Like the person who proclaims they can’t be out of money, because they still have checks left, or the couple that believes they can pay off their credit card balance by only making the minimum payment every month, our state legislators are at it again.  Despite a $4.6 billion budget deficit, the first major finance bill to pass both the House and Senate this year is a large pork laden bonding bill. 

The Senate bonding bill weighs in at a whopping $329 million while the House version is a “slimmed down” $248 million.  Both bills greatly exceed what the State Management and Budget Office pegs as the maximum remaining bonding capacity in order to keep the State within a 3 percent debt service payment limit.

Under normal legislative procedures major bonding bills (public construction projects financed with state general obligation bonds) are dealt with in the even year sessions.  But never wanting to miss an opportunity to spend the State further into debt, DFL majorities in both the House and Senate want to use the recession as an excuse to create “public works” jobs at taxpayers’ expense.

To the passive observer this may sound like a reasonable or even a good idea, however, there are two major problems.

First, the legislature has been in Session for three months and has failed to produce any reasonable solution to the State’s huge budget problem.  Most of their time during the last month has been spent “demagogue-ing” Gov. Pawlenty’s budget proposal while they languish in endless committee hearings which produce no meaningful progress toward a balanced budget solution.  House and Senate leadership can’t seem to agree on anything except the idea of imposing billions of dollars in new taxes and hundreds of millions in new debt. 

This irresponsible behavior has them exceeding their own self imposed debt limit and because the state has to pay off this debt, it will make it harder to balance future budgets. 

Second, legislators have turned a deaf ear to their very own limits on the creation of new debt.  For 30 years the Legislature has imposed a debt limit of 3 percent of general fund spending.  Forewarned by the State Management and Budget Office that passage of any bonding bill in 2009 would push the State beyond the 3.0% limit hasn’t fazed DFL legislators on their quest to add to the State’s $4.7 billion “credit card” debt. 

With this amount of debt and falling state revenues, legislators are jeopardizing the State’s bond rating.  As reported last week in the Capitol Report by Britt Robson, “An underperforming state economy, a tax system producing volatile revenues and a stubborn penchant for using one-time monies to pay for ongoing budget expenditures…Minnesota could receive a lower credit rating on its general obligation bonds.” 

The result if Minnesota’s credit rating is downgraded would be higher interest payments in the future, costing taxpayers more to borrow money.

What is it that the Legislature considers so critical that they would exceed their own debt limit and risk the State’s credit rating being downgraded?  Urgent and necessary infrastructure projects, right?  WRONG!

The Senate version of the bonding bill contains financing for such necessary projects as $11 million for gorilla and polar bear exhibits at the Como Zoo, $6.5 million for a women’s hockey exposition center and $4 million to expand the volleyball facility in Rochester.

While the House bill is $80 million less than the Senate bill, Chairwoman Rep. Housman stated:  “I would have preferred a much larger bill.”  With the House and Senate set to iron out the differences in the two bills in order to send the bloated mess to the Governor one should recall the words from the Governor’s line-item veto message from last April.  “I am very disappointed that the legislature ignored an understanding between my office and legislative leadership and my repeated warnings to abide by the state’s longstanding debt limit.  It is irresponsible to exceed the “credit card limit” that has been maintained by governors and legislators from both parties for the past 30 years.” 

There they go again!  

This column originally appeared in the St. Paul Legal Ledger Capitol Report.