Prop 12: Veterans' Bond Act of 2008

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(Sacramento, CA)
Tuesday, October 14, 2008

Prop 12 will ask voters to approve the sale of some 900-million dollars in state bonds.  It’s to fund home loans for veterans who have served in times of war.  Debra Lehr is the Deputy Secretary with the Cal Vet Home Loan program.  She says over the years voters have approved more than eight billion dollars in bond sales to finance it. 

“A 900 million veterans general obligation bond act will make it possible to make approximately 36-hundred loans to eligible California war-time veterans…” 

Such bonds are backed by the state.  The Legislative Analyst says if veterans’ payments don’t cover what’s owed on those bonds the taxpayers would have to pay the difference.  However Lehr says that’s never been a problem. 

 “The veterans are repaying these loans through their payments. We’ve never had to go to the general fund to support our program.” 

The measure was placed on the ballot by the state legislature with overwhelming support.  Indeed, there isn’t much opposition out there. However, Gary Wesley has written the ballot argument opposing Prop 12.  He’s concerned state taxpayers would be liable for shortfalls because it’s a time of declining housing prices.  He also says eligibility for the program should be limited even more—beyond just serving in time of war.  He says instead it should be only available to veterans who have served in combat or a combat zone.