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Washington State Legislature
Wed February 23, 2011
Lawmakers consider ideas to limit rising debt
Washington's total debt load is twice the national median – and one of the highest in the nation. That's the warning from the State Treasurer. Now lawmakers are considering two proposals to cap how much Washington can borrow for capital construction projects.
Consider this. Before Washington puts a dime towards schools or health care in the next two-year budget, it must make its debt payment.
Think of it as the state's mortgage for decades of borrowing to build infrastructure like K-12 and higher education buildings. In the next two years, that payment is nearly $2 billion.
"That's too much," says Democratic State Senator Derek Kilmer.
Kilmer wants to cap the state's debt limit at seven percent. But allow a nine percent debt load during bad economic times in order to help jump start the economy:
"Unfortunately you have a time like now where you're very constrained in terms of how much investment you can make even though you have a lot of out-of-work construction workers and it's cheap to build."
This counter-cyclical approach to borrowing has bipartisan support. But it would require a constitutional amendment.
And some critics are skeptical it would work as envisioned. Washington's State Treasurer James McIntire says lawmakers need to do something to rein-in the debt.
State Budget Crisis