$5-Billion State Bond Package Vote Delayed; Its Fate Left in Doubt

Beset by more political problems than it could handle in one day, the Assembly delayed a vote Thursday on a record $5-billion bond package to finance school, housing, highway, prison and water projects.

Following the Assembly’s lead, the Senate also adjourned without taking action on the bond measures, leaving the fate of the entire bond package dangling precariously.

“We were bringing in lunch. We were prepared to work all day,” Senate President Pro Tem David A. Roberti said, expressing surprise at the Assembly’s adjournment.

Gov. George Deukmejian, who forged a complicated 14-bill agreement with legislative leaders to finance what they consider critical school, prison, highway, housing and water projects, expressed disappointment but remained optimistic.

“Whatever problems exist, they can be resolved,” Deukmejian said.

Likewise, Assembly Speaker Willie Brown (D-San Francisco), who was said to have told one lawmaker that “deals are falling apart all over the place,” said he thinks the bonds will pass. “There is always a confrontation over bonds, and this year isn’t any different,” he said.

Both houses rescheduled floor debates on the bond issues for Monday.

The governor and lawmakers hope to put on the June or November ballots two school construction bonds totaling $1.6 billion, a $1-billion highway funding measure, an $835-million prison construction proposal and a $600-million bond to finance construction projects at community colleges, state colleges and the University of California. Also included in the deal are $450 million in bonds to allow construction or rehabilitation of low-cost housing, a $75-million proposal for public libraries and $350 million for clean water and environmental cleanup projects.

Before it adjourned, the Assembly approved a $510-million bond issue to extend the Cal-Vet veterans mortgage program on a 77-to-0 vote. That bond issue, which would be paid off through mortgage revenues and not general tax revenues like the others, was never in dispute.

There is an understanding that if the Legislature balks at putting even one of the other bond measures on the ballot, all agreements are off and the entire package could be defeated.

Among the complaints surfacing Thursday was the size of the bond deal. Together with a parks bond measure that has already qualified for the June ballot, voters will be asked to approve $6.1 billion in borrowing, nearly twice the amount that has ever been on the ballot in any one year.

Both Republicans and Democrats said they were nervous about the size of the offering, fearing its impact on the financial market as well as on voters.

Another problem is Deukmejian’s proposed $1-billion highway funding bill, which for the first time would finance transportation projects from general tax revenues, rather than highway taxes and user fees.

Affirmative Action

Most Democrats have been reluctant to go along with the new policy, but agreed to it in order to get Deukmejian’s approval for low-income housing, library and other bonds.

Further complicating the picture is a landmark affirmative action bill that Assembly Democrats demanded in order to give minorities and women a significant slice of the financial pie. The bill, already approved by the Senate, would direct 15% of all state contracts to firms headed by minorities and 5% to companies run by women.

This 20% goal would apply to all contracts awarded by the state for construction, professional services, materials, supplies and any other business the state undertakes.

The measure was approved in the Senate last week on a 25-to-4 vote, and support seemed solid in the Assembly.

But the bill’s author, Assemblywoman Maxine Waters (D-Los Angeles), pulled the measure off the floor Thursday and put it in a two-house conference committee for what she said were minor amendments.

Just before she acted, the bill was attacked by one of five dissident Democrats who has been challenging the Democratic leadership in the Assembly.

Measure Attacked

Assemblyman Charles M. Calderon (D-Alhambra), one of the so-called “Gang of Five,” attacked the measure “for not going far enough.”

Other dissident Democrats said they will try to amend the transportation bond issue when it comes up to require that it be financed with highway taxes and user fees.

Deukmejian, commenting later in the day, criticized the Gang of Five and warned that “if they act irresponsibly and they throw roadblocks and obstacles in front of the progress of California, then they’re going to have to answer to that.”

The biggest problem in the Assembly, though, appeared to center on a late-developing issue involving fees on new commercial and residential construction that are assessed on developers to raise money to build new schools.

Lobbyists for major land developers, who have long been dissatisfied with the fees, want the entire state law on fees rewritten because they believe the system is unfair. Among their biggest concerns is a provision that lifts a $1.53-a-square-foot ceiling on fees if a school bond issue is defeated.

Heavy contributors to political campaigns, the developers won support for their demands from Assembly Republicans, who said late last week that they would not vote for any of the bonds unless the problem was resolved.

A two-house conference committee came up with compromise legislation Wednesday night. It caps the fees at $1.53 and makes other concessions demanded by developers. The deal was immediately attacked by advocates for the schools, who said it gives developers too big a break.

Assembly Republican Leader Pat Nolan of Glendale said he felt that the entire bond package would be approved Monday. “It’s acceptable . . . barely,” he said, holding his nose to indicate his distaste for several of the elements of the bond deal.