(Jefferson City) (AP) – Some Missouri officials, who recently paid off the equivalent of a 30-year mortgage on dozens of state buildings, want to take out a new loan.
When they convene in January, Missouri lawmakers will consider whether to ask voters to authorize a new bond issuance worth as much as $1 billion to finance construction at college campuses, repairs at state mental health institutions and office buildings and maybe even new road work.
Senate Appropriations Committee Chairman Kurt Schaefer, who plans to sponsor a bonding bill, says that there are “historically low interest rates, construction costs are down, which makes it a perfect time for bonding.
Even so, Missouri must have the means of repaying the bonds – a factor that stalled similar proposals during the recent lean budget years. Many lawmakers think that criterion now has been met, since the state made its final payment in October on the Third State Building Fund. That means millions of dollars that had been committed to old debt payments now is available for a new use.
A narrow 51 percent majority of Missouri voters authorized the issuance of $600 million of bonds during a June 1982 special election to finance improvements to state buildings, parks and a variety of “economic development” projects such as water and sewer systems, highways, rail lines and efforts to curb soil erosion. The bonds were to be issued over the next five years, and repaid during the ensuing 25 years.
The House passed a $700 million bonding plan for higher education institutions in 2009, but it later was expanded and ultimately abandoned in the Senate. Critics said the state shouldn’t take on so much debt in the midst of a recession.
The state ended up with $636 million of principle payments from the 1982 initiative, because a refinancing of the original bonds resulted in additional principle being issued. By the time all the interest was paid, the total bill came to $1.25 billion, according to figures from the state Office of Administration.