Yes on state bonds
There’s something undeniably alluring about a bullet train -- the technology is so powerful, the speed so breathtaking, it makes quotidian trips seem exotic. Perhaps that’s why proponents of Proposition 1a, which would authorize $9.95 billion in bonds for a high-speed rail line connecting Northern and Southern California, think it would be wildly successful. They predict the line could draw 117 million riders a year by 2030, compared with 3 million now taking the high-speed Amtrak train in the densely populated Boston-Washington corridor. And they say it will turn a billion-dollar profit by then even as it keeps ticket prices remarkably low.
The projections by the measure’s opponents, led by the libertarian Reason Foundation in Los Angeles, are much less sanguine and more persuasive. If voters approve Proposition 1a, it seems close to a lead-pipe cinch that the California High-Speed Rail Authority will ask for many billions more in the coming decades, and the Legislature will have to scrape up many millions of dollars in operating subsidies.
And yet, we still think voters should give in to the measure’s gleaming promise, because it’s in their long-term interest. Weaning travelers from gas-powered, road-choking cars is critical to the state’s health and competitiveness. A high-speed rail line would not only provide a cleaner and faster alternative to automobiles, it would encourage transit-friendly development.
Prop. 1a: High-speed rail line
The measure isn’t as big a risk as it would be if the state were footing the entire bill. The “backbone” segment from Los Angeles to San Francisco is projected to cost $33 billion, with about 75% from federal and private sources. Until those funds are secured, the state won’t issue most of its bonds. If the line never gets built, the state’s losses will be well under $2 billion. That’s not too much to wager on a visionary leap that would cement California’s place as the nation’s most forward-thinking state.
Prop. 3: Children’s hospitals
Proposition 3, which would authorize nearly $1 billion in general obligation bonds to benefit hospitals that treat seriously ill children, is a testament to the problems in the state’s healthcare system and the need for comprehensive reform. We’d rather see a broad proposal to rationalize how Californians pay for and receive healthcare, but that’s not an option this year. Instead, we have to deal with the inefficiencies and imbalances as best we can, and Proposition 3 is a necessary part of that effort.
Money from the bonds would be available for construction, equipment and other capital expenses at five teaching hospitals in the University of California system and, presumably, eight private, nonprofit children’s hospitals across the state. These include five in Los Angeles and Orange counties: the Mattel Children’s Hospital at UCLA, the University Children’s Hospital at UC Irvine, Children’s Hospital Los Angeles, Miller Children’s Hospital in Long Beach and Children’s Hospital of Orange County. Although the proposition has limited protections against overspending, it would require state regulators to review applications for the bond money and grant only the ones that improve and expand access to child healthcare.
Many of these institutions have large endowments and prodigious fundraising capabilities. And yet, only four years after persuading voters to support a $750-million bond issue, almost $350 million of which remains unspent, they’ve come back to voters for an additional $980 million. The Times’ editorial board opposed the previous request, arguing that there was no guarantee the bonds would result in more medical care for anyone.
At least two things have changed since then, however: Construction costs are rising, and more uninsured or state-insured children are being sent to these institutions for care. About 55% of their revenue comes from treating youths insured by Medi-Cal. The rates paid by Medi-Cal are so low, supporters of the proposition say, that hospitals have barely enough to cover their operating expenses -- and virtually nothing for capital improvements. Because the state relies disproportionately on these institutions to treat the children it insures, the state has to assume some of the responsibility for maintaining and upgrading their facilities.
Prop. 12: Homes for vets
For the 27th time since 1922, California voters are being asked to approve a bond issue to help veterans buy homes. This year’s request, Proposition 12, is the largest ever -- $900 million. Yet voters should not hesitate to do what they’ve done 26 times before: Vote yes.
The money would replenish funds in the CalVet Home Loan program, which provides mortgages to military veterans at below-market interest rates. The tax-free bonds authorized by this proposition would cost an estimated $1.8 billion over 30 years, but the principal, interest and expenses would all be covered by the borrowers. There’s no direct cost to the general public, just the indirect cost of tax revenue foregone on the bonds.
Granted, taxpayers would be stuck with the bill if borrowers defaulted in great numbers. But even in the current downturn, the chances of the program not covering its expenses seem remote, given its low default rate and aggressive efforts to work with troubled borrowers. Revenue from the new bonds would enable about 3,600 additional veterans to buy homes. And thanks to a recent change in federal law, the most attractive of the loan offerings would finally be available to wartime veterans who joined the service after 1977.
Opponents of Proposition 12 are in short supply. Both houses of the Legislature voted unanimously to put it on the ballot, and the state Republican and Democratic parties have endorsed it. Attorney Gary Wesley, who wrote the opposition statement for the official voter information guide, argued that the program should be limited to veterans who saw combat. But as proponents point out, even during peacetime, the military may be pressed unexpectedly into service. Anyone who devotes part of his or her life to military service deserves access to this program.
For information on previous endorsements, log on to the Opinion section’s Vote-o-rama at latimes.com/news/opinion/elections.
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