How California's Oil and Water Policies Are Bankrupting Higher Education
By Patrick Porgans and Seth Sandronsky, AlterNet
Posted on May 27, 2010, Printed on June 23, 2010
http://www.alternet.org/story/147007/
Oil and water don't usually mix -- except in California politics. Over the last
couple of decades, interests representing offshore oil extraction and inland
water infrastructure have teamed up, using their muscle to de-fund a
once-famous system of public higher education.
On the gubernatorial watches of governors Edmund "Pat" Brown, Sr., a Democrat
(1959-1967), and Ronald W. Reagan, a Republican (1967-1975), a bipartisan
siphoning of tax dollars earmarked initially for higher education began to flow
to the State Water Project (SWP), one of the largest water and power systems in
the world. It conveys an average annual 2.4 million acre-feet of water in
California through its 17 pumping plants, eight hydroelectric power plants,
three pumping-generating plants, 29 dams and reservoirs, and about 675 miles of
aqueducts and pipelines.
The money came from a little-known source of public funds: tidelands oil
revenue. This energy source, publicly owned, lies off the California coastline,
mostly near Long Beach and the state receives a share of the money made from
the oil recovered in the tidelands. How this money, which was originally
intended to help ensure that Californians could afford higher education, ended
up being shifted to the SWP has largely occurred at the margins of the public
radar screen.
Education vs. Water
The state's 1960 Master Plan for Higher Education established as a goal that
the University of California and California State University system, and the
junior (now community) colleges should admit and enroll all eligible California
students. Then, higher education was more accessible and affordable than it is
now, due in part to the flow of revenue from tidelands oil.
But that didn't last. When Reagan was governor, he boasted that "we'll trade a
university for some water," according to author and economist Michael Perelman.
The re-routing of tidelands oil revenue from higher education to the SWP helped
to change California's policy priorities and its commitment to upward mobility
via post-secondary study. According to data from the California State
University system, "The Capital Outlay Fund for Public Higher Education
(tidelands oil revenue) was the CSU's primary source of funds prior to fiscal
year 1985-86. The revenue from this source diminished significantly and CSU
priority needs were beyond the available funds."
Note the use of the passive voice in the last sentence. In fact, the State
Lands Commission, state Department of Water Resources and state Legislature
shifted (public funds) tax dollars from higher education to water
infrastructure construction.
The amount of CSU money from the tidelands oil revenue for the 23 years ending
in 1985-86 was $528.3 million, according to the CSU system, $65 million more
than the State Lands Commission figures. It is worth noting that a near exact
amount, $508 million, flowed from the California Water Fund to finance costs
associated with the SWP.
The SWP Boondoggle
According to Mark Arax and Rick Wartzman, authors of The King of California:
J.G. Boswell and the Making of a Secret American Empire, Gov. Pat Brown (father
of Jerry Brown, the state's current attorney general, past mayor of Oakland and
two-time governor), "sought to solve California 's great conundrum: Most of the
water is in the north, while most of the people are in the south."
While the SWP sounds good on paper, the actual project has been a boondoggle --
it was sold to the public as a project that would pay for itself, but it never
has. In fact, SWP costs have exceeded $6 billion and there is no end in sight.
"The Project was underfinanced since the very start," said Reagan. "It was not
my intention to dwell in this, but the people were allowed to believe that the
original bond issue would cover the program cost. This was never true."
The water infrastructure construction actually began knowingly under-financed
and contractually over-committed. The financial impacts of that flawed start
would propel the state to change its financial support for higher education and
water-works projects.
Full at
http://www.alternet.org/water/147007/how_california%27s_oil_and_water_policies_are_bankrupting_higher_education
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