Proposition 4 on California’s November ballot calls for borrowing $10 billion to fund scores of environmental proposals.
The Sentinel Editorial Board was divided on the merits of this measure, with some members citing that it is endorsed by the Land Trust of Santa Cruz County and the League of Women Voters of California.
The latter’s endorsement reads: “By funding critical projects, Prop. 4 will enhance resilience, protect communities, and ensure California continues to lead in environmental stewardship and innovation. This investment is essential for a sustainable and prosperous future.”
But here’s the problem with this measure, and why in the end, we’re recommending voters reject it.
After this year’s state budget debacle, elected leaders should not be eyeing new bonds and more debt for an unfocused spending plan. Less than three months ago, to close a $47 billion budget shortfall, Gov. Gavin Newsom and state lawmakers agreed to withdraw $12 billion over two years from the state’s rainy-day fund. That’s roughly 35% of the money in the state’s reserves. The state now is in a weaker position to navigate a future recession.
With that in mind, the last thing California should do is run up its credit card and increase installment payments, especially not for a hodgepodge of programs that unfortunately are more the product of politics than good policy.
As CalMatters explained, “Environmental groups and renewable energy advocates have been clamoring for increased spending on climate change and the environment in recent years,” after lawmakers cut nearly $10 billion from the governor’s $54 billion climate package in 2022.
And there’s nothing wrong with most of Prop. 4’s individual proposals to ensure safe drinking water, strengthen drought, flood and water “resilience,” increase clean energy production, address sea level rise, create parks and outdoor access, provide heat mitigation or fund wildfire prevention programs.
But this measure reads like a shopping list more than a sound policy proposal. Prop. 4 would dole out money to nearly 100 different programs. There’s no sense of priorities or analysis of what would deliver the biggest bang for the buck.
Most state bonds suffer from similar flaws. They promise to fix every manner of problem by “investing” billions of dollars without increasing anyone’s tax bill. However, they rack up state debt and spend money inefficiently.
Bonds also create pressure for politicians to raise taxes in the future as debt payments crowd out the discretionary budget. The state already owes installments on around $84 billion in bond debt. Lawmakers continue to put additional measures on the ballot because it’s politically easier to float debt than make tough choices about cutting elsewhere.
As it is, during the past decade, the state has spent an average of $13 billion each year on natural resources and climate activities, according to the nonpartisan Legislative Analyst’s Office. About 15% of that has come from borrowing money through bond offerings.
Since 2000, California voters have approved eight other measures granting permission for the state to issue a total of $29 billion in bonds for environmental projects. But that’s not free money. The state’s annual payment for environment-related bonds is now roughly $1.4 billion. Prop. 4 would add about another $400 million to those payments for each of the next 40 years. Those would be locked-in expenditures that come from the already tight state budget, squeezing out funding for other programs.
To be sure, as climate change intensifies, we need to smartly address environmental issues. But that’s not what we have here. Rather, Prop. 4 is divided into eight different spending categories — which are in turn subdivided into various spending allocations designed to placate political constituencies rather than ensure efficient and effective allocation of precious funds.
Voters should send a message they want better and vote No on Proposition 4.
The Bay Area News Group contributed to this Editorial.