California Proposition 145, First-Time Homebuyer Bond Act (1990)
If Proposition 145 had been approved, it would have authorized the issuance of $200 million in general obligation bonds to support a loan program for first-time homebuyers.
Proposition 145's official ballot summary said:
This act establishes a comprehensive housing program to address the severe housing crisis in California by (a) authorizing the use of funds from the First-Time Home Buyers Bond Act of 1982, under which the voters of this state authorized a bond issue of two hundred million dollars ($200,000,000), to provide financial assistance to first-time homebuyers in the form of interest rate subsidies and deferred-payment, low-interest second-mortgage loans and (b) providing for a bond issue of one hundred twenty-five million dollars ($125,000,000) to provide funds for a housing and earthquake safety program that includes financing for:
(1) the preservation and rehabilitation of the existing stock of rental housing for families and individuals, including rental housing which meets the special needs of the elderly and disabled,
(2) emergency shelters and transitional housing for homeless families and individuals,
(3) a multifamily mortgage loan and bond insurance program,
(4) farmworker housing, and
(5) rehabilitation loans to enable unreinforced masonry rental buildings to withstand earthquakes.
The fiscal estimate provided by the California Legislative Analyst's Office said:
Direct Cost of Paying Off the Bonds.
The state would receive loan repayments under the three loan programs discussed above. These repayments, however, would be used for additional loans, not for repayment of the general obligation bonds. As a result, the state's General Fund would be responsible for the bond principal and interest payments, which typically would be paid off over a period of about 20 years.
Generally, the interest on bonds issued by the state is exempt from both federal and state income taxes. However, interest on the bonds sold to fund the programs covered by this measure may not be eligible for the federal income tax exemption (but would be eligible for the state exemption). As a result, the average interest rate on these bonds would be higher than on other state bonds. If the authorized bonds are sold at an average interest rate of about 9.5 percent, the cost would be about $630 million to pay off both the principal ($315 million) and interest ($315 million). The average payment would be about $26 million each year.
- Hastings California I&R database
- Los Angeles Law Library, 1990 ballot propositions (dead link)
- November 1990 election results (pages 9-10)