Volume I, No. 11

January 29, 2009

California school finance is in for a wild ride over the next 18 months; Education’s Bottom Line provides information regarding the State Budget along with other pertinent information on issues affecting school districts.  

Public Employee Pension Contracts Initiative

By David Walrath -- dwalrath@m-w-h.com

The Attorney General and Secretary of State have cleared a new initiative for circulation.  The initiative relates to labor relations and specifically to renegotiation of public employee pension contracts.  The initiative has until July 22, 2009 for the proponent to submit the required number of petition signatures.  After the proponent files the petition signatures, there is a counting process and then a process to determine whether or not they are valid signatures.  That process could continue until October 19, 2009.  more...

Attorney General Issues Opinion on Use of Proceeds from Refunding Obligation Bonds

By Patti Herrera -- pherrera@m-w-h.com

State Attorney General Jerry Brown issued an opinion on January 9, 2009 stating that proceeds from refunding general obligation bonds (G.O. bonds) must be used to retire the debt on the outstanding bonds issued in accordance with what the voters approved.  The opinion takes issue with the legality of the practice by school districts and community colleges of refinancing voter-approved bonds at a lower interest rate and utilizing generated proceeds to complete unfinished projects approved by the voters or to finance other infrastructure projects.  The practice is commonly known as “cash out refinancing.”  The Attorney General has opined that refunding G.O. bonds that generate additional proceeds, beyond what is necessary to retire voter-approved debt, violates the Constitution by creating new bonded indebtedness without voter approval. more...

If you have any questions on the articles in this newsletter, please contact the author of the article in question.

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Murdoch, Walrath & Holmes (MWH) has been instrumental in shaping statewide policy and implementing regulations for K-12 schools for more than two decades.  Strategic relationships have been forged with the State Administration through agencies such as the Department of Education, the State Allocation Board, the Department of Finance and the Office of Public School Construction and, on the federal level, with key Congressional Members and the Executive Branch.  MWH prides itself on having some of the best minds in K-12 education in virtually all aspects of school fiscal needs. 

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