Editor's note: This is the fifth of a multipart series on HB 5202, the budget bill for the 2022 Legislative Session.

A somewhat confusing part of the budget is the Article XI-Q bond program, which was passed by voters in 2010. It is used to acquire, construct, remodel, repair, equip or furnish real or personal property that is owned or operated by the State of Oregon. In order to keep the State’s cost of financing as low as possible, the bonds are primarily issued on a tax‐exempt basis under the IRS federal tax code saving interest cost over the prior method of Certificate of Participation. Upon project completion, the unspent proceeds remaining are usually used to pay debt service or to be transferred to a different legislatively approved project.

ORS 286A.824 allows an agency to request financing for real or personal property projects that may be financed with Article XI-Q bond proceeds. Bond funds are not included in the agency’s budget, but in separate policy packages. But they need authorization to obligate taxpayers for the indebtedness through legislative budget bills.

SB 5701 increases bond authorizations for the 2021-23 biennium approving $156.07 million. This measure increases the general Fund support debt by $54.06 million in Article XI-Q general obligation bond authority reflected in HB 5202.

Within that authority is a decrease of $435,000 to the Department of Revenue that resulted from previously approved Article XI-Q bonds for the Electronic Valuation Information System (ELVIS). This reduction to cover the taxable portion of the project frees up $400,000 from project costs and $35,000 from costs of issuing bonds. This project total is $3,810,000 Article XI-Q bond authority remains for the 2021-23 biennium.

The Oregon Judicial Department requested an increase for the Crook County Courthouse. Approved were an additional $4,445,000 Article XI-Q bonds to finance $4,416,705 of project costs and $28,295 for costs of issuing the bonds. The authorization results in total 2021-23 Article XI-Q bond authority of $16,330,000 for the construction of a new facility to replace the Crook County Courthouse.

State Capitol Accessibility, Maintenance, and Safety Phase III, approved $19,865,000 Article XI-Q bonds to finance $19,630,000 of project costs and $235,000 for costs of issuing the bonds. The project is for capital improvements to the State Capitol Building, including upgrades to the 1938 building for improved functionality, fire protection systems, seismic retrofits, roof repairs, security upgrades, IT and media modernization, and upgrades to remaining mechanical, electrical, and plumbing equipment not addressed in Phases I and II.

New amounts are also directed to public universities in the amount of $30 million for Higher Education Coordinating Commission grants. Approved was $5.1 million to Oregon Department of Emergency Management, Resiliency Grant Fund. Lottery Bond authorization for 2021-23 are also increased in SB 5701 by $23.07 million to support three projects.

Details for bonds can be found in SB 5701 Measure Summary. Bonds are often dismissed because it isn’t a direct draw from the General Fund. But it is like charging a credit card and sooner or later the debt has to be paid by taxpayers.


--Donna Bleiler

Post Date: 2022-03-16 06:46:10

Last Update: 2022-03-14 11:09:50