House Bill 1225, Education & Transportation Bond Act of 2020, is a $3.1 billion bond package that would borrow money to finance school construction and transportation projects.

It is more prudent to spend money that is on hand instead of borrowing, which burdens future taxpayers and crowds out future revenue that could finance core government services. However, Gov. Cooper’s budget veto of 2019 left many holes that could have been funded through the State Capital and Infrastructure Fund on a pay-as-you-go basis.

Even so, the economic shutdown imposed by the Cooper administration in response to the coronavirus has left the state with a massive budget void. Taking on additional debt during such an uncertain time is not good public policy.

Perhaps most concerning, around half – $1.5 billion – of this bond issuance would go to the state’s Department of Transportation (DOT) for transportation projects.

A recent state audit of DOT found that the department had over committed itself to spending projects, resulting in critical budget holes. Given the budget at hand from the coronavirus, it is alarming to think about using state borrowing to give even more money to a department that lacks the internal controls necessary to ensure public funds are properly spent.

From a taxpayer perspective, establishing better internal controls at DOT is a greater need than accruing state debt for a department that has lost the faith of North Carolinians.

For these reasons, Civitas Action will grade against House Bill 1225 if an acceptable Department of Transportation reform bill is not passed this legislative session.

Civitas Action is a 501(c)(4) non-profit that educates and informs North Carolinians on policy issues and the actions of their elected officials.