Prop. 39 lowered the vote needed for passage of a school bond from a super majority to 55%. Prior to Prop 39, School Bonds rarely passed and after they rarely fail.
I sat on the Bond Oversight Commission for Chula Vista Elementary and they are asking for more money this election cycle. I presently sit on the Sweetwater Union High School District Prop O BOC and there is a night and day difference in how they operate.
A BOC’s task is set forth in the California Constitution Article 13A and the Education Code Section 15264 and enumerated in Section 15278 and 15282 in particular. Section 15280 states the support that the District is to provide to the INDEPENDENT BOC.
In practice there is very little opportunity given to the BOC members to perform their mandate.
Upon leaving office, President Eisenhower warned us of the “Military Industrial Complex”. Such a dynamic has evolved in the design, construction, and funding of school facilities throughout the State. In many cases, there is not three degrees of separation between the parties. It is not at all uncommon to find a facilities manager for a District who has previously worked as a consultant, or contractor in school construction. Conversely retired school administrators find ready work promoting and advising the contractors and consultants they used to hire. There is a great opportunity for corruption in this system, especially when, as is the case with Sweetwater Union High School District there are neither campaign limits nor a restriction on corporate contributions. The very companies that have work or are seeking work with the District can donate to a board member without limit. A check of campaign contribution disclosure forms can be extremely enlightening. It is still possible for a member of the Sweetwater board to accept tens of thousands of dollars from contractors and consultants. And this is in spite of having two sitting members under indictment for pay to play practices along with the previous superintendent and a past board member. Given a chance to remedy this situation at the October board meeting, three of the Trustees refused to make that reform. To be fair, there are also trade unions contributing to a board president in Northern California who then has made contributions to the local Board members’ campaigns.
The typical BOC is not given a say in the issuance of bonds or the type of construction mechanism employed, i.e. Design Build, Lease/Leaseback, Construction Manager, or Competitively Bid Contract. The latter is the most transparent but seems to be the last choice lately.
A BOC typically will have no say before the fact in alternative funding such as that employed by Poway and San Diego Unified called Capital Appreciation Bonds (CABs) whose debt service will outlast the improvements they are meant to pay for. There is also the CAB’s little brother, a Bond Anticipation Note (BAN). This is a 5-year note that has the District betting that property valuation within that district rises enough so that a new Bond can be sold to pay off the note. If property valuations don’t rise, or a new bond can’t be sold for some other reason, repayment will come out of the District’s general fund. This would be no mean fete when in some districts payroll and pension obligations are 80% to 90% of their annual General Fund expenditures.
This begs the question, Is a Bond Oversight Committee, the quid pro quo for the lower threshold for passage of a School Bond an artifice, a sham to lull the voter into thinking that there are real people, people like themselves, looking out for their interests?
A quick review of the Operating Standards for the Sweetwater BOC, as set up by the Sweetwater Board, can only lead you to the conclusion that their BOC is acting as a Judas Goat.
One way to empower a BOC would be to insist that the School District adopt the Operating Standards that have been promulgated by the California League of Bond Oversight Committees. These Standards were set up with active participation by the San Diego County Taxpayers Association and go a long way in creating a BOC that has real oversight.
