04/13/1993 10:38 AM Senate HES

  The next piece of legislation the committee heard was SB 180                 
  (SCHOOL CONSTRUCTION  DEBT REIMBURSEMENT).   CHAIRMAN RIEGER                 
  said the bill would  reinstate a 70 percent of  debt service                 
  reimbursement.   He said SB  180 and SB  181 are one  of two                 
  alternatives being sent to the  Senate Finance Committee for                 
                                                                               
                                                                               
  consideration.  The  other two bills  are the capital  grant                 
  bills.                                                                       
                                                                               
  SENATOR SALO  referred to  page 4  and said there  is a  new                 
  Section 5  that deals  with prior  debt.   She asked how  it                 
  would work.   CHAIRMAN RIEGER  said the idea  is that  there                 
  would be a  limit on bonded  indebtedness which is based  on                 
  the  population  of that  municipality.   The  limitation on                 
  bonded indebtedness would be higher as the population of the                 
  community was larger.  The amount  of debt which would count                 
  would  be  all other  G.O. debt  and  the portion  of school                 
  construction   G.O.  debt   which   is   not  eligible   for                 
  reimbursement.                                                               
                                                                               
  Senator Salo asked  what the reason was  for including other                 
  municipal   debt.     Chairman   Rieger   said  it   is  his                 
  understanding that the concern is the overall debt burden on                 
  a municipality.   To have  a program that  speaks to  school                 
  debt in isolation,  without consideration of the  other debt                 
  of that municipality, could lead  a municipality into fiscal                 
  trouble.                                                                     
                                                                               
  SENATOR MILLER said  he believes  it was the  intent of  the                 
  sponsor to control  debt statewide.  Even  if a municipality                 
  does issue debt,  the state would  probably have to step  in                 
  and pick it  up as there  is probably that moral  obligation                 
  for the debt.                                                                
                                                                               
  CHAIRMAN RIEGER referred  to Section  3, "In evaluating  the                 
  projects,  the  department  shall  consider  at   least  the                 
  following  factors," and  said he would  like to  amend that                 
  wording to  make it  absolutely clear  that  the ranking  of                 
  priorities are not absolute.  He said it might be better for                 
  it to be an  intent statement.  Chairman Rieger  offered the                 
  following amendment:                                                         
                                                                               
  Page 5, lines 7 and 8, replace "at least" with "all of."                     
                                                                               
  Chairman Rieger said he  thinks it would make it  clear that                 
  all of the factors are to be considered.                                     
                                                                               
  SENATOR LEMAN also offered to  change "alternate" on page 5,                 
  line 15, to "alternative."                                                   
                                                                               
  CHAIRMAN RIEGER  asked  if there  was  an objection  to  the                 
  proposed amendment.  Hearing none, the motion carried.                       
                                                                               
  Number 194                                                                   
                                                                               
  SENATOR MILLER moved to pass SB  180, as amended, out of the                 
  Senate HESS  Committee with individual  recommendations, and                 
  with accompanying fiscal  notes.  There being  no objection,                 
  it was so ordered.