From completing the expansion of the state capitol to building new prison beds, as much as $4 billion of tax-exempt bonds are expected to figure in the budget now being drafted by Texas lawmakers.
The biggest part of that would call for a November election at which voters would be asked to approve $1.1 billion of double-A rated general obligation bonds to pay for 30,000 new prison beds.
The Texas Senate last week approved a proposal and sent it to the House, where it is expected to be passed and signed by Gov. Ann Richards before the new fiscal year begins Sept. 1. However, it is not yet clear how large the final package will be since a House subcommittee cut the proposed issue by nearly two-thirds.
But lobbyists say the state is likely to use bonds for many onetime projects in a move to close a projected $4.8 billion budget shortfall during the next two-year fiscal cycle.
Many smaller projects are also being suggested for Texas, which has the lowest debt of the country's the 10 largest states.
State Comptroller John Sharp calls for the issuance of bonds to complete the expansion of the state capitol in Austin in a move expected to save the general fund $35.2 million.
Also, an estimated $19 million in repairs needed by the state's Department of Mental Health and Mental Retardation would be paid for with bonds.
Before the oil economy lost its sap in the mid-1980s, Texas paid for such things from the general fund.
"Texas always was a pay-as-you-go state, but it is making the transition to using bonds for more things," one lobbyist said. "It may sound like a good idea now, but [lawmakers] may think twice when they realize they'll be getting the bill for the next 30 years to save some now."
