November 2, 2004 Ballot Prop. 60A

Introduction

Proposition 60A would require that funds from the sale of surplus state property be used to pay down the $15 billion in deficit bonds included in the 2003-2004 budget package.

Current California law requires state agencies to assess annually their property holdings. Unused and underused property is deemed surplus property and may be sold. When it is sold, the money is deposited into the account that originally paid for the property. In most cases the receiving account is the state's General Fund. According to the Legislative Analyst, proceeds from the sale of surplus property have averaged about $30 million annually in recent years and "are not a major source of General Fund revenue."

The $15 billion in deficit bonds that Proposition 60A would pay down were authorized by the voters as Proposition 57 in the March 2004 primary. The bonds are to be repaid from General fund sources over a period of up to fourteen years.

Proposition 60

In paying down Proposition 57 bonds with surplus state property sales, Proposition 60A would reduce the amount of interest paid on the bonds over the life of the repayment period. The Legislative Analyst estimates that the interest savings would be "in the low tens of millions of dollars" and that the repayment period would be shortened by "a few months."

Proposition 60A has an unusual history. It began as a provision of Proposition 60, which was placed on the ballot by the legislature as SCA18. SCA18 is primarily a constitutional amendment that would preserve the state's current primary election system, which is a version of the "closed" primary. In the current system the top vote getters of each party advance to the general election. The legislature's intent in placing SCA18 on the ballot was to provide an alternative to Proposition 62, which would change the primary election system to a version of the "blanket" primary. Under Proposition 62, all candidates would appear on a single primary ballot, and the top two vote getters--regardless of party--would advance to the general election. SCA18 was rushed through the legislature just ahead of the deadline for placing measures on the November general election ballot, and met the two-thirds vote requirement for such measures with wide bipartisan support.

SCA18 became Proposition 60 on the general election ballot, and was immediately challenged in court on the ground that it violated the state constitution's ban on multi-subject ballot measures. Petitioners in Californians for an Open Primary v. Shelley (2004 Cal. App. Lexis 1259) sought its removal from the ballot altogether. In a July 30, 2004 decision, the California Third District Court of Appeal allowed Proposition 60 to stay on the ballot, but ordered that it be split into two separate propositions. On August 3, 2004 Secretary of State Kevin Shelley announced that the "surplus state property" provision would become Proposition 60A on the November ballot. On August 9, 2004, with the deadline for printing the Official Voter Information Guide looming, the California Supreme Court let stand the appellate court decision bifurcating Proposition 60, but agreed to review the legal issues at a later time, after "adequate briefing, oral argument and deliberation." The end result of the litigation is that both Propositions 60 and 60A remain on the general election ballot as single-subject measures.

The official ballot argument for Proposition 60A urges its passage on the ground that it will reduce the cost of the Proposition 57 deficit bonds. The counter-argument urges its rejection on the ground that it is a weak measure that does not force "the sale of the hundreds of millions of dollars worth of surplus property the state owns," but requires only that proceeds of such sales go to the bond debt.

As of late August 2004 there were no organized campaign committees or websites supporting or opposing Proposition 60A.

Official Voter Information

Voter Information Guide

Campaign Finance: 
Individual Campaign Committees
Total Contributions and Expenditures (select "Nov. 2004 election" and "Prop. 59" in dropdown boxes)

Key Websites

Ballotpedia
League of Women Voters