We are committed to carrying out the recommendation of the California Little Hoover Commission.

2017 Recommendations for Local Bond Oversight, Little Hoover Commission Report 236. In this update, the Commission found progress in improving bond oversight, but that progress has not been consistent for all statewide bond measures. The Commission sees an opportunity for improving bond oversight by establishing a consistent framework of accountability for all statewide bonds. It has been nearly eight years since the Commission noted the shortcomings in finding online information on bond expenditures and yet this challenge remains. The Commission looks forward to the implementation of SB 1029, which provides a much needed opportunity to gain greater clarity on state and local bond expenditures.

Recommendation 1: The Governor and the Legislature should adopt a consistent system to improve transparency and oversight of all statewide bonds, particularly the 2008 high-speed rail and the 2016 school facility construction bonds, which currently lack such requirements, as well as all future statewide bond measures. This oversight system should link bond expenditures to results that can be seen and measured by the public in an easy-to-understand online format.

Recommendation 2: The Governor and Legislature should ensure adequate resources are available for the California Debt Limit Allocation Committee’s implementation of SB 1029.

Recommendation 3: The California Debt and Investment Advisory Committee is encouraged to expedite the development of training materials for locally-elected officials on bond issuance. Specifically, in addition to webinars, online training and other written materials, this should include a one- or two-page guide for local officials including key questions that should be answered by staff and consultants on the terms of any bond authorization, including total cost of the bond, including interest and fees and the effect of a bond issuance on debt ratio.

Recommendation 4: Policymakers should enact legislation requiring a truth in bonding statement be provided for review by elected officials prior to authorizing a bond issuance.

Recommendation 5: Policymakers should enact legislation requiring the county treasurer to review and comment on bond issuance proposals prior to authorization. The county treasurer also should advise policymakers on maintaining a prudent debt ratio.