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OPINION: State bond issue: Worth considering in the coming term
(Columbia Daily Tribune (Columbia, MO) Via Acquire Media NewsEdge) Nov. 22--Not long ago in this space, I proposed a big federal infrastructure spending plan focused mainly on road and bridge construction along with other transportation elements to be underwritten with deficit financing.
The only way for government to stimulate the economy is with borrowed money and, regardless of the need for economic stimulation, basic infrastructure all over the nation is ailing and getting worse. It is vitally important to reverse this trend and it won't be done without a frontal attack.
I also said a significant federal tax on motor fuel would be a good idea, with the proceeds rebated dollar-for-dollar and state-by-state, thus avoiding the interstate tax rate competition that stymies state tax hike plans.
Now I'm here to reiterate an earlier suggestion for the same sort of plan in Missouri, a big bond issue for transportation and higher education infrastructure, with other goodies added to sweeten the pot. This would be patterned after the successful $600 million bond issue floated by then-Gov. Kit Bond for projects all over the state, easily passed by the public and just now being paid off.
The need is urgent and the time is right. Lord knows, the economy can use a boost. Lord knows, our transportation and higher education infrastructure are important public investments. And, serendipitously, the Bond bonds will be finally paid off in the next two years, not a make or break factor but a good talking point.
The Missouri Department of Transportation in particular faces a funding whammy. Proceeds from a recent bond issue are coming to an end but repayment requirements continue, and ongoing tax revenues from fuel and auto sales are in decline. Last year the department had $1.3 billion to spend. This year it's down to about $860 million and expected to fall to around $565 million next year.
We've known for some time about this shortfall, but nobody has taken the lead to meet the challenge. It's perfectly clear, and has been for some time, current revenues will not close this gap even if economic times get better. Can new/old political hands get a proper discussion doing?
Actually, some of the incoming Democrats have longer memories than many of the short-termers now rotating through the halls of the capitol. I'm thinking of seasoned hands like Wayne Goode, Jay Nixon and Chris Kelly, who surely remember the value of the Bond bonds.
An equivalent number in today's dollars might be double the Bond amount, say $1.2 billion. A general obligation bond issue would have to include authority for the state to raise property taxes, as the earlier bond did, but in that case the repayment amounts were handled in yearly budgets without a tax increase. No such guarantee can be made in the future, but over 20 years the growing state economy will be able to cover the annual payments. In the meantime we will benefit greatly from the construction projects.
I hope serious discussion of this idea will surface early in the next legislative session.
Henry J. Waters III, Publisher, Columbia Daily Tribune
A candle loses nothing by lighting another candle.
-- The Rev. James Keller, founder of The Christophers
To see more of the Columbia Daily Tribune, or to subscribe to the newspaper, go to http://www.columbiatribune.com/.
Copyright (c) 2008, Columbia Daily Tribune, Mo.
Distributed by McClatchy-Tribune Information Services.
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