HomeMy WebLinkAbout05/17/1988, C-8 - PROPOSITION 74, THE DEDDEH TRANSPORTATION BOND ACT OF 1988 city of San tins OBISpo
i COUNCIL AGENDA REPORT
The $300 million for local projects will be allocated as a grant
program. The state match cannot exceed 50% of the project cost and
could be less. An eligible project must: 1) increase the capacity of
highway, road or railway transit; or 2) start new service to new areas
(new construction) ; or 3) rehabilitate existing streets or roads
(extend the life of the road) . Projects must also meet the following
criteria: 1) not be receiving any other state funds, and 2) the local
agency must be prepared to award contracts no later than June 30,
1991. All applications for funds must be made by June 30, 1989. If
the state's share of eligible projects exceeds $300 million, CalTrans
is directed to prorate the state's share so that all eligible projects
can be funded and would receive the same ratio of state-local share.
ANALYSIS
The Deddeh Transportation Bond Act began as SB 140, introduced last
year and resulting from an agreement between the Governor and
legislative leadership. The Bill was approved (to be placed on the
ballot) by the Assembly Transportation Committee, but with a lukewarm
reception. The Assembly Ways and Means Committee reluctantly passed
the bill on to the Assembly floor.
There was bipartisan criticism of this proposal revolving around the
following major issues:
1) This bond initiative provides only $1 billion while the state's
immediate transportation needs are closer to $2.6 billion and are
expected to approach $20 billion by the year 2000;
2) This bill would be the 1st time in California history that debt
financing (as opposed to user tax revenues) has been used to provide
transportation services. There is concern that this approach could
lead to fiscal problems in future years;
3) The requirement for local matching funds will eliminate
participation by many cities.
The bill also has some technical problems. The League of Cities finds
the most prominent to be a provision which establishes the state (as
opposed to local governments) as first draw if the Gann transportation
(Prop 71) initiative passes.
SUPPORT
The League of Cities has voted to support Proposition 74, however they
have expressed reservations due to the requirements that local agencies
provide matching funds. The bill is also supported by Governor
Deukmejian and by Tom Hawthorne, the Chairman of the California
Transportation Commission.
The argument in favor of the bill is that California has the best
highway system in the world and proposition 74 will provide necessary
funds to maintain it. Transportation needs are critical now, and
although bonds have not been used to finance transportation in the
past, they have successfully been used for other projects.
C—19-2e
��i�uIOIIIIIIfl��I�u����U city of san lues oBispo
i COUNCIL AGENDA REPORT
OPPOSITION
The San Luis Obispo/Santa Barbara Area Managers Group wrote a letter to
the Governor in March, 1988 (copy of letter and answer attached) to
request a veto of SB 140 which placed Proposition 74 on the ballot.
Their reasons were that bonded indebtedness is not a valid way to
finance transportation systems. A gasoline tax increase would be
preferred and more appropriate, because the user of the service is then
the bearer of the financial burden. The group agreed that additional
revenues are necessary, however disagreed with the approach of Prop 74.
The opposition includes former governor Edmund G. "Pat" Brown and
Speaker pro Tempore Mike Roos of the State Assembly. They argue that
this bond initiative will create the most expensive road projects in
history including more than $2 billion in debt service. In addition to
increasing the cost of highway improvements, the bond falls short of
meeting the needs of the state by approximately $1.6 billion.
Resorting to a bond initiative that will at best patch the problem is a
"band-aide" approach that will in the long run create a worse problem
than California now faces.
ALTERNATIVES
1. Council may adopt a resolution opposing Proposition 74.
2. Council may adopt a resolution supporting Proposition 74.
3. Council may take no action regarding Proposition 74.
FISCAL IMPACT
There is no direct fiscal impact to the city. By increasing the amount
the state borrows, this measure may cause the state and local
governments to pay more under other bond programs. If the city were to
apply for and receive a grant, it would then assume the costs
associated with its portion of the project.
RECOMMENDATION
This bond act would benefit large metropolitan areas that can afford to
buy into the state grant programs. It would be of little assistance to
smaller cities such as ours. The higher bond costs, the potential loss
of redirected transportation revenues if the Gann Transportation act
passes, and the lack of provisions or guarantees that rural areas would
receive a fair portion of the benefits provided by the bill in line
with the costs they would absorb are all negative impacts. Therefore,
staff recommends Council adopt a resolution opposing Proposition 74.
Attachments: Resolution Opposing Proposition 74
Resolution Supporting Proposition 74
Proposition 74
Letter of opposition from SIA/Snt Barb. Area Managers
Letter of support from Gov. Deukmejian
C-g3
RESOLUTION NO. (1988 SERIES)
A RESOLUTION OF THE COUNCIL OF THE CITY OF SAN LUIS OBISPO
URGING THE DEFEAT OF PROPOSITION 74,
THE DEDDEH TRANSPORTATION BOND ACT,
BY THE VOTING PUBLIC OF CALIFORNIA
WHEREAS, California has historically financed its transportation
system from user tax revenues; and
WHEREAS, Proposition 74 authorizes a bond issuance to provide $1
billion dollars for use to improve and maintain the transportation
system; and
WHEREAS, this bond initiative would fall approximately $1.6
billion dollars short of meeting the needs of the transportation
system; and
WHEREAS, bonded indebtedness is an overly expensive way of
financing the transportation, with an expected additional cost of $2
billion dollars in debt service charges; and
WHEREAS, general bond such as Proposition 74 authorizes unfairly
burdens those taxpayers who do not use the transportation system;
NOW, THEREFORE, be it resolved that the Council of the City of
San Luis Obispo opposes the Deddeh Transportation Bond Act, Proposition
74, and urges its defeat by the voters of California.
On the motion of , seconded by ,
and on the following roll call vote:
AYES:
NOES:
ABSENT:
the foregoing resolution was passed and adopted this day of
1988.
Mayor Ron Dunin
ATTEST:
City Clerk Pamela Voges
Approved:
1 y A anis ra ive Officer ,(moi y A to4py
CIV
RESOLUTION NO. (1988 SERIES)
A RESOLUTION OF THE COUNCIL OF THE CITY OF SAN LUIS OBISPO
URGING THE PASSAGE OF PROPOSITION 74,
THE DEDDEH TRANSPORTATION BOND ACT,
BY THE VOTING PUBLIC OF CALIFORNIA
WHEREAS, California has the best transportation system in the
United States; and
WHEREAS, in order to maintain this transportation system
additional funds are necessary; and
WHEREAS, Proposition 74 authorizes a bond issuance to provide $1
billion dollars for use to improve and maintain the transportation
system;
NOW, THEREFORE, be it resolved that the Council of the City of
San Luis Obispo supports the Deddeh Transportation Bond Act,
Proposition 74, and urges its passage by the voters of California.
On the motion of , seconded by ,
and on the following roll call vote:
AYES:
NOES:
ABSENT:
the foregoing resolution was passed and adopted this day of
1988.
ATTEST: Mayor Ron Dunin
City Clerk Pamela Voges
Approved: —
City A lnlstrative Officer ity At rney
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l 74
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Deddeh Transp• , Ortation'Boad Act
tfie Attorney.General
Official Title and SammayWyk.-
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DEDDEH TRANSPORTATION BOND ACT A t-d fMa bond issue of one bu�ilcn dopers
to provide finds forcapitai improvemeab:f;a,,'.streets and raade:state.highv Y16 aod:emdudwe publiC?m
guideways,
F-mal Vote Cast by the Legislature on SB 140 (Proposition 74).
Assembly:Ayes 54 Senate:Ayes 27
Noes 14 Noes 7
Analysis by the Legislative Analyst
Background Capital improvements include project design, land pur-
California finances its transportation system with a chases and construction activities. General obligation
combination of federal,state and local money.Historical- bonds are backed by the state,meaning that the state will
its taring power to assure that enough money is
ly,most of this money has come from taxes and fees paid use
For example, state funds available to pay off the bonds.The state will use General
by those who use the system
Fund revenues to pay the principal and interest costs of
come from a tax of 9 cents per gallon on motor vehicle the bonds. General Fund revenues are derived primarily
fuels—mainly gasoline and diesel fuel. The state.also from the state corporate and personal income taxes and
collects truck weight fees.These tax and fee revenues are the state sales tax
used for state highways, rail transit projects, and local The bond money would supplement other state and
streets and roads, as follows. federal transportation moneys. All these funds would be
State Highway and Rail Transit. About half of the applied toward target levels of transportation activities
revenues from the motor vehicle fuel tax and all of the established in current law. These target levels include:
revenues from truck weight fees are used for state (1) $1 billion annually to expand the state's highway
purposes.In 198849,these revenues will amount to about system, (2) $75 million annually for rail transit projects,
$1 billion. The state will use these funds to (1) design, and (3) $15 million annually for highway soundwall
build and maintain state highways, (2) match federal (noise abatement) projects. In addition,the bond money
funds to build new and reconstruct existing highways, could be used to provide$300 million in 199MI.to match
and (3) fund rail transit projects. In recent years, state local funds to improve certain state highways,local roads,
funds have not grown enough to keep pace with demands or rail transit projects.
for transportation improvements. As a result, the state's Fiscal
ability to finance highway and rail transit capital im- z
provements has been reduced. Direct Costs of Paying Off the Bonds. The state ,
Local Streets and Roads. The other half of state fuel would make principal and interest payments on these
tax revenues is used by cities and counties for local streets bonds from the state's General Fund over a period of t
and roads. In 1988-89, these funds will total about $600 about 20 years. Assuming all of the authorized bonds are z
million. In addition,counties can impose,if approved by sold at an interest rate of 7.5 percent, the cost would be f
the voters, a local sales tan of up to 1 percent for about$1.8 billion to pay off both the principal ($1 billion)
transportation purposes. At present, four counties have and interest (about $790 million)- The average payment
for principal and interest would be about$90 million per
adopted a V perceIIt sales tax for transportation. Several
other counties are requesting voter approval for a similar year-
tax at this June election. Borrowing costs for Other Bonds. By increasing the
Counties also can impose a per-gallon tax on motor amount which the state borrows,this measure may cause
vehicle fuels, in 1-cent increments, for transportation the state and local governments to pay more under other
uses, when the tax is approved by the voters. So far, no bond programs. These costs cannot be estimated.
State Revenues. The people who buy these bonds are
county has adopted such a tax
not required to.pay state income tax on the interest they i.
Proposal earn. Therefore, if Cahfbrnia taxpayers buy these bonds
This measure authorizes the state-to sell $1 billion of instead of making other taxable investments,'the state
o
general obligation bonds for capital improvements on would collect less taxes. This loss of.revenue cannot be ,
state highways, rail transit, and local streets and roads estimated
P
P88
36
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OdBd LtW s
This law pxopased by Stotts BE 14D.(Stamtm of 1998. (3t 8!) ia, 2712 (a) 71hs Troruporiation rntproveheant Finanoi CowenU fit
submitted to the people to a000nknee with the provisions of llrtlde' Ee ry cmtad,ldbr orf.tbie cbspfsr, ths:•,TiansporRatioss lar.
RVI of the Comtltutiam proaement Finanve mitkr es'Yhs cvmm/t�e'as that hrm is saw
-This;sopused law.adds seeftom to the9theetrsaid'EBOWayr('ade; in with Section l��PartObl�nDla Band
w�oo�jthe(�oernew
4.
therefore,aero paoviaoos ptopoaed to be added,aro printed m italic .n Code _21»coetmitAteconsiabofehe 7reasan�tlhsDlseetor Fhsassat
type to indimw that they we now. do�-
die Director of Trwisportatim awndd Lieutenant
%�P06W-1 AW .. :- %_, _.,.. Governor,oreftNdesignated i rpnonsa m.;ft Tressn wabdl affer
as chairperson of the twmmitim A ma)osity of 4%&cemmifiee sterract
SEG 17.' 17 (sa ng with Section 8700) is added to for sits committee
Division 3 of the Streets ad Highways Cade.to no (b) Forof the State.Cenool-Obitudsha Bund Lmz� it
lietr/a 17. Dtttwtta 7AaNsa'oMA7fiDN Boivn ACr
Department oThistrpordatiort isdev/gsroed the'7aord'.
2713. 71st committee shall determine whether 7t It necessarlr or
Article L Cisneral Ptiovisionsdedroble to ices notes and bands authorized pursuant to this chapter
27ia2 This chapter shall be[noon and maybe cited ar the Dleddsh in order to carry out the actions spedfled in Section 2706 and if ag the
AcL amount notes and bonds m be issued and sold Saaaea/ae mum of
27i I Msusedinthis chapter,the foAmoing fermi have trisf haaha. nater and bonds may be issued-and sold to carry out thous actions
Ing meaningsvelµand it knot nevrasary that all of the notes and bands so
(a) 'rom-, lip 'means this Tionsporeatioa Improvement Finance be issued and sold at any one"time. The committee shall
Commitee created pursuant to Section 2712. consider program funding need;.revenue prq/sctione,finandal-ma,kd
(b) 'Department"morns the Depastment of Trauspertatton condition; and other ry facmrs in determining this shortest
(e) -Fund' means the Transportation Imprommurnt Bond Fund feasible term for the nobs and bonds issued
created pursuant to Suction 27M 271A There shall be collected aarsuagp in Ar same manner and at
the same time as other state revenue is coltseted,the sum,in addition to
Article 2 Transportation Improvement Program the ordinary revenues hof the sore,required to ppaayy the principal of and
27WL 71w proceeds notar and bonds issued and sold pursuant to interest am the notes and bonds due and paysbbs each year aar�it is
this chapter shall be deposited in the Transportation Improvement hh rd +node the duty of all officers charged by law with any duty in
Bond Fund which is hereby created raga to the collection of the revenue to do and perform each and every
27146. The mmoounseyy in the= upon the Legirla- act which is necessary to collect the additional cern
tunyshall bisaveilablsforezpendsturehoitse
go
toimaalyearafor 2715 NohvithstondingSection13340ofdie GovernmentCodithere
state highway and exclusive public mass tmwit gutderaayy eapstal is hereby appropriated from the CrnerollFund in thevto��
improvements in accordance with Cho ter2(commencing poith Section without regard to f lttal years, for the purpose of
i452D)of Part 5.3 0fDiaision 3 of Title 2 of rte Government Code and amount equal to that sum annually necessary to pay_the principal of,
co
or local commum hanrpormtion tal impprroo is on local and the interest on,the notes and bonds issued and sold pursuant to this
sheets and rood;state highway;and those guideeagprojacts chapter as the principal and interest become due and payable.
Article 2 Fiscal Pitrabions2716 Money may be transferred from the fund to the State
Transportation Fund to smiaburse the State H' hway Aotount for
2710! Notes and bonds in the total amount of one billion dollars expenditures made subsequent to the adoption o7this chapter by the
01,010IQA 404),exclusiveof rejrtnding bonds,or so much thereof as is voters for the purposes of state highway and exclusive public once
necaraarnecessary, may, be issued android to pros a fend M be used for transit guideway capital improvements in accordance with Chapter 2
carrying out the putposas in this chapter, and to be used to (commencing with Section 14524)ojrPzvt55qjrDivkioa 3 of Title 2 of
reimburse the General O Bond Expense Revolving Fund the Government Code as specified in Section 27M
pursuant to Section 167245 of the Covernment Cade The notes and The a9egate amounts that may be transferred under this sectio
bonds shall when sold be and constitute a valid and binding shall not be in excess of amounts appropriated by the Legislaturefrom
obligation of the Stave of C�abforniq and the full faith and credit of the the fund for that purpose
State Cao fifornia is herep�dgad for thepunchus payment ofboth 2717. The board may request a loan from the General Fund or the
principal and interest on, the notes and bonds as t principal and Pooled Money Investment Account,in aaaordance with Section 163/2 of
interest become dare and payable. the Government Code,for the purpases of carrying out this chapter.
2711. (a) Except as provided in subdivision (b), the notes and The amount of the request shall not exceed the amount of the unsold
bonds authorirrH by this chapter shall be prepared, executed, issued, rotes and bonds which the committee has, by resolution,authorized to
sold, paid, and redeemed as provided in the State General Obligation be sold for the purposes of mrrytng out this chapter. Money�eived
Bond Law (Chapter 4 (commencing with Section 167210) of Part 3 of ftvm the sale of bortdr shall be=to repay the loan
Division 4 of Title 2 of the Coe ernment code),and all of the provisions Any amounts loaned shall be deposited in the fund to be allocated by
of that law apply to the rotes and bonds and to this chapter and are the board in accordance udth this chapter.
hereby incorporated in this chapter as though set forth in fall in this 2718 AU money deposited in the And which is derived from
chapter. premium and accrued interest on notes and bonds sold shall be reserved
(b) Notwithstanding any other provision of this chapter or the State in the ad and shall be available for transfer to the General Fund as
General Obligation Bond Lau; the following applies a it to expenditures for bond interest
(1) Foch issue of bonds authorized by the committee shall have a 2719 Any bonds issued and sold pursuant to this chapter may be
finall maturity of 210 years and shall be structured toas nearly refunded by the issuance of refunding bonds in accordance with Article
as passible, leve ncipal payments over the life Of ban& 6 (commencing with Section 16781)) of the State General Obligation
(2) Any boards may be called and redeemed prior totheir stated Bond Law Approval by the electors of the&totefor the issuance of
maturity only from the Proc eds°f n fusdsng bonds or form funds bonds shall include approval of the issuance of any bonds issued to
appropriated by the Legislature which are proceeds of razes of the state refund any bonds originally crowed or any preowusly issued refunding
anticipated to exceed the state's appropnations limit crony 1 year, bonds.
if the amount used to redeem the bond;don not acesd t amount 2720. The Legislature here finds and declares that, inasmuch as
which is erMfied by the Controller to be the troth of tis of eases the proceeds from the sale of notes and bonds authorized by this
for that fiscal year,as those terms are defined in Article XIII B of the chapter are not"proceeds of tazes"as that term it used in Article XIIIB
California Constitution. For purposes of this pa ph, the use of of the California Constitution, the disbursement of these proceeds is
proceeds of razes to redeem bonds prior to theirstarad maturity shall be not subject to the limitations imposed by that article
deemed to be the payment of debt service on the bonds within the 2721. The Departrnent of Transportation shall be responsible for the
meansng ofArticle X111 AM dedicationofthe proceeds of taxes to an administration of all money in the fund In consultation with the
re
escrowfurid to deem the bonds on the fsrst date on which they may Treasurer and the Director of Finance, the department shall establish
be redeemed shall also be deemed as parent of debt service on the the procedures necessary to ensure compliance with all state and fidenaI
bonds within the ramming of Article XIIlaws pertaining to the sale and use of geneml obligation bonds
C_g-?' 37
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,-..
Deddeh Transportation-
Armament
ransportation=Atgutn t Apbut PropoBition.74
. e
T mnsportation-Ia a critical problem.in California.,flow belief that.our transportattop;P.
o Aems mm
ever, bond.finaaciing is not an eve solution for,the away. : ,
state s tazpayers ,. Under the Deulrmepan Administiatiitin;._California=is
This I:1-billion-dollar.bond wiII'oost'today's taxpayers now last of all SO'states"in-per`eapita-'spending.'on
and our children more than$2 billion when the interest highways. This band-aid, deficit financing _approach of
casts are finally paid for twenty years down the road. taking out loans to pay for transportation is too expensive
Historically, Californians have built the best highway and too shortsighted. For decades,both Republicans and
system in the nation on a pay-as-you-go basis. When we Democrats have agreed that.pay-as-you-go finding of
needed new roads or transit systems.we paid-for them transportation is the responsible path to take.Members of
through the gas tax and other direct.revenue sources.The both parties also acknowledge that between $15 and $20
revolutionary change we are being.asked to approve in billion will be needed to meet the state's transportation
bond financing for highway construction is just another requirements by the year 2000.
step down the road of fiscal irresponsibility. There is no free lunch when it comes to addressing our
If this example of deficit financing would solve Califor- transportation needs. Let's face this issue squarely and
nia s transportation problems, what's around the corner vote no on Proposition 74. Bond financing of our traas-
might not be so frightening. But it won't The California portabon system represents a radical break with Califor-
Transportation Commission estimates that over the next nia's past, and a betrayal of California's future.
five years our state will still be $1.6 billion short of Sincerely,
meeting our immediate transportation needs, so even if JOHN GAAAMENDI
this bond is approved we will merely speed through one State Senator,Rh Dish
warning sign of impending gridlock for a brief moment BILL LOCHYER
while we borrow against our children's future in the same Ssase Senator,loth District
motion.This bond act does not represent progress,but a bca[E ROM
blind denial of the challenges ahead in the mistaken Speaker pro Tempore,Smte AeeemNv
Rebuttal to Argument Against Proposition 74
Proposition 74 is a cost-effective way to build more lenges. It guarantees that projects planned throughout
roads and improve Californias transportation network, the state will be built It assures that we will receive our
without raising your taxes. full share of federal highway funds.
THE OPPONENTS' ALTERNATIVE TO PROPOSI- THE BONDS IN PROPOSITION 74 ARE NOT RE-
TION 74 IS TO INCREASE TAXES OVER A BILLION QUIRED TO BE PAID BACK OVER 20 YEARS AS THE
DOLLARS. IF THAT'S WHAT THEY WANTED, WHY OPPONENTS CLAIM. PROPOSITION 74 ALLOWS
DIDN'T THEY PLACE A TAX INCREASE PROPOSAL THEM TO BE PAID OFF AT AN EARLIER TIME AT A
ON THE BALLOT AND LET THE PEOPLE VOTE ON SAVINC TO THE TAXPAYERS.
IT? We need to address our critical transportation needs
Bonds have been used to build public facilities of all now. The opposition agrees that additional funding is
kinds in California,and are used for transportation in many necessary to improve California's transportation network.
other states. They can effectively be used to build roads But other than raising taxes, the opposition offers no
here in California as well. solutions. Let us use a method employed in many other
Every resident who has a mortgage payment or a car states to allow us to build new roads now.
payment recognizes that it makes good sense to invest in. GEORGE DEUKMEIIAN
major purchases and pay back the investment over time. Cooenor
The same holds true for the transportation system you WADIE DEDDEH
and your children will use for years to come. Member of she Senatq 4&h District
Proposition 74 does not replace historic funding meth- TOM HAWTHORNE
ods. It helps meet today's unique transportation chat- Chairman,California Trunspm*dwn Commies Cm
P88 Arguments printed on this page are the opinions of the authors and have not been checked for accuracy bCofficyL@M 39
al L
Deddeh Transportation Bond .Act
- Argument in Favor of Proposition 74
A yes vote on.Proposition 74 is a'vote for more and roads, public transportation',improvements. or locally
better highways.It is a vote for better puhlic..Umsporta. important additions to the.state highway.system. Seven ._
tion and better local streets and roads hundred million dollars will be used for state highways;
If you are one of the millions of Californians meeting Public transportation facilities,and soundwalls along busy
irritating delays driving to and from work,Proposition 74 freeways.
is especially.important to you Even if you are nota Our state has the finest transportation system in the
country.We have pioneered designs and technology that
California commuter, Proposition 74 is still important to
are imitated all over the world. We have met the
you. Making sure people and goods can move efficiently . to
on our state's transportation system means getting prod- none.challenge of building a highway system that is second w .
ucts and services where they.are needed and at a lower none.Now the challenge is to add the new lanes,the new
rice. More efficient highways also mean cleaner air. interchanges' and the new highways ia..growing areas
P � Ys that California must have for jobs and healthy economy.
The roads and public transportation built with Propo- We urge you to vote YES on Proposition 74.
sition 74 money will be working for all f alifornians lIItO GEORGE DEUS1MU AN
the next century. Proposition 74 will let all Californians ornians mor
who benefit, then and now, share in the cost. WADIE DEDDEEI
Proposition 74 will provide a billion dollars for trans- Member of the Senate,soeh District
portation. Local governments will be eligible to share TOM HAWTHORNE
$300 million for whatever local priorities call for—streets, Chairman,California Transportation Commiaeion
Rebuttal to Argument in Favor of Proposition 74
A yes vote on Proposition 74 does not begin to meet casts taxpayers twice as much as the pay-as-you-go system
California's transportation needs.A yes tote is a vote for that the state has traditionally used
the mast expensive streets and highways in our state's A no vote on Proposition 74 sends a message to the
history. Legislature and the Covernor that Californians want real
In fact, this bond measure is a revolutionary departure answers to our transportation needs. A no vote says our
state is not willing to blindly travel down a path of deficit
from a decades-old pay-as-you-go tradition that allowed
financing'
us to build the nation's best transportation em. For
�P° � Vote for fiscal responsibility. Vote no on Proposition 74
this $1 billion,California taxpayers will pay more than$2 and tell state government that you want real transporta-
billion in debt service and other costs. We don't have to tion solutions,not expensive propositions that won't even
travel down this road of fiscal mismanagement. do the job.
Only %3th of our minimal transportation needs over Sincerely,
the next decade will even be addressed by Proposition 74, VIC FAZIO
so let's recognize this bond proposal for what it is--an Coasrwraaa,4th Dtetrtet
expensive hoax on the state's taxpayers. JOHN GARAMENDI
Cali nrnianc are being asked to approve an unprece- state Senator,Sth Diarist
dented $6 billion in bonds this year. What the sponsors GOVERNOR EDMUND G. (PAT) BROWN
don't talk about is the fact that this transportation bend Former Governor,State of California
Vote June 7, 1988.
38 Arguments printed on this page are the opinions of the authors and have not been checked for accuracy by anyo ate, cq�P88
ury of Morro- bay
595 Harbor St. -
Morro Bay, CA 93442
805-772-1214
March 7 , 1988
The Honorable George Deukmejian
Governor, State of California
State Capitol
Sacramento, CA 95814
RE: veto SB 140 (Deddeh)
$1 Billion General Obligation Bond for Transportation
Projects
Dear Governor Deukmejian:
The San Luis Obispo/Santa Barbara Area City Managers Group
( 14 cities, 2 counties ) wishes to inform you of our collec-
tive belief that general obligation bonds for transportation
projects represent the least-desirable form of financing to
improve our transportation infrastructures. Ironic as it
may appear, we seek your veto of SB 140 (Deddeh) for pur-
poses of fundamental disagreement with utilizing general
bond indebtedness to support a Statewide need historically
funded through gasoline taxes.
While we as a profession are among the first to proclaim and
support additional revenues to enhance our transportation
systems, increasing the State gasoline tax to address the
problem is the more appropriate and preferred financing
method. The user of the transportation system should bear
the financing obligation (gas tax ) , not the general populace
as a whole. The bonded indebtedness of the State of
California should be reserved for other priority needs not
having a revenue source allocated to its purpose.
The concept of generating additional revenues to maintain
our decaying transportation systems has universal accep-
tance, but SB 140 is the unadvisable approach. Please veto
COMMUNITY DEVELOPMENT FIRE DEPARTMENT PUBLIC WORKS
595 Harbor Street 715 Harbor Street 695 Harbor Street
FINANCE DEPARTMENT POLICE DEPARTMENT RECREATION DEPARTMENT
595 Harbor Street 850 Morro Bay Bivd. 535 Harbor Street
this bond measure, and support the more equitable and tradi-
tional form of transportation revenues by increasing the
gasoline tax.
Sincerely r
GARY A. NAPP
City Administrato
Chairman, San Luis Obispo/Santa Barbara Area Managers Group
GAN:ad
cc: Mayor Greg Cox, President, League of CA Cities
Dwight Stenbakken, League of CA Cities
Area City/County Managers
-2-
C _g- ��
'k
L�cl
�tatr of LGOVERNOR'S OFFICE
GEORGE DEUKMEJIAN SACRAMENTO 95814
iOVERNOR
March 30, 1988 •..
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Mr. Gary A. Napper
City Administrator
595 Harbor Street
Morro Bay, CA 93442
Dear Mr. Napper:
I was sincerely disappointed to receive your
correspondence in opposition to our transportation bond
proposal. It will provide $1 billion for very necessary
additions to state highways, local streets and roads and
�. public transportation.
California is racing to the challenges of the 21st
century. By the year 2010 our population will exceed 35
million and we will be adding 7 .8 million motorists to
our roads. In order to provide jobs for our citizens
and remain competitive. with other states, we must
improve our transportation network .
Merely rasing taxes, as you suggest, may have
provided the answers in the past, but they are not the
visionary answer to the future. Moreover, even if we
supported such tax increases, which we do not, such
revenue could not be spent under the state's spending
limit and would merely flow into a fund to be rebated to
taxpayers. In the last decade our overall tax burden
for state and local taxes has dropped from 4th place to
just about average with the other states in the nation.
This has enabled our economy to thrive and attract
business and job opportunities that would otherwise have
been unavailable for our citizens.
Letter to Gary Napper
Page two
To the millions of Californians who suffer
irritating delays driving to and from work our bond
proposal is critical. But even for someone who is not
one of those commuters, making sure goods and people can
move efficiently on our state's transportation system
means getting products and services where they are
needed at a lower price. More efficient highways also
mean cleaner air.
Our bond solution, which has been utilized by many
other states to build roads, can help achieve our
transportation goals without increasing the burden on
our taxpayers.
Most cordially,
George Deukmejian
GD:ASZ:sab
cc: Mayor Greg Cox, President, League of CA Cities
Dwight Stenbakken, League of CA Cities
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