Is debt a bad thing, in and of itself?
That’s one of the questions county voters are called on to decide this year. The Democratic candidate for county judge, Ruben Becera, has made the size of the county debt the backbone of his campaign. He believes it’s a sign of bad management and blames Republican Will Conley. Conley, until recently a commissioner, is running for county judge (the chief budget officer and top manager for the county).
But is county debt really so bad?
Unlike the federal deficit that President Trump and Congress are running right now (granted, their willingness to use deficit spending is extreme but not unique), the county has not used deficit financing in the sense most people think of it.
In other words, Hays County has not used debt to pay for operating expenses, or to pay interest on other debt. No, Hays County uses debt primarily to fund major capital improvements, projects that will last for years or generations: new roads, a jail, parks and open space land.
In the same way, most people don’t pay cash for a house, and businesses don’t pay cash for a new factory. That’s because spreading the expense over time has economic and social value: it allows important improvements to be accomplished sooner, and it spreads the cost over both current and future users.
That’s particularly important in Hays County where we are seeing sustained rapid growth. If current residents had to pay cash for the infrastructure required to meet the influx of tens of thousands of people moving here over the next few years, then either 1) current taxes would rise drastically, or 2) we would postpone important improvements, putting us behind the growth curve and costing more in the long run.
There are risks to this strategy. If growth were to suddenly halt, the county might find – for example – roads overbuilt with too much capacity. But we suspect that for most residents stuck in traffic congestion this seems like a slim risk, especially given the county’s well-established trends for growth and its placement between two of the fastest growing metro areas in North America.
Much of the county debt has been approved by voters as part of bond packages. Another large part of the debt is for road projects backed by the state – allowing the county to expedite road improvements on state roads and be reimbursed by the state over time; so while it is technically county debt there is an outside revenue stream that will pay it down rather than county taxes.
The county’s fastest growing cities are also issuing debt, as are most fast-growth communities across the state.
The irony is that a fair amount of this debt was planned when Democrats controlled the Commissioners Court and were preparing for the future. Then it was Republicans, including the current county judge, Bert Cobb, who opposed county debt before his election, but later recognized its necessity. But the truth is there has been a debate in both local parties about the value of debt, and, more generally, about long-range planning and fiscal responsibility.
Yes, Will Conley and the incumbents on commissioners court supported bond packages, long-range planning, and debt. Yet, to oppose that debt means those in opposition need to specify which of those bond projects we should do without: road improvements like FM 1626 and Dacey Lane? Meager local efforts to improve I-35 and roads around Seton Hays Medical Center? The park monies that have gone into city parks across the county and helped preserve priceless open spaces for water quality like Dahlstrom and Jacob’s Well?
It’s good to have vigorous local races and there all kinds of issues and reasons to vote one way or another, especially with a number of bright and outspoken candidates in these races. And yet, even though the ownership of this newspaper leans Democratic in many respects, it would be a mistake in the midst of this hot election campaign to throw out the invaluable tool of prudent debt, used responsibly and with forethought.
