San Mateo County officials fight for VLF in Sacramento: Fight over $157 million in funding for county, cities continues

The upcoming loss of $119 million in critical in-lieu vehicle license fee money that funds basic services San Mateo County and its cities would be a devastating blow to the area, county leaders said during a state Senate subcommittee hearing May 7. 

San Mateo County has long struggled with the unique bureaucratic mechanisms that deploy VLF funding. A 2004 change in the distribution system of VLF, which comes from taxes on California vehicles, tied reimbursement to county property tax revenue and the county’s school districts. 

But because the setup of San Mateo County’s existing educational revenue structures doesn’t qualify the county for the full in-lieu VLF amount, representatives are left to haggle for the money each year. That system has kept a fragile fiscal peace in prior years but, with only two-thirds of VLF paid to the county and its cities for last year and none allocated for the upcoming budget cycle, the situation has become dire, leaders warned. 

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