of its appropriation limit, the auditor
shall reduce the amount, on a dollar-for-dollar basis, by the amount
that exceeds the city's appropriations limit.
   (j) Notwithstanding any other provision of this section, no
qualifying city shall be distributed an amount pursuant to this
section that is less than the amount the city would have been
allocated without the application of the TEA formula.
   (k) (1) Notwithstanding any other provision of this section,
commencing with the 1994-95 fiscal year, the auditor shall not reduce
the amount distributed to a qualifying city under this section by
reason of that city becoming the successor agency to a special
district that is dissolved, merged with that city, or becomes a
subsidiary district of that city, on or after July 1, 1994.
   (2) Notwithstanding any other provision of this section, in no
event may the auditor reduce the amount of ad valorem property tax
revenue otherwise allocated to a qualifying city pursuant to this
section on the basis of any additional ad valorem property tax
revenues received by that city pursuant to a services for revenue
agreement. For purposes of this subdivision, a "services for revenue
agreement" means any agreement between a qualifying city and the
county in which it is located, entered into by joint resolution of
that city and that county, under which additional service
responsibilities are exchanged in consideration for additional
property tax revenues.
   (l) The amount not distributed as a result of this section to the
tax rate areas, except excluded tax rate areas, in each qualifying
city shall be allocated by the auditor to the county.




98.03.  For purposes of Section 98, the definition of qualifying
city contained in subdivision (d) of that section shall not include
the City of Foster City.


98.1.  (a) In the County of Orange, the computations made pursuant
to Section 96.1 or its predecessor section, for the 1984-85 fiscal
year only, shall be modified as follows:
   (1) With respect to tax rate areas within the boundaries of a
qualifying city, there shall be excluded from the aggregate amount of
"property tax revenue allocated pursuant to this chapter to local
agencies, other than for a qualifying city, in the prior fiscal year,"
an amount equal to the sum of amounts calculated pursuant to the TEA
formula, as defined in subdivision (c).
   (2) The amount excluded pursuant to paragraph (1) shall be
subtracted from the allocations of all local agencies other than a
qualifying city with tax rate areas within the boundaries of a
qualifying city in proportion to each such local agency's share of
the total 1983-84 property tax revenues, as defined in subdivision
(c) of Section 95, allocated to all those tax rate areas.
   (b) (1) Each qualifying city, as defined in subdivision (d), shall
for the 1984-85 fiscal year only, be allocated by the auditor an
amount determined pursuant to the TEA formula, as defined in
subdivision (c).
   (2) For each qualifying city, the auditor shall distribute the
amount determined pursuant to the TEA formula to all tax rate areas
within the city in proportion to each tax rate area's share of the
total 1983-84 assessed value in the city.
   (3) After making the allocations, pursuant to paragraphs (1) and
(2) but before making the calculations pursuant to Section 96.5, the
auditor shall, for all tax rate areas in the qualifying city,
calculate the proportionate share of property tax revenue allocated
pursuant to this section and Section 96.1 in the 1984-85 fiscal year
to each jurisdiction in the tax rate area.
   (4) In lieu of making the allocations of annual tax increment
pursuant to subdivision (e) of Section 96.5 or its predecessor
section, the auditor shall for the 1984-85 fiscal year only, allocate
the amount of property tax revenue determined pursuant to
subdivision (d) of Section 96.5 or its predecessor section to
jurisdictions in the tax rate area using the proportionate shares
derived pursuant to paragraph (3).
   (5) For purposes of the calculations made pursuant to Section 96.1
or its predecessor section, in the 1985-86 fiscal year and fiscal
years thereafter, the amounts allocated to qualifying cities pursuant
to this subdivision (notwithstanding any deduction made pursuant to
subdivision (e)) shall be deemed to be the "amount of property tax
revenue allocated pursuant to this chapter in the prior fiscal year."
   (c) "TEA formula" shall mean Tax Equity Allocation formula, and
shall be calculated by the auditor by applying a tax rate of ten
cents ($.10) per $100 assessed value to the 1983-84 assessed value of
the qualifying city.
   (d) "Qualifying city" shall mean any city in the County of Orange
that existed but did not levy a property tax in the 1977-78 fiscal
year.
   (e) The auditor may assess each qualifying city its proportional
share of the actual costs of making the calculations required by this
section, and may deduct that assessment from the amount allocated
pursuant to subdivision (b). For purposes of this subdivision, a
qualifying city's proportional share of the auditor's actual costs
shall not exceed the proportion it receives of the total amounts
excluded in the county pursuant to paragraph (1) of subdivision (a).




State Codes and Statutes

State Codes and Statutes

Statutes > California > Rtc > 98-98.1

REVENUE AND TAXATION CODE
SECTION 98-98.1



98.  (a) In each county, other than the County of Ventura, having
within its boundaries a qualifying city, the computations made
pursuant to Section 96.1 or its predecessor section, for the 1989-90
fiscal year and each fiscal year thereafter, shall be modified as
follows:
   With respect to tax rate areas within the boundaries of a
qualifying city, there shall be excluded from the aggregate amount of
"property tax revenue allocated pursuant to this chapter to local
agencies, other than for a qualifying city, in the prior fiscal year,"
an amount equal to the sum of the amounts calculated pursuant to the
TEA formula.
   (b) (1) Except as otherwise provided in this section, each
qualifying city shall, for the 1989-90 fiscal year and each fiscal
year thereafter, be allocated by the auditor an amount determined
pursuant to the TEA formula.
   (2) For each qualifying city, the auditor shall, for the 1989-90
fiscal year and each fiscal year thereafter, allocate the amount
determined pursuant to the TEA formula to all tax rate areas within
that city in proportion to each tax rate area's share of the total
assessed value in the city for the applicable fiscal year, and the
amount so determined shall be subtracted from the county's
proportionate share of property tax revenue for that fiscal year
within those tax rate areas.
   (3) After making the allocations pursuant to paragraphs (1) and
(2), but before making the calculations pursuant to Section 96.5 or
its predecessor section, the auditor shall, for all tax rate areas in
the qualifying city, calculate the proportionate share of property
tax revenue allocated pursuant to this section and Section 96.1, or
their predecessor sections, in the 1989-90 fiscal year and each
fiscal year thereafter to each jurisdiction in the tax rate area.
   (4) In lieu of making the allocations of annual tax increment
pursuant to subdivision (e) of Section 96.5 or its predecessor
section, the auditor shall, for the 1989-90 fiscal year and each
fiscal year thereafter, allocate the amount of property tax revenue
determined pursuant to subdivision (d) of Section 96.5 or its
predecessor section to jurisdictions in the tax rate area using the
proportionate shares derived pursuant to paragraph (3).
   (5) For purposes of the calculations made pursuant to Section 96.1
or its predecessor section, in the 1990-91 fiscal year and each
fiscal year thereafter, the amounts that would have been allocated to
qualifying cities pursuant to this subdivision shall be deemed to be
the "amount of property tax revenue allocated in the prior fiscal
year."
   (c) "TEA formula" means the Tax Equity Allocation formula, and
shall be calculated by the auditor for each qualifying city as
follows:
   (1) For the 1988-89 fiscal year and each fiscal year thereafter,
the auditor shall determine the total amount of property tax revenue
to be allocated to all jurisdictions in all tax rate areas within the
qualifying city, before the allocation and payment of funds in that
fiscal year to a community redevelopment agency within the qualifying
city, as provided in subdivision (b) of Section 33670 of the Health
and Safety Code.
   (2) The auditor shall determine the total amount of funds
allocated in each fiscal year to a community redevelopment agency in
accordance with subdivision (b) of Section 33670 of the Health and
Safety Code.
   (3) The auditor shall determine the total amount of funds paid in
each fiscal year by a community redevelopment agency within the city
to jurisdictions other than the city pursuant to subdivision (b) of
Section 33401 and Section 33676 of the Health and Safety Code, and
the cost to the redevelopment agency of any land or facilities
transferred and any amounts paid to jurisdictions other than the city
to assist in the construction or reconstruction of facilities
pursuant to an agreement entered into under Section 33401 or 33445.5
of the Health and Safety Code.
   (4) The auditor shall subtract the amount determined in paragraph
(3) from the amount determined in paragraph (2).
   (5) The auditor shall subtract the amount determined in paragraph
(4) from the amount determined in paragraph (1).
   (6) The amount computed in paragraph (5) shall be multiplied by
the following percentages in order to determine the TEA formula
amount to be distributed to the qualifying city in each fiscal year:
   (A) For the first fiscal year in which the qualifying city
receives a distribution pursuant to this section, 1 percent of the
amount determined in paragraph (5).
   (B) For the second fiscal year in which the qualifying city
receives a distribution pursuant to this section, 2 percent of the
amount determined in paragraph (5).
   (C) For the third fiscal year in which the qualifying city
receives a distribution pursuant to this section, 3 percent of the
amount determined in paragraph (5).
   (D) For the fourth fiscal year in which the qualifying city
receives a distribution pursuant to this section, 4 percent of the
amount determined in paragraph (5).
   (E) For the fifth fiscal year in which the qualifying city
receives a distribution pursuant to this section, 5 percent of the
amount determined in paragraph (5).
   (F) For the sixth fiscal year in which the qualifying city
receives a distribution pursuant to this section, 6 percent of the
amount determined in paragraph (5).
   (G) For the seventh fiscal year and each fiscal year thereafter in
which the city receives a distribution pursuant to this section, 7
percent of the amount determined in paragraph (5).
   (d) "Qualifying city" means any city, except a qualifying city as
defined in Section 98.1, that incorporated prior to June 5, 1987, and
had an amount of property tax revenue allocated to it pursuant to
subdivision (a) of Section 96.1 or its predecessor section in the
1988-89 fiscal year that is less than 7 percent of the amount of
property tax revenue computed as follows:
   (1) The auditor shall determine the total amount of property tax
revenue allocated to the city in the 1988-89 fiscal year.
   (2) The auditor shall subtract the amount in the 1988-89 fiscal
year determined in paragraph (3) of subdivision (c) from the amount
determined in paragraph (2) of subdivision (c).
   (3) The auditor shall subtract the amount determined in paragraph
(2) from the amount of property tax revenue determined in paragraph
(1) of subdivision (c).
   (4) The auditor shall divide the amount of property tax revenue
determined in paragraph (1) of this subdivision by the amount of
property tax revenue determined in paragraph (3) of this subdivision.
   (5) If the quotient determined in paragraph (4) of this
subdivision is less than 0.07, the city is a qualifying city. If the
quotient determined in that paragraph is equal to or greater than
0.07, the city is not a qualifying city.
   (e) The auditor may assess each qualifying city its proportional
share of the actual costs of making the calculations required by this
section, and may deduct that assessment from the amount allocated
pursuant to subdivision (b). For purposes of this subdivision, a
qualifying city's proportional share of the auditor's actual costs
shall not exceed the proportion it receives of the total amounts
excluded in the county pursuant to subdivision (a).
   (f) Notwithstanding subdivision (b), in any fiscal year in which a
qualifying city is to receive a distribution pursuant to this
section, the auditor shall reduce the actual amount distributed to
the qualifying city by the sum of the following:
   (1) The amount of property tax revenue that was exchanged between
the county and the qualifying city as a result of negotiation
pursuant to Section 99.03.
   (2) (A) The amount of revenue not collected by the qualifying city
in the first fiscal year following the city's reduction after
January 1, 1988, of the tax rate or tax base of any locally imposed
tax, except any tax that was imposed after January 1, 1988. In the
case of a tax that existed before January 1, 1988, this clause shall
apply only with respect to an amount attributable to a reduction of
the rate or base to a level lower than the rate or base applicable on
January 1, 1988. The amount so computed by the auditor shall
constitute a reduction in the amount of property tax revenue
distributed to the qualifying city pursuant to this section in each
succeeding fiscal year. That amount shall be aggregated with any
additional amount computed pursuant to this clause as the result of
the city's reduction in any subsequent year of the tax rate or tax
base of the same or any other locally imposed general or special tax.
   (B) No reduction may be made pursuant to subparagraph (A) in the
case in which a local tax is reduced or eliminated as a result of
either a court decision or the approval or rejection of a ballot
measure by the voters.
   (3) The amount of property tax revenue received pursuant to this
chapter in excess of the amount allocated for the 1986-87 fiscal year
by all special districts that are governed by the city council of
the qualifying city or whose governing body is the same as the city
council of the qualifying city with respect to all tax rate areas
within the boundaries of the qualifying city.
   Notwithstanding this paragraph:
   (A) Commencing with the 1994-95 fiscal year, the auditor shall not
reduce the amount distributed to a qualifying city under this
section by reason of that city becoming the successor agency to a
special district, that is dissolved, merged with that city, or
becomes a subsidiary district of that city, on or after July 1, 1994.
   (B) Commencing with the 1997-98 fiscal year, the auditor shall not
reduce the amount distributed to a qualifying city under this
section by reason of that city withdrawing from a county free library
system pursuant to Section 19116 of the Education Code.
   (4) Any amount of property tax revenues that has been exchanged
pursuant to Section 56842 of the Government Code between the City of
Rancho Mirage and a community services district, the formation of
which was initiated on or after March 6, 1997, pursuant to Chapter 4
(commencing with Section 56800) of Part 3 of Division 3 of Title 5 of
the Government Code.
   (g) Notwithstanding any other provision of this section, in no
event may the auditor reduce the amount of ad valorem property tax
revenue otherwise allocated to a qualifying city pursuant to this
section on the basis of any additional ad valorem property tax
revenues received by that city pursuant to a services for revenue
agreement. For purposes of this subdivision, a "services for revenue
agreement" means any agreement between a qualifying city and the
county in which it is located, entered into by joint resolution of
that city and that county, under which additional service
responsibilities are exchanged in consideration for additional
property tax revenues.
   (h) In any fiscal year in which a qualifying city is to receive a
distribution pursuant to this section, the auditor shall increase the
actual amount distributed to the qualifying city by the amount of
property tax revenue allocated to the qualifying city pursuant to
Section 19116 of the Education Code.
   (i) If the auditor determines that the amount to be distributed to
a qualifying city pursuant to subdivision (b), as modified by
subdivisions (e), (f), and (g) would result in a qualifying city
having proceeds of taxes in excess of its appropriation limit, the
auditor shall reduce the amount, on a dollar-for-dollar basis, by the
amount that exceeds the city's appropriations limit.
   (j) The amount not distributed to the tax rate areas of a
qualifying city as a result of this section shall be distributed by
the auditor to the county.
   (k) Notwithstanding any other provision of this section, no
qualifying city shall be distributed an amount pursuant to this
section that is less than the amount the city would have been
allocated without the application of the TEA formula.
   (l) Notwithstanding any other provision of this section, the
auditor shall not distribute any amount determined pursuant to this
section to any qualifying city that has in the prior fiscal year used
any revenues or issued bonds for the construction, acquisition, or
development, of any facility which is defined in Section 103(b)(4),
103(b)(5), or 103(b)(6) of the Internal Revenue Code of 1954 prior to
the enactment of the Tax Reform Act of 1986 (P.L. 99-514) and is no
longer eligible for tax-exempt financing.
   (m) (1) The amendments made to this section, and the repeal of
Section 98.04, by the act that added this subdivision shall apply for
the 2006-07 fiscal year and each fiscal year thereafter.
   (2) For the 2006-07 fiscal year and for each fiscal year
thereafter, all of the following apply:
   (A) The auditor of the County of Santa Clara shall do both of the
following:
   (i) Reduce the total amount of ad valorem property tax revenue
otherwise required to be allocated to qualifying cities in that
county by the ERAF reimbursement amount. This reduction for each
qualifying city in the county for each fiscal year shall be the
percentage share, of the total reduction required by this clause for
all qualifying cities in the county for the 2006-07 fiscal year, that
is equal to the proportion that the total amount of additional ad
valorem property tax revenue that is required to be allocated to the
qualifying city as a result of the act that added this subdivision
bears to the total amount of additional ad valorem property tax
revenue that is required to be allocated to all qualifying cities in
the county as a result of the act that added this subdivision.
   (ii) Increase the total amount of ad valorem property tax revenue
otherwise required to be allocated to the county Educational Revenue
Augmentation Fund by the ERAF reimbursement amount.
   (B) For purposes of this subdivision, "ERAF reimbursement amount"
means an amount equal to the difference between the following two
amounts:
   (i) The portion of the annual tax increment that would have been
allocated from the county to the county Educational Revenue
Augmentation Fund for the applicable fiscal year if the act that
added this subdivision had not been enacted.
   (ii) The portion of the annual tax increment that is allocated
from the county to the county Educational Revenue Augmentation Fund
for the applicable fiscal year.



98.01.  (a) An independent qualifying city shall receive a
distribution of the following percentages of the TEA formula, as
computed in subdivision (c) of Section 98, if the amount of that
distribution, less the applicable reductions provided for in
subdivisions (e), (f), and (g) of Section 98, would be greater than
the amount the city would have been allocated without the application
of the TEA formula:
   (1) Thirty-three and one-third percent of the amount determined in
subparagraph (G) of paragraph (6) of subdivision (c) of Section 98,
less any applicable reductions provided for in subdivisions (e), (f),
and (g) of Section 98, for the first fiscal year in which the
independent qualifying city receives an allocation pursuant to this
section.
   (2) Sixty-six and two-thirds percent of the amount determined in
subparagraph (G) of paragraph (6) of subdivision (c) of Section 98,
less any applicable reductions provided for in subdivisions (e), (f),
and (g) of Section 98, for the second fiscal year in which the
independent qualifying city receives an allocation pursuant to this
section.
   (3) One hundred percent of the amount determined in subparagraph
(G) of paragraph (6) of subdivision (c) of Section 98, less any
applicable reductions provided for in subdivisions (e), (f), and (g)
of Section 98, for the third fiscal year in which the independent
qualifying city receives an allocation pursuant to this section.
   The amount not distributed as a result of this subdivision to the
tax rate areas in each independent qualifying city, shall be
allocated by the auditor to the county. The auditor may assess each
independent qualifying city its proportional share of the actual
costs of making the calculations required by this subdivision, and
may deduct that assessment from the amount allocated pursuant to this
subdivision. For purposes of this subdivision, an independent
qualifying city's proportional share of the auditor's actual costs
shall not exceed the proportion it receives of the total amounts
excluded in the county pursuant to subdivision (a) of Section 98.
   (b) "Independent qualifying city" means a qualifying city, as
defined in Section 98, in the County of Los Angeles which met the
following criteria on January 1, 1988:
   (1) Was not served by a special district which received a portion
of the 1 percent property tax revenue, and provided any of the
following services to the qualified city:
   (A) Emergency medical services.
   (B) Fire prevention services.
   (C) Fire suppression.
   (D) Libraries.
   (E) Parks.
   (F) Recreation services.
   (G) Street lighting.
   (2) Did not have redevelopment project areas which receive
property tax revenues.
   (3) The county general fund received greater than 65 percent of
the 1 percent property tax revenues collected from tax rate areas
within the qualifying city's boundaries.


98.02.  (a) In the County of Ventura, the computations made pursuant
to Section 96.1 or its predecessor section, for the 1989-90 fiscal
year and each fiscal year thereafter, shall be modified as follows:
   With respect to tax rate areas, except excluded tax rate areas,
within the boundaries of a qualifying city, there shall be excluded
from the aggregate amount of "property tax revenue allocated pursuant
to this chapter to local agencies, other than for a qualifying city,
in the prior fiscal year," an amount equal to the sum of the amounts
calculated pursuant to the TEA formula.
   (b) (1) Each qualifying city shall, for the 1989-90 fiscal year
and each fiscal year thereafter, be allocated by the auditor an
amount determined pursuant to the TEA formula.
   (2) For each qualifying city, the auditor shall, for the 1989-90
fiscal year and each fiscal year thereafter, distribute the amount
determined pursuant to the TEA formula to all tax rate areas, except
excluded tax rate areas, within that city in proportion to each tax
rate area's share of the total assessed value in the city for the
applicable fiscal year, and the amount so determined shall be
subtracted from the county's proportionate share of the property tax
revenue for that fiscal year within those tax rate areas.
   (3) After making the allocations pursuant to paragraphs (1) and
(2), but before making the calculations pursuant to Section 96.5 or
its predecessor section, the auditor shall, for all tax rate areas,
except excluded tax rate areas, in the qualifying city, calculate the
proportionate share of property tax revenue allocated pursuant to
this section and Section 96.1, or their predecessor sections, in the
1989-90 fiscal year and each fiscal year thereafter to each
jurisdiction in the tax rate area.
   (4) In lieu of making the allocations of annual tax increment
pursuant to subdivision (e) of Section 96.5 or its predecessor
section, the auditor shall for the 1989-90 fiscal year and each
fiscal year thereafter, allocate the amount of property tax revenue
determined pursuant to subdivision (d) of Section 98 to jurisdictions
in the tax rate area, except an excluded tax rate area, using the
proportionate shares derived pursuant to paragraph (3).
   (5) For purposes of the calculations made pursuant to Section 96.1
or its predecessor section, in the 1990-91 fiscal year and each
fiscal year thereafter, the amounts that would have been allocated to
all tax rate areas, except excluded tax rate areas, of qualifying
cities pursuant to this subdivision shall be deemed to be the "amount
of property tax revenue allocated to those tax rate areas in the
prior fiscal year."
   (c) "TEA formula" means the Tax Equity Allocation formula, and
shall be calculated by the auditor for each qualifying city as
follows:
   (1) For the 1988-89 fiscal year and each fiscal year thereafter,
the auditor shall determine the total amount of property tax revenue
to be allocated to all jurisdictions in all tax rate areas, except
excluded tax rate areas, within the qualifying city, before the
allocation and payment of funds in that fiscal year to a community
redevelopment agency within the qualifying city, as provided in
subdivision (b) of Section 33670 of the Health and Safety Code.
   (2) The auditor shall determine the amount of funds allocated in
each fiscal year to those tax rate areas, except excluded tax rate
areas, within a community redevelopment agency in accordance with
subdivision (b) of Section 33670 of the Health and Safety Code.
   (3) (A) The auditor shall determine the total amount of funds paid
in each fiscal year by a community redevelopment agency within the
city to jurisdictions other than the city pursuant to subdivision (b)
of Section 33401 and Section 33676 of the Health and Safety Code,
and the cost to the redevelopment agency of any land or facilities
transferred and any amounts paid to jurisdictions other than the city
to assist in the construction or reconstruction of facilities
pursuant to an agreement entered into under Section 33401 or 33445.5
of the Health and Safety Code.
   (B) Of the total amount determined in subparagraph (A), the
auditor shall compute a proportionate amount to be attributed to all
tax rate areas, except excluded tax rate areas, within the community
redevelopment agency. That proportionate amount shall be equal to
that proportion which the amount determined in paragraph (2) in each
fiscal year bears to the total amount of funds allocated in each
fiscal year to a community redevelopment agency in accordance with
subdivision (b) of Section 33670 of the Health and Safety Code.
   (4) The auditor shall subtract the amount determined in
subparagraph (B) of paragraph (3) from the amount determined in
paragraph (2).
   (5) The auditor shall subtract the amount determined in paragraph
(4) from the amount determined in paragraph (1).
   (6) The amount computed in paragraph (5) shall be multiplied by
the following percentages in order to determine the TEA formula
amount to be distributed to the qualifying city in each fiscal year:
   (A) For the first fiscal year in which the qualifying city
receives a distribution pursuant to this section, 1 percent of the
amount determined in paragraph (5).
   (B) For the second fiscal year in which the qualifying city
receives a distribution pursuant to this section, 2 percent of the
amount determined in paragraph (5).
   (C) For the third fiscal year in which the qualifying city
receives a distribution pursuant to this section, 3 percent of the
amount determined in paragraph (5).
   (D) For the fourth fiscal year and each fiscal year thereafter in
which the qualifying city receives a distribution pursuant to this
section, 4 percent of the amount determined in paragraph (5).
   (d) For purposes of this section, "excluded tax rate area" means
either of the following:
   (1) Any tax rate area included in territory annexed by the
qualifying city and allocated a prescribed percentage of property tax
revenue pursuant to an existing agreement between the qualifying
city and the county.
   (2) Any tax rate area described in paragraph (1) that was detached
from the county library district and that is also allocated an
additional prescribed percentage of property tax revenue pursuant to
an existing agreement between the qualifying city and the county.
   (e) (1) All existing agreements between the qualifying city and
the county covering the allocation of property tax revenues to tax
rate areas described in subdivision (d) shall remain in force.
   (2) All existing agreements between the qualifying city and the
county covering the allocation of property tax revenues to tax rate
areas that were detached from the county library district but are not
included in territory that was annexed by the qualifying city shall
remain in force.
   (3) All allocations to those tax rate areas described in
subdivision (d), including allocations of annual tax increments, made
pursuant to the existing agreements between the qualifying city and
the county shall be governed by subdivision (a) of Section 96.1 and
Section 96.5.
   (4) All allocations to those tax rate areas described in paragraph
(2), including allocations of annual tax increments, made pursuant
to the existing agreements between the qualifying city and the county
shall be governed by subdivision (a) of Section 96.1 and Section
96.5. However, the tax rate areas referred to in this paragraph shall
also be distributed an amount of property tax revenue determined
pursuant to the TEA formula that is over and above the amount
allocated as provided in the preceding sentence.
   (f) "Qualifying city" means any city that incorporated prior to
June 5, 1987, and had an amount of property tax revenue allocated to
it pursuant to subdivision (a) of Section 96.1 or its predecessor
section in the 1988-89 fiscal year that is less than 4 percent of the
amount of property tax revenue computed as follows:
   (1) The auditor shall determine the total amount of property tax
revenue allocated to all tax rate areas, except excluded tax rate
areas, in the city in the 1988-89 fiscal year.
   (2) The auditor shall subtract the amount in the 1988-89 fiscal
year determined in paragraph (3) of subdivision (c) from the amount
determined in paragraph (2) of subdivision (c).
   (3) The auditor shall subtract the amount determined in paragraph
(2) from the amount of property tax revenue in paragraph (1) of
subdivision (c).
   (4) The auditor shall divide the amount of property tax revenue
determined in paragraph (1) of this subdivision by the amount of
property tax revenue determined in paragraph (3) of this subdivision.
   (5) If the quotient determined in paragraph (4) of this
subdivision is less than 0.04, the city is a qualifying city. If the
quotient determined in that paragraph is equal to or greater than
0.04, the city is not a qualifying city.
   (g) The auditor may assess each qualifying city its proportional
share of the actual costs of making the calculations required by this
section, and may deduct that assessment from the amount allocated
pursuant to subdivision (b). For purposes of this subdivision, a
qualifying city's proportional share of the auditor's actual costs
shall not exceed the proportion it receives of the total amounts
excluded in the county pursuant to subdivision (a).
   (h) (1) Notwithstanding subdivision (b), except as otherwise
provided in paragraph (2), in any fiscal year in which a qualifying
city receives a distribution pursuant to this section, the auditor
shall reduce the actual amount distributed to the qualifying city by
the amount of revenue not collected by the qualifying city in the
first fiscal year following the city's reduction after January 1,
1988, of the tax rate or tax base of any locally imposed general or
special tax. The amount so computed by the auditor shall constitute a
reduction in the amount of property tax revenue distributed to the
qualifying city pursuant to this section in each succeeding fiscal
year. That amount shall be aggregated with any additional amount
computed pursuant to this paragraph as the result of the city's
reduction in any subsequent year of the tax rate or tax base of the
same or any other locally imposed general or special tax.
   (2) No reduction shall be made pursuant to paragraph (1) in the
case in which a local tax is reduced or eliminated as a result of
either a court decision or the approval or rejection of a ballot
measure by the voters.
   (i) If the auditor determines that the amount to be distributed to
a qualifying city pursuant to subdivision (b), as modified by
subdivisions (g) and (h), would result in a qualifying city having
proceeds of taxes in excess of its appropriation limit, the auditor
shall reduce the amount, on a dollar-for-dollar basis, by the amount
that exceeds the city's appropriations limit.
   (j) Notwithstanding any other provision of this section, no
qualifying city shall be distributed an amount pursuant to this
section that is less than the amount the city would have been
allocated without the application of the TEA formula.
   (k) (1) Notwithstanding any other provision of this section,
commencing with the 1994-95 fiscal year, the auditor shall not reduce
the amount distributed to a qualifying city under this section by
reason of that city becoming the successor agency to a special
district that is dissolved, merged with that city, or becomes a
subsidiary district of that city, on or after July 1, 1994.
   (2) Notwithstanding any other provision of this section, in no
event may the auditor reduce the amount of ad valorem property tax
revenue otherwise allocated to a qualifying city pursuant to this
section on the basis of any additional ad valorem property tax
revenues received by that city pursuant to a services for revenue
agreement. For purposes of this subdivision, a "services for revenue
agreement" means any agreement between a qualifying city and the
county in which it is located, entered into by joint resolution of
that city and that county, under which additional service
responsibilities are exchanged in consideration for additional
property tax revenues.
   (l) The amount not distributed as a result of this section to the
tax rate areas, except excluded tax rate areas, in each qualifying
city shall be allocated by the auditor to the county.




98.03.  For purposes of Section 98, the definition of qualifying
city contained in subdivision (d) of that section shall not include
the City of Foster City.


98.1.  (a) In the County of Orange, the computations made pursuant
to Section 96.1 or its predecessor section, for the 1984-85 fiscal
year only, shall be modified as follows:
   (1) With respect to tax rate areas within the boundaries of a
qualifying city, there shall be excluded from the aggregate amount of
"property tax revenue allocated pursuant to this chapter to local
agencies, other than for a qualifying city, in the prior fiscal year,"
an amount equal to the sum of amounts calculated pursuant to the TEA
formula, as defined in subdivision (c).
   (2) The amount excluded pursuant to paragraph (1) shall be
subtracted from the allocations of all local agencies other than a
qualifying city with tax rate areas within the boundaries of a
qualifying city in proportion to each such local agency's share of
the total 1983-84 property tax revenues, as defined in subdivision
(c) of Section 95, allocated to all those tax rate areas.
   (b) (1) Each qualifying city, as defined in subdivision (d), shall
for the 1984-85 fiscal year only, be allocated by the auditor an
amount determined pursuant to the TEA formula, as defined in
subdivision (c).
   (2) For each qualifying city, the auditor shall distribute the
amount determined pursuant to the TEA formula to all tax rate areas
within the city in proportion to each tax rate area's share of the
total 1983-84 assessed value in the city.
   (3) After making the allocations, pursuant to paragraphs (1) and
(2) but before making the calculations pursuant to Section 96.5, the
auditor shall, for all tax rate areas in the qualifying city,
calculate the proportionate share of property tax revenue allocated
pursuant to this section and Section 96.1 in the 1984-85 fiscal year
to each jurisdiction in the tax rate area.
   (4) In lieu of making the allocations of annual tax increment
pursuant to subdivision (e) of Section 96.5 or its predecessor
section, the auditor shall for the 1984-85 fiscal year only, allocate
the amount of property tax revenue determined pursuant to
subdivision (d) of Section 96.5 or its predecessor section to
jurisdictions in the tax rate area using the proportionate shares
derived pursuant to paragraph (3).
   (5) For purposes of the calculations made pursuant to Section 96.1
or its predecessor section, in the 1985-86 fiscal year and fiscal
years thereafter, the amounts allocated to qualifying cities pursuant
to this subdivision (notwithstanding any deduction made pursuant to
subdivision (e)) shall be deemed to be the "amount of property tax
revenue allocated pursuant to this chapter in the prior fiscal year."
   (c) "TEA formula" shall mean Tax Equity Allocation formula, and
shall be calculated by the auditor by applying a tax rate of ten
cents ($.10) per $100 assessed value to the 1983-84 assessed value of
the qualifying city.
   (d) "Qualifying city" shall mean any city in the County of Orange
that existed but did not levy a property tax in the 1977-78 fiscal
year.
   (e) The auditor may assess each qualifying city its proportional
share of the actual costs of making the calculations required by this
section, and may deduct that assessment from the amount allocated
pursuant to subdivision (b). For purposes of this subdivision, a
qualifying city's proportional share of the auditor's actual costs
shall not exceed the proportion it receives of the total amounts
excluded in the county pursuant to paragraph (1) of subdivision (a).