THE QUESTION Should the California Constitution be amended to allow local school bonds to be approved by a simple majority of voters instead of the current two-thirds? PROVISIONS Vote requirement for local school bonds Proposition 26 provides that: (1) K-14 jurisdictions could incur bonded indebtedness for the construction or rehabilitation of K-14 school facilities if approved by a simple majority of the local voters; and (2) property taxes could exceed the current 1 percent limit in order to repay the bonds. This majority vote requirement would apply only if the local bond measure submitted to the voters for approval includes:
Charter school facilities This measure requires local K-12 school districts in California to provide charter school facilities sufficient to accommodate each charter school's students. The district would not be required to spend its general discretionary revenues to provide these facilities. The district could choose to use these or other revenues, including state and local bonds. Other provisions for charter schools:
BACKGROUND In California, school districts and other local government entities have traditionally obtained funds for buildings by incurring long-term debt in the form of local general obligation bonds repayable from property taxes assessed within the district. The state's second constitution, adopted in 1879, mandated a two-thirds vote to approve local general obligation bonds over $300,000. In 1978, voters approved Proposition 13, an initiative constitutional amendment that limited property taxes. It also imposed restrictions on the taxing authority of local governments that effectively banned local general obligation bonds. This caused school districts to rely on statewide bond measures for school facility funding. In June 1986, voters amended the Constitution to restore the property tax funding mechanism for local general obligation bonds, but it still requires two-thirds approval of bond measures. Between 1988 and 1998, about half of all local school bonds in general and primary elections won a two-thirds majority, according to the Public Policy Institute of California. During that same period, about half of the school bond measures received a majority vote, but less than two-thirds, and thus were not approved. Since 1986, California's voters have approved over $15 billion in state general obligation bonds for K-12 school facilities, including $6.7 billion from 1998's $9.2 billion Proposition 1A. Bond funds from before 1998 are largely expended. The Proposition 1A funds are available to local K-12 school districts on a matching funds basis and are also rapidly being committed. The state will fund 50 percent of the cost of new schools and 80 percent of the cost of rehabilitating existing schools. Local school districts must raise their share of the funds by attempting to pass bond measures that require two-thirds voter approval. In certain hardship cases, the state will pay 100 percent of the cost. The state funds 100 percent of the cost of state-approved projects for community colleges. FISCAL EFFECT Impact on K-14 school districts According to the Legislative Analyst, between 1986 and June 1999:
If more local school bonds were passed, local debt service costs would increase. According to the Legislative Analyst, the extent of these costs would depend primarily on the number of bond measures approved that would not have been approved with a supermajority requirement. The magnitude of these costs on a statewide basis is unknown, but could easily amount to hundreds of millions of dollars within a decade. Impact on state costs The Legislative Analyst is less certain about the proposition's impact on state costs. In the near term, it could have several effects on demand for state bond funds. If more local bonds are approved, fewer local school districts would require state hardship funding, and state funding in those cases would be reduced from 100 percent to 50 percent of the cost for a new local school. On the other hand, over 500 school jurisdictions do not currently participate in the state school facilities program. If the reduced voter-approval requirement encourages some of these districts to participate in the state program, demand for matching state bond funds would increase. Over the long term, however, local school districts could assume more responsibility for funding school facilities. Thus the state's debt service costs would eventually decline. Impact on charter schools According to the Legislative Analyst, the requirement that K-12 school districts provide charter schools with comparable facilities could increase state and local costs. Districts are currently required to provide facilities only if unused district facilities are available. Many local school districts might increase the amount of their bond issues to cover the costs of charter school facilities. To the extent that districts receive state matching funds, this could increase state costs, but the amount of this increase is unknown. IMPACT OF YES OR NO VOTE A YES vote means that a majority of voters voting in that election could approve K-14 local school bond measures. K-12 school districts would be required to provide facilities for charter schools. A NO vote means that K-14 local school bond measures would continue to require approval by two-thirds of the voters and that school districts would be required to allow charter schools to use facilities not currently used by the district. SUPPORTERS SAY
OPPONENTS SAY
SUPPORTERS AND OPPONENTS The official ballot arguments in support are signed by Lavonne McBroom, President, California PTA; Allan Zaremberg, President, California Chamber of Commerce; Wayne Johnson, President, California Teachers Association; Jacki Antee, President, American Association of Retired Persons; Bill Hauck, Chairman, California Business for Education Excellence; and Gail Dryden, President, League of Women Voters. Other supporters mentioned in the ballot arguments include California Manufacturers Association, California Organization of Police and Sheriffs, California Business Roundtable and Congress of California Seniors. The official ballot arguments in opposition are signed by Jon Coupal, Chairman, Don't Double Your Property Taxes, Vote No on Proposition 26, a Project of the Howard Jarvis Taxpayers Association; Felicia Elkinson, Past President, Council of Sacramento Senior Organizations; Richard H. Close, President, Sherman Oaks Homeowners Association; Joan C. Longobardo, Governing Board Member, Covina-Valley Unified School District; and Gil A. Perez, Retired School District Administrator. Other opponents mentioned in the ballot arguments include the California Federation of Teachers. For more information: Supporters: Gale Kaufman, Let's Fix Our Schools Committee--Yes on Prop. 26, 916-554-0324, email info@letsfixourschools.com, www.letsfixourschools.com Opponents: Jon Coupal, Don't Double Your Property Taxes, Vote No on Proposition 26, 916-444-9959, email Info@SaveOurHomes.com, www.SaveOurHomes.com
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