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CA - AP Enterprise: Bond would push school borrowing over $100 billion
AP - San Luis Obispo Tribune ^ | Oct. 14, 2006 | AARON C. DAVIS

Posted on 10/14/2006 5:43:51 PM PDT by calcowgirl

SACRAMENTO - Voters in the eastern San Francisco Bay area suburb of Discovery Bay approved a contentious school bond in June to refurbish the city's middle school.

In November, they'll face another ballot measure seeking to build a new high school. And that's not all. They also will be asked to vote on a $10.4 billion statewide education bond - part of a record public works package supported by Gov. Arnold Schwarzenegger and legislative leaders.

Altogether, the November election will mark the 19th time in four years a local or state school bond has appeared on a Contra Costa County ballot.

"I'll vote for it, but there really is a feeling of 'Oh, God, are we doing this again?'" said Maria Sturdivant, a candidate for the Byron Union School District in Discovery Bay.

Her sense of deja vu is being shared by voters throughout the state this election season.

California voters have approved major statewide education bonds in all but one election year during the past decade at a cost of more than $37 billion.

Combined with scores of local school bonds passed during the same time, California voters since 1996 have authorized $95 billion in borrowing for school construction - more than in the previous 50 years combined.

As Californians this fall confront another mega education bond - Proposition 1D - polls show voters are becoming wary of the growing debt. If approved, the bond measure would push total school construction borrowing for the decade to well over $100 billion, before interest.

There also are signs the state's borrowing cycle for school construction may not be sustainable. Even before this year's bond - which would add $680 million in annual repayment costs if approved by voters - California's bills to cover past education bonds are hitting record levels.

Despite its size, Proposition 1D won't cover all the state's needs. Much more borrowing is expected to be needed.

Proposition 1D would account for only about a quarter of the state's school construction needs for the next decade, according to long-term bond plans the Schwarzenegger administration released in January.

Even if voters approve Proposition 1D, voters likely will be asked to approve an additional $40 billion or more in state and local school bonds before 2015, according to estimates by state officials and school groups.

Education proponents promise the cycle of school bonds will someday level off, but for now they say the continuous ballot requests simply reflect the need.

California does not set aside money in the state's annual budget to build new schools or provide substantive repairs for old ones. That forces local districts to rely almost entirely on bond money to pay for everything from school air conditioners and leaky roofs to refurbished classrooms.

"I think intuitively voters understand that buildings get old and need to be brought up to speed, and this is how we pay for that. It's a no-brainer for voters," said Scott Plotkin, executive director of the California School Boards Association. "Every election cycle we try to have an education bond on the ballot."

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California voters have been generous to their schools. The amount spent in recent years per pupil on construction is greater than in any other state.

Between local and state bonds, public schools and colleges in the state have spent an average of $26 million a day - every day - for the past 10 years on construction or refurbishing.

Proponents say the money has been well spent. School districts have built 40,000 new classrooms and modernized 97,000 others. State education officials say that has improved the learning environment for nearly half the state's 6.3 million kindergarten through 12th-grade students.

Colleges have built new campuses, upgraded labs and opened other key facilities.

Yet by other measures, progress has remained elusive.

In 1998, after voters approved $9 billion in statewide education bonds, a Department of Finance report estimated another $10 billion in state bonds would cover California's share of school construction needs for a decade.

Since then, voters have approved an additional $25 billion in state bonds, but the remaining estimated need has only grown.

In January, the state Department of Finance pegged the state's outstanding need at about $11 billion. The governor's plan suggests Californians will need to approve much more - three-and-a-half times more - by 2015, plus local matching bonds.

The state Department of Education calculates the need differently.

California must each day build 18 new classrooms and modernize 25 others through 2010 to keep pace with maintenance needs and a student population that is forecast to only grow by about 40,000 students - or less than 1 percent - over the next four years, according to department of education statistics.

Kathleen Moore, director of the Department of Education's school facilities planning division said voters should get used to thinking about the cycle of fixing and replacing broken schools, like the way homeowners count on endless home repairs: "There's always a need," she said.

But Proposition 1D, education officials acknowledge, won't cover that demand alone. To build that many classrooms, voters will have to approve billions more in state bond money in 2008.

And it won't end there. By the following decade, thousands of schools renovated in the 1980s will hit the 25-year mark and will be eligible again for modernization funds.

"The need seems to be a moving target," said Eric Brunner, an economics professor at Connecticut's Quinnipiac University.

Brunner has written a report scheduled to be released later this year on education spending.

In a rare calculation, he found that California from 2001 to 2004 spent an average of $1,245 per K-12 student on school construction. That exceeded the national average of $1,086 and even outstripped the amount spent in other states with growing student populations.

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Repaying the school-construction bonds, meanwhile, has become a bigger burden on state taxpayers.

California this year will make payments on 18 school bonds dating back to 1974. The combined cost will exceed $1.3 billion, according to the state treasurer's office.

Next year, the annual cost will jump to more than $2.3 billion and remain there for the rest of the decade.

A large part of the cost is interest. California typically repays its education bonds over 30 years at an average cost of $1 in interest for every $1 spent. Of this year's school bond payments, the state will put $493 million toward principal debt, while $834 million will go to interest payments.

If Proposition 1D passes, the payback on the $10.4 billion will be $20.3 billion with interest. The state's annual cost will be an additional $680 million - and push the state's total annual debt costs for school bonds to more than $3 billion.

Californians rarely pay for such debt in the form of higher taxes, so the payments take away funding from the state's general fund, which pays for social services, public safety, teacher salaries and other programs.

Even some education advocates say logic would dictate there's a better way to fund schools than always going back to the ballot.

"It's crazy we have to fund schools like this," said Dennis Kelly, president of the United Educators of San Francisco. "It's continuous. Every time our buildings need help ... we have to pass a bond."

Until California devises another system to pay for school construction, bonds will have an increasingly negative effect on the state budget, said Kim Rueben, a public finance economist at the nonprofit Urban Institute in Washington.

Leaving it to the whims of the electorate to determine funding for school construction has allowed contractors to demand higher prices because districts all try to build simultaneously after elections, Rueben said.

A better method would be to eliminate the feast-or-famine ballot-box approach, she said.

"If you smoothed out the funding, maybe by providing a per-student amount that schools could count on, districts could save up and be a little smarter about when they build," she said.

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One potential weakness of Proposition 1D is that it would allocate money for programs that seem to go beyond traditional brick-and-mortar classrooms.

Among the expenditures are $500 million for "career technical facilities," $100 million for unspecified "environment-friendly projects" and $200 million for a University of California medical curriculum focused on "telemedicine."

The California Taxpayer Protection Committee argues that the school bond earmarks too much money for such things.

The group, which wrote the rebuttal argument to Proposition 1D, also said the bond is unfair because some poor districts that don't approve matching local bonds may be ineligible for funding. The sheer time it will take to repay the bond also is problematic, the group says.

"Today's schoolchildren will still be paying for this bond long after their own children have graduated," wrote Thomas Hudson, the committee's executive director.

Proposition 1D divides funding in favor of fixing existing elementary, junior high and high school buildings. More than $7.3 billion would go to K-12 schools, while $3.1 billion would be split among community colleges, the University of California and California State University systems.

Of the money going to K-12, more than half is set aside to modernize existing school facilities or add permanent new classrooms in districts deemed "severely overcrowded."

Supporters stress that the bond money also would go to fix some 7,000 classrooms that may not be safe in an earthquake, although funding for those fixes is only $200 million - or less than 2 percent of the bond total.

"We'd like to have bitten off a little bit more," said Christopher Cabaldon, president of EdVoice, an online network of 25,000 activists who support education.

He said the bond is a way to continue recovering from a slip in education investment by California over the past two decades.

But Cabaldon and other backers say they worry that the ceaseless cycle of education bonds, combined with the rest of this year's infrastructure package to pay for roads, levees and housing, may be creating voter fatigue for new spending.

An internal e-mail sent to members of the Association of California School Administrators said California voters may be wondering why they are being asked to approve yet another school bond initiative after having passed so many in recent years.

Recent polls by the Public Policy Institute of California and the Field Poll have support hovering just about 50 percent.

This may be the year that breaks the string of success that education advocates have had in persuading Californians to approve bonds for building schools, said Bob Stern, president of the Center for Governmental Studies in Los Angeles.

"Voters may think, I've been there and done that," he said.


TOPICS: Government; News/Current Events; Politics/Elections; US: California
KEYWORDS: bonds; caleducation; calinitiatives; prop1d; publikskoolz

1 posted on 10/14/2006 5:43:52 PM PDT by calcowgirl
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To: calcowgirl

I am so sorely tempted to add up all the bond money, add in the school budgets, and calculate the true cost to educate a single student vs the most expensive private schools in the state. My guess is that the 'expensive' schools will be about half the price.


2 posted on 10/14/2006 5:51:35 PM PDT by kingu (No, I don't use sarcasm tags - it confuses people.)
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To: calcowgirl

It's for the children


3 posted on 10/14/2006 5:59:06 PM PDT by paul51 (11 September 2001 - Never forget)
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To: calcowgirl

I'm not voting for any more school bonds - I don't give a damn what they claim they're for - until I see some return for the money we already pay for education. As far as I can tell, if it weren't for Mississippi (or maybe Arkansas), California would come in DEAD LAST in the education sweepstakes. Thank you, teachers' unions - you're doing a helluva job. But not on my dime any longer.


4 posted on 10/14/2006 5:59:22 PM PDT by hsalaw
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To: hsalaw

Come on. It takes a village, also.


5 posted on 10/14/2006 6:05:25 PM PDT by paul51 (11 September 2001 - Never forget)
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To: calcowgirl
WOW!! $100 Billion!!

just imagine how many state-of-the-art Aircraft Carriers, F-22 Raptors and other critically important millitary investments could be purchased with that sort of money!!

Instead, they are just gonna piss it off on stupid thing like teachers unions, gay propoganda, etc which has absolutely nothing and has shown NOTHING in advancing education for the kids :-( :-(

6 posted on 10/14/2006 6:05:39 PM PDT by prophetic
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To: calcowgirl
"It's a no-brainer for voters"

Red alert!

There's always some Democrat buzz-phrase at election time, where's the beef, out of touch with reality, etc. This year it's "no-brainer" as in don't think when you vote for more spending. I searched Google News and it came up with 2,400 "no-brainer" hits in recent propaganda. Enough already.

7 posted on 10/14/2006 6:31:47 PM PDT by Reeses
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To: calcowgirl
"If you smoothed out the funding, maybe by providing a per-student amount that schools could count on, districts could save up and be a little smarter about when they build," she said.

Translation: Give us more money to spend now and we'll promise to save some for later.

And that's all you get, a promise.

The worst thing about all this bricks and mortar investment is that in an age of distance learning, bricks and mortar are the last thing we need to improve education. It's warehousing kids for indoctrination, pure and simple.

8 posted on 10/14/2006 7:17:22 PM PDT by Carry_Okie (The environment is too complex and too important to manage by central planning.)
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To: Carry_Okie

Exactly. Kids can be educated via the web for a fraction of the cost. In fact, there are already businesses online that offer a comprehensive high school diploma.


9 posted on 10/14/2006 7:19:53 PM PDT by Extremely Extreme Extremist
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To: Extremely Extreme Extremist
It takes even less than that. All it took was the Internet, Amazon, pencil, paper, and discipline for both my girls to be doing college level work by the age of twelve.

It ain't that hard.

10 posted on 10/14/2006 7:26:13 PM PDT by Carry_Okie (The environment is too complex and too important to manage by central planning.)
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To: Carry_Okie
The worst thing about all this bricks and mortar investment is that in an age of distance learning, bricks and mortar are the last thing we need to improve education. It's warehousing kids for indoctrination, pure and simple.

Exactly. It's a massive con game - possible only because the misinformed public keeps voting for their own romantic mental images of "how school used to be".

It's my contention they could close the entire California K-12 public school system down and end up with the exact same number of college-ready 18-year-olds every year. The smart kids, and the average kids with involved parents, will succeed no matter what kind of educational architecture is or isn't in place. The dumb kids won't succeed no matter how much you spend, and the public schools just provide the same function for them as prison for dumb adults - a great place to share and learn new crime techniques. ;)

11 posted on 10/14/2006 7:26:18 PM PDT by Mr. Jeeves ("When the government is invasive, the people are wanting." -- Tao Te Ching)
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To: Mr. Jeeves
It's my contention they could close the entire California K-12 public school system down and end up with the exact same number of college-ready 18-year-olds every year.

Actually, I think the quality of the incoming students would improve. Not needing to pay the taxes to support the system, far more parents could stay home and teach their kids, fixing their own miserable educations simultaneously.

An informed electorate would be the real "twofer" in that deal.

12 posted on 10/14/2006 7:31:05 PM PDT by Carry_Okie (The environment is too complex and too important to manage by central planning.)
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To: calcowgirl
"I'll vote for it, but there really is a feeling of 'Oh, God, are we doing this again?'" said Maria Sturdivant, a candidate for the Byron Union School District in Discovery Bay.

I'm not sure I could point to an election in my memory that did not offer up a school bond. She has this feeling and yet there she is: she's voting for it!

13 posted on 10/14/2006 8:56:29 PM PDT by newzjunkey (Support Arnold-McClintock or embrace high taxes, gay weddings with Angelides.)
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To: prophetic
WOW!! $100 Billion!! just imagine how many state-of-the-art Aircraft Carriers, F-22 Raptors and other critically important millitary investments could be purchased with that sort of money Last of the Nimitz, the GHWBush carrier only cost $6 billion. The next class is estimated to run $13 billion per copy. GAO said this year Raptors are around $200 million each.

For $100 billion you could get 4 next generation carriers and around 240 F-22s, almost enough to fully stock those four carriers.

14 posted on 10/14/2006 9:22:08 PM PDT by newzjunkey (Support Arnold-McClintock or embrace high taxes, gay weddings with Angelides.)
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