WASHINGTON -- Virginia's Debt Capacity Advisory Committee, formed to get a better handle on state debt issuance, will hold its first meeting Nov. 21.

The committee was established by executive order Sept. 18 as an outgrowth of a December 1990 assessment of debt management in Virginia conducted by state finance officials. The panel reflects their consensur that "it is critical the commonwealth begin to more closely monitor, plan, and coordinate the use of its debt resources to ensure high credit ratings in the future.

The first meeting of the committee comes as the market looks more closely at issuers' ability to pay off bonds.

Gov. L. Douglas Wilder has on several occasions expressed the need for Virginia to get better control over bond issuance so the state can maintain its triple-A ratings from Standard & Poor's Corp., Moody's Investors Service, and Fitch Investors Service.

But the state received a jolt earlier in the year when Standard & Poor's assigned a "negative" outlook to the state's debt. Previously, its bond rating had been given a "stable" outlook.

Paul W. Timmreck, the state's finance secretary, will serve as chairman of the panel. Other members include: Eddie N. Moore Jr., Virginia's treasurer; Karen F. Washabau, director of the state's planning and budget department; Walter W. Craigie Jr., managing director of Wheat, First Securities Inc.; and Caspa L. Harris Jr., president of the National Association of College and University Business Officers.

The 1990 debt management assessment noted that Virginia's outstanding debt had increased by 209% from 1980 through 1990, fueled largley in recent years by tax-supported agency and authority debt.

According to the assessment, the state's process for authorizing bonds had become "fragmented" and "piecemeal," with boards and authorities issuing debt "without consideration of the impact on overall commonwealth debt levels."

Armed with the debt management assessment, Gov. L. Douglas Wilder asked the General Assembly to create a debt advisory panel, but lawmakers adjourned without passing the necessary legislation.

Consequently, Gov. Wilder signed Executive Order Number 38, which established the committee and charged it with submitting to the governor an annual report estimating the amount of tax-supported debt Virginia prudently can issue.

The board will be similar to Maryland's Capital Debt Affordability Committee, which was established in 1978 amid concerns about a sharp rise in bonding to fund public schools.

Ratings agency analysts generally praise the move.

"I think it's a prudent move to set up such a committee," said Parry Young, a Standard & Poor's senir vice president, in a comment typical of those expressed yesterday by rating officials. "The commonwealth at the current time has low direct debt. But it's wise to keep an eye on all the other agencies that are authorized to issue debt."

Gov. Wilders executive order is to remain in effect until June 30, 1994, unless amended or terminated by another executive order.

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