LOS ANGELES -- California voters Tuesday rejected four measures that would have authorized the sale of $5.9 billion of general obligation bonds to pay for earthquake rebuilding, construction at education institutions, and parkland expansion.
And in a surprise development, Democratic voters chose dark-horse candidate Phil Angelides, a Sacramento, Calif., developer, over the better-known veteran state senator David Roberti as their party's nominee to succeed Kathleen Brown as state treasurer.
On the Republican ballot for treasurer, Matt Fong, vice chairman of the state board of equilization, ran unopposed for his party's nomination.
Brown won the Democratic party nomination for governor and will face incumbent Republican Pete Wilson in the Nov. 8 general election.
The defeat of the four bond measures -- a record amount of borrowing presented to voters on a single election ballot -- continued a recent trend in which California's electorate has signaled is unwillingness to approve so many long-term borrowings.
In November 1990, state vendors defeated 12 of 14 bond proposals. I June 1992, they defeated a $1 billion bond issue for rail transit expansion. This November, voters will be asked to approve $1 billion of bonds for rail projects.
As for the recently defeated measures, Proposition 1A was $2 billion bond issue placed on the ballot by the legislature to finance the state's share of costs connected with the Jan. 17 Los Angeles earthquake and the seismic retrofitting of bridges across the state. It failed with 54.2% of the voters against it.
The measure's rejection could have budget ramifications as the state's political leadership works to complete a budget before the fiscal 1995 year begins on July 1. Funds already approved for planned transportation projects might be shifted to earthquake repairs and retrofitting, one state source said.
Proposition 1B, also placed on the ballot by the legislature, would have allowed the state to sell $1 billion of GO bonds to provide capital outlay funds for public schools. That measure was rejected by a narrow margin, with 50.4% against.
Proposition 1C, authorizing a $900 million GO bond issue for state public college and university construction, failed on a vote of 52.6% against.
A fourth measure, known as Proposition 180, would have authorized issuance of $2 billion of GO bonds for parklands. The measure, placed on the ballot through voter initiative petitions, lost with 56.5% opposing it.
In local elections, Robert L. Citron, Orange County's treasurer-tax collector, handily beat challenger John M.W. Moorlach, a certified public accountant. Unofficial results showed that the 69-year-old Citron pulled 60.8% of the vote, while Moorlach received 38.7%.
The election marked the first time Citron's re-election bid was contested since he was elected in 1970 to the nonpartisan office. He begins his seventh four-year term next January.
Moorlach, 38, asserted during the campaign that Citron's use of reverse repurchase agreements as part of his often-praised investment strategy for the count's $7.5 billion pooled investment fund was too risky. Citron countered that this investment approach allowed the pool to outperform the market in his nearly quarter of a century in office.
"The election results confirm our belief that the taxpayers of Orange County appreciate the efforts that Bob Citron has made to generate interest income that keeps their taxes down and validates our investment strategy," said Matthew R. Raabe, county assistant treasurer.
Moorlach, assistant treasurer to the executive committee of the Orange County Republican Party Central Committee, said he decided to challenge Citron because he is a Democrat. Citron is the only elected Democrat in Orange County government.
In other local results, San Francisco, California's only combined city and county, continued to show it is one of the few municipalities in the state that can consistently obtain voter support for bonded debt, although voters gave a mixed receptio to lease-related proposals.
Proposition A, authorizing $95 million of bonds for the San Francisco Unified School District, won with 69% of voters in vavor and 31% opposed.
Proposition B, allowing the city to issue $60 million of lease obligations for an emergency call dispatch center, was approved with 66% voting in favor.
However, Proposition C, which would increase the city's aggregate principal debt limit for lease financing of equipment without voter approval to $40 million from $20 million, was defeated with only 35% voting in favor.
Two other propositions that San Francisco voters approved have applications for the city's budget. Proposition D will increase police department staffing and salary levels between $13.8 million and $17.3 million annually. Proposition E will commit at least $34 million of funds to the library department annually.
Nikolai J. Sklaroff, a Moody's Investors Service assistant vice president, said the passage of the San Francisco charter amendments for police and library funding reduces budget flexibility.
The reduction concerns the rating agency because "San Francisco already has a number of constraints in its budgeting process that precludes [officials] from making certain cuts or dictating certain increases," Sklaroff said.
Meanwhile, the upcoming state treasurer's race will be a closely watched contest among municipal market participants as both candidates' positions on issues related to the public finance community become better known.
A spokeswoman for Brown's campaign said yesterday that Brown "supports all her fellow Democrats," but has not endorsed Angelides.
Angelides garnered 1.09 million votes, or 55.4%, to Roberti's 878,330 votes, or 44.9%, according to semi-official returns provided by the secretary of state's office.
Political pundits said Angelides, 40, was a dark-horse victor. Although Angelides had visibility in political circles because of his former charimanship of the state Democratic Party, he was much less well known than Roberti, 55, who recently received national publicity for surviving a recall election by gun-owner rights groups. The groups were upset with Roberti's authorship of a state bill banning assault rifles.
Angelides could not be reached for comment yesterday.
On the Republican side of the treasurer's race, Fong, 40, provided some insight into his municipal finance philosophy in a brief telephone interview yesterday.
Fond said Brown's policy of actively pursuing the inclusion of minority-and woman-owned firms in state bond deals needs to be reexamined.
"I will comply with the law, but it is my general sense in speaking to the investment community" that including certain firms owned by women and minorities in state bond syndicates "is costing taxpayers," Fong said.
"Some firms are not as fully qualified as other minority and woman firms, but are getting business just by cashing in on the cache of being woman- or minority-owned," Fong said. "I am going to be a little more strict on scrutinizing these firms to be sure those getting the business from the state are able to do it."
Fong said he was in favor of the defeated earthquake bond measure, but said he would support a gas tax as a pay-as-you-do alternative.
The candidate said he does not support Brown's proposal to bond out the state deficit over multiple years to reduce short-term budget stress because her proposal does not identify a dedicated revenue system, making the plan "financially irresponsible."
