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In another budget-related lawsuit, the League of California Cities went to Sacramento Superior Court on Wednesday to pursue $130 million in vehicle taxes that cities previously received from the state.

Gov. Jerry Brown and Democratic lawmakers shifted those funds to local governments as part of the June budget to pay for public safety grants. It was a minor piece of the governor's $5.5 billion "realignment" plan to transfer state responsibilities to the local level.

The League of California Cities said the maneuver shortchanges city police departments and proves particularly harmful to four newly incorporated cities in Riverside County that were depending heavily on the money to finance their operations.

League executive director Chris McKenzie said he believes the budget violates three parts of the state constitution, including a 2010 voter-approved ballot measure that local governments sought to protect their payments from the state. The League has already filed suit against the state to block a budget move that would generate $1.7 billion from redevelopment agencies.

The League worked with Assemblyman Jose Solorio, D-Anaheim, on a bill to raise the vehicle license fee (VLF) by 0.15 percentage points in 2012 to reinstate state funding for cities and Orange County, but the proposal died in the Legislature. The state VLF dropped by half a percentage point on July 1.

Cities are not asking the court to block the transfer of vehicle license fees immediately, but they want the state to eventually return the funds to cities. McKenzie also suggested that the suit may motivate lawmakers to find additional money for cities or reverse the budget action.

"We hope we can get the court to take action quickly," McKenzie said. "We also believe the Legislature has the ability to address this quickly, and we hope they will. That's not to say we're not serious about the suit, we're very serious about the suit. But we'll also see what happens in the legislative process."

Department of Finance spokesman H.D. Palmer said he could not comment on the suit because his department had not yet seen it. But he said Finance does not believe the suit threatens funding for the governor's "realignment" package, slated to begin Saturday.


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