Lawmakers return to Public Bonds; Bills to Link Water, Planning Stalled by Builders, Wet Winter
General obligations bonds to rehabilitate California's crumbling infrastructure and build new public facilities are rising toward the top of the state Legislature's agenda now that Gov. Davis' education reform package is complete. The bonds, which could start hitting the ballot as soon as next March, would pay for everything from roads and water systems, to parks, libraries and homes.
Lawmakers have introduced $30 billion worth of general obligation bond proposals. Some of the proposals compete with one another, and analysts do not expect all bond packages to reach the ballot. However, several of the proposals, including a $16 billion transportation bond, are advancing through committees.
New Democratic Treasurer Phil Angelides intends to release a special edition of the annual debt affordability report in mid-May, according to spokeswoman Cathy Calfo. "He will evaluate bond proposals in the context of that report," she said.
Rather than set a dollar limit on borrowing, as past debt affordability reports have, the special report will review investment strategies and consider sustainable development patterns, Calfo said.
While there is no shortage of people who see the need to "do something" about infrastructure, consensus on financing is absent. The California Business Roundtable recently projected a $33 billion deficit in infrastructure funding during the next 10 years, but that organization and the California Manufacturers Association favor a pay-as-you-go approach embodied in SCA9, by Steve Peace, D-El Cajon. The constitutional amendment would dedicate one-quarter cent of the existing sales tax, or about $1 billion annually, to a new State Infrastructure Fund. The account would finance highways, libraries, schools, water systems, parks and other public structures.
The $16 billion transportation infrastructure package, SB 315, by Senate President Pro Tem John Burton, D-San Francisco, would go to voters in $4 billion increments every two years starting in November 2000. The money would rehabilitate highways, help local agencies fix roads and repair storm damage, and provide capital for public transit projects. The money also would go toward "completion of high-priority capital projects of statewide significance." Burton has not yet spelled out these projects and must decide whether to allocate the money for new highways backed by developers and suburban politicians, or public transit projects that are popular with environmentalists and big city leaders. California ranks 48th nationally in highway spending, according to Burton's office.
Other bond proposals
Behind the transportation package, the second-largest bond is the $4.1 billion proposal for prisons and jails. The bond, which would go to voters in March 2000, would build six new state prisons and provide matching funds for construction and rehabilitation of local jails and juvenile halls. The California State Association of Counties is among the supporters of AB 326, by Assemblyman Bill Leonard, R-Rancho Cucamonga.
Of interest to planners and housing advocates are two housing bonds — a $980 million package that would go to voters in four increments, and a separate $750 million proposal. The first proposal, SB 510, by Sen. Richard Alarcon, D-Los Angeles, breaks down this way: $260 million for first-time homebuyer down payment assistance, $200 million for senior and disabled rental housing, $200 million for housing rehabilitation, preservation and code enforcement, and the remainder for rentals, farmworker housing, welfare-to-work housing and sweat-equity projects. The latter measure, AB 398 by Assemblywoman Carole Migden, D-S.F., earmarks the bulk of funds, $550 million, for rental housing construction and rehabilitation. The rest would go for home purchase assistance and farmworker housing.
California voters have not approved a housing bond since 1991, and that money was spent by the end of 1996, said Howard Yee, a consultant to the Senate Housing and Land Use Committee. At the same time, the state has become even more of a last-resort for housing programs. "With federal funding shrinking and local agencies having limited money, there is nowhere else to go," Yee said.
Environmentalists have cheered three proposals to issue bonds for parkland purchases and natural resource protection. The $2 billion plan from Sen. Tom Hayden, D-Santa Monica, would provide $500 million for state parks, $500 million for local and regional parks, $460 million for open space and habitat, $440 million for fish and wildlife, and coastal projects, and $100 million for zoos, aquariums and environmental education. Six state land conservancies, some of which hurt for money (see CP&DR April 1999), would get about $390 million from Hayden's plan, SB 57. A November 2000 election is proposed.
Assembly Speaker Antonio Villaraigosa, D-Los Angeles, introduced a $1.5 billion bond for the March 2000. The measure, AB 18, targets parkland as well as natural, cultural and historical resources. It contains about $300 million for state land conservancies. Senate Bill 2, by Wesley Chesbro, D-Arcata, is an $854 million park and resource improvement bond.
Because of term limits, the Legislature is full of new members, many of whom were recently city councilmembers or county supervisors. Because of their local government experience, many of them have introduced bills related to land use issues, said Sande George, lobbyist for the California Chapter of the American Planning Association.
"They all had a pet peeve when they were sitting in the council meetings or the board chambers, and now they want to do something about it," George said. The CCAPA's list of the top 10 planning bills actually contains 100 measures.
Among the planning proposals receiving attention is a trio of bills that would more closely link water supply with development decisions. After meeting stiff resistance from developers and the real estate community, the authors have put their legislation on hold until next year.
The biggest change is embodied in AB 1219, by Assemblywoman Sheila Kuehl, D-Santa Monica. It would require a city or county to reject a proposed development if the local water agency said it could not serve the development. The CCAPA supports the water supply-land use link, but this provision "constitutes a major shift in land use planning law from the city and county to the water agency," CCAPA Vice President Ted Commerdinger wrote to Kuehl. "A no-growth water agency could cause havoc in a quickly growing jurisdiction on a project-by-project basis."
East Bay Municipal Utility District sponsored AB 1219 and two related bills, SB 1130, by Sen. Jim Costa, D-Fresno, and AB 1277, by Assemblyman Helen Thomson, D-Davis. The Costa bill would close loopholes in his 1995 legislation (SB 901) by requiring the Department of Water Resources to prepare a water supply assessment for large developments if the local agency refused or if an environmental impact report does not identify a water system. The Thomson bill would require a Local Agency Formation Commission to determine whether water supplies are adequate before approving an annexation.
According to East Bay MUD lobbyist Randele Kanouse, only 4 of 57 environmental impact reports for projects of 500 homes or more have complied with SB 901's mandate to link water sources and land use planning. However, a fifth consecutive wet year made for a tough sell, he said.
"This isn't about slowing down growth, this is about developers paying their own way," Kanouse said.
The California Association of Realtors, California Building Industry Association and California Chamber of Commerce opposed the water and land use bills.
"It comes down to not wanting to give the water agency, who isn't elected for this purpose, authority over local land use," said Eileen Reynolds, a lobbyist for the Association of Realtors. "We don't want developments to go on line if there is no water to go to them."
Proposed CEQA changes
A bill that would make significant changes to CEQA is SB 755 by Hayden, who contends a portion of the bill simply codifies recent court decisions and administrative guidelines. The bill would preclude a city or county from considering an increase in revenues when approving a development in spite of significant environmental impacts, according to a Senate Committee on Environmental Quality analysis. The bill also would require a city or county to approve a master EIR prior to, or concurrent with, approval of any phase of a project. The master EIR could be used for five years.
Environmental justice advocates have reintroduced legislation similar to measures Pete Wilson vetoed. Among this year's bills is SB 115, by Sen. Hilda Solis, D-El Monte, It would place a number of requirements on the Office of Planning and Development, which would have to identify communities disproportionately affected by high and adverse environmental effects, according to an analysis. The bill also calls for changes to CEQA guidelines so that cities and counties mitigate disproportionate environmental impacts in poor or minority neighborhoods.
Howard Yee, Senate Housing and Land Use Committee, (916) 445-8740.
Randele Kanouse, East Bay Municipal Utility District, (916) 443-6948.
Eileen Reynolds, California Association of Realtors, (916) 444-2045.
Sande George, California Chapter of the American Planning Association, (916) 443-5301.
Randy Pestor, Senate Committee on Environmental Quality, (916) 324-0894.