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LEAGUE OF WOMEN VOTERS OF CALIFORNIA EDUCATION FUND	Nonpartisan Pros & Cons of PROPOSITION 16 VETERANS' HOMES BOND ACT OF 2000.
	Legislative Bond Act

THE QUESTION

Should the state borrow $50 million through the sale of general obligation bonds to construct and renovate state-owned veterans' homes?

THE SITUATION

State veterans' homes provide care for elderly and disabled veterans. Two veterans' homes, one built in 1884 in Napa County and one completed in 1996 in San Bernardino County, provide care for about 1,800 veterans. The number of veterans who qualify to live in these homes will grow considerably over the next ten years.

The federal government provides 65% of the construction costs for veterans' homes. The state provides the other 35% through either general obligation bonds or higher-cost lease-payment bonds. Three new homes have been approved for construction, with the state's share presently coming from higher-cost lease-payment bonds which would be replaced by a portion of the Proposition 16 funds.

THE PROPOSAL

Proposition 16 would:

· authorize the sale of $50 million in general obligation bonds to renovate and construct state-owned veterans homes

· use $24 million of the funds to replace current higher-cost lease-payment bonds.

FISCAL EFFECT

The Legislative Analyst estimates the measure would cost approximately $33 million over 25 years, with payments of about $1 million per year coming from the General Fund. Savings from the replacement of higher-interest lease-payment bonds would offset some cost of repaying the general obligation bonds. State operating costs for expanded facilities would increase to care for additional veterans.

SUPPORTERS SAY

· These funds are urgently needed to provide care for the growing number of United States veterans who live in California.

· These bonds will not increase taxes, and the amount requested is small compared to the amounts of most other general obligation bonds.

OPPONENTS SAY

· Funds for veterans' home repairs have come from the General Fund through budget acts for the past 15 years, and this practice could suffice for the future.

· Instead of building new veterans' homes, the government could place and pay for veterans in private facilities that already exist.

For more information:

Supporters: (916) 441-4759, www.vetbond.com
Opponents: (626) 614-0630, www.ca.lp.org

(Analysis prepared by the League of Women Voters of California Education Fund
for the March 7, 2000 Election.)

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Last updated: January 18, 2000
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