The State’s Capital Debt Affordability Committee chaired by State Treasurer Nancy Kopp, approved a recommendation during its meeting on September 26 to increase the State’s bond authorization by $75 million to $1.160 billion for FY 2015. The recommendation, as brought forth by the Secretary of Budget and Management, Eloise Foster, on behalf of the Administration, actually proposed to increase the State’s bond authorization by $75 million in each of the next five fiscal years. However, the committee only approved an increase in the bond authorization for one year. The vote to approve the recommendation was 4-1.
A memorandum provided to the Committee by Secretary Foster summarizes the Administration’s recommendation:
The proposed increase to the State’s GO bond authorization levels for FY 2015 – FY 2019 will:
• Add a total of $375 million to the State’s debt capacity over the next five-year period while taking advantage of low interest rates;
•Allow the State to fund most of the projects called for in the Capital Improvement Plan (CIP) as well as accommodating the Watershed Implementation Plan expenses;
• Keep the affordability ratios comfortably within the State’s affordability guidelines; and
• Support the State’s ongoing jobs recovery. Almost 8 jobs are created for every one million in construction funding. Therefore, increasing debt levels by $75 million a year will support up to 3,000 jobs over the five year period, providing employment opportunities for citizens and generating additional revenue for the state.