Proposition 57 (officially, the Economic Recovery Bond Act) was a
California ballot proposition
In California, a ballot proposition is a referendum or an initiative measure that is submitted to the electorate for a direct decision or direct vote (or plebiscite). If passed, it can alter one or more of the articles of the Constitution of Cal ...
on the March 2, 2004 primary election ballot.
It was passed with 4,056,313 (63.4%) votes in favor and 2,348,910 (36.6%) against.
The proposition authorized the state to sell $15 billion in long-term
bonds to pay off accumulated deficits. Proposition 57 went into effect only because
Proposition 58 (the California Balanced Budget Act) also passed.
Propositions 57 and 58 were the centerpiece of
Governor
A governor is an administrative leader and head of a polity or political region, ranking under the head of state and in some cases, such as governors-general, as the head of state's official representative. Depending on the type of political ...
Arnold Schwarzenegger's plan to resolve California's budget problems. Schwarzenegger campaigned heavily for the passage of Propositions 57 and 58.
California State Senator
The California State Senate is the upper house of the California State Legislature, the lower house being the California State Assembly. The State Senate convenes, along with the State Assembly, at the California State Capitol in Sacramento.
...
Tom McClintock
Thomas Miller McClintock II (; born July 10, 1956) is an American politician serving as the U.S. representative for since 2009. His district stretches from the Sacramento suburbs to the outer suburbs of Fresno; it includes Yosemite National ...
, Schwarzenegger's fellow
Republican
Republican can refer to:
Political ideology
* An advocate of a republic, a type of government that is not a monarchy or dictatorship, and is usually associated with the rule of law.
** Republicanism, the ideology in support of republics or agains ...
and rival in the
2003 gubernatorial recall, was one of the chief opponents of Proposition 57.
The last payment of these deficit bonds was made Wednesday, August 5, 2015.
Included in the payments made over the life of the bonds were payments into a state escrow account, where interest payments totaling $4.1 billion were put aside to be paid out through July 1, 2019.
When the bonds were paid off, Schwarzenegger said, "I’m glad this chapter of California’s fiscal history is finally closed."
Official summary
* A one time Economic Recovery Bond of up to fifteen billion dollars ($15,000,000,000) to pay off the state's accumulated General Fund deficit as of June 30, 2004.
* The Economic Recovery Bond will be issued only if the California Balanced Budget Act is also approved by the voters.
* The bonds will be secured by existing tax revenues and by other revenues that can be deposited in a special fund.
Summary of Legislative Analyst's Estimate of Net State and Local Government Fiscal Impact:
* One-time increase, compared to a previously authorized bond, of up to $4 billion to reduce the state's budget shortfall.
* Annual debt-service savings over the next few years.
* Above effects offset in subsequent years by higher annual debt-service costs due to this bond's larger size and the longer time period for its repayment.
Notes
External links
Voter Information Guide with text of Proposition 57
57
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