How Much Have California Voters Recently Authorized to Borrow for School Construction?

Next year California voters may be asked to authorize the State of California to borrow another $9 billion to help K-12 school and community college districts pay for more educational construction. This $9 billion would be obtained by selling bonds to investors and paying it back – with interest – over several decades using the state’s general fund.

Polling has allowed the backers of this initiative to identify the most effective arguments for winning support among voters. Those arguments are listed as “findings and declarations” in the language of the bond measure itself. (See the Request for Title and Summary for Proposed Initiative.) They are cited in various opinion pieces that have appeared in newspapers. And the arguments are heard in the promotional patter of professional signature gatherers at shopping centers.

Most of the arguments are platitudes, facts presented without context, or anecdotes. And no one would know from the arguments that California voters have already approved borrowing about $150 billion in recent years for educational construction.

Voters have approved borrowing about $150 billion for California school construction since Prop 39 passed in 2000. This virtually unknown fact is worthy of highlighting in future public debates.

Recognizing that a lack of balanced factual information compromises the democratic process, the California Policy Center continues to collect, synthesize, and analyze data regarding California educational construction finance. “It’s for the kids and the veterans” is no longer sufficient information for voters considering authorization for the state to borrow another $9 billion.

The State of California alone has $56.7 billion in debt service accumulated from the last three statewide educational bond measures that authorized borrowing a total of $35,766,000,000. Community college districts and K-12 school districts have accumulated an additional $137 billion in debt service. The public needs to know what has already happened before deciding what will happen next.

Part of that understanding includes the impact of Proposition 39. Prop 39 inaugurated a new era of generous borrowing for educational construction in California. Approved by 53.4% of voters in the November 7, 2000 election, it reduced the voter approval threshold for educational construction bond measures (under certain conditions) from two-thirds to 55 percent.

This lowered obstacle encouraged local educational districts to take the risk of proposing many more bond measures at much higher amounts for voters to approve. As shown by the data below, dropping the voter threshold from 66.67% to 55% transformed the approval of educational bond measures from a 50-50 chance to a commonplace outcome.

The California Policy Center believes it is the first and only entity to painstakingly research and present an accurate and comprehensive record of all state and local educational construction bond measures considered by voters from 2001 through 2014.

Some Facts on Voter Consideration of Local and State Bond Measures for Educational Construction

See Appendix A – All California Educational Bond Measures Considered by Voters Since November 2000 Enactment of Proposition 39 – Ranked by Percentage of Voter Approval

See Appendix F – All California Educational Bond Measures Repurposed or Reauthorized Since November 2000 Enactment of Proposition 39 – Listed by Election Year

1. Since the passage of Proposition 39, voters in California have been asked 1147 times to authorize local K-12 school districts and community college districts to borrow a total of $124,350,056,744 for educational construction.

2. Of those 1147 bond measures, sixteen (16) were to reauthorize already approved bond authority totaling $730,365,000. If those bond measures are included with the 1131 bond measures to authorize new borrowing authority, the total amount California voters have been asked to authorize or reauthorize is $125,080,421,744.

In most of these 16 cases, school districts reauthorized bond measures during the late 2000s-early 2010s decline in assessed property values in order to circumvent tax and debt limits in state law and allow the further sales of bonds. These reauthorizations were usually depicted in a simple way to voters as continuing an already-approved construction program without increasing debt.

3. Since the passage of Proposition 39, voters in California have been asked three (3) times to authorize the state to borrow a total of $35,766,000,000 for educational construction.

4. What are the grand totals? Since the passage of Proposition 39, voters in California have been asked to authorize the State of California and local K-12 school districts and community college districts to borrow $160,116,056,744 for educational construction. If reauthorized bond authority is added to that amount, the total amount voters have been asked to authorize or reauthorize is $160,846,421,744. (That is $160.8 billion.)

Some Facts on Approval of Local and State Bond Measures for Educational Construction

See Appendix B – All California Educational Bond Measures Approved by Voters Since November 2000 Enactment of Proposition 39 – Ranked by Amount Authorized to Borrow

1. Voters approved 911 of the 1147 local educational bond measures, for a 79.42% approval rate for bond measures.

2. Voters approved $109,620,418,737 out of the $124,350,056,744 proposed to voters, for a 88.15% approval rate for the amount of bond authority.

The amount of authority approved by voters is a higher percentage than the number of bond measures approved by voters because larger bond measures proposed by larger educational districts passed at a higher rate than smaller bond measures proposed by smaller districts.

3. Voters approved all sixteen (16) bond measures (among the 1147 bond measures) to reauthorize bond authority that voters had already approved in early elections. If reauthorized bond authority is included, voters approved $110,350,783,737 out of the $125,080,421,744 proposed to voters, for a 88.22% approval rate for the amount of bond authority.

4. Voters approved all three (3) statewide educational bond measures, for a total of $35,766,000,000 to match with local educational bond expenditures.

5. What are the grand totals? Since the passage of Proposition 39, voters in California have authorized the State of California and local K-12 school districts and community college districts to borrow a grand total of $145,386,418,737 for educational construction. If reauthorized bond authority is added to that amount, the total amount voters have authorized or reauthorized is $146,116,783,737.

Some Facts on Rejection of Local and State Bond Measures for Educational Construction

See Appendix C – All California Educational Bond Measures Rejected by Voters Since November 2000 Enactment of Proposition 39 – Ranked by Amount NOT Authorized to Borrow

1. Voters rejected 236 of the 1147 local educational bond measures, for a 20.6% rejection rate for bond measures.

2. Voters rejected $14,729,638,007 out of the $124,350,056,744 proposed to voters, for a 11.85% rejection rate for bond authority. If reauthorization of bond authority is added to the amount proposed to voters, the rejection rate for bond authority is 11.78%.

The amount of authority rejected by voters is a lower percentage than the number of bond measures rejected by voters because, as noted above, larger bond measures proposed by larger educational districts passed at a higher rate than smaller bond measures proposed by smaller districts.

3. Of the 236 rejected local educational bond measures, 56 needed two-thirds voter approval and 180 needed 55% voter approval.

The 55% Voter Threshold Instituted by Proposition 39 Makes a Big Difference in Approving Bond Measures

See Appendix D – All California Educational Bond Measures Approved With a Two-Thirds Threshold Since November 2000 Enactment of Proposition 39 – Listed By Election Year

See Appendix E – All California Educational Bond Measures Approved With a 55 Percent Threshold Since November 2000 Enactment of Proposition 39 – Ranked by Percentage of Voter Approval

See Appendix G – All California Educational Bond Measures Approved by Voters Under 55% Threshold Since November 2000 Enactment of Proposition 39 – Results if Proposition 39 Had Not Been Law

See Appendix H – All California Educational Bond Measures Approved by Voters Under 55% Threshold Since November 2000 Enactment of Proposition 39 – Failures Under Two-Thirds Threshold

1. A cumulative approval percentage of 60.8% is calculated by dividing the total number of Yes votes by the total number of recorded votes for all 1147 local educational bond measures and the three state bond measures since Proposition 39 was enacted. Obviously 60.8% is higher than 55% and lower than two-thirds.

2. Of the 911 local educational bond measures approved by voters, 857 were approved with a 55% threshold and 54 were approved with a two-thirds (66.67%) threshold. Most of these bond measures under the two-thirds threshold were approved in 2001 and 2002, during the first two years after voters approved Proposition 39. Since the November 2008 election, voters have only approved two local bond measures for educational construction under the two-thirds threshold. In 2014 elections, only one bond measure was subject to two-thirds voter approval (a bond measure for Vallejo City Unified School District that failed because it received only 61.5% voter approval.)

The few educational districts that now propose bond measures that require two-thirds approval instead of 55% approval do so only to evade certain requirements in Proposition 39 or in state law. A common motivation is avoiding legislative requirements imposed in the California Education Code that limit the amount of bonds issued as a percentage of total assessed property value of the district and limit the amount of tax required to pay off the debt from the bond measure.

12. If the 857 bond measures approved under a 55% threshold were considered under the old Proposition 13 two-thirds threshold in place before Proposition 39, only 369 of the 857 local educational bond measures approved by voters would have passed, while 488 of those bond measures would have failed. Those 488 bond measures authorized educational districts to borrow $57,628,510,725.

1147 Local Educational Bond Measures: Results If Proposition 39 Wasn’t Law

Under Prop 39

If Prop 39 Not Enacted

Total Number of Bond Measures on Ballot

1147

1147

Total Amount Authorized to Borrow on Ballot (includes reauthorizations)

$125,070,421,744

$125,070,421,744

Number of Bond Measures Approved

911

423

Percentage of Bond Measures Approved

79.42%

36.88%

Total Amount Authorized to Borrow

$110,340,783,737

$52,712,273,012

Percentage of Bond Authorization Amount Approved

88.22%

42.15%

Comparison of Election Results: 55 Percent versus Two-Thirds Voter Approval

55% Approval Under Prop 39

Two-Thirds Approval

Total

Number of Bond Measures on Ballot

1037

110

1147

Number of Bond Measures Approved

857

54

911

Number of Bond Measures Rejected

180

56

236

Percentage of Bond Measures Approved

82.64%

49.09%

79.42%

Percentage of Bond Measures Rejected

17.36%

50.91%

20.58%

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