OKLAHOMA CITY — Oklahoma's bond debt could be limited but still allow enough borrowing power to repair a crumbling Capitol building and take on other public projects under an overhauled bill that passed a Senate committee Wednesday.
The measure would limit Oklahoma's debt indirectly by capping the state's debt-service payments — the interest paid on state-issued bonds. The Senate Appropriations Committee sent the bill to the full Senate on a 17-2 vote.
"If you get this cap in place, it's a banner saying this is the limitation that has been soundly established and you can feel comfortable getting up to this limit," the bill's sponsor, Sen. Josh Brecheen, R-Coalgate, told The Associated Press after the vote. "It's not saying no new debt — it's saying debt with limitation."
Brecheen's bill is intended to replace a debt-limit bill by House Speaker T.W. Shannon that would have limited the state's bond level to 28 percent of general revenue, or $1.5 billion this year.
The bill approved Wednesday limits the state's interest payments at 4.5 percent of general revenue. Under it, the amount of money that can be borrowed can vary based on interest rates. Current interest payments come to less than $200 million.
The proposals are also different in that Brecheen's leaves enough room for bond issues to cover Capitol renovations, a pop culture museum in Tulsa and the still-unfinished American Indian Cultural Center and Museum in Oklahoma City, State Bond Advisor Jim Joseph has said. The Capitol renovation, pushed by Gov. Mary Fallin at the beginning of the session, could cost an estimated $150 million alone.
"It's purposely there to help us bridge this philosophical divide between should we or should we not issue new bond debt," Brecheen said. "That is the critical element with having a cap."
Sen. Brian Crain, R-Tulsa and one of the two opponents on the committee, questioned whether the debt limit was too inflexible. Brecheen's bill allows the legislature to override the limit in the event of an emergency with a two-thirds majority in both chambers.
"Can you tell me the last time two-thirds of both chambers of the legislature agreed on a bond issue?" Crain asked, prompting laughter from around the room.