Schwarzenegger wants to build new prisons, schools, dams (Let's borrow 43 billion more!)

SACRAMENTO – Gov. Arnold Schwarzenegger on Tuesday proposed another huge round of borrowing to build prisons, schools and dams in a state of the state speech that also called for cleaner fuels to help curb global warming.

The borrowing proposals, which add up to $43.3 billion, are similar to ideas that were cut out of the enormous borrowing plan the governor put forth last year. The Legislature changed it and cut it in half, and voters eventually approved $42.7 billion in bonds in November.

Addressing a joint session of the Legislature, Schwarzenegger said he was bringing the ideas back because, “We are a big state, and we have big needs. And we have made a big down payment, but the job is not finished.”

The governor is calling for $29.4 billion in general obligation bonds, which require voter approval, and $13.9 billion in lease revenue and other bonds, which the administration says would not need to be approved by voters.

Schwarzenegger said the state needs new prisons to relieve overcrowding, which he called a disgrace. The prisons are so full that the federal courts are threatening to intervene by capping the inmate population and potentially ordering early releases of criminals.

“Here are the court-ordered choices we face,” Schwarzenegger said. “We build more prisons or the court takes money from education and health care and builds the prisons itself. Now I am not in favor of releasing criminals. I am not in favor of taking money from classrooms and emergency rooms to build prison cells.”

Schwarzenegger also wants to spend $4 billion on new dams in Northern California and near Fresno, an idea Democrats and environmentalists vehemently oppose. He wants to spend another $500 million on ground water storage.

Schwarzenegger said the dams are necessary to store more of the water from Sierra snowmelt, which could be reduced by global warming. Two-thirds of Californians depend on the snowmelt for drinking water. Central Valley farmers also use it to irrigate their fields.

The school bonds would build 15,000 new classrooms and renovate another 40,000, in addition to the $10.4 billion school bond voters approved last year.

Schwarzenegger's finance director, Mike Genest, said the state can afford the new borrowing because it is paying off early the bonds voters authorized in 2004 to pay off the budget deficit that ballooned after the dot-com crash.

“We think this is affordable within the state's budget in the long run,” he said.

Other independent financial experts said the proposed borrowing plan was so large that it could take days to fully analyze its impact on California's budget. Some economists immediately criticized the concept as shortsighted.

“The tendency for the state to borrow is extremely unwise,” said Edward Leamer, director of the University of California, Los Angeles, Anderson Forecast. “It's pushing spending on to the next generation, and that's not fair and it's not wise ... Borrowing is not some magical way to pay for what the state provides.”

He said cars should run on cleaner-burning fuel to help reduce greenhouse gases, mostly carbon dioxide, that most experts say are warming the Earth's atmosphere. And he proposed that California become the first to develop a carbon fuel standard.

“Let us blaze the way, for the U.S., for China and for the rest of the world,” Schwarzenegger said. “Our cars have been running on dirty fuel for too long. Our country has been dependent on foreign oil for too long.”

Schwarzenegger wants California refiners to reduce the carbon content of passenger vehicle fuels 10 percent by 2020.

Adding more ethanol to gasoline and using cars that burn natural gas and use hybrid and electric technology could help California reduce greenhouse gas emissions by 10 percent, said Robert Sawyer, chairman of the California Air Resources Board.

That will go a long way toward meeting the requirements in the landmark global warming bill Schwarzenegger signed last year.

The governor will lay out his budget on Wednesday and he promised it would “dramatically reduce” the state deficit without raising taxes. However, the governor faces a budget gap of $5.5 billion.

He also is proposing an ambitious plan to extend health coverage to California's 6.5 million uninsured people.

Associated Press writers Aaron C. Davis, Don Thompson and Samantha Young contributed to this report.

corrected link

Limping into second term, Schwarzenegger keeps appearances to minimum
Jan 9, 2007

Michael R. Blood - ap

January 9, 2007

Excerpt

LOS ANGELES – Gov. Arnold Schwarzenegger's surgically repaired leg has become an obvious obstacle as he limps his way through a week of major events in Sacramento while dealing with the aches and pains that follow a major operation.

His public appearances and traveling have been cut back as he recovers, though he says he's “feeling great” since surgeons used cables and screws to repair his fractured right femur, which he broke in a skiing accident Dec. 23.

Lawmakers who have met with him in recent days say he's managing to get around with the ailing leg despite being in obvious discomfort at times.

At a private lunch after his Friday inauguration, “he kept a good face on but you could tell he was hurting,” said state Senate Minority Leader Dick Ackerman, R-Tustin. “You could tell he was in pain.”

Schwarzenegger proposes $4.5 billion for water storage
By SAMANTHA YOUNG
http://www.pe.com/ap_news/California/CA_Schwarzenegger_Water_270178C.shtml
The Associated Press

SACRAMENTO

Gov. Arnold Schwarzenegger, alluding to the drastic changes global warming could have on the state's water supply, is proposing spending $4.5 billion to create two reservoirs and store more water underground.

The items are a key aspect of the governor's $43.3 billion bond plan, which he revealed Tuesday during his state of the state address. One of the proposed reservoirs would be in a valley about 60 miles north of Sacramento, while the other would be near Fresno.

The projects are supported by farmers but opposed by many Democrats and environmentalists.

"The issue is securing our water future," Department of Water Resources Director Lester Snow said Tuesday in reaction to Schwarzenegger's plan. "We hope to have a genuine discussion. The runoff pattern isn't going to be different in the future. It's different now."

State reports suggest that warmer weather will melt the Sierra snowpack earlier, lead to flooding in the Central Valley and the San Francisco Bay area, and threaten the state's water supply.

Schwarzenegger must persuade Democrats, who hold a majority in both houses of the Legislature, to put two bonds on the 2008 ballot to pay for the reservoirs with $2 billion to be repaid by contractors who would use the water. Another $2 billion would be funded by taxpayers for the dams, while $500 million would go to groundwater storage.

Building dams remains a tough sell for Democrats, who last year rejected a similar proposal by the governor.

Assembly Speaker Fabian Nunez, D-Los Angeles, called Schwarzenegger's attempt to link water storage to climate change "a bit of a stretch."

"The way to avoid the impacts of global warming is not by saying, 'Let's prepare ourselves for it.' Let's prevent it," Nunez said.

Environmental groups said the governor's argument is a ploy to subsidize farmers in the Central Valley eager for more water.

"This is not a question of meeting California's water needs. This is about subsidizing water users," said Barry Nelson, senior policy analyst at the Natural Resources Defense Council. "We think it's simply irresponsible to commit billions of dollars to construct these projects before they are proved credible."

The state and federal government have spent years studying what the impacts could be from the proposed Sites reservoir in a valley north of Sacramento and a Temperance Flats reservoir near Fresno.

Snow said the environmental consequences are minimal, adding that the projects would be ready for construction if voters approved the money in 2008.

"If you don't build reservoirs, we'll lose a lot of water," said Steve Hall, executive director of the Association of County Water Agencies.

Schwarzenegger's total proposed water bond is $6 billion, with $1 billion set aside for upgrading canals through the delta. Much smaller amounts would be used for conservation programs and restoration efforts on the Klamath, San Joaquin and Sacramento rivers, as well as at the Salton Sea in the Southern California desert.

Published: Tuesday, January 9, 2007 18:40 PST

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