Timing couldn’t be better for new bond bill
By Dr. Fred Carter,
Francis Marion University
Special to the News and Press
The last time South Carolina passed a general obligation bond bill to support infrastructure for higher education, some current students here at Francis Marion University had not set foot in kindergarten.
That’s a long time to go without state funding for critical infrastructure — too long in a state where future success and growth depends on a better-educated population and work force.
Fortunately, this long funding drought may be coming to an end. Thanks to the leadership of Sen. Hugh Leatherman of Florence, chairman of the Senate Finance Committee, a bond bill is now under consideration that would give higher education in the state a much-needed lift. The bill has strong support in the Senate, and with help from Pee Dee Legislators like Rep. Phillip Lowe of Florence and Rep. Jackie Hayes of Dillon, who fought so hard for a House version of the bill this Spring, there is an excellent chance the bill will be enacted.
The bill would provide $222 million for the state’s universities and technical colleges. That’s good news for the state and good news for the Pee Dee. All of the region’s institutions of higher education – Francis Marion University, Florence-Darlington Technical College, Northeastern Technical College and Williamsburg Technical College – will benefit from the bill it if is passed.
The effect of that support cannot be understated. Enhanced educational opportunities are essential to continue progress in this region. The Pee Dee has come a long way in regards to the education of its people. But much ground remains to be covered. We must make sure our students have facilities of sufficient size and sophistication to meet their needs now and into the future.
The needs of higher education do not change with the season. The current bond bill would be a good idea regardless of any external factors. But, as it so happens, the timing for the bill is close to perfect.
Interest rates are at historic lows. The financial markets and their masters are all expecting them to rise in the near future. Borrowing money for large projects – a necessity for governments so as to more fairly distribute the burden if for no other reason – will never be more efficient than it is today. Postponing this action would, ironically, cost taxpayers more.
The bill is also well-timed with regards to South Carolina’s existing debt. As noted, it’s been 14 years since the state issued a general obligation bond bill. Considerable debt has been retired during that time period. The state’s borrowing capacity, even when compared to the state’s traditionally conservative standards, is many times the amount included in the proposed bill.
South Carolina’s prudent fiscal policies have allowed it to maintain the nation’s highest bond ratings since the inception of that coverage almost 50 years ago. The state’s AAA rating is the envy of the nation and a source of pride. When it comes to borrowing funds to invest in our citizen’s future, it will be a source of savings as well. South Carolina’s high ratings will mean even lower interest rates.
And history shows that the planned indebtedness will not cause those ratings to be diminished. Between 1968 and 2001, the state passed 26 separate bond bills, essentially one every 1.26 years. During that period of consistent investment in construction, improvement and repair in and of the state’s physical assets, including higher education campuses and facilities, the state’s bond rating never changed. The rating agencies know we are good stewards.
Passing this bond bill will continue that tradition. Need currently matches the timing of interest rate market in an exquisitely serendipitous manner. It almost would be irresponsible not to take this step.
So what are we waiting for? Pass the bond bill.
Dr. Fred Carter is President of Francis Marion University.