June 2002: Advance Refunding Bonds

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This bulletin explains the reporting requirements for advance refunding bonds. Many school districts are issuing advance refunding bonds this year because the state is changing how it calculates and pays building aid. Building aid, rather than being based on actual debt service payments, will now be based on an "assumed amortization calculation" that assumes that districts borrow money for the maximum period of probable usefulness allowed by Local Finance Law section 11.00 and pays an assumed interest rate. Details are on the State Education Department's website.