Prop 98 would lead to overcrowding by making it more difficult to build new schools or expand old schools. 

Respected education organizations like the California Teachers Association and the California School Boards Association oppose Prop. 98 on the June 3, 2008 ballot because it would make it much more difficult to build new schools or expand existing ones to relieve overcrowded classrooms. That is because the measure makes major changes to laws governing use of property, including use of eminent domain and regulation of land use. These changes could have a significant impact on the construction of needed new schools.

•·        Making significant changes to the practice and costs of acquiring  
   property to build schools

•·        Preventing local jurisdictions from requiring developers to donate 
   land for new schools, or pay fees

•·        Increasing school districts' liability when acquiring property to build 
   schools

Constitutional Changes to the use of Eminent Domain That Could Impact School Districts

•·         Acquiring immediate possession of property made more complicated.  Under existing law, a public agency may deposit the estimated just compensation and gain immediate possession of the property.  The property owner is limited to challenging what constitutes "just compensation" if the deposit is withdrawn.  Under Prop. 98, the property owner will also be able to challenge whether the public agency has a right to take the property.  This means that it would be possible for a public agency to take immediate possession of the property and for a court to subsequently rule that the public agency had no underlying right to acquire the property at all.  

•·         Changing the use of school property made more difficult.  Prop. 98 would require that before a property acquired by eminent domain could be used for a substantially different purpose than the one it was acquired for, the agency must make a good faith effort to locate the original owner.  This would impose a significant burden on school districts who, when faced with declining enrollment, need to alter the use of school property.

•·         The definition of "just compensation" is changed.  Existing law provides reasonable certainty to both the public agency and the private property owner thereby reducing the need to go to court to determine "just compensation." Prop. 98 will likely require more frequent recourse to the courts to understand how to apply the new definition.  In addition, the initiative requires a public agency to pay the property owner's attorney's fees if the jury awards one dollar more than the amount offered by the public agency.  It also includes elements not currently recognized such as temporary business losses in the calculation of "just compensation."

•·         Balance of power shifted to courts.  When a public agency makes findings explaining the need to exercise eminent domain, those findings are entitled to a strong presumption of validity when challenged in court.  In addition, the court is limited to reviewing the administrative record that was before the public agency.  Prop. 98 changes this balance of power between the legislative and judicial branches of government by removing the presumption of validity and allowing the property owner to introduce evidence to the court that was not previously a part of the administrative record before the public agency.   

Prevents Local Jurisdictions from Requiring Developers to Donate Land or Pay Impact Fees for New Schools.

Prop. 98 defines "taken" (and subsequently prohibits such takings) to include "transferring the ownership, occupancy, or use of property form a private owner to a public agency or to any person or entity other than a public agency."  This definition could prohibit requiring developers to donate land used to build schools and other public improvements as a condition of their development. 

Additionally, their definition of "private use" would prohibit actions that transfer an economic benefit from one private party to another. Although developer fees must be roughly proportional to the impact of the development on public facilities or services, third parties can also benefit from the fees. Existing development obtains an economic benefit in the use of, or increased property value from, new public facilities, such as parks and schools, financed in part with impact fees.  At minimum, those opposed to school impact fees would likely litigate questioning their legality should Prop. 98 pass.

Increases Liability Over School Construction and Expansion Projects

Prop. 98 prohibits a public agency from regulating the use of private property if the regulation "transfers an economic benefit" from the regulated property owner to another private property owner. Nearly all traditional land use regulations economically benefit some properties while burdening others. Read literally, this provision would make unconstitutional virtually all regulation of land use.  So, neighbors who didn't want to have a school built near their homes could sue saying that because of noise, traffic, etc., the school would transfer an economic benefit from them (by lowering property values) to the neighbors of the school site that wasn't picked.