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Important Ballot Questions Await Voters

posted in: Weekly Commentary 0
By Lowell L. Kalapa

The joke around this time of year is vote early and vote often! But seriously, voters need to go to the polls next week and exercise their right to decide who will lead our state in the coming years.
Just as important are some proposed amendments to our state constitution. There will be three questions on the ballot about changes to our state’s fundamental document. While one seems to noncontroversial, two of the questions have generated a lot of debate.
The noncontroversial question would require candidates for legislative office to live in the district for which they intend to run prior to the filing of their nomination papers. It seems rather straightforward and reasonable that persons wanting to run for office to represent a specific area live in the district before they officially become a candidate for that office.
The second question would allow the legislature to authorize the issuance of “special purpose revenue bonds” to assist nonprofit, private schools. This would allow private schools to utilize this means of financing that is currently available to other private institutions or organizations which serve a public purpose. These include hospitals, public utilities, and even movie studios.
Because the bonds are issued by the state, the earnings are exempt from state and federal income taxes making the investment more attractive and commanding a lesser interest rate than would be available on a taxable bond or commercial loan. However, because the state is not responsible for the repayment of the bond nor is it obligated should the debt repayments not be made, there is no liability for the taxpayer or the state. Thus, while the interest rate will be lower than ordinary borrowing instruments or loans, the rate will probably be higher than the rate would be on a bond secured by the state or county government as the risk is slightly higher than for a government-backed bond.
Curiously, the issue is being opposed by public employee unions and in particular the teachers’ union. They argue that allowing the state to issue these bonds detracts from support for the public school facilities and taxpayer support for public schools. Unfortunately, that is an uninformed perception of special purpose revenue bonds. Since interest rates on special purpose bonds will almost always be higher than for bonds issued and backed by the state, debt issued for public schools will always carry a more favorable interest rate than special purpose revenue bonds largely because of the lower risk.
As noted above, there is no risk or obligation on the part of the state or taxpayers. The repayment of special purpose revenue bonds is entirely the responsibility of the entity for which the bonds were issue. In other words, the private school is on the hook for the repayment of the debt, not the taxpayer or the state. Given that making this type of debt instrument available to private schools is support of the public purpose of educating the youngsters of our community, it would appear to be an appropriate public purpose. Further, because these borrowed moneys represent new infusions of capital into the state, they will create jobs that might not otherwise have been created. So the pluses outweigh any minus, if indeed there are any. This amendment should get the voters’ stamp of approval.
Finally, the third question would allow felony prosecutions to be initiated with the use of “written” information known as a “criminal complaint.” This avenue of initiating a felony prosecution would be in addition to the existing process that uses a grand jury indictment and preliminary court hearings. Those who support the amendment argue that this would avoid the duplication of certain legal and grand jury procedures without compromising the defendant’s rights. Supporters also note that this process would reduce the complexity of scheduling witnesses to appear at a specified time before a grand jury or subjecting victims to the stress of appearing multiple times in the same court case.
On the other side, those who oppose the amendment argue that a defendant’s right of due process will be violated. Certainly, under our form of law all persons should be afforded their due process rights. However, it should be noted that the amendment to the constitution is not the definitive word on how the new process would work and how due process rights could be preserved. That is up to the actual legislation that will be drafted once this amendment is approved. Thus, it would seem reasonable to give lawmakers this alternative.

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