Bond panel OK’s financing for Bridgeport development
The State Bond Commission approved $31 million in financing Friday to allow leading sporting goods retailer to locate in the long-planned commercial development on Steel Point in Bridgeport.
And though the commission unanimously approved the financing for Bass Pro Shops, that endorsement came amidst an ongoing partisan debate over Gov. Dannel P. Malloy’s handling of the state’s credit card for capital programs.
Bass Pro has announced plans to open a 140,000-square-foot facility at the harbor, with total development and financing costs expected to fall just under $70 million.
Besides the $31 million approved Friday, the state also is expected to provide $9 million in future assistance with the developer providing the remaining $38.5 million.
“It’s important to get this operation up and running,” Gov. Dannel P. Malloy said after the meeting, predicting the retail facility, which will sell hunting, fishing, boating and other recreational items, will become “a regional attraction.”
State analysts project that at least $22 million of the financing for Bass Pro Shops effectively will be repaid with by the additional sales tax revenue generated by the retail operation.
“I did take a very close look at it and I am highly confident that they will generate enough sales tax to cover it,” said Sen. L. Scott Frantz R-Greenwich, who serves on the bond commission.
But despite the agreement over the Bass Pro Shops project, there was continued partisan friction over the state’s credit card.
Frantz noted that the state now has approved $1.79 billion in “general obligation” bonding this calendar year. That effectively matches the $1.8 billion limit the administration set for itself this year in reports both to the legislature and to Wall Street credit rating agencies. And the bond commission still has two more meetings scheduled for later this year.
“General obligation” bonds primarily are repaid with tax dollars from the state budget’s general fund, which collects receipts from income, sales and corporation taxes, as well as from most other minor taxes.
“Debt is something, when you are in a low-interest environment, that is very tempting,” Frantz told Malloy.
“Let me thank you for that excellent advice,” the Democratic governor responded.
Malloy quickly added that’s why he never borrowed $1 billion in controversial financing approved by his Republican predecessor, M. Jodi Rell. She and the 2010 legislature endorsed billions of dollars in short-term gimmicks to avoid raising taxes or imposing deep budget cuts just before Malloy took office.
The governor added Friday that he would re-evaluate the $1.8 billion limit he set for 2013, but announced no final decision about whether he would seek more borrowing.
The governor chairs the 10-member bond panel and his budget office has sole authority to set the group’s agenda.
Besides complaining about the amount of borrowing in the works, Republicans also said the administration needs to get projects underway more quickly once financing has been approved.
Rep. Vincent Candelora, R-North Branford, noted that as of July, nearly $6.2 billion in financing approved by the bond commission has yet to be actually borrowed — presumably because state agencies aren’t ready to spend the money yet. That is more than double the $3.06 billion backlog that existed when Malloy took office in January 2011.
“We need to try to get that number down to zero,” Candelora said.
Between 16,000 and 28,000 new jobs could be added in two years if even half of the $6.2 billion bonding backlog is eliminated, a report from the University of Connecticut asserted earlier this month.
But that could mean spending more money on debt service, or on staff in agencies that oversee major capital projects — such as the Department of Transportation.
Malloy, who inherited a nearly 20 percent deficit in the state’s annual operating budget when he took office in January 2011, told reporters afterward that while he would look to see even more capital projects go forward, he has to weigh that objective against other priorities while keeping the budget in balance.
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