Missouri House approves $700 million university bond issue

Friday, April 17, 2009 | 12:01 a.m. CDT; updated 10:11 a.m. CDT, Friday, April 17, 2009

JEFFERSON CITY — With a 131-28 vote Thursday, state representatives pushed through a bond issue that would allocate $700 million for facilities associated with Missouri's public universities and colleges.

Under the proposal sponsored by Rep. Chris Kelly, MU would receive $81 million to help fund construction projects originally intended to receive money from the sale of the state loan authority's assets.

Kelly, D-Columbia, said the proposal takes advantage of low interest rates and would help create jobs in the state.

In February, Gov. Jay Nixon suspended $51.2 million of funding for MU, including nearly $31.2 million for the construction of the Ellis Fischel Cancer Center. Nixon said the Missouri Higher Education Loan Authority was in too difficult a financial situation to complete the sale.

The House proposal now moves to the Senate for consideration. If approved there, Missouri voters would have the final say on whether to amend the state constitution to put the bond issue into action.

Representatives opposing the resolution voiced concerns that the General Assembly is becoming too much like Congress by issuing checks and going into debt during an economic recession.

Speaker Pro Tem Bryan Pratt, R-Blue Springs, said that despite low interest rates and potential job creation, the time is not right for increasing state debt.

"Interest rates have been low for a long time, and just because I see a nice sweater on sale doesn't mean I should buy it," he said.

Kelly argued that university improvements would be for one-time expenditures rather than ongoing yearly needs, as Congress is apt to approve.

"Gentlemen, I believe that the unbalanced federal budget is akin to treason," he told lawmakers. "I cannot imagine a greater insult than to be called a congressman."

If approved by voters, the bonds would be issued by the State Board of Fund Commissioners and would mature after 25 years.

Speaking in favor of the resolution, Rep. Jeff Roorda, D-Barnhart, said the state broke a covenant with Missouri residents when it failed to deliver on its promise to fund university construction projects using loan authority assets.

"We wouldn't be here today indebting the state for $700 million if it weren't for a wayward scheme of asset sales," he said.

The resolution won approval Thursday even as the House Budget Committee considered using federal budget stabilization money to reinstate about $101.5 million in funds for the university construction projects that were halted earlier this year.

Those projects include partial funding for renovations to the State Historical Society of Missouri and a swine research facility in Callaway County.

Missourian reporter Sarah Wire contributed to this report.

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