Bond Oversight

Study Schedule

DATE & TIME
EVENT
WRITTEN MATERIAL

Monday, February 13, 2017
2:00 p.m., 925 L Street, Conference Room 175, Sacramento CA 95814

Public Meeting
Thursday, September 22, 2016
9:30 a.m., State Capitol,
Room 437
Public Hearing

Description of Study

The Little Hoover Commission is re-visiting its 2009 review of bond oversight in California.  With a $9 billion statewide school bond measure on the November ballot and $5.5 billion in local bond measures enacted by voters in June 2016 alone, this review will provide an opportunity for the Commission to update its assessment of the state’s mechanisms to ensure bond money is spent efficiently and effectively and as voters intended.

In its 2009 report, Bond Oversight: Expanding and Enhancing Oversight, the Commission recommended expanding legislative oversight and independent audits and streamlining and improving Web-based reporting on bond expenditures.  The Commission also recommended reconstituting the California Water Commission and giving it a role in managing natural resource bonds.  Additionally, the Commission recommended bolstering local bond oversight committees.

The Commission also recommended improving transparency and clarity for voters, including a simple and easy-to-understand chart in the voter guide identifying how much a statewide bond measure will cost and the revenue source the state will use to repay the bond.  This recommendation was implemented through legislation in 2011 and has resulted in a state bond cost estimates box at the top of any bond measure on a statewide ballot.

This 2016 update will provide an opportunity to assess the progress, or lack thereof, in implementing the Commission’s 2009 recommendations and uncover any additional opportunities to improve oversight of bond expenditures.

In 2015, State Treasurer John Chiang convened a Task Force on Bond Accountability and legislation to implement the recommendations from this group, SB 1029 (Hertzberg), which is currently under consideration by the Legislature.  If enacted, this legislation will improve transparency and accountability.  As part of its review, the Commission will assess whether this legislation, if enacted, will lead to the type of transparency the Commission envisioned or if additional measures are necessary. 

Additionally, the Commission will look at whether reconstituting the California Water Commission has led to improved oversight of natural resource bond spending, as intended by the 2009 recommendation.

Finally, in 2009, the Commission made specific recommendations for improving oversight of local bond measures, particularly by bolstering local bond oversight commissions.  These recommendations included mandatory training for bond oversight committee members and changes in the member-appointing authorities. They also included better defining in statute the role and responsibilities of the local committees and the purpose and objectives of annual financial and performance audits of school construction bonds enacted under the reduced voter threshold established in 2000 through Proposition 39.

In its 2009 report, the Commission saw great potential in the thousands of eyes and ears on the ground serving on local bond oversight committees.  As part of this review, the Commission will assess whether the recommendations it made in 2009 are still valid or if other or additional measures are necessary to ensure local bond accountability.   The Commission also will assess opportunities to overcome the logjam that has prevented progress in improving local bond oversight.

If you would like more information regarding this review, please contact Executive Director Carole D’Elia at carole.d’elia@lhc.ca.gov or at 916-445-2125.  To be notified electronically of meetings, events, or when the review is complete, please send a request to littlehoover@lhc.ca.gov.

Click here for a list of additional previous studies on general government.