Hold on Roseville, this next year may be a bumpy ride.

On Wednesday, state lawmakers officially came to an agreement for California’s 2009-2010 budget, which calls on local governments to close the state’s $26 billion deficit.

The budget deal includes plans to borrow redevelopment funds, gas tax and affordable housing funding from cities and counties statewide, an act that can dramatically impact the local community said Roseville Government Relations Manager Ellen Powell.

The state budget calls on cities to forfeit almost $2 billion over the course of two years in a highway user’s tax account, more commonly known as gas tax, that are typically used to improve and maintain local roadways.

“Our neighborhoods and homeowners will feel the brunt of that because that tax is the only funding source to repair their streets and roadways,” said Roseville Engineering Manager Rhon Herndon.

Each year Roseville uses gas tax funds to resurface, repair and maintain streets adjacent to more than 2,000 homes. If the state calls on those funds, $1.8 million annually, not only will it result in a degradation of neighborhood streets, Herndon said it would also mean a loss in contracted construction jobs.

The budget could also cost residents several highly anticipated infrastructure projects if Roseville is asked to forfeit $828,000, about 40 percent of the city’s discretionary funds, to the state for two years.

“This is a drastic hit because every $1 of redevelopment funds leverages about $14 in private investments,” Powell said. “That will cost Roseville about $11.5 million.”

Projects such as the Old Town parking structure, creek walk, outdoor amphitheater and future park improvements would be delayed and result in the loss of 60 construction jobs.

The budget deal calls on Roseville to transfer more than $1.1 million low and moderate-income housing funds and $828,000 of redevelopment agency funding to the state.

“This is going to affect our ability to help the private sector in building affordable housing, which is desperately needed,” Powell said. “This means working families and seniors, it would be a big hit.”

Under Prop1A, the state has the right to borrow up to 8 percent of local property taxes in a financial crisis, which it is required to pay back within three years.

For Roseville, this means parting with up to $3.5 million.

Roseville Treasurer Russ Branson said if the state opts to enact Prop1A borrowing, Roseville may decide to use the $9.8 million saved as reserve funds to cushion the blow.

“($3.5 million) is equal to the loss of 90 more jobs and a 5 percent reduction in compensation across the board in general fund employees,” Branson said. “I don’t think that would be our recommendation. I feel comfortable using the reserve money without a major impact to our general fund operations.”

This is not the first time the state has turned to local governments to fill a fiscal gap. In the early 1990s the passing of Prop 13 transferred property taxes from cities and counties statewide for the Education Revenue Augmentation Fund.

Roseville has since lost more than $50 million and property tax continues to be 20 percent lower than it was in the early 1990s.

Powell said the state’s pattern of relying on local city and county funds to bridge a financial gap is a pattern many city officials call “City Bank.”

“We are expected to balance our budgets and fix our finances on our own, we expect the state to balance theirs,” Powell said. “ I think that’s what the people expect as well.”