OKLAHOMA CITY (AP) - A plan to authorize a $160 million bond issue to repair Oklahoma’s nearly 100-year-old state Capitol moved closer to final passage Wednesday when it was approved by the powerful House Appropriations and Budget Committee.
Committee members voted 16-8 for the Senate-passed measure and sent it to the full House for a vote in spite of resistance from some members over whether a bond issue is the best way to pay for the project.
Former Oklahoma House Speaker T.W. Shannon, R-Lawton, was a vocal critic of a bond issue, but newly elected Speaker Jeff Hickman, R-Fairview, has said he’s open to discussing the idea with his caucus.
“I think it’s time to get this project going,” said Rep. Skye McNeil, R-Bristow, who authored the House’s version of the bill. The Senate previously passed it.
Oklahoma’s Capitol opened in 1917 but years of deferred maintenance have contributed to many problems. For example, parts of the 400,000-square-foot building have been cordoned off by yellow barricades since 2011 to prevent pedestrians from approaching the building’s south side, where chunks of limestone and mortar have been falling from the building’s facade.
One of the state’s most visited tourist attractions, the Capitol’s interior features polished marble floors, valuable artwork and a dome that was added in 2002. But behind the walls are major problems that include a plumbing system with rotting pipes that has never been completely restored and a hodgepodge of electrical systems.
A detailed examination of the building found a concrete beam above the south portico that is crushing the brick that supports it, as well as antiquated piping and electrical wiring that are original to the building. There is also extensive cracking of the terrazzo floor in the building’s lower level.
Committee members said the estimate for repairing the Capitol was about $120 million when the project was first discussed three years ago. McNeil said that estimate did not include the cost of relocating state government offices while the project, which could last up to four years, is underway. It also did not account for escalating costs, she said.
“As you know, things go up,” McNeil said.
Several committee members, including Rep. Paul Wesselhoft, R-Oklahoma City, suggested that the state tap into the constitutional Rainy Day Reserve Fund to pay for the project and avoid the debt a bond issue would create. The fund currently has a balance of about $535 million.
McNeil said debt service and principal payments for a $160 million bond issue over 25 years would be $249 million.
State Bond Advisor Jim Joseph has said bond indebtedness is not an issue in Oklahoma and that the state has plenty of bonding capacity to afford a bond issue to repair the Capitol. More than 41 percent of the state’s bond indebtedness will come off the books in 2018, and more than 86 percent will be eliminated in the next 13 years.
As of January, the state’s annual debt service limit for all bond programs was about $265 million. The state currently pays about $165 million a year in debt service, meaning it has about $100 million in additional annual debt service capacity.
Joseph has said that at current interest rates, debt service on a $160 million bond issue for the Capitol would be just $10.1 million a year over 25 years.
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Online:
Senate Bill 2044: https://bit.ly/R1oXLF
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