As the election nears, Gov. Jerry Brown is stepping up his involvement in the campaign to defeat Proposition 53. The initiative, which would require voter approval before California can issue more than $2 billion of revenue bonds for a state project, threatens high-speed rail and the proposed water conveyance tunnels under the Delta, two of Brown’s legacy projects.
In addition to contributing millions of dollars, recording a robocall and enlisting his dog, Sutter, for the effort, Brown recently filmed an ad against Prop. 53 at the Governor’s Mansion in Sacramento that is now airing on television statewide.
I’m Gov. Jerry Brown, urging you to vote no on Proposition 53. It may sound OK, but it’s bad for California. 53 takes away local control. It increases the cost of roads, bridges and hospitals. 53 is paid for by one millionaire, but it’s opposed by almost everybody else: firefighters, nurses, newspapers and hundreds of organizations. We say no on 53, because it’s bad for California. Please, vote no on 53.
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Like other opponents, Brown overstates the expected impact of Prop. 53. Though the effects he describes are real, they are far from the certainty that he suggests.
Prop. 53 is unlikely to interfere significantly with local control over infrastructure projects, the traditional use for revenue bonds. It covers only projects “funded, owned, operated, or managed by the state” and exempts bonds issued by cities, counties, schools, community colleges and special districts.
Those entities sometimes partner with the state, through “joint powers authorities” or similar bodies, for financial assistance on projects that have only a regional focus. While the resulting ventures could be covered by Prop. 53, they are almost never financed with more than $2 billion of revenue bonds, which are repaid with user fees or other earnings from a project.
For projects that do qualify for a statewide vote under Prop. 53, the fiscal impact is ambiguous. According to an analysis by the nonpartisan Legislative Analyst’s Office, costs could be higher or lower depending on the government’s response.
A delay in developing a project until after an election takes place, for example, might drive up costs. So could selecting a more expensive alternative source of financing, like teaming up with a private company that would sell bonds instead.
But the prospect of going to the ballot might compel the state to find savings that would lower the overall price tag of the project. They could also fund it with general obligation bonds, which are paid back from the general fund, have a lower interest rate than revenue bonds and already require voter approval.
Prop. 53 is backed by wealthy Stockton-area farmer Dino Cortopassi and his wife, Joan, who have funded the entire campaign with more than $5 million of their own money. Cortopassi, a vocal opponent of the Delta tunnels, has said he is concerned about “profligate spending” and debt. It is also supported by taxpayer groups, the California Republican Party and a handful of newspapers.
A much broader coalition is opposed to Prop. 53. It includes an uncommon alliance of unions and business groups, as well as local governments, water agencies, farmers, the California Democratic Party and most of the state’s major newspapers.
PoliGRAPH is The Bee’s political fact checker, rating campaign advertisements and candidate claims as True, Iffy or False.