More than a year after California school bonds first hit the headlines in a big way, state lawmakers have passed legislation tackling some of the industry’s most serious problems.
Assembly Bill 182, which passed the state Senate last week, will now go to Gov. Jerry Brown’s desk. He’s expected to sign it.
The bill outlaws some of the wackier trends that made the Poway Unified School District a poster child for irresponsible bond financing. School districts will no longer be allowed to borrow money at a price of $10 for $1, and school boards will be forbidden from borrowing money today and pushing off payments too far into the future.
But the bill is a far cry from the comprehensive reform some fiscal hawks wanted. The California League of Bond Oversight Committees, a group that keeps an eye on municipal bond financing, plans to send the governor a letter pointing out several weaknesses in the law.
We’ve taken a close look at the bill and broken down what it means for California school districts and taxpayers.
The impacts of the bill come in two clear categories: changes and caveats.