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KINDERGARTEN-UNIVERSITY PUBLIC EDUCATION FACILITIES
BOND ACT OF 2004

Legislative Bond Act

THE QUESTION

Should the state sell twelve billion three hundred million dollars ($12,300,000,000) in general obligation bonds for construction and renovation of K-12 school facilities and higher education facilities?

THE SITUATION

In November 2002, the voters approved Proposition 47, the first $13 billion of a $25 billion bond package for K-12 and higher education facilities construction and repair. The size of the package was based on the backlog of unfunded projects and projections of over one million additional K-12 students and about 700,000 college students entering the system in the next decade.

THE PROPOSAL

Proposition 55 allows the state to issue $12.3 billion of general obligation bonds for construction and renovation of K-12 school facilities and higher education facilities.

$10.0 billion for K-12 facilities:

• $5.26 billion for new construction with local districts paying 50 percent of costs. (Up to $300 million of this amount would be available for charter school facilities.)
• $2.25 billion for rehabilitation of older schools with local districts paying 40 percent of costs
• $2.44 billion for districts with critically overcrowded schools
• $50 million for joint-use projects such as facilities used by both a K-12 school district and a local library district

$2.3 billion for public higher education facilities--construction of new buildings and related infrastructure, alteration of existing buildings, and purchase of equipment for use in these buildings:

• $920 million for community colleges
• $690 million for the California State University
• $690 million for the University of California.

The Governor and Legislature would select the specific projects to be funded.

FISCAL EFFECT

Costs are estimated to be $24.7 billion over 30 years with average payment for principal and interest being $823 million a year.

WHAT A YES OR NO VOTE MEANS

A YES vote means that $12.3 billion in general obligation bonds could be sold for construction and renovation of K-12 school facilities and higher education facilities.

A NO vote means that $12.3 billion in general obligation bonds could not be sold for these purposes.

SUPPORTERS SAY

• 73 percent of California classrooms are over 25 years old and our classrooms are the third most crowded in the nation.
• Proposition 55 is an investment in the future of our economy, and it will produce local jobs.
• The measure contains strict accountability standards to assure that the funds are not wasted.
• The state treasurer says that Proposition 55 is a sound investment.

OPPONENTS SAY

• California has tens of billions of dollars in outstanding bonds and has the worst credit rating in the nation. This is no time to take on more debt.
• We could build and repair schools without borrowing the funds if the issue was given a higher priority in the state budget.
• Half of all school districts received nothing from the 2002 bond measure. Many districts cannot meet the 40 percent local matching fund requirement.
• 25 percent of the funds would go to Los Angeles, which has only 12 percent of the students.

For more information:

Supporters: Californians for Accountability and Better Schools, 888-563-0055, www.Yeson55.com

Opponents: California Taxpayer Protection Committee, 916-991-9300, www.ProtectTaxpayers.com

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