BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                      



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          |SENATE RULES COMMITTEE            |                   AB 732|
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                                 THIRD READING


          Bill No:  AB 732
          Author:   Buchanan (D)
          Amended:  8/31/11 in Senate
          Vote:     21

           
           SENATE ELECTIONS & CONSTIT. AMEND. COMM.  :  5-0, 06/21/11
          AYES:  Correa, La Malfa, De León, Gaines, Lieu

           SENATE APPROPRIATIONS COMMITTEE  :  Senate Rule 28.8

           ASSEMBLY FLOOR  :  75-0, 05/26/11 - See last page for vote


           SUBJECT  :    Elections

           SOURCE  :     Author


           DIGEST  :    This bill requires the Attorney General's (AG's) 
          summary prepared in the state voter pamphlet for each state 
          bond measure to include an explanatory table summarizing 
          the Legislative Analyst's Office (LAO's) estimated fiscal 
          impact of the bond measure. 

           Senate Floor Amendments  of 8/31/11 prevent a chaptering out 
          problem with SB 334 (DeSaulnier), and AB 1021 (Gordon).

           ANALYSIS  :    Existing law:

          1.Establishes a process for the AG to prepare a title and 
            summary for each measure submitted to the voters of the 
            whole state. Requires the ballot title and summary to 
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            include a summary of the Legislative Analyst's estimate 
            of the net state and local government fiscal impact. 

          2.Requires the Legislative Analyst to prepare an impartial 
            analysis of each proposed measure describing the measure 
            and including a fiscal analysis of the measure showing 
            the amount of any increase or decrease in revenue or cost 
            to state or local government. Provides that if a proposed 
            measure is estimated to result in increased costs to the 
            state, the estimate of those costs shall be set out in 
            boldface print in the ballot pamphlet. 

          3.Requires the statewide ballot pamphlet to include 
            information, in a specific order, for each state measure 
            to be voted upon including, but not limited to: 

             A.   Upon the top portion of the first page, and not 
               exceeding one-third of the page, shall appear: 

                     Identification of the measure by number and 
                 title; and, 
                     The official summary prepared by the AG. 

             A.   Beginning at the top of the right page, the 
               analysis prepared by the Legislative Analyst. 

             B.   Arguments for and against the measure. 

           Related Legislation
           
          AB 1021 (Gordon) requires additional fiscal information to 
          be included in the circulating title and summary prepared 
          by the AG and the summary statements prepared by the 
          Legislative Analyst for a proposed initiative measure.  

           Previous Legislation
           
          AB 1278 (Harkey) of 2009, would have required the 
          Legislative Analyst to include additional information in 
          the ballot pamphlet for an election for each state 
          initiative measure that proposed the issuance of a state 
          bond. The bill also would have required that the ballot 
          labels for state bond measures include additional 
          information relating to the proposed bond. 







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           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  Yes   
          Local:  No

           SUPPORT  :   (Verified  9/1/11)

          California State Controller John Chiang
          California Taxpayers Association
          Little Hoover Commission 

           ARGUMENTS IN SUPPORT  :    According to the author's office:

               AB 732 attempts to decrease California's future debt 
               obligations by improving voter clarity on bond 
               measures and their future fiscal implications. The 
               bill would require the Legislative Analyst's Office to 
               prepare a simple and easy to understand graph, chart, 
               or report card for each statewide bond measure, 
               illustrating the information discussed in the Overview 
               of State Bond Debt section of the Voter Information 
               Guide. AB 732 stems from a recommendation from the 
               Little Hoover Commission's 2009 report, Bond Spending: 
               Expanding and Enhancing Oversight.  Nearly two-thirds 
               of California voters know very little or nothing about 
               how the state pays for bond measures. This makes it 
               very difficult for a majority of voters to know 
               exactly what they are authorizing at the ballot box 
               and how it contributes to the state's General Fund 
               obligations. 

               In addition to voters' limited knowledge on bond 
               financing, many organizations mislead voters to think 
               that enormous projects won't cost taxpayers. As more 
               general obligation bond measures are enacted, the debt 
               service on bonds consumes a larger portion of the 
               General Fund. General obligation bond measures 
               typically do not have a dedicated revenue source 
               outside the General Fund. Ads promoting the bonds 
               often tout that a measure can be implemented without 
               new taxes. While these bond measures may not 
               specifically require new taxes, they are not without 
               cost. In the current budget climate, money to pay for 
               a bond measure may displace money for another program 
               that derives its funds from the General Fund.  As our 







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               state's deficit continues to grow and the Legislature 
               is being forced to cut funding to school districts and 
               public safety organizations, Californians must do 
               something to control future debt obligations. In 2007, 
               the Legislative Analyst's Office reported that General 
               Fund debt payments for already authorized general 
               obligation and lease-revenue bonds for 
               infrastructure-related purposes will total about $4.7 
               billion in 2007-08, rising to a peak of $7.5 billion 
               in 2014-15. Unless the state does more to educate 
               voters on the impacts of ballot-box budgeting, 
               California's debt obligations could take up an even 
               greater portion of the General Fund and fiscally 
               impact the state for years to come. 


           ASSEMBLY FLOOR  :  
          AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Beall, Bill 
            Berryhill, Block, Blumenfield, Bonilla, Bradford, 
            Brownley, Buchanan, Butler, Charles Calderon, Carter, 
            Chesbro, Conway, Cook, Dickinson, Donnelly, Eng, Feuer, 
            Fletcher, Fong, Fuentes, Furutani, Beth Gaines, Galgiani, 
            Garrick, Gatto, Gordon, Grove, Hagman, Halderman, Hall, 
            Harkey, Hayashi, Roger Hernández, Hill, Huber, Hueso, 
            Huffman, Jeffries, Knight, Lara, Logue, Bonnie Lowenthal, 
            Ma, Mansoor, Mendoza, Miller, Mitchell, Monning, Morrell, 
            Nestande, Nielsen, Norby, Olsen, Pan, Perea, V. Manuel 
            Pérez, Portantino, Silva, Skinner, Smyth, Solorio, 
            Swanson, Torres, Valadao, Wagner, Wieckowski, Williams, 
            Yamada, John A. Pérez
          NO VOTE RECORDED: Campos, Cedillo, Davis, Gorell, Jones


          DLW:nl  9/1/11   Senate Floor Analyses 

                         SUPPORT/OPPOSITION:  SEE ABOVE

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