Prince George's County officials are ironing out how to cover their share of the cost of the Purple Line -- and documents show the county is close to surpassing its own debt limit.
The 16-mile light rail project connecting Prince George's and Montgomery counties is expected to cost more than $2.4 billion. Both counties were prepared to shell out $120 million plans made under the administration of former Maryland Gov. Martin O'Malley. But Gov. Hogan has requested additional funds. Montgomery County agreed to pay $40 million more, but Prince George's County officials have been silent -- until now.
The county plans to issue bonds to cover Purple Line costs, even if it means going into future debt, County Budget and Finance Director Tom Himler said.
"We're getting close to our debt capacity and that's one of the things, moving forward, we're going to have to address," he said.
A recent audit of the county's finances found that debt is piling up toward the limit it set of 8 percent of the county's budget. That limit is projected to be hit by the end of 2016.
"In reality, the county is issuing debt at a faster rate than it is retiring old debt, so without increased revenues, the growth of the capital improvement plan has to be reduced," the report said.
Officials have made no secret of the county’s budget problems, with diminished reserves and the county’s AAA-bond rating hanging in the balance. They're offering the state land, offering access to right-of-ways the county owns and waiving some fees to take a little off the price tag.
Himler said the county is close to finalizing an agreement on the Purple Line.
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"We think it's still a critical project for the county, for the region, but we want to make sure it's good for us -- good for our taxpayers," he said.
To improve its overall economic health, the county is counting on development.
"That's why we're focusing so much energy on all this new development. If we can start seeing revenue growth, then our ability to issue debt is going to go higher," Himler said.