Dec. 31, 2007

When a Bond Vote is Contested

More than 18 months ago, voters in the Foothill-De Anza Community College District’s service area in Northern California approved by nearly a 2 to 1 margin a $490.8 million bond measure enabling the institutions to raise money for a range of construction projects.

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Because of litigation filed by a pair of area lawyers seeking to overturn the election, only a fraction of the money raised thus far has been available for spending — with the rest held in escrow, according to Andy Dunn, vice chancellor of business services for the district.

But in recent weeks, the district won a legal victory for its two colleges and, perhaps, others in California, as a state appeals court in San Jose struck down the challenge, affirming a lower court ruling about the constitutionality of the vote and whether the district presented voters with sufficient information about the bond measure.

Defendants in the case claimed that the ballot initiative, Measure C, did not include accountability provisions required by Proposition 39 in California, which lowered the approval requirement from 66 to 55 percent for bonds issued by community college districts to pay for certain types of projects. The 55 percent standard applies only if general obligation bond proceeds are used for the purposes specified by colleges, and if annual independent performance and financial audits are conducted.

According to court documents, the defendants argued that because the accountability provisions weren’t followed, and because the measure had fallen short of a two-thirds vote otherwise needed, the measure had not been approved. They said the district didn’t provide enough specific information about how the measure’s construction bonds would be spent.

On the ballot, voters were told that the “College Repair/Job Training Measure” would:

• Improve job training/university transfer
• Upgrade electrical, heating, ventilation systems, fire/seismic safety
• Repair leaky roofs
• Improve disabled access
• Repair/expand classrooms for nurses/paramedics
• Upgrade technology
• Repair, construct, acquire, equip buildings, classrooms, libraries, sites and science/computer labs

The three-judge panel said that the full text of Measure C, set forth in the voter information pamphlet, included the language that appeared on the ballot and also a lengthy description of the projects for which the bond revenue would be used.

“Defendants urge a level of specificity that is impractical and unnecessary,” the court argued. “Surely it is unnecessary to inform the voter which buildings will receive new fire safety doors or which roofs will be replaced and which will be repaired. That is minutiae that the voter has no expertise or need to consider.”

Responding to the objection that the district didn’t provide adequate information about how the reviews would be conducted, the court said although Foothill-De Anza’s statement doesn’t say who will perform the audits, it’s not a requirement for the district to identify the auditor. The court continues that “while it’s also true that the statement does not say that the audits will be independent, “the omission is insubstantial. The word ‘audit’ connotes an independent inspection.”

The district also established a seven-person citizens’ oversight bond committee.

Melvin Emerich, one of the defendants, said only that he is disappointed in the court’s decision. “It shows that they don’t understand Prop 39.”

Aaron Katz, the other defendant, also called into question the constitutionality of the vote. Although he is the general partner of a limited partnership that owns real estate in the district, he doesn’t reside there, and thus couldn’t cast a ballot on the measure — which amounts, he argues, to taxation without representation.

The San Jose Mercury News has called Katz “an anti-tax crusader,” noting that his other challenges have delayed school and hospital projects in the region. Katz could not be reached for comment.

The appeals court rejected Katz’s claim on the basis that its own cases have “uniformly recognized that a government unit may legitimately restrict the right to participate in its political processes to those who reside within its borders.”

Foothill-De Anza has said the delay cost the district upwards of $300,000. Dunn, the business services vice chancellor, said construction can now begin in earnest.

“By this decision being published, we’ve essentially established precedent that other community colleges can rely on,” he said. “The lesson is that our project list was correct and consistent with the law.”

— Elia Powers

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