Auditor Harmon reminds each Kentuckian: You have a $12,261.58 debt
FRANKFORT – $12,261.58. That's how much every man, woman and child in the commonwealth of Kentucky would have to pay to retire the state's debt, Auditor Mike Harmon reported Tuesday.
Kentucky's total debt was $54.6 billion for the fiscal year that ended June 30.
Nearly 80 percent of that was an estimated $43.3 billion in the unfunded liabilities of Kentucky's public pension systems.
"As has been widely known, Kentucky's unfunded pension liability has grown for many years. But what many people don't know is that the Commonwealth has additional debts of $11.2 billion" in different types of bonds, Harmon said in a news release accompanying his report.
He said the state made more than $1.1 billion in principal and interest payments last fiscal year toward that $11.2 billion of bonded debt.
Harmon's report is what he calls a "data bulletin" – an effort by his office to shed light on important statistics about how state government operates.
His report says that of the $11.2 billion in bonded debt, $9 billion is supported by state budget appropriations. The biggest shares of this are $3.85 billion in outstanding bonds of the State Properties and Building Commission for construction projects and financing projects approved by the state legislature, and $1.81 billion in debt to Kentucky's public universities.
More than $2 billion in bonds is not supported by state appropriations. This, Harmon said, includes student loans and the $727 million in bonds for funding the Ohio River Bridges Project through the Kentucky Public Transportation Infrastructure Authority.
Harmon expressed concern that the Kentucky Economic Development Finance Authority, or KEDFA, is one agency that has no limit on the amount of bonded debt it can issue and is not required to get legislative approval before issuing "conduit bonds," such as those that funded the controversial KentuckyWired project in 2015 to help link all of Kentucky with high-speed broadband.
"As we saw in our recent examination of the KentuckyWired project, taxpayers ended up being on the hook for at least $1.5 billion over the next 30 years, with no specific legislative approval of the plan," Harmon said in the news release.
Because failure of that project would jeopardize the state's entire credit rating, Harmon said lawmakers should establish additional limits on KEDFA's bonding authority.
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By Tom Loftus
Louisville Courier Journal
Kentucky Press News Service