California's Long Term Public Investment Goals Require Better Information, Hard-Headed Analysis, and a Partnership Approach.

SACRAMENTO--(BUSINESS WIRE)--Oct. 6, 1999--

California must significantly improve its long term public investment planning process so that infrastructure projects which will enhance the State's economy and quality of life can be selected and infrastructure funding gridlock avoided, according to a report released today by Californians and the Land, a collaboration of major California foundations concerned about sustainable land use issues.

The report, Smart Public Investments for the California Economy: Information and Analysis for Infrastructure Planning, was written by Stephen Levy, Director of the Center for Continuing Study of the California Economy. It calls for two major infrastructure planning improvements: (1) a partnership approach to infrastructure investments that recognizes the role of the State in collaboration with other users and investors; and, (2) a rigorous evaluation of public investments, based on cost-effectiveness and return-on-investment criteria, to determine whether proposed projects represent the best way to address California's infrastructure capacity needs.

According to the report, California faces a double infrastructure investment challenge: the State must make up for decades of under-investment as well as plan for future growth. California residents are contemplating public investments of nearly 200 billion dollars over the next ten years to begin fixing its highways, parks, water systems, and other public facilities.

"We need to re-invest in California's infrastructure, yet everyone agrees that the information being used to make public infrastructure investment decisions is inadequate," Levy said. "No family or private business would willing make serious long-term investment decisions with the paucity of information currently available to decision-makers and voters regarding California's infrastructure."

"California needs to make a significant investment in our infrastructure for the State's economy, environment, and quality of life. This need for infrastructure investment is well understood by California businesses," said Mr. Lew Coleman, Chairman of Bank America Securities and a member of the Governor's Commission on Building for the 21st Century. "However, what Californians need now is a good investment planning process and significantly better information and analysis of our investment choices."

"The 4 billion dollars in bond measures on the 2000 ballot to protect parks, improve water quality and conservation, and expand libraries and other public services offer Californians an excellent opportunity to meet some of the state's most urgent public investment needs," said Martha Davis, Director of Californians and the Land. "But so much more needs to be done. This report addresses the information and analysis needed for that long-term public investment planning process."

"California's infrastructure investments are a partnership effort", Levy advised. "The best role for state government must reflect what other infrastructure partners - local and regional agencies, the federal government, and California's private and non-profit sectors - can bring to the table. How much infrastructure investment California needs and how to make most effective use of taxpayer dollars cannot be determined by state government acting alone", Levy continued. One good example is how cities and school districts are working together to identify where the same infrastructure investment can be used jointly."

Levy continued, "The goal of this report is not to take the politics out of infrastructure decision-making, but to infuse more information and analysis into these very large infrastructure investment decisions facing residents. Rigorous evaluation of these investment choices will help planners identify the most cost-effective solutions to increasing California's infrastructure capacity." The report notes that the Federal government does not yet have a capital spending plan and that other states are facing the same long-term planning challenges as California.

Increasing the state's infrastructure capacity doesn't always mean building new facilities according to the Center's report. Past energy and water conservation programs provide a dramatic example of the billions of taxpayers dollars that can be saved when better use is made of existing infrastructure.

Californians and the Land commissioned the report because its sponsors recognized the opportunity to weave a better land-use fabric for all of California through infrastructure investments - but also the consequences to the State's future economy if the wrong decisions are made. "We asked the Center for Continuing Study of the California Economy to provide an economist's perspective on what the State needs to do to improve its infrastructure planning process. We hope that this report will help people who are concerned about California's future to find common ground in planning for that future."

Californians and the Land (CAL) is sponsored by The James Irvine Foundation, The David and Lucile Packard Foundation, The William and Flora Hewlett Foundation, the Wendy P. McCaw Foundation, Bank of America, and Environment Now, a private foundation based in Los Angeles. Started in late 1994, the collaboration provides a forum for a wide variety of public and private organizations and individuals to meet and discuss critical issues affecting sustainable land use policies for California, and seeks complementary grant making strategies to advance these activities.

The Center for Continuing Study of the California Economy (CCSCE) is an independent, private economic-research organization specializing in the analysis and study of California. The Palo Alto-based CCSCE focuses on long-term economic and demographic trends in the State and its major economic regions. CCSCE works with private companies and public institutions that require an explanation and analysis of the growth process as well as detailed quantitative projections.

The report, Smart Public Investments for the California Economy: Information and Analysis for Infrastructure Planning, can be obtained from Californians and the Land at 916 L Street, PMB-C256, Sacramento, CA 95814 or by contacting: HYPERLINK http://www.ccsce.com.