Enid News and Eagle Editorial - Bond issue for roads is not a good idea for state

Enid News & Eagle Editorial
Bond issue for roads is not a good idea for state
Published: May 04, 2008

Do Oklahoma’s roads need work?

It doesn’t take much time or thought to come up with the answer to that question. Yes, there is no doubt our roads need work — lots of it.

However, the big question — and one that can’t be answered so easily — is how do we pay for the work? State lawmakers have approved a standstill budget. That means most agencies received the same amount of funding for the next fiscal year as they did for the current fiscal year

Lawmakers have been struggling with the question of paying for needed work, and the talk around the Capitol recently was on a $500 million bond issue for road repairs and other projects.

Two lawmakers — Sen. Johnny Crutchfield, D-Ardmore, Senate appropriations co-chairman, and Rep. Guy Liebmann, R-Oklahoma City — are the main ones talking bond issue. Crutchfield is the main promoter of the $500 million bond issue for roads and other projects. Liebmann also has a list of $443 million worth of projects.

That all sounds well and good. The state sells the bonds and gets the work it needs done. However, we also need to consider the debt service. State Sen. Patrick Anderson, R-Enid, cautioned his fellow lawmakers in a letter to be careful. He said the current market conditions are not what the state needs, and it would be “poor financial planning” to have such a large bond issue.

We have to agree.

Consider Anderson’s evidence. Recently, the state had to refinance $400 million in student loan bonds. The state has been paying up to 16 percent interest on some of those bonds. That figure is unacceptable.

Also, Senate Co-President Pro Tem Glenn Coffee, R-Oklahoma City, said paying debt service on any bonds could be a problem if the state had another tight budget next year.

The key thing to consider is something no one can answer right now. How much will state revenue collections grow, if at all in the next year?

As we said, the state budget for next fiscal year is a standstill budget. If we end up with a standstill budget again in 2009, how could the state manage to make more debt service payments on more bonds while providing adequate funding for schools, corrections and health services?

As much as it hurts us to say, a bond issue isn’t the way to go at this time. Fixing our roads is important, and something we have advocated time and again. However, there are too many unknowns right now to jump into a huge bond issue.