Approval: Rules for state borrowing are long overdue
What if your employer allowed you to make big purchases, borrowing money in the company’s name, without prior approval? Absurd, you say?
Not in West Virginia state government. There, until a few days ago, executive branch agencies could borrow enormous amounts of money without getting the governor’s approval.
During former Gov. Gaston Caperton’s administration, the state established a $25 million line of credit. It is handled by Bank of America, currently at a 1.68 percent interest rate for loans. For many years, it appears agencies — specifically, in higher education — used the credit without checking first with the governor’s office.
In 2013, Shepherd University borrowed $1 million for a new soccer field. Last year and this, Fairmont State University obtained $700,000 for a flight simulator and airplanes.
On Monday, Gov. Jim Justice called a halt to the procedure. He ordered that any state agency planning to use the line of credit must get approval from the governor’s office.
That seems overdue. Colleges, universities and other arms of government borrowing money through the line of credit are putting the state on the hook for repayment. It seems little enough to require they route requests through the governor.
Give Justice credit for spotting and correcting the problem, along with others involving how taxpayers’ money is spent. The number of changes he has made raises questions about how many other imprudent procedures for handling the public’s money need to be uncovered and rectified.