Bond commission could nix some projects

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Mississippi Coliseum

Some communities around Mississippi may be disappointed after the three-member state bond commission meets this summer to consider the $308 million bond bill lawmakers passed.

State Treasurer Lynn Fitch.

State Treasurer Lynn Fitch

“It’ll be our duty to look at these projects (individually) instead of looking at them at them in a lump sum,” state Treasurer Lynn Fitch told Mississippi Today.

Fitch has been among the most strident critics of the bill lawmakers passed in the waning hours of the legislative session, which wrapped up last week.

A letter Fitch sent to Lt. Gov. Tate Reeves and Speaker Philip Gunn sparked a war of words between fellow Republicans Fitch and Reeves and left in limbo the fate of some of the projects detailed in the more than 600-page bill.

Fitch compared the bond bill to a kind of “Christmas-tree-collection of earmarked goodies” that led fiscal conservatives to end the longstanding practice of congressional earmarks when Republicans took control of the U.S. House of Representatives in 2010.

“When the state issues bonds, we’re obligating Mississippi taxpayers both today and tomorrow to pay back that debt. The Legislature should be painstakingly conscientious of every project it approves,” Fitch stated in her letter. “Too many projects in this bill fail to meet even the basic tests for what the state should, or even can, be issuing bonds.”

Specifically, Fitch said she wants clarity on projects she believes might not be eligible for tax-exempt status under Internal Revenue Service rules for government bonds. For example, Fitch points out, the bill includes $100,000 for “Jackson police service,” but does not specify how the money would be used.

“We simply cannot bond to pay salaries and routine operating expenses, as Section 43 (2) relating to the Jackson Police Department, requires. We do not borrow on the taxpayers’ credit card to fund annual, recurring expenses,” Fitch writes.

Although lacking in specifics, the larger ticket items in the bill include $102 million for colleges and universities over two years, $45 million for Ingalls Shipbuilding which operates at the state shipyard, $20 million for the state fairgrounds and Mississippi Coliseum, $16.6 million for the Civil Rights Museum and Museum of Mississippi History, now under construction in Jackson, and $13 million for state building repairs.

The day the session ended, Reeves questioned Fitch’s motivations in sending the letter, including the possibility that it was a salvo for the next statewide election cycle.

“I think that we’re at a time where a lot of folks are looking at running for public office in 2019 and so everybody’s trying to get some attention,” Reeves told reporters April 21.

Fitch told Mississippi Today that she didn’t have much to say in response to Reeves’ statement except that, “I have a job to do and this is what I’m doing.”

Other issues Fitch raises include paying $111 million to cover debt service. She said even if so-called special funds are swept into the general fund, the most her office could put towards debt service is $80 million, leaving a $31 million shortfall requiring either a deficit appropriation or dipping into the state’s rainy-day fund.

Lt. Gov. Tate Reeves

Lt. Gov. Tate Reeves

Reeves told the Sun-Herald Thursday that pushing off issuing of some bonds until next year might allay some of Fitch’s concerns.

“When I was state treasurer, our bond commission, much to the dismay of the Democrats in the House of Representatives at the time, chose not to issue bonds the Legislature had approved. If that’s what the bond commission chooses to do, that’s certainly their prerogative and under their purview,” Reeves said last week.

Fitch added that she would get input from the state’s financial adviser, bond counsel and some recipients of bond proceeds and share the information with fellow bond commissioners. The state bond commission consists of the state treasurer, governor and attorney general; no meeting date has been scheduled.

Gov. Bryant’s communications office did not immediately respond to requests for comment.

Through a statement to Mississippi Today, Attorney General Jim Hood said: “I am sympathetic to the Treasurer’s points and will fulfill my duty as a member of the bond commission to approve only those bonds which are both legal and prudent.”

Contributing: Adam Ganucheau

 

 

  • redcreek

    That Tater Tot is going to be a great gov. Speakum out of both sides of mouth, all of time. Principles? What me worry?

  • Charles Pearce

    Right on, Treasurer Fitch. Government officials should be very careful on the projects they choose — especially decisions about furnishing and decorating offices.