14 | Title and Summar y / Analysis
PROPOSITION AUTHORIZES BONDS FOR PUBLIC SCHOOL AND COMMUNITY COLLEGE FACILITIES. LEGISLATIVE STATUTE.
2 OFFICIAL TITLE AND SUMMARY PREPARED BY THE ATTORNEY GENERAL
BACKGROUND
California Has Many Public Schools
and Community Colleges. Currently,
there are about 10,000 public
schools statewide (including about
1,300 charter schools). These schools
serve elementary through high school
students. Local school districts govern
most of these public schools. California
also has 115 local community colleges
that offer associate degrees and other
programs for adults. Local community
college districts govern these colleges.
School and community college districts
usually build new facilities when they
are growing in enrollment and need
additional space. They renovate existing
facilities when those facilities are old or
unsafe.
ANALYSIS BY THE LEGISLATIVE ANALYST
The text of this measure can be found on page 70 and the Secretary of State’s website at voterguide.sos.ca.gov.
• Authorizes $10 billion in state general
obligation bonds for repair, upgrade,
and construction of facilities at K–12
public schools (including charter
schools) and community colleges.
•
Provides funding for new facilities,
to improve school health and safety
conditions at existing facilities, and
for classroom upgrades (e.g., science,
engineering, transitional kindergarten,
and vocational classrooms).
•
Expands eligibility for financial
hardship grants for small and
disadvantaged school districts.
•
Provides higher percentage of
state matching funds to schools
demonstrating greatest need.
•
Requires public hearings and
performance audits.
•
Appropriates money from General
F
und to repay bonds.
SUMMARY OF LEGISLATIVE ANALYST’S ESTIMATE
OF NET STATE AND LOCAL GOVERNMENT FISCAL
IMPACT:
• Increased state costs of about
$500 million annually for 35 years to
repa
y the bond.
State Bond Cost Estimate
Amount borrowed $10 billion
A
verage repayment cost
$500 million
per year over
35 years
S
ource of repayment
General tax
revenue
2 FINAL VOTES CAST BY THE LEGISLATURE ON AB 247 (PROPOSITION 2) (CHAPTER 81, STATUTES OF 2024)
Senate: Ayes 34 Noes 3
Assembly: Ayes 72 Noes 1
Attachment 3
For the full text of Proposition 2, see page 70. Analysis | 15
ANALYSIS BY THE LEGISLATIVE ANALYST CONTINUED
State and Districts Usually Split
Education Facility Costs. For public
school districts, the state usually
pays 50 percent of the cost of new
construction projects and 60 percent of
the cost of renovation projects. School
districts are expected to pay remaining
project costs using local funds. The
state also often shares the cost of new
construction and renovation projects
with community college districts. Though
the share of costs varies among projects,
the state commonly pays about half
of the cost, with community college
districts paying the rest using local
funds.
State Mainly Uses Bonds to Pay Its
Share of Costs. Bonds are a way that the
state borrows money and then repays
the money plus interest over time. For
more information about bonds, see
“Overview of State Bond Debt” later in
this guide. Over the past 20 years, the
bulk of state facility funding for schools
and community colleges has
come from voter-approved
bonds (a total of $31.8 billion).
Recently, the state provided
an additional $4.6 billion in
other funding for school and
community college facilities.
Almost all of this funding has
already been awarded for
specific projects.
Districts Usually Pay Their
Share of Costs Using Local
Bonds. School and community
college districts tend to pay
their share of project costs using local
bonds. Districts must get at least
55 percent of their voters to approve the
sale of local bonds. State law limits the
total amount of local bonds that school
and community college districts may
issue. These limits are based on the
total assessed property value within the
district. School districts that are unable
to raise at least $5 million under these
limits may apply for additional state
funding. Over the past 20 years, voters
approved $181 billion in local bonds for
public school and community college
facility projects.
PROPOSAL
New Bond for Public School and
Community College Facilities.
Proposition 2 allows the state to sell
a $10 billion bond for public school
and community college facilities. As
Figure 1 shows, the $8.5 billion for
public schools (or 85 percent of the total
AUTHORIZES BONDS FOR PUBLIC SCHOOL AND COMMUNITY
COLLEGE FACILITIES. LEGISLATIVE STATUTE.
PROPOSITION
2 2
16 | Analysis
ANALYSIS BY THE LEGISLATIVE ANALYST CONTINUED
bond amount) is split among four types
of facility projects. For new construction
and renovation projects, school districts
would apply for and be awarded funding
mainly on a first-come, first-served
basis. The state would award the
career technical education and charter
school funds through a competitive
application process. A small portion
of new construction and renovation
funds must be set aside for small school
districts. Unlike for public schools, the
$1.5 billion for community colleges (or
15 percent of the total bond amount)
is not split in a prescribed way among
specific types of projects. Community
college bond funds may be used for any
mix of new buildings, renovations, land
purchases, and equipment. Community
colleges would prepare a plan listing
their statewide project priorities. The
Governor and the Legislature would
select specific projects to fund.
Proposition 2 requires districts to
complete certain tasks to help ensure
bond funds are spent as intended.
Some Renovation Funding Available
for Certain Types of School Projects.
Proposition 2 allows up to $115 million in
renovation funds to be used for reducing
lead levels in water at public school
sites. Proposition 2 also allows school
districts to receive extra renovation
funding to build a new classroom or
renovate an existing classroom that would
be used for transitional kindergarten.
(Beginning with the 2025–26 school
year, all four-year olds will be eligible for
a year of transitional kindergarten before
entering kindergarten.) In certain cases,
school districts also could receive extra
renovation funding to expand or build
a new gymnasium, multipurpose room,
library, or school kitchen.
Increases State Share of Costs for Certain
School Districts. For some school districts,
Proposition 2 increases the state’s share
of new construction project costs from
50 percent to as much as 55 percent.
Proposition 2 also increases the state’s
share of renovation project costs from
60 percent to as much as 65 percent
for these school districts. In general, the
state would pay a higher share of project
costs for school districts that have lower
assessed property values and have a
higher share of their students who are low
income, English learners, or foster youth.
Allows More School Districts to Apply for
Additional State Funding. Proposition 2
allows school districts that are unable to
raise at least $15 million from local bonds
(up from $5 million) to apply for additional
state funding. This amount would increase
by inflation in future years.
FISCAL EFFECTS
Increased State Costs of About
$500 Million Each Year for 35 Years
to Repay the Bond. The estimated
cost to repay the bond would be about
$500 million each year (annually) over
a 35-year period. Payments would be
made from the state General Fund. (The
General Fund is the account the state uses
to pay for most public services, including
PROPOSITION AUTHORIZES BONDS FOR PUBLIC SCHOOL AND COMMUNITY COLLEGE FACILITIES. LEGISLATIVE STATUTE.
22 For the full text of Proposition 2, see page 70. Analysis | 17
AUTHORIZES BONDS FOR PUBLIC SCHOOL AND COMMUNITY
COLLEGE FACILITIES. LEGISLATIVE STATUTE.
PROPOSITION
2 ANALYSIS BY THE LEGISLATIVE ANALYST CONTINUED
education, health care, and prisons.) This
would be less than one-half of 1 percent
of the state’s total General Fund budget.
Since the state has to pay interest on the
money it borrows, the total cost of the
bond would be about 10 percent more
(after adjusting for inflation) than if the
state paid up front with money it already
has.
Unclear Effect on Local Costs Statewide.
The availability of state bond funds could
affect some districts’ local costs. For
example, some districts could respond
by seeking new local bonds to help them
meet project matching requirements.
These districts would see an increase
in their local costs. In contrast, other
districts could respond by borrowing less
because the state funds could pay costs
districts otherwise would have covered.
These districts would see a decrease in
their local costs. Overall, the effect on
local costs statewide is unclear.
Visit sos.ca.gov/campaign-lobbying/cal-access-
resources/measure-contributions/2024-
ballot-measure-contribution-totals for a list
of committees primarily formed to support or
oppose this measure.
Visit fppc.ca.gov/transparency/
top-contributors.html
to access the committee’s top 10 contributors.
2 2
18 | Arguments Arguments printed on this page are the opinions of the authors and have not been checked for accuracy by any official agency. ★ ARGUMENT IN FAVOR OF PROPOSITION 2 ★
★ REBUTTAL TO ARGUMENT IN FAVOR OF PROPOSITION 2 ★
PROPOSITION 2 WILL INCREASE DEBT AND RESULT IN
HIGHER PROPERTY TAXES
California already owes big banks and billionaire investors more than $78 billion. Prop. 2 adds another $10 billion—$18 billion when repaid with interest—for school and community college districts. This is on top of the approximately 40% of the total state budget guaranteed to go to public education from Proposition 98.
Under the funding formula used in Prop. 2, school districts must provide a “local match” of funds to receive money from the bonds. That will lead to districts issuing new local school bonds, which are paid for by adding new charges to property tax bills.
PROP. 2 IGNORES DECLINING ENROLLMENT IN SCHOOLS
AND COMMUNITY COLLEGES
It’s reckless to borrow billions more to pay for more school buildings when district enrollment is declining. According to the state Department of Finance, “California experienced the 6th consecutive decrease in total Public K–12
Enrollment in the 2022–23 school year,” and over the next ten years, if current trends hold, a further decline of 661,500 by 2032–33.
Prop. 2 borrows $1.5 billion for California Community
College facilities, but enrollment in the state’s community colleges has declined since 2019. The Public Policy Institute of California projects that community college enrollment “will not recover to pre-pandemic levels. ”
While the promises made by proponents cannot be
guaranteed, Prop. 2 does guarantee higher taxes for over- burdened Californians.
VOTE NO ON PROP. 2.
Assemblyman Bill Essayli
Jon Coupal, President
Howard Jarvis Taxpayers Association
VOTE YES ON PROP. 2 TO HELP MORE CALIFORNIA
STUDENTS LEARN IN SAFE, CLEAN, UPGRADED
SCHOOLS!
Many public schools and community colleges throughout
California are outdated and need repairs and upgrades to meet basic health and safety standards, prepare students for college and 21st Century careers, and retain and attract quality teachers. Prop. 2 will meet those needs and is guided by strict taxpayer accountability protections so funds are spent as promised with local control.
REPAIRING AND UPGRADING CALIFORNIA’S PUBLIC
SCHOOLS
Many schools in California are old, deteriorating, unsafe and cannot support the basic needs of our children.
Prop. 2 provides funding for urgent repairs to leaky roofs; deteriorating gas, electrical, and sewer lines; plumbing and restrooms; providing clean drinking water; removing hazardous mold, asbestos, and lead paint from our schools; and protecting students from extreme heat.
MAKING SCHOOLS SAFER
Too many of our local schools lack adequate safety and
security protections. Prop. 2 will make students safer by funding door locks, emergency communications and security systems, fire alarms, smoke detectors, and more.
PREPARING STUDENTS FOR 21st CENTURY CAREERS
Prop. 2 will upgrade local schools and community colleges including science, engineering, career technical, and
vocational education classrooms; labs; and learning
technology. It will help more students get job training, technical knowledge, and specialized skills to compete for good-paying jobs in the competitive economy.
INCREASING ACCESS TO AN AFFORDABLE COLLEGE
EDUCATION
Prop. 2 will increase access to quality, affordable higher education for all Californians—allowing more students
to start their college education, earn college credits, and transfer to a four-year university without crushing debt.
HELPING RETURNING VETERANS
Prop. 2 helps local community colleges upgrade facilities to expand veteran services, job training, and support for the tens of thousands of California’s returning veterans who rely on their local community college for job training and to complete their education and enter the civilian workforce.
RESTORING SCHOOLS AFFECTED BY WILDFIRES,
EARTHQUAKES, AND OTHER NATURAL DISASTERS
Prop. 2 provides immediate assistance to schools that are damaged or destroyed by wildfires, floods, earthquakes, and other natural disasters so they can quickly get up
and running.
PROTECTING LOCAL CONTROL OVER EVERY PROJECT
Prop. 2 protects local control by requiring that its funding only be used for projects approved by local school and
community college districts, with local community input.
All of the money will be controlled and spent locally, where taxpayers have a voice in deciding how these funds are
best used to improve their neighborhood schools, without increasing local property taxes.
FISCALLY RESPONSIBLE WITH TOUGH TAXPAYER
ACCOUNTABILITY
Prop. 2 requires public disclosure of every dollar,
tough independent financial audits, and strict limits on administrative and bureaucratic costs. These protections ensure that funding is spent directly on schools and used efficiently and as promised.
Our schools are in desperate need of upgrades and repairs to ensure our students are safe and ready to learn. Prop. 2 will help our students succeed.
PLEASE JOIN US IN VOTING YES ON PROP. 2.
David Goldberg, President
California Teachers Association
Sheri Coburn, Executive Director
California School Nurses Organization
Larry Galizio, Chief Executive Officer
Community College League of California
PROPOSITION AUTHORIZES BONDS FOR PUBLIC SCHOOL AND COMMUNITY COLLEGE FACILITIES. LEGISLATIVE STATUTE.
2 2
Arguments printed on this page are the opinions of the authors and have not been checked for accuracy by any official agency. Arguments | 19 ★ ARGUMENT AGAINST PROPOSITION 2 ★
★ REBUTTAL TO ARGUMENT AGAINST PROPOSITION 2 ★
Prop. 2 ensures that California students have the opportunity to learn in safe, updated schools while protecting taxpayers.
PROP. 2 IS NOT A TAX INCREASE
Prop. 2 will fund local upgrades and repairs to schools and community colleges without raising state or local taxes, despite what critics say. Some of the voices against Prop. 2 are ignorant about state bond financing and are making
untrue claims because they simply want the state to cut funding for public education.
WE CAN’T WAIT ANY LONGER
Too many California students attend schools with leaky roofs, unsafe drinking water, mold, asbestos, lead paint, and lead pipes. There is a massive backlog of local school repairs but no state funding available for them. Prop. 2 provides the funding so our schools get the upgrades they desperately need, ensuring students have safe, healthy schools to
support learning.
TOUGH ACCOUNTABILITY AND TAXPAYER PROTECTIONS
Prop. 2 puts local voters in control of how school bond monies are spent. It requires public disclosure of all state and local spending, annual audits, and tough accounting standards. Additionally, it protects taxpayers from higher local property taxes by providing state matching funds to local communities so they do not need to raise even more money to fund the full cost of school repairs and upgrades.
Prop. 2 is a bipartisan measure that will help more students get a quality education, increase access to an affordable college education, and improve job training opportunities for veterans and students.
Vote YES on Prop. 2.
Susan Dixon, State President
California Retired Teachers Association
Diana Limon, Director
International Brotherhood of Electrical Workers Local
Union 11
Sheri Coburn, Executive Director
California School Nurses Organization
NO ON PROPOSITION 2: Tell politicians to prioritize
education funding over free healthcare for illegal immigrants in our state budget, rather than further burdening taxpayers to pay off Sacramento’s ballooning bond debt.
Proposition 2 is yet another attempt to circumvent
California’s financial problems by asking taxpayers to
approve a $10 billion bond for education financing that should have been included in this year’s $288 billion
budget package.
A budget is a reflection of priorities, and our State
Legislature chose to prioritize over $5 billion for universal illegal immigrant healthcare rather than providing funds to support and repair our school infrastructure. Billions in new bond debt is not the answer.
Prop. 2 Saddles Future Generations with Debt that Our Kids Will Be Paying Off for Decades
The Howard Jarvis Taxpayers Association points out that bonds are borrowed money that must be paid back, plus
interest, even if that means cutting vital programs to do it.
Governor Newsom recently declared a budget emergency
because California spends more than it takes in. Children in school today will be drowning in new debt for decades if Prop. 2 passes.
Politicians want to borrow $10 billion from Wall Street and make Californians pay it back with interest, forcing taxpayers to pay up to $10 billion for debt service payments.
California Is Out of Money, Californians Are Over-taxed, Prop. 2 Will Make Things Worse
California, with rampant inflation and the highest gas and graduated income taxes in the nation, already has over
$109 billion of outstanding and unissued bonds alongside almost $200 billion of unfunded pension liabilities and retiree medical benefits—over a quarter trillion dollars.
Californians will have to shoulder a greater increase
in their tax burden paying off our bonds and related
interest payments. Our bond debt alone is already $2,460 per person.
Sacramento politicians overspend, issue bonds, and punish us with tax hikes on our cars, gasoline, and income. And those tax dollars rarely go where politicians say they will— our roads crumble while billions go to High-Speed Rail.
Prop. 2 Is the Latest in a Long List of Broken Promises In 2012, California voters approved Proposition 30’s
“temporary” increases to income and sales taxes. Then,
Proposition 55 in 2016 extended many of those “temporary” taxes to 2028. Both times, teachers’ unions promised
billions in funding for our schools.
Money pits in the vast education bureaucracy will suck up most Prop. 2 funds without one cent going toward direct instruction in school classrooms. Instead, this money will be spent on wasteful construction projects benefiting
special interests.
California’s schools are consistently ranked near the lowest in the country. Rather than throwing nearly $20 billion into school construction projects, our state needs a well thought out, long-term solution to achieve a high standard of excellence in reading, writing, and math. Prop. 2 does nothing to improve classroom instruction or help our children succeed.
Voters rejected Proposition 13, a $15 billion school bond, in 2020 for exactly these reasons.
VOTE NO ON PROP. 2.
Assemblyman Bill Essayli
AUTHORIZES BONDS FOR PUBLIC SCHOOL AND COMMUNITY
COLLEGE FACILITIES. LEGISLATIVE STATUTE.
PROPOSITION
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