ANGELIDES OFFERS SURPLUS LAND PLAN.

Byline: Steve Geissinger and Harrison Sheppard Sacramento Bureau

SACRAMENTO - State Treasurer Phil Angelides proposed Tuesday that the state create a massive education endowment to manage state-owned property which would generate revenue to send more students to college.

The plan puts the likely Democratic gubernatorial candidate on a collision course with competing surplus-property plans from Gov. Arnold Schwarzenegger, lawmakers and a Nov. 2 ballot measure.

Angelides' plan would tackle criticism of the state's lax property management by creating the nation's seventh-largest education endowment, overseen by a public board.

If approved by lawmakers and the governor, the $5 billion endowment would buy, lease, build and sell urban state-owned properties, with expected profits used to increase higher education enrollment.

``This endowment can produce $2 billion in new revenues over the next 10 years to help expand the opportunities of our young people to go to college at the very time when California needs to have more, not fewer, younger people getting college degrees,'' Angelides said at a Capitol news conference.

After a few transitional years, he said, the endowment could ultimately generate up to $300 million a year.

Representatives from Schwarzenegger's office said they had not reviewed Angelides' plan and would not comment. But the Republican governor, who might face Angelides if Schwarzenegger runs for re-election in 2006, has his own ideas for consideration by the Legislature next year.

The California Performance Review, Schwarzenegger's commission to study streamlining of state government, examined the issue of surplus property and recommended an array of changes.

The governor in May issued an executive order asking the CPR staff to examine the state's highest-value real estate assets that could be sold as surplus or used to generate revenue in some other way. That report is expected to be issued in a few days, said CPR spokesman Russ Heimerich.

``There's an effort on the part of CPR to look at state real estate and other state property and have the state get a grasp on what it does own and the best ways to use that,'' Heimerich said. ``The idea is to get the highest and best use out of it.''

Angelides' proposal might not only clash with the governor's plans. If approved by voters, a Nov. 2 ballot measure, Proposition 60A, would steer revenue from surplus state-land sales to help pay off a $15 billion deficit-recovery bond issue approved by voters in March.

Lawmakers pitched legislation addressing the issue during their 2004 session, but the bills, which drew bipartisan support, wound up the victims of political squabbles.

An author of one of the unsuccessful bills, Sen. Jeff Denham, R-Modesto, on Tuesday welcomed Angelides to ``the broad coalition of legislators and the governor in working for state asset reform.''

Steve Geissinger, [phone]

sgeissinger(at)angnewspapers.com