SPUR VOTER GUIDE
February 2008
Released
Jan. 1, 2008
Contact
Egon Terplan, Economic Development and Governance Policy Director
415-781-8726 x131, eterplan@spur.org
Proposition A
“Clean and Safe
Neighborhood Parks General Obligation Bond Election”
Recreation and Park and Port $185 Million Bond
Authorizes the Board of Supervisors to issue up to $185 million in bonds to pay for the repair and renovation of city parks.
What it does
This general-obligation bond program is a joint project of the San Francisco Recreation and Park Department and the Port of San Francisco. Of the total $185 million in bonds, $151.5 million is for the Recreation and Park Department and $33.5 million for the Port.
Two-thirds of all voters must approve the measure for it to take effect. If it passes, the Board of Supervisors will be authorized to sell $185 million worth of bonds to finance the projects. The City will use bond proceeds to repair, replace and upgrade neighborhood recreation facilities and athletic fields, reforest parks, repair restrooms, restore trails, and improve access to open space. The bond proceeds also will help strengthen waterfront access and establish the “Blue Greenway,” a 13-mile series of parks, walkways, art and other infrastructure along the City’s southeastern waterfront, from China Basin to Candlestick point.
The Recreation and Park Department’s portion of the bond proceeds is proposed to fund:
- $117.4
million for playground safety and for repair, replacement, seismic work,
modernization and landscaping for 12 recreation centers and playgrounds.
- $11.4
for the repair or replacement of park restrooms.
- $8.5
million to match City Fields Foundation grant funds to renovate athletic fields
with artificial turf and lights, to increase the capacity and use of existing
fields.
- $5
million to restore walking trails and improve access to open space.
- $5
million to provide a small-grant funding program to repair and improve parks nominated
by community groups with a financial or sweat-equity match.
- $4
million to plant trees and restore the aging park tree canopy.
Of the funds designated for the fourth, fifth and
sixth projects, 20 percent will be held back as a reserve to ensure that there
is enough money to complete the first, second and third projects.
The Port’s portion of the
bond proceeds is proposed to help establish a Blue Greenway plan to provide
new, publicly accessible waterfront parks and open space along Port land on the
eastern and northern side of the city, including:
- $8
million for the seismic repair of a failing seawall at Pier 43, the removal of
an unsafe pier and the extension of the Embarcadero Promenade into
Fisherman’s Wharf.
- $3
million for the Brannon Street Wharf to repair the failing wharf and to add
neighborhood open space and a small-boat launch.
- $22.5
million to help construct the 2006 Blue Greenway open-space improvements such
as Bayfront Park at Mission Bay, Crane Cove at Pier 70, Islais Creek, and
Heron’s Head Park. The community planning process would be continued to
further define these projects or other Blue Greenway projects.
Proposition A also features the
strongest accountability and transparency measures ever included in a
general-obligation bond measure:
- Clear
criteria for the selection of projects, ensuring that the selection process is
transparent and apolitical.
- Specific
lists of projects and budgets, ensuring that voters understand how funds will
be used.
- Extensive
cost estimates to ensure realistic, deliverable project budgets, project scope,
schedules and large contingency allocations for construction inflation, etc.
- Improved
and more accessible web-based project reporting on bond expenditures, and
updates on construction and schedules.
- Strengthened
oversight of bond expenditures and implementation by the Citywide Capital
Planning Committee, the Citizens General Obligation Oversight Committee, the
Recreation and Park Commission, and the Port Commission, as well as mayor and
Board of Supervisors. Funds are allocated for audits of the bond by the
Controller’s Office, as requested by the citizens committee.
- Establishes
processes for responding to unexpected circumstances by setting clear rules to
guide any necessary reallocation of bond funds.
How it got on the
ballot
Under state law,
general-obligation bonds require the approval of two-thirds of participating
voters in an election. They cannot be approved by local legislative bodies, but
must appear as a ballot measure. Proposition A is the first general-obligation
bond under the City’s 10-year capital plan, which sets the direction for
the construction and maintenance of City infrastructure for the next decade.
Future bonds for capital needs will fund renovations at General Hospital and
the Hall of Justice.
This bond appears on the February
2008 ballot instead of the June or November ballot because of a political
calculation that voters may be more likely to reject multiple bonds when
confronted with a major price tag. The June ballot may include large state
bonds and the November ballot will likely include a bond measure of $800
million to $1 billion for San Francisco General Hospital.
Parks in San Francisco have
serious capital needs, and there is insufficient money within the City’s
General Fund to pay for all needed repairs and renovations. SPUR recognized
this issue several years ago and wrote a paper, “The Big Fix,”
which focused on capital planning and deferred maintenance throughout the City.
The paper became the basis for legislation that was written by Supervisor Sean
Elsbernd and the Mayor’s Budget Office, and adopted by the mayor and
Board of Supervisors in 2005. The result: the first 10-year capital plan in the
city’s history that prioritizes basic life safety and public safety, as
well as other critical capital projects. The plan sets a schedule for series of
general-obligation bonds over a 10-year time frame. Proposition A is the first
bond in the series of bonds to be put to the voters to fund deferred maintenance.
In early 2007, the Recreation and
Park Department completed its first complete third-party assessment of all park
properties and facilities. Based on this assessment, the department has an
unmet capital need of roughly $1.7 billion. While this level investment to
restore and modernize buildings and park may go beyond what is necessary in
some situations (for example, replacing the historic cabins at Camp Mather in
the Sierras), it demonstrates a level of capital need of which this bond is
only a downpayment.
This is not the first bond for the
Recreation and Park Department. In 2000, voters approved a $110 million parks
bond measure. The adopted measure contained only a single sentence describing
the purpose of the bond as being for construction and repair of facilities, and
acquisition of open space. The lack of specificity resulted in confusion,
consternation and anger that “promised projects” listed in the
political marketing during the campaign for the bond measure did not get funded.
Some park advocates also were very concerned by the lack of accountability and
transparency, and by the nearly nonexistent cost estimating for potential
projects. The poor planning and budgeting resulted in cost overruns in some
cases, and projects that were never completed in others. Some parks advocates
were frustrated as a result.
The 2008 bond attempts to overcome
these past mistakes. In particular, the Recreation and Park Department will
work more closely with the Department of Public Works, which conducts the design
and construction-management services on many projects. Furthermore, the
department has reorganized its capital division to provide improved project
oversight and has brought on new project-management staff. They are in the
process of implementing a program-management system designed to increase
project controls and oversight.
If the bond passes, a general
concern is how well the Port and the Park Department will maintain the new and
renovated parks. All too often, City agencies renovate or build capital
projects with bond proceeds, only to allow them to deteriorate because
inadequate funds are used to maintain the projects. The mayor and the Board of
Supervisors reversed the trend of reduced operations funding this year by
increasing the department’s General Fund budget enough to hire 35 new
custodians, 15 new gardeners and 13 new park patrol officers.
Pros
Arguments for this measure:
- There
is an urgent need for repair and renovation of San Francisco’s parks. An
independent analysis identified $1.7 billion in structural repairs throughout
San Francisco’s parks. The bonds fund urgently needed seismic repairs to
heavily used recreation centers, such as the Sunset Recreation Center. The
bonds fund much-needed improvements to every freestanding restroom in a
neighborhood park to make those restrooms safe and clean.
- If
the bond fails in February, the Recreation and Park Department will not be able
to issue general-obligation bonds until 2013 based on the proposed bond
schedule in the City’s 10-year capital plan.
- The
bond measure has stronger accountability, reporting and transparency provisions
than any other City bond measure. This will help ensure the completion of the
identified projects within budget.
- The
measure focuses on neighborhood parks that have not received the same level of
financial support in prior bonds.
- The
Parks Department used transparent and objective criteria in the selection of
parks to receive funding. Criteria included seismic safety, physical
conditions, core park amenities and the density of population each park serves.
Those who are critical of these criteria often are those whose favorite park
was excluded in this analysis.
- The
Blue Greenway projects included in this bond are an exciting way to open the Bay
and waterfront to residents and visitors. Waterfront access, trails and public
art along a neglected part of the Bay are investments that will enhance the
overall quality of life in San Francisco.
- The
measure should be the catalyst for bringing in additional non-City monies to
enhance Port and Park Department capital projects.
Cons
Arguments against this measure:
- The
entirety of the bond measure funds only a limited number of parks. While parks
not identified in the bond may have access to some of the resources, they will
have to apply though a community opportunity fund.
- Although
the community was involved in project selection, the fact that the measure was
rushed to the February ballot means that not all stakeholders were brought on
board.
- The
bond does not include sufficient monies for basic infrastructure, such as
sprinklers and water fountains.
- The
Recreation and Park Department’s track record of implementing bond
projects is weak. If management of the bond funds is not significantly
improved, bond funds might not be used effectively.
SPUR’s Analysis
Proposition A is the first bond
measure to come out of the City’s 10-year capital plan. It is an
important indicator of the public’s willingness to issue debt primarily
for deferred maintenance with some new construction included.
The City is reasonably confident
that the issuance of the planned bond measures over the next 10 years will hold
the level of property taxes steady. As the City retires existing debt from
prior general-obligation bonds, that debt capacity becomes available for new
bond programs —while keeping tax rates level for property-tax payers.
If two- thirds of participating
San Francisco Voters do not approve Proposition A, it is likely that the
Recreation and Park Department would have to wait until 2013 to submit another
bond for voter approval. This is because of the schedule of bonds proposed in
the 10-year capital plan. The schedule seeks to spread out needed bond measures
across five or more years to increase the likelihood that voters will support
them. If Proposition A were to fail and the Recreation and Park Department
tried to introduce another bond measure before 2013, it is likely that other
City departments’ worthy bond-funded projects would be delayed or
scrapped.
To avoid waiting five years for
another bond, we must focus our efforts on ensuring that Proposition A passes
with more than two-thirds of the vote in February. SPUR recommends a “Yes” vote on Prop. A, the Recreation and
Park and Port bond.
Proposition B
“Establishing a
deferred retirement option program for members of the San Francisco Police
Department”
Police
Deferred Retirement Option
Addresses a staffing
shortage by granting retirement-age police officers both their salary and their
pension in order to keep them on the force for one to three additional years.
What it does
Proposition B is an amendment to
the San Francisco City Charter that would allow San Francisco police officers
who have served at least 25 years and who are at least 50 years of age to
participate in a deferred-retirement option program, called a DROP. A DROP is a
program that allows an employee who is eligible to retire to continue working
while simultaneously drawing a pension. In the proposed DROP program,
participating police officers would continue working at their prior salary and
benefits while the City places their monthly pension into an interest bearing
account (at 4% annual interest) that the employee accesses at the end of the
DROP.. During the DROP, the employee would not be eligible for promotion nor
would those years count towards added pension benefits.
Members of the department who have
the title of police officer would be eligible to participate for up to three
years, sergeants and inspectors for up to two years, and lieutenants and
captains for a maximum of one year. A member of the police force need not have
maxed out his or her pension eligibility prior to entering DROP. The only
officers not eligible for the DROP are those who are disabled, or who cannot
work the streets or the investigation desk. Further, if an officer became
disabled while participating in the DROP, he or she would have to leave it.
Employee participation in the DROP is entirely voluntary. They can elect to
join, and then subsequently leave the DROP at any point.
Upon entry into the DROP, the
member’s normal monthly retirement benefits and pension would be frozen
and not increased for any reason other than for cost-of-living adjustments.
These frozen benefits would be credited to a DROP account for each month of
participation in the program. All assets in the DROP account would receive an
annual effective interest rate of 4 percent.
During the DROP, the employee
would not be eligible for promotion, but would receive normal pay and regular
benefits such as health care. The participant would also be required to
contribute a portion of his or her pay — about 4 percent of salary
— into the retirement system. But those payments would not be added to
the participant’s DROP account. The City and County of San Francisco
would not be required to make contributions to the retirement system for the
DROP participant.
At the end of participation in the
DROP, the member would be considered a normal retiree of the San Francisco
Police Department. The new retiree would then receive the assets accrued in the
tax-deferred DROP account. For example, if a 55-year-old regular police officer
entered the DROP after 25 years of service while earning $100,000 annually, at
the end of three years in the DROP that officer would receive a lump sum of
$225,000,plus interest and minus taxes. The amount of lump-sum payment would be
based on the participant’s salary, the years of service, the
participant’s age and the number of years of participation in the DROP.[1] At
the termination of the DROP, the participant would have the option to have the
assets from the DROP account rolled over into a government-approved retirement
account or to receive it as a normal payout.
Leaving the DROP would constitute
retirement from the Police Department. After the employee officially retires,
he or she would then receive all normal expected pension payouts for the
remainder of his or her life. The measure does not prevent an employee from
being reinstated as a police officer again at the end of the DROP period. This
means that an employee could continue to work and enter the DROP, during which
time his retirement benefits would go into a separate account. Then the
employee could return to full service again as a police officer with full pay
and benefits and continue to receive pay raises until such time as he or she
retires again or chooses to reenter the DROP. There is nothing that would
prevent an employee from entering the DROP more than once.
Employees still pay their
contribution to the pension during the years they are in the DROP. There is the
option for the City to not make the payment into the pension account.
In a change to the governance of
pensions, the measure reduces the threshold of the number of votes on the Board
of Supervisors required to make a change to this pension ordinance, from nine
(a supermajority) to six (a simple majority). While this change does not
directly affect other pensions, it sets a precedent that would likely be
followed by other groups.
How it got on the
ballot
The Police Officers Association
paid signature-gatherers to gather sufficient signatures to place this charter
amendment onto the ballot. They submitted 65,000 signatures and incurred costs
of approximately $200,000 to gather the signatures.
As a charter amendment, six
members of the Board of Supervisors could have placed the measure onto the
ballot. According to the POA, they did not pursue that route to place onto the
ballot because they wanted more control of the final language of the measure.
If it had gone through the Board of Supervisors elements of the legislation as
written may have been modified or eliminated.
The problem the measure is seeking
to solve is the high percentage of San Francisco police officers who are
nearing retirement age, and the lack of sufficient additional experienced
officers. According to the SFPD, more than 550 police officers are expected to
reach retirement age in the next five years and there are 300 vacant police
officer positions.
The department also claims that it
is below the staffing level — 1,971 sworn officers — mandated in
the city charter, and that it has 250 positions it could fill. Yet the
department is having difficulty recruiting new officers and retaining older
veterans. Recruitment of new officers is more difficult in part because of the
strict eligibility criteria that reduces the supply of otherwise strong
candidates. Retention of veterans is a perennial problem, as many officers max
out their pensions at 30 years and then retire from San Francisco, only to
begin working again as police officers for another city, while collecting their
San Francisco retirement pension. With nearly 25 percent of the police officer
workforce facing retirement in next four years, the idea of the DROP is to
provide enough incentive for veterans to stay.
Pros
Arguments in favor of the measure:
- This
measure will create an additional incentive for experienced police
officers to remain working in San Francisco for additional years beyond
when they ordinarily would have worked. Today, many police officers retire
from San Francisco, earn their pension, and then begin working for another
police force.
- It
provides the opportunity for a police officer to continue working for a
few years while also earning a pension at the same time. Under current
rules, an employee cannot work for the City and earn a pension at the same
time. This measure changes that rule, but only for employees of the Police
Department.
- The
measure provides a financial windfall to participants, as they receive the
full accrued pension for their period in the DROP program as a lump sum
when they finish their time in the DROP.
- Relative
to other similar DROP measures throughout the United States, this one is
“pro-employer” in that it limits the number of years an
employee may continue both earning a salary and receiving a pension. For
example, Fresno allows a police officer to be in a DROP program for up to
10 years, as opposed to the three proposed for San Francisco.
- Retaining
experienced high-salaried police officers is no more costly than hiring
and training new officers. Further, because the employee in the DROP still
contributed to their retirement, the costs to the City are primarily
administrative.
Cons
Arguments against the measure:
- The
DROP program is a form of “double-dipping,” as the officer
effectively earns both a salary and a retirement pension from the same
employer. This option is not given to any other employees in City
government.
- Prop.
B is a temporary and incomplete fix that does not address a deeper
underlying problem: that we do not have enough people who are interested
in becoming police officers in San Francisco. Unless we change the charter
to no longer require a minimum number of police officers or revisit the
eligibility criteria to widen the pool of potential recruits, we will
continue to face the same problems with total numbers and recruitment.
- The
measure may not achieve its policy goal because it does not require an
officer to have maxed out his or her retirement before he or she enters
the DROP. In total, there are 580 people who meet or are projected to meet
the criteria of the DROP within the first three years. Of these, fewer
than 20 percent have maxed out their retirement, or would have over the
three years of the DROP. If the DROP is meant to be an incentive for these
people to stay on the force, isn’t the opportunity to maximize their
pension incentive enough?
- The DROP
may create a perverse incentive for some officers to enter the DROP for a
few years, retire, and then hope to get reinstated while having cashed in
a sizable nest egg — up to several hundred thousand dollars —
for the years that they were in the DROP.
- This
measure makes a change to the governance of pensions by changing the
number of votes on the 11-member Board of Supervisors required to change
pensions, dropping the threshold from a supermajority, or nine, to a
simple majority, or six. This may result in other groups of employees
seeking the same change in the governance of their own pensions. Allowing
a simple majority of the supervisors to govern pensions makes it more
likely that the board will grant increasingly generous pension benefits.
- The
measure will be costly to administer. The head of the City’s
retirement system argues that first-year costs will be approximately
$800,000 and the following year will cost $500,000. In part, the high cost
is related to the complexity of implementation and the large number of
potential recipients. Currently, the City’s retirement system
handles 1,200 retirees per year. The DROP program alone creates
eligibility for up to an additional 600 officers, nearly 50 percent of the
existing caseload of the retirement office.
- The
greatest benefit of this proposal goes to the upper end of the police
spectrum because it also applies to captains and lieutenants, who are
unlikely to be out on the streets where they are most needed.
- Keeping
the high-ranking officers in service longer could actually reduce
promotional opportunities for regular officers.
SPUR’s Analysis
The DROP program is an attempt to
slow down the rate of retirement for those at or near retirement age, by
providing an additional financial incentive to those who stay on for a year or
more. Whether the DROP is necessary to actually retain officers is unclear.
Most officers reach their maximum
pension benefits — 90 percent of wages — before they turn 55 years
old. This is because most police officers begin work before they are 25. That
means they already have an incentive to keep working for longer than 30 years,
in order to max out their pension. What the DROP does is give the individual
officer a potential financial windfall that he or she can collect, on top of
his or her salary, simply for choosing to enter the DROP for one or more years.
As the proponents argue, it gives the employee a chunk of cash that they
otherwise would not have been able to save.
The problem is that there are
other incentives in place that have yet to be tested. Recently, the City began
offering police officers a separate incentive of 4 percent of their wages for
those who work 30 years or more, as an inducement to stay on. However, no
officer has yet used this incentive. The POA argues that the City’s
incentive is “too little too late.” The DROP, in a sense, is the
POA response to the 4 percent incentive-pay proposal, and they claim it is the
level of financial “carrot” required to keep officers on the job
past their retirement age.
Even if this were true, the
arguments of the proposal’s merit would be more convincing if it came
from through the regular charter-amendment process instead of as a financed
campaign of paid signature-gathering, where there is no need for compromise or
public review.
Our concerns with the DROP are
three-fold. First, it sets a precedent for changes to pension governance that
may make it easier to modify other pensions in the future. Second, the DROP
does not address the larger structural problem of recruitment. Even the
proponents understand that the DROP is a stopgap measure that does not solve
the long-term issue of recruitment into the police force in San Francisco. The
existing set of officers cannot be a substitute for effective recruitment.
Third, it is a misuse of the
pension system. Some officers may choose to enter the DROP, then retire and
receive their cash payment, and then become reinstated to continue working
until they max out their pensions. The DROP program as written has no
restriction on making use of the DROP multiple times. This reinforces the
concern that the DROP is a form of “double-dipping.” This was not
the intended use of the pension system, which was meant to be retirement
security. In fact, all the officers hired after 1976 — all but 50 —
could all “unretire” once they have retired. Given the scarcity of
officers, it is possible that people would come back into the force until they
maximize their pensions.
While recruiting a sufficient
number of police officers to meet the required minimum remains a real problem
in San Francisco, the DROP program is not the solution. SPUR recommends a “no” vote on Prop. B.
Proposition C
“Adopting a
Policy calling for the acquisition of Alcatraz Island and the conversion of the
island into a global peace center”
Alcatraz
Global Peace Center
Proposes that San
Francisco acquire Alcatraz Island and transform it to a Global Peace Center.
What it does
Proposition C is a declaration of policy that states that
the City of San Francisco should “acquire Alcatraz from the United States
government and transform Alcatraz Island into a Global Peace Center.” The
declaration of policy is not binding on any City departments, and it would not
compel the National Park Service or the Golden Gate National Recreation Area to
turn over Alcatraz to the City of San Francisco or to any other entity.
How it got on the
ballot
The measure was placed on the ballot through signatures. The
proponents submitted approximately 18,000 signatures — more than the
required 10,500. The chief proponent is the director of the Global Peace
Foundation, who spent $30,000 with the help of two others to hire
signature-gatherers.
The idea for transforming Alcatraz goes back to 1978:
Following a “music healing experience” on Mt. Tamalpais, the
proponents had the revelation that they believed it would be desirable to
transform the island from a historic site of a former prison into a site that
incorporates domes and pyramids. Over the subsequent years, the idea evolved
and has been presented at artistic events and as part of Native American
ceremonies.
In the past year, the proponent brought the idea to the
Board of Supervisors to see if any of the supervisors were interested either in
sponsoring the measure as either legislation, or in supporting it as one of
four supervisors required to place the matter onto the ballot. The proponent
was unsuccessful in securing a co-sponsor at the Board of Supervisors, and
decided to go gather signatures instead.
Pros
Arguments in favor of the measure:
- The Bay
Area and San Francisco always have been at the forefront of ideas related
to global peace, and this measure would continue that tradition.
Cons
Arguments against the measure:
- The buildings on Alcatraz are extremely
significant historic buildings. It would be wrong to remove them for a use that
could just as easily go somewhere else. There is no logical reason to locate a
peace center on such an isolated place as Alcatraz.
- The correct place to begin a discussion about
changing Alcatraz is at the federal level, given that the City has no control
over the island. This idea should have begun there.
- Changing the use of the island could have
negative environmental repercussions. Everything must be transported to
Alcatraz via boat, including fresh water. Changing the use to one that may
increase overall visitors to the island not only could pose a threat to the
natural ecology of the island but also could cause additional emissions from
boat travel in the Bay.
- San Francisco already has a Global Peace Center
in the Presidio. There is no need for an additional and potentially competing
peace center.
- The proponents have not thought through the many
logistical and legal challenges to their proposal, as they should have done
prior to placing this measure onto the ballot. Several of the structures on
Alcatraz Island, such as the main prison block, are historic landmarks that
cannot be taken down and replaced by new buildings.
- The proposal relies on the federal government
declaring Alcatraz a surplus property and transferring ownership to the City.
This assumption misses an important federal law that suggests that prior to
considering any existing federal property abandoned, the federal government
must first consider using it to house the homeless (this is one of the reasons
that Treasure Island has housing for formerly homeless individuals).
SPUR’s Analysis
There is a long history of
interest in and contentious use of Alcatraz. The barren rock was inhabited only
by sea birds for most of its history. In 1850, the new state of California
turned it into a military base. During the Civil War it was home to war
prisoners and remained a military prison until the mid-1920s. From 1934 until
1963, Alcatraz was a maximum-security prison run by the Department of Justice.
After the prison closed, the island lay fallow.
In 1969, a group of Native
Americans took over the island in a symbolic demonstration, claiming the
property belonged to Native Americans. Part of their argument was that
abandoned federal property should be ceded back to the original owners. Various
groups of Native Americans and supporters remained on the island until removed
by federal marshals in 1971. Subsequently, Alcatraz Island became part of the
newly established Golden Gate National Recreation Area and an important tourism
destination. Each year, 1.5 million people visit Alcatraz. The revenue from
these tourists is shared between the ferry companies that bring people to the
island and the National Park Service, which manages the island.
The proposal to turn Alcatraz into
a Global Peace Center would suggest a major disruption to a current activity
which has been successful and popular for several decades. Regardless of the
merits of the idea — and we think it has few — this measure simply
will not work. The federal government will not give the island to the City of
San Francisco. The proponents should consider working with the Federal
government on incremental changes such as incorporating a statue of St. Francis
onto the island. SPUR recommends a
“No” vote on Prop. C.
State Ballot Measures
Proposition 91
“Transportation Funding
Protection Act”
Transportation Funding Restrictions
Further prevents the
governor and the state Legislature from using the money collected from fuel
taxes for non-transportation uses, even in fiscal emergencies.
What it does
Proposition 91 is an attempt to
eliminate the ability of the Governor and the state Legislature to use the
proceeds of the state gasoline sales tax and the fuel excise tax for
non-transportation uses, even during extreme fiscal emergencies. This is the
third measure in recent years to further restrict the use of transportation
funds. In 2002, voters approved Proposition 42, which initially dedicated the
gas sales tax to transportation. But the proposition contained a provision that
allowed the Legislature and the governor to divert funds to non-transportation
expenses during fiscal emergencies. Last fall’s Proposition 1A further
strengthened the dedication of gas taxes to transportation but allows the use of
these transportation funds for non-transportation uses twice in a 10-year
period so long as the “loan” to the General Fund is repaid with
interest.
Prop. 91 would make two
significant changes that would further limit the state’s ability to use
transportation funds for non-transportation purposes. First, it would eliminate
the state’s ability to transfer money from the “Transportation
Investment Fund” portion of the sales tax on gasoline to
non-transportation uses, even in a fiscal emergency (as is allowed under
existing law). Second, it would also eliminate the authority to loan monies
from the fuel excise tax to the state’s General Fund for multiple years.
It would allow some of these funds to be transferred on a short-term basis when
the state has cash-flow problems. However, those monies would have to be repaid
within 30 days of the adoption of the following year’s budget.
In a change that may affect transit funding, Prop. 91
reverses the restrictions on loans to the state’s General Fund from the
“Public Transportation Account” (which is funded also by the sales
tax on gasoline). The scope of this change remains unclear.
How it got on the
ballot
Prop. 91 is an initiative
constitutional amendment and statute that was placed on the ballot through the submission
of signatures. Oddly, its official proponents are encouraging voters to vote
“no” in February, because the proponents consider that Proposition
1A (approved by voters in November 2006) already has accomplished the
objectives they intended.
In January of 2006, the California
Alliance for Jobs, a lobbying group of construction companies, engineering
companies and labor unions began a petition drive on an initiative that
attempted to further limit the use of transportation funds for non-transportation
uses. The group referred to its initiative as a “legislative fix of Prop.
42.” The concern with Prop. 42 was that the funds allocated to
transportation in Prop. 42 were too frequently “raided” by the
state Legislature for non-transportation uses. The Alliance sought to use the
threat of its very strict measure as a bargaining tool to encourage the
Legislature to place a more moderate but effective measure onto the November
2006 ballot. The belief was that if the Legislature endorsed the measure, there
would be less political opposition.
During the first half of 2006, the
Alliance was simultaneously gathering signatures and attempting to work with
the state Legislature on a compromise measure. However, it was not until April
and May of 2006 that the Legislature appeared poised to put a compromise onto
the ballot. This was near the deadline for submission of signatures to qualify
measures for the ballot, so the Alliance submitted more than 600,000 signatures
(and claims to have withheld an additional 400,000). Then, on May 5, the
Legislature submitted a compromise measure for the November ballot —
Prop. 1A — alongside four infrastructure bonds — Propositions 1B,
1C, 1D and 1E — totaling more than $40 billion.
Although the state Legislature had
achieved what the Alliance sought, the signatures had already been submitted
and were counted. Because the number the Alliance had submitted was so close to
the minimum required, just 7,000 more than the minimum, the verification
process took a long time and the state did not officially qualify the measure
in time for the November 2006 ballot. Although 77 percent of the voters in
November 2006 approved Prop. 1A, there was no way to remove the
already-approved strict initiative — which became Prop. 91 — from
the next state ballot.
The Alliance now claims that it
wants to continue its commitment to the governor and the state Legislature to
support the Prop 1A compromise, and thus the Alliance is not campaigning for
Prop. 91. In fact, the Alliance is listed as the official proponents but it has
taken out a paid argument encouraging voters to oppose Prop. 91. There are no
proponents actively supporting Proposition 91
Pros
Arguments for this measure:
- The current law is not strict enough to protect
transportation funding. Proposition 1A still allows politicians to divert the
transportation funds to non-transportation programs during times of fiscal
crisis, thereby exacerbating the condition of streets, highways and mass
transit.
- Allowing the state to use transportation funds for
other uses drives up the cost of transportation projects, as one-year delays
can increase the price of a capital project by 10 percent or more.
- Prop. 91 would make funding for highways,
streets and roads, which are the main recipients of the gas tax, more stable on
a year-to-year basis.
- Prop. 91 does allow the gas-tax money to be
loaned to the state for short-term cash-flow challenges, but does not allow the
state to divert it for several years while transportation projects languish.
- The voters already have approved two prior
versions of laws that require gas-tax revenues to be used to improve
transportation and mass transit, and voters have a reasonable expectation that
this will happen. Diverting transportation funds to general government uses can
create voter distrust that will make it more difficult to gain voter approval
of future transportation-funding measures. Prop. 91 furthers the voters’
will by further closing the “fiscal emergency” loopholes.
Cons
Arguments against this measure:
- This
measure was meant as a political lever in 2006 to force the state
Legislature to restrict the raiding of transportation funds. It was always
intended as a threat more than as a serious policy consideration of the
best way to support transportation funding.
- The
measure we currently have — Prop. 1A, which was the result of the
political pressure exercised by the threat of the more restrictive Prop,
91 — works fine. Prop. 1A’s set-aside for transportation
spending provides sufficient protection for transportation projects, but
Prop. 91 goes too far by eliminating any discretion when there are changes
in fiscal circumstances. It is irresponsible to further tie the hands of
the governor and the Legislature to redirect spending in a crisis.
- During
a future fiscal crisis, there is likely to be increased pressure on social
services, education and other programs to bear the cost of resolving the
fiscal emergency. These services typically go to the most vulnerable
populations in the state. The cost to the state of eliminating such
programs and attempting to restart them a year or more later is
significant. Delaying most transportation projects by a year causes less
economic, fiscal and social harm. Further, the existing Prop. 1A limits
the extent to which transportation projects can be bumped during a fiscal
crisis.
- Given
the billions of dollars in approved spending on transportation projects,
there will be sufficient work for everyone in the existing transportation
and construction sectors. Therefore, there would be minimal economic harm
from any potential delays.
- Prop.
91 does not provide the same level of protection for transit funds as it
does for funds that are primarily used for roads and highways. For San
Francisco, the potential loss of transit funds is a major concern.
- State
program priorities change. It is wrong to lock spending priorities —
transportation and mass transit — into the state constitution.
SPUR’s Analysis
Despite the fact that Prop. 91 may
be effective in preventing the use of most transportation funds for
non-transportation uses, it may cause unintended consequences. In particular,
it is written in such a way as to prevent the use of the Transportation
Investment Fund by the state, but may allow Public Transportation Account funds
to be loaned to the General Fund without a restriction on when they must be
repaid. The Public Transportation Account funds are used entirely by
public-transit agencies. Therefore, Prop. 91 could have the effect of making
public-transit funding less certain.
In addition, Prop. 91 was designed
in an attempt to get the Legislature to act for the November 2006 ballot
— which it did. Even the initial proponents have not argued that Prop. 91
is the best form of legislation they could hope for. In short, Prop. 91 is a
measure that was written to solve a problem that already has been solved
through the political process. Unfortunately, Prop. 91 is now on the February
ballot and we are forced to review it on its merits. As such, we have strong
reservations and urge a “no” vote. Not only does Prop. 91 impose
too many restrictions and limit flexibility, it could disproportionately harm
public-transit funding by only allowing those funds to be loaned only to the
General Fund. In 2006 we supported Prop. 1A, the supposed fix to the practice
of raiding transportation funds. We stand by our prior endorsement. SPUR recommends a “no” vote on
Prop. 91.
Proposition 92
"Community
College Initiative Constitutional Amendment and Statute"
Community College Set Aside
Increases funding and
reduces student fees at California Community Colleges without identifying a
specific revenue source for the increase funding.
What it does
Proposition 92 makes major changes
to the California Constitution and to state laws affecting California Community
Colleges.
Among other changes, Prop. 92
would change the current set-aside for education funding required by
1988’s Proposition 98 into two separate requirements: one for K-12
schools — kindergarten through high school — and one for community
colleges, under which community colleges would receive 10.46 percent of the
education set-aside. Prop. 92 also proposes to reduce community-college
education fees from $20 per unit to $15 per unit, and significantly limits the
state’s authority to increase fees in future years. The proposition also
would establish in the state constitution an independent system of community
colleges with expanded authority and a larger state governing board.
Funding: Prop. 92 alters the state public-education funding
set-aside installed by Proposition 98, which California voters adopted in 1988.
Under Prop. 98, state K-14 education — that is, the school system from
kindergarten through two-year community colleges —is guaranteed at least
39 percent of the state’s General Fund, and that funding grows each year
based on state revenues, personal income and K-12 attendance. In only one year
did K-14 education receive as little as 39 percent of General Fund
expenditures. In recent years, these schools have received closer to 45 percent
of the General Fund. Community-college enrollment is not a factor in
determining the level of state funding for K-14 education.
Under Proposition 92, funds for
the California Community Colleges would be separated from those for K-12
schools, and community colleges would receive a minimum of about 10 percent of
the Prop. 98 school-funding pool. Overall funding would be based on demographic
and economic factors, such as the total number of residents in the state
between 17 and 25 years of age, regardless of how many of those people actually
enroll in a community college. The measure also includes an additional
provision for a funding increase in any year in which the state’s
unemployment rate exceeds 5 percent. However, the measure would cap the total
growth at no more than 5 percent in any year.
Fees: Proposition 92 sets the fees that can be charged, reducing
them from the current $20 per unit to $15 per unit. That means that a full-time
student would pay approximately $450 per year, instead of the $600 the same
student would pay today. This fee-reduction would apply to all students,
regardless of income. Today, community colleges waive the fees of many
lower-income students.
The reduction in fees would reduce
community-college system revenues by about $70 million per year. Student fees
offset less than 10 percent of system costs. Prop. 92 contains a provision for
increasing the fees, but the terms of the proposal make it unlikely that any
such increase would occur, as the increase requires high inflation, and the
permissible fee increase is rounded down to the nearest dollar.
Governance: The CCC system includes 109 colleges operated by 72
districts throughout California, serving 2.5 million students each year.
Elected boards of trustees govern each district and have autonomy to determine
course offerings, manage district property, and hire staff. At the statewide
level, there is a Board of Governors that sets standards such as minimum
graduation requirements, coordinates among the local districts and appoints a
chancellor in charge of day-to-day operations. The BOG has 17 members who are
appointed by the governor, of which five of the members are selected from lists
of people approved by specified stakeholders of the community-college
community, such as faculty and staff. The state constitution makes little
mention of the community colleges as a system, unlike its references to the
University of California and California State University systems.
Prop. 92 makes a number of changes
to governance that increase the direct power of the system. It would change the
state constitution to formally recognize the California Community Colleges
system as part of the state’s public-school system, made up of districts
governed locally. It also increases the membership of the Board of Governors to
19 and requires the state governor to appoint members to the BOG from lists
that are provided by specific community-college organizations. It removes the
power from the governor to appoint and set compensation levels for executive
officers, and turns that power over to the BOG.
Through establishing the community
colleges as a distinct system, Prop. 92 would also change the way funding is
allocated. Under Prop. 92, there would be formula to allocate funding to each
community-college district. This is a change from today, when the districts
receive funds through the state General Fund budget process.
How it got on the
ballot
The Community College League of
California, an advocacy organization for the California Community Colleges,
paid for the gathering of voter signatures to put the measure on the ballot by
initiative. The league argues that K-12 student population is decreasing in the
state in the short run while the population of young adults and potential
community-college students is increasing at a rapid rate. Under current funding
formulas, K-12 education receives the vast majority of public education funds.
Prop. 92 is meant to address shortfalls in funds for community colleges.
The Regents of the University of
California and the California State University Chancellor’s Office oppose
Prop. 92. They argue that Prop. 92 would directly hurt UC and CSU funding based
on future competition from the community-college system. All three systems draw
from the discretionary portion of the state’s General Fund, which is only
8 percent of total state spending. In recent years, student fees at the other
state higher-education systems, UC and CSU, have increased dramatically, while
Prop. 92 would reduce fees at Community Colleges.
Pros
Arguments in favor of the measure:
- California Community Colleges account for more
than 70 percent of all public higher-education enrollment in the state and
deserve additional funds to serve a growing population.
- Strengthening community colleges is vital to the
economic future of California. Post-secondary education, including the
certificates granted by community colleges, substantially increases lifetime
earnings. That, in turn, will increase overall economic growth and the tax base
for the state, yielding an ample return on the investment of additional funds
to community colleges.
- Separating the funds for community colleges from
K-12 education and basing the funding level on the population of young adults
will ensure that resources for the community colleges will reflect the
population demand for those colleges and may provide new resources to make the
schools more attractive to that population.
- This measure will increase revenue for community
colleges without directly decreasing funds for K-12 education.
- Reducing student fees could increase enrollment,
as shown by a recent reduction of fees from $26 to $20. This reflects the fact
that for most community-college students, the cost of attending is a major
consideration. In 2004, when student fees were increased, enrollment dropped by
more than 300,000 statewide.
Cons
Arguments against the measure:
- Prop. 92 is a set-aside for community colleges
that would bring the system $1 billion over three years without any specific
identified source of funds. This would put community colleges in direct competition
with other state programs, particularly public higher education — the UC
and CSU systems — that do not have their own dedicated funding stream.
This is because UC and CSU draw their budget from the discretionary portion of
the state’s General Fund, which is only 8 percent of state spending.
- The measure would increase funding to the CCC
system regardless of how many students actually are served. That is, the CCC
system would get an increase in funding based on the number of young people in
the state or the unemployment rate, not the actual number of the young people
who attend community colleges. This suggests that the system could receive
funds beyond what it needs to operate.
- This measure reduces the unit fee from $20 to
$15 for all students regardless of need, a move that reduces revenue by at
least $71 million. It also makes it highly unlikely that the fee could
increase, as it is tied to inflation but “rounds down” to the
nearest dollar. Since this would be fixed in the state constitution, this fee
could be changed only by a vote of the people.
- The changes in governance do not solve any
current problems, and as part of a constitutional measure the changes would be
difficult to reverse. It would diminish the governor’s authority to name
members of the Board of Governors. This seems to be a power play by the
Community College League, which represents local boards of trustees but not the
statewide Board of Governors.
- While all set-asides decrease the discretion of
elected officials to determine budgetary priorities and are fiscally
irresponsible, Prop. 92 does not adhere to any principles for responsible
budget set-asides. The measure identifies no new funding source to accompany
the set-aside, has no time limit or sunset clause, and does not require the
California Community Colleges to meet any specific outcomes.
SPUR’s analysis
Prop. 92 is a measure that uses
popular policies such as reduced fees and increased revenues as a carrot for
garnering greater political support among all segments in the California
Community College system. However, it has proven to be politically unpopular
with other segments of education, particularly California State University and
University of California systems, as it is perceived as increasing competition
for a shrinking source of funding for public higher education.
The measure is fiscally
irresponsible because it not only reduces revenue to the community-college
system, through a fee reduction, but also sets aside a higher portion of
overall education funds to community colleges without identifying any new
funding sources. This will inevitably result in cuts to other areas of
education, particularly public higher education. In recent years, students at
both CSU and UC systems have shouldered massive increases in fees. While
community colleges are often the first step for many to enter a CSU or UC
school, the pathway to higher education for one system should not place greater
fiscal strain on another. The lack of support from these institutions is
evidence that the politics of Prop. 92 focused on securing support internally
from community colleges and ignored other historic “allies.”
While SPUR believes that community
colleges are fundamental to our state’s economy and promise of
opportunity, we see this measure as flawed. It is troubling for us to be so
critical of a measure that will result in a larger number of students attending
community colleges and thus increasing their skills and earning potential. We
just don’t think this ought to be done on the backs of other priorities
in the state particularly as the state faces a $14 billion budget deficit.
Tying the hands of legislative bodies is the popular way to win victories for
one’s priorities, and SPUR even has proposed some of our own that do
this. The difference with this measure is that it does not identify a funding
source for this new set-aside. We would hope that the California Community
College system would rethink this measure and return with one that builds more
grassroots support across the many advocates of education and economic
opportunity. SPUR recommends a
“no” vote on Prop. 92.
Proposition 93:
“Term Limits and Legislative Reform
Act”
State Term Limit modification
Proposition 93 would change the
state’s term-limits law by shortening the overall amount of time a
legislator may serve to 12 years, but would allow members to serve that time in
either house of the Legislature.
What it does
Currently, the California Constitution limits the number of terms that
elected Assembly members and senators may serve in the Legislature. An
individual may serve no more than three two-year terms in the Assembly and no
more than two four-year terms in the Senate. Therefore, a legislator generally
may not serve more than a total of 14 years in the Legislature. An exception is
when an individual serves additional time by finishing out less than one-half
of another person’s term.
Under the proposed measure, an individual would be allowed to serve no
more than a total of 12 years in the Legislature. However, these years could be
served without regard to whether the years were served in the Assembly or the
Senate, in contrast to current law. In other words, an individual could serve
six two-year terms in the Assembly, three four-year terms in the Senate, or
some combination of terms in both houses, of no more than 12 years total. As
under current law, an individual could serve additional time by finishing out
less than one-half of another person’s term.
Under the measure, Assembly
members and Senators in office at the time the initiative was passed would be
allowed to serve up to a total of 12 years in their current legislative house,
regardless of how many years were already served in the other house.
How it got on the
ballot
In 1990, California voters approved Proposition 140, which limited the
terms that state legislators may hold in office. Despite a few attempts to
amend the law, most recently with Proposition 45 in 2002, the law’s
provisions have remained unchanged since originally enacted. Because voters
approved term limits by passing a ballot initiative, the law’s provisions
may be amended only by ballot initiative.
A few studies have found that while the public is somewhat critical of
the term-limits law, most people take an attitude of “amend it, not end
it.” Reports from Public Policy Institute of California and the
California Constitution Revision Commission have suggested that the number of
years an elected official may remain in office should be extended allow an Assembly
member or Senator to stay longer in one house. The PPIC called for the limit to
be 14 years.
Prop. 93 was placed on the ballot
through the submission of voter signatures. Financial supporters include the
California Teachers Association and the Service Employees International Union.
Other endorsing supporters include the California Business Roundtable.
Pros
Arguments in favor
of this measure:
- Several academic and public policy
groups have studied the effects of California’s term-limit laws and
determined that the state would benefit from changing the current system.
This proposal is based in part on a recent nonpartisan study conducted
through the Public Policy Institute of California, though the PPIC does
not endorse initiatives and has not endorsed Prop. 93.
- The state faces many complex and very
important public-policy issues. It takes years to craft legislation to
address these issues. Additionally, it takes time for a legislator to
develop enough experience and policy expertise to properly deal with these
issues.
- As a result of the current term
limits, lobbyists are the ones that have the policy expertise, and they
exert more control in the legislative process than they should. Some
lobbyists try for years to get officials to carry bills favorable to the
lobbyists’ clients, and they are able to more easily persuade
politicians who lack experience.
- This measure would allow legislators
to engage in more long-range planning as well as to do a better job of
providing oversight over the executive branch.
- This proposal provides for more
flexibility in the state’s existing term-limits rules, reduces the
politicians’ need to jump from one body to the next to further their
participation in the Legislature and therefore makes the system more
stable and more able to properly deal with the important issues facing the
state.
- Prop. 93 is a balanced solution that
helps retain talented leaders as well as a healthy turnover in the
Legislature.
Cons
Arguments against
this measure:
- Current
law lowers the barriers to run for elective office, bringing into the process
people who too often have been overwhelmed by the powers of incumbency.
- In
California, there are very few competitive elections — largely because
the incumbents control redistricting. The state needs to reform its redistricting
process first before allowing incumbents to stay in office longer. If districts
were no longer gerrymandered, elections would be more competitive and there
would no longer be a need for term limits.
- While
the general goal of this initiative may be worthwhile, Prop. 93 is unfair
because it contains a large loophole permitting 42 otherwise termed-out
incumbents to remain in office. In fact, the original draft of the legislation
was changed to allow existing legislators more time in office. While this
revision was a direct response to comply with legal concerns regarding
constitutional equal-protection issues, it comes across as a cynical attempt by
some incumbent politicians to hold onto power.
- Politicians’
primary reason for supporting this measure is to avoid the competition for
office that the current term-limits law encourages.
- If
what Prop. 93 proponents are saying about the negative affects of California
term limits is true (that is, that it promotes a lack of experience and
expertise), one should not support this measure because it actually reduces the
number of years an individual may be in office, from 14 to 12. Even the PPIC
study from which Prop 93 is said to be partially based wanted the permissible
number of years in office to be not lower than 14.
- The
proponents’ position that this measure is needed to provide the state
with more experienced legislators and to encourage longer-range planning is
undermined by the fact that this measure actually reduces the number of years a
legislator may be in office.
- The “Yes on 93” campaign is financed
largely by groups that have business in front of the politicians who have the
most to gain from its passage.
SPUR’s Analysis
The benefits of Prop 93, as drafted, are mixed. Providing more
flexibility in the way the current term-limits law is structured would promote
better long-range planning, more experience and more expertise on the part of
the legislators, and would help them address the important issues facing the
state. This is particularly true given the complexity of issues facing
California.
However, by reducing the total number of years a person may remain in
the Legislature, this measure may force certain legislators to exit the state
Legislature in fewer years than previously required. For example, if Prop. 93
passes and Assemblyman Mark Leno wins the seat in the state Senate for which he
is running, he would be able to stay in the Senate only for one term because of
his prior years in the Assembly. Under current rules, he would be able to serve
two terms in the Senate. Additionally, the Legislature has failed to address
some of the underlining reasons for term limits, which are to provide for fair
redistricting and to make elections more competitive.
While Prop. 93 does not offer the fullest of reforms of the term-limits
system and it was not combined with a redistricting change, it is an important
initial step toward reform. Passing Prop. 93 is important to demonstrate broad
support for modifying a system of term limits that has negatively affected
long-term thinking in our state. SPUR
recommends a “yes” vote on Prop. 93.
