- Tap $241 million from the state's $2 billion reserves;
- $240 million will be derived from additional borrowing to take advantage of the state's AAA bond rating and historically-low interest rates;
- $50 million will come from an accelerated distribution from the Next Generation Trust Fund;
- Refinancing existing bonds will free up $6.5 million in annual savings through 2029; and
- $450 million will come from $150 million in appropriations Pence will recommend for second, third and fourth fiscal years.
Tuesday, October 13, 2015
Pence Plans $1 Billion Roads Program Without Raising Taxes
It looks like smoke and mirrors, but Gov. Mike Pence has developed a plan to invest $1 billion in road projects over the next four years by dipping into the state's reserves and refinancing existing debt. To accomplish his spending plan, he will do the following:
It looks like there's a few ifs involved in this financing scheme. Smaller than anticipated state revenues, for example, from a downturn in the economy could upset the apple cart. With automobiles continuing to become more fuel efficient, the state is already fighting a losing battle in raising enough revenues from gasoline taxes to keep pace with highway and bridge demands.