A proposal to issue bonds to finance college capital improvement projects that failed to make it through the legislature last year has re-surfaced this year, after a bit of tweaking by the sponsor.
Rep. Chris Kelly (D-Columbia) sees advantages to resurrecting his idea.
“The membership of the General Assembly has had more time to become aware of and comfortable with the idea,” says Kelly.
Kelly proposes that the state issue $800 million in bonds to finance construction of medical, technical and science buildings on each state college campus in Missouri (HJR 77). Kelly understands targeting the money for those particular purposes to each campus has political appeal in the General Assembly.
“I think it is politically helpful, but we didn’t pick them for that reason,” Kelly says, explaining that the Coordinating Board for Higher Education chose the projects.
Kelly says the money is there to pay for the bonds. He points out that the state makes the final $39 million payment on $600 million in capital improvement bonds issued in 1982. Kelly proposed a $700 million dollar bond package last session. It passed the House, but failed to clear the Senate. Governor Nixon even considered calling a special session to consider the idea.
The timing is important. Interest rates are low, which would allow the state to issue more bonds at less cost. The federal economic stimulus package provides incentives for states to issue bonds, offering to pay up to 35% of the interest. Kelly estimates the bonds could be paid off in 20, possibly 25, years.
If the legislature approves the issue, it goes to a vote of the people.
“Must be voted on by the citizens of Missouri,” Kelly says. “And they have a right to determine the use of their own tax dollars.”
Kelly also touts the bond package as economic development. He says each of the projects financed would create construction jobs.