The state House is engaging in a kind of blasphemy in a General Assembly that has spent four years cutting taxes, squeezing spending and neglecting the state’s upkeep. The House has approved a bond package that would direct $2.85 billion toward investing in North Carolina’s future.
Most of the proceeds would pay for university and school construction and put $400 million toward transportation. The House plan also calls for an additional $1.3 billion in transportation projects that would be funded through budget allocations without borrowing.
It’s a reasonable plan that would strengthen education, maintain transportation and create jobs. Voters would likely support it. The House on Thursday changed the proposed bond vote from this November to the 2016 primary date, likely to be March 15.
In many states, borrowing would be standard procedure. But since Republicans took control of the General Assembly after the 2010 election, borrowing has become borderline immoral.
Rep. Mark Brody, a Union County Republican who voted against the bond package that passed 76-29 Thursday, expressed that sentiment when he said, “I kind of like the thought of being debt free. We found a credit card with zero interest on it, and as good stereotypical politicians ... we just can’t resist spending it.”
Fortunately Brody’s perspective wasn’t shared by a combination of Republicans and Democrats who know there’s a difference between how one manages a credit card and how a legislature supports a state.
This switch to investing in North Carolina is not yet complete. There is the matter of the state Senate where borrowing is frowned upon. Senate Republicans have united behind a pay-as-you-go plan for major construction. It will save the state borrowing costs, but it won’t generate enough to move the state forward or keep the state’s infrastructure from slipping backward.
There’s no need for cutting back on borrowing. North Carolina has a triple-A bond rating. According to Moody’s rating service, North Carolina’s debt service as a share of state government spending was 3.7 percent in 2014, well below the 4.6 median for other states with triple-A ratings. Meanwhile, the current general fund debt is projected to drop by nearly $2 billion over the next five years from to $3.6 billion. There is plenty of borrowing capacity for the proposed bond package.
With interest rates low and the public ready to support more investment, the Senate should follow the wisdom of the House plan. It’s not irresponsible borrowing. It’s responsible investment.
TRIANGLE ITEMS IN BOND PROPOSAL
▪ $85 million for a Department of Agriculture and N.C. State partnership’s plant sciences building
▪ $105 million for a Department of Agriculture lab facility
▪ $7.5 million to renovate the Taylor Building at N.C. Central University
▪ $7.4 million for a residence hall at the N.C. School of Science and Math
▪ $68.8 million to replace a medical education building at UNC-Chapel Hill
▪ $65.1 million for a new engineering building at N.C. State University
▪ $38.2 million for a Highway Patrol training academy in Wake County
▪ $24.3 million for construction at Wake Tech
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