Figuring out the bond freeze

December 28, 2008 § 10 Comments

I am still waiting for local media to cover the effects of the bond freeze, and have been contemplating summarizing the projects that I know of, that have been halted.  Tim Brick, of the Arroyo Seco Foundation, just made it a little easier for me:  ASF sent out a press release calling out the State and the impact they will be having on their projects.  Thank you Tim, for standing up and making yourself heard!

An excerpt from Tim’s announcement, of projects halted:

The Arroyo Seco Watershed Coordination Program — $35,000 – Two staff people have been told to stop work on the grant program, as requested by the California Department of Conservation. This program began in July and had quarterly billing, so there has only been one invoice (July-September), and the grant managers have not yet processed the invoice for payment. In other words, ASF has not been paid for five and a half months of work on the grant, amounting to about $35,000 in staffing costs and expenses.

The Central Arroyo Stream Restoration Program – $251,000 – All work on this program was completed in September and the final invoice for $251,371 was submitted. The grant manager and the administrator in Sacramento both praised the program accomplishments and approved the invoice for payment, but that invoice did not reach the State Controller’s Office by December 17th, so it will not be honored.

(Note – my understanding – which is third-hand – is that the State changed their tune and gave agencies til 12/23 to turn in final invoices.)

As mentioned in my earlier post, pretty much all bond-related projects that are funded and managed by the Regional Water Quality Control Board, Rivers & Mountains Conservancy, Mountains Recreation & Conservation Authority, State Coastal Conservancy and Wetlands Recovery Project have been halted – even existing contracts – in the arenas of stormwater treatment, wetlands acquisitions and restoration.  (to say nothing of housing, road projects, and stuff outside of Creekfreak’s purview).  This means a lot of people are suddenly without work.  

Locally, here’s a short list of projects impacted (expanding on the two mentioned by Tim above):

If your project has been impacted, feel free to add a comment.  I think it would be good for the Creekfreak-reading public to see the breadth of work in the region has been halted.

Meanwhile up in Sac, the Bee covered the halt, as it relates to Bay-Delta projects.  Most chilling (if you happen to live behind this levee) is the halting of a levee repair project.  

Funding crisis threatens park, levee, science projects – Sacramento Politics – California Politics | Sacramento Bee.

Now here’s where I have go off the edge into speculation.  I would be thrilled for a newspaper to cover the story – and set the record straight.  Does the problem go away when we pass a state budget?  Or is our state credit rating so down in the dumps that we need to take other action to be able to sell bonds again?  And what is this statement below by our State Treasurer, especially the part highlighted in red? 

“Normally, the money the PMIA lends to infrastructure projects gets replenished when the State sells bonds. Unfortunately, the credit crunch and State budget woes have combined to close the bond market to California. Lockyer has determined the State will not be able to sell bonds until the Legislature and Governor forge a budget solution. With the State unable to sell bonds, continued lending for infrastructure projects would substantially reduce the resources available to the PMIA to keep the State afloat.

The PMIB’s action will, through June 2009: stop new infrastructure loans; bar increases to existing loans; and generally prohibit agencies from spending any more funds under existing loans. Staff estimates the actions would make available to the PMIA $3.8 billion to pay for services supported by the general fund.

As a practical matter, the development shuts down infrastructure funding from the PMIA until a budget solution is enacted and the State can sell bonds again. ”  -Tom Lockyer, State Treasurer, statement published in California Progress Report, Failure to Resolve Budget Crisis Harms Economic Recovery Efforts – California Progress Report.

This sounds like a great opportunity to take that 6 month sabbatical I’ve been hankering for.  But seriously, this is totally confusing. someone (LA Times?) really needs to clarify this.  Please.  Because June 2009 is a very, very long work furlough.

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§ 10 Responses to Figuring out the bond freeze

  • Mike Antos says:

    The Southern California Wetlands Mapping Project (www.socalwetlands.com), out of CSUN under Dr. Shawna Dark, was told to stop working by SCCWRP. I am on vacation until Tuesday, so don’t know where the DWR Prop 50 projects at the Watershed Council stand.

  • Shelley Luce says:

    Thanks for highlighting the confusion around this Jessica – I also wish the media would pay attention and clarify the role that our legislators are playing in the fiasco. The media could also help to show the impacts this is having on people’s jobs and on important environmental work. I will add to your list some of the projects that we have underway, in partnership with various cities and nonprofits, that are now halted because of the bond money freeze: installing native tree wells to treat runoff in Venice; creating green streets in LA and Santa Monica; a badly-needed park refurbishment and stormwater treatment feature at Fairfax/Jefferson; stormwater BMPs/low impact development within the City of LA; historical ecology work in Ballona watershed; endangered species surveys for protection and restoration purposes; and numerous projects to remove invasive plants and restore native plants and habitat, especially along creeks and coastal bluffs.

    The work cessation affects the contractors, suppliers and managers of all these projects, as well as our ability to protect and clean up our urban environment. I hope that our legislators overcome their partisan differences and agree on a budget soon, and that this helps our bond rating enough to get people back to work. At least I think that’s what has to happen! Someone, please correct me if I’m wrong.

  • Jim Odling says:

    The bond freeze may save the Whittier Narrows Natural Area from destruction.

    The spending freeze may lead to slowing the politically connected from destroying the Whittier Narrows Natural Area. The misnamed oversized San Gabriel River Discovery Center, a $30 million government-water agency conference center, is affect by the freeze, so far. The development, if carried forward, would pave over (150 space parking lot) and build over ( a football field long building) on the last remaining fragment of coastal alluvial fan sage scrub on the San Gabriel River between Santa Fe Dam and the ocean.

    Please contact us for more info@naturalareafriends.net

  • This is downright freaky. Thanks for your coverage!

  • Nancy Steele says:

    Jessica, Thanks for covering this crisis. If we had a real newspaper anymore in Los Angeles they would be doing their job and reporting on the huge impact this is going to have on the state. Where are the articles talking about nonprofits going under because of the loss of bond funds? How about for-profit consulting firms that build so many of these infrastructure projects? The hit to the economy is potentially huge, yet the LA Times is silent.

    The Watershed Council has eight grants/ contracts that are affected by this freeze. These projects include the feasibility study for restoring the earthen bottom portion of the Compton Creek, a stream daylighting study in south Los Angeles, two Watershed Coordinator positions for Los Angeles River and Rio Hondo/San Gabriel River, the Sun Valley Neighborhood Retrofit (to start construction in 2009), the watershed valuation project, and Arundo removal in Whittier Narrows. We are also a subcontractor on two grants (one of which is one of the DoC watershed coordinator positions).

    Let me add another thing to your list of things that are confusing about this mess: We have not received any communications from DWR ordering us to stop work. So are those grants affected or not? Does the agency have to give us a stop work order or are we just supposed to know?

    I don’t want to think about what will happen if this freeze continues through June 2009 (but of course I will have to think about it – that’s my job). I need to know if they will reimburse us for work if we can continue paying staff until they sort this out. The state has said no, but it is hard for me to believe they will be able to keep to that. There are certain expenses that you can’t just shut off with no notice. I think the state has to be on the hook for at least some of those expenses. And I can keep staff working using other funds, but I and my board need to know what this will mean in the end to our bottom line.

    So far the state has given us no clear information and that is just wrong.

  • Jessica Hall says:

    Mark Gold at Spouting Off has also posted eloquently on this issue. His estimate is that the soonest this mess will go away will be early to mid Feb.

    http://spoutingoff.wordpress.com/2008/12/28/california-scrooge/#comment-223

  • Jessica Hall says:

    One more – from Scott Valor on my Facebook page:

    “HUGE issue, but maybe too wonky for the media? When hospitals aren’t funded and 911 calls aren’t answered, then maybe. Maybe. Unfortunately so many environmental and habitat projects that WON’T be funded have a critical human health & safety factor about them, but will still go unnoticed.

    Meanwhile, the media are having a blast reporting about themselves sitting around Waikiki in shorts and slippers waiting for something to happen in Kailua other than working out at a marine base and the kids not getting stung by man-o-wars…”

  • Anna B says:

    HUGE issue for many researchers throughout California funded by the CALFED program, etc.
    It’s not being covered yet because our idiot governor did his little weasel thing and sent letters out on Christmas Eve!
    UC doesn’t even resume work until today.
    I got my notice the middle of last week. This is just so idiotic. I can’t believe the disruption this is going to cost – and it is all politics (e.g. the Governor trying to force the legislature’s hand – when he started this whole thing with his “cutting taxes” policy.) Our state is so sad and stupid!

  • rum718 says:

    Why is the state allowed to take my tax money and spend it on something other than what I was told? Isn’t that the point of issuing bonds?
    Who decided this was a good idea?

    It directly affects millions of people, and there is no logical way out now.
    Even if the budget were approved today, the costs to start up all these projects again will outweigh any short-term benefit.

    Not to mention any impending legal action as a result of all this…

  • Joe Linton says:

    I was disappointed to hear that the MRCA projects have been hit hard by this… The Pacoima Wash project (http://lacreekfreak.wordpress.com/2008/10/14/innovative-stormwater-park-under-construction-on-the-pacoima-wash/) stopped in mid-construction.

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