Legislative Analyst's Office, December 2002
California's Economy and
Budget in Perspective
2002 Cal Facts
Part 8: Capital Outlay
Debt Service Ratio to Stay
In Moderate Range
- The state's debt service
ratio reflects the costs to pay principal and interest on state bonds as
a percentage of projected General Fund revenues. California's
ratio peaked at 5.4 percent in the early 1990s, before declining in
the second half of the decade.
- We estimate that if all bonds that have been authorized
through November 2002 are sold, the debt ratio will increase to a
peak of 5.2 percent in 2004-05.
- If the additional $22 billion in school and transportation
bonds that will be placed before the voters in 2004 are approved
and sold, the ratio would still remain in a moderate range, peaking
at 5.7 percent in 2007-08.
Trends in State Capital Outlay
Spending Over Time
- Real per capita spending on
state-supported infrastructure declined rapidly in California
between 1966-67 and 1981-82. This decline reflected a reduction
in spending on major programs such as transportation and
- Per capita spending has increased steadily since the early 1980s,
but the $132 per capita the state plans to spend for capital outlay
in 2002-03 is less than half the level (adjusted for inflation) the
state spent in 1966-67.
- Recent increases in per capita spending on infrastructure
has been due to the extensive use of lease payment bonds and
general obligation bonds for education, resources, and other purposes.
Geared Towards Transportation and Education
Dollars in Billions
(2002-03 Through 2006-07)
- The administration released
in June 2001 its first comprehensive infrastructure plan. The
plan provides detail on the administration's proposed
capital outlay projects for the 2002-03 through 2006-07 period.
- Of the proposed $56 billion in spending over the period,
half would be in transportation and over one-third in education.
- While transportation projects would be financed almost
entirely with federal funds and state special funds, education projects
would be financed principally by General Fund-supported bonds.
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