The New California Gold Rush

by Richard Michael (bigbadbonds.com)

The purpose of this article isn't to re-hash what you may already know. It's a call to action - a very simple and easy-to-do action.

2016 was a banner year for the school bonds cartel in California. After 16 years of practice with Proposition 39 (2000), the cartel has nearly perfected the art of printing currency -- more than 95% of the proposed bonds passed.

Mining your property taxes for profit is the new California gold rush.

The cartel passed 226 local school bonds in 2016. All the pieces are now in place for the most massive increase in the waste of property taxes in the state's history.

After nearly two years of investigating, it's clear that the cartel (which includes elected and hired district officials) has no interest in actually fixing school facilities. After all, if the borrowed funds were actually put to the purposes permitted under Proposition 39, the cartel would relatively quickly be out of business.

No matter where you sit on the political spectrum, unless you're part of the establishment, you want value for your taxes. Whether you want your district to have shiny new upgrades to 19th Century, brick-and-mortar facilities or you want your district to operate within its means, you want what was promised.

What Was Promised? (Fraud in the Inducement)

About 80% of voters never bother to look past the question in the sample ballot booklet. As if by design, the full text is separated from the question by pages of distractions.

The question, which is the only thing that appears on your ballot, is designed from the results of a survey that you paid for. (A crime, according to Kamala Harris #AnchorTag("California Attorney General Opinion 13-304", stGlossary.AgOpHarris, "00", "title={Document was modified on September 7, 2016 and link changed.}")#.) Your district's bond counsel stuffs every survey-tested word into the 75-word-limit question. It's a marketing question. It's designed to make you feel guilty to vote against it. (The bond counsel's fees are nearly universally contingent on the passage of the measure, so it has a stake in the outcome of the election.)

The language of the measure, however, backs off every single one of the promises made in the question. That's intentional.

Contrary to the requirements of Proposition 39 and without legal authority, bond counsel writes a measure that, putatively, lets your district do anything it wishes with the funds.

It's the classic bait-and-switch scheme, unlawful in any context.

Strict Oversight Fraud

More often than not, oversight is promised in the ballot question itself. It's such a good selling point that nearly every other government agency that puts a tax on the ballot includes an oversight committee even though it's not required by statute.

The reality is far different. Your district has already planned how it will check off the oversight box. It's just one of its pro-forma actions on the list of statutes that it uses for public relations purposes. None of the statutes have any teeth. The cartel knows it, therefore your district knows it. It's all for show.

Your ballot measure, argument in favor, and all the campaign marketing materials promote strict, independent oversight.

After your measure passes, you lose focus. Your district relies on that. Out-of-sight, your district uses a secret process to fill the oversight committee with cheerleaders, guaranteeing that there will be no oversight.

But there are audits, aren't there? That joke's on you too. Unlike the annual financial audits that require California Department of Education oversight and review, the two annual bond audits are a private matter between your district and its auditor. (Like bond counsel, the auditor has a financial incentive -- highly paid work required by law.) No one with any skill or independent judgment reviews the bond audits.

What Can YOU Do?

For all your local November 2016 bond measures, your district (or a nearby district -- you don't have to live in the district) have just recently established or are about to establish an oversight committee.

If you want to waste your time, but feel busy, you can attend your district board and committee meetings. After you sit through an hour or two of the self-congratulatory, feel-good, dog-and-pony show, you might get your two or three minutes to say something. You may as well say it to your dog, for all the effect it will have.

There is an art to effectively using your time. It starts with a simple, straight-forward action. Just like a lawyer on television or in the movies, you start with a question.

I've heard all the excuses. Do you just like to commiserate and opine with your choir about the fraudulent use of your property taxes? Then this is not for you.

There are other simple, easy-to-do actions. To be effective, The Art of War advises that you don't show your hand. Members of the California School Bond Clearinghouse web site are granted access to those strategies and tactics.

The window of opportunity will close very quickly. To be effective, you must act when it's easiest to have an impact. That time is NOW!

What question should you ask? Call me. The cartel is watching.