California Proposition 108, Passenger Rail Bond Act (1990)
Proposition 108 was for a bond issue of $1 billion for passenger rail.
The ballot summary said:
- "This act provides for a bond issue of one billion dollars ($1,000,000,000) to provide funds for acquisition of rights-of-way, capital expenditures, and acquisitions of rolling stock for intercity rail, commuter rail, and rail transit programs. Appropriates money from state General Fund to pay off bonds. Summary of Legislative Analyst's estimate of net state and local government fiscal impact: If all authorized bonds are sold at 7.5 percent and paid over the typical 20 year period, the General Fund will incur about $1.8 billion to pay off bond principal ($1 billion) and interest ($790 million). The estimated annual cost of bond principal and interest is $90 million."
The fiscal estimate provided by the California Legislative Analyst's Office said:
- The fiscal effect of this measure would depend on whether voters approve Proposition 111, The Traffic Congestion Relief and Spending Limitation Act of 1990.
- If Proposition 111 is approved by voters at this election, the passage of this measure would result in the following fiscal effect:
- Direct Costs of Paying Off the Bonds. For these types of bonds, the state typically makes principal and interest payments from the state's General Fund over a period of about 20 years. If all of the bonds authorized by this measure are sold at an interest rate of 7.5 percent, the cost would be about $1.8 billion to pay off both the principal ($1 billion) and interest ($790 million). The average payment for principal and interest would be about $90 million per year.
- If Proposition 111 is not approved, this measure would not take effect and, consequently, it would have no fiscal effect.
Path to the ballot
The California State Legislature voted to put Proposition 108 on the ballot in Assembly Bill 973 (Statutes of 1989, Ch. 108).