Column: Three ballot measures on housing, medical research but only one no-brainer (2026)

A new house under construction is seen in Alhambra.

Capitol Journal Columnist

Sept. 21, 2026 6 AM PT

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SACRAMENTO — Three state bond measures are on California’s November ballot. You probably haven’t paid much attention to them. So here’s my read on these big-ticket proposals.

One is a no-brainer “yes.” It would help middle-class Californians buy a new home by allowing them to borrow most of the down payment. And it wouldn’t cost taxpayers a dime. That’s Proposition 37.

Another housing measure is probably worthwhile, but gives me pause because it accommodates too many interests in order to attract broad political support. And it burns a barrel of money. That’s Proposition 1.

The third proposal would fund important medical research. But I wince because it was written to largely benefit one institute that was co-founded and is headed by the measure’s chief backer. That’s Proposition 38.

Propositions 1 and 38 combined would add $18.4 billion to the state’s general fund bond debt, which already is about $80 billion, according to the nonpartisan Legislative Analyst‘s Office.

Plus, there is $40 billion in previously authorized bonds waiting to be sold. The new bond proposals would cost the state at least $1 billion annually for 20 to 25 years. Taxpayers are paying about $6 billion annually to retire state bonds.

Bonds are boring, but they’re also tax eaters. So we should pay some attention before voting on them.

“People think about bonds as free money. And, of course, they’re not,” says Mark Baldassare, polling director for the Public Policy Institute of California. “People don’t think bonds are going to raise their taxes.”

But most bonds are repaid by the state’s general fund, the main cash box that finances major programs such as education, healthcare, prisons and fighting wildfires. Bond debt has No. 1 dibs on the money. When revenue runs short — a common dilemma in Sacramento — other programs must be cut or taxpayers are hit harder. So bonds aren’t necessarily tax-free.

Baldassare released a PPIC poll last week that found a majority of likely voters supporting all three bond measures — especially Proposition 37 to ease homebuyers’ down payments.

The pollster noted that fall election campaigns are just starting and opposition arguments could reduce support for the measures.

But there’s no organized opposition to the two housing proposals. And although the medical research measure has some outspoken critics, there’s no money for an opposition campaign.

OK, a few specifics on each measure.

Proposition 37 is a taxpayer freebie, a $25-billion bond repaid solely by homebuyer beneficiaries. Here’s how it would work:

Middle-income people could pay 3% down on their home purchases rather than the normal 20%. They’d borrow the other 17% as a second mortgage and repay it along with the first mortgage.

The proposition defines middle class as household income that’s less than double the median for the area. Statewide, that income ceiling would be around $200,000 but would vary greatly by locale.

The purchased dwelling must be a brand-new home, whether stand-alone or a condo. That’s to increase the housing supply and create construction jobs. Politically, it gains the support of developers and unions.

No vacation home. It must be owner-occupied full-time. And the buyer must be a California resident.

The state’s sale of revenue bonds would create the down-payment pot. Regular lending institutions would arrange the loans and charge minimum fees. Loan repayments would replenish the pot and make it self-sustaining.

This was the brainchild of Bob Hertzberg, a former Democratic Assembly speaker and Senate majority leader from the San Fernando Valley.

Hertzberg tried several times to sell his proposal to the Legislature, but lawmakers wanted to juice it up with their own pet ideas. “I couldn’t get something just focused on the middle class,” he says. So he crafted this citizen initiative.

Proposition 1 proposes $11.25 billion in bonds for a smorgasbord of affordable housing.

This is the political establishment’s creation — Gov. Gavin Newsom, the Democratic-controlled Legislature and housing interests. There’s no organized opposition.

It was dressed up with $1.25 billion in popular CalVet loan bonds for military veterans. They repay their home loans through mortgages, costing the state nothing.

But the remaining $10 billion in bonds would be repaid through the state general fund, costing at least $500 million annually for 25 years.

The measure is mainly designed to generate affordable rentals for poor people. But to assure legislative passage, money was added for affordable student and farmworker housing, plus other goodies.

It’s a lot of money and makes only a small dent in California’s unaffordable housing plague. Moreover, it seems too scattershot.

But it could spare more people from becoming homeless — living in their cars or on sidewalks, ultimately costing taxpayers even more.

Then there’s Proposition 38, the problematic $8.4-billion general fund bond for medical research, including cures for cancer, heart disease and Alzheimer’s.

The hang-up for me and others is that the ballot initiative was crafted to virtually assure that half the bond money would go to one outfit, the UCLA-affiliated California Institute for Immunology and Immunotherapy. The institute was co-founded and is headed by the proposition’s originator and chief backer, billionaire Gary Michelson.

“I know opponents want to create a billionaire boogeyman, but isn’t curing cancer and other terrible diseases exactly what we want billionaires to spend their money on?” says Robin Swanson, a campaign spokesperson.

Sure. But being backed by a billionaire isn’t the problem. It’s being written to substantially benefit one research institute that’s led by the billionaire.

Two cancer survivors and political opposites — conservative consultant Jon Fleischman and liberal consultant Steve Maviglio — co-authored an op-ed that declared:

“Imagine either major political party proposing to borrow billions of dollars and writing the qualifications so narrowly that an organization founded and chaired by a principal campaign benefactor appears positioned to collect half the money. The other party would rightly howl. So should voters.”

They should at least be skeptical.

What else you should be reading

The must-read: California health clinics accuse influential union and its leader of racketeering in civil lawsuit
Danger zone: Newsom creates panel on AI safety regulation, suggests possible ‘kill switch’
The L.A. Times Special: Union power vs. MAGA politics in California’s schools superintendent race

Until next week,
George Skelton

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Ideas expressed in the piece

The column portrays Proposition 37 as a straightforward “yes,” emphasizing that it would let middle-income Californians buy newly built homes with a 3% down payment supplemented by a state-backed second mortgage of up to 17%, while repayments from borrowers — not the general fund — would retire up to $25 billion in revenue bonds and make the program self-sustaining.^[1]^[4]^[11]
It further suggests that Proposition 37 is tailored to the middle class by limiting eligibility to households earning no more than about twice the area median income and requiring owner-occupancy of brand-new homes, which the piece links to increased housing supply and construction jobs rather than speculative or vacation purchases.^[1]^[3]^[11]
At the same time, the article describes Proposition 1 as a large, scattershot but likely worthwhile $11.25‑billion general obligation bond package created by the political establishment, noting that roughly $10 billion would support a mix of affordable rental, student, farmworker and other housing programs repaid from the general fund, while $1.25 billion would finance CalVet loans for veterans at no direct taxpayer cost.^[5]^[7]^[8]
The column contends that Proposition 1 would make only a modest dent in California’s housing crisis yet could prevent more residents from falling into homelessness, arguing that the upfront cost — estimated at around $500–$600 million per year for roughly 25 years — may ultimately save money by reducing the social and fiscal burden of people living in cars or on sidewalks.^[5]^[7]
In contrast, the piece treats Proposition 38 as problematic despite its goal of funding immunology and immunotherapy research into cancer, heart disease and Alzheimer’s, highlighting discomfort with a structure that the article argues would effectively channel about half of the $8.4‑billion general fund bond to a single UCLA‑affiliated institute co‑founded and led by the measure’s principal financial backer.^[6]^[9]^[10]
The article warns that embedding such a preferential design in statewide bond law undermines public trust, citing critics who liken the measure to borrowing billions under criteria so narrow that one donor‑linked organization is positioned to receive a dominant share of the funds, and urging voters to be skeptical even while acknowledging the importance of medical research.

Different views on the topic

In contrast to the column’s enthusiasm, some policy analyses caution that Proposition 37 may not reliably make homeownership more affordable, noting that allowing incomes up to 200% of area median and home prices roughly in the $1 million to $1.5 million range could steer substantial aid to relatively higher‑income buyers purchasing expensive homes rather than to those most shut out of the market.^[3]
Moreover, critics point out that Proposition 37 would leave participating buyers carrying two mortgages, raising concerns about household risk if interest rates rise or incomes fall, and argue that the program’s broad eligibility — including non–first‑time buyers — could limit its impact on closing racial and generational homeownership gaps.^[3]
Housing advocates who support Proposition 37 nonetheless note that by restricting assistance to newly built homes, the measure’s benefits will depend on how quickly developers respond and where new construction occurs, with some warning that the program could concentrate in high‑cost regions and do little for communities where few new units are being built.^[2]^[3]^[11]
Opposing the column’s “scattershot” characterization of Proposition 1, many pro‑housing groups and local officials frame the bond as a critical infusion of capital for deeply affordable apartments, supportive housing and homeownership programs, arguing that a $11.25‑billion package could unlock tens of thousands of units statewide and leverage additional federal, local and private dollars.^[7]^[8]
These supporters emphasize that the annual debt service — estimated at about one‑quarter of 1% of the state’s general fund — is manageable within California’s budget and preferable to the mounting costs of homelessness, emergency healthcare and law enforcement, contending that long‑term bonds are an appropriate tool for financing long‑lived housing assets.^[5]^[7]
Nonetheless, fiscal watchdogs and some local commentators remain wary of Proposition 1, arguing that California already carries substantial bond debt and faces high per‑unit construction costs, so voters should question whether another large borrowing package will deliver enough new affordable housing relative to its 25‑year cost.^[5]^[7]^[8]
Diverging sharply from the article’s skepticism, supporters of Proposition 38 stress that the measure would distribute funds statewide, with half of the $8.4‑billion bond allocated through competitive grants to public and nonprofit universities and medical research institutions rather than exclusively to a single center, and assert that strict criteria and oversight would govern which UC‑affiliated institute is selected to receive the other half.^[6]^[10]
Proponents further argue that Proposition 38 includes consumer protections by requiring that any technology, treatment or drug developed with bond dollars be sold to California patients at prices at least 20% below the national average, presenting this discount mandate as a safeguard against profiteering and a justification for the long‑term general fund costs.^[10]
Supporters also highlight that immunology and immunotherapy are emerging areas with potential to transform care for cancer, heart disease and Alzheimer’s, and contend that state investment can accelerate breakthroughs that federal and private funding alone may not prioritize, portraying the involvement of wealthy donors and specialized institutes as an asset rather than a conflict of interest.^[6]^[9]^[10]
At the same time, critics outside the column’s pages raise governance concerns similar to those it cites, warning that Proposition 38’s structure appears tailored to favor a specific nonprofit linked to its chief funder and questioning whether California should incur roughly $500 million per year in debt service for 25 years when existing research funding mechanisms could accomplish similar goals with more competitive, arms‑length oversight.^[9]^[10]