Article Source: County of San Mateo - CA
San Mateo County Leaders Urge State to Provide $157 Million in Funding Owed to 21 Peninsula Communities
April 7, 2026
Over 250 county leaders including elected officials and representatives
from public safety, health, education, labor, housing, nonprofits, and
more rallied at the Redwood City Fire Department Headquarters, warning
that more than $1 billion will be withheld over the next decade if
Sacramento fails to act now to fix a broken State funding mechanism.
REDWOOD CITY, CA – April 7, 2026 – In a powerful and unified call to
action this morning, San Mateo County leaders gathered at Downtown
Redwood City Fire Station 9 to appeal for inclusion in the State budget
of in-lieu Vehicle License Fee (VLF)
revenue that is legally owed to San Mateo County and its cities, and
for enactment of a permanent fix to a broken State payment mechanism
that is leaving the County uniquely and unfairly shortchanged without
State action.
With urgency mounting and stakes escalating, leaders made clear: the clock is ticking.
President of the San Mateo County Board of Supervisors Noelia Corzo
stated the County's position plainly: "Today our message to Governor
Newsom and state leaders is clear: we need two things to correct this
inequity – full payment of the outstanding amount owed, and a permanent
legislative fix so this never happens again. This is not about asking
for more. It is about receiving what the County and our 20 cities are
legally entitled to, which amounts to over $157 million right now, and
more than $1 billion over the next decade if this is not resolved."
Board of Supervisors President Noelia Corzo warned the shortfall could
exceed $1 billion over the next decade if the issue is unresolved.
At the heart of the issue is a stark inequity: while 55 California
counties receive their full VLF funding, San Mateo County is one of
just three counties statewide being shortchanged by an outdated State
payment mechanism, unless the State takes action. The problem traces
back to a 2004 State budget deal, when local governments accepted a
permanently reduced VLF rate and contributed additional local funding
to help balance the State budget, in exchange for reliable State
replacement revenue.
That promise has not been kept.
Through no fault of their own, San Mateo County and its cities have
been singled out and denied the full payments – an outcome that will
persist unless the state acts.In a positive signal, yesterday (Monday,
April 6) the Governor directed the Department of Finance to work with
the County on a solution.
California State Assembly Member Diane Papan, who was unable to attend
today’s press conference but has been a leading voice among the State
delegation fighting for an equitable solution, sent a stark warning:
"With federal reductions looming, the burden on the State to ensure
this critical funding is magnified. Failure to solve this will
undermine San Mateo County's demonstrated leadership in expanding
behavioral health and housing services and would jeopardize continued
progress in these State priority areas."
Speakers representing all sectors across the Peninsula delivered a
unified and urgent message: failure to restore these funds will trigger
immediate and devastating consequences for essential services across
the Peninsula.
Eight shelters housing nearly 3,000 people could be forced to close.
More than 5,500 families and seniors at risk of eviction would lose
rental assistance. Early literacy programs serving roughly 7,400
children would face cuts. Psychiatric services for hundreds of unhoused
residents would end.
Supervisor Jackie Speier said the funding gap will have real impacts on residents.
San Mateo County Supervisor Jackie Speier cut to the heart of the
matter: "This is not simply a line item on a spreadsheet. It’s a fire
engine unable to get there quickly enough when you’re having a heart
attack. It’s the difference between shelter beds being available
or not for someone unhoused. It’s city police arriving late for a call.
It’s a city park not getting equipment fixed. It’s a child losing an
after-school program at a local library. It’s a family losing rental
assistance. It’s potholes taking longer to be filled. Let me be
clear: it’s creating a diminishing quality of life.”
Today, Senator Josh Becker (D-Menlo Park) issued the following
statement on his continued efforts to create a permanent solution for
the Vehicle Licensing Fee’s (VLF) negative impact on the County of San
Mateo: “VLF revenues support essential local services that residents
and businesses rely on every day. Yet San Mateo County is one of only
three counties that is being treated unfairly due to a flawed
California funding formula created to address a state budget deficit
long ago. Every year, the county is forced to fight for funding that
supports critical, frontline services that have already been promised
to us. This isn’t just a technical issue; it’s a matter of fairness. I
will fight for every dollar our county is owed and push for a permanent
fix so we can finally end this cycle of uncertainty.”
Speakers also underscored a hard truth: the consequences of inaction will fall hardest on those least able to absorb them.
U.S. Rep. Kevin Mullin speaks in support of restoring state funding for San Mateo County.
Laura Bent, CEO of Samaritan House, one of the county's largest social
service providers, illustrated what’s at stake: "Tens of millions of
dollars in critical support will be lost for the people who need it
most. These services are not 'nice to haves'; they save lives every day
and ensure that the most vulnerable people in our communities are
treated with dignity and given a chance to get back on their feet."
Public safety leaders warned that no community will be spared.
Central County Fire Chief Dave Pucci cautioned that "countywide,
emergency response times will get longer, there will be fewer
firefighters, fewer fire engines in our fleets, and it will be harder
to maintain the vehicles, stations, and equipment we have".
Despite sending billions in tax revenues to Sacramento each year, San
Mateo County is being denied funding it is legally owed, an inequity
that stands in sharp contrast to how nearly every other county in
California is treated.
Today’s rally demonstrated overwhelming unity and resolve. All 20
cities in San Mateo County, alongside Mono and Alpine counties, have
joined the County in legal action against the State to recover these
funds. At the same time, the County has launched SMCFairFunding.org to
inform the public and to lay out the facts regarding the in-lieu VLF
funding San Mateo County and its cities are rightfully owed.
The State Assembly Budget Subcommittee will hear the County’s request
for inclusion of VLF funding in the State Budget on Tuesday April 21st.
The Governor has until late June to finalize the State budget.
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