LEGISLATURE OKS $37 BILLION BOND PACKAGE.

Byline: Harrison Sheppard Sacramento Bureau

SACRAMENTO -- A record $37 billion bond package approved early Friday by state lawmakers would likely fuel a massive building program in Los Angeles aimed at reducing traffic, building schools and housing the homeless, state and local officials said.

The package will be appear as four separate bonds on the Nov. 7 ballot, setting up an unusual political dynamic: Gov. Arnold Schwarzenegger is expected to campaign for the package along with some of the same Democratic lawmakers who would like to see him unseated.

The package includes $19.9 billion for transportation, $2.8 billion for housing, $10.4 billion for education and $4 billion for flood protection.

The total is smaller than Schwarzenegger's original proposal of $68 billion, and his overall Strategic Growth Plan -- including money from the federal government and the state general fund -- has been reduced to $116 billion from the $222 billion he first envisioned.

While specifics haven't been determined, Los Angeles County -- California's most populous region -- would likely receive billions of dollars if the bond package is approved by voters.

``I think this is truly a historic agreement,'' said Assembly Speaker Fabian Nunez, D-Los Angeles. ``(It is) an investment in roads and highways, investment in schools, levees and affordable housing.''

Local projects that are likely to receive funds include building schools in crowded neighborhoods; extending the car-pool lanes on the 405 Freeway; developing urban housing and parks; and improving security and repairing roads at the Port of Los Angeles.

Mayor Antonio Villaraigosa, who had lobbied lawmakers to allot a fair share of funding for Los Angeles, praised the Legislature for its hard work and bipartisan support.

``This issue of infrastructure, building our schools, parks, housing, mass transit needs of the state, were too important to let partisanship create a divide,'' he said. ``I'm glad they were able to defy the naysayers.''

The bond package includes money for some of Villaraigosa's priorities, including school construction and environmental controls at the L.A. port.

Councilwoman Wendy Greuel, who helped lobby for public transit and transportation dollars in Sacramento in February, said she will introduce a motion asking the council to support the bonds.

``The importance of this bond can be summed up in three words: traffic, traffic, traffic,'' Greuel said. ``This bond is critical to getting Los Angeles moving again.''

Los Angeles Unified officials were still analyzing the proposal, but believe it could mean hundreds of millions -- if not billions -- for the state's largest school district, which is in the midst of a modernization program of its own.

Statewide, the bond would provide $1.9 billion for school construction, $3.3 billion for rehabilitation and modernization and $1 billion to relieve ``hyper-dense overcrowded schools.''

The overcrowding money, in particular, is expected to benefit the LAUSD, one of the most crowded districts in the state even with its gradually declining enrollment.

Right now, 300,000 of the LAUSD's 727,000 students attend class in portable classrooms. Even if the district builds 150 schools by 2012, it would still have 240,000 students in portables, according to district chief facilities executive Jim McConnell.

``If there was ever a district that needed help in critically overcrowded situations, it's L.A.,'' McConnell said.

The state formulas used to allocate the funds are complex, but they are based partly on enrollment projections, McConnell said. That presents a problem to the LAUSD: The district's enrollment is slightly declining, and that may result in a disproportionately large decrease in some funding sources, he said.

The district is lobbying lawmakers to change some of those distribution rules, though districts that benefit from the current formulas are likely to object, he said.

The $19.9 billion transportation bond includes $4 billion for public transit improvements, something state and local officials said could go to local projects such as Villaraigosa's plans to build a subway to the sea and a study of a north-south busway in the San Fernando Valley.

Another project expected to receive funding is the extension of the car-pool lanes on the 405 Freeway.

The decisions to allocate those funds will mostly be made by the California Transportation Commission.

The Legislature approved the package about 3:30 a.m. Friday after legislative leaders negotiated a tentative deal Thursday afternoon.

They stayed all night to finish the deal because they hoped to have the issue resolved before Schwarzenegger issues his revised 2006-07 budget plan next Friday.

They also hoped to vote quickly after a deal was reached so that outside political interests would not have time to pick apart the details and seek changes that could wreck the whole agreement.

There also was additional pressure from proponents of an initiative to protect transportation funding in Proposition 42, who were planning to turn in signatures on Friday.

The Proposition 42 ballot measure was shelved Friday after supporters heard the legislative package included a measure to protect the proposition. The bill allows raids on gas tax revenue to occur no more than twice a decade and imposes strict requirements for the repayments of those funds.

Assemblyman Keith Richman, R-Northridge, was one of the local legislators who voted for the package.

``This bond, if it's passed by the voters, will literally provide billions of dollars to the Los Angeles region, including the San Fernando Valley,'' Richman said.

Richman said he believes the bond package approved Friday is more fiscally responsible than one the Assembly passed earlier this year because it breaks the package up into four separate measures for voters.

State Sen. Tom McClintock, R-Thousand Oaks, voted against all but the levee bonds because he believes borrowing should be strictly limited to long-term projects that will last the life of the bond repayments, typically 30 years.

``Our kids are going to have their own potholes to fill and their own schools to repaint without having to pay for maintenance that was done 30 years before,'' McClintock said.

State Sen. Richard Alarcon, D-Van Nuys, who supported the package, said he successfully sought a provision to designate some funds for roads and other infrastructure near airports.

The provision, he said, could allow funds to be directed toward road improvements near Palmdale Airport, which many local officials have for years wanted to expand to relieve congestion at Los Angeles International Airport.

``This is a great opportunity,'' Alarcon said. ``This might stimulate that discussion. I'm hoping it does, and develops a process that will eventually get us to the point where we have another airport.''

Other measures the Legislature authorized as part of the package include streamlining some environmental regulations and authorizing four public-private partnerships on goods-movement projects and four high-occupancy toll lanes, with equal splits between Northern and Southern California.

The bill lets Caltrans enter into a lease arrangement allowing a private company to maintain roads that are primarily used for goods movement and impose tolls on those roads.

Another proposal to authorize the wider use of the design-build method of highway construction failed in the Legislature.

Staff Writer Kerry Cavanaugh contributed to this report.

harrison.sheppard(at)dailynews.com

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WHAT'S IN IT FOR L.A.?

A $37 billion bond package will go to voters on the Nov. 7 ballot. The package does not list specific projects, but there are some Los Angeles-area items that local and state officials believe are most likely to receive funding:

Extending car-pool lanes on the 405 Freeway

Studying a north-south busway in the San Fernando Valley

Synchronizing traffic signals in Los Angeles

Improving security at the Port of Los Angeles

Building and modernizing Los Angeles Unified schools

Retrofitting school buses to reduce smog

Providing incentives for infill development

Building affordable housing and homeless youth shelters

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WHAT'S IN IT FOR L.A.? (see text)