THE QUESTION Should the California Constitution be amended to allow local school bonds to be approved by 55 percent vote, instead of the current two-thirds vote, of the local electorate? PROVISIONS Changes the vote requirement for local school bonds and property tax limits for repayment This measure changes the State Constitution to lower the threshold for voter approval to 55 percent for bond measures for school facilities in a local election and provides for repayment of the bonds by allowing property taxes to exceed the current 1 percent limit. The constitutional requirement for a 55 percent voter approval would apply only if the local bond measure that is presented to voters includes:
Statutory changes for charter school facilities This proposition also amends the Education Code section regarding charter school facilities. Proposition 39 would require each local K-12 school district 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; other revenues, such as state and local bonds, could be used. The facilities must be reasonably equivalent to the district schools that the charter school students would otherwise attend. A district may charge the charter school a pro-rata share for its facilities if district discretionary revenues are used. A district may decline to provide facilities for a charter school with a current or projected enrollment of fewer than 80 students.
Note: The Proposition 39 constitutional amendments providing for lower voting requirements for passage of local school bonds could only be changed with another statewide vote of the people. The statutory provisions for charter schools could be changed by a majority vote of both houses of the legislature and approval by the governor, but only to further the purposes of the proposition. BACKGROUND In California, school districts and other local government entities have traditionally obtained funds for facilities 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. The measure 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. However, it still requires two-thirds approval of bond measures. Between 1988 and 1998, about half of all local school bonds in primary and general 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 $18 billion in state general obligation bonds for K-12 school facilities, including the $6.7 billion from 1998's $9.2 billion Proposition 1A which funding for higher education on K-12. Bond funds from before 1998 are largely expended. The Proposition 1A funds are available to local school districts on a matching fund basis and are also rapidly being committed. Through these bonds 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. In addition to state bonds, funding for school facilities has been provided from other sources, such as: school district general obligation bonds; special local bonds (known as "Mello-Roos" bonds) and fees charged to builders and developers. In the March 2000 Primary Election, Proposition 26, an initiative constitutional amendment, attempted to amend the Constitution to require a majority vote to pass bond measures, but it failed to get voter approval. Charter Schools Charter schools are independent public schools formed by teachers, parents, and other individuals and/or groups that are exempt from most state laws and regulations affecting public schools. As of June 2000, 309 charter schools were functioning in California, serving about 105,000 students (less than 2 percent of all K-12 students). The schools function under contracts or "charters" with local school districts, county boards of education, or the State Board of Education. Under current law, school districts must allow charter schools to use, at no charge, facilities not currently used by the district for instructional or administrative purposes. Independent charter schools are not entitled to any building funds but can apply for grants from other sources including the state. FISCAL EFFECT Impact on K-14 school districts Proposition 39 would make it easier for school bonds to be approved by local voters. According to the Legislative Analyst, between 1986 and June 2000:
If more local school bonds were passed, local debt service costs would increase. According to the Legislative Analyst, the cost to any particular district would depend primarily on the size of the bond issue. (See box for the impact on a typical property owner.) 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 affect demand for state bond funds in several ways. If more local bonds are approved, fewer local school districts would require state hardship funding--state funding 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. However, state funding pressures could increase if those school districts in California that do not currently participate in the state school facilities program for matching funds are encouraged to do so by the passage of Proposition 39. This would offset some of the savings in state debt service costs. The proposition's fiscal impact on the state could become more evident in a few years as local districts assume greater funding responsibility for school facilities. The state's debt service costs would decline over time. Impact of 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. This proposal would require districts to provide charter school facilities reasonably equivalent to those the students would otherwise attend. 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 55 percent of the voters could approve local K-14 school bond measures; K-12 school districts would be required to provide facilities for charter schools reasonably equivalent to those the students would otherwise attend. A NO vote means that local K-14 school bond measures would continue to require approval by two-thirds of the voters; school districts would continue under the requirement that they allow charter schools to use facilities they are not currently using. SUPPORTERS SAY
OPPONENTS SAY
SUPPORTERS AND OPPONENTS The official ballot arguments in support are signed by Lavonne McBroom, President, California State PTA; Allan Zaremberg, President, California Chamber of Commerce; and Jacqueline N. Antee, American Association of Retired Persons. The official ballot arguments in opposition are signed by Jon Coupal, Chairman, Save Our Homes Committee, Vote No on Proposition 39, a Project of the Howard Jarvis Taxpayers Association; Dean Andal, Chairman, Board of Equalization, State of California; Felicia Elkinson, Past President, Council of Sacramento Senior Organizations. For more information: Supporters: Taxpayers for Accountability and Better Schools, Yes on Proposition 39, 916-341-1055; email: info@betterschoolsforca.org ; website: www.yesonprop39.org Opponents: Jon Coupal, Save our Homes Committee, Vote No on Proposition 39, 916- 444-9959; email: Info@SaveOurHomes.com; website: www.SaveOurHomes.com
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