Treasurer Tate Reeves: ‘No New Bonds in 2008’

Mississippi state Treasurer Tate Reeves released the following fiscal update today. Reprinted verbatim:

Jackson, Miss: (January 17, 2008) - State Treasurer Tate Reeves spoke to the Joint Legislative Budget Committee and other members of the House and Senate today at the annual fiscal briefing.  In Reeves briefing, he made a recommendation that the Legislature withhold from authorizing the issuance of any new bonds in the 2008 session. According to Reeves, since 2003 the states debt has begun to level off, and in order for this positive trend to continue the Legislature must reduce the authorization of new bonds. ғWe have made great progress in the last few years reducing the overall debt burden on Mississippi taxpayers Reeves said. ԓGiven the budget challenges that face the Legislature this year, the only fiscally prudent approach to bonds is to forego the pressure and not authorize any new debt.

In todays fiscal briefing, Reeves also reminded the members of the Legislature of the importance to remain in control of the stateҒs overall debt burden.Reeves pointed out that in 1990, Mississippi had outstanding debt of $589 million which is approximately 16 percent of the states constitutional debt limit. By 2004, that had increased to over $3 billion which is more than 36 percent of the states debt limit. Reeves said that over the last four years, the total debt burden on the Mississippi taxpayers has stayed the same, and the debt as a percentage of the constitutional limit has declined to 25 percent.

Reeves also stated that debt service at its peak comprised nearly 10 percent of the states total state appropriations. Currently, it is estimated to be 6.75 percent of the 2008 budget. According to Reeves, if the state continues to reduce the states debt burden there will be more money in the state budget for MississippiҒs priorities such as education and economic development.
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Every dollar we spend on principal and interest is a dollar we canӒt spend on public education. Every dollar we spend on principal and interest is a dollar we cant spend on public safety. And the nearly $400 million we spend on principal and interest this year is $400 million that we cant spend on the other vital services that state government provides.Ԡ