State House gives nod to $184M in bonds
Published: February 20,2013
JACKSON — House members want the state to borrow more than $184 million, mainly for new buildings at Mississippi’s community colleges and public universities.
The House passed bills to borrow $120 million for universities, $25 million for community colleges and $3 million for a statewide community college headquarters. Members also agreed to borrow $5 million to preserve historic sites and $250,000 to improve the Mississippi Crafts Center in Ridgeland.
Earlier this year, the House passed a $31-million bond bill for a new University of Mississippi medical school building in Jackson, and the chamber also plans a bond bill to support state agency projects overseen by the Department of Finance and Administration.
However, it remains unclear what Republican Lt. Gov. Tate Reeves will agree to. In 2012, the House and Senate couldn’t agree how much to borrow, and the state authorized no new borrowing for the first time in at least 15 years.
“I don’t know that I have a specific goal yet,” Reeves said, repeating his position that he wants a bond bill that is “reasonable and rational in size.”
That uncertainty was also reflected by House Ways and Means Committee Chairman Jeff Smith, R-Columbus, who told House members he wasn’t sure if senators would approve requests that large.
“We have a Senate on the other side that thinks somewhat differently and we’re trying to figure them out,” he said.
Smith said he thought senators would agree to a borrowing total in the range of $200 million. That’s less than the $230 million-plus the state expects to pay off from its $4.1 billion in debt. But Reeves said the state shouldn’t borrow that much because some bonds authorized in previous years have yet to be issued. Though lawmakers didn’t authorize new borrowing in 2012, the state still sold bonds in the fall.
“If the Legislature did zero in new bond authorization this year, the state of Mississippi would have another debt issuance in 2013,” Reeves said.
Legislators must authorize bonds, then a majority of the three-member Bond Commission must vote to issue them.
House Bill 1618, which borrows money for the state’s eight public universities, is actually a three-year plan to borrow $120 million a year, or $360 million overall. The College Board has pushed for year-to-year predictability so schools can get started on big projects with some assurance that money will continue to flow long enough to finish them. In the past, some schools have waited several years to start construction, until enough money was in hand to finish.
“It takes care of our colleges for the next three years and will make you very popular if you happen to go on a college campus,” Smith told House members.
Reeves has already won one significant victory in his push against debt. Early in the session, the House passed a bill to spend $72.6 million in cash on various projects that had been considered for bonding last year. That measure included money to replace roofs, replace county bridges, buy fire trucks for small fire departments and pay for state accounting software.
“To me, that’s a great step in the right direction,” Reeves said. “We’ve got to get out of the habit of issuing long-term debt for items that have a shorter shelf life.”
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