DALLAS — For the first time since it became a state in 1912, Arizona could lift its constitutional debt limit from the original $350,000 — an amount so small that the state issues no general obligation bonds — to $3.9 billion under a measure in the Legislature.

The existing limit does not mean the state does not issue debt. It currently carries a debt load of $4.3 billion in the form of revenue and lease-purchase bonds, and the sponsor of the legislation is hoping to reduce that burden.

Arizona courts have held that the limitation on GO debt does not apply to bonds and other instruments that are repayable only from specifically designated sources of money.

Under this interpretation, the state may borrow money for state highways payable from gasoline taxes, university buildings payable from tuition, fee, and rental income, and other projects as long as the debt is not backed by general state ­revenue.

Senate Concurrent Resolution 1060, introduced by Senate President Bob Burns, R-Peoria, would raise the debt limit to 5% of net assessed property value.

Under current assessments, the 5% cap would come to $3.9 billion, an amount that is actually lower than the current debt.

“What I am trying to accomplish is to put a cap on state debt, basically creating a limit for future debt,” Burns said in a recent debate on the issue.

Calling debt a “silent budget-killer,” he said he aims to end “gimmicks” that have allowed previous legislatures to do an end-run around the state constitution.

“Accounting gimmicks include the delay of payments to education of almost $1 billion and the sale-leaseback of our state’s buildings,” Burns said, though the state could continue to issue such debt.

He said debt service for the 2012 budget will come to $300 million, limiting appropriations for ongoing government expenses.

In January, Arizona issued $735 million of certificates of participation for the sale-leaseback of state buildings. For the first time, the proceeds of a debt offering were used to cover operations of the state at a time when it was facing a $3.6 billion budget deficit.

To help cover a $1.6 billion shortfall in the fiscal year beginning July 1, lawmakers approved a three-year sales tax increase that requires voter approval in May.

If voters do not approve the tax hike, lawmakers will be forced to make even deeper cuts in spending.

SCR 1060, which has already passed the Senate and is under consideration in the House, would exempt state universities’ debt from the cap.

The new legislation would not open the coffers for GOs because each new bond would have to be backed by revenue from sources other than the general fund.

If passed and signed by Republican Gov. Jan Brewer, the measure would require voter approval to become a constitutional amendment. Brewer has not expressed an opinion on the bill.

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