Nov. 3, 2011
This editorial originally appeared in the Austin American-Statesman
It is hard to remember which came first the wildfires or the drought. Both, coupled with the intense summer heat, have made these past months unbearable for Texans in many parts of the state. Texas is experiencing one of the most severe droughts on record. The eleven months from October 2010 through August 2011 marked the driest in Texas for that same time frame since 1895, leaving many families and farmers suffering from this critical water shortage. The Texas Water Development Board estimates that the drought could cost Texas businesses and employees upward of $12 billion, annually, in lost income. Enter Proposition 2.
The proposed constitutional amendment will allow the board to issue additional general obligation bonds in an amount not to exceed $6 billion at any time. Proceeds from these bonds will be used in a revolving loan program that political subdivisions – such as cities, counties, districts, river authorities, and nonprofit water supply corporations – can apply for and access to fund water and wastewater infrastructure in their communities. By using a lower bonding rate, this financing option through the state is sometimes the only way water infrastructure projects are possible.
There is a history of voters approving constitutional amendments that give the board this authority. In 1957, Texans authorized the board to issue up to $4.23 billion in bonds for financing water-related projects. It is estimated that the board's existing bond authority will be exhausted before 2013, when the Legislature meets again. Without additional bonding authority and the passage of Proposition 2, the board will not be able to assist communities with funds to provide for the water needs of the state. Simply put, without Proposition 2, the board will be out of money to loan. And without rain, ensuring a sound infrastructure may be the only way to have access to water in dire times.
Will Proposition 2 cost taxpayers money? No.
Proposition 2 is self-supporting, meaning the repayment will not come from state general revenue. Entities that choose to use this funding to address their water needs will repay the principal and interest on the loans. Those payments will be used to repay the bonds. While I understand the concern that the board will be authorized to issue debt that has not been specifically approved by the taxpayers, the evergreen nature of these bonds is vital to the continuation of long-term funding for water infrastructure.
If cities do not have the option to apply for monies from the board, communities throughout the state will be forced to raise money on their own to support essential water projects.
Ultimately, this will provide the funding necessary to support the infrastructure and components of the State Water Plan. The plan, which is updated every five years by the board using a 50-year planning horizon, represents a true bottom-up approach necessary for water planning. Regional water plans developed by local entities are used to form the larger, statewide document. This plan prioritizes projects for water funding throughout the state, and funds to realize those projects are supported by the board through these loans.
With meteorologists telling us that the current drought is going to get worse before it gets better, the decisions that we make regarding future water supply and infrastructure are more important than ever before. It is important that we all make our voices heard at the ballot box, and I encourage everyone to get out and vote.
Seliger, R-Amarillo, represents District 31 in the Texas Senate and serves as chairman of the Senate Select Committee on Redistricting, and is on the Education, Finance, International Relations and Trade, and Natural Resources Committees.
