Utah debt load estimated at $7.89 billion

Sep 17 2013 - 8:08pm

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Utah State capitol, (Standard-Examiner photo)
Utah State capitol, (Standard-Examiner photo)

SALT LAKE CITY -- Utah has an outstanding debt load of approximately $7.89 billion, a state report released Tuesday says.

The report identifies all of the state's outstanding related debts and includes direct and indirect obligations, not just money owed on general obligation bonds.

The largest percentage of the debt is $3.36 billion in general obligation bonds, which is approximately 82 percent of the state's bonding capability. State lawmakers have set an 85 percent bonding limit, and Mark Bleazard, of the state's executive appropriations committee, said lawmakers came in $740 million less than that self-imposed limit.

The report also says the state paid $315 million in principal toward bond obligations in the past year, with another $143 million in interest.

Another large chunk of the debt is related to education. Approximately $2.61 billion is related to the public school guaranty fund. Other education obligations include $92 million in higher education student loans and $71 million in Board of Regents revenue bond commitments.

Rep. Brad Wilson said the idea of the state carrying more than $1.4 billion in student loan debt is frightening. In an appropriations committee on Tuesday, he pressed Bleazard about whether state officials have any sense if that payback is coming in as expected.

Bleazard said that in speaking to the state treasurer, the revenue coming in to address the debt is in line with expectations.

Wilson was not relieved.

"A billion dollars in student loans the state is on the hook for is a sobering number," Wilson said.

Rep. Mel Brown, R-Coalville, also said the outstanding debt for bonding is a wakeup call.

"The debt number scares me," Brown said.

He did point out the state's AAA bonding rating has benefited local school districts and higher education institutions, by helping them save on potential interest expenses for costs.

The state report on total debt came on the heels of news Tuesday of a budget surplus of $242 million in the state education fund for the recently completed 2013 fiscal year.

State officials have promoted the Beehive State as a model for fiscally conservative management practices.

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