Low-Profile Race Offers Voters a Clear Philosophical Choice

California voters may have strong opinions on abortion and capital punishment, but they aren’t focused much on who invests the state’s money, including $230 billion in employee pension funds.

Phil Angelides, a former state Democratic Party chairman, has raised $3 million to tell voters why they should care about who becomes the next state treasurer--and why they should vote for him instead of his Republican rival, Assemblyman Curt Pringle.

The race between the two political veterans is neck-and-neck, according to statewide polls, including a Times poll last month. But 40% of those most likely to vote still haven’t made up their minds, the polls show.

The two candidates differ markedly on several major issues as to where investments are made and how best to raise funds to build schools, rebuild roads and make other major public improvements.

This week, Angelides will start spending $1 million on a television advertising campaign in Northern California and San Diego to tout his run for office. The ads will hit the rest of Southern California the following week.

Pringle collected nearly $2 million through the end of September. He said his campaign plans to hit the airwaves later this month.

This year’s race for treasurer is lagging behind even the usual disinterest. The sex scandal involving President Clinton “froze everything for a month,” said Tony Quinn, a Sacramento political consultant for Republicans. “People will probably decide late on what to do with this race.”

Up to now, the treasurer’s race has had such a low profile that Pringle suspended campaigning during the last two weeks of August to complete his final state budget duties as a legislator.

Despite the late start, Californians have a clear choice on Nov. 3 in what philosophies and strengths the two major candidates carry.

Pringle, 39, of Garden Grove, ran the family drapery business in Anaheim before being elected to the Assembly in 1988. He is a conservative who believes state investment decisions should be based only on the bottom line. Any other reason is an unwanted intrusion of social policy, he said, citing the state’s divestment of South Africa holdings in 1986 because of that country’s racist policy of apartheid, which has since been abolished.

He told delegates at the state Republican convention last weekend that his greatest qualification for election is that he is a conservative.

“The No. 1 responsibility of the state’s fiduciary position is to get the highest and safest returns,” Pringle said. “The office should be trusted to someone who will be a steward of taxpayer money.”

Angelides, 45, a Sacramento developer who served as the state’s housing administrator under former Gov. Edmund G. “Jerry” Brown Jr., believes California is obligated to use its money for public investments in building schools and rebuilding roads. He has proposed cataloging the state’s capital needs, putting price tags on them and letting voters decide which should be funded.

He supports shunning unpopular investments in such fields as the tobacco industry. He wants to boost state pension fund investments in California businesses from 10% of the fund to 15% or more--a concept Pringle supports, though he opposes setting “an arbitrary threshold.”

“A good fiduciary says, are there better places to put our money that have [the same] safety and yield” as existing investments, Angelides said. “I want to be someone who manages the finances of our state well and does it in a way that builds our economy.”

There are some areas where the two agree. Among them is that the treasurer’s office, though largely powerless to do more than lobby the Legislature, should prepare a list of the state’s most pressing capital needs over the next decade.

The California Business Roundtable estimates that the state should invest $90 billion over the next 10 years for needed work on streets, bridges and public buildings, devoting up to $25 billion of that amount to transportation improvements.

But the Roundtable figures the state will be able to budget only $54 billion for improvements over the next decade.

The state Department of Finance comes up with slightly different numbers, but still sees a $29-billion shortfall in the amount needed.

How to cover that shortfall is one issue that separates the candidates. Angelides supports selling general obligation bonds, while Pringle is more cautious about issuing additional state debt.

Pringle, for instance, opposes Proposition 1A, which would authorize $9.2 billion in bonds to pay for new schools. He said it would nearly double the current debt load.

But Angelides said the investment is critical for the state’s future, and he supports the proposition, which is on the Nov. 3 ballot.

“There are a variety of areas where long-term debt is necessary,” Pringle said, “but you can’t sell $9.2 billion in bonds all at once.”

Differences on School Bonds

Pringle supports parceling out school needs by priority and selling bonds initially for only the greatest needs. Subsequent bond issues could be authorized later, he said.

Both candidates believe that Wall Street rating agencies must be persuaded to boost the state’s credit ratings, which would lower the state’s cost of borrowing money. Of 41 states rated, California ranks 39th for general obligation bonds. California holds A1 rating from Moody’s Investor Services, A-plus from Standard & Poor’s and AA-minus from Fitch IBCA Inc.

The relatively low ratings have persisted even though the state’s economy has rebounded from the recession of the early 1990s.

Angelides blames the poor ratings on eight years of budgets under Gov. Pete Wilson, who yanked funds from local governments, borrowed money from schools and pension funds and depleted state reserves.

“State government showed an inability during the ‘90s to truly balance the budget,” Angelides said.

Pringle says the fault is a lack of sound fiscal management by Democratic legislative leaders who, he said, repeatedly have blocked timely passage of state budgets.

Campaigns Attack Political Pasts

He acknowledged that the state’s 1993-94 budget, for which he voted, was criticized by Wall Street as out of balance with too much internal borrowing.

The resurgent economy produced a $4.4-billion surplus recently, and the two candidates split along party lines on what to do with it. Angelides said the money should have been used to build and repair schools. Pringle backed the $1.4-billion cut in vehicle license fees, plus an additional $2 billion to schools and $1 billion to state reserves.

Pringle’s campaign materials are filled with references to his authorship and promotion of four tax cuts totaling more than $2 billion. The governor refers fondly to Pringle and even provided a rare primary endorsement for Pringle over GOP challenger Assemblyman Jan Goldsmith of Poway.

But at Democratic Party offices in Sacramento, Pringle is known mainly for one thing: playing a large part in the GOP’s hiring of uniformed security guards at largely Latino polling places during his first Assembly race in 1988.

Pringle’s campaign paid for the stark red-and-white signs that many of the guards held aloft. The signs stated: “Noncitizens can’t vote” in English and Spanish. The party and Pringle eventually settled a resulting civil-rights lawsuit for $400,000.

These days, Pringle calls the incident part of his political past. More relevant to voters deciding his suitability for the job, he said, is his track record of fiscal review in the Legislature.

He also points out that Angelides has been hit with a flurry of lawsuits that resulted from the construction of Laguna West, a development outside Sacramento built in part by Angelides, who still manages it. Owners of custom-built homes said they weren’t told about lower-cost housing later built in the project, which they said diminished their property values.

Democrats Cross Lines to Back Pringle

Before a ballroom full of delegates at the state GOP convention, Pringle branded Angelides a “wheeler-dealer developer” who sold his stake and took his profits before millions of dollars in improvement bonds were due.

For his part, Angelides touts Laguna West as a local success story and national blueprint for innovative post-suburban development by blending low- to higher-priced housing with manufacturing plants, parks and shopping centers. He offered evidence of its success: awards and commendations from the development industry for the project.

The project’s critics, he said, are a dozen homeowners--out of 2,000--who filed lawsuits against Angelides and fellow developer Angelo Tsakopoulos.

“If the best he can do is attack a project of mine that’s been so acclaimed, I’m in pretty good shape,” Angelides said. He said he sold his interest in several projects to run for office.

But Angelides also faces problems in his own party. Some Democrats remain irritated with him for his last-minute campaign tactics four years ago when he ran for treasurer in the primary against former state Sen. David Roberti, a Democrat opposed to abortion.

An Angelides television ad showed news footage about the murder of a doctor by an anti-abortion activist, stating at the same time that Roberti had voted against a resolution calling for better protection of abortion clinic workers. Roberti deplored the death and was angered by the linking of it with his vote, pointing out that his vote had occurred several years before the killing.

This year, some Democrats are crossing over to support Pringle.

Earlier this month, Roberti’s wife, June, co-sponsored a Hollywood fund-raiser for Pringle. And the two candidates Angelides defeated in last June’s primary endorsed Pringle.

So far, the most pointed attacks by each candidate have come through press releases and party surrogates. In five face-to-face meetings, the two have been cordial and polite. They are scheduled to appear together Thursday in San Diego at a debate sponsored by the Bond Buyer financial newspaper.

The other candidates for the seat are Libertarian Jon Peterson, American Independent nominee Edmon Kaiser, Natural Law nominee Carlos Aguirre, and Peace and Freedom nominee Jan Tucker.

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Phil Angelides

Angelides served as chairman of the state Democratic Party from 1990-93. He won the party’s nomination for state treasurer in 1994 but angered some fellow Democrats with his hard-hitting ads against arival in a primary campaign.

* Born: June 12, 1953

* Residence: Sacramento

* Education: Graduated from Harvard University with a bachelor of arts degree in government.

* Career highlights: Housing administrator for former Gov. Edmund G.”Jerry” Brown Jr. Chief of staff for former Assembly Majority Leader Mike Roos (D-Los Angeles). A developer, he served as lead negotiatorin 1997 to keep the National Basketball Assn.’s Kings in Sacramento.

* Quote: “What we need for California is a capital investment plan that lays out for voters the critical needs for schools, for transportation, for parks -that public fabric that underlies a successful society.”

Curt Pringle

An Orange County legislator since 1988, Pringle prevailed in a power struggle to become speaker of the Assembly in 1996, a job he lost when the GOP lost the majority in the 1996 elections. In the past 10 years, his reputation has grown from that of back-bench ideologue to a key Republican legislative leader.

* Born: June 27, 1959

* Residence: Anaheim

* Education: Graduated from Cal State Long Beach, with a bachelor’s degree in business administration and a master’s degree in public administration.

* Career highlights: Elected to the state Assembly for four of the last five terms. Served as Assembly speaker and Assembly minority leader.

* Quote: “It is important who invests our state resources and who sells our state bonds. We need to make sure the office is in the hands of a fiscal conservative.”