Louisiana’s new legislative leaders quickly signed off Thursday on plans for the state to borrow up to $350 million to replenish the account that pays for state-financed construction work, the first major financial decision for the latest House and Senate term.
The Bond Commission, a panel of state officials that oversees publicly financed construction spending, agreed to the March general obligation bond sale without objection. The proposal provoked no discussion from the House’s and Senate’s new budget and tax committee chairmen, sitting on the panel for the first time in their new roles.
The borrowing will keep cash flowing to a long list of projects, including coastal restoration work, state park improvements, road and bridge projects, college building repairs and local projects favored by lawmakers.
The state will sell bonds to investors for upfront cash, then pay off the debt over 20 years with interest. Louisiana borrowed a similar amount of money for construction work last year.
Treasurer John Schroder, chairman of the commission, didn’t object to moving ahead with the bond sale plans, even as he’s repeatedly worried aloud about Louisiana’s debt load. After the meeting Thursday, he repeated those concerns and says he intends to talk to the new House and Senate leadership about ways to cut spending.
The amount of money Louisiana owes for every man, woman, and child exceeds the national average, according to the most recent report outlining the state’s per capita, tax-supported debt load. And Louisiana’s credit rating is low among states. Still, Louisiana remains below its debt ceiling, a cap enacted in the early 1990s that restricts how much the state can borrow each year for construction work. Read the full story.
