The California Chamber of Commerce today announced that its Board of Directors has voted to oppose the “No Blank Checks” initiative.
“This measure is dangerous for our economy and the safety of our citizens,” said Allan Zaremberg, President of CalChamber. “The ‘No Blank Checks’ initiative would stop or delay vital public works construction projects in California, including those involving water security and highway improvements. The gap between our current capacity and our infrastructure needs is large and growing. This measure would make it much harder to close that gap.”
The proposed measure would require a statewide election each and every time the state or a state-local partnership seeks to issue revenue bonds exceeding $2 billion to pay for infrastructure projects. General obligation bonds appropriately require a vote of the people, because the risk of default is on the taxpayers. But the risk for default of revenue bonds is on the bondholders, which makes a statewide vote entirely unsuitable, the Chamber argues.
According to the CalChamber Board, the “No Blank Checks” initiative would harm major infrastructure projects by adding an unnecessary level of cost, bureaucracy and delay to a process already bogged down with delays and bureaucracy. If passed, the measure will take a widely-used and fiscally-responsible financing mechanism off the table.
In addition, the measure would encourage litigation and increase the ability of special interests to leverage major infrastructure projects for their own purposes.
While this measure has been linked to water infrastructure, it could also impact transportation, local school construction, UC and CSU projects and impede the ability for emergency repairs to be made in the wake of a natural disaster.