Essay: The $1 billion Capitol Annex Project is not a good deal for taxpayers when the state has more pressing needs

By W. Bruce Lee

All too recently, we anticipated a $54 billion state budget deficit, expecting cuts that would continue the economic onslaught of the COVID-19 pandemic. In the new year, however, we find ourselves with a $15 billion one-time budget surplus and a proposed 2021-22 budget of $227 billion.

We should welcome this good news, as Californians have endured stay-at-home orders, job losses and countless other consequences of the devastating pandemic. The governor’s plan to direct funds to schools, small businesses and even provide small refunds to taxpayers could mark the beginning of our state’s slow recovery.

However, we should urge our governor and Legislature to spend with caution, and only when it truly benefits California’s taxpayers. So it should not be too much to ask that a luxury project that sidelines the needs of Californians should itself be sidelined.

The $1 billion Capitol Annex Project would demolish and rebuild the historic Capitol Annex that houses lawmakers’ offices, build an underground parking structure exclusively for high-ranking elected officials and construct a visitors center.

To put this sum in perspective, consider similar spending outlined in the state’s proposed budget: $1 billion for a wildfire and forest resilience plan; $1.1 billion in relief for small businesses; and $1.5 billion to achieve the state’s zero-emission vehicle goals. There is no doubt $1 billion can go far in helping Californians, so why waste it on a project that would only benefit our politicians?

Certainly, ensuring the safety of our legislators’ workplace is important. Yet, experts say that the Capitol Annex can be retrofitted to address health and safety concerns for a fraction of the project’s cost. Additionally, a “swing space” that would house legislators during the renovation is already funded at $450 million, with office space and parking aplenty that could be used permanently. As for the visitors center, moving forward with a Disneyland-like attraction during a pandemic is ill-conceived.

Most concerning of all is how the project would be funded. Since it was approved using revenue bonds in a fiscal emergency, that means we are racking up 30% more in interest to be repaid over 30 years, ballooning the cost of the project.

To make matters worse, the Capitol Annex scheme was concocted with little to no input from interested parties or the public. The Legislature denied project information to the Historic State Capitol Commission, which was created by the legislature in 1976 to protect the Capitol’s historical and architectural integrity. Two commissioners resigned in protest. Why all the secrecy?

Even without the COVID crisis, the Capitol Annex project is a stunning waste of taxpayer dollars, especially when the state has so many pressing matters that need to be addressed. While we can be hopeful about the budget surplus, we need to face the realities of today. Californians are still struggling to put food on the table, many remain unemployed and many continue to face eviction and homelessness.

There is no doubt $1 billion can go far in helping Californians, so why waste it on a project that would only benefit our politicians?

While the proposed 2021-22 budget did not include details on the Capitol Annex plan, we should surely keep an eye out for a budget trailer bill, given the Legislature’s continued efforts to cloak the plan in secrecy.

As the Legislature resumes session, they have a responsibility to Californians to focus on our economic recovery. The Sacramento Taxpayers Association joins other taxpayer groups, small businesses, preservationists and environmentalists in calling on Gov. Gavin Newsom and legislators to pause the Capitol Annex Project and reevaluate its need with input from experts and the public.