CHICAGO — A proposed $1.4 billion two-year capital budget, mostly financed with bonds, would create or maintain 30,000 jobs and drive much-needed economic development at the local level, Wisconsin Gov. Jim Doyle said yesterday, pushing for legislative support for the plan.
“This is not the time to pull back on investing in worthwhile state building projects that create jobs and help fuel local economies,” Doyle said in a statement. “The state building program provides a great opportunity for us to fund needed state projects in ways that are energy efficient and environmentally friendly while creating jobs. We are moving our state forward in areas like science, engineering, and green technology, and building on the recovery effort at the same time.”
The State Building Commission approved the plan at a meeting Wednesday, sending it to the Legislature’s Joint Finance Committee for consideration with the governor’s proposed $62.7 billion operating budget for the next biennium that begins July 1.
The capital budget relies on a total of $1.2 billion of general obligation borrowing. About $145.7 million would come from previously authorized borrowing while the remainder represents a new authorization. About $485 million of the GOs would be supported by general fund revenues, while the rest would carry the state’s full faith and credit pledge but be repaid with program-related revenues or segregated revenues, said capital finance director Frank Hoadley.
The capital budget borrowing is separate from $1.5 billion of bonding authority, including $778 million of GO borrowing and $720 million of revenue-backed borrowing in the operating budget. The operating budget does already include a line item to cover debt service on bonding for the capital budget. The level of bonding in both budgets “is in line with the general trend of state borrowing” in recent years, Hoadley said.
The capital finance office has not yet laid out its specific borrowing plans for the next fiscal year. Hoadley expects to complete several financings in the current fiscal year, including a roughly $105 million new-money GO issue that was previously authorized by the Building Commission and would be competitively sold this spring.
He will seek Building Commission authorization later this month for a roughly $200 million transportation revenue new-money deal and is watching for GO, clean water, and transportation refunding opportunities.
The capital budget provides funding for the University of Wisconsin at Milwaukee’s six-year, $240 million expansion, which includes plans for new buildings that would house a new School of Freshwater Sciences college and engineering and public health colleges.
The budget includes funding for the $100 million Bioenergy Research Center at the University of Wisconsin’s flagship Madison campus and support for other university projects. The Bradley Center, home of the National Basketball Association’s Milwaukee Bucks, would receive $5 million over 10 years to help cover the costs of maintenance projects.
Republicans have criticized the package as too costly and too reliant on bonding, given the state’s dwindling revenues and budget deficit. Democrats control the Senate and Assembly. The Democratic governor has proposed eliminating a nearly $6 billion deficit through spending cuts, federal stimulus dollars, and a series of tax and fee increases.
Wisconsin’s GO ratings are AA from Standard & Poor’s, AA-minus from Fitch Ratings, and Aa3 with a negative outlook from Moody’s Investors Service.