- Associated Press - Sunday, May 25, 2014

SALT LAKE CITY (AP) - The state treasurer says Utah has cut down the amount of money it owes but is still in debt for more than $3 billion from its borrowing during the economic recession in recent years.

Treasurer Richard Ellis told lawmakers this week that Utah’s debt is $3.5 billion, down from $3.8 billion at its peak.

That’s $1,063 for every Utah resident, and much higher than it should be, Ellis told members of the Executive Appropriations committee on Tuesday.

That gives Utah one of the highest per capita debt levels of any state with a AAA bond rating, the best credit rating available, The Salt Lake Tribune reported (https://bit.ly/StgukI ).

Ellis said that per-capita debt should be closer to about $850 per person, and barring any changes, the state will reach that level in 2016.

Much of the debt came from state-issued bonds from 2009 to 2011 that helped pay for highway construction projects, including the rebuilding of Interstate 15 in Utah County.

The state is paying about $500 million annually on the debt, Ellis said.

While the amount of money owed is falling, it will likely not be until 2018 or 2019 when the outstanding debt falls enough to lower the annual payments.

Senate Budget Chairman Lyle Hillyard, a Logan Republican, said the Interstate 15 bonds were worth it, but the other bonds piled on the debt.

“I think the problem we had is we haven’t been able to control ourselves since then,” he said.

He said the outstanding debt prevents the state from issuing bonds to pay for big projects, such as relocating the state prison in Draper.

The Utah State Prison now takes up 700 acres in a high-tech corridor south of Salt Lake City.

The facility is more than 60 years old, in need of upgrades and expansions and is occupying valuable real estate, Utah leaders say.

A state panel working to find a new home for the facility has not yet found a new site or determined the cost, but they say construction wouldn’t start before 2018 at the earliest.

Hillyard said if nothing changes in a few years and the state doesn’t take on more debt, Utah will be in a better spot to offer bonds.

But right now, things are tight, he said.

“If we had a major earthquake, we’re in trouble,” Hillyard said. “We wouldn’t have the bonding capacity to rebuild and we couldn’t raise taxes enough to do it.”

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Information from: The Salt Lake Tribune, https://www.sltrib.com

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