Crosscutting Issues
Capital Outlay
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Infrastructure Planning And Financing
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The state needs to overhaul its process for planning, budgeting, and financing infrastructure. The Governor's establishment of a commission to
examine this complex issue is a welcome first step. The commission faces a difficult challenge, however, to recommend a comprehensive bond
package by May 1.
In our December 1998 report, Overhauling the State's Infrastructure Planning and Financing Process (reprinted in the 1999-00 Budget: Perspectives and
Issues), we discuss the challenge the state faces to address its infrastructure needs in order to sustain a growing economy and population. To effectively
meet this challenge, the state needs a well-defined process for planning, budgeting, and financing necessary infrastructure improvements.
Unfortunately, the state's current capital investment process suffers from a myriad of problems:
- Neither the administration nor the Legislature evaluates statewide infrastructure needs and infrastructure investment as a program in and of itself.
- Proposals are reviewed in isolation of each functional area--an approach that does not allow examination of how competing proposals fit within a
context of overall state infrastructure needs, priorities, and funding capabilities. The result is that capital investment decisions are made more on an ad
hoc basis. The state lacks a stable funding source for its infrastructure programs. Thus, infrastructure investment suffers great variability and
uncertainty even though the need to address infrastructure deficiencies is significant and ongoing. This has led to an underinvestment in the state's
infrastructure.
To address these problems, we recommend that the Legislature overhaul the planning, budgeting, and financing of the state's infrastructure by:
- Developing an integrated statewide infrastructure plan.
- Adopting a policy that dedicates 6 percent of annual General Fund revenues to infrastructure investment and provides greater annual resources on a
pay-as-you-go basis.
- Establishing legislative committees to oversee development and financing of the statewide infrastructure plan.
Governor's Proposed Commission
The Governor has also recognized the need to improve the planning and financing process in order to meet the state's infrastructure needs. To begin the
development of a comprehensive multiyear plan, the budget stipulates that the Governor will establish a Commission on Building for the 21st Century by
mid-February. According to the budget document, the commission will study the building needs of California for the next decade and will review several
issues, including those listed in Figure 1.
The commission is to submit an initial report to the Governor by May 1, with its recommendation for "a comprehensive multi-year bond package to be
placed on the 2000 ballot." The budget describes this as the first step in an effort to meet the state's public infrastructure needs. We applaud the Governor's
proposal to begin addressing the state's infrastructure from a comprehensive and long-term perspective.
Given the general inadequacies in current planning and the need to determine the state's appropriate role in funding local infrastructure programs, the
commission faces a difficult task to report back by May 1 with a comprehensive bond package. In view of the importance of this issue, however, every
effort should be made by the administration and the Legislature to have the necessary planning and policies in place to develop an appropriate financing
scheme by this fall. This will ensure that bond packages addressing the state's highest priority needs can be developed for future ballots.
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Managing the Capital Outlay Program
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Preliminary plans are not complete for 111 previously funded projects that are proposed in the budget for working drawings and/or construction
funding. We recommend approval of these 111 projects contingent on completion of preliminary plans that are consistent with the cost and scope
previously approved by the Legislature. Because most of the projects funded in the current year are behind schedule, we recommend partial or full
deferment of almost all new major capital outlay projects that would be managed by the Departments of General Services and Parks and Recreation.
We also recommend that the Department of General Services (DGS) report to the budget committees on steps that could be taken to improve its ability
to maintain project schedules. Because this issue affects several departments, we suggest that the budget committees consider hearing this issue in full
committee or in a subcommittee that would review the entire capital outlay program.
Preliminary Plans Not Complete on Prior-Year Projects
We recommend approval of $382,188,000 for working drawings and/or construction for 111 projects contingent on completion of preliminary plans
that are consistent with the cost and scope previously approved by the Legislature.
Our analysis indicates that the amounts proposed in the budget for 111 projects previously funded for acquisition, preliminary plans, and/or working
drawings are consistent with prior legislative actions. These 111 projects involve 13 different departments. Figure 1 shows the number of projects and the
budget totals for each department. The preliminary plans for these projects, however, had not been completed at the time this analysis was prepared.
Therefore, we recommend approval contingent on receipt of completed preliminary plans that are consistent with the legislatively approved scope and
cost.
| Figure 1 |
| Preliminary Plans Not Completed |
| (Dollars in Thousands) |
| Item |
Department |
Number of
Projects |
Budget Bill Amount |
|
|
|
|
| 1760 |
General Services |
1 |
$21,098 |
| 2740 |
Motor Vehicles |
1 |
6,669 |
| 3540 |
Forestry and Fire Protection |
11 |
12,564 |
| 3680 |
Boating and Waterways |
4 |
4,048 |
| 3790 |
Parks and Recreation |
4 |
2,811 |
| 4300 |
Developmental Services |
1 |
1,000 |
| 4440 |
Mental Health |
1 |
16,887 |
| 5100 |
Employment Development |
1 |
2,079 |
| 5240 |
Corrections |
40 |
144,047 |
| 5460 |
Youth Authority |
18 |
29,218 |
| 6440 |
University of California |
2 |
44,207 |
| 6870 |
Community Colleges |
26 |
90,694 |
| 8570 |
Food and Agriculture |
1 |
6,866 |
|
Totals |
111 |
$382,188 |
|
|
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Defer Most New DGS-Managed Projects
We recommend deletion of $27.9 million for 77 new projects from various funds because the Department of General Services cannot manage these
new projects in addition to its ongoing workload. The department should report to the budget committees on steps that could be taken to improve its
ability expedite the delivery of capital outlay projects.
With the exception of higher education facilities and highway construction, the management of most other major capital outlay projects for state
departments is done by the DGS. Most of these projects are designed by private sector architectural/engineering firms and built by private contractors.
Project directors at DGS are responsible for (1) coordinating all work done by designers and contractors and (2) keeping projects on schedule and within
the legislatively approved scope and cost.
Since last year, the number of projects being managed by DGS, as listed in its quarterly project status report, has increased from 185 to 271, or an
increase of 46 percent. This increase is generally due to the relatively large number of new capital outlay projects that were funded in the 1998-99 Budget
Act. In order to address this increased workload, the budget authorized 15 new project director positions. Furthermore, the department notified the
Legislature in October 1998 that it was using authority contained in provisional budget language to establish an additional nine project director positions.
Given the time necessary to hire qualified personnel for these positions, the DGS did not have sufficient staff to begin work on many of the new projects
upon enactment of the budget. (Unless the design is to be done by state staff, the initial work on a new project involves advertising, selecting, and
negotiating a contract with a design firm.) Moreover, of the 24 recently authorized project director positions, 14 were still vacant at the time this analysis
was written. Of the 111 projects referred to in Figure 1, the DGS is managing 73 projects, or 66 percent, of the total. Almost all of these projects managed
by the department are behind schedule, with preliminary plans to be completed between March and June 1999 instead of November and December 1998
as originally scheduled.
For 1999-00, the DGS will face a significant challenge to manage the state capital outlay program. This workload has three basic components: (1) the
working drawing and/or construction phases--as proposed in the budget--for the 73 DGS-managed projects summarized in Figure 1; (2) other ongoing
projects, such as various new state office buildings, that are already authorized for construction and in some cases are under construction; and (3) 94 new
projects proposed in the budget. Given the magnitude of its ongoing workload, we recommend that most of the new DGS-managed capital outlay projects
proposed for 1999-00 be deferred. Many of these new projects are meritorious capital improvements that should be funded in the future. The appropriation
of funds for a capital program, however, should only be made to the extent the program can be implemented in a timely manner to spend those funds.
There has to be a balance between the capital program and the ability to undertake and manage it. We believe that deferral of most new projects for one
year will help bring the program into balance using authorized project management resources.
Figure 2 lists the number of new projects that we recommend deferring for each department in 1999-00. In our analyses of individual departments' capital
outlay programs (later in this chapter), we also recommend deletion of certain projects or reductions to the amount proposed for some projects for reasons
other than this management workload concern.
The administration's proposal to proceed with many new capital improvements at state facilities is laudable, but we believe, unattainable for 1999-00. We
intend to work with the DGS and the Department of Finance (DOF) to examine how management resources could be kept in better balance to successfully
implement the state capital outlay program. We recommend, as one step, that the DGS report to the budget committees on ways it could deliver projects
more expeditiously. One possibility the department should consider is contracting with private sector individuals or firms with project director capabilities
in order to meet workload peaks.
| Figure 2 |
| New DGS-Managed Capital Outlay Projects
Recommended for Deferral |
| (Dollars in Thousands) |
| Budget Item |
Department |
Number of Projects |
Budget Bill
Amount |
|
|
|
|
| 0820 |
Justice |
1 |
$710 |
| 1730 |
Franchise Tax Board |
3 |
963 |
| 1760 |
General Services |
1 |
275 |
| 2660 |
Transportation |
1 |
604 |
| 2720 |
Highway Patrol |
5 |
3,499 |
| 3540 |
Forestry |
45 |
15,881 |
| 3680 |
Boating and Waterways |
2 |
175 |
| 5100 |
Employment Development |
2 |
497 |
| 5240 |
Corrections |
6 |
1,806 |
| 5460 |
Youth Authority |
3 |
819 |
| 6110 |
Education (special schools) |
2 |
860 |
| 8570 |
Food and Agriculture |
1 |
411 |
| 8940 |
Military |
3 |
944 |
| 8960 |
Veterans' Home |
2 |
410 |
|
Totals |
77 |
$27,854 |
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Partially Defer Some New DGS-Managed Projects
We recommend a reduction of $8.1 million from the General Fund to defer phases of ten new projects and to reduce the amount provided for
unallocated capital outlay because the Department of General Services cannot manage its ongoing workload and implement all phases of these
projects that are proposed in the budget.
In evaluating all of the new projects proposed for 1999-00, our review indicates that several projects should proceed in the budget year for various
reasons. These projects are listed in Figure 3. In general, the projects in the figure address safety or security problems or can be accomplished with little
impact to DGS' project management workload. While we believe that work on these projects should move forward in the budget year, given the DGS'
large workload, we recommend the Legislature defer some of the project phases until the 2000-01. In general, our recommendations would (1) fund the
acquisition phase and/or the preparation of preliminary plans and (2) defer the working drawing and/or construction phases.
Unallocated Capital Outlay. The budget also includes $1 million under Item 9860-301-0001 for unallocated capital outlay. These funds are provided to
the DOF, but are mainly spent by DGS to prepare cost and scope estimates (referred to as budget packages) for future projects that DOF determines are
meritorious for state funding. Because we recommend deferring most of the new projects proposed in 1999-00, there will be fewer additional projects
needing budget packages for the 2000-01 budget. We therefore recommend reducing the unallocated amount to $500,000, as shown in Figure 3.
| Figure 3 |
| Projects Recommended for Partial Deferral |
| (In Thousands) |
| Item--Department: Project |
Budget Bill
Amount |
LAO Amount |
Comment |
|
|
|
|
| 1760--General Services: Blue
Anchor Building--fire/life safety
and ADA corrections |
$1,122 |
$74 |
Addresses code
violations cited by State Fire Marshal. |
| 1760--General Services:
Resources Building--fire/life safety
corrections |
2,063 |
102 |
Addresses code
violations cited by State Fire Marshal. |
| 4260--Health Services: Southern
California Laboratory--fire/life
safety renovation |
300 |
120 |
Addresses code
deficiencies. |
| 4300--Developmental Services:
Agnews--Building 54 fire/life safety
upgrades |
2,461 |
117 |
Addresses code
violations cited by State Fire Marshal. |
| 5240--Corrections: CCI--New
potable water source, Phase II |
1,728 |
224 |
Second of two new wells needed to replace
existing water supply system. |
| 5240--Corrections: CIM--TB/HIV
housing engineering controls |
140 |
60 |
Improves ventilation to reduce chance of
another tuberculosis outbreak. |
| 5240--Corrections:
CMF--TB/HIV housing engineering
controls |
140 |
60 |
Improves ventilation to reduce chance of
another tuberculosis outbreak. |
| 5460--Youth Authority:
Nelles--Renovate Taft Adjustment
Center |
140 |
55 |
40-year-old building used as lock-up unit
is severely deteriorated. |
| 5460--Youth Authority:
Stark--Fire alarm system for
education area |
195 |
75 |
Provides alarm system in education area. |
| 8960--Veterans Home:
Yountville--Remodel Holderman
Activity Area |
250 |
88 |
Corrects building deficiencies in hospital
therapy area. |
| 9860--Unallocated Capital Outlay |
1,000 |
500 |
With deferral of new projects, fewer
budget packages needed in 1999-00. |
| Totals |
$12,686 |
$4,622 |
|
|
|
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Approve Seven New Projects
We recommend approval of $3.1 million for seven new projects because the Department of General Services can accomplish the phases of these
projects as proposed in the budget.
Figure 4 (see page 22) lists seven new life safety or security projects for which we would recommend approval as budgeted. We believe that the DGS can
accomplish the phases of work as proposed in the budget because the projects are relatively small and not complex.
| Figure 4 |
| New DGS-Managed Projects Recommended for Approval |
| (In Thousands) |
| Item--Department: Project |
Phasesa |
Budget Bill
Amount |
Comment |
|
|
|
|
| 2660--Transportation: Redding
Office--seismic retrofit |
PW |
$79 |
Consistent with legislative policy to
fund seismic risk level VI retrofits. |
| 2740--Motor Vehicles:
Sacramento--first floor asbestos
abatement and seismic retrofit |
P |
440 |
Part of multiphase asbestos removal
project. |
| 5240--Corrections: CMC--Hospital
air conditioning |
PW |
65 |
Hospital currently lacks air
conditioning. |
| 5240--Corrections: CRC--Perimeter
fence |
P |
120 |
Corrects security problems. |
| 5460--Youth Authority:
Stark--Security lighting in ward
rooms |
PW |
100 |
Current lighting fixtures easily
tampered with and metal parts are
used as weapons. |
| 6110--Education: School for the
Deaf, Riverside--Fire/life safety
code corrections |
PWC |
218 |
Addresses deficiencies cited by
State Fire Marshal (minor capital
outlay project). |
| 8940--Military:
Bakersfield--Acquire new armory
site |
A |
2,125 |
Site already identified. Existing
buildings will need minimal
alteration in 2000-01. |
| Total |
|
$3,147 |
|
|
|
|
|
| a A=acquisition; C=construction; P=preliminary plans; and W=working drawings. |
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Refined Cost Estimates Pending
The Department of General Services is reviewing the cost estimates provided by the departments for many of the new projects proposed in the budget.
More refined cost estimates should be available by the spring for the Legislature's review.
The cost estimates for many of the new projects proposed in the budget were prepared by the individual departments. These estimates generally contain
insufficient detail to evaluate whether the proposed budget is appropriate. The DGS is reviewing the departments' estimates and preparing budget
packages that will be available by the spring. We will review these budget packages and provide any recommendations as appropriate.
Parks and Recreation Workload
We recommend the Legislature delete $290,000 from the General Fund for two new projects proposed by the Department of Parks and Recreation
because the department has a large backlog of design and construction work that should be completed before starting new projects. (Delete $130,000
from Item 3790-301-0001 [8] and $160,000 from Item 3790-301-0001 [10].)
The 1998-99 Budget Act granted the Department of Parks and Recreation (DPR) the authority to acquire, plan, design, construct, and administer
construction contracts in the same manner as the DGS. As discussed above for projects managed by the DGS, DPR has a large backlog of uncompleted
capital outlay work. For example, during budget years 1992-93 through 1995-96 the department had to obtain reappropriation of funds for 64 of the 84
approved major projects (76 percent) because the department did not complete its work on schedule. Furthermore, these projects had to be reappropriated
an average of twice before the work was completed and many of the department's projects have had to be reappropriated three, four, and five times.
In view of these chronic implementation problems, we recommend the Legislature not approve new major projects for the department until the backlog of
work is substantially reduced. Accordingly, we recommend the following projects in the Governor's budget be deleted:
Sonoma Coast State Beach: Trail Rehabilitation and Development--study and preliminary plans, $130,000.
Sugar Pine State Park: Rehabilitate Day Use Area--preliminary plans and working drawings, $160,000.
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Pay-As-You-Go for Capital Outlay
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The Governor's budget proposes $195 million in direct General Fund appropriations for a variety of capital outlay projects. In recognition that the
state should increase its use of pay-as-you-go funding, we recommend that the Legislature maintain direct General Fund spending at least at the level
proposed by the Governor. Furthermore, we recommend that any funds "freed up" by legislative action to adopt our General Fund reductions to
proposed projects be redirected to reduce the level of lease-payment bond authorizations in the budget.
In our December 1998 report, Overhauling the State's Infrastructure Planning and Financing Process (reprinted in The 1999-00 Budget: Perspectives
and Issues), we indicate that, outside the transportation area, the state has devoted a minuscule amount of pay-as-you-go funding for infrastructure.
Instead, the state has relied almost exclusively on bond authorizations to fund these needs. As discussed in the Overview of this chapter, the Governor's
budget continues this trend. For example, out of the proposed $1.1 billion capital outlay program, $844 million are from bonds, including proposed
authorizations of $262 million in new lease-payment bonds. The remaining $252 million are direct appropriations from the General Fund ($195 million)
and other funds ($57 million) for pay-as-you-go funding.
In our December report, we recommend that the state (1) adopt an infrastructure investment policy that would devote 6 percent of General Fund revenues
to infrastructure spending and (2) within this level dedicate a greater proportion for pay-as-you-go spending. Increasing direct General Fund spending will
both provide more stable funding for infrastructure and allow the state to get a "bigger-bang-for-the-buck" with state expenditures (by avoiding the interest
and other costs associated with bonds).
Given the state's current budget situation for 1999-00, we realize that significantly increasing General Fund spending on infrastructure will be difficult.
We believe, however, that pay-as-you-go spending should at least be maintained at the level proposed by the Governor. In our analyses of the capital
outlay projects proposed for pay-as-you-go funding, we have recommended General Fund reductions totaling $32.6 million. We recommend that the
Legislature apply this amount to projects that are proposed to be funded with lease-payment bonds, which in turn will reduce future debt costs.
Figure 1 lists, by department, the lease-payment bonds proposed in the budget. Depending on legislative actions on our recommended General Fund
reductions, the Legislature could redirect those funds to these departments' capital outlay programs for 1999-00. We recommend that the first priority for
such redirection of General Fund support be $7 million to prepare the preliminary plans for the Department of Mental Health's sexually violent predator
facility. As discussed in our analysis of the department's capital outlay program (later in this chapter), it makes little sense to incur the interest costs
associated with lease-payment bond financing to perform design work on this project.
| Figure 1 |
| Departments with Proposed
1999-00 Lease-Payment Bonds |
| (In Thousands) |
| Item |
Department |
Amount |
|
|
|
| 0690 |
Emergency Services |
$6,720 |
| 0820 |
Justice |
50,199 |
| 1760 |
General Services |
21,098 |
| 2720 |
Highway Patrol |
11,214 |
| 3540 |
Forestry |
7,192 |
| 4440 |
Mental Health |
22,687 |
| 5240 |
Corrections |
124,270 |
| 5460 |
Youth Authority |
11,733 |
| 8570 |
Food and Agriculture |
6,519 |
|
Total |
$261,632 |
|
|
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Capital Outlay in Higher Education
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The Governor's budget includes $572 million from general obligation bonds for capital outlay in California's three segments of public higher
education--University of California, California State University and California Community Colleges. The proposed amounts for each segment and our
recommendation for each are summarized in Figure 1.
| Figure 1 |
| Higher Education Capital Outlay
1999-00 Budget Amount and Analyst Recommendations |
| (In Thousands) |
| Segment |
Budget Amount |
LAO Recommended
Approval |
|
|
|
| University of California |
$209,819 |
$159,794 |
| California State University |
209,481 |
125,853 |
| California Community Colleges |
153,127 |
140,614 |
| Totals |
$572,427 |
$426,261a |
|
|
|
| a Includes a total of $137.3 million for which we have withheld recommendation pending receipt of additional information. |
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As shown in the figure, we recommend the Legislature approve $426 million of the requested amount. In general, we have recommended approval of
projects that address critical safety issues (such as seismic safety), renovate space to meet academic or other campus programs, provide research space,
and correct infrastructure problems. On the other hand, we have recommended that the Legislature reduce the request by a total of $146 million by
deleting or reducing projects if the segment has not substantiated either the need for or the cost of the project. Also, in several instances, the request is for
new space that is not justified because the campus has sufficient space to accommodate current and projected enrollment. In other cases, the segment has
proposed a project without providing sufficient detail to justify the need for the project or other alternatives that would be more cost effective. An
additional issue we have raised this year is the year-round operation of campuses throughout higher education.
Year-Round Operation Saves Capital Outlay Costs
Our analysis indicates that operating higher education campuses on a year-round basis will result in a capital outlay savings of $19 million related to
projects proposed in the budget and potentially several billion dollars over the next decade and beyond.
In our companion document The
1999-00 Budget: Perspectives and Issues
(Part V), we recommend that the segments begin implementing year-round operation.
Currently, no campus offers the full schedule of courses that is available in
the normal three quarters (or two semesters). As a result, during the summer
months, enrollment is limited and existing instructional space is vacant. Our
analysis indicates that the projected enrollment growth in public higher education
in California could be accommodated in existing instructional space well past
the next decade if the campuses operated year round.
Consistent with our findings on year-round operation, we have recommended that the Legislature delete $9.5 million (future cost to complete of
$10 million) from the proposed budget for projects that would not be needed under year-round operation. Over the next decade and beyond, year-round
operation should result in several billions of dollars in savings related to the reduced need for new instructional space.
Legislature Should Consider Additional Projects
We recommend that the Legislature consider funding additional priority projects for higher education using any bond funds "freed up" by legislative
action accepting our recommendations to reduce project costs in the Governor's budget.
As shown in Figure 1, we have recommended that the Legislature reduce the proposed budget for higher education capital outlay by $146 million. The
three segments, however, have estimated that over the next five years a total of over $6 billion will be needed for capital improvements. Many of these
projects are to renovate instructional space to accommodate changes in academic programs, address life safety issues such as seismic safety of buildings,
correct infrastructure problems, and other facility deficiencies.
In view of these identified needs, we urge the segments to submit new proposals that address these other priority needs for legislative consideration for
funding in the 1999-00 Budget Bill. This would also allow the Legislature to assess the need for projects that are a priority for the segments but currently
are not included in the Governor's budget. The Legislature could then consider funding these other projects with any amounts "freed up" by accepting our
recommendations.
Discontinue Past Practice of Equal Bond Amounts for Each Segment
We recommend that the Legislature discontinue the past practice of providing an equal amount of bond funds to each segment because this practice
does not address the highest-priority needs throughout higher education.
Appropriations Should Be Based on Project Merits Rather Than Equal Amounts to Each Segment. In recent years, the administration has had an
agreement with the segments to provide an equal amount of total available bond funds to each segment (these amounts, however, may vary in any one
year). This agreement results in "grants" to each segment without regard to the condition of the physical facilities on an individual campus or the merits or
priority of individual projects . This can result in lower-priority projects in one segment receiving funds while a higher-priority project in another segment
may go unfunded. As a result, the state's current practice of equal bond fund allocations neither addresses the highest-priority needs throughout higher
education nor provides the Legislature the information it needs to assure that its actions in appropriating funds are meeting statewide needs.
Furthermore, we believe it is essential to target funding to the highest statewide priorities because there is a limited amount of bond funds dedicated to
higher education. Proposition 1A, approved by the voters in November 1998, provides $2.5 billion in general obligation bonds for higher education. Of
this amount, $1.25 billion cannot be issued or sold before July 1, 2000 and $165 million is dedicated to new campuses, campuses with enrollments less
than 5,000 full-time equivalent students, and off-campus centers. As mentioned above, the three segments have developed five-year capital outlay plans
that total over $6 billion. If, as we recommend, year-round operation is implemented, the five-year capital outlay need will be significantly reduced.
However, the capital needs to correct seismic safety issues, renovate buildings to meet changes in academic programs, and provide other new space such
as faculty/administrative offices and research space, will greatly exceed the available bond funds. Thus, in order to assure that the bonds approved by the
voters are spent on the highest statewide priorities, we recommend that the Legislature appropriate funds for higher education on the merits of the projects
in the context of statewide priorities rather than equal "grants" of funds to each segment.
Return to 1999-00 Budget Analysis Capital Outlay Table of Contents
Return to 1999-00 Budget Analysis Table of Contents
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A balanced program of building activity which adequately addresses the entire range of needs
of Californians--including education, housing, and general government.
Approaches to project management and administration that will expedite project delivery.
A majority vote for local school bond issues, and the vote requirement for other local
government bond measures.
Adjustments in the state-local match on building projects.
Assumption of responsibilities of certain projects either totally by the state or totally by local
governments.
Identification of resources needed for debt payments.
Reforms in the manner and method of construction which do not jeopardize the health and
welfare of the citizens of the state.
Linking eligibility for infrastructure funds to meeting performance criteria.
Utilization of the State Infrastructure Bank to assist in financing state and local infrastructure.
Dedication by both state and local governments of a set amount of funds for pay-as-you-go
financing.
Determination of a prudent level of bond debt service for the State of California.
A rational prioritization of needs.