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Proposition A & C and Measure R Sales Taxes

The majority of Metro funding is provided from the Proposition A, C and Measure R local sales taxes. The Proposition A sales tax, approved by voters in 1980, is a one-half of 1% tax on most retail sales in the County. Metro returns 25% of the Proposition A tax to the cities in the County for transportation purposes. The balance of the Proposition A tax is restricted 35% for rail development and 40% for discretionary purposes. Almost all of the discretionary portion is used to fund bus service provided by Metro and 16 other municipal bus operators within the County.

The Proposition C sales tax, approved by voters in 1990, is an additional one-half of 1% tax on retail sales in the County. Metro returns 20% of the Proposition C tax to the cities in the County for transportation purposes. The balance of the Proposition C tax is restricted 40% for construction and operation of the bus transit and rail system; 5% to expand rail and bus security; 10% for commuter rail, construction of transit centers, park and ride lots and freeway bus stops; and 25% for transit-related improvements to freeways and state highways.

On November 3, 1998 an initiative affecting the Proposition A and Proposition C sales taxes, in the form of the Act of 1998, was submitted and approved by the voters of Los Angeles County. Pursuant to the Act of 1998 Metro is no longer allowed to expend Proposition A or Proposition C sales tax on the costs of planning, design, construction or operation of any “New Subway.” New Subway is defined to mean any rail line in a tunnel below the earth’s surface, except for the existing segments of the Metro Red Line. The Act of 1998 does not limit in any way the collection of the Proposition A or the Proposition C sales taxes.

Measure R was approved by 2/3 of the Los Angeles County voters in the November 2008 election.  Measure R is an ordinance authorizing an additional ½ of 1% sales tax to fund traffic relief and rail expansion according to an expenditure plan contained in the ordinance.  The Measure R sales tax became effective July 1, 2009 and will remain in effect for 30 years.

The following table presents collections of Proposition A, C and Measure R sales tax revenues (net of an administrative fee paid to the State Board of Equalization) for the fiscal years ending June 30, 1999 through June 30, 2013 ($ in thousands).

Fiscal Year Proposition A Sales Tax Receipts Proposition C Sales Tax Receipts Measure R Sales Tax Receipts
1999 $449,054 $452,232  
2000 $504,353 $505,949  
2001 $528,299 $528,432  
2002 $525,980 $525,876  
2003 $548,287 $548,264  
2004 $576,651 $576,655  
2005 $619,497 $619,575  
2006 $668,984 $669,025  
2007 $686,167 $686,308  
2008 $683,352 $683,530  
2009 $620,797 $620,866  
2010 $565,746 $565,787 $551,480
2011 $601,883 $601,932 $598,647
2012 $648,692 $648,776 $645,026
2013 $687,172 $687,332 $684,862

 

Monthly Sales Tax Receipts (September 2014)


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