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Use of Publie-Funds,in Bond Referendum Campaigns' By David M. LaWrenCe ......... Institute of Government When a city or county is about to hold a bond referendnra, the following question often arises; for what purposes, if any, may the unit uso public funds in the referendum campaign? No North Carolina statute' addresses this question, and it has not been before the North Carolina But it has been before thc courts of several other states, and tho answer from those courts has been uniform; public money may be used to inform the voters about the bond issue and the project to bo financed with bond proceeds but may not bo.used to promote passage of the referendum. The distinction between information and promotion recognizes a tension that develops when a government uses public funds to address a controversial issue. The accountability we demand of public officials requires that they.bo able to explain fully the policies they have taken and hope to take, both the what and thc why. This explaining is necessary to our democratic system and is a legitimate activity, a~d expense, of the government. Therefore, informational expenditures are proper. Indeed the government will normally be in thc best position to know and provide information about a bond issue and a bond-financed project. But the government also must depend, for its continued legitimacy and public support-on the acceptance of its policies by the citizens or at least by a majority of those who vote for officials and in referenda. And to allow the usc of public moneys to create the basic acceptance undermines its authenticity. For that reason, promotional expenditures are improper. What kinds of information can be provided with public funds? A unit may properly spend pubic fUnds to present to the voters the relevant facts about a proposed bond issue, the project that will be financed with bond proceeds and the community needs that have given rise to the project. It may also describe alternatives to the project or the bond issue that Were rejected and state why they were rejected. For example, the unit might flnaace a brochure that sets forth tho project's costs, shows and architect's rendering of the project, explains why the governing board believes the project to be necessary and details that the borrowed funds will cost the unit. Such a brochure should be fully informative, setting out not only the conditions that the board believes require the project but also the additional taxes or utility charges that reasonably, will be necessary to retire the bonds. What clearly is not permitted are eXPenditures that attempt to persuade voters to support (or oppose) the ballot proposition. The sort of informational brochure discussed above should not, in addition to the basic information, also exhort voters to "Vote Yes" or include brilliantly painted depictions of the consequences of a negative outcome. The line between appropriate and inappropriate advertising can often be thin. Where a particular item fails can depend as much on the tenor of its message as on the message itself. For