Balancing Accountability and Flexibility in California’s Local Option Sales Taxes

Abstract

Voter-approved Local Option Transportation Sales Taxes (LOSTs) are a major source of revenue for transportation programs in California. LOSTs list projects and programs for voter approval that are to be implemented over long periods of time, often twenty or more years. To respond to changing conditions, agencies often need to amend voter-approved plans. Implementing agencies must be accountable to voters, balancing the need to fulfill commitments made against needs that change over time. Using the text of ballot measures,public utility codes, periodic agency reports, and case studies that included interviews of public officials, this study examines, provisions regarding accountability in California LOSTs, and procedures for amending proposed expenditures.It also reviews lawsuits brought in relation to accountability and plan amendments. It analyzes the ways in which California counties achieve needed flexibility within a framework that demands accountability to the voters.Requirements and patterns differ among counties, but most measures have been adapted to changing circumstances.

About the Project

Local Option Sales Taxes (LOSTs) are a popular form of local transportation finance in California. Researchers partially attribute the success of LOSTs to the inclusion of expenditure plans that outline specific projects and services to be delivered using measure revenue over the 20 or more years the measure will be in place. Expenditure plans are commitments on the part of sponsoring transportation agencies, but issues of accountability might compromise these commitments and we are not aware of any prior research into the tension between commitments to projects and commitments to accountability that are both included in LOSTs.This research will examine how well expenditure plans presented in measures reflect actual project delivery over the life of the sales tax.