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Legislative News and Views - Rep. Bob Vogel (R)

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A closer look at proposed statewide bonding projects

Tuesday, January 5, 2016

To the editor,

 

The House Capital Investment Committee, of which I am a member, has wrapped up its series of tours across the state to visit sites of proposed bonding projects.

 

All together, we spent 13 days on the road over the course of five separate trips and made more than 60 stops. These expected proposals add up to over $4 billion.

 

Bonding bills traditionally are done in even-numbered years, so it will be one of the top issues when the upcoming session begins March 8. I see two key overall decisions which will have to be made. First, how much should the bonding total? And, secondly, which projects then get approved?

 

Determining the amount of state bonding is now done using a percentage of expected personal income of Minnesota and then applying a factor to arrive at a total amount of all bonds that can be outstanding at one time. Although that principle is a sound guide, it only takes into account the total amount of debt that can be outstanding, but does not look at how much it cost taxpayers to make the payments on the bonds.

 

My hope is to prompt a discussion using both the amount of debt outstanding as is currently done, and also add a test to address the dollars needed to service the debt as well. An analogy would be someone who might qualify to spend X dollars to purchase a new home (amount they “qualify for”) but then also have the foresight to be prudent and consider what they can afford in payments relative to their current and expected income. So whether it’s a prudent consumer, or the State of Minnesota, to be judicious, both the level of debt and the dollars needed to service it need to be carefully defined, so we don’t leave future generations with an excessive payment obligation they can’t afford.

 

Once the amount of debt is determined the second, and equally difficult issue to face, is to decide how the available bonding funds will be apportioned. The bonding committee visited many potential projects yet we really didn't even make a dent in seeing all the infrastructure which exists.

 

In some cases the decision becomes do you fix the leaky roof or replace the building. Beyond that however there are hundreds of “asks” for new projects, some are close to being a necessity, others which are “nice to have” things. The latter don’t rise to the priority of a bridge or dam that could fail, but of course are popular with those who want them. As you can imagine it will make for some very difficult decisions since the current repairs are necessary for safety and use, yet the new projects would also bring quality of life to those who use them.

 

As always I invite any ideas you care to share, either on bonding or anything else which affects you, so I can be as effective as possible in representing the people of our district and the State.

 

Sincerely,

Rep. Bob Vogel

 

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