News item: “California to Sell 24 Government Buildings for $2.3 Billion” (AP, October 12, 2010).
As a way of helping plug the State of California’s now-chronic budget deficit, this headline is welcome news. Among the state-owned properties on the auction block are LA’s Ronald Reagan State Building and San Francisco’s Civic Center. I have on several occasions during the past decade recommended such a “yard sale”, a period during which Sacramento has almost continuously overspent its tax revenue.
The “deal”, according to some of its supporters, will enable the legislature to retire about $1 billion in bonds still owed on the 24 properties, leaving another $1.2 billion to stanch the flow of red ink in the state’s general fund.
Critics allege, on the other hand, that the lease-back arrangement with private purchasers exposes the state’s taxpayers to somewhere between $1.5 billion and $5.2 billion over the next 20 or 30 years for renting space they previously “owned”. . .