Fitch: Revenue Bond Vote May Slow or Stop California Water Fix

Approval of Proposition 53 by California voters this week would likely slow or prevent a $17.1 billion water project known as the California Water Fix, according to Fitch Ratings. The project’s timing and cost are important to the state’s water and sewer utilities. Even if Proposition 53 is not approved, the long-term plan for the project will remain controversial.

Proposition 53, if approved, would require revenue bonds issued by the state of California exceeding $2 billion dollars to be approved by two-thirds of voters. General obligations bonds, which are paid with taxpayer dollars, already require voter approval. Revenue bonds, which are paid by user fees including water rates, do not.