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NYS Comptroller

THOMAS P. DiNAPOLI

The Academy for New York State's Local Officials

Multiyear Financial Planning: A Tutorial for Local Government Officials

Module 3: Projecting Expenditures

Debt Service

Sensitive to Economic Change: To a degree (e.g., interest rates)
Predictable: Yes
Controllable: Yes
Large Portion of Expenditures: Generally no

Debt service payments, as noted above, are generally repayments of debt issued to fund capital expenditures.

Your municipality's capital plan should note when capital projects will be financed by bonds or notes and estimate the resulting debt service payments associated with them. These payments should be added to any ongoing debt service payments.

However, if your municipality tracks debt service payments through a separate debt service fund, remember that those payments will show up as interfund transfers from the operating funds that ultimately support them, rather than as debt service expenditures [See Interfund Transfers section]. Also, remember to account for costs associated with short-term borrowing (such as revenue, tax, or bond anticipation notes) and bond-issuance.

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