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Bond Commission Gets Close To Malloy’s Self-Imposed Cap

by | Sep 23, 2015 11:53am () Comments | Commenting has expired | Share
Posted to: Business, Economic Development, State Budget, Taxes, State Capitol, East Hartford, Manchester, Meriden, Middletown, New Haven, Stamford, Trumbull

CTNJ file photo The state Bond Commission is poised to put another $93.7 million on the state credit card next week when it meets to approve a number of projects. The borrowing will bring it within $8.7 million of Gov. Dannel P. Malloy’s self-imposed, $2.5 billion bond cap for the year.

Malloy told the three credit rating agencies in February that he’s increasing the amount of annual borrowing the state plans to do this calendar year to $2.5 billion. Over the past two years Malloy, who controls the Bond Commission’s agenda, set a “soft” $1.8 billion bonding cap.  He exceeded that cap last year by about $170 million.

In March, Malloy told Republican lawmakers that setting a $2.5 billion cap doesn’t mean the state won’t exceed that amount if it’s necessary. There are still two Bond Commission meetings scheduled before the end of the year.

Sen. Scott Frantz, R-Greenwich, said Wednesday that the state continues to borrow at “too fast a rate.” He said he gets that interest rates are low, but the state still has to pay back the principal on these bonds.

He said every year, for the last eight years, the amount of borrowing the state does continues to increase and at some point that money will have to be paid back. That means a larger portion of the general operating budget will have to go toward debt service and less money will be available to fund services.

“It’s hard to cut back on borrowing,” Frantz said.

If the state borrows $2.5 billion, it will be the most money the state has ever borrowed in a single year. The 10-member commission headed by Malloy will meet Tuesday, Sept. 29 to approve the borrowing.

As part of its agenda next Tuesday, the Bond Commission is expected to award $7 million for the purchase of more buses to expand CTfastrak service to East Hartford and Manchester. The buses would use the High Occupancy Vehicle (HOV) lanes on I-84 east of the Connecticut River. The route will be an extension of the 9.4-mile dedicated busway between Hartford and New Britain.

The state also will loan $1 million to MC Credit Partners LP to help them relocate from New York to Stamford and create 21 jobs. According to the Bond Commission agenda, the loan will have a 2 percent interest rate for 10 years and the company will be eligible to have $250,000 of the loan forgiven if it creates 21 jobs and retains them for two years. The company will have another $250,000 forgiven if it creates five additional jobs and retains them for two years.

The state also will loan Vermillion Inc. of Austin, Texas $2 million to move to Trumbull. The loan will have an interest rate of 2 percent for 10 years. And the company will have $2 million of it forgiven if it creates 40 jobs and retains them for two years. The company will be eligible for an additional $1 million loan upon FDA approval of its new product and a further $1 million loan when it achieves annual revenue targets.

Malloy’s transportation initiative will receive $17.5 million for various bike and pedestrian trail connections, including a dedicated, protected cycle track from downtown New Haven to the residential neighborhoods to the west of the city and Southern Connecticut State University.

There’s also $67,000 for security improvements at the Connecticut Juvenile Training School, $514,000 for improvements to Rentschler Field in East Hartford, $37 million to renovate Lafayette Hall at Housatonic Community College, $700,000 to fund additional costs associated with the state’s share of the development of a parking garage near the rail station in Meriden, and $300,000 for the Tennis Foundation of Connecticut to help design improvements to the Connecticut Tennis Center in New Haven.

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Comments

(12) Archived Comments

posted by: jackelbeen | September 23, 2015  4:28pm

WoW! Connecticut is a money gving machine.Taking on more debt to do it.Oh wait the money is to cheap to pass up say porcupine.Im out of Connecticut.

posted by: SocialButterfly | September 23, 2015  7:58pm

What qualifies Malloy to set a $2.5 billion dollar spending cap   “that he will surpass as the perpetUal spender?”

posted by: art vandelay | September 23, 2015  10:38pm

art vandelay

I hope the two Republicans appointed to the Commission vote no on every expenditure.

posted by: oldtimer | September 23, 2015  11:28pm

Over-borrow, over-tax, over-spend… Looks like it’s over for CT. Somehow though, I get the feeling this is the fault of GE paying only $250 in taxes.

posted by: art vandelay | September 24, 2015  3:01am

art vandelay

@Oldtimer,
It’s also the fault of corporate executives not paying their “fair share”.

posted by: MyOpinion | September 24, 2015  8:27am

Typical Democratic Governor. Borrow, borrow, borrow, then raise taxes to pay it back.

posted by: Independent Mind | September 24, 2015  8:41am

This borrow, spend, tax, borrow, spend, tax bull crap needs to stop!  It’s lunacy at its finest in the the governor’s mansion.  He bankrupted Stamford, he is bankrupting Connecticut!

posted by: SocialButterfly | September 24, 2015  1:17pm

@art vandelay: Politijoe now has you talking his daily message: “it’s the fault of corporate executives not paying their"fair share.” You finally capitulated to his PJ’s daily power of persuasion over you and eended up in a personal role “as being a softy in your convictions.”.

posted by: Janster57 | September 24, 2015  1:53pm

Watching CT government borrow, tax, and spend is not for the faint of heart.

posted by: Janster57 | September 24, 2015  6:28pm

But for CT taxpayers, it is at the heart of faint. Am I clever or what?

posted by: art vandelay | September 25, 2015  2:12am

art vandelay

@Social Butterfly,
Could you not detect a note of sarcasm?

posted by: SocialButterfly | September 25, 2015  11:09am

@art vandelay:  It comes with the editorial territory that presents itself for certain folks. .

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