Copyright© 2000 by School Services of California, Inc.

July 7, 2000

Statutory Restrictions Proposed for 55% Bond Initiative

In past elections, initiatives to reduce the 2/3 vote requirements for local general obligation bonds for school facilities have encountered opposition based upon several concerns. Many of the reasons given for opposing the measure are related to what might happen to local tax rates and oversight of how the money is spent. In an effort to give the 55% initiative that will appear on the November 2000 ballot a better chance than its predecessors (Prop 26 of 2000 and Prop 170 of 1993), Senator Jack O'Connell (D-San Luis Obispo) and other legislators have proposed eliminating some of these fears by imposing statutory restrictions on the issuance of "55% bonds." These restrictions are, of course, conditioned on the passage of the 55% initiative, and would only apply to districts that, in advance of the election, agree to play by the "55% rules" and thereby receive the "55% benefit."

Both SB 2066 (O'Connell) and AB 1908 (Lempert, D-San Carlos) seek to reduce voters' concerns by imposing statutory restrictions that address those concerns. The most important restrictions are in the following areas:

• Limiting the election dates on which "55% bonds" could be considered to the statewide primary and general elections, regularly scheduled local elections, and statewide special elections. In other words, the "any Tuesday" rule that applies to "2/3 bonds" would not apply to "55% bonds."
  
• Requiring establishment of a Citizens Oversight Committee with specific membership requirements and a specific list of responsibilities. Providing statutory authority for the oversight committee is intended to reduce concerns about how bond dollars are spent.
  
• The most controversial restriction is in the area of limitations on the total increase in the local property tax rate. In addition to the current bonding capacity limits, expressed as a percentage of assessed valuation, these proposals would also limit the tax increase to a total of $60 per $100,000 of assessed valuation for unified districts or $30 each for elementary and secondary districts. The limit would be applicable to each bond measure that is passed and so a district could conceivably have several "55% bonds" at $60 each, resulting in a higher total tax.

It is the intention of the authors that districts that did not accept these restrictions continue to have the option to do bond elections that require a 2/3 vote under the current rules. Only districts that want to avail themselves of the 55% vote would be bound by these restrictions.

While it will be difficult for some "die-hard 50%-ers"Cwho have already had to concede 55% instead of 50%Cto accept even more concessions, it should be remembered that the hardest of the "die-hards," Senator O'Connell, is the leading advocate for these measures. He sees them as another tool that can be used by school districts that are otherwise unable to clear the two-thirds barrier to accessing local bonding capacity. If he believes these restrictions are necessary and acceptable in order to reduce the 2/3 vote, we should all consider them carefully.

--Ron Bennett