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L.A. City Councilmen Propose Massive $3 Billion Bond to Fix Streets

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A pair of Los Angeles City Council members today proposed a $3 billion, 20-year bond to repair thousands of miles of damaged city streets.

City Councilmen Mitchell Englander and Joe Buscaino, who represent the far corners of the city, from the Northwest San Fernando Valley to San Pedro, introduced a motion to place the bond measure on the May 21 citywide general election ballot.

If approved, the owner of a $350,000 home would pay about $24 more in property taxes during the first year of the bond, according to Buscaino Chief of Staff Doane Liu. The property tax increase on such a home would peak at about $120 above current levels in 10 years before the city's rate of borrowing begins to decline, Liu said.

Buscaino billed the plan -- called the "Los Angeles Emergency Local Street Safety And Traffic Improvement Measure" -- as the "largest public infrastructure project in the country."

The council members say the bond measure is necessary, because the city cannot afford on its own the estimated $300 million annual cost to fix some 8,700 lane-miles of damaged streets. The city budget for the current fiscal year is running a deficit and city leaders will be tasked with closing an estimated $216 million budget hole for the fiscal year that starts in July.

"A general obligation bond, approved by the voters, is the only option to secure sufficient funding to accomplish this work within a realistic, 10- year time frame," the motion states.

The council members are planning a major public roll-out of the plan over the next week, including press briefings and pitches to newspaper editorial boards.

"This is absolutely the biggest issue in infrastructure facing the city of Los Angeles," Englander said.

The motion instructs the city attorney to draft the resolution to place the bond measure before voters. The council must approve the instruction by Wednesday in order to get it on the May 21 ballot, according to the city clerk's website.

Jan. 30 is the final deadline for the council to approve placing the bond measure before voters in May.

The motion also instructs the City Administrative Officer and Bureau of Street Services to prepare analyses of the plan.

The poor condition of the city's streets affect "the environment, traffic, goods-movement, and public safety," Englander said. "There's more people that die in traffic accidents from the conditions of our streets than almost all other crimes committed."

Thirty-eight percent of the city's street system got failing grades of "D" or "F" in the most recent Bureau of Street Services 2011 State of the Streets Report. Repairing "D" and "F" streets costs about $325,000 and $630,000, respectively, Englander said.

Buscaino and Englander are also expected to pitch the plan as a job- creator. Buscaino predicted the work would create 30,000 private-sector jobs.

The measure would not pay for repairs to city sidewalks, which are estimated to cost more than $1 billion.

Despite the price tag for the work, Englander said the measure would be a net savings to city residents, who he said pay about $750 per year in maintenance for their cars because of the conditions of city streets.

"We're the highest cost of car ownership and maintenance of any large city in the country," he said.

The bond measure would pay for an inventory of every city street and would include comprehensive online displays of what streets are being fixed and when, the councilmen said.

Englander and Buscaino said they were influenced by the advice of UCLA Anderson School of Business Professor Edward Leamer, who called the measure "good borrowing." Leamer argues the low cost of borrowing -- interest rates for cities are at their lowest level in 40 years -- and the resulting street repairs would likely increase property values throughout the city by more than the total cost of the loan.

"In addition to the damage that is done to vehicles, the poor quality of the streets of the city sends a subtle, but clear message to our citizens, potential businesses and our visitors," Leamer said in a letter to city leaders last month. "Los Angeles is a city of the past and not of the future. The city of Los Angeles cannot afford to send this signal."

Mayor Antonio Villaraigosa had not yet seen the proposal and was not prepared to comment until next week, a spokesman said.

Story by Richie Duchon, City News Service

This story has been updated with more information since its original posting.

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