McCrory urges lawmakers to act on bond plan, but they aren’t so sure

Gov. Pat McCrory was joined by hundreds of county and city officials Tuesday as he pressed his case for a $2.85 billion bond proposal to fund road and infrastructure projects, but the General Assembly is not completely on board with the governor’s plan.

With low interest rates and imminent highway and building needs, McCrory said the time to act is now. He wants to see a $1.37 billion highway bond and a $1.48 billion infrastructure bond on the election ballot this November.

The governor calls the bond plan “Connect NC,” which executes the goals he laid out and has been pushing since his February State of the State address.

“There is a sense of urgency that we need to make these investments now, especially at a time when we're the 9th largest state in the U.S. We need to prepare for the future instead of react to the future,” McCrory said during a Tuesday media conference at the Executive Mansion with at least 100 local officials standing on the stairs behind him in support.

“If we invest in the future, we can beat our competition for jobs. It's going to be a major selling point when we invest in our universities, our community colleges, our roads, and our parks -- that we're selling quality of life of North Carolina and opportunity,” McCrory added.

However, Senate leaders have laid out a different plan to fund highway and bridge construction in their budget and want to pay cash instead of getting into debt.

The Senate budget plan is to stop the yearly transfer of $216 million in gas tax receipts to the state’s non-transportation General Fund.

It would keep that money for the Department of Transportation and use most of it to increase capital spending by about $170 million a year - enough to pay for 60 or 70 additional new highway projects.

“By doing it ‘pay as you go,’ all the money you spend is on the road projects, no money would be spent on the debt service, which is what you would be paying in interest on those bonds,” said Senate Finance Committee co-chair Sen. Bob Rucho on Tuesday.

House Transportation Committee co-chair Rep. John Torbett is not so optimistic about the Senate’s transportation plan.

“You can do the math a hundred different ways and it doesn't add up to all the needs,” he said. “The governor's bond doesn't take care of all the needs, but it takes care of the most immediate so we can get some projects off the list and get ahead of it finally for a while.”

Torbett said the bond would be a good business move because the cost of borrowing money is low and it wouldn’t raise taxes.

The Senate also has its own plan for infrastructure repairs, Rucho said.

“We put about $350 million in repairs and renovation fund over the biennium. That is a huge amount to put back into our buildings so that they can be run efficiently,” he said.

However, that still won’t cover all the capital projects, and Rucho said that at some point, there may be room to look at a bond. Sen. Tom Apodaca, Rules Committee chairman, has also gone on record saying that he sees the infrastructure bond “picking up momentum.”

Rep. Dean Arp, chairman of the House Appropriations Capital Committee, said the House created two plans in its budget to address infrastructure.

“One was with the bond, and one was if the bond doesn't occur for whatever reason,” Arp said. “We wanted to make sure that the state provides for the necessary capital that we need [...] So kind of a way to provide a dual path.”

He said that the bond is more encompassing, providing a longer term look, while the budget only addresses the next two years.

“The bond proposals set up the financing for project that will occur over the next 25 years,” Arp said.

House Speaker Tim Moore has said he isn't convinced that the issue should go to voters in November, noting that it would draw a bigger turnout if held during the 2016 presidential primary.

The State Board of Elections had requested that the ballot measure be submitted by June 30, but McCrory said state law allows about one more month.

“We have more time. Let's use it and not waste it,” he said. “We need to get both chambers involved.”

This story was originally published June 30, 2015 at 7:59 PM with the headline "McCrory urges lawmakers to act on bond plan, but they aren’t so sure."