When a person takes out a mortgage to buy a home, there is significant “truth-in-lending” laws requiring the loan contract disclose -among other things – the interest payments that will be required. It only makes sense, then, that when government offers voters a bond referendum similar disclosure provisions should be in place. After all, voters are deciding whether or not to assume a debt they will have to repay – why shouldn’t governments be held to the same standards?
Fortunately, HB 248 has now been passed by the House and Senate and goes to Gov. McCrory’s desk. The bill would require language on the ballot of bond referendums to include mention that interest payments will be required in addition to repayment of the principle, and that taxes may be raised in order to finance the additional burden. The bill also requires the local finance officer to include estimates of the interest payments on the bond order so that local voters are educated as to the real cost of the bond debt.
It is absurd that voters have been denied such transparency about the true costs of government debt until now. If Gov. McCrory signs this bill into law, it will take effect Sept. 1, 2013.