Recently, Arlington Democrats unanimously backed $316 million in new borrowing proposals. I was not at the meeting, but I would venture a guess that no one asked how much of this money should be paid for out of the regular budget, including road paving, park maintenance, facilities maintenance, landscaping, and street lights?
It is not to say that all of the spending in the bond proposals is without merit. And, the Board deserves credit for publishing a more detailed explanation of the bonds. However, the ongoing practice of pushing what should be annual budget items into bonds should come to an end.
And how much debt do we currently have?
For FY 2017, our total debt burden is $951 million. This round of bonds will push us over $1 billion. By 2021, our total debt will be $1.23 billion — an increase of 29% over current levels.
Currently, the per capita debt is $4,317. In 2021, every man, woman and child will owe $5,270.
For FY 2017, our total annual debt service budget cost is $109.7 million between the schools and general government. It is slated to grow to $143 million over the next five years. And our debt service to expenditure ratio is projected to rise and hover just under the 10% cap credit ratings agencies look to for maintaining our AAA rating.
These bonds will almost certainly pass because Arlington voters have proven time and again to be OK with the borrow, spend and tax philosophy. The voters continue to support the notion that maintaining a never-ending level of “manageable” debt is desirable.
But continuing to max out our credit card is a dangerous game. The current run of historically low interest rates combined with county revenue that has outpaced inflation has fueled this borrowing boom. What happens if there is a spike in interest rates? Or what if Arlington experienced the type of economic recession which makes it impossible for revenue to continue to rise?
Unfortunately, Arlington Republicans have failed to field a candidate for either the County Board or the School Board. Sure, it’s a presidential election year which presses the Democrat advantage to the maximum level in the county. However, without Republican candidates making a case of how to apply our principles to the issues facing the county, voters do not even have an opportunity to hear an alternative vision.