State’s Voters Face Longest List of Issues in 66 Years : $1 Billion in Road Bonds Defeated by Tiny Margin

SACRAMENTO — Proposition 74, Gov. George Deukmejian’s $1-billion transportation bond measure, was rejected in the June 7 primary election by a tiny margin of 355 votes out of more than 5.2 million cast, Secretary of State March Fong Eu announced Wednesday.

The defeat of the proposition represents a serious setback for Deukmejian, who had proposed issuing $1 billion in bonds as the centerpiece of his plan to relieve traffic congestion and improve California’s transportation network.

Ever since the election, the result on Proposition 74 had been too close to call as counties completed their official canvass of the balloting. Another 298 ballots remain to be tabulated from a precinct in Pomona, but there are not enough uncounted votes to affect the outcome, said Melissa Warren, a spokeswoman for Eu.

In all, 2,640,878 people supported Proposition 74 while 2,641,233 cast their ballots against it, a vote of 49.99664% to 50.00336%. The gap was the narrowest since 1908, when a ballot measure providing compensation for public officials passed by only two votes.

Deukmejian, who campaigned personally for the measure around the state, is considering seeking a recount of the votes in selected precincts, said Kevin Brett, his press secretary. The governor has until Monday to request a recount.

Brett contended that the defeat of Proposition 74 was not a clear rejection of Deukmejian’s plan to use bonds to finance transportation projects. He said the governor is considering placing a similar bond measure before the voters at another election.

“You can’t draw a definitive conclusion of whether the public supports the use of bonds for transportation,” Brett said. “The margin is razor thin. . . . You can’t draw any absolute conclusions.”

Becomes ‘Delta Duke’

During the campaign, Deukmejian promoted Proposition 74 by assuming the name “Delta Duke” and serving as a radio traffic reporter in Los Angeles and the San Francisco Bay Area. He said the bond measure, part of his $8-billion transportation program, would speed the construction of hundreds of transit projects around the state.

Opponents of Proposition 74, however, maintained that paying interest on the $1-billion debt would cost far more in the long run than simply raising the gasoline tax to pay for highway projects. Former Democratic Gov. Edmund G. (Pat) Brown took to the airwaves and argued that the state should not abandon its “pay-as-you-go” approach.

“I think that the voters showed unusual wisdom in rejecting Proposition 74,” said Assemblyman Mike Roos (D-Los Angeles), who also was a leading opponent of the measure. “The fact is, this would have put more money in the pockets of bankers and bond salesman than it would have in the concrete and new roadways that we need to accommodate all this new demand.”

The rejection of Proposition 74 was yet another in a string of defeats for Deukmejian over the last two months. Confronted with a $2-billion budget shortfall, the governor proposed a tax increase, only to withdraw it in the face of political opposition. Then, the California Supreme Court rejected the governor’s argument that his nominee for state treasurer, Rep. Daniel E. Lungren, should be sworn into office even though he was denied confirmation by the state Senate.

Dashes His Plans

Now, the defeat of Proposition 74 dashes Deukmejian’s plans for dealing with California’s growing transportation crisis. With the voter’s rejection of the bond issue--and Deukmejian’s own refusal to increase the gasoline tax--the state will have little extra money to pump into its highway and mass-transit programs.

“This means we are back to square one on the need to provide an ongoing source of substantial additional funding for California’s transportation system,” said a disappointed Kirk West, president of the California Chamber of Commerce and a backer of the measure. “The traffic gridlock problem will not go away and will only get worse unless we find a way to fill that need.”

With millions of additional cars expected to clog the state’s freeways, transportation could become a politically volatile issue that could damage Deukmejian if he decides to run for a third term as governor in 1990.

While voters rejected Deukmejian’s measure on June 7, they approved a record $2.2 billion in bond issues for a variety of other programs, including buying park land, building schools and providing loans to California veterans.

The last time a bond measure was defeated was 1980, when the voters rejected a proposal to spend $85 million to acquire and preserve land in the Lake Tahoe area.

Loses in Los Angeles

In Los Angeles, where traffic is the heaviest in the state--and where Deukmejian focused his efforts--the voters rejected Proposition 74 with 656,626 people favoring it and 695,110 opposed. The bond measure carried in most other urban counties, including Orange, San Diego, San Francisco and Santa Clara.

The final tally is expected to change slightly because the ballots in one precinct in Pomona are missing. An investigation by the Los Angeles County Sheriff, the district attorney’s office and the secretary of state’s office was unable to turn up the ballots, but Eu’s office said there is no evidence of fraud or criminal activity.

To avoid disenfranchising the voters in that precinct, all 298 people who cast ballots June 7 will be allowed to vote again, this time by mail. Their ballots are due July 15 and after they are counted, Eu will certify the election results for the entire state.

“Re-casting these ballots will not affect the outcome of any race,” Eu said in a statement. “Despite the narrow margin in the case of Proposition 74, there are not enough votes in the precinct to make the difference.”

Under the rules of requesting a recount, whoever asks for a re-tabulation would be required to pay the cost if the result of the election remains unchanged. The cost of a statewide recount could reach $2 million, but Deukmejian or his campaign organization could ask for a recount in specific counties or precincts.

Poll Shows Disagreement

A Los Angeles Times Poll conducted on Election Day showed that voters disagreed with Deukmejian that the state should change its “pay-as-you-go” method of building highways. Democrats and Republicans alike agreed by 3 to 1 that “Californians should continue to finance highway construction on a pay-as-you-go basis with gasoline taxes and not by borrowing bond money that costs interest.”

Even about two-thirds of those who voted for Proposition 74 said they preferred “pay-as-you-go” financing, apparently believing that the bond measure was the only available option for improving the highway system.