August 11, 2003
Figure 1 Major State Infrastructure |
|
Program Area |
Major State Infrastructure |
Water Resources |
· 32 lakes and reservoirs. · 17 pumping plants. · 3 pumping-generating plants. · 5 hydro-electric power plants. · 660 miles of canals and pipelines. · 1,595 miles of levees and 55 flood control structures in the Central Valley. |
Transportation |
· 50,000 lane miles of highways. · 9 toll bridges. · 11 million square feet of Department of
Transportation · 209 Department of Motor Vehicles offices. · 138 California Highway Patrol offices. |
Higher Education |
· 192 primary and satellite campuses of higher education, including 10,000 buildings containing 138 million square feet of facilities space. |
Natural Resources |
· 266 park units containing 1.4 million acres and · 238 forest fire stations and 13 air attack bases. · 21 agricultural inspection stations. |
Criminal Justice |
· 33 prisons and 38 correctional conservation camps. · 11 youthful offender institutions. · 12 crime laboratories. |
Health Services |
· 4 mental health hospitals comprising over 4 million square feet of facilities and 2,300 acres. · 5 developmental centers comprising over 5 million square feet of facilities and over 2,000 acres. · 2 public health laboratory facilities. |
General state |
· 8.5 million square feet of state-owned office space. · 16.6 million square feet of leased office space. |
The state needs to renovate and replace existing facilities in order that they can continue to serve their intended purposes. In addition, as the state's population continues to increase, the need for investment in new capital facilities will also grow. Over the next five years, California has an estimated $54 billion in identified state infrastructure needs.
Funding for State Infrastructure. Traditionally, the state has funded its infrastructure projects in the following ways:
Figure 2 Basic Provisions of Proposition 53 |
Purpose |
· Establishes the California Twenty-First Century Infrastructure Investment Fund (Infrastructure Fund). |
· Commits a percentage of the General Fund for “pay-as-you-go” infrastructure projects. |
|
Scheduled Transfers to the Infrastructure Fund |
· Transfers 1 percent of General Fund revenue to the Infrastructure Fund beginning with the 2006-07 fiscal year. |
· Gradually increases the amount of General Fund committed to the Infrastructure Fund. |
· Delays scheduled increases when General Fund revenue growth slows. |
· Accelerates scheduled increases by one year when General Fund revenues increase significantly |
· Caps annual General Fund transfers to the Infrastructure Fund at 3 percent of General Fund revenues. |
|
General Fund Revenue Triggers |
· Some trigger mechanisms reduce transfers to the Infrastructure Fund during periods when estimates of General Fund revenue growth decline. |
· Other trigger mechanisms eliminate transfers to the Infrastructure Fund when General Fund revenues decline. |
Special Adjustments |
· School Funding—Reduces transfer amount when the percentage growth in the Proposition 98 guarantee exceeds the percentage growth in General Fund revenues. |
· Bond Debt Service—Caps the Infrastructure Fund transfer to the difference between 7.5 percent and the percentage of General Fund revenue devoted to prior-year debt payments for infrastructure-related bonds. |
|
Scheduled Transfers. Beginning with the 2006-07 fiscal year, this measure would transfer 1 percent of General Fund revenue to the newly established California Twenty-First Century Infrastructure Investment Fund (Infrastructure Fund). The amount of the transfer would increase by 0.3 percent annually under specified conditions until reaching a maximum of 3 percent of General Fund revenues in 2013-14 (see Figure 3). The initial 2006-07 transfer and any incremental increases in subsequent years would only take place if General Fund revenues grew by at least 4 percent (after adjusting for inflation) when compared to the previous year. (Thus, assuming an inflation rate of 3 percent, it would take revenue growth of 7 percent to trigger these increases.) Transfer rates would remain the same in those years that the revenue growth target is not met. On the other hand, the scheduled transfers would be accelerated by a year when General Fund revenues increased by 8 percent or more (after adjusting for inflation) when compared to the previous year.
Figure 3 Proposition 53 |
|
Fiscal Year |
Percentage of |
2006-07 |
1.0% |
2007-08 |
1.3 |
2008-09 |
1.6 |
2009-10 |
1.9 |
2010-11 |
2.2 |
2011-12 |
2.5 |
2012-13 |
2.8 |
2013-14 and thereafter |
3.0 (maximum rate) |
|
|
a Transfers would depend on meeting specified
conditions |
The measure requires the Legislature to allocate annually the moneys in the Infrastructure Fund for capital outlay purposes—50 percent for state-owned infrastructure and 50 percent for local government infrastructure. The measure requires the Legislature, in subsequent legislation, to set forth the approach and method to be used in the annual allocation of the Infrastructure Fund for local government infrastructure projects. The local funds could go for any capital outlay purpose except for K-12 school and community college projects, which presumably would continue to receive funding from state bond measures.
Revenue Triggers. Proposition 53 contains a variety of adjustments or “triggers” that would reduce or eliminate the transfer to the Infrastructure Fund when General Fund revenue performance is poor or less than estimated.
Special Adjustments. The measure also contains the following special adjustments that could serve to limit the amount of an otherwise scheduled transfer to the Infrastructure Fund: