California Voters Lead in Passing Record Bonds on Ballot

By Darrell Preston and Adam Cataldo

Nov. 8 (Bloomberg) -- U.S. voters backed record borrowing of more than $50 billion for state and local governments as California approved $43 billion of bonds for transportation, water and school construction.

The five California proposals, the most bonds ever put before voters in a statewide election, all won by margins ranging from 56 percent to 77 percent, with more than four- fifths of the vote counted, according to the Associated Press.

``Passage of the Rebuild California plan marks a real milestone for our state,'' said California Senate President Don Perata, an Oakland Democrat, in a prepared statement. The plan will ``make a real difference to the lives of millions of Californians.''

The bonds were among a record $78 billion put before voters yesterday by 498 U.S. state and local borrowers. Los Angeles, Texas and North Carolina's Wake County led municipalities that won approval on another $7.55 billion of bonds, bringing total support to more than $50.55 billion, or 91 percent, of the $55.65 billion of measures of $200 million or more put before voters.

Already, the amount of debt approved by voters eclipses the prior record of $41 billion granted in 2002. Passage rates in the past 20 years have ranged from 40.6 percent of bonds on the ballot in 1990 to 92.4 percent in 1988, and averaged 75 percent, according to New York-based i-Deal LLC, a financial-services software company.

Dallas Parks

Dallas voters agreed to $1.35 billion of bonds for flood control, streets and parks in the ninth-largest U.S. city and Wake County, North Carolina, voters approved $970 million for schools.

Among ballot measures under $200 million, Dysart Unified School District in Arizona won approval for $190 million of bonds. Voters in Charlotte, North Carolina, approved all three bond referendums on the ballot totaling $120 million for projects including housing and neighborhood improvement.

U.S. states, cities and municipal authorities have borrowed in the municipal bond market for more than a century, seeking the lower interest rates available by selling tax-exempt debt. Last year, local governments borrowed a record $408 billion with 13,930 long-term bond issues, according to Thomson Financial.

Yields on 20-year general obligation municipal bonds with the highest debt ratings have declined to 4.21 percent from 4.39 percent at the start of the year, according to data complied by Bloomberg. That represents annual interest savings of $18,000 on every $100 million borrowed.

Following is list of the 20 largest bond issues on Nov. 7 ballots:

1. California $42.64 billion Pass
2. Dallas $1.35 billion Pass
3. Los Angeles $1 billion Pass
4. Wake County, North Carolina $970 million Pass
5. San Diego Community College $870 million
6. Metropolitan District Commission,
Connecticut $800 million
7. Folsom Cordova USD, California $750 million
8. Palomar Community College District,
California $694 million
9. Sweetwater Union HSD, California $644 million
10. Houston, Texas $625 million Pass
11. Tri-City Health Care, California $596 million
12. Austin, Texas $567.3 million Pass
13. Broward County, Florida $450 million Fail
14. Oswego CUSD #308, Illinois $450 million Pass
15. San Francisco Schools $450 million Pass
16. Charleston County, South Carolina $345 million Pass
17. Prince William County, Virginia $342.6 million Pass
18. Victor Valley Comm Coll Dist, CA $338 million
19. Irving, Texas $335 million Pass
20. San Mateo Union HSD, CA $298 million
21. Boulder Valley SD #RE2 Colorado $296.8 million Pass
22. Katy ISD, Texas $269.4 million Pass
23. Round Rock ISD, Texas $267 million
24. Arkansas Higher Education $250 million Pass
25. North Harris County MUD, Texas $249.6 million Fail
26. Alpine Board of Education, Utah $230 million Pass
27. North Clackamas SD # 12, Oregon $229.6 million Pass
28. Douglas County Schools, Colorado $200 million Pass