Governor, legislative leaders support $500 million bond issue

Saturday, January 1st 2005, 4:09 pm

By: News On 6

OKLAHOMA CITY (AP) _ Gov. Brad Henry and legislative leaders from both parties say they support a proposed $500 million bond issue that will pay for capital improvements at every college and university in the state.

State regents and college presidents have agreed on the projects to include in the proposal, but Henry said he hopes the bond issue doesn't get tangled in politics.

``I am very concerned that the bond issue not get caught up in pork-barrel projects,'' Henry said.

Henry is expected to propose the bond issue to the Legislature before the upcoming session begins Feb. 7.

Because the state's higher education leaders agree on the proposal, Senate President Pro Tem Cal Hobson said he sees no need to change it, but added that lawmakers will take a close look at each project.

``From what I've seen so far, it's a very wise package of investments,'' the Lexington Democrat said.

Hobson wants to pass the package in February so architects and engineers can start on the construction, maintenance and renovation projects immediately. Low interest rates provide another incentive to move quickly before rates go up, he said.

But Rep. Tad Jones, R-Claremore, said lawmakers are in no hurry to pass the bond proposal immediately.

``We'll get it done during the session, but we're going to take our time with it and get it right,'' said Jones, who is the new chairman of the Education Subcommittee of the House Appropriations and Budget Committee.

House Speaker-elect Todd Hiett, R-Kellyville, said he would consider how the state would pay for the bond issue and what the return on the investment would be before making a decision.

Henry said proceeds from a new state lottery could pay the cost. Forty-five percent of the net lottery proceeds are designated for higher education.

Debt service on a $500 million bond issue could run $33 million to $35 million a year, said State Bond Adviser Jim Joseph.

The Office of State Finance is projecting $62.3 million will go into the Oklahoma Education Lottery Trust Fund for fiscal year 2006, based on the lottery starting in October 2005.

Henry called it ``the perfect revenue source.''

Henry and Hobson said taxes would not be raised to pay for the bond issue.

The last higher education bond issue was in 1992.