By: Jenny O'Mara and Ben Adler
The state’s top finance officials make up what’s called the Pooled Money Investment Board. It voted to shut off nearly four billion dollars for projects. The move affects work all over the state-- including school construction, roads and levees. State Treasurer Bill Lockyer chairs the Board. He says the move is unprecedented—and the fall out is unclear.
“We don’t know how many are gonna result in a financial penalty, a lawsuit, inability to get the project going again, without additional expenses, we just don’t have that information.”
The board manages the account that provides money for public works projects. The money is also used to help meet the state’s cash flow needs. It’s replenished by bond sales—but finance officials say the bond market has largely been closed to California. That’s because of the current credit crunch— and the state’s ongoing budget woes. Representatives from the construction industry said the move will result in tens of thousands of layoffs.
Board's Action Could Have Major Impact on the Sacramento Region
Some of the biggest local projects are at stake: crucial downtown Sacramento redevelopments like the Railyards, Township 9 and the Docks. Levee work, including in the high flood risk area of Natomas. Major freeway projects like the Lincoln Bypass and Highway 80 widening project in Roseville. And tens of millions of dollars for local school districts.
“We’ve got about 14 projects at some point in the pipeline for having state funding coming in for school building, whether it’s modernization projects or whole new projects.”
Dr. Vicki Barber is El Dorado County’s superintendent of schools. She says the board’s action has a ripple effect throughout the community.
“It isn’t just our own schools and dealing with the public education needs of our community but it’s dealing with contracts that have perhaps been let with architects and contractors.”
Barber says her biggest concern is uncertainty – not knowing when the projects will get the state funds they’ve been promised … or even if they’ll get funded at all.