THE QUESTION Should the state borrow $1.97 billion through the sale of general obligation bonds to finance programs designed to provide safe drinking water, water quality, flood protection, and water reliability? PROVISIONS This measure authorizes the state to use the funds from these general obligation bonds for the following programs:
BACKGROUND The state provides loans and grants to local agencies for various programs, such as improving the safety of drinking water, flood control, water quality, and the reliability of the water supply. Funding comes from general obligation bonds as well as from the state's General Fund. Most of the funds authorized for these purposes from prior bond acts are spent or committed to specific projects. Approximately $250 million of this act is dedicated specifically to carrying out the CALFED Bay-Delta Program. This program is a joint state and federal effort to develop a long-term approach for better management of environmental and water resources in the San Francisco Bay/Sacramento-San Joaquin Delta Estuary (Bay-Delta). This area supplies a substantial portion of the water used throughout the state for domestic, industrial, agricultural, and environmental needs including the drinking water for approximately 22 million California citizens. Program costs for the first stage of the CALFED Bay-Delta plan are estimated at around $5 billion. It is anticipated that funding will come from a variety of federal, state, local, and private sources. Proposition 204, approved by voters in November 1996, provided $583 million for improvements to the Bay-Delta, primarily to improve fish and wildlife habitat. Approximately $415 million of these bond funds is available for projects. Watershed protection programs are a relatively new way for the state to manage its natural resources. Instead of using primarily a site-by-site approach, the state now takes a broader approach by focusing on the entire watershed. Under this "watershed management" approach, programs designed to improve water quality and reliability of supply, restore and enhance wildlife habitat, and address flood control within a watershed are coordinated, often involving various federal, state, and local agencies. This proposition does not have anything to do with previous ballot measures with the same number. Proposition 13 in 1978 dealt with property taxes. There was another Proposition 13 in 1982, and then the Legislature required that propositions be numbered consecutively for a 20-year span. As proposition numbers went into the 200s, the Legislature decided to start numbering over again with the November 1998 election and amended election law to make the consecutive numbering period 10 years long. The fact that the water bond act is Proposition 13 is simply a coincidence. FISCAL EFFECT According to the Legislative Analyst, the total estimated state cost would be $3.4 billion over 25 years ($1.97 billion in principal and $1.4 billion in interest). Payments would be about $135 million per year. There are potential costs of an unknown amount to local governments to operate and maintain projects developed with these bonds. There are provisions in the proposition that will require repayment of certain loans made under this measure to be placed in the General Fund (a potential saving of up to $510 million). IMPACT OF YES OR NO VOTE A YES vote means the state could sell $1.97 billion in bonds for a safe drinking water, water quality, flood protection, and water reliability program. A NO vote means the state could not sell bonds for these purposes. SUPPORTERS SAY § Programs included in this proposition continue the efforts of the CALFED Bay-Delta program, an important process in solving California's water needs. § The programs of Proposition 13 are of statewide benefit, and since they are capital outlay projects, it is appropriate to use state bond funding, which is a very inexpensive form of financing for projects with long-term benefits. § This investment is fiscally responsible because it qualifies California for new federal funds, limits administrative costs, and does not raise taxes. § Proposition 13 helps meet safe drinking water standards to protect public health and increases the reliability of our water supply in the event of a drought or emergency. § This measure provides enough new water for eight million people through conservation, recycling, underground storage and better use of reservoirs. § Proposition 13 fights pollution in lakes and rivers and along our coast; protects water quality from pesticides and agricultural drainage; improves water treatment plants, cleans up urban streams and controls seawater intrusion into clean water supplies. OPPONENTS SAY § Voters approved Proposition 204 in 1996, authorizing $995 million in bonds for the "Safe, Clean, Reliable Water Supply Act." Why does the government need almost $2 billion more? § Residential customers, who use only 15% of California's water, subsidize agricultural and commercial customers. If big water users had to pay the real cost of their water, they would work harder to conserve water. § Those who pollute our rivers and lakes should be held fully responsible for the damage they do. Taxpayers shouldn't pay for damages caused by private businesses and individuals. § This is "pork barrel" spending, with so many projects included that the voters can't separate the worthwhile projects from the others. § Local governments should determine how to finance their projects. The lowest cost would be to promote private investment rather than government spending. § These projects could have been funded out of last year's budget surplus. The use of bonds almost doubles the cost of any government project. Taxpayers must pay the principal and interest on these bonds for 30 years. SUPPORTERS AND OPPONENTS The official ballot arguments in support are signed by Governor Gray Davis; Allan Zaremberg, President, California Chamber of Commerce; Leslie Friedman Johnson, Water Program Director, The Nature Conservancy; Larry McCarthy, President, California Taxpayers' Association; Jim Costa, Chairman, Senate Agriculture and Water Resources Committee; and Michael J. Machado, Chairman, Assembly Water, Parks and Wildlife Committee. Other supporters mentioned in the ballot arguments include Association of California Water Agencies, Agricultural Council of California, Audubon Society, League of Women Voters, California Business Roundtable, National Wildlife Foundation, California Manufacturers Association, Planning and Conservation League, California State Association of Counties, California State Council of Laborers, Southern California Water Committee, and Northern California Water Association. The official ballot arguments in opposition are signed by Gail K. Lightfoot, Past Chair, Libertarian Party of California; Thomas Tryon, Calaveras County Supervisor; Ted Brown, Insurance Adjuster/Investigator, and Dennis Schlumpf, Director, Tahoe City Public Utility District. For more information: Supporters: Larry Sheingold, Californians for Safe, Clean, Reliable Water, Yes on Proposition 13, 916-484-3725, www.prop13.org Opponents: Ted Brown, Libertarian Party of California, 626-614-0630, email tebrown@earthlink.net, www.ca.lp.org
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