Budget plan may aid San Mateo County

A funding proposal based on a complicated vehicle license fee reimbursement formula tied to local school funding that could mean a loss of $70 million from last fiscal year for San Mateo County may have a fix in the joint legislative budget agreement plan released May 29.

“These funds are owed to the county and our local cities by the state regardless of a state budget deficit,” Assemblymember Diane Papan, D-San Mateo, said in a press release. “Ensuring this payment is not just a fiscal issue, but a matter of keeping our commitment to the community and maintaining essential local services.”

Gov. Gavin Newsom’s May budget revision did not include plans to reimburse the county, likely triggered by the state’s severe projected deficit — estimated to be about $28 billion. The state planned to withhold what it owes to San Mateo County, and it’s one of only three counties being denied such funds in the revision. That’s because, with only a few nonbasic aid districts in the county, the state has less of a legally binding obligation to pay it back. While the other two counties, Alpine and Mono, are in a similar predicament, their overall VLF shortfalls are much lower, county officials said.

Both the governor and Legislature propose their version of the state budget before it is finalized by June 30. Though still not approved, the inclusion in the legislative budget proposal should spell some relief for local officials as there were drastic concerns of substantial financial challenges without the funds. Coupled with already declining revenue due to economic contraction, local cities and the county could experience deeper revenue challenges.

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