A huge new set of government borrowing data from the California Treasurer’s Office for the first time details how government entities – from the state on down to counties, cities and special districts – planned to repay $1.5 trillion in bonds sold since the mid-1980s.

Some of the borrowing has been financed with special taxes, or from the growth in property tax revenue in now-defunct redevelopment areas.

But about 40 percent of the debt listed the general fund as the repayment source. Committing that money, which also pays for most governmental services, meant it hasn’t been available for costs such as hiring more police officers (in cities and counties) or giving cost-of-living increases to the blind, elderly and disabled (at the state level.)

Treasurer John Chiang, unveiling of the interactive DebtWatch site, said some borrowing is “absolutely critical.” But Chiang noted there are trade-offs. “It’s not free money. It has to be paid back, and we want to make sure we’re handling this debt properly,” he said.

Of the $337 billion in state government debt sold over the past 30 years, all but about $10 billion had the state general fund as the repayment source, filings show. That represents almost three times the entire state general fund for the current fiscal year.

At the local level, the general fund was the repayment source for about 45 percent of the $336.4 billion in non-redevelopment debt for cities and counties. In the Sacramento region, cities’ general funds were the repayment source for about a third of the debt.

“If you’re fortunate enough to have money set aside … that’s a more efficient way to do things. But not everybody can afford to do that,” said Michael Coleman, a municipal finance expert.
Local government debt since the mid-1980s has helped pay for bridges, public buildings and other projects. Yet the two largest reasons for borrowing were to meet cash-flow needs and to cover insurance and pension costs – with no new community centers or schools to show for the expense.

The website doesn’t show how much of the debt has been paid off or remains outstanding – that’s information local governments do not have to report to the state. Chiang’s office said it may sponsor legislation next year to require the data.

http://www.sacbee.com/news/politics-government/capitol-alert/article45701496.html