BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  ACA 8
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          ASSEMBLY THIRD READING
          ACA 8 (Blumenfield)
          As Amended  April 4, 2013
          2/3 vote.   

           SUMMARY  :  Amends the California Constitution to allow a city,  
          county, city and county, or special district, as defined, to  
          incur bonded indebtedness in order to fund specified public  
          improvements and facilities, with 55% voter approval of that  
          city, county, city and county, or special district.   
          Specifically,  this bill  :

          1)Allows a city, county, city and county, or special district,  
            as applicable, to incur indebtedness in the form of general  
            obligation (GO) bonds to be adopted by 55% of the voters of  
            the city, county, city and county, or special district, where  
            the GO bonds fund the construction, reconstruction,  
            rehabilitation, or replacement of any of the following:  

             a)   Public improvements, including, but not limited to,  
               improvements to transportation infrastructures, streets and  
               roads, sidewalks, transit systems, highways, freeways,  
               sewer systems, water systems, wastewater systems, storm  
               drain systems, and park and recreation facilities; and 

             b)   Facilities or buildings used primarily to provide  
               sheriff, police, or fire protection services to the public,  
               including the furnishing and equipping of those facilities  
               or buildings.

          1)Lowers to 55% the voter-approval threshold for a city, county,  
            or city and county to incur bonded indebtedness, in the form  
            of GO bonds, that exceeds in one year the income and revenue  
            provided in that year, for the construction, reconstruction,  
            rehabilitation, or replacement of any of the following:

             a)   Public improvements, including, but not limited to,  
               improvements to transportation infrastructures, streets and  
               roads, sidewalks, transit systems, highways, freeways,  
               sewer systems, water systems, wastewater systems, storm  
               drain systems, and park and recreation facilities; and 

             b)   Facilities or buildings used primarily to provide  
               sheriff, police, or fire protection services to the public,  








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               including the furnishing and equipping of those facilities  
               or buildings.

          1)Defines "special district," for purposes of this bill, as the  
            same meaning as that term is used in the California  
            Constitution for the section related to voter approval for  
            local tax levies, and includes a transit district, but does  
            not include a school district or redevelopment agency.  

           EXISTING LAW  : 

          1)Authorizes cities, counties, and special districts to impose a  
            general tax for general governmental purposes with the  
            approval of a majority of the voters.

          2)Authorizes cities, counties, and special districts to impose a  
            special tax for specified purposes with the approval of  
            two-thirds of the voters.

          3)Authorizes school districts, community college districts, or  
            county offices of education to incur school bonded  
            indebtedness with the approval of 55% of the voters voting on  
            the bond measure, require that bond proceeds only be used for  
            purposes specified in the California Constitution, and  
            requires an audit to ensure that the funds have been expended  
            only on the specific projects listed.

          4)Prohibits specified local government agencies from incurring  
            any indebtedness exceeding in one year the income and revenue  
            provided in that year, without the assent of two-thirds of the  
            voters.

           FISCAL EFFECT:   Unknown, there may be one-time General Fund  
          costs to include an analysis of the measure, and arguments for  
          and against the measure, in the state voter pamphlet. 

           COMMENTS  :  Article XIII of the California Constitution allows  
          for bonded indebtedness for a school district, community college  
          district, or county office of education to fund the  
          construction, reconstruction, rehabilitation, or replacement of  
          school facilities, including the furnishing and equipping of  
          school facilities, among other provisions, if approved by 55% of  
          the voters.  This section of the Constitution also requires that  
          the bond proceeds be used only for the purposes listed, and  








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          requires annual independent auditing to ensure that funds have  
          been expended on the specific projects listed.

          This bill mirrors these requirements in the Constitution in  
          place for school districts by providing that a city, county, or  
          specified special district incur bonded indebtedness for  
          construction, reconstruction, rehabilitation, or replacement of  
          public improvements and public safety facilities or buildings,  
          if 55% of the voters approve.  The current threshold to pass GO  
          bond measures for cities, counties and special districts is a  
          two-thirds vote.

          The author notes that it is estimated that California needs at  
          least an additional $500 billion for maintenance, repair and  
          upkeep of the crumbling sewer and storm drain systems, streets  
          and sidewalks, overcrowded and outdates policy stations, jails,  
          fire stations, and libraries.  The author argues that every $1  
          billion invested in infrastructure creates more than 15,000  
          California jobs. These infrastructure investments will enhance  
          public safety, increase the value of real estate, and improve  
          the quality of life in communities as vital facilities will be  
          better maintained to safely serve today's population. 

          Lowering the voter threshold for special taxes and bond  
          indebtedness has been tried several times in the past years.   
          ACA 7 (Nation) from the 2005-06 Legislative Session would have  
          lowered the constitutional vote requirement from two-thirds to  
          55% for any special tax.  ACA 10 (Feuer), would have created an  
          additional exception to the 1% ad valorem property tax for  
          transportation projects with 55% voter approval.  There were  
          several measures introduced in the 2009-10 session that would  
          have revised constitutional voting thresholds for different  
          purposes, including ACA 10 (Torlakson), ACA 15 (Arambula), SCA  
          12 (Kehoe), ACA 9 (Huffman), and SCA 6 (Simitian), none of which  
          were enacted.

          There are currently several bills in the 2012-13 session that  
          would amend the California Constitution to lower the vote  
          threshold, including ACA 3 (Campos), SCA 3 (Leno), SCA 4 (Liu),  
          SCA 7 (Wolk), SCA 8 and 9 (Corbett), and SCA 11 (Hancock).

          Support arguments:  The Los Angeles Business Council, in  
          support, writes that communities throughout California have  
          fallen far behind in their ability to repair their local  








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          infrastructure.  

          Opposition arguments:  The California Taxpayers Association, in  
          opposition, writes that a lower voter threshold undermines  
          Proposition 13 taxpayer protections.  


           Analysis Prepared by  :    Genevieve Morelos / BUDGET / (916)  
          319-2099


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