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When is a political campaign neither political nor a campaign?

California law prohibits government officials from using taxpayer dollars “for the purpose of urging the support or defeat of any ballot measure.” But on February 13, in the meeting room of the Santa Ana Unified School District, school officials revealed a political campaign that began with shaping public opinion and will end in November with a district-wide vote on a bond measure that will cost residents hundreds of millions of dollars.

The SAUSD Song Remains the Same

1999: Kelly Rowland, LaTavia Roberson, Beyonce Knowles and LeToya Luckett, of Destiny’s Child, perform at the Woodlands Pavilion at Jump Jam. Santa Ana Unified was asking taxpayers to pay its unplayable bills. (AP Photo/Houston Chronicle, Steve Campbell)

It’s 1999, and Bill Clinton is one year removed from his affair with Monica Lewinsky becoming public. Destiny’s Child is a hit with its single “Bills, Bills, Bills,” and the San Antonio Spurs have won the NBA championship. Meanwhile, the Santa Ana Unified School District (SAUSD) is proposing a $145 million bond measure to fund the construction of 13 new schools, replace portables with permanent classrooms, and renovate facilities.

The measure passed. A few years later, it was revealed the district hadspent $450 million building just five schools instead of the 13 promised.

Flash forward to 2008. The New York Giants beat the undefeated Patriots, Katy Perry is on top of bubblegum radio with the hit single “I Kissed a Girl,” Barack Obama becomes the first African American president – and SAUSD is pushing forward yet another bond, Measure G.

Almost a mirror image of Measure C, that bond was also successful. An independent auditor says Measure G funds were handled more responsibly than Measure Cfunds. But there’s still this weirdness: The $200 million generated by Measure G targeted precisely the same problems that were supposed to have been corrected under Measure C – the replacement of portable classrooms with permanent buildings, and implementing upgrades to facilities throughout the district. Both bonds won’t be paid off until 2040. That’s three more decades of higher taxes.

Now it’s 2018. Donald Trump is president, the Houston Astros are the defending World Series champs – and there’s another SAUSD bond measure. Depending on which day you talk to district officials, the proposed November 2018 bond measure would raise either $479 million, $518 million or, most recently, $232 million. The purpose of this new bond? You guessed it: fix deteriorating roofs, upgrade older schools, and, yes, replace portable classrooms with permanent ones.

In 19 years, SAUSD has proposed three bonds at a cost of more than a billion dollars (counting interest) – and is still unable to fix those portables or maintain its other facilities. At the same time, they have told state officials their facilities (the very facilities they say are in need of an upgrade) are good or even exemplary. In the meantime, government union-backed trustees have ignored official warnings of a looming financial crisis.

The country has changed so much since 1999, but not the SAUSD. There’s clearly a problem in Santa Ana that more tax dollars won’t fix.

Kelly McGee is a Rhodes College graduate and a journalism intern at California Policy Center.

The perilous state of Santa Ana schools

Class conflict: Santa Ana schools are spending more and more on fewer students. (U.S. Air Force file photo)

School officials in California’s sixth-largest school district are working overtime to promote a massive $1.2 billion bond tentatively scheduled for a districtwide vote in November. Yet behind their chatter about improving Santa Ana Unified facilities is a stark fact: Student enrollment there has been falling steadily for over 15 years. And declining enrollment means declining revenue from federal, state and local sources – about $10,000 per student. But at the same time, district spending, particularly on teacher salaries and benefits, has been rising. Where those two trends intersect – falling revenue, rising costs– is crisis.

Just last summer, the crisis claimed its first victims when the district declared it would have to lay off 287 teachers. The same teacher’s union that had pushed for the pay increases that precipitated the crisis helpfully provided district officials with the hit list – all of it based on one metric only: the last hired were the first fired.

But the crisis didn’t begin in 2017. An SAUSD demographer’s 2016 report illustrates a steady decline in SAUSD enrollment starting in 2003. That year, total student enrollment was 60,973. By 2012, enrollment had fallen to 53,493. This equates to an approximately 12% drop in enrollment and a $75 million loss in revenue. Long-range projections through this school year predict that the decline will continue.

As recently as June 26th — school trustees backed by the powerful teaches union approved regular annual salary increases. In addition to this most recent salary increase, teacher salaries were also raised from 2013-2015.

Losing cash, union-backed trustees ordered district staff to find a solution. Facilities maintenance was delayed. Major renovations were impossible. And so they settled on the November bond.

A bond is basically an IOU — the district’s promise that it will repay Wall Street lenders interest on a multi-million-dollar loan. District officials first pegged the amount of the loan at $479 million – enough, they said, to repair damage created by time and mismanagement. But in the past few weeks the amount of the bond has fluctuated from $518 million back down to $232 million. Neither figure includes interest payments on the loan, which will more than double its cost.

Santa Ana Unified hasn’t even finished paying off two existing loans, from 1999 and 2008. They should be paid off by 2040. By that time, last month’s graduates will be about 40 years old, some with children of their own attending Santa Ana schools that will boast well-paid adults, falling test scores, failing infrastructure – and perhaps still laboring beneath hundreds of millions of dollars in repayments on the Great Bond of 2018.

Kelly McGee is a Rhodes College graduate and a journalism intern at California Policy Center.

 

 

Construction Firms Fund Orange County School Bond Campaigns

Companies linked to the school construction industry have placed their November bets on a number of Orange County school bond ballot measures, a California Policy Center investigation of campaign contribution reports collected by the Orange County Registrar of Voters show.

frequentcontributors

Atkinson, Andelson, Loya, Rudd & Romo (AALRR) is a law firm with eight offices across California. AALRR has donated $2000 to Anaheim Elementary School District’s bond measure, $12,000 to Orange Unified School District and $1000 to Fountain Valley School District. AALRR claims to represent nearly half the school districts in California and has previously represented both districts.

Bernards Builders Management Services is a general contractor located in San Fernando. Bernards has donated $2000 to Anaheim Elementary’s bond measure and $5000 to Brea-Olinda Unified School District’s measure. Bernards has worked with Brea-Olinda before on the Brea-Olinda High School and Olinda Elementary School. The subcontracted architecture firm for the Brea projects, LPA, has donated $10,000 this election cycle to Orange’s bond measure.

Ledesma & Meyer Construction Company Inc (LMCCI), located in Rancho Cucamonga, is a construction firm that proclaims to have completed “over a billion dollars of public works and K-12 school district projects.” LMCCI previously contracted with Ocean View Unified School District on asbestos removal projects amounting to over $3.4 million. Ocean View USD has a $148 million bond measure this fall and among their proposed projects is additional asbestos removal. LMCCI has contributed $25,000 in support of Ocean View USD’s measure. LMCCI has also contributed $5000 to Anaheim Elementary bond measures.

Pocock Design Solutions, Inc. is a Tustin-based full service design firm. Pocock has completed design projects for both new construction and modernization in over 60 schools districts in California. Pocock has donated $1500 each to the Anaheim Elementary and Ocean View Unified School District bond measures.

All firms worked throughout Southern California on previous school construction projects.

ocmeasures

In addition to this election cycle, California Policy Center examined contributions in 2014 made by construction firms to two incumbent Orange USD board members. Vanir Construction Management, a general contractor with offices throughout the Southwestern United States, contributed $1000 each to Timothy Surridge and Rick Ledesma. In addition, Arcadis, a design and consultancy firm, contributed $2000 to Rick Ledesma. Both Ledesma and Surridge voted in favor placing Measure S before voters in Orange USD this fall.

There’s of course no guarantee any of these firms will win lucrative contracts associated with new funding from the ballot measures. California State Public Contract Code Section 100 requires local governments to offer all businesses “a fair opportunity to enter the bidding process, thereby stimulating competition in a manner conducive to sound fiscal practices” in order to “eliminate favoritism, fraud, and corruption in the awarding of public contracts.”

But concern about what some state officials call “pay to play” campaign contributions has risen. California State Treasurer John Chiang issued a press release in July on the subject of pay-to-play, specifically addressing bond underwriters.

“Preying on school districts eager to win voter approval for bond elections, municipal finance firms, including bond counsel, underwriters, and financial advisors, are offering to fund or provide campaign services in exchange for contracts to issue the bonds, once approved by voters,” Chiang warned.

The concern about pay-to-play is not limited to underwriters. The California Building Industry Association has donated over $1,500,000 to Proposition 51, a statewide measure that would allow the state of California to issue $9 million in bonds for the State School Facilities Fund. The builders are the second-largest contributor in support of the proposition.

Andrew Heritage is a California Policy Center fall Journalism Fellow. He is a doctoral student in political science at the Claremont Graduate University.

School District's Bond Controversy Reveals Rising Concern About 'Pay-to-Play'

Vital force.

CUSD’s Kirsten Vital 

In the space of just a few months, state officials have suddenly turned their attention to a problem in the public-educational shadows: insider dealing among California school district officials and outside vendors.

In a January opinion, state Attorney General Kamala Harris concluded that school officials had become too cozy with companies that stand to benefit from passage of high-ticket school bonds.

“A school or community college district violates California constitutional and statutory prohibitions against using public funds to advocate passage of a bond measure by contracting with a person or entity for services related to a bond election campaign if the pre-election services may be fairly characterized as campaign activity,” Harris wrote.

In July, California Treasurer John Chiang warned districts about the same problem. And in August, Gov. Jerry Brown signed into law AB 2116, creating financial oversight committees for the spending of bond revenue.

Despite the scrutiny, companies looking to do business with the Capistrano Unified School District are major contributors to the district’s massive $889 million bond, Measure M on the November ballot.

Contributors include construction, engineering and architecture firms. Documents first published by Dawn Urbanek, a South County activist, show Tilden-Coil Constructors gave $25,000; $15,000 came from WLC Architects; computer giant Dell gave $4,000 to the effort.

Some of the contributors have already worked for the district. WLC Architects designed the Capistrano Valley High School Performing Arts Center. School officials approved five payments to WCL Architects (total: $43,781.03) during a September 14 meeting.  

At the center of the controversy: CUSD’s top administrator, Superintendent Kirsten Vital.

Vital ran into similar trouble at her job in the Alameda Unified School District. Her highest-profile collision in Alameda involved an Oakland-based political consulting firm with multiple ties to the district. That firm worked for Vital to promote the district’s Measure H Bond in 2008. The next year, the school board appointed the firm’s two partners to a Master Plan Advisory Group that year. That same year, Vital paid the firm $14,000 for “design and programming of AUSD website redesign.” In the same year, Vital created a webmaster position and hired AUSD Board Trustee Mike McMahon’s daughter Rebecca McMahon to fill the position. Her salary, depending on tenure, ranged from $41,000 to $51,000 per year.

At the same time, Vital faced a series of pay cuts in Alameda. She earned $273,908 in 2012; dropped to $262,823 in 2013, and to $214,031 in 2014. In three years her pay dropped 22%.

Interestingly, Joseph M. Farley, her predecessor at CUSD, rode a more dramatic financial downhill. Documents provided by Transparent California show Farley earning $287,073 in 2013. In 2014, he made just $203,773, a one-year drop of 29%.

 

vitalsalary-2

 

Vital’s original CUSD 2014-2018 contract gave her an annual salary of $305,000 – a huge bump over her Alameda salary (and Farley’s in CUSD). She also received a $15,000 relocation assistance stipend. That four-year deal was amended after just two years, in 2016. The new contract, extended through 2020, gave her an annual salary of $319,244 and another bonus, this one a $14,244 “discretionary payment.”

Conor McGarry is a graduate of California State University–Dominguez Hills, and a Journalism Fellow at California Policy Center.

 

For Nov. 8th: $32B in Local Borrowing, $2.9B in Local Tax Increases

New local taxes and new local borrowing are a regular phenomenon in California elections, but this year our government union controlled politicians have outdone themselves. Let’s compare:

November 2014 – $11 billion in new borrowing proposed via 118 local bond measures, 81% passed. Of the 117 local proposals for new taxes, 68% passed.

June 2016 – $6.2 billion in new borrowing proposed via 48 local bond measures, an estimated 93% passed. Of the 42 local proposals for new taxes, an estimated 66% passed.

November 2016 – $32.2 billion in new borrowing via 193 local bond measures, and 224 local proposals for new taxes!

Not only do these general and primary and special election tax and bond measures accumulate year after year, but they nearly always pass! The primary source for this information is the California Tax Foundation, who have just produced another excellent guide “Local Tax and Bond Measures 2016.” This time, they have not only compiled a list of all of the proposed local taxes and bonds, but for each of the proposed new local taxes, they have compiled the projected annual collections. The result is stunning.

2016 California Local Tax and Bond Measures
20160927-uw-local-taxes

As this table reports, $32.2 billion in new borrowing is being proposed, nearly all of it for schools and colleges. At 5.0% annual interest with a 30 year repayment plan, this borrowing will cost property owners another $2.0 billion per year in increased property taxes. If over 90% of these bonds are approved by voters, as recent history indicates is likely, California’s taxpayers will suddenly have saddled themselves with nearly $30 billion in new government debt.

Also as reported on the above table, the 224 proposed tax increases are estimated to cost taxpayers at least $2.9 billion per year. “At least,” because CalTax was unable to find revenue projections for 29 of them. And while “sin taxes” on marijuana and soda promise to bring in $58 million and $18 million, respectively, it is sales tax, that everyone pays, that will bring in most of the revenue, over $2.3 billion.

Because local taxes are numerous and dispersed onto hundreds of differing ballots across the state, they don’t get the visibility that state tax increases generate. But collectively they are just as significant. California’s Prop. 30, passed by voters in 2012, generated about $6.0 billion per year. That same tax, which was supposed to be temporary, will be extended through 2030 if voters approve Prop. 55 this year. But if you compare this statewide tax to the proposed local taxes, $2.9 billion per year, along with required payments on the local bonds, $2.1 billion per year, you are adding another $5.0 billion annual burden to taxpayers.

Passing Prop. 30 was a major fight. Similarly, Prop. 55 has huge visibility with voters. But because nearly all of the local measures pass, and because dozens if not hundreds of them appear on the ballot every election, local taxes and bonds matter more. Invisible, ongoing, and ever expanding, they are silently elevating the cost-of-living for ordinary Californians as much or more than state taxes.

Where does this money really go? Why is there an insatiable thirst for more taxes and more borrowed funds?

One word:  Pensions. One cause:  Government unions and their allies in the financial community, who together comprise what is by far the most potent political lobby in California.

A May 2016 analysis by the California Policy Center, using the most recent data available from the U.S. Census Bureau, estimated that during 2014, California’s 80+ independent state/local government employee pension systems received $30.1 billion in contributions (ref. table 2-A). Later in that same report, on table 2-C which is displayed below, one can see how much these pension systems actually need to remain financially healthy. At a minimum, they are collecting $8.0 billion per year LESS than they need. And that is if the investments they’ve made yield an annual return of 7.5% per year for the next 30 years. At the modest reduction of that projection to 6.5% – which even CalPERS has announced they are going to phase in as their new projection for calculating required annual contributions, these pension systems are collecting $22.2 billion per year LESS than they need.

California State/Local Pension Funds Consolidated
2014 – Est. Funding Status and Required Contributions at Various ROI

20160516-CPC-Ring-pension-liabilities

If California’s state and local government workers participated in Social Security like the rest of California’s workers, instead of receiving guaranteed defined benefit pensions that on average pay FOUR TIMES what Social Security recipients can expect, there would be no insatiable need for more money for the pension systems. Even if California’s state and local government workers merely received defined benefits that paid, on average, TWICE what Social Security recipients can expect, these pension funds would currently have surpluses. Moreover, there would be money left over in local municipal and school district operating budgets to maintain facilities, instead of having to perpetually borrow.

Six billion per year ala Prop. 30 and Prop. 55. Another five billion per year thanks to new proposed local taxes and borrowing just this November. And it’s not even close to enough. California’s state and local government pension systems are going to need somewhere between $50 to $60 billion per year to stay afloat, and currently they’re collecting barely more than half that much.

No wonder there’s the perennial scramble for more. More. MORE.

 *   *   *

Ed Ring is the president of the California Policy Center.

Reporter's Notebook: CPC Offers Expert Help with Local School Bond Reporting

For Immediate Release
September 23, 2016
California Policy Center
Contact: Will Swaim
Will@CalPolicyCenter.org
(714) 573-2231

SACRAMENTO, Calif. — Well down the November ballot, obscured by the high-profile battle for the White House, Californians will find more than 100 local school bond measures representing hundreds of millions of dollars of new public debt.

“The bond process is like a rigged game of high-stakes poker,” says CPC president Ed Ring. “Taxpayers may have a seat at the table, but for years haven’t stood a chance against politicians, government union leaders, construction companies and investors colluding for political and financial gain.”

The California Policy Center’s government finance experts can help you show readers why these bond measures matter.

ED RING is president of the California Policy Center. He directs the organization’s research projects and is also the editor of the email newsletters Prosperity Digest and UnionWatch Digest. His work has been cited in the Los Angeles Times, Sacramento Bee, Wall Street Journal, Forbes, and other national and regional publications.

MARC JOFFE is a California Policy Center financial analyst. His research has been published by the California State Treasurer’s Office, the Mercatus Center and the Macdonald-Laurier Institute among others. Before starting PSCS, Marc was a senior director at Moody’s Analytics. He earned his MBA from New York University and his MPA from San Francisco State University.

KEVIN DAYTON authored the landmark study “For the Kids: California voters must become wary of borrowing billions from wealthy investors for educational construction.” That study tracked passage over 14 years of more than 900 California school bonds worth $146.1 billion, and inspired new law (AB 2116, signed this summer by Gov. Jerry Brown) that imposes limits and oversight of local bonds. He is a 1992 graduate of Yale University.

ABOUT THE CALIFORNIA POLICY
The California Policy Center is a non-partisan public policy think tank providing information that elevates the public dialogue on vital issues facing Californians, with the goal of helping to foster constructive progress towards more equitable and sustainable management of California’s public institutions. Learn more at CaliforniaPolicyCenter.org.

 

Down Ballot Measures Could Cost You Big Bucks

Election month is rapidly approaching. That’s right, “election month” because, since 2002, California voters have been freed from casting ballots in person on the official Election Day, which this year is November 8. Voting by mail begins October 10.

Polls show that many voters are disenchanted with the coming election because the major candidates for president are held in such low esteem. However, whether you are a strong advocate for a candidate or are disillusioned, it would be a huge mistake to ignore the ballot measures. Besides candidates, voters must decide on 17 state propositions and hundreds of local tax and bond measures designed to dip into taxpayers’ wallets.

A number of the state measures will impact taxpayers. Proposition 55 is an extension of California’s highest state income tax rate in the nation, which was sold as “temporary” when approved by voters in 2012. Proposition 56 would increase tobacco taxes to fund ongoing programs that will demand funding, even when the number of smokers declines. Proposition 53 is also important as it would expand taxpayers’ right to vote on major state bonds for mega-projects costing more than $2 billion.

To help voters make informed decisions, the Howard Jarvis Taxpayers Association has created a special website, California Initiatives 2016, which has simple summaries of what the 17 initiatives will do and links to the websites of the sponsors and opponents of each measure. This helpful taxpayer tool can be found at http://cainitiatives2016.com.

However, for average citizens, the real pocket gougers will appear on local ballots. These include 184 school bonds with a face value of over $25 billion. The actual cost to taxpayers of these bonds, which place a lien on property to guarantee repayment, is more than double face value after interest is included.

Remember, whether or not voters think these local bonds are justified, taxpayers are entitled to good value for each hard earned tax dollar. This determination can best be made by researching the measure as well as the school district’s record of responding to the needs of students, parents and taxpayers. A complete list of these local school construction bonds can be found at http://www.bigbadbonds.com.

Taxpayer advocate Richard Michael, who maintains a bond tracking website, reminds us that promoters of these bonds are enamored with the following words to convince you to vote yes: “21st century;” “school improvement;” “college and career ready;” “technology;” “leaking roofs;” “asbestos;” “safety systems;” “aging facilities;” etc. To this list we would add “broken toilets,” a favorite with the Los Angeles Unified School District that managed to push through 5 bonds in a period of 13 years. The almost universal use of these words is unlikely a coincidence, since so many bond backers employ the same consultants who make recommendations on how to frame arguments to increase the chances of passage.

School bonds, of course are not the only tax measures that will appear on local ballots. There are other bonds, parcel taxes, sales taxes and utility user taxes to be voted on throughout California. For example, Bay Area voters are facing a $3.5 billion BART bond and Los Angeles County will decide on an additional half-cent sales tax to support the MTA that is suffering declining ridership. All of these local measures need careful scrutiny.

While voters can still wait until the traditional “first Tuesday after the first Monday” in November to vote in person, if you have done your homework and want to share what you have learned with family, friends, neighbors and contacts, don’t wait. In the November 2014 election, more than 60 percent of California voters cast votes by mail. Information on how to be a smart voter will not help anyone who has already cast their ballot.

Jon Coupal is president of the Howard Jarvis Taxpayers Association — California’s largest grass-roots taxpayer organization, dedicated to the protection of Proposition 13 and the advancement of taxpayers’ rights.

Gov. Brown says yes to school finance reforms inspired by CPC study

For Immediate Release
August 18, 2016
California Policy Center
Contact: Will Swaim
Will@CalPolicyCenter.org
(714) 573-2231

SACRAMENTO — It’s rare that a think-tank study produces real reform, but it happened today when Gov. Jerry Brown signed into law a bill designed to stop school officials before they recklessly spend again.

Assembly Bill 2116 began one year ago with a July 2015 California Policy Center study.

For the Kids: California voters must become wary of borrowing billions from wealthy investors for educational construction,” by CPC researcher Kevin Dayton, tracked passage over 14 years of more than 900 California school bonds worth $146.1 billion.

Inspired by that CPC study, Rep. James Gallagher (R-Sacramento Valley) drafted a bill to limit the ability of school districts to take on debt through new bonds – even authorizing county auditors to stop spending if bond “funds are not being spent appropriately.”

“I am pleased that the governor saw the need to increase oversight of school bonds,” Gallagher said in a press release. “Borrowing for bonds has exploded in the last decade, and it is more important than ever that school construction bond funds be fiscally sound and their financing mechanisms transparent.”

In addition to waste and abuse in the management of those school bonds, Dayton found another problem: the surge in school bond debt has produced a massive “wealth shift” upward – from taxpayers of relatively modest means to “wealthy investors who buy state and local government bonds as a relatively safe investment that generates tax-exempt income through interest payments.”

Gallagher’s bill implements California Policy Center recommendations to kill one of the most pernicious municipal finance practices. The new law limits the ability of bond advisers to exaggerate property values when calculating the taxpayer burden.

“We dedicated tremendous resources to producing this study, and we were naturally pleased to see Rep. Gallagher act on it with such energy,” said Ed Ring, CPC’s president. “We’re especially delighted that the state’s school kids have been placed ahead of the interests of consultants, government unions, politicians and Wall Street banking interests.”

“It’s great to see intellectual research and analysis turn into practical improvements in law,” said Dayton.

ABOUT ANALYST KEVIN DAYTON
Kevin Dayton is a policy analyst for the California Policy Center, an influential writer, and the author of frequent postings about generally unreported California state and local policy issues on the California Policy Center’s Prosperity Forum and Union Watch, as well as on his own website LaborIssuesSolutions.com. Dayton is a 1992 graduate of Yale University. Follow him on Twitter at @DaytonPubPolicy.

ABOUT THE CALIFORNIA POLICY CENTER
The California Policy Center is a non-partisan public policy think tank providing information that elevates the public dialogue on vital issues facing Californians, with the goal of helping to foster constructive progress towards more equitable and sustainable management of California’s public institutions. Learn more at CaliforniaPolicyCenter.org.

Citing CPC study, new Assembly bill seeks to stop runaway school bond debt

For Immediate Release
March 24, 2016
California Policy Center
Contact: Will Swaim
Will@CalPolicyCenter.org
(949) 274-1911

SACRAMENTO — A California Assemblyman hopes to stop school officials before they recklessly spend again.

AB 2116 author Rep. James Gallagher (R-Sacramento Valley) says his bill would limit the ability of school districts to take on debt through new bonds – even authorizing county auditors to stop spending if bond “funds are not being spent appropriately.”

“Borrowing for school construction has exploded in the last decade,” Gallagher said.“As borrowing hits record highs, it is more important than ever that school construction bond funds be fiscally sound, and their financing mechanisms transparent.

“AB 2116 ensures that future school construction bonds are subject to stricter scrutiny and transparency.”

Gallagher said his Assembly bill is built on research and recommendations in a July 2015 California Policy Center study.

“For the Kids: California voters must become wary of borrowing billions from wealthy investors for educational construction,” by CPC researcher Kevin Dayton, tracked passage over 14 years of more than 900 California school bonds worth $146.1 billion.

In addition to waste and abuse in the management of those school bonds, Dayton found another problem: the surge in school bond debt has produced a massive wealth shift upward – from taxpayers of relatively modest means to “wealthy investors who buy state and local government bonds as a relatively safe investment that generates tax-exempt income through interest payments.”

Gallagher’s bill would implement three of the California Policy Center’s recommendations – requiring independent audits of a bond’s drain on local tax revenue; establishing annual reviews of bond issuing and repayment; and empowering auditors to halt spending that is inconsistent with the bond’s purpose.

The bill will be heard April 6 at 1:30 pm in the Assembly Education Committee of the California State Capitol, Room 2116.

ABOUT ANALYST KEVIN DAYTON
Kevin Dayton is a policy analyst for the California Policy Center, a prolific writer, and the author of frequent postings about generally unreported California state and local policy issues on the California Policy Center’s Prosperity Forum and Union Watch, as well as on his own website www.LaborIssuesSolutions.com. His other policy reports include Legacy Issues: The Citizens for California High-Speed Rail Accountability 2014 Business Plan for the California High-Speed Passenger Train System and four editions of Are Charter Cities Taking Advantage of State-Mandated Construction Wage Rate (“Prevailing Wage”) Exemptions? — a publication that sparked high-profile policy debates in cities throughout California and in the state legislature. His 2003 journal article “Labor History in Public Schools: Unions Get ’Em While They’re Young,” endures as the leading critical analysis of that movement. Dayton is a 1992 graduate of Yale University. Follow him on Twitter at @DaytonPubPolicy.

ABOUT THE CALIFORNIA POLICY CENTER
The California Policy Center is a non-partisan public policy think tank providing information that elevates the public dialogue on vital issues facing Californians, with the goal of helping to foster constructive progress towards more equitable and sustainable management of California’s public institutions. Learn more at CaliforniaPolicyCenter.org.