Treasurer Lynn Fitch credits work of the three-member Mississippi Bond Commission with saving the state $32 million during the upcoming, cash-strapped fiscal year.
Both Fitch and Gov. Phil Bryant announced the savings via social media. In a tweet Thursday afternoon, the Republican governor said, "In New York, we just restructured state bonds to save taxpayers $30 million. We will continue to prudently manage taxpayer dollars."
The third member of the Bond Commission, Democratic Attorney General Jim Hood, did not go on the New York trip.
A news release from the treasurer said savings of $34 million in total, but $32 million for the upcoming fiscal year, was accomplished by refunding and restructuring nearly $450 million in outstanding state bonds.
She said, "The Bond Commission pays close attention to the financial markets so we can take advantage of favorable market conditions to save Mississippians money. Today's refunding not only eliminates the need for a deficit appropriation for debt service in FY 2018, but also saves taxpayers millions throughout the remaining life of the bonds."
During the 2017 session, the Legislature appropriated $384.7 million to pay the state's annual bonded indebtedness -- $7.3 million less than was provided in the 2016 session. Without the restructuring announced Thursday, Fitch said the Legislature would have had to make a deficit appropriation during the upcoming fiscal year, which begins July 1, to pay the state's debt.
Lt. Gov. Tate Reeves, who previously served as treasurer, has often complained that under Fitch the Treasurer's office has asked for bigger deficit appropriations than were ultimately needed.
Fitch has credited refinancing such as was announced Thursday with not only holding down the state's annual payments on the debt, but also limiting the amount of deficit appropriations needed from the Legislature. She said in her first term $69 million was saved through restructuring efforts.
The $384.7 million appropriated for the debt during the 2017 session represents 6.4 percent of the total state-support budget.
The state's total bonded indebtedness is $4.3 billion.
In New York, Bryant and Fitch met with the three influential credit rating agencies that give in essence credit scores for various entities, including governments. The credit score impacts the interest paid on the bonds issued to finance long-term projects, such as expansions and renovations on university and community college campuses.
The credit rating agencies have given Mississippi negative outlooks over the past year, citing sluggish revenue projections and a lack of economic progress.
The current ratings are:
* Fitch: AA/Stable.
* Standard & Poor: AA/Negative.
* Moody's: Aa2/Negative.
During the meeting with the rating agencies, Fitch said she and the governor updated the companies on the FORTIFY Act proposed by the governor and passed during last week's legislative special session.
Bryant said the Financial and Operational Responses that Invigorate Future Years Act would address some of the concerns addressed by the rating agencies with Mississippi's budgeting process. While the Legislature did not pass the entire Bryant FORTIFY proposal, it did approve most of it, including increasing the capped maximum for the Working Cash Stabilization Fund, commonly known as the rainy day fund, from 7.5 percent of the current year's general fund appropriation to 10 percent.
The Legislature has been dealing with sluggish revenue collections for more than a year. The $6.04 billion budget passed by the 2017 session is about $330 million less than the budget passed in 2016.
As a result of the sluggish revenue collections, there have been cuts in numerous programs, including layoffs or not filling vacant positions in multiple state agencies.
