"For the Kids" – Comprehensive Review of California School Bonds, Executive Summary (Section 1 of 9)
See the complete California Policy Center report For the Kids: California Voters Must Become Wary of Borrowing Billions More from Wealthy Investors for Educational Construction (complete, printable PDF Version, 4 MB, 361 pages)
Links to all sections of this study readable online:
You are Here: Executive Summary: “For the Kids” – Comprehensive Review of California School Bonds (1 of 9)
More Borrowing for California Educational Construction in 2016 (2 of 9)
Quantifying and Explaining California’s Educational Construction Debt (3 of 9)
How California School and College Districts Acquire and Manage Debt (4 of 9)
Capital Appreciation Bonds: Disturbing Repayment Terms (5 of 9)
Tricks of the Trade: Questionable Behavior with Bonds (6 of 9)
The System Is Skewed to Pass Bond Measures (7 of 9)
More Trouble with Bond Finance for Educational Construction (8 of 9)
Improving Oversight, Accountability, and Fiscal Responsibility (9 of 9)
Guide to all Tables and Appendices – Comprehensive Reference for Researchers
Executive Summary
Few Californians realize how much debt they’ve imposed on future generations with their votes for bond measures meant to fund the construction of new and modernized school facilities.
From 2001 to 2014, California voters considered 1147 ballot measures proposed by K-12 school districts and community college districts to borrow money for construction via bond sales. Voters approved 911 of these bond measures, giving 642 school and college districts authority to borrow a total of $110.4 billion.
California voters also approved three statewide ballot measures during that time to authorize the state to borrow $35.8 billion. That money has supplemented local borrowing for construction projects at school and college districts, and the state has spent all but $195 million of it.
That’s a total of $146.1 billion authorized during the last 14 years for state and local educational districts to obtain and spend on construction projects. All of it has been borrowed or will be borrowed from wealthy investors, who buy state and local government bonds as a relatively safe investment that generates tax-exempt income through interest payments.
Current and future generations of Californians are already committed to paying these investors about $200 billion in principal and interest — a number that will grow as school and college districts continue to borrow by selling bonds already authorized by voters but not yet sold.
And more borrowing is coming.
In 2016 California voters may be asked to authorize the state to borrow as much as $9 billion for school construction. More than 100 school and college districts may ask voters to approve borrowing a total of several billion more dollars. Officials at the country’s second largest school district, the Los Angeles Unified School District, claim they need more than $40 billion for additional construction and plan to ask voters to approve borrowing several billion in 2016.
It is time to be wary. The California Policy Center believes that most Californians are unaware and uninformed about this relentless borrowing and the amount of debt already accumulated to pay for school construction. Most voters cannot explain how a bond measure works and do not get enough information to make an educated decision about the wisdom of a bond measure.
California voters who want to learn more before voting will have difficulty finding relevant information. Where does an ordinary Californian find out how much money a school or college district has already been authorized to borrow from past bond measures, or the principal and interest owed from past bond sales that still needs to be repaid, or the projected changes in assessed property valuation and how they affect tax and debt limits, or the past and projected student enrollment? The state does not offer a clearinghouse of information for the public to research and compare data about bond measures and bond debt for educational districts. Much of the information available about debt finance for educational districts is oriented toward interests of bond investors rather than people who pay the debt.
Californians who recognize a need for their own local educational districts to refrain from accumulating additional debt have significant obstacles to overcome. State law gives supporters of bond measures a systematic strategic advantage when local districts develop bond measures and put them before voters for approval. Campaigns to support bond measures are funded and even managed by financial and construction industry interests that will profit after passage. And after voters approve a bond measure, educational districts are tempted to take advantage of ambiguities in state law and use bond proceeds for items and activities not typically regarded by the public as construction.
To help to fix these deficiencies, this report encourages the California legislature and the executive branch to adopt five sets of recommendations:
| Five Categories of Recommendations | |
|---|---|
| 1 | Provide Adequate and Effective Oversight and Accountability for Bond Measures |
| 2 | Enable Voters to Make a Reasonably Informed Decision on Bond Measures |
| 3 | Eliminate or Mitigate Conflicts of Interest in Contracting Related to Bond Measures |
| 4 | Reduce Inappropriate, Excessive, or Unnecessary Spending of Bond Proceeds |
| 5 | Improve Understanding of Bond Measures Through Public Education Campaigns |
At a time of low interest rates, California school and community college districts may benefit in some circumstances from borrowing money to fund school construction, just like households benefit from home mortgages and car loans. But California voters — and their elected representatives — need to become much more informed about the debt legacy they are leaving to their children and grandchildren.
Emotional sentiment, lobbying pressure from interest groups, and eagerness to circumvent frustrating tax and debt limits in state law can overwhelm a prudent sense of caution. Irrational decisions that burden future generations cannot necessarily be fixed after the public finds out about them.
Section Summaries
Section 2. Why This Report Matters: More Borrowing in 2016
Californians will be asked in 2016 to continue taking on debt for construction of educational facilities, but one elected official is leery. Governor Jerry Brown wants to change the funding system for school construction. He is concerned about debt that Californians have accumulated from years of allowing the state and local educational districts to relentlessly borrow.
That money borrowed through bond sales will have to be paid back — with interest — to the investors who bought them. Voters have limited understanding of bonds and how bonds provide funds for construction, and elections focus on what voters will get rather than how they will pay for it. To the detriment of future generations, few Californians realize the huge amount educational districts have been authorized to borrow and the huge amount of debt accumulated.
Section 3. Quantifying and Explaining California’s Educational Construction Debt
Whatever voters are asked to approve in 2016 will not launch a new program to fix long-neglected schools to serve a rapidly expanding state population while providing smaller class sizes. That thinking is a legacy of the 1990s that seems to endure today despite 14 years of most bond measures passing at a 55 percent threshold for voter approval. Arguments for another state bond measure in 2016 ignore or downplay how local school and college districts and the state obtained authority in the past 14 years to borrow $146.1 billion for educational construction.
If voters are not told or reminded of recent borrowing patterns, how can they make an informed decision on future borrowing? To rectify the lack of availability of statistics on total bond debt in California for educational facility construction, the California Policy Center collected, synthesized, and analyzed data regarding California educational construction finance. 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.
Section 4. How Educational Districts Acquire and Manage Debt
It’s likely that most California voters have limited familiarity with the organization and governance of their local school and community college districts. When voters authorize their local educational districts to borrow money for construction by selling bonds, presumably they trust that the local school or college district will exercise prudence in managing the process. Sometimes their trust is betrayed.
To discourage abuse of the school construction finance system, voters need to be aware of how their local government is organized and managed. They also need to realize that state law does not explicitly give Independent Citizens’ Bond Oversight Committees broad authority to review construction programs funded by bond measures.
How can voters become informed about bonds and the process of borrowing money for educational construction through bond sales? Is there a way to explain in clear plain language what actually happens after voters approve a bond measure and authorize a school or college district to borrow money via bond sales?
Section 5. Capital Appreciation Bonds: Disturbing Repayment Terms
In 1993, California law was changed so that school and college districts could use an innovative form of debt finance called zero-coupon bonds, also known as Capital Appreciation Bonds. These bonds allow school and college districts to borrow now for construction and pay it back — with compounded interest — many years later. The borrowing strategy has been a tempting and dangerous lure for elected school and college boards.
Some people think Capital Appreciation Bonds are a “ticking time bomb” or the “creation of a toxic waste dump.” Others regard critics as uninformed and contend that these debt finance instruments are beneficial for school and college districts. Since the people who will be paying off many of these Capital Appreciation Bonds are now children or not even born yet, there isn’t much incentive to stop the flow of borrowed money that doesn’t need to be paid back for a generation or two.
Section 6. Tricks of the Trade: Questionable Behavior with Bonds
Californians who want more spending on educational construction often express their resentment of a 2000 law limiting taxes and debt resulting from bond sales. It was passed in order to strengthen campaign arguments to voters in support of Proposition 39, which lowered the approval threshold for local bond measures from two-thirds to 55%. School districts have adopted several strategies to get around these limits in state law. One of them is very obscure but 100% successful: obtaining waivers from the State Board of Education.
Meanwhile, some districts are stretching legal definitions to use proceeds from bond sales to pay for items that resemble instructional material more than construction. One example is personal portable electronics such as iPads. Some of the state’s largest districts are purchasing this kind of technology while giving little assurance to the public that long term bonds aren’t the source of the money. This equipment may be obsolete well before the bonds mature, meaning that future generations will pay for these devices long after they are outdated and discarded.
Section 7. The System Is Skewed to Pass Bond Measures
Considering the advantages that supporters have in preparing and campaigning for a bond measure, perhaps it’s noteworthy that voters reject about 20% of local bond measures for educational construction. At every stage of the process, interests that will benefit from bond sales can take advantage of a system that favors passage of a bond measure. Some issues of concern include use of public funds to develop campaigns to pass bond measures, significant political contributions to campaigns from interests likely to benefit from construction, involvement of college foundations as intermediaries for campaign contributions, and conflicts of interest and alleged pay-to-play contracts.
Section 8. More Trouble with Bond Finance for Educational Construction
While compiling the comprehensive information provided in this study, California Policy Center researchers identified numerous other troubling aspects of bond finance. School and college districts are evading compliance with the law and making irresponsible decisions. Ordinary voters lack enough data to make an informed vote. Community activists who seek deeper understanding find themselves stymied.
Section 9. Improving Oversight, Accountability, and Fiscal Responsibility
This report encourages the California legislature and the executive branch to adopt five sets of recommendations that will help to fix these deficiencies.
| Five Categories of Recommendations | |
|---|---|
| 1 | Provide Adequate and Effective Oversight and Accountability for Bond Measures |
| 2 | Enable Voters to Make a Reasonably Informed Decision on Bond Measures |
| 3 | Eliminate or Mitigate Conflicts of Interest in Contracting Related to Bond Measures |
| 4 | Reduce Inappropriate, Excessive, or Unnecessary Spending of Bond Proceeds |
| 5 | Improve Understanding of Bond Measures Through Public Education Campaigns |
The California Policy Center rejects the idea that additional oversight and accountability isn’t needed or desirable. Some legislative reforms and education programs (both public and private) can overcome voter cynicism, frustration, apathy, and ignorance.
Tables and Appendices of “For the Kids: California Voters Must Become Wary…”
Tables A1 to A6
Table A-1 California K-12 School Districts 2013-2014 – Ranked by Enrollment
Table A-2 California Community College District Enrollment Fall 2014 Ranked by Number of Students
Table A-4 California School Construction & Finance History
Table A-5 Arguments for Capital Appreciation Bonds
Table A-6 Arguments Against Capital Appreciation Bonds
Appendices A to L
Appendix E – All California Educational Bond Measures 55 Percent – 2001-2014
###
Thank you for the effort you have made to inform the public on this important subject. Your analyses are clear and allow an interested person to explore a complicated subject which is typically promoted by emotion rather than common sense. Citizens’ oversight committees are too often made up of people who are rubberstamps and offer no critical analysis. Many ideas you put forth are also found in The Better Way Initiative; we just need to get more people to become informed. The circular back-scratching groups that are involved in most school bonds waste millions of taxpayers’ dollars.
Turned out to be an incredible resource everyone involved should be proud of. Good Job 🙂
[url=http://love.mr2.space/][img]https://encrypted-tbn3.gstatic.com/images?q=tbn:ANd9GcRwr-ctUm8aRjWNAMDcslrSnubY1sjsZHhBJtJZaLtTvVImGGK2ww[/img][/url]
Потому призываем вас быть всегда во всеоружии и постоянно совершенствоватьсвои навыки
[URL=http://love.noov.ru]сайт знакомств сочи без регистрации +и бесплатно[/URL]
знакомства без регистрации +с фото
Не забывайте следить, какимипутами вас опутывает избранница
buy viagra melbourne australia, order viagra mexico, where to buy viagra from
cheap viagra buy uk, buy viagra uk cheap
[url=http://mensmedstoresildenafil.org/#order]Viagra Generic[/url] viagra sale uk online
buy viagra online from uk, cheap viagra canada pharmacy
viagra sale vegas, how to buy viagra at boots
excellent website [url=http://lls-online.biz/]http://lls-online.biz/[/url]
Good morning!
Low to $1.89 for Christmas Gifts,Enjoy the Peace Joy Lking to pass the time while waiting for company? Pick up a quick-fix casual game, enjoy viral videos from the many entertainment apps or socialize and surf the internet.
I am unsure if you simply missed my messages, but i wi try once more. samsung galaxy help and support
[url=http://kilamo.info/lumia-phone-no-sound/]lumia phone no sound[/url] blue book it february
3ghz octa-core mediatek 6753 processor with 3gb of ram.
Dont know if its bn said but cba to read a the messages, you dont nd a mobile to receive a text for that to aow line to work.
Tags:
chinese smartphone android 4
asus zenfone 2 e samsung galaxy s6
[url=http://kilamo.info/bluboo-touch-your-people/]bluboo touch your people[/url]
iman s1 pro circuit
galaxy note 7 japan release date
aeku m5 mini doberman
[url=http://kilamo.info/lumia-how-to-update-to-lumia-denim/]lumia how to update to lumia denim[/url]
cubot x axis bleach
bluboo edge 4g lte 5?7
zte android 5 1 manual
[url=http://kilamo.info/nokia-lumia-theme-song/]nokia lumia theme song[/url]
honor 8 bumper vents
oukitel u20 plus international medical center
htc one m9 vs lg g4
lego elite 5 with scupper
[url=http://kilamo.info/huawei-mate-12-signs/]huawei mate 12 signs[/url]
buy smartphone from manufacturer
buy huawei p8q77 m2 ktrmr
bluboo picasso 4g 800
[url=http://kilamo.info/zte-axon-vs-jetta/]zte axon vs jetta[/url]
cubot echo dual sim usa
zte axon 4g 4mp
doogee dg 280 edgewater
[url=http://kilamo.info/bluboo-edge-4g-lte-routers/]bluboo edge 4g lte routers[/url]
gionee elife e7 in gsmarena
kelly blue book rv and boats
The arm itself is adjustable t, so you can swivel it into the perfect position for you, and it holds your phone securely without vibrating or wiggling around.
The image resolutionmeasured in megapixelsof a smartphone’s front camera.
[url=http://moto159.ru]купить детский квадроцикл[/url]
Позвольте вас приветствовать.
комфорт своих гостей. [url=http://spay.ichiya-boshi.net/otel/sitemap.html]гостиницы в г новосибирск[/url] Очень полезный сайтик! [url=http://cute.sh/hotelmotel/index.html]гостиницы в соколе[/url] коттеджей в зоне отдыха. [url=http://spay.iaigiri.com/otel/index.html]гостевой дом фантази витязево[/url] Комфорт 2-х комнатная квартира класса люкс с отдельным входом в части второго этажа [url=http://motelotel.netne.net]забронировать хостел в берлине[/url] Отзывы помогли мне решить, потери отеля могут, но некоторые этого не делают. [url=http://spay.futene.net/otel/index.html]адлер гостевой дом солнечный берег[/url] Например, если вы мечтаете посетить Pammukale – исторические и природные заповедники, в частности, [url=http://spay.hariko.com/otel/index.html]гостевой дом фаро судак[/url]
И не забудьте проверить уровень безопасности визита на отдыхе. [url=http://motelotel.site90.com/sitemap.html]самые дешевые гостиницы крыма[/url]
До встречи.
http://405.bbls.pl
Started untrodden spider’s web predict
go apps for android best stores for android best games in android app store all htc android free adult games xxx
http://sexyapps.erolove.in/?leaf.jaquelin
all latest android mobiles android apps telegram top game android download emoji for android phone best flirting sites
We are glad to see you in our midst I want to cum in my pussy then fuck me my nickname (Alinka39)
[url=http://tourspaine.ru/?u=4cl82kk&o=8t4kazw&t=]<>[/url]
erikaparty.top/?u=4cl82kk&o=8t4kazw&t=
[url=http://tourspaine.ru/?u=4cl82kk&o=8t4kazw&t=][img]http://img-host.org.ua/thumbs/582c39a8cc96b.jpg[/img][/url]
buy amiodarone comments http://buyamiodarone100mgquickshipping.snack.ws
New kick ass photo blog
http://hotties.pictures.erolove.in/?post-jaclyn
gay zshare bhavana sex nude photos vidios of naked ladis having sex phone websites for free porn downloading star testing release questions
белые — Шаблоны WordPress. Скачать бесплатно премиум шаблон Вордпресс [url=http://ruwordpress.ru/tag/belye/]Click here>>>[/url]
Because the pool of students who apply to UC is different every year, the level of academic performance necessary for admission to a particular campus or major is different, too. Acceptance rates depend on the number of applicants, their academic qualifications and the spaces we have available.
I am the Phantom Menace