Note X – Long-Term Debt

Significant Changes to Note X – Long-Term Debt

Note X – Long-Term Debt

Clarification in the Instructions to preparer that all loans and installment purchases should be included.

Note X – Long-Term Debt

Note X – Long-Term Debt

The accompanying Schedule of Liabilities provides more details of the outstanding debt and liabilities of the (city/county/district) and summarizes the (city/county/district's) debt transactions for year ended December 31, 20XX.

The debt service requirements for general obligation bonds, revenue bonds and ______________ [1] are as follows:

  Principal Interest Total
20__[2] $ $ $
20__ - 20__      
TOTALS $ $ $


Debt Refunding [3]

The (city/county/district) issued $__________ of (general obligation, revenue) refunding bonds to retire $______ of existing ______ series bonds. This refunding was undertaken to reduce total debt service payments over the next _____ years by $__________. The financial statements reflect other financing sources of $______ and other financing uses of $_____ pertaining to this transaction.

Debt Guarantees/Conduit Debt [4]

In _______, (city/county/district) (guaranteed the debt/issued conduit debt on behalf) of the (other entity name), a legally separate entity. In the event that the (other entity name) is unable to make a payment, (city/county/district) will be required to meet the obligation. The total amount of outstanding (debt subject of this guarantee/conduit debt) at year end was $___________.

Unused Lines of Credit [5]

At fiscal year end, the (city/county/district) had $________ available in unused lines of credit.

Assets Pledged as Collateral for Debt [6]

The following debt is secured by assets that are pledged as collateral:

Debt: Asset:
[2020 G.O. Bond] 123 Oak St. Building


Significant Debt Agreement Terms [7]

The following financial instruments contain debt agreement terms with finance related consequences:

Debt: Clause:
[2020 G.O. Bond] [E.g., If the borrower defaults on two or more payments, the lender may require the borrower to repay the entire amount of the loan immediately.]

Instructions to preparer:

[1] Include other debt such as notes, loans (including loans from banks, individuals, other governments, etc.), installment purchases, special assessment bonds, etc. When reporting loans, only the amount actually drawn should be included here.
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[2] Separately list total debt payments for the next five years and in five-year increments thereafter.
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[3] The city/county/district should provide this disclosure in the year of transaction. Details concerning debt service reductions should be part of closing documents provided by the financial advisor.
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[4] If it is determined that the city/county/district is more likely than not (more than 50% likely) to make payments on the debt guarantee or conduit debt, add the following disclosure:

As a result of (reason for trigger), the (city/county/district) determined that it was more likely than not that the (city/county/district) would be required to pay $_______of the (other entity's name) debt service payments. This amount has been added to the (city/county/district's) Schedule of Liabilities (Schedule 09).
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If the city/county/district is more likely than not to make payments on the debt guarantee/conduit debt, they should report a liability on the Schedule 09 for the amount of debt they anticipate they will pay.

[5] Amounts available on purchase, store and fuel cards should not be included.
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[6] Identify the specific debts and their related pledged assets. In the event of any default event, these assets have been identified in the debt agreement as providing recourse to the bond holder. For example, a loan to purchase a building will likely have that building identified as collateral to the lender.
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[7] Identify the specific debt and describe any default or termination events included in the debt agreements which have a stated financial consequence. For example, missed payments may result in a new accelerated payment schedule (an acceleration clause).
Return to Reference 7