The Republican governor wants the legislature to put two bond proposals on the ballot in November of about $1.5 billion each, one for roads and one for other infrastructure, including University of North Carolina facilities.
The work needs to be done to move the state forward. State Treasurer Janet Cowell says there is enough debt capacity to manage the new borrowing. If anything, the plan is relatively modest — although in the current political climate its success is not guaranteed.
Low interest rates make it a good time for borrowing. However, deep tax cuts — and legislative proposals for more — raise questions about how debt will be repaid. The gas tax is the principal means of paying for transportation projects. The legislature has just cut the gas tax under a new formula. The cut isn’t as sharp as would have occurred if the rate were still connected to the wholesale price of gasoline, but it will erode Highway Fund revenues.
Furthermore, while it’s important to modernize university facilities and other infrastructure, voters are aware that the state continues to cut UNC operating funds while raising tuition. Paying for new buildings might require even deeper operational cuts.
In pushing for significant new investment, the governor is bucking the direction set by the Republican legislature. He has a tough sales job to get his bond measures on the ballot and then to win public approval. Failure at either step will weaken him politically as he enters an election year.
McCrory should press on anyway, taking inspiration from one of his predecessors. In 1949, Gov. Kerr Scott persuaded a conservative legislature to put highway and school bonds on the ballot. Then he campaigned for them with as much energy as he had for his own election the year before. The voters said yes. The money helped North Carolina lift itself from its backward status and begin a transformation to a more progressive and prosperous state.
McCrory was that kind of mayor in Charlotte. As governor since 2013, however, he has yet to move the state forward. Now is his chance. The state’s competitive position depends on having modern transportation networks. Universities, in danger of falling behind, must have world-class facilities for teaching and research.
These advances cost money that ultimately must come from taxes. The political atmosphere in North Carolina is dominated by a legislature that believes government should be starved of revenues so that the private sector can keep more money.
Taxes should never be too high, but the private sector won’t build roads, bridges or other necessary infrastructure. The state has a critical role, and the governor has to explain that role to the people.
McCrory seems willing to accept the challenge. If he fails, his re-election chances will look very doubtful.
