California spends nearly $200 billion a year on budget and even more off-budget in the form of programs paid with bonds, i.e. One of the most vexing questions for the framers of the Constitution was how to create a vigorous and independent executive without making him king. Too often road and bridge projects … And while Jerry Brown in his second stint as Governor appears to have given up on the “small is beautiful” mentality, there still isn’t a pervasive and collective belief in strong infrastructure investment by any major figure in the state’s capital. Another approach is making revenue-generation more efficient by more closely attaching usage of the infrastructure with payment for it. Outside of politics, I am a business attorney based in the San Francisco Bay area. Successful in reining in the out-of-control and punitive tax increases plaguing the state, Proposition 13 and its legacy ballot measures – those inspired by Prop 13 and aiming to further its original mission – ravaged local government revenue. . Regardless of what happens in 2016, California has a daunting pile of infrastructure investment needs building up that will only continue to grow unless serious and decisive action happens soon. In the 1950s and 60s, California spent 20 cents of every dollar on capital projects. While the gas tax once was a decent proxy for road usage, advances in fuel efficiency in traditional vehicles and the advent of hybrid and electric vehicles has severed that relationship. But then the 1978 tax revolution occurred in the form of Proposition 13. The infrastructure situation at the local level is bleak. The California we know today – with a population of nearly 40 million people and agricultural land covering millions of acres – would not be possible without major investments in infrastructure to transmit water and power throughout the state, and to provide flood protection. At that time, water supply was seen largely as an engineering problem: catching winter rains and spring snow runoff by damming rivers; moving water from its source to where it was needed for farms and homes via canals and pipelines; and drilling wells to augment surface diversions. Broken outlet valves. Finally, California could work to make projects less expensive by better promoting and allowing the use of public-private partnerships for infrastructure construction and maintenance, enhancing the competitive bidding process, and reducing the prevalence of project-labor agreements, which benefit more expensive unionized labor. It is numbers like these that have convinced the city and state governments to launch the sort of large new infrastructure projects that will enable to city to meet its future commitments. Matched with a majestic and trade friendly coastline, along with visionary business leaders, California’s future seemed secured. Lowering the thresholds would, again, open that possibility of over indebtedness and taxation. When you consider the California legal system and its regulatory system, inclusive of the world’s most comprehensive global warming law, California is likely the most regulated state in the Country, if not the World. Given the high cost of living in California, that means many Californians are subject to that rate. Instead, they support higher taxes. These include: Demographers project that California’s population will … By the 1980s, that figure dropped to less than five cents on the dollar. funding programs and taken local revenues. But it’s not like those things are unexpected. In fact, there is no indication that the next generation has any concern for the future debt. How much in debt are the California governments? Even worse, policy fixes by the ballot box are inflexible – since voter passed measures can only be amended by subsequent votes by the public (unless the initial ballot measure gives amendment authority to the Legislature, which is a rarity). The Rebuild SoCal Partnership (RSCP) represents 2,750 contractors throughout Southern California that represent more than 90,000 union workers. Adopting distributed renewable energy generation and storage would have a number of potential benefits, in terms of both mitigating hazards and reducing exposures. As explored in the January 2016 issue of Eureka, California’s current funding regime for road maintenance and modernization is no longer adequate. It’s hard to know but all of those figures are more than daunting. Columbia River Crossing. That service tax would be on top of the existing income tax. VOTERS TEND TO APPROVE K-12, WATER, AND TRANSPORTATION INFRASTRUCTURE BONDS, Source: 2016 California Five-Year Infrastructure Plan, COST COMPARISON IN SWITCHING FROM GAS EXCISE TAX TO ROAD USAGE CHARGE, Source: U.S. Department of Energy, Federal Highway Administration, California Energy Commission, & American Petroleum Institute That’s hard to know too. After Prop 13, other ballot measures put further restrictions on a host of other taxes, fees, and bonds. The state’s schools have an estimated capital expenditure gap of $3.2 billion.”. California however shows both a high tax capacity and high fiscal need. SF Topic: Homeless - in a wealthy country people are sleeping in doorways. California has the 10th highest sales tax. Yes, California has seasonal problems with … The political music chairs started whereby local elected officials and state legislators alike were constantly looking to their next office rather than paying attention to the needs of their current one. Those reports detail the existing and expected impacts of global warming in California. I am the former Chairman of the CA Republican Party and I am a former candidate for the U.S. Senate seat in California. According to the Center for Cities and Schools at UC-Berkeley, California’s K-12 schools will require, over the next decade, approximately $117 billion in total capital investments to ensure the state’s school facilities remain adequate learning environments. America's infrastructure is a mess, and experts say it could take upward of $4.5 trillion to fix it. Join the Hoover Institution’s Current California law permits P3 for both state and local projects; however, P3 authorization sunsets in 2017. The drought has compounded problems relating to water, for example. You would think all of the above would have government officials deeply worried. The modern California was built on an expansive and well-thought-out infrastructure plan. It also includes green infrastructure like vegetated areas that provide habitat, flood protection, cleaner air and cleaner water. And as estimated by the U.S. Environmental Protection Agency, California’s aging water systems need approximately $45 billion over the next two decades to ensure safe water conditions. The next generation of leaders, Gavin Newsom, Kevin de Leon, Xavier Becerra and Kamala Harris are significantly to the Left of the old (and “conservative” by comparison) Jerry Brown and Diane Feinstein. All of which brings us to the number one reason California is not sustainable. Yes, California has seasonal problems with fires, mudslides, earthquakes and the like. They are responsible for close to half of all water main leaks, and replacing them is a looming, $1-billion problem for the city. Where are they going? A contractual agreement between a public agency (such as the State of California or the City of Palo Alto) and a private sector company, P3 combines the competitive advantages of both entities to deliver a service or implement a project for general use all while ensuring both sides share the risks and rewards. Infrastructure is paid for both by the federal government and by state and local governments.It’s important to note that not all states and counties have the same funds for infrastructure. © 2020 by the Board of Trustees of Leland Stanford Junior University. In obtaining possible infrastructure solutions to the above-mentioned problems, a correlation is required among governments throughout the state, as well as excellent governance by its leaders. On the other hand, for more than a decade, less than 150,000 of California’s 35+ million people pay half of all of its income tax – a highly imbalanced system. The American Society of Civil Engineers just rated our bridges, transit system and our roads. While other cities such as Palo Alto to the south have experimented with city owned fiber optic networks, San Francisco has limped … Thus solutions moving forward must focus on easing the restrictiveness of funding – at both the state and local level. Today, however, that system is crumbling beneath our feet and the bill just to repair it – let alone modernize it for the next generation of Californians – is steadily growing: some estimate it to be around $500 billion or roughly 3 times the proposed 2016-2017 total state expenditure budget. 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