Perata Calls For Bond For State Infrastructure

OAKLAND - A week after California voters rejected eight special-election initiatives, Senate President Pro Tem Don Perata said Tuesday he hopes the electorate will look more kindly on a multibillion-dollar bond to upgrade the state's roads, ports and levees.

The Oakland Democrat touted the infrastructure package as the Senate's top priority in 2006. He characterized it as a way to salvage a legislative session "wasted" due to special-election politics.

Gov. Arnold Schwarzenegger asserted last week that he also wants to propose a major infrastructure bond next year, though he did not provide specifics. Lawmakers believe his plan will be even larger than the Senate's and possibly extend to schools and courts.

Perata said he has bipartisan support in the Senate and that he expects to work with Republicans to get a bond measure on the June ballot, which would require the Legislature and governor to agree by April.

But his Republican counterpart, Dick Ackerman of Irvine, fears the current plan could involve too much debt.

Ackerman said he agrees the state needs infrastructure improvements, but he believes the state needs to steer clear of proposing a bond so large that it could trigger tax increases.

Perata initially introduced his bond as a $7.6 billion package earlier this year, partly as a way to pay for the eastern span of the Bay Bridge. Lawmakers and the governor eventually agreed on a separate Bay Bridge plan, but Perata rewrote Senate Bill 1024 as a broader $10.2 billion proposal in September.

The latest version includes:

• $2.5 billion to improve the state's ports and trade corridors.

• $1.2 billion for flood protection.

• $2.3 billion for transportation projects that were delayed when the state used gas-tax money for other purposes.

• $1 billion for high-speed rail.

"The governor's proposal, on the other hand, is really a theo.ry at this point, no disrespect to him," Perata said Tuesday while standing in front of towering cranes at the Port of Oakland. "He would like to have a big bond ... but I don't think it was tied to anything specific."

Schwarzenegger met Friday with his Cabinet to discuss the infrastructure bond before leaving on his six-day trade mission to China, said Department of Finance spokesman H.D. Palmer.

Schwarzenegger's plan likely will offer a mix of funding strategies, including private-public partnerships in which the state would give incentives for construction firms to build in California, Palmer said.

When asked whether Schwarzenegger's bond would be bigger than Perata's, Palmer said, "This is a governor who thinks big, and the critical needs will determine how big the bond is."

Meanwhile, Ackerman opposes the high-speed rail component in SB 1024. And Ackerman said flood protection should be paid for through a revenue bond - one in which landowners in flood zones pay a fee to help upgrade levees.

"How much more bond indebtedness can we take on?" Ackerman said. "You can't put everything on a general obligation bond. We're already near our max."

Perata said the state could "easily absorb five times to 10 times the amount of money the Senate bond presently carries." But he warned that a bond of that size - $25 billion to $50 billion - would begin to encroach on California's other needs.

Democratic state Treasurer Phil Angelides, a 2006 gubernatorial candidate, said Schwarz.enegger and lawmakers need to balance the state's budget before advancing a bond plan. He said any bond program "needs to be fiscally prudent."

In the Assembly, Speaker Fabian Núñez, D-Los Angeles, plans to unveil his own bond plan in December. It likely will include some fee or tax component to help pay for specific projects, and may include additional money for schools, said Núñez spokesman Steve Maviglio.

If lawmakers and Schwarzenegger come to an agreement, voters likely will pass whatever infrastructure bond is proposed, said Tony Quinn, co-editor of the California Target Book, which analyzes elections.

"Historically they'll vote for bonds in good times and only vote against them in bad times," Quinn said. "If you get true bipartisan support and you dedicate the money toward something people understand, they will vote for it."

At a glance

The current version of Senate Bill 1024, a $10.2 billion bond proposal, includes:

• $2.5 billion to improve the state's ports and trade corridors.

• $1.2 billion for flood protection.

• $2.3 billion for transportation projects that were delayed when the state used gas-tax money for other purposes.

• $1 billion for high-speed rail.