Published: Tuesday, April 7, 2009
Huge statewide school bond is pitched
$3 billion would build schools, employ thousands, but many see pitfalls
OLYMPIA -- A Snohomish lawmaker said Monday his proposed $3 billion bond for school construction will create thousands of needed jobs around the state.
The state's treasurer warned it will push Washington's debt to a dangerously high level that may affect its future financial health.
The measure by Rep. Hans Dunshee would fund improvements in all school districts, community colleges and four-year universities in the state. It also would pay for making public buildings more energy efficient.
Up to 90,000 jobs can be preserved or created in the next two years if the Legislature puts it on the November ballot and it passes, he said Monday.
Calling it the Washington Works Act, he likens its purpose to that of the Works Progress Administration, or WPA, the national program created during the Depression in 1935 to employ those out of work.
"Let's do what the WPA did, let's put people to work," said Dunshee, chairman of the Capital Budget Committee.
State Treasurer James McIntire warned Monday the bond is too large and could harm Washington's credit rating.
"We need to live within our means," he said in a prepared statement. "Though we clearly have significant capital needs at our schools and universities, borrowed money is a limited resource that should be managed carefully."
The state has a debt limit set by the constitution. It will nearly reach that maximum if either the House or Senate capital budget proposal is approved, McIntire said.
If voters approve the proposal, the debt would be below the constitutional limit. But the payments still come from state coffers and will be too much, he said.
"It would threaten our credit rating and would affect the rest of our investments in transportation and public infrastructure," he said.
Dunshee's plan calls for selling $3 billion in general obligation bonds to be repaid over 20 years.
Of the sum, $2.7 billion would go into public schools and colleges for 4,458 projects ranging from removing or sealing asbestos, repairing roofs and replacing old furnaces with newer, energy-efficient systems. Another $300 million would go specifically into retrofitting state buildings with equipment to curb energy use.
Money saved on lower energy bills, about $80 million a year, would cover about a third of the cost of repaying the bonds, Dunshee said.
The bill does not specify how the rest of the repayment would be covered. It could come from a new voter-approved tax or use of existing state revenues, Dunshee said.
Rep. John McCoy, D-Everett, state schools chief Randy Dorn and Edmonds Community College trustee Vaughn Sherman offered their support during Monday's event.
McCoy said schools get needed improvements and the state gets people to work.
"This is a twofer. This is something that needs to be done," he said.
It is unclear how much legislative support will materialize for this idea. Dunshee claimed Monday he had the backing of a majority in his caucus, including House Speaker Frank Chopp, D-Seattle.
Gov. Chris Gregoire has expressed interest in putting some sort of bond measure before voters to stir creation of new jobs. She has not formally endorsed this proposal.
Rep. Norma Smith, R-Clinton, who serves on the Capital Budget Committee, said McIntire's letter answers her questions about the potential harm of additional debt.
"To me it's pretty sobering," she said of the letter.
She still has doubts about the value of a bond at this time.
"It just doesn't make sense at this point that you'd focus on buildings over teachers," she said.
Reporter Jerry Cornfield: 360-352-8623, jcornfield@heraldnet.com.
State school bond
@Breakout text first-line indent:The proposed state bond measure would provide money to all state school districts. Projected amounts for a few area districts:
Edmonds: $39.3 million
Everett: $36.1 million
Mukilteo: $27.7 million
Marysville: $22.7 million
Snohomish: $18.9 million
Lake Stevens: $15 million
Office of Program Research, Washington state Legislature
The state's treasurer warned it will push Washington's debt to a dangerously high level that may affect its future financial health.
The measure by Rep. Hans Dunshee would fund improvements in all school districts, community colleges and four-year universities in the state. It also would pay for making public buildings more energy efficient.
Up to 90,000 jobs can be preserved or created in the next two years if the Legislature puts it on the November ballot and it passes, he said Monday.
Calling it the Washington Works Act, he likens its purpose to that of the Works Progress Administration, or WPA, the national program created during the Depression in 1935 to employ those out of work.
"Let's do what the WPA did, let's put people to work," said Dunshee, chairman of the Capital Budget Committee.
State Treasurer James McIntire warned Monday the bond is too large and could harm Washington's credit rating.
"We need to live within our means," he said in a prepared statement. "Though we clearly have significant capital needs at our schools and universities, borrowed money is a limited resource that should be managed carefully."
The state has a debt limit set by the constitution. It will nearly reach that maximum if either the House or Senate capital budget proposal is approved, McIntire said.
If voters approve the proposal, the debt would be below the constitutional limit. But the payments still come from state coffers and will be too much, he said.
"It would threaten our credit rating and would affect the rest of our investments in transportation and public infrastructure," he said.
Dunshee's plan calls for selling $3 billion in general obligation bonds to be repaid over 20 years.
Of the sum, $2.7 billion would go into public schools and colleges for 4,458 projects ranging from removing or sealing asbestos, repairing roofs and replacing old furnaces with newer, energy-efficient systems. Another $300 million would go specifically into retrofitting state buildings with equipment to curb energy use.
Money saved on lower energy bills, about $80 million a year, would cover about a third of the cost of repaying the bonds, Dunshee said.
The bill does not specify how the rest of the repayment would be covered. It could come from a new voter-approved tax or use of existing state revenues, Dunshee said.
Rep. John McCoy, D-Everett, state schools chief Randy Dorn and Edmonds Community College trustee Vaughn Sherman offered their support during Monday's event.
McCoy said schools get needed improvements and the state gets people to work.
"This is a twofer. This is something that needs to be done," he said.
It is unclear how much legislative support will materialize for this idea. Dunshee claimed Monday he had the backing of a majority in his caucus, including House Speaker Frank Chopp, D-Seattle.
Gov. Chris Gregoire has expressed interest in putting some sort of bond measure before voters to stir creation of new jobs. She has not formally endorsed this proposal.
Rep. Norma Smith, R-Clinton, who serves on the Capital Budget Committee, said McIntire's letter answers her questions about the potential harm of additional debt.
"To me it's pretty sobering," she said of the letter.
She still has doubts about the value of a bond at this time.
"It just doesn't make sense at this point that you'd focus on buildings over teachers," she said.
Reporter Jerry Cornfield: 360-352-8623, jcornfield@heraldnet.com.
State school bond
@Breakout text first-line indent:The proposed state bond measure would provide money to all state school districts. Projected amounts for a few area districts:
Edmonds: $39.3 million
Everett: $36.1 million
Mukilteo: $27.7 million
Marysville: $22.7 million
Snohomish: $18.9 million
Lake Stevens: $15 million
Office of Program Research, Washington state Legislature
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