California school districts probably will put more general obligation bond issues on the ballot if Proposition 170 wins in the November statewide election.
That's because, for the first time, the odds would be stacked in favor of voters' approving local school bond issues.
Proposition 170 calls for simple-majority approval, instead of the two-thirds vote now required, on local school GO bond measures that fund capital improvements.
"If we kept the amount [of a proposed bond issue] reasonable, we'd be successful with 50%. Most school districts should be able to do that," said Alan Newell, superintendent of the Antioch Unified School District.
All through California history, local government debt supported by property taxes has required approval by a two-thirds vote, according to the California Debt Advisory Commission.
Success or victory for Proposition 170 is seen as an indication of whether simple-majority vote proposals for other types of local bonds will appear on future ballots.
California Senate Constitutional Amendment 19 also would allow a simple-majority vote on extraordinary property tax rates imposed by local agencies, including schools. The bill, which would allow the property tax revenues to be used for principal and interest payments, is stalled in a legislative committee.
"If 170 passes, there would be an understanding in the Legislature that there is public support for removing fiscal restraints," said Steve Sanders, senior consultant of the Senate Office of Research. "If 170 fails, it will cause [legislators] who are undecided to decide that the public is not ready to loosen the shackles."
The View From Fresno
School district officials who have been daunted by the two-thirds voting requirement would be admong the first to put school bonds on local ballots, according to Laura Walker, senior legislative advocate of the California School Boards Association.
Joining them would be school districts that have tried repeatedly, and failed, to get such GO measures passed.
Fresno Unified School District is among the frustrated issuers. The district has tried for the last two years to get a $200 million GO school bond issue approved, which would cost about $24 a year for home owners who have average assessed valuations.
"We will definitely go back to voters in the spring if 170 passes," said Nancy Richardson, president of the Fresno district's school board. "We would be encouraged."
The district twice topped the 50% mark in voter approval for the $200 million issue. The district won 62% of the vote this year, up from the 59% approval rate obtained in an election last year.
Eight out of 22 school districts failed to get local GO bond measures passed last year, according to School Services of California.
The situation in Fresno is more the rule than the exception for measures that do fail. The California Debt Advisory Commission estimates that 84% of the local education bond measures that have failed on the ballot captured at least a simple majority of the voters.
The clear support in California for funding school district capital projects reflects the state's overwhelming need to build new facilities and to improve older ones. Most district officials, who have been forced to rely on a bare-bones state funding program, are eager to take control of their capital needs by. issuing GOs.
California has issued more than $6 billion in state school bonds since 1984, but school district officials say their needs are now greater.
"There is a $15 billion shortfall in school construction statewide, yet the state shudders at putting a $1 billion bond issue on the state ballot," said Newell of the Antioch USD. "If we do a local bond ... we can go out and say, ~This is what we really perceive is our overcrowding and this is what we really need.'"
While some school districts will scramble to the electorate with GO measures if Proposition 170 passes, others may find getting bond issues approved as difficult as ever.
The 40 school districts in California that have Mello-Roos special tax bonds outstanding, including Antioch, may derive the least benefit from Proposition 170 and have the least reason to bring bonds to the ballot. Voters in those districts are more likely to reject bond proposals because they already are taxed to support schools.
"I don't think Mello-Roos bonds will be an impediment to using [Proposition 170] as a legal matter, but as a political matter they could," said Daniel Bort of Orrick, Herrington & Sutcliffe. "Say you have 5,000 Mello-Roos voters in a district, they're likely to vote no on a GO bond."
Compounding the potential funding concern in Mello-Roos districts is S.B. 1287 - signed into law earlier this year - that would, if Proposition 170 passes, eliminate most state capital funds for schools by 1996.
Sources of Opposition
Mello-Roos districts are not alone in their concern about funding issues. Constituents in growing school districts, where current property owners would be taxed to fund new schools in undeveloped areas of their districts, also are likely to oppose school bond measures.
In contrast, more established districts - for example, those in the San Francisco Bay Area and Los Angeles - stand a better chance of gaining voter approval for GO debt because all the schools have a shot at getting some money for improvements, Bort said.
"People won't tax themselves to build schools for someone else," said Bcrt. "Even if you tell people that the new folks coming into the district will pay more for new schools because their property taxes are higher, it won't matter."
Still, California's overcrowded classrooms may be incentive enough for voters to give local GO bond measures a thumbs up, Bort said. If they believe that a new school in another part of the district will ease crowding in their own schools, they are likely to support local bond measures.
"If you keep piling kids into schools year-round and for double sessions, you might get people to vote yes," on school bond issues, Bort said.
Legislators are also considering other ways to relieve fiscal stress in the school districts.
Gov. Pete Wilson has until Oct. 10 to sign or veto S.B. 1, which would allow for simple-majority approval of levies, known as parcel taxes, that help fund school operating costs. Groups such as the California Taxpayers' Association oppose the measure.