Bingman, the president pro tempore of the Senate, refused to allow a proposed $40 million bond issue to fund construction on the AICCM to be heard on the Senate floor in May.
The state’s bonding capacity, the maximum amount of money from the state budget for debt servicing, has been at the center of Republican opposition to further funding for the museum.
According to Sen. Mike Mazzei, R-Tulsa and chair of the Senate Finance Committee, the current obligation is about 4.1 percent of the state budget.
“There is no legal ceiling to bonding capacity,” Mazzei said, “but there is a general sense of what is conservative, moderate and aggressive. I’m comfortable with a range of 3-4 percent. That protects the state if there is another recession or a loss of general revenue. We’d still be able to service our debts.”
Bingman’s call for a study comes when Oklahoma is facing several priority projects, according to Sen. Patrick Anderson, R-Enid. Anderson called for an audit of state expenditures on the AICCM prior to Bingman’s decision to not allow the measure to go to the floor.
“I have no objection to the completion of this project,” Anderson said, “but before we spend another $40 million, I’d like to know where and how the first $91 million was spent. Our bonding capacity is getting high, and we still need a new Veterans (Affairs) facility, a new (Oklahoma) Medical Examiner’s Office, and a new facility for the Department of Mental Health.”
A press release from Bingman’s office stated: “The Senate leader opted for an interim study because various bond proposals were suggested this session and more information is needed about the bond packages before lawmakers consider the issues.”
Jarred Brejcha, communications director for Bingman, said the senator intends to bring a bond adviser to “look at the state’s bonding capacity and what a healthy percentage is.” Brejcha said the study would include the AICCM, the projects listed by Anderson, and OK Pop, Tulsa’s pop culture museum.
According to Anderson, Oklahoma has already issued $63 million in bonds for the AICCM. “After the 2008 bond approval of $25 million, a spokesperson for the center told us that the rest of the money would be raised by the center through private contributions, but now they’re back wanting an additional $40 million.”
Sen. Andrew Rice, D-Oklahoma City and Senate minority leader, said the project has to be funded to completion.
After issuing a call for a full floor vote, Rice called the decision not to fund the center “shortsighted” and accused Republican leaders of reneging on their “legislative duty.”
“We are obligated to complete funding of this center,” Rice said. “It’s a state agency, so this is a project we are obligated to fund. They can either fund it or cut the agency; instead, they’re doing neither.”
Gena Timberman, executive director of the Native American Cultural and Educational Authority, the state agency that has responsibility for the AICCM, said the decision not to pass the bond issue means current funding will expire in August.
Timberman said the board of NACEA is “taking time to think through the implications. We know work will now be delayed for another year,” she said “The cost to Oklahoma will be about $10 million as a result of the delay, in addition to lost revenue from the center opening.”
Timberman said funding issues arose because of delays in the project’s commencement.
“Anytime you delay a project, costs go up significantly,” she said. “The original vision for the center was created about 1999. At that time, the projected cost was $100 million. Construction prices, including materials, increased dramatically after Hurricane Katrina.”
The current projected cost is $170 million, and Timberman said she welcomes scrutiny of the project, including how funds were spent.
“We’re audited annually,” she said. “We’re a state agency.
The audit is on file. We welcome any review of our processes because I
believe it would increase confidence in our project.”
said additional costs will increase the final project total. “When we
have a delay, we have to spend millions to secure the site for issues
like flood control and security.
“Our immediate task is
to secure the site and then rethink our private fundraising campaign,”
she said. “We need to meet and decide what is the best time to kick off a
campaign, but that means we have to answer the question of when we’ll
be able to open.”
Rice said funding for the center is
critical because of the potential the site has to attract out-of-state
tourism, create jobs and generate tax revenues.
caucus was fully supportive of this project; we were prepared to fund
it,” Rice said. “The center has the potential to generate huge revenues
and to make us an international destination. As soon as this project was
announced, we started getting interest from all over the world. This
center will be a big draw.”
secretary-treasurer of NACEA, told the Tulsa World the project “will
create a $3.8 billion economic impact over 20 years, supporting 2,300
longterm jobs and generating twice as much in new state revenue as it
will take to complete the project.”
Republican leaders, including Gov. Mary Fallin, have expressed support for the project but want to fund it responsibly.
Fallin is going to work to examine viable, fiscally responsible
completion strategies with all relevant parties,” said Alex Weintz,
communications director for Fallin.
Rice said the bond
issue is not the only power the state has to fund the project. “We can
find another way,” he said. “We can end some of the tax credits that
Sen. (David) Dank and Sen. Mazzei have been reviewing, tax credits that
were supposed to create jobs but haven’t.”
For now, the
center will be largely unfunded for at least one more year. Bingman’s
office said he would appoint members of the interim study group later in