With the drought continuing to affect Texas families, water infrastructure is on everyone’s minds in the Lone Star State. Unfortunately, the state’s constitutional amendment election Nov. 8 creates an infrastructure of $6 billion in permanent debt from under which voters will never be relieved — by design.
Make no mistake, issuing bonds is a viable way to fund the infrastructure needed to improve Texas’ access to water. Indeed, if the legislature had simply proposed the allowance of $6 billion in new water bonding authority to the Texas Water Development Board, it’s likely we wouldn’t be opposing the amendment Proposition 2.
But the legislature did a very curious thing: they made this $6 billion issuance of bonds “evergreen” – meaning that the TWDB will be allowed to keep issuing the debt into perpetuity. Usually, bonds are issued as a one-time debt obligation. Once the bond is issued, the issuing authority is over. Any new issuance of debt requires making the case to the taxpayers. But not under this proposition.
Under this this so-called “evergreen” arrangement, the unelected TWDB would be allowed to issue new bonds when the old ones are paid off. In other words, Proposition 2 would create a permanent debt load of $6 billion.
That’s not the kind of infrastructure Texans should be building.
Texas’ constitution shouldn’t foist permanent debt on future generations. If the state needs to issue $6 billion in bonds to provide for needed water infrastructure, let’s have that debate, issue the bonds, do the work and pay them off. Future needs, and future debt to address them, are best handled at future times. Giving bonding authority into perpetuity isn’t a viable solution.
Proposition 2 would no doubt initially do some very good things, but then the accountability and transparency would fade behind a curtain of the newly empowered, permanently debt-issuing bureaucracy.
The Texas Public Policy Foundation also opposes Prop 2. Their fiscal policy expert Talmadge Heflin recently told the Fort Worth Star Telegram recently that taxpayers need to be kept in the fiscal “loop” on matters of debt.
That loop necessarily includes limiting how long government can keep taxpayers in debt. And forever is a very long time.