THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Wednesday, September 11, 1996 TAG: 9609110446
SECTION: BUSINESS PAGE: D2 EDITION: FINAL
SOURCE: STAFF REPORT
DATELINE: NORFOLK LENGTH: 37 lines
Virginia is widely recognized as one of the nation's best fiscally managed states.
The commonwealth has a balanced budget, some of the lowest taxes in the country and its economy is purring.
But if the state wants to maintain that golden-boy status, it had better reduce its bond debt, warned Hunter B. Andrews, the ex-state Senate majority leader.
The outspoken former Democratic senator from Hampton, who chaired the state's powerful Senate Finance Committee for 10 years, called for a moratorium on issuing new state revenue bonds.
Speaking at an Economics Club of Hampton Roads luncheon Tuesday, Andrews said Virginia risks losing its AAA bond rating.
``The integrity of this commonwealth is at stake,'' he said.
In a startling upset, Andrews lost re-election last fall to ex-Hampton vice mayor Marty Williams. Andrews had served 32 years in the Senate.
Andrews used Tuesday's luncheon in Norfolk to tout Virginia's strong economy, push for better education in the state and sound the alarm on state borrowing.
Virginia has raised $10.9 billion for state housing, education and other projects by issuing revenue bonds, he said. That's not a lot compared to most other states, but it's edging toward a level that might signal to investors that Virginia has too much debt.
Virginia is one of only six states to receive from major bond rating agencies the highest rating of AAA. Andrews warned that the state could lose that prestigious ranking if its level of bond debt increases from current levels.
``We've lost sight of fiscal responsibility with regard to bonded indebtedness,'' he said. by CNB