Treasurer Lynn Fitch’s Economic Briefing to the Legislature
Jackson, MS. Today, the State Economist’s office and the Office of the State Treasurer provided the annual economic briefing for members of the State Legislature. Amongst the highlights from the Treasurer’s report, presented by Deputy Treasurer Jesse Graham:
· State bond indebtedness continues a steady climb, reaching almost $4.4 billion in Fiscal Year 2016.
· From Fiscal Year 2006 to Fiscal Year 2016, bond indebtedness grew $1.3 billion (41.8%).
· Debt service is the third largest item in the State budget.
· Legislature did not fully fund debt service for Fiscal Year 2017 - $7.6 million in deficit appropriations needed before April 1, 2017.
· Legislative Budget Recommendation for Fiscal Year 2018 makes the same mistake – relies too heavily on special funds for debt service.
· Legislature’s heavy reliance on special funds has bled those funds dry. Don’t even have enough to cover short-term borrowing needs, which means taxpayers will pay more.
· Mississippi is behind the national average and behind its peer states in our debt ratios.
o Net Tax Supported Debt Per Capita: $1,707
o Debt as Percent of Personal Income: 5.0%
o Debt as a Percent of State GDP: 4.88%
o Debt Service Ratio: 6.0%
· New rules passed by the State Bond Commission are meant to help manage debt levels
· The Mississippi Prepaid Affordable College Tuition (MPACT) Legacy program has a $126.4 million shortfall.
· College Savings Board has requested emergency infusions from the Legislature the past three years – all have been ignored.
· MPACT Legacy Program will be insolvent in 2025 under current assumptions.
· MPACT bears the full faith and credit of the State.
· An opportunity to help shrink the shortfall by updating the 20-year-old investment statutes was left to die in committee by the Legislature.
Breaking the Cycle of Poverty:
· Mississippi has the highest poverty rate in the nation (22.6%).
· 246,000 Mississippi children live in poverty (34%).
· Mississippi ranks at or near bottom of all studies on financial habits.
· In states that have made financial education a high school graduation requirement, credit scores for recent graduates increased.
· An opportunity to make financial education a ½ credit course required for graduation was left to die in committee by the Legislature.
· 23% of Mississippi women live in poverty.
· Over 75% of Mississippi children living in poverty live in a household headed by a single mom.
· Mississippi is one of only 2 states in the nation that does not protect equal pay for equal work.
· Mississippi has a 27% pay gap, according to a December 2016 study by the State Economist’s office.
· Today’s wage gap costs a woman $375,000 over a 40-year career.
· Woman working 40-hour workweek earns $9,600 less than a man, on average.· An opportunity to close the pay gap was left to die in committee by the Legislature.