Orange County and California Clash Over Schools Budget

Orange County officials and the California Department of Finance are coming to blows over property tax legislation in the Revenue & Taxation Code Section 97.70, writes Ronald Campbell at The Orange County Register.

According to the county's attorneys, the law requires the county to receive property tax from schools, yet state Department of Finance spokesman H.D. Palmer, claims that it is, in fact, the county that should hand the money over.

"We believe that that code section is clear on what the rules of the road are on how counties are to allocate the property tax for schools," Palmer said.

The code section has been described, at best, as "convoluted" by legislative staff. As yet there doesn't seem to be any give on either side, which indicates next year we could well see the case in court.

It all began last summer, when Governor Jerry Brown and the Legislature agreed on a maneuver that effectively took $49.5 million from Orange County. Yet when the Legislature didn't pass assemblyman Jose Solorio, D-Santa Ana emergency bill to reverse the money grab, the supervisors brought the lawyers in.

Since then the lawyers, in fact, concluded no new law was needed, and that Section 97.70 is enough to let the county to take $73.5 million from schools.

For local schools the total loss will be $110.4 million. Thanks to the triple flip, schools will have to pay an additional $37 on top of the $73.5 million.

Local schools are going to have to borrow money with interest to survive the rest of the school year, county Superintendent William M. Habermehl said this week.

Habermehl said the county maneuver could be devastating to schools.

"Is the state going to backfill Orange County, or is the state going to say, ‘We're going to owe it, we're going to defer it'?"

"If the state is going to give it to us, are they going to give it to us in August or September (or May or June)?"

"We've got a major problem, a huge deficit that our schools would be facing. It would be a huge disaster," Habermehl said.

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