California voters will soon decide on Proposition 4, a multi-billion-dollar bond measure to fund climate and environmental initiatives across the state. Supporters argue the measure is crucial to advancing efforts for a more sustainable future, while opponents warn it could add significant debt without ensuring long-term benefits. The Prop. 4 vote comes amid heightened debates over how best to address climate impacts and budget constraints.
KPFA’s Scott Baba reports:
Prop. 4 would authorize the state to issue $10 billion in bonds to fund environmental and climate projects statewide. David Lewis is executive director of Save the Bay. The environmental group is a proponent of Prop 4 and say it would make good use of the bond money.
Democratic state Sen. Ben Allen of Los Angeles authored Prop. 4. The measure has the support of many Democratic lawmakers and was placed on the ballot with Gov. Gavin Newsom’s signature. It’s part of an effort to address an unforeseen gap in the state’s budget. In 2022, Governor Newsom and the Legislature approved a $54.3 billion spending package called the “California Climate Commitment” aimed at aggressively addressing the impacts of climate change on California. However, that package was cut to $44.6 billion this year as part of an effort to balance a ballooning budget deficit estimated at $68 billion. Democratic lawmakers argue that although cutting the programs covered by Proposition 4 was necessary for the budget, the programs are too important to let die. Proposition 4 has also been endorsed by the California Labor Federation, SEIU California, California Professional Firefighters, the California Municipal Utilities Association, Clean Water Action, the League of Women Voters of California, the Environmental Defense Fund, and the Natural Resources Defense Council, among others. Save the Bay’s Dave Lewis said many of the projects included in Proposition 4 are vital for state residents.
Opponents of the measure include the California Republican Party and the Howard Jarvis Taxpayers Association. They argue that the bond measure would burden the state with unnecessary debt for projects better funded through other means. In a statement, Republican state Senate Minority Leader Brian Jones of San Diego said – quote – “Prop 4 is a special interest and Democrat political wishlist disguised as so-called ‘climate action,’ saddling taxpayers with nearly $20 billion in Wall Street debt. Rather than funding lasting infrastructure, it funnels money into pet projects like pop-up tents for farmers’ markets and zoo exhibits—far from the meaningful solutions Californians need.” Susan Shelley is vice president of communications with the Howard Jarvis Taxpayers Association. It’s a group that advocates for lower taxes and fiscal responsibility in California. She said that while there’s nothing intrinsically wrong with most of the projects or programs in Proposition 4, bond measures that burden the state with billions of dollars in debt should be reserved for major, long-term projects that will continue to serve a purpose long after the debt has been paid. She said not all the programs in Prop 4 do that.
Chris Hoene is the executive director of the California Budget & Policy Center, a nonpartisan research and analysis nonprofit. He said that while bonds do create debt and additional interest costs for the state, they play an important role in state finances.
According to the nonpartisan California Legislative Analyst’s Office, the state is currently paying about $6 billion each year from the general fund to repay existing bonds, and it will continue to pay a similar amount over the next few years. That’s about 3% of the state’s annual general fund revenue, which is lower than the historical average of about 4%. Meanwhile, the Legislative Analyst’s Office found that repaying the money for Proposition 4 could cost up to $400 million a year over 40 years, which would add a little less than one-half of 1% to the state’s total annual general fund budget. With interest over that period, the total cost of the bond would be about 10% more than if the state paid upfront with money it already has. The analysis also found that the measure will likely reduce costs for local governments by helping to pay for necessary projects cities and counties were already planning to fund themselves, and it could result in significant cost reductions for state and local governments if any of the projects included in the proposition prevent or mitigate the effects of a major natural disaster.
Chris Hoene with the California Budget and Policy Center said that dismissing the projects included in the bond as too short-term in nature could be viewing the issue from too narrow a perspective.
Proposition 4 would require that 40% of the bond revenue be used to fund activities that benefit lower income communities or communities that are affected by environmental changes or disasters. The bond measure also includes some built in transparency. It requires the secretary of the Natural Resources Agency to publish a list of programs and projects paid for by the measure on the agency’s website. The measure would require the report to list the project’s location, objective, status, anticipated outcomes, total cost, amount of bond funding, and any matching funds. The costs to publish that report would be covered by the bond revenue.