Louisiana borrowing picture improves after debt refinancing
Louisiana has more wiggle room to borrow money next year for state-financed construction projects, a brightened forecast presented Thursday that replaced grim projections of a cash crunch so deep it threatened to stall nearly all projects.
Recent debt refinancing, along with better-than-expected terms for a recent bond sale has lessened borrowing constraints in the upcoming budget year that begins July 1, financial analysts told the State Bond Commission.
Treasurer Ron Henson described the improved projections as "a little breathing room."
Louisiana borrows money through bond sales to investors to pay for college building repairs, economic development projects, parish water system upgrades, roadwork and other items in the state construction budget. In exchange, the state repays the debt over decades with interest.
The state is limited by a debt cap, and has been hovering close to it — with previous concerns that it wouldn't be able to borrow money at all in the upcoming 2018-19 budget year under the traditional 20-year payoff structure the state uses.
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