LA WATCHDOG - Californians are being asked to approve or reject Proposition 38 that would authorize the State to issue $8.4 billion in general obligation bonds to finance “breakthrough immunology and immunotherapy research to develop life-saving cures for the most persistent and debilitating diseases impacting all California families, such as cancer, Alzheimer’s and heart disease. This initiative represents real hope and promising cures to help save your life and the life of someone you love.”
Importantly, the proponents say Proposition 38 “will fully pay for itself with no cost to the state or taxpayers. Ten percent (10%) of all proceeds from the licensing of immunotherapies must be returned to the State of California to offset the total cost of the bond measure, including interest.”
Similar claims were made in connection with two previous medical research propositions. But to date, there is no evidence that the repayment claim was accomplished for Proposition 71 (the $3 billion Stem Cell Research Initiative) that was approved by 59% of the voters in 2004 and Proposition 14 (the $5.5 billion Stem Cell Research Initiative) that was approved by 51% the voters in 2020.
Furthermore, the two Independent Citizens Oversight Committees have not been transparent in that any reports or findings are either unavailable or very difficult to find.
To earn our votes, the supporters of Prop 38 along with its major sponsor, Dr. Gary Michelson, need to report on the finances of Prop 71 and Prop 14, outlining the results and benefits of the research as well as the direct revenues to the State that were used to amortize the bonds. The Prop 38 supporters should also provide voters with projections and the underlying assumptions on how the 10% of the licensing fees will amortize the newly issued general obligation bonds.
*************************
AUTHORIZES BONDS FOR IMMUNOLOGY MEDICAL RESEARCH. INITIATIVE STATUTE. Authorizes $8.4 billion in general obligation bonds for immunology and immunotherapy research, half to a single University of California-affiliated nonprofit medical research institute, half to research grants. Fiscal Impact: Increased state cost of $500 million to $600 million annually for about 20 years to repay the research bond, with some or all of the cost offset if the funded research generates revenue.
(Jack Humphreville writes the LA Watchdog column for CityWatch, where he covers city finances, utilities, and accountability at City Hall. He is President of the DWP Advocacy Committee, serves as the Budget and DWP representative for the Greater Wilshire Neighborhood Council, and is a longtime Neighborhood Council Budget Advocate. With a sharp focus on fiscal responsibility and transparency, Jack brings an informed and independent voice to Los Angeles civic affairs. He can be reached at [email protected].)
