Similar to the 1990s, the budget proposes to shift $1.3 billion of property taxes from local governments to K-14 districts and reduce state education spending by an equal amount. In our view, the Legislature should use its authority over this tax for the overall betterment of local government, not as a state rainy day fund. Accordingly, we recommend the Legislature reject this proposal. If the Legislature chooses to review proposals to reduce local taxes, we offer guidelines for this process and outline an alternative budget reduction consistent with these guidelines. While this alternative also represents an undesirable intrusion into local finance, it would have fewer negative effects.