New York state is on the brink of racking up more unsustainable debt, state Comptroller Thomas DiNapoli warned on Tuesday.
DiNapoli studied three proposals for borrowing floated this year by Lt. Gov. Richard Ravitch and Democrats in the Senate and Assembly. He didn't like what he saw: annual principal and interest payments of between $725 million to $850 million-or more.
The proposed borrowing would be used to cover operating expenses and help close the state's $9.2 billion deficit.
"When you borrow to close budget gaps, there's nothing to show for it but the billions taxpayers pay out each year-no roads, no schools, no bridges," DiNapoli said. "It's time to put aside borrowing proposals and move forward with a budget that recognizes New York's fiscal reality. Every day of delay is just more wasted time."
The state currently has $60.4 billion of debt-a number projected to grow 11 percent by 2014, even if the state doesn't borrow a penny this year.
DiNapoli's projections are based on proposals to issue $6 billion of bonds to be repaid in 10 years. Over the life of those bonds, taxpayers would spend at least $7 billion to repay all principal, plus interest charges.
Once all bonds were issued, annual debt costs would be between $725 million to $850 million, beginning in the state's 2013-14 fiscal year.
The bonds would add at least 12 percent to the annual debt service payments the state already makes, which total $6 billion.
It's not any better if the bonds are repaid over 20 years, DiNapoli said. Then, annual principal and interest costs would be smaller, but the total amount repaid over the life of the bonds could hit $9.5 billion.
For the full report, go to www.osc.state.ny.us.