Institute for Public Finance and Infrastructure Policy at
the University of Southern California hosted its fourth forum in the
series, “Assessing Performance and Progress of California’s 2006
Infrastructure Bonds,” in the wake of the California State Legislature’s
historic passage this morning of a comprehensive water package that
would aggressively address the Golden State’s highly-politicized,
complex water issues.
“The news from Sacramento this morning about the state legislature’s
agreement on a comprehensive water package is a solid attempt to address
the linked issues of water infrastructure and ecosystems enhancement,”
said Richard Little, director of the Keston Institute, in addressing the
forum. “As the funding of these improvements will be decided upon by
voters in November, its vitally important that the public is provided
with free and open forums and assessments of bond measures like the
Keston Institute offered today,” continued Little.
The group reviewed the status of projects three years after California
voters overwhelmingly approved over $42 billion in general obligation
bonds to fund transportation, flood protection, school construction,
housing, and water supply protection.
The group of panelists joining Little included John Decker, executive
director of the California Debt and Investment Advisory Commission;
Bimla Rhinehart, executive director of the California Transportation
Commission; Lynn Jacobs, director of the California Department of
Housing and Community Development; Ron Gastelum, former general manager
of the Metropolitan Water District of Southern California; and Carole
D’Elia, deputy executive director of the Little
Hoover Commission. Nicole
Bullock, capital markets reporter for Financial Times,
moderated the forum.
The majority of the panelists provided updates on how much of the
allocated bond money has made it into existing projects, as well as
perspective on how the state’s budget crises and credit market
difficulties in the past year have impacted the progression of projects
approved under the 2006 measure.
“The future of transportation in the state appears to be all gloom and
doom,” said Rhinehart. “Projects are only funded on a cash flow basis
and dependent upon bond revenue. All other ‘pots’ of funding are at
risk, creating a delicate balancing act under a cloud off uncertainties,
all of which make it difficult to proceed,” continued Rinehart.
Many of panelists echoed Rhinehart’s frustrations, suggesting that
“California voters want it all but just don’t want to pay for it all.” A
result of this, they advised, is that state agencies and organizations
need to find long-term, sustainable sources of funding “without
continuing to use the state bond system as a credit card.”
The results of the budget stalemate from last year will create some
breathing room to address long-term issues, suggested Decker.
Elaborating on his prediction, Decker said that “there will be big
opportunities to bridge difficult divides and make better decisions over
long term” due to an election year, as the legislature and governor will
be “well incentivized to get constructive things done and correct
About The Keston Institute
The Keston Institute for Public Finance and Infrastructure Policy at the
University of Southern California is a non-partisan research center that
actively addresses California and the nation’s public finance and
infrastructure challenges. It is specifically focused on regional and
national transportation and water issues and promoting economic
viability, livability and environmental sustainability.
Together with the Keston Institute, the USC School of Policy, Planning
and Development has created the only educational and policy degree track
in the field of civil infrastructure, with the goal of making USC a
world leader in infrastructure and policy development.
The Institute’s ongoing research is exclusively focused on analyzing
core infrastructure challenges facing California and the nation, while
presenting realistic, objective recommendations to voters and
policymakers. For more information about The Keston Institute, please