Affordable housing bond does neither - Prop. 1C's billions will go to social welfare programs

Orange County Register ^ | November 2, 2006 | Shikha Dalmia

[calcowgirl]

Proposition 1C is being billed to California voters as the affordable housing bond. But the reality is that it has very little to do with housing – and even less with affordability.

(snip)

There is no way to determine exactly how much of the bond money will eventually go toward actually building housing. But the most generous reading suggests that it will be no more than $550 million – or less than a fifth of the measure's $2.8 billion principal. Of the remainder, about $1 billion would go toward such welfare items as: homeless shelters; youth housing; down-payment assistance for first-time homebuyers; and – most incongruously for an infrastructure bond – health and social services for low-income renters. And the rest of the $1.2 billion would go toward such social engineering schemes as: grants for urban environmental cleanup to encourage "infill" development in polluted lots; grants to encourage dense development near public transportation; and funding for parks.

All of this is misguided in and of itself. California is expanding social welfare programs when most other states are shrinking them. Meanwhile, social engineering efforts to force mass transit and urban living down the throats of families have failed nearly everywhere they have been tried. But what's worse is that, even if such programs made sense, they ought to be funded through the state's general revenue – not general obligation bonds. Such bonds are best used for capital projects like roads and similar infrastructure that generate long-term revenue. But in this case Sacramento is inviting taxpayers to mortgage their future earnings for schemes that offer no returns and may or may not even be needed down the road.

(snip)

Prop. 1C is bad social policy, bad fiscal policy and bad housing policy.

[calcowgirl]

But randomly air-dropping $6.1 billion in cash – the amount that this bond's principal and interest payments will cost taxpayers – across the state would offer California homeowners more relief than this initiative will.

[Michael.SF.]

A good rule of thumb for all Bond and Propositions:

When in doubt, Vote NO!

If it is truly worthwhile, it will eventually happen anyway.

[Amerigomag]

A good rule of thumb for all (30 year) Bonds.

One half the money you will pay in taxes to reimburse the bondholders can never be used for the intended purpose of the bonding.

30 year bonding is a 50¢ on the dollar proposition, which may even possibly be worse than government efficiency itself.