Voters agreed in November to use bonds to subsidize new, affordable housing in California. They knew Proposition 1C would put the state $2.8-billion deeper in debt, but they found the price worth paying in order to spur cities and counties to clean up polluted or derelict lots and turn them into places where Californians could afford to live. They did not intend to subsidize for-profit commercial developers like Anschutz Entertainment Group, which already enjoys millions of dollars in public money and tax breaks extended by elected officials trying to attract new construction.
With public scrutiny -- the kind that rational and open legislative hearings provide -- Assembly Bill 1053 might well have been crafted to eliminate suspicion that a high-rolling company that dispenses campaign donations freely was trying to subvert a public bond measure with sneaky after-the-fact amendments. After all, affordable housing works best when it is built where people want to live, and AEG’s downtown projects may make those once-forlorn areas more attractive to urban dwellers while creating jobs they can reach without a long freeway drive.
Instead of a rational and deliberative process, however, the bill opening up Proposition 1C money to business improvement districts -- such as the one controlled by AEG -- was rushed through Sacramento after midnight on Wednesday in the final minutes of the legislative session.
That kind of action undermines public confidence in the bond process and is exactly the wrong note on which to launch this month’s special session to draft and send voters a water bond.
Bait-and-switch raids on public funds are epidemic. Gov. Arnold Schwarzenegger diverted gasoline sales taxes and back-filled transportation projects out of last year’s $20-billion Proposition 1B bond. After killing funding to treat homeless mentally ill people, Schwarzenegger told counties to take funds from the “millionaire’s tax” that voters in 2004 were promised would only supplement existing programs. Lawmakers extracted museum funding out of the Proposition 84 water bond. Now Proposition 1C has been re-tailored by lawmakers for the benefit of AEG.
Any discussion of a water bond will already be uncomfortably clipped. Key senators have to catch a plane to South America; some Assembly members will return from China on the last possible day to vote. Californians have little reason to support another rush job on more public debt. That’s something Schwarzenegger should keep in mind as he decides whether to sign Wednesday morning’s bill reshaping the housing bond.