OPED: State must lower debt to protect future generations
On Wednesday, Oct. 4, the Pennsylvania House of Representatives took historic action to help lower the debt levels of the Commonwealth of Pennsylvania. By a vote of 117-80, the House approved House Bill 785, which I authored. It is high time that Pennsylvania take serious action to prevent future generations from being burdened with onerous debt.
This legislation includes three very important reforms to help protect Pennsylvania taxpayers. Over the next four years, we will be decreasing the Redevelopment Assistance Capital Program (RACP) debt ceiling by $250 million. RACP grants are given to local entities throughout Pennsylvania for economic development projects.
For public improvement projects no more than $350 million can be released in a single year and for RACP projects no more than $125 million can be released in a single year. Finally House Bill 785 would prioritize paying both principal and interest at the same time. As anyone with a mortgage knows, the quicker you retire your principal, the more you save yourself in interest costs over the life of the loan.
Without these reforms the Commonwealth is looking at general obligation debt increasing by nearly $2 billion over the next 20 years. The Commonwealth would also see an increase of $340 million annually in debt service payments over that same 20-year period if these reforms are not enacted.
The good news is that we have a path to more responsible fiscal governance if we enact my legislation. Not only will House Bill 785 prevent increases in the amount of debt, but also will reduce the Commonwealth’s debt by $5.27 billion over the same 20-year period. In total this legislation will result in debt service savings of $3.14 billion.
This past year the House Republican caucus has made it our mission to reinvent government. Voters have made it clear that they want their representatives, whether in Harrisburg or in Washington, to throw off the shackles of the status quo and act in a more fiscally responsible manner. My legislation accomplishes that by providing for the needs of Pennsylvania while lowering our debt levels and saving taxpayers’ money.
It is important that the Senate act quickly and pass this legislation as-is so it can be sent to the governor’s desk to be signed into law. Gov. Tom Wolf has made commitments to support this legislation both in person and in writing, and we expect he will honor his word and sign House Bill 785 into law when it is presented to him.
Pennsylvania taxpayers demand that we get this done and our children should be demanding we take this action as well. It is time that we in Harrisburg make the responsible decision and start to lower our debt levels and protect future generations.
— Rep. Stan Saylor, R-Windsor Township, is chairman of the House Appropriations Committee. He represents the 94th District.