Chapter 3. Highway Users Tax Account of California Streets And Highways Code >> Division 3. >> Chapter 3.

The Highway Users Tax Fund is continued in existence as the Highway Users Tax Account in the Transportation Tax Fund. Any reference in any law or regulation to the Highway Users Tax Fund shall be deemed to refer to the Highway Users Tax Account in the Transportation Tax Fund. Notwithstanding any other provision of law, the Controller may use the funds in the Highway Users Tax Account in the Transportation Tax Fund for cashflow loans to the General Fund as provided in Sections 16310 and 16381 of the Government Code. Any such loan shall be exempt from paragraph (2) of subdivision (b) of Section 16310 of the Government Code. Interest shall be paid on all moneys loaned to the General Fund and shall be computed at a rate determined by the Pooled Money Investment Board to be the current earning rate of the fund from which the money is loaned. This subdivision does not authorize any transfer that would interfere with the carrying out of the object for which these funds were created.

Notwithstanding Section 13340 of the Government Code, all moneys in the Highway Users Tax Account in the Transportation Tax Fund and hereafter received in the account are appropriated for all of the following:
  (a) The research, planning, construction, improvement, maintenance, and operation of public streets and highways (and their related public facilities for nonmotorized traffic), including the mitigation of their environmental effects, the payment for property taken or damaged for such purposes, and the administrative costs necessarily incurred in the foregoing purposes.
  (b) The research and planning for exclusive public mass transit guideways (and their related fixed facilities), the payment for property taken or damaged for such purposes, and the administrative costs necessarily incurred in the foregoing purposes.
  (c) The construction and improvement of exclusive public mass transit guideways (and their related fixed facilities), including the mitigation of their environmental effects, the payment for property taken or damaged for such purposes, the administrative costs necessarily incurred in the foregoing purposes, and the maintenance of the structures and the immediate right-of-way for the public mass transit guideways, but excluding the maintenance and operating costs for mass transit power systems and mass transit passenger facilities, vehicles, equipment, and services, in any area where the voters thereof have approved a proposition pursuant to Section 4 of Article XIX of the California Constitution.
  (d) The payment of principal and interest on voter-approved bonds issued for the purposes specified in subdivision (c).

Net revenue derived from a tax means the amount of revenue derived from a tax that is deposited into the Highway Users Tax Account in the Transportation Tax Fund.

(a) Notwithstanding Section 13340 of the Government Code, of the net revenues deposited to the credit of the Highway Users Tax Account that are derived from the increases in the rates of taxes that are imposed pursuant to subdivision (b) of Section 7360 and Section 7361.1 of the Revenue and Taxation Code, all of the following shall occur on a monthly basis:
  (1) (A) By the 15th day of every month, the Treasurer's office, in consultation with the Department of Finance, shall notify the Controller of the amount of debt service that will be paid on each transportation bond during that month.
  (B) Within two business days following the 28th day of each month, the Controller shall transfer to the Transportation Debt Service Fund an amount equal to the amount of monthly debt service paid by the General Fund on any bonds issued pursuant to the Seismic Retrofit Bond Act of 1996 (Chapter 12.48 (commencing with Section 8879) of Division 1 of Title 2 of the Government Code) or any other bonds issued for highway or eligible guideway projects consistent with the requirements applicable to the expenditure of revenues under Article XIX of the California Constitution as identified by the Department of Finance pursuant to Section 16965 of the Government Code, and three-quarters of the amount of monthly debt service paid on any bonds issued pursuant to the Highway Safety, Traffic Reduction, Air Quality, and Port Security Bond Act of 2006 (Chapter 12.49 (commencing with Section 8879.20) of Division 1 of Title 2) for reimbursement of the General Fund for these costs. If revenues available pursuant to this subdivision in any given month are insufficient to fully reimburse the General Fund for the debt service payments made, the first revenues available pursuant to this subdivision in the following month or months shall be transferred to the Transportation Debt Service Fund so that all debt service payments made on these bonds from the General Fund in a given fiscal year are fully reimbursed. However, no further transfers shall be made pursuant to this subparagraph once the transfers for the months of July to October, inclusive, in 2010 have been made. Any transfers made from the net revenues identified in this paragraph for highway and eligible guideway bond debt service for months after October 2010 shall be reversed and shall instead be made from weight fee revenues in the State Highway Account, as described in subparagraph (F).
  (C) Beginning November 2, 2010, the Controller shall transfer to the State Highway Account within two business days following the 28th day of each month all of the monthly net revenues identified in subparagraph (B) that were designated for highway and eligible guideway bond debt service reimbursement but that have not been transferred, or that were transferred by means of a transfer that was reversed, pursuant to that subparagraph. To the extent the Controller has distributed any of those net revenues to cities and counties pursuant to subparagraph (C) of paragraph (3) between November 2, 2010, and March 24, 2011, the Controller shall subsequently reduce the amount transferred to cities and counties on a monthly basis pursuant to subparagraph (C) of paragraph (3) and shall instead transfer these funds to the State Highway Account until all of the revenues that would otherwise have been transferred to the State Highway Account on and after November 2, 2010, pursuant to this subparagraph have been so transferred. For the 2011-12 fiscal year, the Controller shall transfer to the State Highway Account within two business days following the 28th day of each month an amount equal to the weight fee revenues transferred to the Transportation Debt Service Fund pursuant to subdivision (b) of Section 9400.4 of the Vehicle Code, including forty-three million seven hundred thousand dollars ($43,700,000) authorized pursuant to Item 2660-013-0042 of Section 2.00 of the Budget Act of 2011 and an amount equal to weight fee revenues transferred to the General Fund as a loan pursuant to subdivision (b) of Section 9400.4 of the Vehicle Code. To the extent the Controller has distributed any of those revenues to cities and counties pursuant to subparagraph (C) of paragraph (3), the Controller shall subsequently reduce the amount transferred to cities and counties on a monthly basis pursuant to subparagraph (C) of paragraph (3) and instead transfer these funds to the State Highway Account until all of the revenues that would otherwise have been transferred to the State Highway Account in the 2011-12 fiscal year pursuant to this subparagraph have been so transferred.
  (D) Notwithstanding subparagraph (C), commencing with the 2012-13 fiscal year and every fiscal year thereafter, the Controller shall transfer to the State Highway Account within two business days following the 28th day of each month an amount equal to the amount of weight fee revenues transferred to the Transportation Debt Service Fund for highway and eligible guideway bond debt service and to the General Fund as a loan pursuant to subdivision (c) of Section 9400.4 of the Vehicle Code.
  (E) Beginning July 1, 2011, transfers made under subparagraphs (C) and (D) during a fiscal year shall not exceed the annual revenue generated from weight fees, as determined by Sections 9400.4 and 42205 of the Vehicle Code, at the rates in effect as of March 24, 2011, as determined by the Department of Finance.
  (F) Any remaining amount of the highway or eligible guideway bond debt service reimbursement authorized by this paragraph that has not been made pursuant to subparagraph (B) on and after November 2, 2010, shall instead be made pursuant to subdivisions (a), (b), and (c) of Section 9400.4 of the Vehicle Code from revenues in the State Highway Account derived from weight fees deposited in the account pursuant to subdivision (e) of Section 9400.1 and Section 42205 of the Vehicle Code.
  (2) (A) In the 2010-11 fiscal year, after the monthly transfer made pursuant to paragraph (1), the sum of fifty-four million one hundred sixty-seven thousand dollars ($54,167,000) per month shall be held in the account for future appropriation by the Legislature.
  (B) Notwithstanding any other provision of law, with respect to the monthly net revenues described in subparagraph (A), no further transfers of these revenues for the purpose of loans to the General Fund shall be made pursuant to Item 2660-011-0062 of Section 2.00 of the Budget Act of 2010 once the loan transfers for the months of July to October, inclusive, in 2010 have been made. Notwithstanding the loan repayment date specified in the provisional language for that item, the funds loaned shall be repaid by June 30, 2021. Any transfers made from the monthly net revenues in subparagraph (A) for months after October 2010 shall be reversed and shall instead be made from weight fee revenues in the State Highway Account, as described in subparagraph (D). The revenues from loan repayments shall be held in the Highway Users Tax Account for future appropriation by the Legislature.
  (C) Beginning November 2, 2010, all of the monthly net revenues described in subparagraph (A) shall instead be transferred by the Controller to the State Highway Account within two business days following the 28th day of each month. To the extent that the Controller has distributed any of the revenues identified in this paragraph to cities and counties pursuant to subparagraph (C) of paragraph (3) between October 14, 2010, and March 24, 2011, the Controller shall subsequently reduce the amount transferred to cities and counties on a monthly basis pursuant to subparagraph (C) of paragraph (3) and shall instead transfer these funds to the State Highway Account until all of the revenues that would have been transferred to the General Fund as a loan pursuant to Item 2660-011-0062 of Section 2.00 of the Budget Act of 2010 on and after November 2, 2010, have instead been transferred to the State Highway Account.
  (D) Any remaining amount of the loans to the General Fund authorized pursuant to Item 2660-011-0062 of Section 2.00 of the Budget Act of 2010 that has not been made pursuant to subparagraph (B) on and after November 2, 2010, shall instead be made pursuant to subdivisions (a), (b), and (c) of Section 9400.4 of the Vehicle Code from revenues in the State Highway Account derived from weight fees deposited in the account pursuant to subdivision (e) of Section 9400.1 and Section 42205 of the Vehicle Code.
  (3) The Controller shall transfer any remaining net revenues subject to this subdivision as follows:
  (A) Forty-four percent shall be transferred to the State Highway Account to fund projects in the State Transportation Improvement Program that are consistent with Section 1 of Article XIX of the California Constitution, except in the 2010-11 fiscal year, 50 percent shall be transferred for purposes of this subparagraph.
  (B) Twelve percent shall be transferred to the State Highway Account to fund projects in the State Highway Operation and Protection Program, except in the 2010-11 fiscal year, no revenues shall be transferred for purposes of this subparagraph.
  (C) Forty-four percent shall be apportioned by the Controller for local street and road purposes, except in the 2010-11 fiscal year, 50 percent shall be transferred for purposes of this subparagraph as follows:
  (i) Fifty percent shall be apportioned by the Controller to cities, including a city and county, in the proportion that the total population of the city bears to the total population of all the cities in the state.
  (ii) Fifty percent shall be apportioned by the Controller to counties, including a city and county, in accordance with the following formulas:
  (I) Seventy-five percent shall be apportioned among the counties in the proportion that the number of fee-paid and exempt vehicles that are registered in the county bear to the number of fee-paid and exempt vehicles registered in the state.
  (II) Twenty-five percent shall be apportioned among the counties in the proportion that the number of miles of maintained county roads in each county bear to the total number of miles of maintained county roads in the state. For the purposes of apportioning funds under this subparagraph, any roads within the boundaries of a city and county that are not state highways shall be deemed to be county roads.
  (b) After the transfers or other actions pursuant to subdivision (a), at least 90 percent of the balance deposited to the credit of the Highway Users Tax Account in the Transportation Tax Fund by the 28th day of each month shall be apportioned or transferred, as applicable, by the Controller by the second working day thereafter, except for June, in which case the apportionment or transfer shall be made the same day. These apportionments or transfers shall be made as provided for in Sections 2104 to 2122, inclusive. If information is not available to make the apportionment or transfer as required, the apportionment or transfer shall be made on the basis of the information of the previous month. Amounts not apportioned or transferred shall be included in the apportionment or transfer of the subsequent month.
  (c) Notwithstanding any other law, the funds apportioned by the Controller to cities and counties pursuant to subparagraph (C) of paragraph (3) of subdivision (a) are not subject to Section 7104 or 7104.2 of the Revenue and Taxation Code. These funds may be expended for any street and road purpose consistent with the requirements of this chapter.

Notwithstanding Section 13340 of the Government Code, a sum equal to the net revenue derived from a per gallon tax of 2.035 cents ($0.02035) under the Motor Vehicle Fuel License Tax Law (Part 2 (commencing with Section 7301) of Division 2), 1.80 cents ($0.0180) under the Use Fuel Tax Law (Part 3 (commencing with Section 8601) of Division 2), and 1.80 cents ($0.0180) under the Diesel Fuel Tax Law (Part 31 (commencing with Section 60001) of Division 2) of the Revenue and Taxation Code, shall be apportioned among the counties, as follows:
  (a) Each county shall be paid one thousand six hundred sixty-seven dollars ($1,667) during each calendar month, which amount shall be expended exclusively for engineering costs and administrative expenses with respect to county roads.
  (b) A sum equal to the total of all reimbursable snow removal or snow grooming, or both, costs filed pursuant to subdivision (d) of Section 2152, or seven million dollars ($7,000,000), whichever is less, shall be apportioned in 12 approximately equal monthly apportionments for snow removal or snow grooming, or both, on county roads, as provided in Section 2110.
  (c) A sum equal to five hundred thousand dollars ($500,000) shall be apportioned in 12 approximately equal monthly apportionments, as provided in Section 2110.5.
  (d) (1) Seventy-five percent of the funds payable under this section shall be apportioned among the counties monthly in the respective proportions that the number of fee-paid and exempt vehicles which are registered in each county bears to the total number of fee-paid and exempt vehicles registered in the state.
  (2) For purposes of apportionment under this subdivision, the Department of Motor Vehicles shall, as soon as possible after the last day of each calendar month, furnish to the Controller a verified statement showing the number of fee-paid and exempt vehicles which are registered in each county and in the state as of the last day of each calendar month as reflected by the records of the Department of Motor Vehicles.
  (e) Of the remaining money payable, there shall be paid to each eligible county an amount that is computed monthly as follows: The number of miles of maintained county roads in each county shall be multiplied by sixty dollars ($60); from the resultant amount, there shall be deducted the amount received by each county under subdivision (d) and the remainder, if any, shall be paid to each county.
  (f) The remaining money payable, after the foregoing apportionments, shall be apportioned among the counties in the same proportion as the money referred to in subdivision (d).
  (g) (1) Transfers of revenues from the Highway Users Tax Account to counties pursuant to this section collected during the months of March, April, May, June, and July of 2008, shall be made with the transfer of August 2008 revenues in September of 2008. This suspension shall not apply to a county with a population of less than 40,000.
  (2) For the purpose of meeting the cash obligations associated with ongoing budgeted costs, a county may make use of any cash balance in its county road fund, including that resulting from the receipt of funds pursuant to the Highway Safety, Traffic Reduction, Air Quality, and Port Security Bond Act of 2006 (Chapter 12.49 (commencing with Section 8879.20) of Division 1 of Title 2 of the Government Code (hereafter bond act)) for local streets and roads maintenance, during the period of this suspension, without the use of this cash being reflected as an expenditure of bond act funds, provided the cash is replaced once this suspension is repaid in September of 2008. Counties may accrue the revenue received in September 2008 as repayment of these suspensions for the months of April, May, and June of 2008 back to the 2007-08 fiscal year. Nothing in this paragraph shall change the fact that expenditures must be accrued and reflected from the appropriate funding sources for which the moneys were received and meet all the requirements of those funding sources.
  (h) (1) The transfer of revenues from the Highway Users Tax Account to counties pursuant to this section that are collected during the months of January, February, and March 2009, shall be made with the transfer of April 2009 revenues in May 2009.
  (2) For the purpose of meeting the cash obligations associated with ongoing budgeted costs, a county may make use of any cash balance in its county road fund, including that resulting from the receipt of funds pursuant to the Highway Safety, Traffic Reduction, Air Quality, and Port Security Bond Act of 2006 (Chapter 12.49 (commencing with Section 8879.20) of Division 1 of Title 2 of the Government Code (bond act)) for local streets and roads maintenance during the period of this suspension, provided the cash is replaced once this suspension is repaid in May of 2009.
  (3) This subdivision shall not affect any requirement that an expenditure is required to be accrued and reflected from the appropriate funding source for which the money was received and to meet all the requirements of its funding source.

Notwithstanding Section 13340 of the Government Code, the Controller shall deduct annually, from the amount apportioned pursuant to Section 2104, the amount identified as applicable to counties in the report submitted in the preceding fiscal year pursuant to Section 191, and shall transfer the amount to the State Highway Account. The transferred amount shall be subject to appropriation pursuant to Section 183 for expenditure in accordance with Section 163.

Notwithstanding Section 13340 of the Government Code, in addition to the apportionments prescribed by Sections 2104, 2106, and 2107, from the revenues derived from a per gallon tax imposed pursuant to Section 7360 of the Revenue and Taxation Code, and a per gallon tax imposed pursuant to Section 8651 of the Revenue and Taxation Code, and a per gallon tax imposed pursuant to Sections 60050 and 60115 of the Revenue and Taxation Code, the following apportionments shall be made:
  (a) A sum equal to 1.035 cents ($0.01035) per gallon from the tax under Section 7360 of the Revenue and Taxation Code, 11.5 percent of any per gallon tax in excess of nine cents ($0.09) per gallon under Section 8651 of the Revenue and Taxation Code, and 1.035 cents ($0.01035) per gallon from the tax under Sections 60050 and 60115 of the Revenue and Taxation Code, shall be apportioned among the counties, including a city and county. The amount of apportionment to each county, including a city and county, during a fiscal year shall be calculated as follows:
  (1) One million dollars ($1,000,000) for apportionment to all counties, including a city and county, in proportion to each county's receipts during the prior fiscal year under Sections 2104 and 2106.
  (2) One million dollars ($1,000,000) for apportionment to all counties, including a city and county, as follows:
  (A) Seventy-five percent in the proportion that the number of fee-paid and exempt vehicles which are registered in the county bears to the number of fee-paid and exempt vehicles registered in the state.
  (B) Twenty-five percent in the proportion that the number of miles of maintained county roads in the county bears to the miles of maintained county roads in the state.
  (3) For each county, determine its factor which is the higher amount calculated pursuant to paragraph (1) or (2) divided by the sum of the higher amounts for all of the counties.
  (4) The amount to be apportioned to each county is equal to its factor multiplied by the amount available for apportionment.
  (b) A sum equal to 1.035 cents ($0.01035) per gallon from the tax under Section 7360 of the Revenue and Taxation Code, 11.5 percent of any per gallon tax in excess of nine cents ($0.09) per gallon under Section 8651 of the Revenue and Taxation Code, and 1.035 cents ($0.01035) per gallon from the tax under Sections 60050 and 60115 of the Revenue and Taxation Code, shall be apportioned to cities, including a city and county, in the proportion that the total population of the city bears to the total population of all the cities in the state.
  (c) (1) Transfers of revenues from the Highway Users Tax Account to counties or cities pursuant to this section collected during the months of March, April, May, June, and July of 2008, shall be made with the transfer of August 2008 revenues in September of 2008. This suspension shall not apply to a county with a population of less than 40,000.
  (2) For the purpose of meeting the cash obligations associated with ongoing budgeted costs, a city or county may make use of any cash balance in the city account that is designated for the receipt of state funds allocated for local streets and roads or the county road fund, including that resulting from the receipt of funds pursuant to the Highway Safety, Traffic Reduction, Air Quality, and Port Security Bond Act of 2006 (Chapter 12.49 (commencing with Section 8879.20) of Division 1 of Title 2 of the Government Code (hereafter bond act)) for local streets and roads maintenance, during the period of this suspension, without the use of this cash being reflected as an expenditure of bond act funds, provided the cash is replaced once this suspension is repaid in September of 2008. Counties and cities may accrue the revenue received in September 2008 as repayment of these suspensions for the months of April, May, and June of 2008 back to the 2007-08 fiscal year. Nothing in this paragraph shall change the fact that expenditures must be accrued and reflected from the appropriate funding sources for which the moneys were received and meet all the requirements of those funding sources.
  (d) (1) The transfer of revenues from the Highway Users Tax Account to counties or cities pursuant to this section collected during the months of January, February, and March 2009 shall be made with the transfer of April 2009 revenues in May 2009.
  (2) For the purpose of meeting the cash obligations associated with ongoing budgeted costs, a city or county may make use of any cash balance in the city account that is designated for the receipt of state funds allocated for local streets and roads or the county road fund, including that resulting from the receipt of funds pursuant to the Highway Safety, Traffic Reduction, Air Quality, and Port Security Bond Act of 2006 (Chapter 12.49 (commencing with Section 8879.20) of Division 1 of Title 2 of the Government Code (bond act)) for local streets and roads maintenance, during the period of this suspension, and the use of this cash shall not be considered as an expenditure of bond act funds, if the cash is replaced when the payments that are suspended pursuant to this subdivision are repaid in May 2009.
  (3) This subdivision shall not affect any requirement that an expenditure is required to be accrued and reflected from the appropriate funding source for which the money was received and to meet all the requirements of its funding source.

Notwithstanding Section 13340 of the Government Code, a sum equal to the net revenue derived from one and four one-hundredths cent ($0.0104) per gallon tax under the Motor Vehicle Fuel License Tax Law (Part 2 (commencing with Section 7301) of Division 2 of the Revenue and Taxation Code) shall be apportioned monthly from the Highway Users Tax Account in the Transportation Tax Fund among the counties and cities as follows:
  (a) Four hundred dollars ($400) per month shall be apportioned to each city and city and county and eight hundred dollars ($800) per month shall be apportioned to each county and city and county.
  (b) On the last day of each month, the sum of six hundred thousand dollars ($600,000) shall be transferred to the State Highway Account in the State Transportation Fund for the Active Transportation Program pursuant to Chapter 8 (commencing with Section 2380). For each month in the 2013-14 fiscal year that has passed prior to the enactment of the bill adding this sentence, six hundred thousand dollars ($600,000) shall be immediately transferred from the Bicycle Transportation Account to the State Highway Account in the State Transportation Fund for the Active Transportation Program, less any amount already expended for that program from the Bicycle Transportation Account during the 2013-14 fiscal year.
  (c) The balance shall be apportioned, as follows:
  (1) A base sum shall be computed for each county by using the same proportions of fee-paid and exempt vehicles as are established for purposes of apportionment of funds under subdivision (d) of Section 2104.
  (2) For each county, the percentage of the total assessed valuation of tangible property subject to local tax levies within the county which is represented by the assessed valuation of tangible property outside the incorporated cities of the county shall be applied to its base sum, and the resulting amount shall be apportioned to the county. The assessed valuation of taxable tangible property, for purposes of this computation, shall be that most recently used for countywide tax levies as reported to the Controller by the State Board of Equalization. If an incorporation or annexation is legally completed following the base sum computation, the new city's assessed valuation shall be deducted from the county's assessed valuation, the estimate of which may be provided by the State Board of Equalization.
  (3) The difference between the base sum for each county and the amount apportioned to the county shall be apportioned to the cities of that county in the proportion that the population of each city bears to the total population of all the cities in the county. Populations used for determining apportionment of money under Section 2107 are to be used for purposes of this section.
  (d) (1) Transfers of revenues from the Highway Users Tax Account to counties or cities pursuant to this section collected during the months of March, April, May, June, and July of 2008, shall be made with the transfer of August 2008 revenues in September of 2008. This suspension shall not apply to a county with a population of less than 40,000.
  (2) For the purpose of meeting the cash obligations associated with ongoing budgeted costs, a city or county may make use of any cash balance in the city account that is designated for the receipt of state funds allocated for local streets and roads or the county road fund, including that resulting from the receipt of funds pursuant to the Highway Safety, Traffic Reduction, Air Quality, and Port Security Bond Act of 2006 (Chapter 12.49 (commencing with Section 8879.20) of Division 1 of Title 2 of the Government Code (hereafter bond act)) for local streets and roads maintenance, during the period of this suspension, without the use of this cash being reflected as an expenditure of bond act funds, provided the cash is replaced once this suspension is repaid in September of 2008. Counties and cities may accrue the revenue received in September 2008 as repayment of these suspensions for the months of April, May, and June of 2008 back to the 2007-08 fiscal year. Nothing in this paragraph shall change the fact that expenditures must be accrued and reflected from the appropriate funding sources for which the moneys were received and meet all the requirements of those funding sources.
  (e) (1) The transfer of revenues from the Highway Users Tax Account to counties or cities pursuant to this section collected during the months of January, February, and March 2009, shall be made with the transfer of April 2009 revenues in May 2009.
  (2) For the purpose of meeting the cash obligations associated with ongoing budgeted costs, a city or county may make use of any cash balance in the city account that is designated for the receipt of state funds allocated for local streets and roads or the county road fund, including that resulting from the receipt of funds pursuant to the Highway Safety, Traffic Reduction, Air Quality, and Port Security Bond Act of 2006 (Chapter 12.49 (commencing with Section 8879.20) of Division 1 of Title 2 of the Government Code (bond act)) for local streets and roads maintenance, during the period of this suspension, and the use of this cash shall not be considered as an expenditure of bond act funds, if the cash is replaced when the payments that are suspended pursuant to this subdivision are repaid in May 2009.
  (3) This subdivision shall not affect any requirement that an expenditure is required to be accrued and reflected from the appropriate funding source for which the money was received and to meet all the requirements of its funding source.

If Los Angeles County elects to allocate any portion of the revenues it receives pursuant to Section 2104 or 2106 to the cities within the county under any program in which those revenues are allocated to at least 70 percent of the cities, it shall make allocations to each city within the county based on the two following equally weighted factors:
  (1) The population of the city to the total population of all the cities in the county.
  (2) The city street mileage to the total street mileage of all the cities in the county, as determined from the county master plan.

From funds apportioned to the County of Los Angeles pursuant to Sections 2104, 2105, and 2106, or from other transportation funds available to the county, or from any combination of those funds, as determined by the county, the county shall, beginning in the 1996-97 fiscal year, commence the annual transfer to the Los Angeles County Metropolitan Transportation Authority of funds in an amount calculated to amortize, in equal annual installments over a 5-year period, the amount by which fiscal realignment revenues deposited in the county general fund exceed fifty million dollars ($50,000,000). The highest priority for the use of the remaining funds apportioned to the county pursuant to this chapter shall be for safety and for maintenance of county facilities in urban areas with the highest backlog of maintenance and rehabilitation needs.

(a) Each county and any of its incorporated cities may enter into an agreement regarding the base sum established by paragraph (1) of subdivision (c) of Section 2106, providing for expenditure of the amounts apportioned to the county and apportioned for expenditure within the cities participating in the agreement upon road and streets within the county and the cities participating in the agreement.
  (b) Any of the incorporated cities within a county may enter into an agreement among themselves regarding the amount apportioned to them pursuant to paragraph (3) of subdivision (c) of Section 2106 for expenditure upon city streets within the cities participating in the agreement.
  (c) Any such agreement shall be filed with the State Controller. After verification of the agreement by the State Controller, the State Controller shall make disposition of the apportionments to the parties participating in the agreement in accordance with terms of the agreement.

The Sacramento County Board of Supervisors may allocate up to seven hundred thousand dollars ($700,000) from revenues apportioned to Sacramento County pursuant to Sections 2103, 2104, 2105, and 2106, or from other transportation funds available to the county, or from any combination of those funds, for the purpose of building a soundwall in and around the Walerga Park area adjacent to State Route 80 in Sacramento County.

(a) Notwithstanding Section 13340 of the Government Code, a sum equal to the net revenues derived from a per gallon tax of 1.315 cents ($0.01315) under the Motor Vehicle Fuel License Tax Law (Part 2 (commencing with Section 7301) of Division 2), 2.59 cents ($0.0259) under the Use Fuel Tax Law (Part 3 (commencing with Section 8601) of Division 2), and 1.80 cents ($0.0180) under the Diesel Fuel Tax Law (Part 31 (commencing with Section 60001) of Division 2) of the Revenue and Taxation Code, shall be apportioned monthly to the cities and cities and counties of this state from the Highway Users Tax Account in the Transportation Tax Fund as provided in this section.
  (b) From the sum determined pursuant to subdivision (a), the Controller shall allocate annually to each city that has filed a report containing the information prescribed by subdivision (c) of Section 2152, and that had expenditures in excess of five thousand dollars ($5,000) during the preceding fiscal year for snow removal, an amount equal to one-half of the amount of its expenditures for snow removal in excess of five thousand dollars ($5,000) during that fiscal year.
  (c) The balance of the sum determined pursuant to subdivision (a) from the Highway Users Tax Account shall be allocated to each city, including city and county, in the proportion that the total population of the city bears to the total population of all the cities in this state.
  (d) (1) For the purpose of this section, except as otherwise provided in paragraph (2), the population in each city is the population determined for that city in the manner specified in Section 11005.3 of the Revenue and Taxation Code.
  (2) Commencing with the ninth fiscal year of a city described in subdivision (a) of Section 11005.3 of the Revenue and Taxation Code, the sixth fiscal year of a city described in subdivision (b) of Section 11005.3 of the Revenue and Taxation Code, and the 61st month of the city described in subdivision (c) of Section 11005.3 of the Revenue and Taxation Code, the population in each city is the actual population of that city, as defined in subdivision (e) of Section 11005.3 of the Revenue and Taxation Code.
  (e) (1) Transfers of revenues from the Highway Users Tax Account to cities pursuant to this section collected during the months of March, April, May, June, and July of 2008, shall be made with the transfer of August 2008 revenues in September of 2008.
  (2) For the purpose of meeting the cash obligations associated with ongoing budgeted costs, a city may make use of any cash balance in the city account that is designated for the receipt of state funds allocated for local streets and roads, including that resulting from the receipt of funds pursuant to the Highway Safety, Traffic Reduction, Air Quality, and Port Security Bond Act of 2006 (Chapter 12.49 (commencing with Section 8879.20) of Division 1 of Title 2 of the Government Code (hereafter bond act)) for local streets and roads maintenance, during the period of this suspension, without the use of this cash being reflected as an expenditure of bond act funds, provided the cash is replaced once this suspension is repaid in September of 2008. Cities may accrue the revenue received in September 2008 as repayment of these suspensions for the months of April, May, and June of 2008 back to the 2007-08 fiscal year. Nothing in this paragraph shall change the fact that expenditures must be accrued and reflected from the appropriate funding sources for which the moneys were received and meet all the requirements of those funding sources.
  (f) (1) A transfer of revenues from the Highway Users Tax Account to cities pursuant to this section collected during the months of January, February, and March 2009, shall be made with the transfer of April 2009 revenues in May 2009.
  (2) For the purpose of meeting the cash obligations associated with ongoing budgeted costs, a city may make use of any cash balance in the city account that is designated for the receipt of state funds allocated for local streets and roads, including that resulting from the receipt of funds pursuant to the Highway Safety, Traffic Reduction, Air Quality, and Port Security Bond Act of 2006 (Chapter 12.49 (commencing with Section 8879.20) of Division 1 of Title 2 of the Government Code (bond act)) for local streets and roads maintenance, during the period of this suspension, and the use of this cash shall not be reflected as an expenditure of bond act funds, if the cash is replaced once this suspension is repaid in May 2009.
  (3) This subdivision shall not affect any requirement that an expenditure is required to be accrued and reflected from the appropriate funding sources for which the moneys were received and to meet all the requirements of those funding sources.

Any city or city and county may apply to the United States Bureau of Census to determine its population. Upon receipt from the bureau of its determination of population, the city or city and county may, at its option, file a certified copy of the determination with the Controller. All apportionments made under Section 2107 and all payments under Section 11005 of the Revenue and Taxation Code for any apportionment made beginning with the month following the filing of the determination shall be based upon the population so determined until such time as a subsequent determination is made by the bureau and a certified copy is filed by the city or city and county with the Controller or a certified copy of a subsequent estimate or census result validated by the Department of Finance is filed with the Controller as provided in Section 2107.2. For the purposes of this section, a written or telegraphic certification from the Director of the Census to the Controller of the determination of population may be accepted by the Controller in lieu of the filing by the city or city and county of the certified copy of the determination. The cost of any determination by the United States Bureau of Census or by the Department of Finance is a proper charge against the city or city and county applying therefor and shall be paid by it to the bureau or to the department. This section does not apply to counties.

Any city or city and county may apply to the population research unit of the Department of Finance to estimate its population or the population of any inhabited territory annexed to the city subsequent to the last federal or state census validated by the population research unit of the Department of Finance. The department may make the estimate if in the opinion of the department there is available adequate information upon which to base the estimate. The department may develop or contract for the development of additional information if, in the opinion of the department, additional information may make an estimate feasible. Not less than 25 days nor more than 30 days after the completion of the estimate, the Department of Finance shall file a certified copy thereof with the Controller if the estimate is greater than the current certified population. All apportionments under Section 2107 and all payments under Section 11005 of the Revenue and Taxation Code for any apportionment made beginning with the month following the filing of the estimate shall be based upon the population so estimated until a subsequent estimate is made by the department and a certified copy is filed with the Controller or a subsequent determination is made by the United States Bureau of the Census and a certified copy is filed by the city or city and county with the Controller as provided in Section 2107.1. The Department of Finance may assess a reasonable charge, not to exceed the actual cost thereof, for the preparation of population estimates pursuant to this section, which is a proper charge against the city or city and county applying therefor. The amount received shall be deposited in the State Treasury as a reimbursement to be credited to the appropriation from which the expenditure is made. No more than one estimate of its total population shall be filed each fiscal year for each city or city and county. As of May 1, 1988, any population estimate prepared by the Department of Finance pursuant to Section 2227 of the Revenue and Taxation Code may be used for all purposes of this section unless a written request not to certify is received by the department from the city or city and county within 25 days of completion of the estimate.

The incorporation of a new city, or any annexation or exclusion of territory to or from an existing city, shall be considered for the purpose of apportionment of funds pursuant to Section 2107. The revenue shall be apportioned among the cities monthly as revenues are received in the Highway Users Tax Fund. Any newly incorporated city or any increase in population due to annexation shall be included in the monthly apportionment following such incorporation or annexation. In the event of the disincorporation of a city, or in the event the incorporation of a city is adjudged invalid, any funds apportioned pursuant to Section 2107 to such city, but which are unexpended, shall revert to the Highway Users Tax Fund and shall be reapportioned to all other cities and cities and counties pursuant to Section 2107. The Controller shall not be required to reapportion funds previously apportioned for expenditure in the different cities of the state by reason of any subsequent incorporation, invalidation of incorporation, annexation or exclusion of territory.

Not more than one-quarter of the funds allocated to a city or county from the Highway Users Tax Account in the Transportation Tax Fund for the construction of streets therein may be used to make principal and interest payments on bonds issued for such construction, if the issuance of such bonds is authorized by a proposition approved by a majority of the votes cast thereon. The term of any such bonds shall not exceed 25 years.

Notwithstanding Section 13340 of the Government Code, in addition to the amounts apportioned to cities from the Highway Users Tax Fund under Sections 2106 and 2107, the following amounts shall be allocated annually during the month of July of each fiscal year for expenditure exclusively for engineering costs and administrative expenses in respect to city streets:

(a) For each city with a population of over 500,000 inhabitants ................... $20,000
  (b) For each city with a population of 100,000 to 500,000 inhabitants ........... 10,000
  (c) For each city with a population of 50,000 to 99,999 inhabitants ................... 7,500
  (d) For each city with a population of 25,000 to 49,999 inhabitants ................... 6,000
  (e) For each city with a population of 20,000 to 24,999 inhabitants ................... 5,000
  (f) For each city with a population of 15,000 to 19,999 inhabitants ................... 4,000
  (g) For each city with a population of 10,000 to 14,999 inhabitants ................... 3,000
  (h) For each city with a population of 5,000 to 9,999 inhabitants ................... 2,000
  (i) For each city with a population of less than 5,000 inhabitants ................... 1,000

For the purpose of this section the population in each city shall be determined in accordance with Sections 2107, 2107.1, and 2107.2 at the time of allocation. Any city incorporated after the first day of July of any year shall receive the full annual allocation prescribed in this section, such allocation to be made during the month succeeding the filing or certification of the incorporation by the Secretary of State. Any city under subdivision (h) or (i) above may expend the moneys allocated to it hereunder for acquisition of rights-of-way for and construction of its street system. Transfers of revenues from the Highway Users Tax Account to cities pursuant to this section that are to be allocated during the month of July 2008, shall be made in September of 2008. For the purpose of meeting the cash obligations associated with ongoing budgeted costs, a city may make use of any cash balance in the city account that is designated for the receipt of state funds allocated for local streets and roads, including that resulting from the receipt of funds pursuant to the Highway Safety, Traffic Reduction, Air Quality, and Port Security Bond Act of 2006 (Chapter 12.49 (commencing with Section 8879.20) of Division 1 of Title 2 of the Government Code (hereafter bond act)) for local streets and roads maintenance, during the period of this suspension, without the use of this cash being reflected as an expenditure of bond act funds, provided the cash is replaced once this suspension is repaid in September of 2008. Nothing in this paragraph shall change the fact that expenditures must be accrued and reflected from the appropriate funding sources for which the moneys were received and meet all the requirements of those funding sources.

Notwithstanding Section 13340 of the Government Code, the Controller shall deduct annually, from the amount apportioned pursuant to Section 2107, the amount identified as applicable to cities in the report submitted in the preceding fiscal year pursuant to Section 191, and shall transfer the amount to the State Highway Account. The transferred amount shall be subject to appropriation pursuant to Section 183 for expenditure in accordance with Section 163.

(a) For each fiscal year, there shall be included in the annual Budget Bill submitted by the Governor an amount not to exceed three million four hundred thousand dollars ($3,400,000) to be appropriated by the Legislature from the Highway Users Tax Account in the Transportation Tax Fund to the State Parks and Recreation Fund.
  (b) These funds shall be appropriated to the Department of Parks and Recreation for the maintenance and repair of highways in units of the state park system.
  (c) In addition, the money may be used by the Department of Parks and Recreation for construction and improvement on the highways when appropriated for such purposes by the Legislature.
  (d) The highway construction and improvement shall be designed in accordance with the standards established by the Department of Parks and Recreation for state park roads, and may be carried out through service agreements with the Department of Transportation.
  (e) Any increase in the amount of this appropriation shall be considered in the course of the annual budget process, which shall include review and comment by the Department of Transportation.
  (f) For purposes of this section, highways in units of the state park system shall include those routes of motor vehicle travel generally open to public travel and service roads, parking areas, and roads within campgrounds. Nothing in this section shall constitute the highway as a state highway or add it to the state highway system.

The Legislature finds and declares that it intends counties and cities to use the additional funds provided them by the act enacting this section during the 1980-81 Regular Session of the Legislature to supplement existing local revenues being used for transportation purposes. Counties and cities are further encouraged to maintain their existing commitment of local funds for transportation purposes.

If the board of supervisors of a county with a population of more than 6,000,000 did not adopt and submit a resolution pursuant to Section 41 of the act enacting this section during the 1981-82 Regular Session of the Legislature, the increase in allocation for the county as a result of Section 2104, as amended and added by that act, shall instead be allocated to those cities in that county that adopted and submitted resolutions pursuant to Section 41. The allocation shall be on the basis of the population used for purposes of Section 2107.

Notwithstanding Section 13340 of the Government Code, the balance of the money in the Highway Users Tax Account in the Transportation Tax Fund, after making the apportionments or appropriations, as the case may be, pursuant to Sections 2104 to 2107.7, inclusive, shall be transferred to the State Highway Account in the State Transportation Fund and shall be subject to appropriation pursuant to Section 183 for expenditure in accordance with Section 163.

By July 1, 1990, the City, County, State Cooperation Committee in the deparment shall develop and adopt a pavement management program to be utilized on local streets or highways that receive funding under the state transportation improvement program. The pavement management program shall be transmitted to every county and city for possible adoption or incorporation into an existing pavement management program. The City, County, State Cooperation Committee shall solicit recommendations from transportation planning agencies and any other entity the committee deems appropriate.

State highways shall be maintained, constructed, and improved out of the moneys received in the State Highway Account under Section 2108. Notwithstanding Section 81, the department is not required to maintain any route, or portion of a route, added after January 1, 1947, until it has been laid out and constructed as a state highway.

(a) Notwithstanding Section 13340 of the Government Code, the moneys payable to the counties under subdivision (b) of Section 2104 shall be apportioned monthly among the several counties as follows:
  (1) A sum equal to the total of all reimbursable snow removal costs filed pursuant to subdivision (d) of Section 2152, or seven million dollars ($7,000,000), whichever is less, shall be apportioned in 12 approximately equal monthly apportionments for snow removal or snow grooming, or both, on county roads as follows:
  (2) If the total is less than seven million dollars ($7,000,000), the full amount of reimbursable snow removal or snow grooming, or both, costs shall be apportioned to the several counties in an amount equal to that computed pursuant to the report filed by each county pursuant to subdivision (d) of Section 2152.
  (3) If the total is seven million dollars ($7,000,000) or more for the fiscal year, the Controller shall compute percentages for the apportionment of seven million dollars ($7,000,000) to the several counties in the state for snow removal or snow grooming, or both, on county roads, including the purchase of snow removal equipment therefor, and shall apportion the amount to the counties in the computed percentages. The percentage each county is to be apportioned during the fiscal year shall be derived by adding its reimbursable snow removal or snow grooming, or both, expenditures for the three preceding fiscal years as to which the Controller has received snow removal or snow grooming, or both, expenditure reports pursuant to Section 2152, and dividing the sum by the total amount of reimbursable snow removal or snow grooming, or both, expenditures by all counties in the state during those fiscal years.
  (b) On or before the first day of March of each year, the Controller shall notify each county of the amount apportioned to it pursuant to this section for expenditure for snow removal or snow grooming, or both, on county roads during the following fiscal year.

Notwithstanding Section 13340 of the Government Code, the money payable to the counties under subdivision (c) of Section 2104 shall be apportioned monthly for heavy rainfall and storm damage on county roads to the following counties in the named percentages:

Alameda .............................. 2.629 Amador ............................... .135 Butte ................................ .161 Colusa ............................... .339 Contra Costa ......................... 10.575 Del Norte ............................ .251 Fresno ............................... .639 Humboldt ............................. 4.935 Los Angeles .......................... 9.913 Marin ................................ 3.781 Mendocino ............................ 2.084 Monterey ............................. 3.701 Napa ................................. 1.950 Nevada ............................... .718 Orange ............................... .051 Placer ............................... .085 Plumas ............................... .897 Riverside ............................ 1.185 San Benito ........................... 1.070 San Bernardino ....................... 2.609 San Francisco ........................ 1.016 San Diego ............................ 2.760 San Luis Obispo ...................... 5.782 Santa Barbara ........................ 7.661 Santa Cruz ........................... 12.162 Sierra ............................... .333 Siskiyou ............................. .814 Sonoma ............................... 10.238 Trinity .............................. 2.137 Ventura .............................. 8.543 Yuba ................................. .846

Apportionments from the Highway Users Tax Fund shall not be made to any incorporated city the streets of which are not public streets or which has not held an election of municipal officers within a period of 10 years preceding the date of such apportionment. Apportionments heretofore accumulated for expenditure within any such city shall be reapportioned to all other cities and cities and counties in the manner provided by Sections 2106 and 2107, respectively.

No money apportioned from the Highway Users Tax Fund as provided in Section 2106 or 2107 shall be used for the construction or improvement of any highway or street if the contract for such construction or improvement specifies the use of any patented or proprietary paving material, unless the contract has been awarded to the lowest responsible bidder therefor after alternate bids have been called for and opportunity afforded for bids to be submitted for nonpatented or nonproprietary paving material in competition with an equal thickness and like design of such patented or proprietary paving material. This section shall not be deemed nor construed to prohibit the use of any patented or proprietary paving material in the maintenance of any highway or street when such highway or street was constructed of such material and, in the opinion of the body, board or officer ordering such maintenance, it would be impractical to use a different paving material for such maintenance.

No apportionment of money from the Highway Users Tax Fund as provided in Section 2106 or 2107 shall be made to a city unless the city has set up by ordinance a "special gas tax street improvement fund." All apportionments of such moneys shall be deposited in the "special gas tax street improvement fund." In making any expenditure a city shall follow the law governing it in regard to the doing of the particular type of work in cases which are not exclusively municipal affairs. No state officer or employee shall be liable for anything done, or omitted to be done, by any city in the performance of any work. Interest received by a city from the investment of money in its special gas tax street improvement fund shall be deposited in the fund and shall be used for street purposes.

Any city may have any or all of its engineering and administrative work with respect to city streets done by contract. If authorized by their legislative bodies, two or more cities, by agreement, may jointly exercise the power granted by this section pursuant to the provisions of Sections 6500-6513, inclusive, of the Government Code.

Contracts for any construction and improvement projects on city streets for which funds apportioned from the Highway Users Tax Fund as provided in Section 2106 or 2107 may be expended during any fiscal year may be awarded on and after the first day of January preceding the beginning of the fiscal year.

In the event that any sums are taken or borrowed from the Highway Users Tax Fund, to augment the General Fund, or to pay any appropriations made from the General Fund, the Controller is authorized to reduce the amounts paid from such reduced fund proportionately to the reduction in such fund, such reductions to be made up when and if such reduced fund is reimbursed from the General Fund.

To permit the accomplishment of major cooperative street or highway projects in their entirety, the legislative body of a county or city may authorize the Controller to accumulate moneys accruing to the county or city over a period of time from the Highway Users Tax Fund pursuant to Section 2106 or 2107.

Any city may contract with the department for the performance by the department of any or all street work in such city and for such purpose may transfer to the department, for deposit in the State Treasury, any moneys available for expenditure by such city for street purposes.

(a) Whenever a school district constructs a school building for which any apportionment is made pursuant to Chapter 4 (commencing with Section 15700) or Chapter 6 (commencing with Section 16000) of Part 10 of the Education Code, and the city or county in which the school building is situated requires the construction of any street or road connected with the school premises on which the school building is constructed, the State Allocation Board shall review the requirement and recommend to the governing body of the city or county a plan of construction adequate to meet the needs of the school district and the safety of the public. If a different plan of improvement or improvement to higher standards than that recommended by the State Allocation Board is required by the governing body of the city or county, the additional cost thereof shall be borne by the city or county in which the school building is situated. Notwithstanding any other provision of this code or any other law limiting the purposes for which money apportioned to cities or counties from the Highway Users Tax Account in the Transportation Tax Fund may be expended, any of the moneys so apportioned may be expended for the construction of the streets or roads referred to in this section.
  (b) Nothing in this section requires each cost item included in any charge made pursuant to this section to be separately stated.

When the State Controller determines it to be necessary, he may require a county or city to deposit money received from the Highway Users Tax Fund in a separate bank account.

All or a portion of the cost of furnishing warranted traffic control personnel whose function is to assist students in crossing streets and highways and avoiding traffic hazards may be charged against money apportioned to cities, cities and counties, or counties from the Highway Users Tax Account in the Transportation Tax Fund. The amount charged shall not exceed the portion of money derived from the tax under the Motor Vehicle Account in the State Transportation Fund. The department may assist local agencies in establishing warrants for crossing guard protection.

The State Controller shall not draw his warrant upon the Highway Users Tax Fund in favor of any county or city which has failed to establish any road or street fund as required by law, which has failed to deposit money received from the Highway Users Tax Fund in a separate bank account when required under Section 2118, which has failed, neglected or refused to file any report required by law, showing the amount of money received by such county or city from the Highway Users Tax Fund and the disposition thereof, or which has failed, neglected, or refused to restore any such moneys not expended in conformance with any law or constitutional provision. On satisfactory proof by such county or city to the State Controller of the establishment of such road or street fund, the depositing of money in a separate bank account, the filing of such report, or the restoration of the improperly expended moneys, such warrant shall be issued. A county or city shall have a reasonable time, after notification from the State Controller, to comply with the provisions of this section.

Upon the request of the board of supervisors of any county, the Controller may deduct from the apportionment to such county any amount specified in such request and pay the amount to any state department for services to be furnished in accordance with the request.

(a) In May of each year each county shall submit to the department any additions or exclusions from its mileage of maintained county highways, specifying the termini and mileage of each route added or excluded from its county maintained roads. The department shall either approve or disapprove each inclusion or exclusion. A county may appeal any disapproval as provided in Section 74. The department shall certify county mileage figures to the Controller, as required. No appeal shall affect any apportionment made by the Controller pending the determination of the appeal. If, on appeal, additional mileage is allowed the county, the department shall immediately certify the corrected figure to the Controller, and the same shall be used for subsequent apportionments.
  (b) Upon relinquishing any state highway or portion thereof to a county, the department shall immediately certify to the Controller the mileage so relinquished and the same shall immediately be added to the county's maintained mileage of county roads for purposes of subsequent apportionments.

Contracts for any construction and improvement projects on county highways for which it is anticipated funds from the Highway Users Tax Fund will be available during any fiscal year may be awarded on and after the first day of March preceding the beginning of the fiscal year.

(a) The money appropriated pursuant to Item 9675-101-890 of the Budget Act of 1985 (Chapter 111 of the Statutes of 1985) is hereby appropriated to the Controller for allocation to counties and cities for street and highway maintenance and reconstruction, 55 percent to the cities for allocation pursuant to subdivision (b) and 45 percent to the counties for allocation pursuant to subdivision (c).
  (b) (1) The amount to be allocated to a city, including a city and county, equals the amount available for allocation to the cities pursuant to subdivision (a) times the ratio of the total allocation it received pursuant to Section 2107 over all allocations made pursuant to that section during the prior fiscal year.
  (2) In the case of a city whose incorporation was effective between July 1, 1984, and October 2, 1986, inclusive, and which did not receive the equivalent of a full year allocation of funds appropriated for allocation pursuant to subdivision (a) of Section 7 of Chapter 1600 of the Statutes of 1985 or pursuant to subdivision (a) of this section, the amount calculated for allocation pursuant to subdivision (b) of that Section 7 shall be increased by an amount which will provide the city an amount equivalent to the total allocation it would have received pursuant to subdivisions (a) and (b) of that Section 7 and subdivision (a) of this section.
  (c) Fifty-five percent of the funds payable under this section to counties, including a city and county, shall be apportioned among the counties in the proportion that the number of fee-paid and exempt vehicles registered in each county bears to the total number of fee-paid and exempt vehicles which are registered in the state. Forty-five percent of the funds payable under this section to counties, including a city and county, shall be apportioned among the counties in the proportion that the number of miles of maintained county roads in each county bears to the total number of miles of maintained county roads in the state.
  (d) For purposes of this section:
  (1) "Maintenance" means (A) patching and (B) overlay and sealing.
  (2) "Reconstruction" does not include widening to increase the traffic capacity of a street or highway, but does include any widening of the roadway if the widening is necessary to bring the roadway width to the desirable minimum width consistent with the geometric design criteria of the department for nonfreeway 3R (reconstruction, resurfacing, and rehabilitation) projects.
  (e) The Controller shall allocate the funds available for that Item 9675-101-890 within 30 days after they become available to the state.

(a) (1) Except in the case of a city or county which has made an election pursuant to paragraph (2) or (3) of this subdivision, in order to receive any allocation pursuant to Section 2126 or Section 7 of Chapter 1600 of the Statutes of 1985, the city or county, as the case may be, shall expend for the maintenance and reconstruction, as defined in subdivision (d) of Section 2126, of its local street and highway system during the fiscal year that it receives an allocation pursuant to Section 2126 or that Section 7 not less than its base year expenditure, excluding the allocation received pursuant to Section 2126 or that Section 7, or both, during the fiscal year.
  (2) A city or county may elect to expend during the two fiscal years that it receives an allocation, a total amount which is not less than twice the amount of its base year expenditure.
  (3) A city may elect to expend, during the two fiscal years that it receives an allocation and the following fiscal year, a total amount which is not less than three times the amount of its base year expenditure. This paragraph applies only to the Cities of Bakersfield, El Segundo, Novato, Oceanside, San Mateo, San Rafael, Santa Maria, Seal Beach, and Westminster. For the purposes of this paragraph, either actual expenditures or funds encumbered by contractual obligations in the 1987-88 fiscal year shall qualify as expenditures in the year after allocations are received.
  (4) Any city, except the Cities of Bakersfield, El Segundo, Novato, San Rafael, and Santa Maria, or county making an election pursuant to paragraph (2) or (3) shall so notify the Controller by December 31, 1987, and a city or county which fails to do so shall be governed by paragraph (1).
  (5) Any city or county with a population of 40,000 or less which makes an election pursuant to paragraph (2) or (3) and which expends funds pursuant to that election by October 30, 1988, shall be deemed to have notified the Controller pursuant to paragraph (4).
  (6) This subdivision does not apply to a city or a county, including a city which filed a notice with the Controller pursuant to subdivision (g), with a population of 10,000 or less, as most recently determined by the Department of Finance.
  (b) The amount allocated to a city or a county, as the case may be, shall be expended by October 30, 1988.
  (c) (1) For purposes of this section, "base year expenditure" means the amount that the city or county, as the case may be, expended for patching, overlay, and sealing, and reconstruction of its local street and highway system during the 1984-85 fiscal year, as reported to the Controller pursuant to Section 2151. Any city or county, with a population of 100,000 or less as of October 1, 1986, which filed a notice with the Controller pursuant to subdivision (g), may elect to have its "base year expenditure" determined on the basis of its 1983-84 fiscal year expenditures. A city or county making this election shall so notify the Controller by December 31, 1987, and the election shall not be available to a city or county which does not so notify the Controller.
  (2) If the sum of the revenue received by a city or county during the fiscal year pursuant to Section 500 of Title 16, Section 104(b) (2) and (6) and Sections 125 and 144 of Title 23, and Chapter 68 (commencing with Section 5121) of Title 42 of the United States Code, and from the federal Community Block Grant Program, the federal Revenue Sharing Program, and transit assistance funds from the Transportation Planning and Development Account, which was expended for the maintenance and reconstruction of its local street and highway system during the 1984-85 fiscal year, as reported to the Controller pursuant to Section 2151, is more than the sum of funds it received from those sources during any fiscal year, the base year expenditure of the city or county, as the case may be, for the fiscal year shall be reduced by the difference between the sums. For purposes of this paragraph, "revenue received" means that percentage of the project expenditures or the maximum reimbursable amount of eligible project costs as agreed upon by the federal government and the local agency for those projects eligible under this paragraph.
  (d) For each fiscal year during which an allocation was made pursuant to Section 2126 or Section 7 of Chapter 1600 of the Statutes of 1985, or both, the Controller shall audit the amount each county and city expended for the maintenance and reconstruction, as defined in subdivision (d) of Section 2126, of its local street and highway system during the fiscal year. For amounts allocated to counties and cities for expenditure by October 30, 1988, the audit shall be completed by October 30, 1990.
  (e) (1) If the Controller determines pursuant to subdivision (d) that a county or city, for the fiscal year, expended for the maintenance and reconstruction of its local street and highway system less than the required amount determined pursuant to subdivision (a) or (b), its allocation pursuant to Section 2104 or 2107, as the case may be, shall be reduced during the next fiscal year by the amount that its expenditure is less than the required amount, but the amount of the reduction shall not exceed the amount allocated to the city or county in each fiscal year that the city or county received funds pursuant to Section 2126 or Section 7 of Chapter 1600 of the Statutes of 1985.
  (2) Paragraph (1) does not apply to a city or county during the fiscal year in which it returns to the Controller the allocation it received pursuant to Section 2126 or that Section 7, or both. The city or county shall return the allocation plus any accrued interest within 30 days after receipt of the allocation.
  (f) Any funds withheld or returned as a result of subdivision (e) shall be reallocated to the other counties and cities whose expenditure is not less than its required amount pursuant to subdivision (b) or (c) of Section 2126, as the case may be.
  (g) In the case of a city or county which on or before October 1, 1986, files with the Controller a written notice declaring the inability of the city or county to comply with the matching requirement of subdivision (a), the Controller shall postpone the penalty provisions of paragraph (1) of subdivision (e) and shall not reallocate the funds, as provided for by subdivision (f), until September 1, 1987. The notice to the Controller shall contain all of the following:
  (1) The amount of 1984-85 base year matching requirements as determined by the Controller's audit.
  (2) The amount the local entity will fall short of the base year matching requirement.
  (3) The reasons why the city or county is unable to meet the base year matching requirement.
  (4) The amounts expended by the local entity on patching, overlay, sealing, and reconstruction of its street and highway system in fiscal years 1981-82, 1982-83, and 1983-84. The Controller shall, by November 1, 1986, transmit to the Chairpersons of the Senate and Assembly Transportation Committees and the Joint Legislative Budget Committee the information submitted by counties and cities in the written notices provided for in this subdivision.