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By LLOYD DUNKELBERGER
THE NEWS SERVICE OF FLORIDA

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THE CAPITAL, TALLAHASSEE, March 20, 2017......... If Florida lawmakers don't agree to borrow money to pay for school construction and maintenance projects, they will come up about $36 million short of what state education officials have requested for a key program next year.

State economists made their final estimate last week on money available in the 2017-18 fiscal year for the Public Education Capital Outlay, or PECO, program, which is funded by the gross-receipts tax on utility services, including electricity and communications. They looked at two scenarios: one without bonding and the other with bonds.

With no bonds, the economists estimated PECO would generate $337 million in cash that could be used for projects in the kindergarten-through-12th grade system, state colleges and universities. That funding could be supplemented with other revenue. But if it is not, it will fall short of the $373 million PECO request from state education officials.

Bonding would change all of that. The economists project Florida has the capacity to borrow more than $2.5 billion in the next budget year, although that is a very unlikely scenario.

But in this year's budget, lawmakers did agree to borrow $275 million, the first PECO bonds since 2011, resulting in a $625 million PECO program when supplemented with cash.

Florida has a history of major PECO bonds, reaching a peak of $1.4 billion in borrowing during the 2006-2007 budget year. That changed with the election of Gov. Rick Scott in 2010, as Scott aggressively looked to limit state borrowing, resulting in a major drop in state debt. That drop was aided by historically low interest rates that allowed the state to refinance much of its debt at a lower cost.

But as lawmakers begin crafting a new state budget in the coming weeks, House Speaker Richard Corcoran, R-Land O' Lakes, has voiced opposition to new PECO bonding, while Senate President Joe Negron, R-Stuart, said he is open to a "reasonable" amount of bonding.

With Scott's record of limited borrowing, a major PECO bonding plan is unlikely and a more modest plan remains in doubt.

The debate over bonding has to be put in the context of the $373 million PECO request, which education advocates say is a conservative number that does not reflect the true construction and maintenance needs for public schools, state colleges and universities.